BusinessDay 09 Aug 2019 by BusinessDay

Akintola Williams: Africa’s first chartered accountant at 100 OLUWASEGUN OLAKOYENIKAN

frica’s first chartered accountant and founde r o f t h e c o u n t r y ’s oldest indigenous accounting firm, Akintola Williams, today, Friday, August

9, 2019, clocks 100 years with several remarkable and enviable achievements to his credit. Among many surviving Nigerians who played vital roles in shaping the economy of Africa’s most populous nation, Williams even at 100 continues to serve

as a source of inspiration to younger ones who look up to him as a role model. Akintola Williams is particularly celebrated for his pioneer efforts in the history of Nigeria’s accountancy profession. Not only has he been passionate

about his profession, but he’s also been committed to using his intelligence and brilliance to set a pace for others to follow. No wonder he is referred to as the doyen of accountancy profession

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businessday market monitor

Biggest Loser

Biggest Gainer MTNN N132.50 3.27pc

GUINNESS N41.40 -10.00pc 27,424.92

Foreign Reserve - $44.69bn Cross Rates - GBP-$:1.21 YUANY-N 51.52 Commodities Cocoa

US$2,254.00

Gold

$1,502.55

₦4,168,978.53 +1.70pc

Foreign Exchange

Buy

Sell

$-N 357.00 360.00 £-N 438.00 450.00 €-N 392.00 402.00

Crude Oil

$ 57.40

news you can trust I **FRIDAY 09 AUGUST 2019 I vol. 19, no 368 I N300

FMDQ Close

Everdon Bureau De Change

Bitcoin

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Market I&E FX Window CBN Official Rate Currency Futures

($/N)

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fgn bonds

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Spot ($/N)

363.31 306.90

0.53 10.84

NGUS OCT 30 2019 362.03

6M -0.05

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12.33

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NGUS JAN 29 2020 362.48

NGUS AUG 26 2020 363.53

Nigeria courts hunger as insecurity threatens food production U A

MTN Nigeria set for million dollar boost from MSCI frontier inclusion

…EFG Hermes expects inflows of around $8.5mn …Shares jump by most in nearly three months

CALEB OJEWALE

p to 5.3 million Nigerians experienced acute food crisis in 16 states of northern Nigeria last year. The country was identified among eight countries with the worst food crises in 2018, together accounting for two-thirds of the total number of people facing acute food insecurity in the world – amounting to nearly 72 million people. This was the finding of the 2019 Global Report on Food Crises. The report highlighted northern Nigeria as the driver of food insecurity in the country and Nigeria as among eight countries expected to face the most severe food crises in 2019. Nigeria, with over 82 million hectares of arable land, a large youthful population, a tropical climate, and soil that supports a

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LOLADE AKINMURELE

big catalyst is on the way for shares of MTN Nigeria. MTN Nigeria’s imminent inclusion on the Morgan

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Download e-copy of Women’s Hub from www.businessday.ng

L-R: Bashir Hadejia, Zamfara State government official; Ifie Sekibo, MD/CEO, Heritage Bank plc; Bello M. Maradun, governor, Zamfara State; Benedict O. Oramah, president/chairman, board of directors, Afreximbank; Nasiru Mu’azu Magarya, speaker, Zamfara House of Assembly; Sani Shinkafi, Zamfara government official, and Chris Oshiafi, chairman, PAC Capital Limited, at the signing of $1bn MoU Investment for Zamfara State with Afreximbank, in Abuja. Heritage Bank is the banker to the project.

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news Dangote Refinery gets new completion date on delayed logistics …plans own trading desk in Lagos OLUFIKAYO OWOEYE

elay in the importation of steel and other equipment has forced the management of Dangote Refinery to announce the end of year 2020 as the new completion date for the 650,000 barrels per day (bpd) integrated refinery and petrochemical project which is currently underway in the Ibeju-Lekki area of Lagos State. Devakumar Edwin, Dangote Group executive director, said despite the delays at the congested Apapa and Tin Can Island Ports in Lagos, the company could start using the refinery’s tank farms as a depot to warm up operations. According to Edwin, Dangote is setting up its own trading desk, with a senior team of three people and a staff of roughly 30 who will monitor international commodity prices. Speaking on the modus operandi of the tank farm, Giuseppe Surace, chief operations officer, Dangote Refinery, said the tanks would be connected to five single-point mooring buoys (SPMs), which would allow

the refinery complex to pump crude straight into tanks from large ships at sea and pump products back out onto boats of any size. A single-point mooring (SPM) is a floating buoy/ jetty anchored offshore to allow handling of liquid cargo such as petroleum products for tanker ships. It is mainly used in areas where a dedicated facility for loading or unloading liquid cargo is not available. The SPMs would be the primary method of supplying oil products from the refinery, Surace said, adding that the team was considering using the tanks as training or as a depot before the refinery’s production starts. “The team is in talks with NNPC, two other international oil companies and two large oil traders, all of whom are interested in supplying crude and buying products,” he said. According to Surace, the crude unit for the refinery, which set sail from China last month, would arrive by the end of October, noting that the trains at a fertiliser plant on the same site would start up by the end of this year.

FIFA U20 Women’s World Cup hosting seen stimulating Nigeria’s economic growth …hospitality, tourism, transportation to gain ...quest gets stakeholders’ nod as FG pledges support ANTHONY NLEBEM

f Nigeria succeeds in its quest to host the 2020 edition of the FIFA U20 Women’s World Cup, it would be a boost to the country’s tourism business as well as impact positively on “Brand Nigeria”. If granted the hosting right by FIFA, Nigeria would be the first African country to stage the event. The quest by Nigeria is getting the nod of stakeholders, who noted that if the global tournament holds in the country, all sectors of its economy would benefit. They added that Nigeria cannot afford to lose out on these opportunities. “It will stimulate growth across all the major sectors of the economy,” said Rasaq Abiola, head, investor relations, United Bank for Africa plc. He advised that Africa’s largest economy should position itself and leverage on the opportunities of staging the event. Nigeria has put forward the cities of Lagos, Benin

City, Asaba and Uyo for the hosting of the 16-nation finals. The government says it is 100 percent in support of the country’s bid to host the tournament. “The government of Nigeria guarantees to back the bid 100 percent. We are actually excited with the prospect of hosting the FIFA U20 Women’s World Cup in 2020. For us, football is a unifying force. Government interest in hosting is beyond commercial; football is a measure of unity and well-being of our people as diverse as we are,” Vice President Yemi Osinbajo said in Abuja on Thursday when a team from FIFA and accompanying officials of the Nigeria Football Federation (NFF) and members of the Bid Committee paid him a courtesy call at the Presidential Villa. He promised that the government would mobilise every apparatus to ensure a successful hosting, in the areas of infrastructure, security and other logistics.

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L-R: Adaeze Okonkwo, team lead, travels and protocol, Access Bank plc; Herbert Wigwe, GMD/CEO; Chu Maoming, consul general of the People’s Republic of China, and Victor Etuokwu, executive director, retail banking, Access Bank plc, during the bank’s executive management’s visit to the Ambassador in Lagos, yesterday

Buhari orders full investigation into killing of police officers by soldiers ...as police condemn army statement, demand for notorious kidnapper TONY AILEMEN & INNOCENT ODOH, Abuja

resident Muhammadu Buhari on Thursday ordered full investigation into the killing of three police intelligence officers on covert operation in Ibi, Jalingo, Taraba State, by military personnel serving in the state. The killing is said to have resulted from poor communication between the military and the office of the Inspector General of Police in Abuja. President Buhari had met behind closed doors with top members of the nation’s Security Council at the Presidential Villa, using the opportunity to set up a special committee to investigate the

“unfortunate killing”. Speaking to State House correspondents after the meeting, the Chief of Air Staff, Sadique Abubakar, disclosed that the president set up a committee to investigate the “unfortunate incidents in Ibi, Taraba State”. According to him, the committee would be constituted under the Defence Headquarters to unearth the truth on the incident. The Air Chief also said that the council evaluated the current strategy of managing internal security operations all over the country and was satisfied with the current efforts being made by the security agencies to curtail crimes in the country. “We are making substantial progress in all the areas of conflicts,” Sadique said.

The service chief, however, assured Nigerians that the armed forces of Nigeria and other security agencies would continue to work to ensure the security of Nigerians. He added they would also ensure that no individual or group of individuals undermine the territorial integrity of Nigeria. Asked if the council discussed the issue of using technology and drones to fight crimes as earlier pledged to the south-west leaders, he said “technology will continue to play a very critical role in resolving security challenges in Nigeria”. The NPF had on Wednesday accused some unidentified soldiers of shooting to death three police officers and a civilian along the Ibi-Jalingo Road, Taraba

State. The police officers were taking an arrested suspect, Alhaji Hamisu, to the command headquarters in Jalingo when they were shot at by the soldiers. The police spokesman said the victims were shot despite sufficient proof that they were police personnel on legitimate duty. The police alleged that several other officers were also injured during the attack. But the Army spokesman, Sagir Musa, a colonel, countered the police claims stating that the policemen allegedly refused to stop at a military checkpoint and were trailed and shot dead by troops who had earlier received a distress call.

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Nigeria’s rising losses, fallen refining capacity reinforce need for disclosure, fiscal governance STEPHEN ONYEKWELU, Lagos, & HARRISON EDEH, Abuja

igeria’s petroleum refining losses have continued to increase amid a failing ability to locally refine crude oil. Experts have attributed this to weak fiscal governance and minimal disclosure from regulators of Nigeria’s oil and gas sector. In spite of promises by successive governments to improve the performance of the refineries and commit significant resources to their rehabilitation, the four refineries continue to operate below a combined 20 percent capacity utilisation, data from the Nigerian National Petroleum Corporation’s 2019 monthly bulletin show. The refineries have also recorded consecutive

…Experts set agenda for new petroleum minister as PIGB drags losses in 2018 and 2019. In the 11 months ending November 2018, the Kaduna Refining and Petrochemical Company made a loss of N31.62 billion, Port Harcourt recorded a N44.2 billion loss, while Warri refinery lost N38.5 billion. These losses followed a similar pattern in 2019, according to the latest data obtained from the NNPC, which showed that the Warri Refining and Petroleum Company (WRPC), the Kaduna Refining and Petrochemical Company (KRPC) and the Port Harcourt Refining Company (PHRC) ran deficits for 13 straight months. “To address concerns of the sector, the NNPC must be made to run as a corpo-

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rate entity. It must run like a corporation independent of undue interference,” Henry Adigun Ademola, oil sector governance expert, told BusinessDay. “There must be full disclosure on the activities of the corporation in terms of crude importation, what was imported, among others, to enable Nigerians who are the rightful owners of the corporation to track investments in the sector,” Ademola said. In the draft National Oil Policy submitted to the Federal Executive Council (FEC) on November 2016, the Federal Government had planned to list the NNPC on the NSE after concluding reforms in the country’s petroleum sector. Three years after, the plan @Businessdayng

is still far from reality as the state-owned oil company struggles with rot, lost investment opportunities, corruption, and controversies. And there are wider concerns on whether the government can find investors for the sector, which is the mainstay of Nigeria’s economy, if the fiscal governance structure is not attractive. Ode Ojowu, professor of economics and former head of National Planning Commission, said the NNPC is an enigma of some kind and people have questioned the correctness of the figures the corporation prints as revenue to the Federation Account.

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Lagos shuts 52 pharmacies, patent medicine stores JOSHUA BASSEY

agos State government has shut 52 pharmacies and patent medicine stores for illegal operations in different parts of the state. Some of the medicine stores were discovered to be operating without approved licences, while others allegedly overstepped their scope of operations. They were uncovered in areas like Isolo, Egbeda, Ikotun, Bariga and Somolu in Oshodi-Isolo, Alimosho and Somolu by the Lagos State Taskforce on Counterfeit, Fake Drugs and Unwholesome Processed Foods. Titilayo Goncalves, permanent secretary in the state ministry of health, who gave further insight on the development, Thursday, August 8, explained that beyond operating illegally, the affected medicine stores also engaged unqualified persons to man and dispense drugs to unsuspecting citizens. They also operated beyond scope

through sale of ethical products and displaying and storing drugs in unconducive environment, which compromised the potency and integrity of the drugs, rendering them ineffective. “Although some of the pharmacies visited were registered, it was disheartening to discover quite a number of them had no qualified pharmacists on duty and displayed expired drugs for sale to the public,” Goncalves explained. She added that some of the premisesvisitedalsoengagedinillegalclinical practicessuchaspatientadmissionand setting of intravenous infusions. She notedthatsuchpracticewasunacceptableandpledgedthegovernmentwould dowhatevernecessarytoenforcethelaw and sanction erring operators. “The sealing of the affected pharmacies and patent medicine stores was in accordance with the provisions of Section C34 of the Counterfeit, Fake Drugs and Unwholesome Processed Foods Miscellaneous Provision Act of 1999, No. 25,” she said.

She stated that licensed patent medicine vendors were authorised to sell drugs only in their original packs in approved pack size as produced by the manufacturing companies. “The law prohibits dispensing and wholesaling of drugs by patent medicine vendors,” she said. While noting that the recent operation of the taskforce was coming on the heels of the war being waged against fake drugs and illegal drug shops, Goncalves noted that the activities of the state task force on fake drugs would not only be sustained, but intensified until operators in the sector adhered strictly to the provisions of the law as it relates to pharmacies and patent medicine shops, in order to safeguard the health of the citizenry. Still on the illegal medicine stores, Moyosore Adejumo, director of pharmaceutical services in the ministry, the action taken by the government, is part of the renewed efforts to sanitise the drug distribution system and curb proliferation of fake drugs in the state.

Creative Counsel champions revolution in experiential design GBEMI FAMINU

...holds #FutureNow, inaugural experiential design summit

eading experiential design firm, The Creative Counsel (TCC) Nigeria, part of The Insight Redefini Group, has set the pace for the revolution of the experiential space as it held its inaugural Experiential Design Summit tagged #FutureNow. The event themed ‘Experiential Design in the Age of Artificial Intelligence and Augmented Reality’ brought together various marketing experts and communications specialists across sectors such as financial, ICT, eCommerce, FMCG, and entertainment, in an effort to foster conversations around machine learning and data mining highlighted in new age technology and the transformation of consumer behaviours. In his opening remarks, Ken Onyeali Ikpe, Group CEO, Insight Redefini, recalled the partnership of the group with global marketing communications firm, Publicis Groupe, in 2016, which caused a huge shift within the Nigerian marketing and communications space, emphasising that the birth of TCC was to change the land-

scape of activations, engagements, and customer experiences that can be uniquely measured and managed. Jimi Awosika, vice chairman, Troyka Holdings, at the event said brand managers need to be more open-minded, taking off existing industrial age thinking to become post digital age managers. “Businesses can be transformed on the back of digital transformation, and managers can bring that transformation with the application of the mind. On its own, technology cannot do without the application of the mind,” he said. Also speaking at the summit, the convener, Joshua Akinbanjo, chief operating officer, TCC Nigeria, said, “TCC is in the business of the show for which the metrics of success are instant and feasible.” He noted that the compound annual growth rate (CAGR) of IoT market is projected to grow to 15 percent with a value of about $581 billion for ICT-based spend by 2020, stressing that only ambitious

and discerning brands leaders with ambition to drive category leadership will adapt technology to drive consumer connections in order to improve volume and value for profits. The panellists and moderators at the event included Okenla Christiana, AGM, customer experience and advocacy, ipNX Nigeria Limited; Oyebowale Akideinde, entertainment and tech executive; Mayowa Adebayo, chief marketing officer and consultant, Wakanow; Omotola Elatuyi, marketing manager, innovations, Guinness Nigeria; Bosah Madueke, augmented reality developer; Agbons Igiewe, general manager, Ziza Digital; Anurika Azubuike, lead consultant, Quadrant MSL; and Lekan Babalola, head of business operations, TCC Nigeria. The event, which featured practical demonstrations of virtual and augmented realties as well as experiential activities that kept all guests engaged, was supported by Silverbird Television, Rhythm FM, Dominos, H2Oh!, Seven-Up, Afrione and Nasco.

LS Scientific’s new N300m labs will detect cholera in your food BUNMI BAILEY

S Scientific Limited, a solution provider of laboratory (Lab) products and services, has unveiled its world-class laboratories worth about N300 million that will among other things detect cholera or any micro-organism in food. The scientific event and exposition, which took place from Tuesday, August 6 - 8, 2019, showcased four laboratories namely the world chemistry lab, microbiology lab, instrumentation lab and the technical and calibration lab. The four labs with testing and analysis will help ensure the highest level of quality and supply equipment, chemicals, consumables, safely and protect layers. Olumurewa Odunjo, MD, LS Scientific Limited, at a press conference said, “We are here to officially launch our laboratories which will help us to study the consumer able food that manufacturers produce to ensure that they have the highest level of quality and also showcase our technical capacity within the

Nigeria environment. “The first lab is called the wet chemistry lab which will help carryout different analysis using various chemicals. For example, if you want to know the amount of sodium in salt, or minerals in water, you can carry out such test in this facility. “The second one is the microbiology lab where we carryout micro-organism studies. If you want to know if there is Ebola or cholera in your food, micro-organism or foreign matter, this lab will help you with it.” The instrumentation lab is fully equipped with the state-of-the-art equipment, using high tech equipment’s and machines to do analysis and the last one acts as a support system which carryout technical affair, maintenance, calibration and training of users of these equipment. “We are unveiling the labs to Nigerians, and West Africans to ensure that production of goods are world class. So we are reaching out to Fast Moving Consumer Goods (FMCG), www.businessday.ng

oil and gas, manufacturing companies, etc,” Adewale Olukoya, the head of marketing and business development at LS Scientific Limited. “We have the equipment here that can carry out world class laboratory analysis and ensure that the qualities of finished products are world class. That is why we are partnering with the Standards Organisation of Nigeria (SON), the National Agency for Food and Drug Administration and Control (NAFDAC) and others,” Olukoya said. Last year, the Association of Foreign Airlines Representatives in Nigeria (AFARN) said that Nigeria loses over $30 million in export produce annually, due to poor quality control and poor packaging. Hopefully the development of these labs will help to ensure quality assurance in Nigerian products. “This is a long time investment, we are not looking for money, we are trying to make sure that Nigeria produces the highest quality of products to be able to compete in the international space,” Odunjo said. https://www.facebook.com/businessdayng

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PAC Holdings positions for new frontiers through Academy KELECHI EWUZIE

ith the troubling increase in migration and export of local talent to foreign lands seeking greener pastures, there is no doubt there is a need to fill in the talent gap in the workforce. It is in response to this demand that Proprietary Investment Company, Pan-African Capital Holdings Limited, instituted its Graduate Trainee Programme, PAC Academy in 2016. Now, in its third stream, the Academy on Friday, August 9, 2019, held its graduation ceremony for the graduating set aptly dubbed, ‘The Amazing 8’, who include, Adeniran Adeola, Funmilola Adeyanju, Akande Oluwafunmito, Adedayo Emmanuel, Ige Oluwatobiloba, Olalekan Ipele, Victor Onyema, and Oredipe Morounranti. Present at the graduation ceremony, CEO, PAC Holdings in his opening remark, said, “Each of you is the future of Nigeria, of Africa and of course, PAC Holdings. It is with immense pride that we congratulate our exceptional graduates. “The past 12 months have no doubt been rigorous as it has been a learning experience

and you have each displayed a consistent passion and brilliance throughout. It is commendable.” We look forward to the many feats and remarkable disruptions you will bring to the sector. The possibilities that lay ahead of you are endless, he further remarked. The PAC Academy is a continuity development programme designed to groom and equip new graduates with the skills necessary to become fully independent PAC Holdings professionals. The programme combines theoretical insights and hands-on practical approach, giving access to unparalleled range of roles and growth opportunities to the Trainees across various strategic areas including; Leadership skills development, Networking, Coaching and Mentoring relationships, World class training (classroom based learning, e-learning modules), and Job Rotations in the different subsidiaries that make up the PAC Holdings Group. PAC Academy offers an opportunity to learn and grow as professionals. We wish the ‘Amazing 8’ the best in their life’s pursuit, as we remain committed to cheering them on!

Desist from modifying approved designs, Lagos tells residents of housing estates CHUKA UROKO

or r ied by mindless distortions and alterations of approved structural designs in government’s housing estates, the Lagos State government has warned residents of those estates to desist from such acts, saying it is in the best interest of the residents to do so. Wasiu Akewusola, permanent secretar y in the State Ministry of Housing, who gave this warning at a meeting with the representatives of Residents Association of Abraham Adesanya Estate at the state Secretariat on Thursday, listed such alterations as restyling, extension of, and additions to existing facilities and, in some extreme cases, increase in building levels. “These alterations are deviations from the terms and conditions stated in the deed of sub-lease signed by the two parties,” the permanent secretary noted, warning, “these acts could lead to a penalty as stated in the law.” C o n t i nu i n g , h e s a i d , “The government-owned estates are designed and built by the state government in compliance with global environmental and physical planning rules to ensure durability and liveability.” According to him, contravention of such standards often resulted in dire consequences such as reduced durability of the structure for the home owner and other people within the environment, advising the residents to desist from

any form of redesigning of the buildings as such action could cause damage to the building and the entire environment in no distant time. He stressed the need for the residents to maintain the original structural design to prevent future disasters. “A building is a permanent load whose capacity of erection can only be known and accessed by certified engineers. This capability, which is environmentally determined, had already been quantified before the buildings were erected. Any plans to overload the capacity may result in disaster,” he warned. He also reminded the residents that all unapproved remodelling contravened the Physical and Urban Planning Law of the state government, hence affected buildings would be demolished by the appropriate agency of the state government. “The demolition exercise of illegal and unapproved structures in gove r n m e nt- ow n e d e st at e s will commence very soon without any further warning,” Akewusola disclosed, pointing out that the state the state government was aware of some residents who had turned government’s housing estates setbacks into marketplace. “It will no longer be business as usual as the state will not rest on its oars in ensuring that sanity returns to it estates; the state monitoring team has scaled up its surveillance activities to ensure compliance with set environmental standards,” he informed. www.businessday.ng

L-R: Bukola Adebisi, technical services manager, Lafarge Africa; Titilope Oguntuga, sustainable development and corporate brand manager, Lafarge Africa; Folashade Ambrose-Medebem, director, communications, public affairs and sustainable development, Lafarge Africa, and Tonye Braide, immediate past president, Nigerian Institute of Architects at a press conference to announce the 2020 LafargeHolcim Awards for Sustainable Construction in Lagos, yesterday.

Oil price slump to see banks apply more caution against CBN’s credit creation hile current falling oil price experienced in the global crude oil marketdarkensfurther outlook for the Nigerian economy, the banking sector particularly is not immune to its effects if trend continues considering its heavy loan exposure, especially to the oil and gas sector of the economy coupled with financial intermediation role to other private sectors. On Wednesday, Brent crude oil price plummeted about 5 percent to a 7-month low level of $56.23, a levelbelowNigeria’sbudgetedoilprice benchmark, adding fresh threat to the country’s current precarious state. Analysts say the deepening tensions between the US and China followingtheBeijingdecisiontoallowthe renminbi to fall below 7 to the dollar after the US slapped new sets of tariffs on the Asian country, are damaging oil prices. The National Bureau of Statistics (NBS) in April revealed that Nigeria

deposit money banks’ (DMBs) domestic component exposure to the oil and gas industry was to the tune of N1.86 trillion, 39.70 percent of a total loan portfolio of N4.68 trillion to the sector. This leaves foreign component exposure to account for 60.3 percent (N2.82trn). Evident in the NBS bank credit report for Q1 2019 is the fact that Nigerian banks are more exposed to the oilandgassectorthananyothersector of the economy. In Q1 2019, credit to the sector accounted for 22.96 percent (N3.49trn) of banks total credit to the private sector, hence opening up the industry to shocks in crude oil prices, which is in nature very volatile. Sequel to the above report of banks credit by the NBS in April, crude oil price in the global market had slumped about 25 percent from highest peak of the year at $74.57 in April, which as seen Nigeria upstream oil and gas companies share price trend downwards to their year low coupled with prevailing negative market sentiment. While this maybe too early to start

igniting concerns on the implications ontheassetqualityofbanksgiventheir high level of exposure to the oil and gas sector, “for banks to start feeling the impact, the downturn in oil prices will need to match pre-crisis level in 2015/16,”GbolahanOlogunro,analyst atCSLStockbrokers,toldBusinessDay. Consequently, if Brent settles below $40 levels, then there is a high likelihood of increased impairment charges when banks report their numbers. In the last 3 years, Nigeria banks’ non-performingloan(NPL)hasgrown atanannualaverageof10percentafter the spike in NPL in 2016 following the global oil price shock that saw the economy plum into a recession. In April 2019, however, NPL of banks in the oil and gas sector declined 10.71 percent to N777. 84 billion year-onyear. Recall in the bid to boost the Nigerian private sector and invariably grow the economy, the CBN mandated deposit money banks to lend more or face rise in minimum reserve requirements to 50 percent.

This saw loan to deposit ratio of banks increased to 60 percent, which some analyst fear it may worsen bank’s NPLs. However, most banks have not grown their loan books aggressively despite the unorthodox policies of CBN, compelling them to increase their lending to the private sector. “With the recent happenings in the oil banks, we should expect banks to be more cautious in creating risk assets. For banks with legacy issues, loan growth will remain muted in the short to medium term,” Ologunro noted. In the bid to align to supervisory regulations,historicallybanks’appetite tothe oiland gas sector has always outweighedothersectorsoftheeconomy. “Current trend in crude oil prices will see foreign assets held by Nigerian companies decline in value when converted to naira, which in turn affect their earnings. This therefore threatens the loan book of banks and may see them slow down lending going forward,” Olalekan Ipele, investment analyst at Lagos-based Investment Bank, PAC Capital.

Hope Moses-Ashike

... CBN sells $4.4bn in Q1

Limited, said, “Nigeria does not operate fixed exchange rate rather it operates guided one,” saying if dollar is being sold at N357.50k, it means that it is appreciating. According to the report, the CBN has supported the FX market by providing liquidity through various interventions. For instance, its secondary market intervention sales (wholesale and retail combined) totalled $4.4 billion in Q1 2019 and $3.7 billion in the second quarter of the year. In addition, through the CBN’s Chinese yuan interventions, mainly geared towards manufacturers, CNY127.7 million ($18.8m) was injected into the market in Q2 2019. To access this segment of the window, the importer’s letter of credit must be denominated in Renminbi. The report states that oil market movements will continue to

be a source of concern for Nigeria’s macro environment as the exchange rate relies on healthy oil price levels. “As for “hot money” from FPIs, we suspect that possible rate cuts by the US Federal Open Market Committee could lead to further inflows into the market and underpin the naira exchange rate,” analysts at FBNQuest say. The price of oil stood at $57.4 per barrel as at yesterday, lower than $70.38 per barrel in April 5 2017. Akinwunmi says if the price of oil continues to fall, things will not remain the same. Godwin Emefiele, CBN governor, said foreign reserves were enough to cover some months of imports. Nigeria’s external reserves stood at $44.69 billion as at August 7, 2019, according to the numbers on the CBN website. Oil receipts (including oil related taxes) contribute directly to external reserves. The crude oil price has averaged $64/b year-

to-date (ytd). Furthermore, oil production has been somewhat stable. In the absence of an oil price crash, we assume that the stability in the fx market will continue. Foreign portfolio investors (FPIs) contribute indirectly to the external reserves. Since July yields on government securities have generally declined due to various CBN policies including a reduction in the frequency of OMO sales. This may cause some pressure on the I&E window as the market is unable to attract fresh inflows from FPIs due to a downward movement in returns. Yields on the NTB (T-bill) market currently range between 10.50% and 12.00%. Aggregate foreign exchange inflows through the Central Bank of Nigeria (CBN) amounted to $35.28 billion (52.8%), while the outflow stood at $17.78 billion (96.7%), resulting in a net inflow of $17.40 billion in the first quarter of 2019.

DAVID IBIDAPO

Competition in banks cheapens dollar to N357.50k ompetition in Nigerian banking sector is driving down the cost of dollars to as cheap as N357.50k, lower than N360 that the Central Bank of Nigeria (CBN) directed them to sell. The CBN in 2017 said it would sell dollars to banks at N357 and direct them to sell to their customers at N360. A report by FBNQuest available to BusinessDay indicates that the CBN’s sales to Small and Medium Enterprises (SMEs) and for invisibles (personal travel allowance inclusive) amounted to $1.2 billion in the second quarter (Q2) 2019 and were offered to customers through banks at N357/$. In a bid to remain competitive, banks were offering a resale rate as low as N357.50/$ as opposed to the N360/$ upper limit prescribed by the CBN. Ayodele Akinwunmi, head of research, FSDH Merchant Bank

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Talking about revolution THE NEW WEALTH OF NATIONS

OBADIAH MAILAFIA

s I write this piece, Omoyele Sowore, the social activist and presidential candidate of African Action Congress (AAC) has been in detention in the dungeons of the Department of State Security (DSS). He was taken away from his Lagos home at dawn last week ostensibly for announcing that he is launching a Revolution Now movement that will “shut down Nigeria”. Rumour has it that the government is preparing charges of high treason against him. That cannot be a small matter at all. I have met Sowore only once, and that was sometimes in January, just before the presidential elections. He struck me as a patriot, albeit of the irreverent variety. He lacked intellectual gravitas, a deficiency he camouflages with a rather overbearing volubility. But I liked him. His heart is in the right place. If he had read more history in his schooldays he would have known better than to announce his revolution on social media. For, in truth, the revolution will not be televised. My dictionary defines revolution as, “a forcible overthrow of a government or social order, in favour of a new system”. By announcing to the whole world that he was embarking on a “revolution”, Sowore made himself vulnerable. What the wisest revolution-

aries do is to draw attention to social grievances and petty injustices and to mobilise the people against their oppressors. On this matter, he was penny wise and pound foolish. It sounds harsh, but I must make it clear that the government was right to read in it a plan for its eventual overthrow. And government did what most governments do under such circumstances – clump the revolutionaries in prison and harass all who share their sentiments. This does not by any means justify his illegal detention. I have been among the first to publicly demand for his release. Talking for myself, I am instinctively more in favour of evolution rather than revolution. The eighteenth century conservative Anglo-Irish political philosopher Edmund Burke was famously opposed the 1789 revolution because he saw it as a bloody event that did more than harm than good. The French Revolution produced the terror that consumed thousands of French men and women. One thing about revolutions that Burke foresaw is the fact that every revolution ends up eating some of its own children. The revolutionaries who were consumed by the upheavals of 1789 included Danton and Mirabeau. One of the most successful revolts by an oppressed people was in the island of Santo Domingo (Haiti), where the slaves rose en masse to cast of the iron manacles of servitude. Led by a man of military genius, Toussaint Louverture, the black slaves waged a way that overwhelmingly defeated the French. Other leaders of the Haitian revolution included men such as Henri Christophe, Jean-Jacques Dessalines. Haiti, the first black republic in history, became an independent nation on 1 January 1804.

The military and political drama of that revolt has been captured for immortality in the great work by the remarkable Caribbean Marxist historian CLR James in his book, The Black Jacobins: Toussaint Louverture and the San Domingo Revolution. Toussaint was a farsighted visionary who sent Haitian soldiers to join Abraham Lincoln in the American civil war to emancipate the black slaves. He also sent soldiers to support Simon Bolivar in Latin America, on conditions that supported the liberation the benighted black slaves of Hispanic America. The years 1774 to 1849 have been dubbed The Age of Revolution. It all began with the American revolutionary war of Independence against the British in 1776. The French Revolution of 1789 sent tremors all over the Old Continent. The absolutist monarchies of Europe were overthrown, leading to the creation of republican governments based on the popular will. When I was an undergraduate, my main education on the subject of revolutions came from reading the work of the Cambridge political theorist John Dunn. Dunn focused most of his work on the revolutions of the twentieth century; from the Mexican Revolution of 1910 to the Chinese Revolution of 1949 and the African anti-colonial revolution that ushered in the wind of change in the sixties. When some of us were growing up, our political ideals were based on Revolution and the New Man. We were inspired by Fidel Castro, Che Guevera and their comrades on the Grandma rickety boat that landed in Cuba and successfully overthrew the oppressive dictatorship of Fulgencio Batista in 1959. Che, for us, was the perfect image of the New Man. We were also inspired by Franz

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Yes, Nigeria is more than ripe for revolution. But I doubt if a classic revolution is possible in our context. My hope is in the youths, as happened recently in the Sudan. When the youths decide they’ve had more than enough

Fanon, Ahmed Ben Bella and the FLN leaders of the Algerian war of independence. Mao captivated our imagination. As a student in Paris I used to hang about with friends at the famous café where Zhou En-Lai served whilst a student in France; later rising to become Premier of Communist China. We were in awe of the Vietnamese, particularly Ho Chi Minh and the greatest guerrilla military strategist of the twentieth century, General Vo Nguyen Giap. Revolutions come in different forms: industrial revolutions, socialist revolutions, anti-colonial revolutions, scientific revolutions, Islamic revolutions and so on. Political revolutions are invariably violent and bloody affairs. The Iranian Revolution of 1979 under Ayatollah Khomeini succeeded in replacing one system of oppression with an even worse one. The Islamic Republic has destroyed the liberties of women and civic communities in Iran, leading to the dictatorship of backward Mullahs who look back to the non-existing romanticism of the Middle Ages instead of science and invention in the twenty-first century. Revolutions tend to generate terrors which consume millions of innocent people. Under Stalin’s forced collectivisation, 20 million Russians perished. Under Mao’s brutal so-called “Cultural Revolution”, an estimated 70 million Chinese died.

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Dr. Mailafia is a former Deputy Governor of the Central Bank of Nigeria, a development economist and public finance expert with a DPhil from Oxford obmailafia@gmail.com; 08036590990 (text messages only)

The man who made Donald Trump

upert Murdoch is a native Australian and a naturalised American citizen. He is 87 years old, and in his fourth marriage – to Jerry Hall, a celebrity and former model, who is several decades younger than him and who used to be married to Mick Jagger of Rolling Stone. He is an active, colourful man, despite his advanced age. Rupert Murdoch sits at the helm of the largest and most powerful media conglomerate in the world. After the death of his father, a reporter and editor in Australia in 1952, Rupert formed his own company, News Limited. He went on from there to expand his media empire, acquiring titles in Australia and New Zealand, then moving into the United Kingdom and United States. Later, his holding company, News Corporation acquired Twentieth Century Fox (a film production company), HarperCollins (a publishing company), and the Wall Street Journal. He formed British broadcaster BSkyB and expanded into Asia and South America. Very soon News Corporation owned over 800 companies in more than 50 countries. The Sun, one his major newspapers, was credited with helping John Major defeat Neil Kinnock of Labour in the British General Election. The same newspaper, years later, would play a crucial role in swaying the British public to vote for Brexit. The characteristics of Murdoch’s media operations included free market ideology and opposition to the perceived liberal bias in other public media. Whether it was originally intended like that or not, Rupert Murdoch’s Fox News and other media in the stable have become the most powerful promoters of right-wing nationalistic,

often anti-democratic leaders that are beginning to emerge across the world. Fox News was launched in 1996 to fill what Murdoch saw as an unmet need for 24-hour news from a right-wing perspective. His instinct was spot-on. Fox News quickly grew to become the dominant subscription news network in the US, outpacing the other major news networks – CNN and MSNBC. In 2015, 81.4 percent of television subscribers in the US were receiving Fox News. From the outset, the channel set a trend of biased news coverage and reporting, and also popularised the format of talk shows which was previously developed on radio, where popular voluble figures came on air to dispense their views, which were not required to meet the criteria or objectivity or even fairness. The staunch support for the Republican Party was evident from the days of President George W Bush. During the Obama era, the network was regularly hostile and disparaging of the President and his plans and achievements. Fox News and its talk show hosts provided regular justification for the Republican legislators’ efforts to shut down Obama initiatives including the Affordable Care Act – designed to make health insurance available to economically and socially disadvantaged Americans. In the elections that led to the emergence of Donald Trump, Rupert Murdoch did not have a particularly high opinion of candidate Trump and did not think much of his chances. He also did not agree with some of his ideas, such as his views on trade and Immigration, which were out of step with mainstream Republican ideology.

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Jared Kushner, Trump’s son in law, did much to bring the two people together. At that time what Trump had in his corner was the ‘lunatic fringe’ right-wing press represented by brands such as Brietbart, who not only distorted news but also parlayed ‘conspiracy theories’ designed to stoke the paranoia of white supremacists. If Trump could get Rupert Murdoch, and through him Fox Media, on board, then he would have access to, and legitimacy from, not only the ‘Far Right’, but the mainstream ‘Right’, as well as the large number of ‘Undecideds’ that regularly tuned in the Fox. The tactics of Jared Kushner worked. Murdoch, and Fox, moved solidly behind Trump. From that point, he became unstoppable, not only blowing his Republican rivals out of the water, but also acquiring that swing energy of the ‘Undecideds’ that would crucially coalesce to give him victory in the most shocking election outcome of the century. The question has been asked – who used who? Did Trump use Murdoch, and his Fox Network, to ride to power, despite the fact that he knew Murdoch did not consider him a ‘true Republican?’ Or has Murdoch used Trump to strengthen and consolidate his media empire, placing it in an unassailable position in the global media landscape? Murdoch, after all, was not averse to demanding and getting favours for his conglomerate from various Presidents he had helped in the past, including Reagan and Bush. Will the ‘marriage’ between Fox News, which is now, in all but name, the ‘official news media’ of the government of the US,

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HUMANANGLE

FEMI OLUGBILE and Donald Trump endure, and help to win Trump re-election? Or will there be a fracture, as Murdoch tries to return to ‘true journalism’ – his original calling, after this spell of ‘business journalism’ in which he has turned biased news coverage and toxic commentary into high art for the consumption of a gullible American public? The first signs of a cleavage may have emerged recently, when Fox News reported a national poll of potential voters in 2020 which clearly did not favour Trump. The President reacted by lambasting Fox, a most unusual occurrence. But that may just have been a storm in a teacup. Meanwhile the rest of the press, principally CNN, is reacting with anger, frustration and hostility, making them a mirror image of Fox News. There is an increasing tendency to lace News with anti-Trump opinion. In that battle zone, there is no middle-ground. It is a fine mess in the Fourth Estate of the realm, in the US, the land of the free. Femi Olugbile is a Writer and Psychiatrist. Comments to synthesiz@ gmail.com’

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Why Nigeria Needs High-Impact Entrepreneurs

ELOHO OMAME

ntrepreneurs are crucial for economic growth, but not all entrepreneurial firms are important contributors to economic productivity. The best entrepreneurs drive innovation, create high-quality jobs, spread wealth and wider prosperity, contributing to vibrant markets that boast inclusion and sustainability. Entrepreneurs that have the desire and potential to create businesses that will scale are rare. Two things are still missing from the conversation about the potential for entrepreneurship in Nigeria: first, clarity about the kinds of entrepreneurs that could deliver the large-scale impact that our economy needs; and second, a strategy to create the best conditions for those founders to be successful. Ultimately, the entrepreneurs that drive productivity are those that successfully navigate their companies beyond the startup phase, tackling big markets, making bold decisions, and using innovative strategies and tactics. They grow high-quality workforces and attract capital. When we talk about “entrepreneurs”, SMEs and companies without innovative business models are unfortunately too often grouped together with the small number of founders that drive

the lion’s share of productivity. When ecosystems are productive, their cities and regions are more likely to thrive. Productivity differences ultimately translate to thousands more jobs, billions more dollars in economic growth, and a dramatically greater distribution of new innovations. Ecosystems that outperform generate more of the relatively few companies that will ultimately reach scale. In a recently concluded city-level study on six entrepreneurship ecosystems, produced with the support of the Bill & Melinda Gates Foundation, Endeavor Insight found that in places like Bangalore, Dhaka, Lagos, Nairobi, Kampala and Dar es Salaam, a large proportion of companies are not only SMEs, but actually low productivity microbusinesses, making no significant impact on local job creation, economic growth or other measures of productivity. Of 800 companies in Lagos (9,500 jobs between them), almost half had fewer than three employees and had never raised capital. The top 10 percent created more than two-thirds of employment and only 2 percent reached the scale of 100 staff. For revenue and job creation, it is companies at the scaleup stage that deliver the most significant outcomes. Innovative and typically technologyenabled, scaleups are identified by their high-growth rates and adolescent life-cycle stage, rather than sector or age. Their founders have navigated startup challenges (for example, acquiring their first customers, making their first hires and technology investments, refining their business models, raising seed capital) and are now focused on organisational robustness, aiming to address a widening customer base. They are often

at critical inflection points, whereby revenues can be rapidly scaled without jeopardising their business models. Critically, scaleups have the potential to make transformative contributions to their local economies. The London Stock Exchange estimates that 97 “fast-growing and dynamic” scaleup companies in Nigeria grew their revenues and workforces between 2015 and 2018 by compound averages of 47 percent and 23 percent respectively. For Paga, this meant an almost doubling of its financial services agent network from 12,000 in 2017 to more than 20,000 this year. Endeavor coined the term “highimpact entrepreneur” nearly 20 years ago. By “high-impact”, we mean those with the biggest ideas, the greatest potential to achieve meaningful scale, and the ability and mindset to inspire, mentor, and reinvest in the next generation. High-impact entrepreneurs are critical to the advancement of innovations and the spread of its benefits to customers. Sometimes they do this by commercialising R&D, often it’s by inventing new business models, and other times, it’s by finding better solutions to problems affecting consumers. Beyond innovation, high-impact entrepreneurs inspire generations, paying it forward by actively mentoring, advising and investing in other founders in their local ecosystems. They generate important multiplier effects that act as turbo-chargers to their success. Multiplier effects are extremely powerful and are the secret sauce of the world’s most productive ecosystems, an obvious example being Silicon Valley. Since 1995, 13 former PayPal employees, including Peter

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…in places like Bangalore, Dhaka, Lagos, Nairobi, Kampala and Dar es Salaam, a large proportion of companies are not only SMEs, but actually low productivity

Thiel (PayPal, Founders Fund), Elon Musk (Tesla, SpaceX) and Reid Hoffman (LinkedIn, Greylock Partners) have founded companies, actively advised and mentored founders, and invested over 1,000 times in 650 companies, creating arguably the community’s most important network of serial entrepreneurs and venture capitalists. Away from Silicon Valley, Endeavor’s work with high-impact entrepreneurs in emerging markets for over 20 years has proven that it doesn’t take many to fundamentally change the prospects of a city or even a country. In Argentina, despite severe economic challenges between 2000 and 2010, including a weakened exchange rate and double-digit inflation, a small group of Endeavor Entrepreneurs proved that by being leaders in Buenos Aires’ entrepreneurship ecosystem, even while focused on scaling their own companies to achieve the community’s first major exits, they could together create over 80,000 jobs and generate $1.4bn in revenues in 2010 alone. They contributed to a vibrant ecosystem by openly sharing their experiences, while actively investing, mentoring and promoting high-impact entrepreneurship. Those scaleup entrepreneurs included the founders of MercadoLibre – now Argentina’s most valuable company. The best incubators for entrepreneurship occur when high-impact entrepreneurs form close networks and nurture fellow risk-takers with their experience and resources. For Nigeria’s ecosystem to be long-term productive, its path must be led by successful entrepreneurs. Omame is Managing Director & CEO of Endeavor Nigeria

Ninth NASS: Sinators, horribles and an old peoples’ home!

he elections are almost over; almost, because the various courts and tribunals are still in their business of the real ‘voting’. That is after we, the voters, were given the impression that we voted, that our votes would be counted and that the counted votes would count! If you doubt this assertion, find out from INEC how many Certificates of Return (CoR) have been voided, transferred or withheld in the bullish CoR Exchange? But life is going on and the governance space appears calm. Earlier this week (precisely on 5 August), I asked townsman who has lived in Benin for as long as I have known him, (which is more than 40 year), how they were ‘managing’, especially with the Assembly crises and he replied: ‘that one does not concern me but how can Oshiomhole who boasted about how he destroyed and humiliated the godfathers now comeback to play a godfather? I digressed but seriously, no be me talk am! The ninth National Assembly has settled down to business and this time around, it is real business as a group of 90 men and women divided themselves into 69 STANDING committees, an average membership of 1.3! (I hope I won’t catch them sitting in their standing committees!). In effect, every member is a chairperson or deputy chairperson of a committee, with the usually opaque perquisites of office. You are aware that they do not have official cars but that does not preclude SUVs for legislative oversight, which every chairperson and the deputy is entitled to. The House of Assembly fared better as the 360 members set up just

109 committees (upped from the 96 in the last house), an average of 3.3 members per committee. Meanwhile, the US 115th Congress had 20 standing committees for their 100 senators. But that is the US; after all PMB advised us to look for home-grown solutions to domestic challenges. This over-bloated committee-ship is legislators approach to domesticating the solutions to our challenges! One of the beneficiaries, and public faces of the not too young to run movement, is the dashing and impeccably dressed Senator Abbo, the youngest Senator in Nigeria today. And he started his legislative oversight, even before the NASS was inaugurated and long before committees were set up, in an ‘adult shop’ in Abuja where he brutalized the shopkeeper and her friend who asked him to take things easy. Don’t ask me what he went to do at the sex toyshop where he was described as a regular customer or even why he was there when he already had enough female company (three of them!). Anyway, I belong to the old-school group; I must confess that I don’t understand how these things work. This story threw the nation into a rage. The Senate and PDP set up investigative committees, there were condemnations from even conservative quarters and some protest marches at Abuja and elsewhere. He attempted to deny the story, and then offered an open plea for specific and general forgiveness ‘with a deep sense of remorse and responsibility’. He was invited for a chat by the police, a chat that lasted more than one night and he ended up

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in court where as usual, he pleaded not guilty. These lawyers and courts sef! Somebody was caught in the very act (courtesy, the limitless powers of ICT) of assault and battery; he admitted same and offered a public apology and he had the temerity to plead non est factum at a court and the court accepted the plea? That is why I would not have been a good lawyer or a judge because I would have added the charge of public lying on his head. And as usual with Nigerian matters, everything about the ‘violent Senator’ is off the radar! Where are the protesters? Where are the reports of the Senate and PDP committees? And by the way, which committee is the adult-shop Senator chairing? The committee on law and order or police affairs? By the way, I commiserate with Senator Abbo on the brutal invasion of his family house, murder of his uncle and kidnap of his stepmother on 13 July 2019. In Nigeria, we have Criminals Incorporated operating openly and brazenly as bandits, (Fulani) herdsmen, Boko Haram, kidnappers and political thugs. The most important thing is that they are all criminals. This incidence and several others, indicate that the rich and powerful also cry! Other Matters: Where is Demola, the Chief Thug of Okota? During the last elections, Okota, a suburb of Lagos, received global attention and unfortunately, for the wrong reason. Before the elections, our dear democratic President had declared, “snatch ballot boxes and die”. During the national elections at Okota, one fellow went beyond the snatching of ballot boxes; he coolly set the ballots on fire, terrorized the voters and

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IK MUO electoral officers in the very before of helpless and hapless policemen! As fate would have it, he received a taste of his own medicine as a mob, probably those whom he had terrorized, attacked and left him for dead. By an act of God, he survived the onslaught, after he had seen that nobody has the monopoly of violence. Methinks the God of second chance decided to give him another chance. And now, 5 months after the elections I ask: where is Demola? I am asking this question from two angles. In the first instance, what has he been up to since then as regards his usual occupation as a merchant of violence; how has his near-death experience affected his attitude to unleashing mayhem on others? And then the main question: what has the police and other appropriate authorities done about this open-case electoral violence? This is not the case of an unknown soldier because the thug was arrested by the spirits, acting through the mob. And I know that there are laws on general violence and electoral violence. So, WHERE IS DEMOLA? The last I heard of him was the declaration by Lagos Commissioner of Police, Zubairu Muazu, that he would be arrested and prosecuted and “treated as a principal suspect and will assist to arrest other members of his gang”. That was more than five months ago, precisely on 28 February 2019. So, I ask once more: WHERE IS DEMOLA THE THUG?

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Friday 09 August 2019

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On the proposed taxation of ecommerce transactions

EDITOR Patrick Atuanya

here seems to be a permanent black hole in the finances of the country under this regime that requires taxing citizens to fill. The Federal Government, through the Federal Inland Revenue Service (FIRS), has floated the idea of levying Value Added Tax (VAT) on online purchases. The stated rationale is to grow the revenues of the federal government. There is a need for the tax authority, the National Assembly and the Federal Government to examine this proposal carefully before its implementation. Babatunde Fowler, FIRS Chairman, gave a hint of the plan in May. He told the News Agency of Nigeria, “Soon, we will ask banks to impose VAT on online transactions for purchases of goods and services. Not that it is something new; it actually should be in

Frank Aigbogun

DEPUTY EDITOR John Osadolor, Abuja NEWS EDITOR Chuks Oluigbo EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure GENERAL MANAGER, ADVERT Adeola Ajewole 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

existence. We will certainly follow up to make sure that every VAT that is due to be collected is collected.” Citizens have kicked against the FIRS plan. Naturally. There are grounds for the criticism mostly based on the record of this government; it spends more effort to increase non-oil revenue and has done little to make doing business easier. Rather than improve the business climate, its harassment of tax-paying big businesses fosters uncertainty. Records from across the world show the positive effects of VAT on government revenues. That increment usually comes at the high cost of inconvenience to citizens and loss of goodwill by the government. Citizens have punished regimes for introducing VAT, adding to the number of items or increasing the rate where the ballot box is sacrosanct and reflects citizens’ wishes. Any tinkering with VAT in the direction of adding to the burden on citizens, therefore,

requires careful consideration, consultation and enlightenment. It is not enough to argue that VAT should apply to ecommerce ordinarily. A VAT or goods and services tax applies to the increase in the value of a product or service at each stage of production or distribution. Nigeria’s VAT rate has been 5 percent since the introduction of the charge in December 1993 with effective commencement in 1994. The muted inclusion of ecommerce transactions is only one in the efforts of the tax authorities to seek more revenue. There was an earlier kite about doubling the tax rate or increasing it to as much as 15percent allegedly to be in line with the rates in some neighbouring countries. A key consideration before adding more items to the VAT list should be the impact on the cost of goods and services and quality of life of citizens. Additional revenues to the gov-

ernment should not come at the continued expense of citizens who do not as yet feel the impact of previous measures. There is also the matter of the growth of online and digital transactions. The introduction of VAT may retard the growth of our evolving digital and online payment systems and electronic commerce. FIRS should work with its counterparts to grow the online space rather than constrict it. Further, many of our micro, small and medium-sized businesses have yet to enrol and implement VAT. We consider that it is more productive to widen the net of firms registered and charging VAT for the goods and services they produce offline. Then there is the matter of accounting for the incremental value of transactions online given that the route to market often involves replication of the traditional. A significant challenge is ensuring that citizens do not suffer the jeopardy of double taxation on online purchases.

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Innovations and the fundamentals of business disruption EIZU UWAOMA

reativity and innovation is defined as intelligence having fun. The business world is a canvas. Innovation starts off from the willingness to step out of your class to colour out of the box! And just maybe a new design can be formed. It’s almost always an experiment with uncertainty of its outcome. However over the years, I have come to realize a steady pattern and trend to all great innovations, especially in business. Disruption always comes from someone external to a system. They seem like outliers at first. It’s like plotting a graph of competition over market needs with three key points that must be identified and surpassed like we do to outliers when plotting a linear or quadratic equation (outliers in mathematics are defined as points in a graph sheet that don’t fall within or follow the curve or line). But what are the three points, the outlier agents? Against competition and market needs of today, how well are your idea, firm and business answering these good old points which also coincide with the three basic economic questions taught to us in our high school? The three questions that must be answered differently to invoke disruption in any industry are: What to produce, how to produce and for whom to produce? In my years of teaching and stimulating disruption, I have thereby concluded that disruptive innovation happens when we try answering two of the three questions differently from the current industry norm. To dig deeper into this Hexavian theory of how disruptive innovation hap-

pens, let me define disruptive innovation. Disruptive innovation is when a company (most times startups) produces and eventually masters the marketing of products that seem to be simpler, superior and more affordable than the prior products in the market place, thereby creating a new value network. At this point this underdog takes a neglected market place that the incumbent leader isn’t interested in because its focus is to make better products at a better price for profit. Innovation happens every day but not the disruptive ones. Yes, not all innovations are disruptive. But when disruptive innovation strikes an industry, today’s success can be the greatest enemy of tomorrow’s success. Disruptive innovation is a strategic type of innovation. It happens when at least two of the three basic economic questions are for the first time in its industry being answered differently. Every time a market or industry is disrupted, its model is forever changed. Our world is at that point right about now, craving for us to initiate it. It is inevitable. So you’re either on the table pioneering it or you are on the menu being consumed by it. An example of disruptive innovation is what WhatsApp did to overtake the BlackBerry messenger market, or even locally, what the gospel singer Nathaniel Bassey did a few years ago when he brought Vigils to everyone’s phone for a whole month through his Halleluyah challenge (vigils on Instagram). Disruption doesn’t just start. Whether it’s by an individual or business who comes in as an underdog, takes an isolated or uncontested or neglected space by cross pollinating industries (e.g. Silverbird made beauty meet with their media brand in the 1990s and pageants were formed; IT met with banking and Interswitch was born and when the Internet met with school yearbook, Facebook was born). Since innovation can only come from something external to a system, it cross pollinates industries. And in that process, it creates a new market and value network by altering two of the three economic questions, and eventually

disrupts an existing market, displacing established market-leading firms to create new products and alliances that solve problems. Examples of disruptive firms, of underdogs making giants obsolete? Well, Wikipedia did that to libraries, Encarta and encyclopedia. Uber is currently displacing taxis across cities all over the world, the same way Google is doing that to our Atlas Maps, Netflix is doing same to cable TV, WhatsApp successfully displaced Blackberry Messenger. You too can. The ultimate trick to disruptive innovation is to define the triads of the basic economic questions. You can represent each question as the sides of a triangle – the three questions being: What to produce, how to produce and for whom to produce? Just try disrupting two of the three sides of the triangle and a totally unique business model, a new value market and a new product without competition will be created! At the heart of disruptive innovation is consumer experience. And it’s something bigger firms outgrow. They increase revenue at the expense of client intimacy and satisfaction, they become less in touch. It’s so easy to forget to look at what you do in the eyes of the customer or any other stakeholder at that as you grow. It’s a honest mistake big firms make, it’s a rule they break. It’s a Golden Rule of life and business. Once this happens, you begin to lose intimacy and value, and eventually the market! With two MBAs, years of studying innovation and over a decade of experience restructuring firms and setting them up for innovation, I have come to the summary that what kills companies is that they move strategic decision making to top management, especially finance and accounting department. Strategic decisions are now dependent on return on investment (ROI) with higher internal rate of return (IRR) and net present value (NPV) and shorter payback period, as against how truly user’s lives can be made easier, more exciting and better with their products, until a new company comes from the bottom to provide intimacy and affordability.

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Disruption doesn’t just start. Whether it’s by an individual or business who comes in as an underdog, takes an isolated or uncontested or neglected space by cross pollinating industries

To stay on top of your game for success is the greatest enemy of success. One of the best advices I have ever gotten is, “Eizu, no one is loyal to you, but their needs have to do with you.” With this, I never let a win get to my head and a loss to my heart. I have seen empires rise and fall. It starts off when we grow too big to think small and in details to the detriment of our stakeholders. It’s called neglect. From politics to relationship to business, we see this every time. Bear that in mind as you build, as you grow and scale; ensure you stay relevant by always putting the customer first. Every customer gets edgier, lazier and more price conscious with time. The antidote will be convenience and cost saving for him. Stay closer to their actual needs through feedback. Staying relevant means being disruptively innovative. There are different types of innovations, but there is one that cuts cycle time and cost for the customer. That’s what Prof Clayton of the Harvard Business School defines as disruptive innovation. Disruptive strategy isn’t only valid for businesses but our individual lives. What are we doing right now to make our lives better and easier in 40 years? How are we selling it to others and ourselves? That’s the real growth, the real innovation. The amount in profit we make today at the detriment of customer experience is very similar to the success we make at the detriment of variables like health, mental/emotional state and family. Watch it, don’t let your cost of success become high, else we’d pay too much a price to succeed that it all seems meaningless. The same mistakes big organizations make, high achievers also make. In any sphere, success is the greatest enemy of success. Sometimes we don’t make progress because we had made progress. We are all on the verge of disruption. After you stand on your feet stay on your toes. I look forward to working with you. Uwaoma is a start-up, corporate restructuring and strategy consultant. He writes via contacteizu@gmail.com

The rise of lingering challenges for CEOs

eing a CEO demands so much responsibility. It demands so much understanding. It demands leaders that will understand that their organizations cannot survive outside the environment they are in. It requires leaders who have a total grasp of the realities on ground and how those events will retard or progress their organizations. For CEOs, denial of reality, of business challenges, is a delusional defense mechanism. So too is the inability to understand clearly how the major drivers of change affect their organisation. An interesting thing about any given reality is that no matter how we try to ignore it, cover it up or deny it, it is still the reality. And based on what is going on in the global business world, the last thing any transformational leader or CEO would do is to live in his or her own world; ignoring the realities visible to other players. A leader’s primary role is planning and change. Leaders cannot transfer this role to someone else; they are needed more during times of uncertainty and economic turbulence. Leaders and CEOs should as a matter of urgency realize that regardless of how uncertain political or economic realities, they have a responsibility of creating a future. Now, more than ever leaders and CEOs

have no choice than to be adept at leading, managing, and directing change in a systemic manner. That way any form of reality will not take them off balance. Most times, it is always tempting for leaders to create quick-fix measures to drive growth and create short term stability. Taking this approach will destroy the organization and take them far away from the true reality. With the current economic situation and uncertainties, it is no more enough to create profitability and long-term growth by providing good products or services alone. In this present reality, leaders and CEOs should bear in mind that driving medium to long term growth and sustainability requires being more strategic in all facets of their business operations. With the events going on globally, no organization anywhere in the world can boast of “having arrived” or too big to fail. Additionally, the current reality does not require organizations developing only operational or tactical skills of their workforce as they may not end up becoming strategic. As a leader or CEO, you will need to be serious in developing the strategic capabilities of your workforce to prepare them to handle the changing world. As the reality persists, leaders and CEOs www.businessday.ng

must always change their thinking and embrace their new world with new mental models, or get stuck with the old ways and their obsolete thinking. The rules will keep changing and this explains why leaders should not focus on creating stability in their organizations, but rather requires a paradigm shift from creating stability to adapting to changes. Whenever I take board members on strategic thinking, it usually plays out that CEOs’ strive or focus on creating stability for their organizations especially in the face of unfavourable realities and turbulent times. The danger with this mindset is that as we try to stabilize, we forget the fact that policies, regulations, and worst of all uncertainties will always create a hole in what we have done. The most strategic thing for leaders and their organizations to do is to keep adapting to changes and think differently continuously. Adaptation proficiency is also required in turbulent times. The business realities we are currently in not only show that the world is changing, but also the competition and the customers. The sad news will be that some CEOs, executives and managers have not changed what they do in driving results, and how they do it. It is not enough for CEOs to anticipate for a better future when their organizations continue to

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UJU ONWUZULIKE

adopt the status quo method of thinking or doing things that got them to where they are today. The reality has come to stay, anyone has the right to ignore the reality, but no one can ignore the consequences of ignoring reality. Remember, no organization anywhere in the world can predict the future, but organizations that want to create their future will need to build dynamic capabilities that will help them prepare for the desired future and also thrive in it. I look forward to receiving your comments or perspectives. The trusted advisor. Onwuzulike is Nigeria’s leading authority on Systems Thinking and Strategic Management. He can be reached on 09091142093 or uju.onwuzulike@ mclgroup.net.

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Friday 09 August 2019

BUSINESS DAY

cityfile The two suspects paraded by DSS, Benin City for allegedly impersonating Vice President Yemi Osinbajo and Aisha Buhari. Pic by Churchill Okoro

EFCC arrests 29 suspected cyber criminals in Ibadan REMI FEYISIPO, Ibadan

p e ra t i v e s of the Ibadan z o n a l o ffice of the Economic and Financial Crimes Commission, (EFCC) on Wednesday, August 7,

2019 arrested 29 men suspected to be involved in internet related fraud. The suspects were arrested at Akoto Estate, Elebu area in Ibadan during an early morning raid by the commission. The team had con-

ducted series of surveillance, working on strings of intelligence gathered on the activities of the suspected ‘Yahoo Boys’. Preliminary investigation by the commission was found to be credible, leading to the sting operation.

Among the items recovered from the suspects are eight exotic cars, many costly phones and laptops, as well as documents suspected to be used for their illicit dealings. They will be charged to court as soon as investigations are concluded.

DSS parades Buhari, Osinbajo’s impersonators IDRIS UMAR MOMOH & CHURCHILL OKORO, Benin

wo suspected internet fraudsters specialising in using the name of Vice President Yemi Osinbajo and wife of the President, Aisha Buhari to defraud members of the public have been arrested and paraded by the state command of the Department of Security Service (DSS) in Benin Edo State. The two suspects were arrested on July 25, 2019 and July 26, 2019 respectively by coordinated tactical operations by officers of the command. The suspects include Amos Ehis Asuelimen

(30), a final year student of the Department of Business Administration, Ambrose Alli University (AAU) and Kelvin Godwin Ogashi (18), a fashion designer. Galadima Byange, deputy director, security enforcement, who paraded the suspects before newsmen in Benin said the suspects created Facebook and Instagram accounts to defraud unsuspecting members of the public. While explaining that other suspects are at large, he added that the two suspects will soon be charged to court. According to him, Amos Ehis Asuelimen, a final year student of AAU was arrested at Ubiaja town, Esan South-East local g ov e r n m e n t a re a o f www.businessday.ng

Edo in connection with a fictitious Facebook account bearing Yemi Osinbajo to scam people using Infinix Android phone. He alleged that the suspect successfully defrauded five persons. The DSS deputy director further alleged that the suspect defrauded people by asking them to send money and recharge cards in order to process their registration and subsequent eligibility for a loan of N100,000 each. Byange also disclosed t h a t Ke l v i n G o d w i n Ogashi was arrested in connection with impersonation of Aisha Buhari. According to him, following his arrest, the suspect confessed that he created an Instagram

account with the name and picture of the wife of the president for the purpose of swindling unsuspecting members of the public. “He further confessed to have created the account in May, 2019, with a message that the FirstLady was empowering Niger ian youth w ith cash to start up their businesses and that interested persons were required to register with money,” he said. He, however, urged youth who engage or contemplating to engage in act (s) of internet fraud or other fraudulent vices to channel their youthful life to productive venture or risk being guest of law enforcement agencies.

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BUA Cement sinks boreholes in 6 Edo communities IDRIS UMAR MOMOH, Benin

s part of efforts to making the locals have access to potable water, Obu Cement Limited, a subsidiary of BUA Group of Company has donated solar powered boreholes to six communities in Okpella, Etsako East local government area of Edo State. The cement company also inaugurated BUA-Okpella scholars h i p b o a rd t o b o o s t human capital development of academically sound indigent students studying in tertiary institutions across the six Okpilla communities. Si x s t u d e nt s f ro m each of the six communities selected by the board are to benefit from the annual scholarship programme. The six communities are O khuonmunyi, Iddo, Awuyemi, Oghute, Imiegele and Imiekuri. Idris Ahmed, the plant director, Obu Ceme nt Company wh o handed over the boreholes to the communities, said the project

w ould help to boost water needs of the communities. According to him, “ w h a t w e a re d o i n g here is evidence that Obu Cement Company Limited is committed to providing a better living condition to its host community as part of her corporate social responsibility. “We are aware that the community development agreement is going through the final stages but we have decided to go ahead with the implementation of s o m e w e l f a re p rov i sions contained in the agreement. “And one of such is the construction of boreholes to provide portable water for the people of Okpella,” he said. “O n e o t h e r t h i n g that we will be doing is beginning from next academic session in the month of September ; Obu Cement shall consider the sponsorship of 24 brilliant students from Okpella. These students will be picked from different communities to study various courses in any of the Nigeria universities or polytechnics annually,” said the director.

Banditry: Katsina bans 2 brands of motorcycle

s part of measures to check bandits and increasing criminal activities in Katsina State, the government has banned the sales and use of “Boxer and Kasea’’ brands of motorcycle in the state. Ali Tanimu, the state sector commander of the Federal Road Safety Corps (FRSC), who disclosed this to journalists in Katsina, said the ban became imperative to curtail the use of motorcycles for crime, particularly in the rural areas of the state. The sector commander, therefore, urged dealers to desist from selling the banned motorcycles in the state. Tanimu also warned tricycle operators against using tinted glasses, put@Businessdayng

ting curtain and loud music, adding that the FRSC would not hesitate to arrest anyone that violates the directive. “We are equally calling on the owners of tricycles to be checking activities of operators.’’ He said the FRSC had already commence d registration of tricycles operating in the state to sanitise their operations. “By the end of August, FRSC will commence enforcement and anyone arrested will face the wrath of the law. Our mandate covers all public roads across the state; so, we can make arrest anywhere,’’ he said. The sector commander urged the media to assist the corps in sensitising the public to dangers of violating traffic rules and regulations.

Friday 09 August 2019

BUSINESS DAY

MONEYINSIGHT

Could An Obscure Legal Process Transform Retail Lending In Nigeria?

CHINYERE OKAFOR (Guest Writer)

here is a pronounced deficit in the lending space which is evidenced by the banks’ unwillingness to pursue investments in the real sector. The Central Bank of Nigeria (CBN) in a bid to remedy this, by a circular dated July 3, 2019, stipulated that all deposit money banks (a fancy name for commercial banks) will be required to maintain a minimum loan to deposit ratio (LDR) of 60% by September 30, 2019 (the “LDR Mandate”). Failure to meet the minimum LDR by the specified date will result in a levy of additional cash reserve requirement equal to 50% of the lending shortfall of the target LDR [1]. The LDR Mandate does not, however, assuage the mind of the lenders or put measures or policies in place to guide against the risk associated with lending which includes unwillingness of some customers to pay back loans and the cost as the process of recovering such bad debts is arduous and expensive. The banks may, therefore, be more predisposed to pay the penalty of additional cash reserve than lose out on their money entirely. It may, therefore, be argued that the LDR Mandate neither holistically help the micro, small and medium enterprises (MSME) which the policy is targeted to empower nor the banks who may prefer the safer alternative of tieing up more of their cash with the CBN as additional cash reserve requirement. In the United States of America, a controversial yet very effective legal instrument called “confession of judgement” have risen to address the risks associated with lending to MSMEs and generally reduce lender apathy as it allows

the lenders retrieve their principal amount, interest and processing fees with ease. The confession of judgment refers to a type of contract (or a clause with such a provision) in which a party (the borrower) agrees to let the other party (the lender) enter a judgment against him or her upon default on the loan repayment. It allows the lender to go after the borrower’s business/personal assets as though they had successfully received a judgment against them in court. It means that the lender bypasses most of the lengthy legal process the borrower will normally be expected to go through: no trial, no hearing, no need to wait for the borrower to defend him/herself. The lender simply needs to file the confession of judgment with their county clerk or appropriate agency and the judgement is handed over to the sheriff for enforcement. The courts will then inform the borrower that a judgment has been made against them and the judgement will be enforced. In most cases, once a confession of judgement has been entered against a borrower, the borrower may be completely out of options. In rare cases, a confession of judgement may be vacated only where the borrower proves that the triggers to the confession of judgement (which in most cases includes a default in repayment) have not been set off. The controversial nature of the confession of judgement is evidenced in Janelle Duncan’s story[2] which is similar to that of tens of thousands of other small business owners in the United States of America. Janelle Duncan runs a real estate agency in Florida, United States of America. She took a loan of $36,762 from a company called ABC Merchant Solutions LLC and to the best of her knowledge, she was not defaulting on her loan. However, on the order of a court in New York (out of the jurisdiction of both Janelle and ABC Merchants Solutions LLC), her accounts were frozen and subsequently, $52,866.93 (monies held by her for landlords) withdrawn from the said account. Upon inquiry, Janelle found out that a “confession of judgement” was entered against her. Before Janelle obtained the loan, amongst other loan application documents, Janelle signed a confession of

judgement. Could confession of judgement, stripping off its controversial nature, be adapted to a more salubrious situation in Nigeria? Possible Adaptation The average middle- and lowerclass Nigerian is faced with access to credit catch-22 conundrum. The banks are not predisposed to give loans to them because they have no/insufficient collateral and no credit rating. They cannot get a credit rating because they do not have access to loans. This unending cycle is what our proposal aims to remedy. Although the deployment of confession of judgement as a legal instrument can be abused, access to credit is an upside that the legal instrument has generated. The question we then seek an answer to is “how do we come up with a variant of the confession of judgement that can mitigate/eliminate the possibility/risks of it being abused?”. The underlying principles of the confession of judgment can either be adopted in Nigeria as a law (in its entirety or as modified to fit local realities) or enforced as a contractual term. Where it is to be adapted as a law it must, of course, go through the rigorous law-making process, the first of which is advocacy. Without needing to go down that rabbit hole, the most realistic form of immediate and cost-effective adoption of the principles of confession of judgment (although not in its entirety) is to have the parties contractually provide for it either as a clause in their loan documentation or as an add-on document to the loan documentation process. Possible Application and Operationality Notwithstanding the foregoing, the inclusion and application of the principles of confession of judgment are worth pursuing as it exponentially increases access to credit which has the effect of increasing industry, jobs and the overall wellbeing of the recipients of the loan. From the CBN’s report, as at Q1, 2019 there exists a credit gap of over N1.7 trillion that could be lent to individual Nigerians, but which lenders are scared to extend because there is no sufficient legal infrastructure to provide a costeffective and timeous means of

enforcing debt collection. Adapting the confession of judgement may very well be the answers to unsaid prayers. A “confession of judgement clause” may, therefore, be included in a standard loan agreement (especially those lacking in collateral) unequivocally waiving the borrower’s rights to information and representation upon specific trigger events, one of which is usually a default on the loan repayment. To tamper with its strict provisions, the clause can be set up in such a manner that the trigger would be a culmination of more than one factor or the occurrence of multiple events. The loan documentation should also have a precedent term of settlement signed by both the lender and the borrower which will be held in escrow by a third-party agent. This third-party agent (who should ideally be a trustee because of imbued fiduciary obligations) will neither be representing the borrower or the lender but will rather be representing the transaction. The lender will only have access to the terms of settlement which will form the basis (in concert with the principal loan agreement) upon which the courts will mandate enforcement. These documents held in escrow will only be released after the third-party agent has verified the occurrence of the trigger events. An actual test for the efficacy of this proposition is to have a contract drawn up with such a clause in existence. Its application may or may not be challenged and put to a test depending on the disposition and/or financial strength of the debtor. Where, for instance, the loan amount is N50,000 and the cumulative loan amount, interest payment and accompanying charges is N80,000, the debtor is less likely to go to court to contest the fairness or otherwise of the terms considering the fact that it might cost substantially more to do so. Its efficacy and general applicability may only be tested where the amount in question is more than the cost of litigation or the debtor is bent on proving a point (which is less likely). Full disclosure by the lender to the borrower of the principles underlying the confession of judgement document or clause and the effect of same will also serve as a deterrent to borrowers seeking to contest same upon default

because they cannot at a later date plead lack of knowledge. As an additional measure, an additional clause may be inserted to read that the “the nature and effect of the confession of judgement was explained to the borrower and the borrower seemed to understand same before executing the relevant document and that the borrower was not coerced into signing the document”. Likely Challenges Although the cardinal principle of law of contract is that a person is free to enter into a contract with any person he or she chooses and that parties to a contract are allowed to contract on any terms they want, the injustice occasioned by the oppressive use of exclusion and limiting terms has warranted the courts to limit the scope and effectiveness of those terms. Inherent in this freedom of contracting right is the presumption of equality of contracting parties negotiating on equal footing, having equal bargaining power, and who are equally able to look after their own interests having a full understanding of the consequence of their actions. This presumption is oftentimes false. The courts will, therefore, frown at contracts that are too onerous. Onerosity is determined by the courts on the basis of stare decisis (historical/precedent cases), considering the terms of the contract and the relationship of the parties and other contractual principles. There may, therefore, be an initial pushback from the courts on the basis of terms in a contract which they interpret to be unfair. The contra proferentum (which is Latin for “against the offeror”) rule is yet another item to consider. This is a rule in contract law which states that any clause considered to be ambiguous (which the debtor might claim the judgement of confession clause is) should be interpreted against the interests of the party that requested that the clause is included. The likelihood of this rule acting as a bulwark against the enforcement of the clause is unlikely. This, however, does not preclude it from being forefront in the mind of the drafters.

• Chinyere Okafor is the head Counsel, Legal and Compliance at Trium Networks Limited.

IPAN business network breakfast seeks to improve Nigeria’s quality infrastructure ...deliberates on nutritional supplements, food additives STEPHEN ONYEKWELU

he Institute of Public Analysts of Nigeria (IPAN) has launched a business network breakfast series aimed at addressing contemporary issues in Africa’s most populous nation’s quality infrastructure as it concerns the practice of laboratory analysis. “I wish to make a clarion call to all of us to keep faith with the IBNBS and endeavour to jointly nurture it” Aliyu Angara, registrar, CEO of the Institute

said at the launch. The maiden edition of the IPAN Business Network Breakfast Series (IBNBS), focused on the benefits and harmful effects nutritional supplements and food additives, in order to provide analytical guide for manufacturers and consumers. “It is common among professional groups to hold such breakfast meetings. Today we are discussing the issues around nutritional supplements. As public analysts, we want to understand the dynamics; what are food supplements, benefits, and www.businessday.ng

implications,” said William Onwuka, principal consultant, Fine Spectra Consult Limited, a quality management system consulting company, he is also a fellow of IPAN. “The outcome of this breakfast meeting will help us advise the public, National Agency for Food and Drug Administration and Control and the Standard Organisation of Nigeria, regarding food supplements; since we are a sub-unit of the Ministry of Health.” Food or nutritional and herbal supplements have been quite popular in the country for some years.

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They are often packaged in tablets, pills, capsules or liquid forms, and they can be vitamins, minerals, herbs or other botanical plants. Nutritional supplements in the form of vitamins have recorded considerable growth because of the easy availability and affordable nature of such products in Nigeria. Consumers continue to demand such products because of their effectiveness in maintaining a healthy body. “Nutritional supplements are not substitutes for healthy, balanced diets. A diet that includes plenty of fruits, veg@Businessdayng

etables,wholegrains,adequate-protein, and healthy fats should normally provide all nutrients needed for good health”KukoyiEbunoluwa,aregistered dietician said at IBNBS in Lagos. IPAN is a Chartered Regulatory body (IPAN Act CAP. 1 16 LFN 2004) for all testing laboratory analysts in Nigeria who are supervised by the Federal Ministry of Health. The Institute is statutorily charged with the responsibility of regulating the practice of laboratory analysis as well as registering and regulating analytical laboratories in Nigeria.

Friday 09 August 2019

BUSINESS DAY

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Friday 09 August 2019

BUSINESS DAY

COMPANIES & MARKETS

COMPANY NEWS ANALYSIS INSIGHT

INSURANCE

Cornerstone Insurance’s premium income hits 7-year high in H1 ...bottom line rebounds to positive territory after Q1 loss ISRAEL ODUBOLA

ornerstone Insurance Plc, a Lagos-based provider of life and non-life insurance services, grew premium income by 13 percent to N6.1 billion in the first half of 2019, the highest in six years. Meanwhile, bottom line otherwise known as net income rebounded to positive territory as the insurer gained N545.4 million in the second quarter of the year, after a net loss of N43.7 million in first quarter, to bring after-tax profit to N501.7 million in the first half period. Net premium income of the insurer, however, slowed some 2 percent as reinsurance expenses grew faster than gross premium income. Yet, net underwriting profit of Cornerstone rose 3.9 percent to N3.46 billion, thanks to receipts from fees & commission which surged 49 percent. A breakdown of gross premium written revealed that the insurer realized

N5.02 billion from nonlife life segment, which accounted for 65 percent of total N7.71 billion total premium income. Fu r t h e r b re a k d o w n based on ser vice type showed the insurer earned N1.11 billion premium from

general accident, trailed by N964 billion from oil & gas and N706 billion from motor insurance, with the three accounting for a combined 72 percent share. Underwriting profit of Cornerstone appreciated to N1.06 billion in the review

period, from N698.2 million last year, indicating a double-digit growth of 52 percent. A dive into the company’s financing activities showed that borrowing costs were down by half, while proceeds from sale of foreign

currency denominated assets nearly tripled to N11.1 million in the review period, from N4.3 million a year earlier. Investment income attributable to shareholders fund trended upwards to N551.1 million from N420

million posted last year, thanks to spike in dividend income. Meanwhile interest income contracted some 5 percent to N354 million. Meanwhile, shares of the insurer have remained flat at 22 kobo since last Monday (August 5), but have gained 10 percent since the start of the year. The stock outperforms the insurance stock gauge and market benchmark index that has lost 15 and 12 percent respectively. As at the period ended June 30, 2019 Cornerstone Insurance’s total assets stood at N32.1 billion, representing some 12 percent uptick over N28.7 billion posted last December. A further look at the insurer’s balance sheet s h ow e d t hat ab ou t 4 2 percent of its total assets comprise financial assets valued at N13.7 billion. The insurer equally grew owners’ fund by a quarter to N12.8 billion from N10.2 billion last year. The company is into life and non-life insurance business, and provides accident, sickness, motor life, burglary, equipment and life insurance products.

MANUFACTURING

Thomas Wyatt’s loss in Q1 worsens despite improved sales SEGUN ADAMS

rebound in revenue was not enough to see stationary maker, Thomas Wyatt, turn the corner in the first quarter ended 30 June as the company’s losses grew to N16.74 million. Thomas Wyatt announced its bottom line grew weaker by 38.16 percent from a loss of N12.11 million last year. This extends a spell in the first quarter from 2017, based on available company results. Thomas Wyatt’s performance faltered on the heels of higher expenses and higher borrowing cost while other income slumped. In the quarter, revenue grew 33.87 percent to N17.02 million after a slowdown in the corresponding period of

L-R: Francis Mechioye, chairman, Manufacturers Association of Nigeria (MAN), Ikeja Branch; Omobolanle Ogunmola,permanent secretary, Ministry of Commerce, Industry and Cooperatives, Lagos State, and Mansur Ahamed, president, MAN, at the associations Ikeja Branch 52nd Annual General meeting in Lagos.

2018 and an increase in the cost of sales had doubled the company’s loss.

Cost of sales was 8 percent higher in the period but Thomas Wyatt posted its first

in more than three years. Cost to Sales margin, the proportion of expenses generated

per N100 sales, dropped from 118.23 percent to 96.15 percent in the period. The stationary maker did not earn rental income in the quarter even though it made N450,000 the year before. Sundry income also saw a big decline which brought total income from outside Thomas Wyatt’s core operation to N44,000, 94 percent lower than previously noted. Administrative cost was higher by some 48 percent fuelled by a sharp rise in Outsource services, Repair and maintenance, Personnel cost while Advertising and Marketing promotions cost which was absent in 2018 weighed on the company. Distribution expenses also took its toll as Thomas Wyatt incurred more than double of N703,837 spent last year. Operating losses

increased from N10.32 million to N11.82 million on account of the rise in cost. Thomas Wyatt’s finance cost spiked 39 percent from N1.5 million triggering a loss before tax of N16.44 million, about 39 percent from the year before. The company’s tax increased slightly in the period while loss attributable to each unit of share rose to 8 kobo, 2 kobo m o re tha n i n th e f i rst quarter of 2018. Shares of Thomas Wyatt have remained unchanged since price advanced to 42 kobo late June. So far, the shares have gained 82.61percent year-to-date. Thomas Wyatt Nigeria manufactures stationery products which include calendars, brochures, cards, deposit slips, certificates, envelopes, among others.

Editor: LOLADE AKINMURELE (lolade.akinmurele@businessdayonline.com) Graphics: David Ogar

Friday 09 August 2019

BUSINESS DAY

COMPANIES&MARKETS

Business Event

INSURANCE

NSE lifts suspension on Universal Insurance’s shares OLUFIKAYO OWOEYE

he Nigerian Stock Exchange (NSE) has lifted the suspension placed on the trading in the shares of the insurance company after it successfully filed its audited Financial Statements for the year ended 31 December 2018 with the regulator. “The suspension of trading in the Issuer’s securities shall be lifted upon submission of the relevant accounts provided The Exchange is satisfied that the accounts comply with all applicable rules of The Exchange. The Exchange shall thereafter also announce through the medium by which the public and the SEC was initially notified of the suspension”.

Universal Insurance Plc, with 10 other firms were suspended on July 2nd by the NSE over non-compliance with Rule 3.1, Rules for Filing of Accounts and Treatment of Default Filing, Rulebook of The Exchange (Issuers’ Rules) (Default Filing Rules”), which provides that: “If an Issuer fails to file the relevant accounts by the expiration of the Cure Period, The Exchange will: (a) send to the Issuer a “Second Filing Deficiency Notification” within two (2) business days after the end of the Cure Period; (b) suspend trading in the Issuer’s securities; and (c) notify the Securities and Exchange Commission (SEC) and the Market within twenty- four (24) hours of the suspension.” Meanwhile, after an initial

delay in the release of its financial results which led to the suspension in the trading of its shares, UniversalInsurancehasreleased its 2018 full-year result for the period ended 31st December 2018 and Q1 2019 result for the period ended 30th March 2019. Analysis of the full year 2018 show gross premium written increased to N1.68bn in the full year 2018 as against N753mn in previous corresponding period, claims expenses declined to N262mn in full year 2018 from N462mn in the full year 2017, loss for the period stood at N45.5 mn in 2018 compared to 635mn profit in 2017. In its Q1 financial result gross premium written doubled to 650mn for the period from N346mn in the corresponding period in 2018.

L-R:Olufemi Agboola, head teacher at the main campus in Ebute–Meta;Debisi Salako, proprietress of Tender Age Children School;Jadesola Agoro, Grade 3 Honor Roll Student; Fahizol Kalejaiye, Grade 5 Honor Roll Student, and Olubisi Dosumu, Veteran teacher for 16 years at Tender Age, at the end of the school’s transition assembly to mark the end of the 2018/2019 academic session.

COMPANY RELEASE

Nexford stresses need to prepare graduates for workplace SEYI JOHN SALAU

exford University has emphasised the need to produce graduates that can match up with demands of the labour market. According to officials of the next-generation university, producing graduates that match the requirements of the workplace remains a top priority. Speaking, Nexford University’s Founder and Chief Executive Officer, Fadl Al Tarzi, said lack of required skills was an impediment for many youths to secure their desired jobs. “With the rapid advancement of tech, skills are the only barrier between ambitious youths across the world and attractive economic opportunities. Our next-generation university focuses on precisely this,” Al Tarzi said. “Worldwide, young people are three times more likely than their parents to be out of work. Jobless levels of 25 per cent or more are common in Europe, the Middle East, and Northern Africa. In the Organisation for Economic Cooperation and Development (OECD) countries, more than one in eight of all 15 to 24-yearolds are not in employment, education, or training.

“Around the world, the International Labour Organisation estimates that 75 million young people are unemployed. Including estimates of underemployed youth would potentially triple this number. This represents not just a gigantic pool of untapped talent; it is also a source of social unrest and individual despair,” a statement from the university read. It also added, “At Nexford, skills are the new currency. The university surveyed Fortune 500 companies and analysed millions of job vacancies to create a curriculum that delivers on the skills in highest demand. Nexford’s relevant, online educational model, therefore, addresses the systemic skill-gaps. Its students master the skills they need for day one at work, such as how to present a business strategy. “In addition, students pay flat-fee monthly tuition similar to a monthly phone bill, which is designed to be less of a burden. Students are never locked into a long-term commitment and pay the same monthly fee, regardless of number of courses or credits. The faster you finish the less you pay.” On her part, Olamidun Majekodunmi, Nexford’s Manager in Nigeria, urged local

universities to abandon the legacy approach and educate students based on the skills workplaces seek. Majekodunmi said, “Solutions like Nexford are welcomed and I look forward to tracking success stories. Critically informed by employer needs in order to create a direct-to-employer pipeline, Nexford is designing a competency-based, intuitive learning system that caters to each individual learner.” She also advised Nigerian universities to adopt responsive approach as practised by Nexford. “For Nigeria, this is an especially hard-hitting realisation. There are 34 million Nigerians who are unemployed or underemployed. We have a spiking population and an even higher spiking youth population, yet our higher education practices remain irresponsive to this looming catastrophe,” Majekodunmi said. “Nigerian graduates are not lazy but are unprepared for the workplace. Major themes surrounded the fact that graduates are not well equipped with the soft and hard skills required to operate in today’s dynamic work environment. “Nexford University is doing our bid to change this,” she added.

L-R: Chris Okafor, chairman, local organising committee on communications, International Conference of Medical Rehabilitation Professionals (ICMRP); Akanle Olufunke, registrar/CEO, Medical Rehabilitation Therapists Board of Nigeria (MRTBN) and Adeniran Akinyele, deputy registrar, MRTBN, at media briefing on the forthcoming 2nd International Conference for Rehabilitation Professionals in Lagos.

L-R: Olalekan Olugbemi, winner of 2019 Young Managers’ Competition of the Nigerian Institute of Management (Chartered), receiving the star prize from the Pat Anabor, deputy president of the Institute, flanked by Tony Fadaka (r), registrar/chief executive of the Institute, and Jude Iheanacho (l), director of Capacity Building of the Institute, at Management House, Lagos.

KAS Prints partners Canon with eyes on versatile digital colour printing

AS Prints will rely on Canon’s innovative technologies to provide its customers with the best innovative printing services. The collaboration allows Canon Central and North Africa (CCNA) to combine their mutual know-how to provide KAS Prints customers with unique and unmatched services. Canon’s continued investment in research and development offers KAS Prints confidence that they are using tech-

nologies specifically designed to improve their productivity and data security. Canon appreciates that customer expectations in the digital and printing industries are constantly evolving which has an impact on business models in all imaging sectors. Integrated and intelligent applications allow businesses to reduce the complexity of challenges related to their environment and contribute to positive value creation. Kas Prints has found in

Canon a trusted partner with whom “we share the same values and is committed to helping us successfully anticipate our customers’ needs especially in our offering of the latest solutions,” according to Ademola Kasumu, the Managing Director and CEO of the printing company. “Canon’slong-standingexperience in the digital and printing world encourages the emergence of innovations that will transformservicedeliveryforour customers,” Kasumu said.

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L-R: Onyeka Luis Osita Osadebe of the Late Stephen Osita Osadebe, Afam Dozie,Convener, HRH Igwe John C. Nwosu,Ezechimeleze the Eze Ndigbo of Mushin Lagos, Steve Onu,Convener and Oranu Hillary Ikechukwu also a convener at the brand unveiling of the Osadebe Fest in Lagos.

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Friday 09 August 2019

BUSINESS DAY

AGRIBUSINESSINSIGHT Market Insights

Analysis

Commentaries

Experts/Industry Views

Commodities watch

Policy Reviews

Send in Commentaries to caleb.ojewale@businessdayonline.com

Takeaways from BusinessDay Agribusiness & Food Security Summit: The Economic Impact of Agritourism in Nigeria (2) Fake seeds, ‘ban’ on fertiliser: Inputs present plethora of challenges for farmers (1) Cont. from previous publication

Stories by CALEB OJEWALE Twiiter: @calebtinolu

here is a practise where ‘grains’ are sold to farmers instead of ‘seeds’, and when this is done, the eventual yield would not meet the expected outcomes. To be clear, what is called a seed, can qualify as ordinary grains when it has been merely saved from harvests by either a farmer or trader. Such grains will germinate quite all right, but without giving the same output as actual seeds, for instance, giving one tonne per hectare instead of ten tonnes. Those referred to as actual seeds, are supposed to have gone through a special breeding process, which is done to ensure it delivers one or a combination of values such as disease resistance, pest resistance, herbicide tolerance, and more importantly for many; higher yields. “It may be difficult to differentiate between a seed or a grain, and it is a lot harder to tell where there have been adulterations or counterfeits are being sold to farmers,” said Kabir Ademoh, local coordinator, Seed for Change. “What needs to be done is reaching out to farmers, educating and introducing them to quality seeds through competent companies”. Garbage in, garbage out, this aptly describes the outcome when either ‘fake’ seeds or adulterated fertilisers are used on any farm. In Nigeria today, there appears to be a dearth of knowledge among farmers, on getting authentic, hybrid, and appropriate seeds. The same knowledge gap exists in the purchase and utilisation of other farm inputs and agro inputs. As noted by members of the panel on ‘The Role of Quality Inputs’, during this year’s agribusiness and food security summit, unless urgent actions are taken to address this, there will be a significant effect on

How to Increase Agritourism in Nigeria overnment Efforts: No doubt, the government has a huge role to play in the growth of Agro tourism and in Agriculture in general through either setting favourable policies or supporting rural farmers with funding and making it easier for tourists to visit. A research by FN Nnadi and CD Akwiwu recommends that for agro-tourism to contribute to rural development in Nigeria, the national policy on tourism should be reviewed to be trendy with modern tenets. Also, private initiative and involvement in tourism should be encouraged. Nominal compilation of actual and potential agro-tourism sites in the nation should be undertaken in addition to launching extension education campaign on agro-tourism. 2. Attract Tourists with Videos: have you seen those ads? The ones that say “Visit Dubai” or “South Africa Tourism?” They capture the essence of the country by showing the rich historic culture of the country, tourists visiting, and hospitality. We can adapt this same strategy to agritourism. By promoting videos that show the beauty in Agriculture, we can attract people from other countries to tour our rich agricultural landscape. 3. Social Media: A great tool for creating new connections, building relationships, communication and sharing information, social media can go a long way in promoting agritourism in Nigeria. Another big benefit of social media is you can promote any message to millions of people around the world for free (from your personal, corporate or friend’s account) or at a quarter of the cost compared to what it would be if you were using other media. Individuals can organize social media campaigns to promote their agritourism business while engaging with those interested on a personal level. Likewise, organisations can leverage social media influencers to promote attractive agritourism packages to their followers. 4. Preserve: Civilization and the influx of tourists to a certain region will lead to diversity and pulling

food production in the country, and it is not likely to be a positive one. “Seed is very important as far as crop productivity is concerned,” reiterated Ekum O jogu, an Agricultural Development and Food Security Expert at the National Agricultural Seeds Council (NASC). “For you to get improved yields, seeds contribute between 45 and 50 per cent of yield.” As Ojogu explained during the summit, when a farmer “gets it wrong from the seed perspective, productivity will be equally wrong”. If one brings a grain of maize and a seed of maize, it will be difficult to differentiate, and this according to him is why regulating the seed sector is important, so that what farmers plant is not grain but seed. He also highlighted what is described as a challenge in the sector, where early generation seeds are not giving the right productivity, on account of dearth in research. “Over time varietal improvements have not been done,” he said. However, all hope is not lost as Ojugu explained that; in the end, if a farmer gets seeds which do not meet what the company that produced it promised, they can go to NASC offices in any geopolitical

zone and such a seed company can be prosecuted. In the end, proper knowledge on farm practices also matters, as Ademoh noted, “It is one thing to sell good inputs to farmers, and another for it to be properly utilized.” “When farmers have any problem on the farm, they blame the seeds,” said Wanger Akaazua, operations manager, Afri Agri. “There are hybrid seeds with varying resistance to diseases, but most farmers don’t care to know the type of seed they are buying in the first place, so they could buy a seed and grow it in the wrong way.” Ac c o rd i n g t o h i m, m o s t farmers use chemicals as they please, worsened by chemical store attendants who do not know better. A farmer could ask for a chemical that can kill weeds, and whereas such a farmer is looking for a systemic herbicide, due to lack of knowledge, they are given anything to spray and may not get the desired results. The knowledge gap as he notes, is huge limitation that needs to be addressed on the side of farmers, and even those they rely on for information within their immediate environments.

down old structures to erect new ones. While this is certainly geared towards growth, it may be best to preserve certain environments, tools and processes in order to retain intrigue. Once the Agro environment no longer holds any intrigue or things that people haven’t seen before in their countries, it will be hard to hold their interest and encourage a repeat visit. 5. Incentivize: Another way to promote agriculture tourist activities is to use incentives. Incentives have long been used as a promotion tool for businesses and if your business is going to benefit from agritourism, you can put together a program that would entice tourists to patronize your business. An example of such incentive is a loyalty program, discount or tourist pack, which can include personal items like tour brochure, torch, toothbrush, etc. 6. Education: The stunted growth of agritourism or agrotourism in Nigeria can be largely blamed on lack of enlightenment and education programs on the benefits of tourism. If a farmer or people in the agriculture value chain can see the immense benefit of attracting tourist to their business, then they will be more receptive in creatively attracting tourist attention. A major benefit of Agro-tourism is that it leads to a significant injection of cash into the agricultural ecosystem. Whether it is recreation, direct agricultural sale or educational experiences, here are some agritourism activities and some of the ways in which agro tourism generates income for agricultural enterprises: Horseback riding; Wildlife viewing & photography; Fee fishing; Camping/picnicking (combined); Fee hunting; Crosscountry skiing; Game preserve; Offroad vehicles; School tours; Garden/ nursery tours.

Continues online @ www. businessday.ng • Hannah Edia is the Lead SEO/Content Development at Farmcrowdy. When she is not writing, she enjoys working out. Check her out on Instagram @ trainwithhannah

How dangerous are GMO foods in Nigeria?

enetically Modified Organism (GMO) foods according to a school of thought can cause cancers and other diseases in humans, but to others, it is simply a way of solving specific agricultural problems. What then is the true position and risks involved in its consumption? The genetic attribute that makes sugarcane sweet, if a person can discover it, such a gene can be taken and inserted in bitter leaf to make it as sweet as sugarcane, provided the procedure is successful. At this point, that bitter leaf can be said to have been genetically modified, narrated Rufus Ebegba, director general, National Biosafety Management Agency (NBMA), during a recent interactive session with agriculture journalists in Lagos.

His analogy was given to describe what a typical genetic modification objective could be, and as he stressed, “people tend to believe the agency is promoting GMO, but we don’t promote GMOs neither are we against them.” “Our role is to make sure they are safe for human use, consumption, and to the environment,” he said. Considering the fact that genetic engineering is a very powerful tool, if it is not regulated, it can be abused and result in organisms that are harmful either to the environment or human beings. Ebegba identified known concerns about GMO as follows; Environmental concerns • Production of super organisms such as super weeds in the case of herbicide tolerance species could occur. www.businessday.ng

• The GM crop can also become suddenly invasive. Maybe the maize with herbicide tolerance goes beyond what is expected, it could become so strong as to destroy all other crops, perhaps because it has the ability to tap more nutrients and other crops can no longer survive. • GM crops should not target insects unduly. A GM crop may have been bred to resist a particular insect but it should not affect any other one as this could make it affect biodiversity. It must be specific. If GM beans is to target weevil as a pest, it should not kill butterfly for instance, which is a pollinator and should be protected. Human aspect: • It must not cause toxins. For instance if beans is genetically modified, people should not

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consume it and start falling sick. • It must also not cause allergies. Some people may eat groundnut and have rashes and if it is GM groundnut, it must have not higher allergic impact more than its natural counterpart. Social impact Cultural values and norms have to be respected in genetic modification. For instance, the Muslim community does not consume pork. Therefore, inserting pork gene into sorghum meant for consumption will be unacceptable. Even if such insertion will be done, the product must be clearly labelled. When this labelling is done, it then becomes consumer choice, and this labelling is already made mandatory by law. The part that is perhaps of more concern to most people; can GMO @Businessdayng

cause cancer? “Cancer has been in existence even before the advent of GMOs. Therefore, there are no verifiable evidences linking GMO and cancer,” said Ebegba. According to him, the Food and Agriculture Organisation of the United Nations (FAO), World Health Organisation (WHO), and Codex Alimentarius Commission have so far not found any linkages between GMO, cancer or any other diseases in human. According to him, Nigeria has “a very good laboratory where we can detect any genetically modified organism. We can detect the smallest, minute aspect of it in the laboratory”. As at the time of publishing this article, there is no known scientific evidence linking GMO foods and diseases such as cancers in humans.

Friday 09 August 2019

BUSINESS DAY

IMPACT INVESTING

In Association With

Impact investment favours expats over African entrepreneurs. Here’s how to fix that

ows of white faces stare out from the social media meme showing tech startup executives circulating among young Kenyans, who are angry that foreign entrepreneurs attract more capital than they do. A young Kenyan entrepreneur, almost in tears, told us she needs a white face to front her start-up if she is going to raise capital. Village Capital found that 90% of the capital invested in East Africa in 2015-2016 went to a very small group of expatriate-founded businesses. The impact investment field is now valued at $502 billion per year, according to the Global Impact Investing Network, and is a growing source The most influential actors in Nairobi’s entrepreneurial ecosystem are incubators, accelerators and impact funds. REUTERS/Thomas Mukoya of finance for businesses of all kinds in Africa. However, there are many issues This self-fulfilling cycle gets accentu- turn out to be a wild goose chase, manage a young, growing, business. on the ground that means that capital ated by new entrant investors follow- can damage the business itself and Entrepreneurs have to spend time is not necessarily reaching the most ing the crowd and adding capital to leave entrepreneurs exhausted and informing the foreign investor about the market and their business which frustrated. impactful business models and that a handful of “successful” businesses. Why investor behaviour matters Most impact investors seek com- can significantly distract from running the promised returns may not be realDiscussions with entrepreneurs in mercial returns and few, if any, make the business itself. This can be very ised. There appears to be a gap in understanding between foreign impact the Ashoka network in East Africa, and an explicit trade-off between com- damaging to the business during the process of fundraising and can even investors and local entrepreneurs that a survey of members of the Schwab mercial and social returns Impact investors offer entrepre- reduce the value of business itself. needs to be bridged if capital is to be al- Foundation for Social EntrepreneurAn example of excellent behavlocated to locally-founded businesses ship, have highlighted several areas of neurs access to capital they would concern in the way that impact inves- otherwise not be able to source lo- iour was an investor who reviewed a with long-term growth potential. So what is going on? The vast tors behave towards entrepreneurs cally. Impact investors may accept business plan, together with detailed greater risk than more conventional financial projections, took it to their majority of impact investment firms and the terms they offer. Experience suggests there is a need investors by offering unsecured loans investment committee who decided operating in Africa source funds from outside Africa and most make invest- for much greater knowledge of local and early stage equity investments, not to invest, all within 6 weeks. The ment decisions outside Africa too. Re- markets and a need for greater trans- often without a clear exit. However, key here was that the locally-based cent evidence suggests that the biases parency in their interactions with en- most still seek commercial returns investment professional had worked and behaviour of foreign impact inves- trepreneurs, if capital is to be allocated on the capital they invest. This is of- for years in that sector and understood tors may not lead them to investing in efficiently and effectively. Some areas ten not clear to local entrepreneurs, the value of the business and was keen who understand the daily trade-offs to invest; but his colleagues outside the local entrepreneurs with the best of concern are highlighted below. Impact investors often do not they make in building a business ad- Africa did not. chance of long-term financial success Investors lack staff who have have any funds to invest but do not dressing market failures that delivers and social impact. hands-on business experience tell entrepreneurs they don’t have measurable social impact. A growing backlash Entrepreneurs often receive advice Innovation attracts funds regardThere is a growing backlash against any money about how to run their business from Investors are frequently fund- less of local relevance impact investors among local entreTo attract early stage investment, staff of impact investors who have preneurs in Africa, who are becom- raising, but most do not tell the ening increasingly frustrated at the bias trepreneur that they do not have the local entrepreneur’s business must never run a business themselves and investors have shown in favour of funds available and will have to raise now be perceived to be highly innova- who may have little knowledge of capital before they can actually invest. tive, typically involving the use of ICT, the local market. Entrepreneurs freexpatriate-founded business. Often expatriates bring northern Many of these investors are seeking a often combined with a northern busi- quently complain that they have been business models to the south, but may pipeline of projects to aide their fun- ness model. Conventional ‘bricks and asked to change their business model fail because the founders lack under- draising and use business ideas from mortar’ businesses are looked down (route to market, product range etc) against their own business judgment, standing of the practical and political contacts with entrepreneurs, often on and are hard to sell. without their permission. Most investors do not have a clear or invest in new staff as a condition of realities on the ground. investment, but with no guarantee of Entrepreneurs can waste a lot of investment process Furthermore, the vast majority of The process of moving from first securing the investment. Many have these foreign start-ups are focused on time engaging with investors, believa narrow sub-sector of industries, with ing that they are able to invest, when engagement to disbursement of funds made these changes only to be let ICT as the main feature of what are they do not have any funds. The time can be lengthy and time-consuming down at the point of investment when perceived by investors to be exciting entrepreneurs waste on what may for busy entrepreneurs struggling to the investor pulls out. Most influential actors tend to be and innovative business models. expatriates who have no prior experiWhile the application of ICT ence in entrepreneurship leading to across a wide range of sectors in Afmarket distortion and poor decisionThere is a critical need to involve experienced rica, particularly financial services, making can have a big social impact, this local business people in the investment The most influential actors in the investor bias excludes other, more Nairobi entrepreneurial ecosystem conventional sectors of the econodecision-making process. While local business are incubators, accelerators and my, viewed by local entrepreneurs impact funds. According to research as having more relevance and sigpeople may not want to work for investment conducted by Endeavor and the Bill nificant long-term growth potential & Melinda Gates Foundation, these and social impact. funds they could join in-country advisory or, organizations are mainly led by indiThe impact of these biases is that ideally, investment committees that make viduals who have no prior entrepreexpatriate-founded businesses attract neurial leadership experience and most of the capital and, as a result, decisions often tend to be expatriates who have grow faster than businesses started by very limited understanding of the local local entrepreneurs who lack capital.

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market context. Additionally, these organizations are funded primarily by grants from donors, governments and corporations. This has been cited as a major influencing factor as to why businesses struggle to scale, as these groups are sending the wrong signals to the entrepreneurs they support and can create grant dependency. Local entrepreneurs are often poorly-equipped to engage with foreign investors on their terms. The majority are raising investment for the first time and are inexperienced, naïve and unprepared, resulting in a mismatch between northern impact investor expectations and the local entrepreneur’s hopes and capabilities. Foreign investors typically expect sophisticated financial models and detailed business plans which, in their eyes, reflect the calibre of the entrepreneur and by proxy the business itself. Local entrepreneurs will have different, frequently qualitative, skills, market insights and valuable social capital and political networks, crucial to business growth and long-term sustainability. However, this unique local knowledge and social capital are valued less highly than quantitative skills in the due diligence process. There are examples of expatriate-owned businesses running into serious political difficulties because of a lack of political awareness, insights and networks. How to improve investor decision-making It is clear to the authors that there is a large gap between foreign investors and local entrepreneurs and that capital is not invested in an efficient manner that supports the growth of early stage African businesses. There is a critical need to involve experienced local business people in the investment decision-making process. While local business people may not want to work for investment funds they could join in-country advisory or, ideally, investment committees that make decisions. There is a small but growing pool of local angel investors whose insights and capital could be leveraged by foreign investors to find and support local entrepreneurs. Donors/investor consortia need to invest in locally-managed entrepreneur support networks to help find and support new businesses. There is a need for more effective linking of local business people with young entrepreneurs supporting them by becoming mentors, or nonexecutive directors. There is a need to promote standards of good practice for engagement of impact investors with entrepreneurs and vice versa. Good practice would include honesty in communication, setting out a clear investment process and decision-making points. This could be a written voluntary code of good practice developed by key networks.

Friday 09 August 2019

BUSINESS DAY

Advertise Here Companies should be compelled to backward integrate to earn EEG – Shuaibu Idris

FBN, Eventful support SMEs in the fashion industry 23

NELSON MANDELA: The Epitome of Ethical Leadership in Africa and the World 23

Are we ready for CBN policy on milk? CBN, Nigerian apex bank, announced the coming of a policy that has rattled the dairy industry stakeholders. SIAKA MOMOH went down memory lane to bring you the story of Milk in Nigeria and its embattled makers.

e are not, like the Lagos Chamber of Commerce and Industry said in a press statement sent to Non-Oil Digest; and like the Manufacturers Association of Nigeria (MAN) said too. But when will we be ready? We may never be ready for a long time to come if we go by past debates on the issue. Those who are familiar with the story will agree with this writer that we have gone through this path before and we ended up not stopping importation of milk. We will come to this shortly, but first, let us look at the Central Bank of Nigeria (CBN) policy. CBN milk policy The CBN disclosed its plan to add milk and other dairy products to the list of restricted products on the foreign exchange market few days back at the end of July Monetary Policy Committee (MPC) meeting. Godwin Emefiele, CBN Governor, said that the restriction was to boost local production of dairy products and increase investment in ranches within the country. He noted that Nigeria currently spends about 1.2 billion dollars to 1.5 billion dollars annually on milk importation. The CBN has, in the midst of public outcry by some interest groups against the CBN policy on milk vigorously explained “there is neither a plan nor a decision to ban the importation of milk into the country,” an act it said it had no legal power to take. It said its plan was to conserve between $1.2 billion and $1.5 billion the country spends on the importation of milk every year. What else does this mean? Ban of course, going by informed players’ argument in the business space. Treading on familiar path Back in 2012, this writer spoke to the CEO of a pacesetting milk maker. The company is involved in backward integration. It commenced the programme in 2010. He was asked what the status of the company’s dairy development programme was. His response: • All the milk collection centres we have built are operational. The yield that we get from those centres is on the increase. • At the moment as at April we have collected the highest we have ever collected – 7000 litres per day. • But that is still a small drop compared to the volume of milk that we process. We process 500 million litres per day. So if we look at the volume, it is still very small.

• But it is a long yielding process – it is not a process that you start and you get the result immediately. • You have to be patient; you have to invest in it, which is what we are doing today. • We are not making profit from it yet, because we believe in the potentials of Nigeria. It is a gradual process and we believe we will get there.” • The breed of our cows, the weather condition, the availability of good pasture, availability of water, good roads (which are all on the low side), are the things that are making it very difficult for us to be self sufficient in dairy milk production now… • If you go to where our parent company is situated, you will find out that you have to take care of the entire value chain – from grass to glass, right from the field where the cow is treated, to how you milk the cow, to how you process the milk, and eventually how you package it as a finished product that the consumers will buy.”

So it is clear here the development programme of the dairy firm in question, that is backward integration programme, which government policy on milk calls for, is hampered by some challenges - breed of Nigerian cows, the weather condition, the availability of good pasture, availability of water, good roads (which are all on the low side). Also going down memory lane, Siaka Momoh is priviledged to draw from his story on the trending issue of milk in question published in BusinessDay in July 2012, to drive home the point that we are treading on a familiar terrain. He can recall that dairy industry stakeholders in the country then were locked in a battle of wits over envisaged government plan to ban importation of milk into the country. It was believed if the push being made in some quarters to make government ban importation of powdered milk into the country fell through, several milk manufacturing plants would shut down. The likes of

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Promasidor, an 80 per cent dairy firm, FAN Milk, FrieslandCampinaWAMCO, producers of peak milk, Chi, etc. all would go, industry stakeholders argued then. According to industry sources then, local production of fresh milk in Nigeria was less than .1 per cent and the investment outlay for fresh milk production was robustly high and could not immediately be met. Moreover, the infrastructure support such as power, water, etc, and the required cows for the project were not available and affordable. As at the time the July 2012 story by Siaka Momoh was being done, government pronouncement on the report submitted by the Presidential Committee on Tariff Initiatives headed by Bukola Saraki, then governor of Kwara State, was still being expected, yet some stakeholders in the dairy industry who package powdered milk were shocked by the speculation on an impending ban on impor-

Continues on page 24

Friday 09 August 2019

BUSINESS DAY

Business Chief

Companies should be compelled to backward integrate to earn EEG – Shuaibu Idris Shuaibu Idris, CEO TimeLine Consult Ltd, a finance expert and former deputy managing director Dangote Flour Mills has over 20 years experience in industry and consulting. SIAKA MOMOH took him on industry’s troubling issues of Export Expansion Grant (EEG), backward integration and expatriate quota. Export Expansion Grant (EEG) or Shuaibu Idris, introduction of the payment of Export Expansion Grant (EEG) to exporters of Nigerian products by the Federal Government is a fine and appropriate move. The thought process, according to him, was that Nigeria should be able to expand its export commodities base and that Nigerian commodities should be able to compete favourably with products from others countries. He explained, “On ground is a situation where products from Latin America or Asia are sold to Europe or America, and Nigeria’s prices are at a disadvantageous position – meaning the prices of our products are higher than those of other products from those continents. The provision of EEG is meant to assist the Nigerian exporter to be able to be competitive pricewise. “So for example, if even I export at one dollar per Kg and actual cost of the production of that commodity is $1 10 cents, government gives me about 20 percent of whatever I export, I am able to get at least 20 cents from government. So technically, if I export at $1, I will be selling at a loss of 10 cents – that is without profit. If I am getting 20 cents from government, I am able to sell at a profit because the 10 cents loss I would recover from the EEG and still be left with another 10 cents as profit. I think this is a very laudable initiative by government and the effort has to be commended particularly the government President Ibrahim Babangida who introduced the EEG that is still being sustained over the years through Abacha’s regime up to Obasanjo’s regime, down to the current government of President Muhammadu Buhari.” N350 billion backlogs Stakeholders in the industry claim exporters are being pushed into greater financial distress with their banks and financiers as a result of non-payment of N350 billion EEG claims. Reacting to the claim, Shuaibu says thin it is a situation where the exporters may be complaining and the government also having issues with the exporters He explained: “Historically, there have been challenges. Number one, at a time either during Abacha’s regime or Abdusalami’s regime, the EEG was abused significantly by a number of exporters. People were exporting basic agric commodities without necessarily adding any value and still claiming EEG. “It was a monumental abuse and the government at that time de-

Idris

cided to introduce an amendment to the scheme and the amendment was such that not every exporter will get the same amount of grant, meaning that there was a graduation of scale. “The revised guidelines were released and effective from January 1, 2017. To facilitate implementation, a budgetary provision of N20 billion was made in the 2017 budget for settlement of the grant. Highlights of the Revised Guidelines are as follow: Exporters are divided into four categories with maximum applicable EEG rates as indicated below: • Fully manufacturedproducts:15% • Semi-manufactured products: 10%. • Processed/intermediate products: 7.5% • Merchants/primary agricultural commodities:5% “PricewaterhouseCoopers Limited was assigned the responsibility to redesign the EEG for which then there was a component of calculation of value addition which I think was a laudable step. Even then the abuses did continue.” For him, “There is no correlation between the amount of money being demanded by exporters and the quantum of goods being expected. I bet you, if you were to index it, if you do a typical research, and take the quantity of commodities exported and match with the grant paid, you will find out that they do not correlate. NEPC will need to do a lot of Monitoring and Evaluation(M&E).

“I think it is very easy. Government can call the exporters concerned and tell them ‘We owe you N350 billion, what are you going to do for the economy if we pay you the N350 billion? Will you just take the money and pocket it, buy cars, repatriate the money? Or are you going to create a value chain with the money? If government can do this, it will go a long way in helping the economy.” Questions that need be addressed He argues another challenge most exporters had was the process of discounting the certificate given. Says he: “You know the grant is usually given to exporters in form of a certificate which is a negotiable instrument, and holders of the negotiable instrument are able to use it either to pay customs duties or certain forms of taxes including corporate income tax that the Federal Inland Revenue Service (FIRS) charge companies. There were times that the Nigerian Customs rejected the certificate. There were times also that the FIRS did reject the certificate. “However, I think those challenges were addressed and the system was running efficiently and effectively. I think if anything, as at today, some of the challenges government is having, and that some of us are having, is that it has reached a point where we need to step backward and take a cursory look at the implementation of this scheme and address the following questions: What was the goal? What was the objective for the introduction of

the scheme? The objective from the name connotes a grant meant for expansion of export, so it is a grant from government meant for the expansion of the export base of Nigeria. Now, 25 years down the line, from the time when this scheme was introduced till now, has the Nigerian export base been expanded? If yes, by how much? And if no, why has it not been so?” He argues exporters associations such as Gum Arabic Exporters association, Tannery association, Sesame Seeds, Cashew-nuts, Ginger exporters associations all need to sit down to review the scheme. “They can say, yes, our members have received so much support from government, how much have we given back to the society? How much have we given back to government? How much has our taxation improved? How much have we broadened the export base of the economy?” Challenge for government agencies He says the National Planning Ministry, and in fact, the Nigerian Export Promotion Council (NEPC) need to do a holistic review of the implementation of this scheme, from its inception to date, with a view to ascertaining what extent government is getting the value for which it set out to achieve when it first conceived and introduced the scheme. In other words, M&E is key. For him, “Unless we do this and show to the general public and to those in authority that there is indeed an effort, and there is indeed value for the amount of money government is giving as grants to exporters, it would be near impossible for government to just continue to dish out the hand-out without the exporters showing the value either in terms of employment generation, in terms of taxation that they pay to government. We need to look at where we were in terms of tonnage. And in terms of contribution to the GDP. Unless you get that value, government will always be apprehensive and say ‘Hey, wait a minute, you are asking for N350 billion as grant, if we are to give you this N350 billion that you said has accrued, what do we get? What is in it for government?” Backward integration On backward integration, he says, the issue is, if I were to recommend to government, there is need to holistically take a second look at the implementation of the EEG scheme. “The view is that there is need to introduce a bit of a covenant. Before you are allowed to access EEG, you must put in place a mechanism to have a backward integration. For example, if you

are a cashew-nut exporter, government can still give you grant to export cashew however subject to you having a plan to make sure that you process cashew locally and you add value instead of exporting raw cashew. President Obasanjo did something similar with cement licensing importation. And what he did was that he made sure that he would not give you licence to import cement until you have a plan to start a cement production factory and the target was that Nigeria must be a net exporter of cement after a particular period of time. And today, to God be the glory, because that policy was doggedly implemented and followed, we are now a net exporter of cement.” For Shuaibu, “NEPC should not just wait for government to tell it what to do. Why should we allow a large conglomerate to continue export large quantities of sesame seeds when they can have a sesame seed processing factory locally? You can crush the sesame seed; you can extract the oil, export the oil, and export the cake. You can do same for cashew-nuts and ginger. And most of these companies are foreign owned - Asian and European companies. We just take government money and give to them without necessarily getting anything back!” Reflecting on possibilities that would have been thrown up if things were done properly he says: “Imagine in the period of implementation of the EEG, in the last 25/30 years that it is being implemented, if for example, we have a bubbling tannery business where hides and skin are processed and shoes and bags are made with them, why wouldn’t we get a Gucci or a Lew Button come here to set up a factory to produce the bags? Why should we be taking our hides and skin to China for peanuts? And we end up getting our ladies buy Lew Button bags for 1500/ 2000/5000 pounds when the revenue could have remained in Nigeria! We can do same for our other agric commodities. Why wouldn’t we compel them to have processing plants here?” For him, “So long as we want to solve the problem of insecurity, the problem of unemployment, government need to diversify the economy, grow our GDP. We need to grow our manufacturing base, we need to have some level of policy that will insist on some level of covenant that will insist that you will get this amount of grant from government but we insist also that you do some other things. If we do not do this, we will just be throwing money down the drains.” • Read the rest of the story in www.realsectornow.com

Friday 09 August 2019

BUSINESS DAY

Leadership

NELSON MANDELA: The Epitome of Ethical Leadership in Africa and the World Celebrating 10 years of international Mandela day (2009-2019) SIAKA MOMOH

t all happened in Lagos, at Eko Hotel and Suites on July 25, 2019 at the July Breakfast Meeting of Nigeria-South Africa Chamber of Commerce. South African Consul General in Lagos, Mr Darkey Africa delivered the keynote speech. He recalled that whilts in the dock on 20 April 1964, Madiba Nelson Rolihlahla Mandela immortalised the following: “I have fought against white domination, and I have fought against black domination. I have cherished the ideals of a democratic and free society in which all persons live together in harmony and with equal opportunities. It is an ideal for which I hope to live for, and to see realized. But my Lord, if needs be, it is and ideal for which I am prepared to die”. Mandela-on life and leadership He recalled too that the Madiba said the following on life and leadership: • In real life we deal, not with gods, but with ordinary humans like ourselves, men and women who are full of contradictions, who are stable and fickle, strong and weak, famous and infamous. • This underlines the in judging our progress as individuals, we tend to concentrate on external factors, such as our social standing and position, influence and popularity, wealth and standard of education. Honesty, sincerity, simplicity, humility, pure generosity, absence of vanity, readiness to serve others, is the foundation of one’s spiritual life. • essence of ethical Develop-

ment in matters of this nature is inconceivable without serious introspection- without knowing yourself, your weaknesses and mistakes. • Leadership. • Never forget that a saint is a sinner who keeps on trying. • The best weapon is to sit down and talk - dialogue and negotiation are key to human progress and development. • We can build each other if we know ourselves. Africa said Barack Obama once said of Mandela - ”Even when faced with the temptation to seek revenge he saw the need for reconciliation and the triumph of principle over mere power. Why Mandela is the epitome

of ethical leadership Said Darkey Africa: • He was driven by conscience, dedication and commitment to his cause. • Endeared (not through money) himself to his people, Africa and the World by making difficult choices (life or death). • He led by example. Would not urge anyone to do anything which he would not do himself. • Had respect for the dignity and rights of all persons black or white. • Embraced universal values of trust, honesty, consideration, fairness, justice etc. • Abiding and deep love for humanity. • Had high moral leadership.

Fashion Business

FBN, Eventful support SMEs in the fashion industry

s part of efforts to provide access to market and provide opportunities for entrepreneurs in the Small Medium Scale Enterprise (SMEs) of the fashion industry, First Bank of Nigeria Limited partnered with Eventful Nigeria Limited on its event, fashion souk, a platform that creates an opportunity for players in the fashion industry to exhibit and sell their wares to the thousands of event participants. Speaking at the event held in Lagos recently, the Group Head, Marketing and Corporate Communication, First Bank of Nigeria Limited, Folake Ani-Mumuney, said the bank has over the years, since its founding, been very supportive of the entrepreneurial space and SMEs, adding that the role of the bank is that of an enabler. “FirstBank has been involved in every sector of the economy since 1894, so if you think about that

there is no sector we have not been involved in, in fact this particular fashion souk, we are the pioneer sponsor and we sponsored it right from when it started.” Ani-Mumuney explained that the fashion industry over the years has grown incredibly and added that it has helped to grow other businesses. According to her, “Just like Nigerian music, the fashion industry is still

in its infancy. We have great talents and potential in the fashion industry. Let’s consider the developed fashion industry of Italy for instance and the entire value chain of fashion, it tells you that there is a lot to be done. We still need to have fashion zones in core Cities and States, so that within a particular zone, you could have the cutters, button hole creation and others…

Editor’s Note

ou are welcome once again on board your luscious non-oil business magazine dedicated to diversification f the Nigerian economy. The trending news on the dairy industry is on our cover this time around. Siaka Momoh went to town to bring you a robust story on the recent CBN’s planned policy on milk which has rattled this complete food industry. He notes that we have gone through this path before and that we may not be ready for what the policy intends to achieve for a long time to come if we go by the brainstorming on the issue in the past and now. Yours sincerely spoke to Shuaibu Idris CEO TimeLine Consult Ltd, a finance expert and former deputy managing director Dangote Flour Mills who has over 20 years experience in industry and consulting, on industry’s troubling issues of Export Expansion Grant (EEG), backward integration and expatriate quota. For EEG, he advises we should take a cursory look at the implementation of this scheme and address the following questions: What was the goal? What was the objective for the introduction of the scheme? Now, 25 years down the line, from the time when this scheme was introduced till now, has the Nigerian export base been expanded? If yes, by how much? And if no, why has it not been so?

Siaka Momoh

He says this and more on EEG and the other issue. Customers want capabilities that retailers haven’t been able to offer. Now manufacturers are responding to customers’ desires. The customer now dictates. Patricia Seybold calls it sweet surrender. She means the manufacturers who traditionally is called the king, has now surrendered to the power of the customer. Enterprise Strokes brings you the rest of the story tagged Customer Revolution. Read all above and more in our package for this month.

• For advert placements, sponsorship, reactions, editorial contributions, contact SIAKA through siakamomoh@ yahoo.com; 2348061396410; 23408023033988.

Highlights of Second Quarter 2019 Manufacturers CEOs Confidence Index (MCCI) survey

he Second Quarter 2019 Manufacturers CEOs Confidence Index (MCCI) survey was conducted by the Manufacturers Association of Nigeria (MAN) primarily to feel the pulse of the manufacturing sector. The MCCI examined manufacturers perception using a set of diffusion factors which include: Current Business Condition, Business Condition for the next three months, Current Employment Condition, Rate of Employment, Employment Condition for the next three months and Production Level for the next three months. It also measured the performance of the sector by analyzing the general macroeconomic condition (Foreign Exchange, Lending Rate, and Credit to the manufacturing sector and Capital Expenditure of the Government) and the business operating environment (Over-regulation, Multiple taxes/levies, Access to sea ports, Local raw-material sourcing, and Government patronage of Nigerian manufactured goods and Inventory. Chief Executive Officers (CEOs) of MAN member-companies across the six geo-political zones of the country and the ten Sectoral Groups of the Association responded to special purpose questionnaires designed for data gathering. The information provided by these respondents was utilized without making any reference to specific companies and the result thereof is expected to strengthen the advocacy positions of the Association.

Macroeconomic Performance Of all the MAN CEOs interviewed, 46 percent disagree that the rate at which the sector sources foreign exchange (forex) has improved. 36 percent however agreed while the other 18 percent are not sure that forex has improved. The response thus suggests the need for a production focused forex policy and improvement in the quantum of forex available to the sector, particularly for importation of machines, rawmaterials and other manufacturing inputs that are at the moment not available in the country…

• Read the rest of the story in www.realsectornow.com

Friday 09 August 2019

BUSINESS DAY

Are we ready for CBN policy on... tation of milk while those in fresh milk production believed the ban should come because such move will protect their business. Zimbabwean farmers in Shonga, Though Allan Jack, the leader of the white Zimbabwean farmers in Shonga, Kwara State, in his presentation at the Presidential Committee on Tariffs Initiatives which held in Ilorin, said “if milk is banned someone is going to bring the money to fund local production of milk”, document made available to BusinessDay proved otherwise. According to the document, “Nigerian dairy industry stakeholders are producers and marketers of dairy related products to consumers not farmers or milk producers. We have expertise in processing and marketing but not in primary dairy production.” The document gave extrapolated cost for producing 1.5 billion litres of milk as $1.32 billion (N196.2 billion) for initial set capital and $2.18 billion (N323.0 billion) for running cost – for farm size of 500 hectares. Total hectares required to produce 1.5 billion litres of milk was put at 300,000.

the pains they suffered from Robert Mugabe’s land seizures back in Zimbabwe . The banks in question were Guarantee Trust Bank (GTB), old Intercontinental Bank, Unity Bank, old Fin Bank and old Bank PHB own 75 per cent equity in the Shonga Farms Holding arrangements and the State government owned 25 per to make 100 per cent of the Holding. And currently, Lagos Chamber’s fear For Lagos Chamber of Commerce and Industry, CBN’s action is a ban on importation of milk. In a press statement signed by Muda Yusuf its director general, “From all indications, the Nigerian economy is not ripe for the policy. For all practical purposes, it is tantamount to a ban on importation of milk in whatever form as most banks would not process Form M for any product on the CBN forex exclusion list.” He argued: “The commitment of the CBN to the backward integration agenda of the Federal Government is laudable. However, it is important that in seeking to achieve this objective, the sequencing and strategy must be right. The policy will do more harm than good to both investors and the citizens. It would trigger avoidable disruptions and

environment needs to be created for these investments to happen. “The forex exclusion policy being contemplated by the CBN will create a crisis of immense proportions in the dairy industry supply chain and put investments worth billions of dollars at risk. Indeed, the entire food and beverage sector would be adversely affected as many are dependent [in varying degrees] on the use of milk as intermediate products. They include investors in the production of Yoghurt drinks, chocolate drinks, infant formula for children, beverages, producers of ice creams, producers of cereals consumed largely by children and many more.” Muda Yusuf argued further: “There are over one million direct and indirect jobs that will be in jeopardy across the value chains of these industries. These companies engage Nigerians as employees, distributors and retailers and additionally, thousands of suppliers and service providers are dependent on these businesses for their livelihood. For a country that is grappling with unemployment crisis, the consequences will be too grave. Therefore, there are profound investments, economic, nutritional and social issues to worry about.”

Other requirements given in the document include 544 Farms each housing 500 cows; water requirement per cow - 30 litres / cow per day (non lactating); 60 litres / cow per day when lactating with 20 hectares of pasture irrigation (210 litres water per litre milk produced). Danger ahead Concerned stakeholders did not see how the funds required for of all that are stated above could be met then. They went on to state in the document that the following would be under threat from premature bans and penal duty rates: 500 000 direct employees; 1.5 million; indirect employees; investment last three years totalling N15 billion – new factories etc; Duties paid: N 480 million; VAT paid: N 960 million; PAYE paid: over N1.5 billion per annum; Pension Contributions: circa N1 billion per annum; Corporate Tax: Circa N 30 Billion last three years. Zimbabwean farmers in Shonga, Kwara State, who. According to industry sources then, were victims of credit squeeze from their bankers, were fingered as the arrowhead of the group pushing for the ban to protect their farms established in Nigeria in 2005 as reprieve from

dislocations in the investment environment and further undermine investors’ confidence. It would create huge supply gaps in the market with severe harmful consequences.” He said we currently do not have dairy cows in the country and that the dominant milk producing system in Nigeria is the Fulani Nomadic System whose cows have a milk yield of less than two litres a day, “whereas a good dairy cow will produce an average of 28 litres of milk per day over ten months”. He argued: “During peak lactation, a high yielding dairy cow can produce as high as 60 litres of milk per day. The reality is that Nigerian cows have very low yield because of poor genetic composition, poor feeding practices and the laborious nomadic system of breeding. These are fundamental issues that we need to fix before contemplating any form of import restriction. These are challenges to be posed to the Federal Ministries of Agriculture and Water Resources at the federal and state levels as the present administration moves to the next level. These are the agencies of government that have primary responsibilities for such matters. The

Adverse implications For the Lagos Chamber DG, such a policy move will have the following adverse implications: • It will boost the smuggling economy since there will be an estimated 50% short fall in the supply of dairy products to the Nigerian market. • The supply gaps will create scarcity and put the prices of the products beyond the reach of the average Nigerian. • There will be loss of revenue to the government as smugglers naturally move to fill the supply gaps in the market. • There is a major risk of closure/ drastic scaling down of operations of existing investments in the Dairy Industry. • There will be a higher risk of malnourishment of citizens especially children and the low-income earners. • There will be heightened risk of loss of jobs in the dairy sector • Neighbouring countries will profit from the increased smuggling triggered by the policy, as the Nigeria ports and maritime sector workers loose revenue and jobs to the ports of the neighbouring countries.

Continued from page 21

The customer revolution

his is a familiar terrain for Patricia B Seybold. Patricia Seybold is the celebrated author of The Customer Revolution, the book that tells you, you are no longer in control of your business, of your company’s destiny and goes on to teach you how to thrive when customers are in control. The Customer Revolution is a strong message for all who are in business in this age. At a class session in the Pan Atlantic University not too long ago, , one of the lecturers in an entrepreneurship management class related her experience in her popular neighbourhood shop. A staff at the shop, a supervisor was rude and uncaring to her as a customer. This was a shop where she buys items worth more than N20, 000 every month, so she was not a first time customer. Does it even matter if she was? She took a decision right there – she stopped patronizing the shop. She is a customer, she is in control. Listen to Patricia Seybold, you will hear the beat of the customer revolution loud and clear. She says executives in a variety of industries have begun to feel the impact of the customer revolution. She offers you their stories: Arne Frager is the president of The Plant, a professional music recording studio in Sausalito, California. Arne’s been in the music business for 27 years and he’s never seen the flow of new music dry up before. Arne Frager: “My recording busi-

MAN’s fear For Segun Ajayi-Kadir, DirectorGeneral of MAN, the addition of milk to restricted items would have a negative impact on the economy that might lead to downsizing, reduce government revenues and the manufacturing sector’s contribution to GDP. He said the CBN’s decision was taken unilaterally without consultation with operators in the dairy industry. “It is a fact that to backward integrate is the way to grow an economy, but there is a need to be strategic and deliberate about the way to implement the measure.MAN has always been at the forefront of resource-based industrialisation; and has always supported backward integration, that is the reason why many manufacturers are exploring local sourcing of raw materials. What CBN wants to achieve is almost the same but the style of approach differs and the timing,” he said. Policy should be put on hold Going by the argument put forward here, the general consensus is that we should put on hold the CBN policy on milk for now and set a new comfortable deadline for implementation. Lagos Chamber’s Muda Yusuf’s following recommendation fits in here:

ness is off 50 per cent. The whole music recording business is off 50 per cent this year (2000). About half the revenues in our industry come from new acts. But the big record labels are so paralysed by the MP3/Napster/ Nutella/Freenet free distribution of digital music that they are not signing any new acts! Without the labels paying for the production of new albums, our studio isn’t recording.” Customers taking things into their hands have profoundly altered the landscape of the music industry. That is customer revolution for you. Brennan Mulligan is president of Timbuktu2 designs, a U.S.-based manufacturer of backpacks and messenger bags. His testimony: “Customers love the ability to custom-design their backpacks. But there is just no way to convince retailers to take custom orders in their stores. They can’t handle one-off products. So we’ll go direct to the customer and do it on the internet. Customers can design their own backpacks, we’ll ship them out the next day, and if the retailers want to participate we’ll set up shop on their web sites and put kiosks in their stores, too!” Customers want capabilities that retailers haven’t been able to offer. Now manufacturers are responding to customers’ desires. The customer now dictates. Patricia Seybold calls it sweet surrender. She means the manufacturers who, traditionally is called the king, has now surrendered to the power of the customer. So note that the customer is important. • Enough timeline should be given to diary companies for a sustainable transition from the current state of affairs to the desired level of backward integration in the dairy industry. • There should be robust incentives to attract investors to the supply chain in the dairy industry in line with the backward integration aspiration. • The ministries of Agriculture and Water resources should take on the challenge of driving this change process through the creation of incentives for modern animal husbandry facilities and practices. There should be generous support from Government to facilitate the importation of cattle breed [dairy cows] suitable for milk production. On account of the foregoing, we urge the CBN to put on hold its proposal to exclude the dairy industry investors from the Foreign Exchange Market in order to save the economy of the consequential shocks, business disruptions, investment dislocations and job losses. Less we forget, Fulani herdsmen and need for ranches. There is an urgent need to stop the traditional nomadic system. The Shonga business model is available for adoption.

Friday 09 August 2019

Harvard Business Review

BUSINESS DAY

MANAGEMENTDIGEST

The elusive green consumer that it can be an effective motivator but should be used carefully. — THE RATIONAL APPEAL: Research has shown that people are unlikely to undertake a behavior unless they have a sense of what researchers call self-efficacy — confidence that their actions will have a meaningful impact. Thus one key to marketing a sustainable product is communicating what effect its use will have on the environment. Although information about sustainable behaviors and their outcomes can be persuasive, how the information is framed is critical, especially for products with high upfront costs and delayed benefits.

KATHERINE WHITE , DAVID J. HARDISTY AND RISHAD HABIB PEOPLE SAY THEY WANT SUSTAINABLE PRODUCTS, BUT THEY DON’T TEND TO BUY THEM. HERE’S HOW TO CHANGE THAT. n the surface, there has seemingly never been a better time to launch a sustainable offering. Consumers — particularly millennials — increasingly say they want brands that embrace purpose and sustainability. Yet a frustrating paradox remains at the heart of green business: Few consumers who report positive attitudes toward ecofriendly products and services follow through with their wallets. We have been studying how to encourage sustainable consumption for several years, performing our own experiments and reviewing research in marketing, economics and psychology. Much of the research has focused on public interventions by policymakers — but the findings can be harnessed by any organization that wishes to nudge consumers toward sustainable purchasing and behavior. Synthesizing these insights, we have identified five actions for companies to consider: use social influence, shape good habits, leverage the domino effect, decide whether to talk to the heart or the brain and favor experiences over ownership.

USE SOCIAL INFLUENCE In 2010 the city of Calgary, Alberta, had a problem. It had recently rolled out a program called grasscycling, which involves residents’ leaving grass clippings to naturally decompose on a lawn after mowing, rather than bagging them to be taken to a landfill. The city had created an informational campaign about the program, but initial adoption rates were lower than the city had expected. One of us (Katherine White) advised Calgary to try to change residents’ behavior using “social norms” — informal understandings within a social group about what constitutes acceptable behavior. Scores of studies have

shown that humans have a strong desire to fit in and will conform to the behavior of those around them. To leverage this motivation, White and her colleague Bonnie Simpson worked with the city on a large-scale field study in which messages were left on residents’ doors: “Your neighbors are grasscycling. You can too.” Within two weeks this simple intervention resulted in almost twice as much residential grasscycling as did the control condition. Social influence can be turbocharged in three ways. The first is by simply making sustainable behaviors more evident to others. In some of White’s research, people were asked to choose between an eco-friendly granola bar and a traditional granola bar. The sustainable option was twice as likely to be chosen when others were present than when the choice was made in private. A second way to increase the impact of social influence is to make people’s commitments to eco-friendly behavior public. For example, asking hotel guests to signal that they agree to reuse towels by hanging a card on their room door increased towel reuse by 20%. A third approach is to use healthy competition between social groups. In one example, communicating that another group of students was behaving in a positively viewed way made business students more than twice as likely to compost their biodegradable coffee cups.

SHAPE GOOD HABITS Humans are creatures of habit. Often the key to spreading sustainable consumer behaviors is to first break bad habits and then encourage good ones. Three subtle techniques can help shape positive habits: using prompts, providing feedback and offering incentives. Prompts might be text messages reminding people to engage in desired behaviors, such as cycling, jogging or commuting in some other eco-friendly way to work. Prompts work best when they are easy to understand and received where the behavior will take place and when people are motivated to engage in the behavior. Feedback sometimes tells people how they performed alone and sometimes compares their performance to that of others. Household energy bills that show how consumers’ usage compares with that of neighbors can encourage energy saving. Incentives can take any number of forms. In the U.K., CocaCola has partnered with Merlin Entertainments to offer “reverse vending machines” from which consumers receive half-price entry tickets to theme parks when they recycle their plastic drink bottles. Incentives should be used with care, because if they are removed, the desired behavior may disappear too. LEVERAGE THE DOMINO EFFECT

One of the benefits of encouraging consumers to form desirable habits is that it can create positive spillover: People like to be consistent, so if they adopt one sustainable behavior, they are often apt to make other positive changes in the future. After Ikea launched a sustainability initiative called Live Lagom (“lagom” means “the right amount” in Swedish), it studied the sustainability journey in depth among a core group of its customers. The company found that although people may begin with a single step — such as reducing household food waste — they often move on to act in other domains, such as energy conservation. DECIDE WHETHER TO TALK TO THE HEART OR THE BRAIN When getting ready to launch or promote a product or a campaign, marketers often have a choice between emotional levers and rational arguments. Either can be effective — but only if certain conditions are met. — THE EMOTIONAL APPEAL: People are more likely to engage in a behavior when they derive positive feelings from doing so. This core precept is often overlooked when it comes to sustainability, for which ad campaigns are likely to emphasize disturbing warnings. Research has found that hope and pride are particularly useful in driving sustainable consumption. Guilt is a more complicated emotional tool. Research by White and colleagues suggests

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

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FAVOR EXPERIENCES OVER OWNERSHIP Along with working to change consumer behavior, some companies have found success with business models that seemingly make consumers more open to green alternatives. In the “experience economy,” companies offer experiential options as an alternative to material goods. In addition to the potential sustainability benefit, research shows, giving an experience makes both giver and receiver happier, leads to stronger personal connections and cultivates more-positive memories. MAKING SUSTAINABILITY RESONATE Using marketing fundamentals to connect consumers with a brand’s purpose, showing benefits over and above conventional options and making sustainability irresistible are central challenges for businesses in the coming decades. As more and more succeed, sustainable business will become smart business.

Katherine White is a professor and the academic director of the Dhillon Centre for Business Ethics at the University of British Columbia’s Sauder School of Business. David J. Hardisty is an assistant professor at the University of British Columbia’s Sauder School of Business. Rishad Habib is a doctorate candidate in the marketing and behavioral science division at the University of British Columbia’s Sauder School of Business.

Friday 09 August 2019

BUSINESS DAY

HEALTH BUSINESS&LIFE How Nigeria can leverage diaspora input to transform healthcare

ANTHONIA OBOKOH

espite the massive migration of medical personnel out of Nigeria, the country’s diaspora still has a key role to play in Africa’s most populous nation’s healthcare transformation. In Nigeria’s healthcare sector, it is well known that many doctors jump at the first exit opportunity from the country in search of greener pastures seeking better work conditions and pay abroad. The World Health Organisation recommends a doctor to about 600 people. Nigeria currently has about 35,000 doctors serving a country with an estimated 200 million people. This implies the country still needs about 237,000 doctors. According to the Nigerian Sovereign Investment Authority it is estimated that Nigeria spends $1bn on outbound medical tourism each year. However, what the healthcare sector loses in service delivery, talents and human resource can be gained in investment opportunities and remittances from abroad. For countries with a large diaspora population such as Nige-

ria, doctors and other healthcare personnel’s are significant part of influencing the healthcare space and creating opportunities to explore an available resource for development in the sector. Experts see Foreign Direct Investment (FDI) in Nigeria as a necessary medium for deals in hospitals and clinics to enhance treatment abilities, improve in medical technologies advancement are a booming development and boost the healthcare services in Nigeria. “Attracting FDI into the healthcare sector requires deliberate policy work by Government with regards industrialisation and FDI in order to ensure that investors are attracted to the healthcare industry. This could start with including healthcare into the National Industrial Revolution Plan among other similar tools utilised to drive investments into the country,” Chibuzo Opara co-founder of Drugstoc said. Analysts say Nigeria’s health sector remains a good and attractive industry to do business in, with huge opportunities and high-profit margin up to 70 percent. More investment will bridge the noticeable gap and also help in eliminating the issue of medical

tourism, analysts say. “FDI has an act in Nigeria health sector as it influences why the country has some hospitals and diagnostic centres with expensive high-tech equipment that are nonexistent or broken down in many government hospitals, said Doyin Odubanjo, chairman, Association of Public Health Physicians of Nigeria, Lagos Chapter. The net effect of migration of skilled labour is negative, more so if what these medical personnel’s send back is money for building specialist facilities, upgrading and collaborating with the Governments. But now the message is clear - Nigeria needs to take advantage of its departed labour more by using direct diaspora investments. Nigeria’s medical device market will record double-digit growth in local currency and will grow at a 2017-2022 CAGR of 9 percent to reach $184.4 million by 2022 and predicts healthcare expenditure to reach N5,762.061bn by 2021 at CAGR of 8.35%, says the report by Fitch Solutions. To take advantage of the growing interest, these experts say for Nigerians in diaspora more personnel’s can harness the avail-

able opportunities and as well as private healthcare providers extend well beyond the pharmaceuticals, hospital establishment can key into more importations in highest demand of supplying magnetic resonance imaging, radiotherapy machines, digital X-ray, ultrasound and mammography machines, CT- Scans and anesthesia kits. These areas hold great potential as Nigeria looks to expand health care access and coverage “The Nigerian medical device market will witness a strong growth rate in the medium to long-term future is driven by improved economic conditions and the introduction of a foray of new companies with technological advancements,” Research and Markets also predicts. Nigeria is expected to grow more in the share medical device market. This is owing to rising intravenous usage of technology in the state and the rising cost of healthcare, which stimulated the development of innovative connected products. According to the Nigerian Investment Promotion Commission, a myriad of investment opportunities exist across the healthcare

value chain in Nigeria and investors interested in taking advantage of these opportunities will benefit from taking a long-term view of the market and keeping into consideration the dynamics of healthcare investment in developing nations. The United States of America, (USA) based healthcare expert and a leading member of the League of Nigerians in Diaspora, LNID, Shegun Olagundoye urged that investors and professionals in the Diaspora to return home to invest in the large potentials that abound in the nation’s medical tourism and other sectors of the economy. “With the current favourable investment environment, if our compatriots heed this call, Nigerians in Diaspora can turn the country to a global medical tourism center within the next seven to ten years.” “Nigeria government should starts looking at regulations that make things easier especially for the field of medicine where it is so unique that is very hard to get these products any other way than to bring it outside the country for now,” Hammed Ninalowo, a vascular and interventional radiologist said.

NNPC, SNEPCo cancer machine reduces treatment waiting time by 80 percent ANTHONIA OBOKOH

T L-R: Sophia Baah, COO, mPharma; Eugene Kweku Boadu, head, Corporate Affairs, mPedigree; Idris Bello, partner, LoftyInc Allied Partners Limited and Temie Giwa-Tubosun CEO, LifeBank during the ‘Accelerating the Power of Social Entrepreneurs’ conference organised by Skoll Foundation recently in Lagos.

Ogun intensifies polio immunisation with supplemental exercise YEMISI FASHOLA, Abeokuta

he Ogun State Primary Health Care Development Board (OGPHCDB) has commenced the August 2019 Supplemental Immunization Activities (SIAs) with the administration of Fractional Inactivated Polio Vaccine (FIPV) along-side Oral Polio Vaccine (OPV) to all eligible children in Imeko-Afon, Ipokia and Yewa North Local Government Areas of the state. Ayinde Adesanya ,the Permanent Secretary, Ministry of Health, who made this known during a mini flag-off exercise held at Primary Health Centre, Imeko, said the introduction of fIPV programme which kicked off from Thursday, August 1 through Tuesday, August 6, 2019, in the three Local Government Areas was a follow up to the Outbreak Response (OBR) 1 and II earlier carried out in the state. He said the immunisation campaign in these areas would be dif-

ferent from those conducted in the other 17 local government areas as mothers and caregivers would be required to bring their children and wards to government health facilities for the administration of the vaccine. Adesanya explained that the FIPV would be administered on children aged 14 weeks-59 months while the OPV drops would be for children aged 0-59 months, pointing out that the vaccines were beneficial, safe and potent to boost the immunity of children against the crippling virus. Also speaking, Elijah Ogunsola the executive secretary of the board, advised mothers, caregivers as well as Community and religious leaders to cooperate with the State government towards eradicating polio and to justify the huge investment made in collaboration with development partners in the health sector, as the vaccine would also be made available for children in the border areas. Sunday Abidoye, the state Coordinator, World Health Organizawww.businessday.ng

tion (WHO), while commending the state Government’s efforts at ensuring that the exercise was carried out according to the stipulated timeline, emphasised the need for public enlightenment to reinforce the usual house to house visitation by health workers due to the FIPV special vaccine to be administered. In their separate remarks, the Acting Head of Local Government Administration (HOLGA), Imeko Afon Local Government, Oluwole Oladipupo and a community leader, Chief Fola Olaleye, while commending the State government for placing special attention on children in the border communities, admonished parents and caregivers to take advantage of the exercise. Moriamo Wahab and Kemi Adeoti on behalf of mothers and caregivers thanked the State Government for making the health of children in the state a priority, promising to inform others to make their children and wards available for routine immunisation at all time.

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he new cutting-edge cancer treatment machine just installed at the National Hospital Abuja will reduce patient’s treatment waiting time from 16 minutes to two minutes, Jaf Momoh, the chief medical director of the Hospital, said on Friday 2nd of August, at the inauguration of the equipment by the Vice President, Professor Yemi Osinbajo. The Elekta Synergy Linear Accelerator radiotherapy machine donated by the Nigeria National Petroleum Corporation (NNPC) and Shell Nigeria Exploration and Production Company (SNEPCo) enables treatment to focus on the cancer tumour and not impact other organs in the patient. Momoh described the intervention by NNPC and SNEPCo as timely noting that first cancer treatment equipment in the hospital became disused in 2017 after 17 years of use which caused the hospital management to set out for two state-of-theart replacement machines. According to him, the first replacement machine was installed and inaugurated in December 2017 and has since “treated 850 patients in over 25,000 cycles of radiotherapy sessions”. “With this new machine, the hospital is poised for effective and efficient cancer treatment with no interruption during periods of routine equipment maintenance,” Momoh said, adding that indigent patients would enjoy subsidised treatment. In his speech, Vice President Osinbajo said cancer prevention initiatives should be promoted, noting that many cases of the disease could be prevented. Represented by the Permanent @Businessdayng

Secretary, Federal Ministry of Health, Alhaji Abdullahi Mashi, Osinbajo said “The increasing trend in the prevalence of cancer may be a reflection of lifestyles which goes to show that lifestyle modifications may go a long way in curtailing the scourge. This underscores the importance of awareness creation at all health facilities and provision of screening facilities.” The Vice President charged wellmeaning Nigerians and organisations “to replicate what NNPC and Shell Nigeria have done in other health facilities to make cancer treatment easily accessible to patients.” SNEPCo’s Managing Director, Bayo Ojulari, said the intervention by NNPC and SNEPCo was to support government to widen treatment access, reduce waiting time significantly, and provide world-class facility that boasts of precision. “The Elekta Synergy LINAC offers a unique radiation therapy technique that accurately shapes the radiation dose to the tumour with very little or no adverse effect on the surrounding organs, he said. According to him, the cancer support was one of the five critical health projects being executed across the country by NNPC, SNEPCo and their co-venture partners. He listed other projects to include Medical Emergency Response Improvement Programme in Lagos; Health System Strengthening Project at the Primary Healthcare Centre in Ogijo, Ogun State; Community Care Programmes – Health in Motion – across Nigeria; and Integrated Humanitarian Assistance Project for internally displaced persons in Dikwa, Bornu State where over 50,000 persons have so far enjoyed a broad range medical services, with over 826 children delivered.

Friday 09 August 2019

BUSINESS DAY

HEALTH BUSINESS&LIFE Hajj August 2019: Travel tips for total health package

Dr Ade Alakija Q-life Family Clinic Continued from last week

uring your trip: Be aware of your surroundings. Hajj is one of the largest mass gatherings in the world. Know that your risk of accidental injury increases in large crowds. Locate the exit routes and medical facilities. Protect yourself against food or waterborne infections by eating and drinking safely during Hajj. Protect yourself from Middle East Respiratory Syndrome Corona virus (MERS-CoV) while you are travelling. Avoid close contact with animals, particularly camels. Camels have been found to carry and transmit MERS-CoV to humans through contact with and consumption of meat and body fluids. If you must visit a farm or market, make sure you practice good hygiene and wash

your hands before and after contact with animals. Protect yourself and others from the spread of germs and flu-like illnesses. Wash frequently with soap and water. It’s a good idea to always keep some alcohol-based hand sanitizer with you if soap and water are not available. Avoid touching your eyes, nose and mouth with your hands. Try to avoid contact with people who appear to be sick. Use only new razors for shaving. Choose a barber who uses disposable, single-use blades. Follow sun and heat safety tips. Heatrelated illnesses and dehydration are common during the Hajj. Hajj pilgrims should stay well hydrated, wear sunscreen, and seek shade when possible. Some rituals may also be performed at night to avoid daytime heat. Drive with caution. The leading cause of death among international travelers is traffic accidents. Follow road safety rules to avoid injuries. Take extra care when crossing roads and always wear a seatbelt when travelling in motor vehicles. For more information on road travel in Saudi Arabia, visit the Safety & Security section of the Arabia. Protect at all times, drink water and beverages that are sealed or known to have been purified and eat food that is served piping hot or fruit that you have peeled yourself. For shaving, be aware that unclean razors can transmit viruses such as

hepatitis B, hepatitis C, and HIV. Travelers should be shaved using disposable blades at officially designated centres, or use their own disposable blades and avoid sharing personal hygiene tools. Try to avoid the most densely crowded areas during Hajj and, when options exist, perform rituals at non-peak hours. What if I get sick? If you get sick while overseas or on your return, seek prompt medical attention. If you become unwell on your return to Nigeria be sure to advise your doctor of your recent travel to the Middle East. Be aware of how to manage travelers’ diarrhoea, including drinking plenty of fluids made up with oral rehydration salts (ORS) to avoid dehydration. Be aware of the early symptoms of meningococcal disease which may include fever, headache, nausea and vomiting, weakness, neck stiffness and a rash. If you develop these symptoms you need to seek medical attention immediately. If you develop flu-like symptoms during the pilgrimage (fever, cough or shortness of breath) or other symptoms, such as vomiting or diarrhea, report your symptoms to the medical staff accompanying your group or to the local health services. If you notice these symptoms during the flight, tell the flight attendant before you land or the border services officer as you enter the country. They will notify a quarantine officer who

can assess your symptoms. Make sure you review the advice published each year on the Saudi Arabian Ministry of Health website which includes advice on the health requirements for receiving entry to Saudi Arabia for the Hajj. Vaccinations: All travelers should be up to date with their routine vaccinations including those against measles, mumps and rubella (MMR), diphtheria, tetanus and pertussis (dTpa) and polio. For travelers who do not have evidence of measles immunity or who lack written documentation of measles vaccination, the CDC recommends 2 doses of MMR vaccine separated by at least 28 days, to be completed before travel. Following outbreaks of meningococcal disease in past years, there is a requirement for all Hajj pilgrims to show proof of meningococcal vaccination before Hajj visas can be issued. Hajj pilgrims must have had a quadrivalent (A/C/Y/W135) meningococcal vaccination within the previous 3 years (for polysaccharide vaccines) or previous 8 years (for conjugate vaccines) and at least 10 days before arriving in Saudi Arabia. Travelers from countries or areas at risk of Yellow Fever (including Nigeria) must also carry a valid Yellow Fever vaccination certificate. Seasonal is also recommended for pilgrims. You should also discuss with your GP or travel clinic the need for additional vaccines such as those against pneumococcal pneumonia,

hepatitis A, hepatitis B and typhoid. Poliomyelitis: Travelers arriving from countries with circulating wild or vaccine-derived poliovirus (cVDPV2) and from countries at risk of polio reintroduction are required to submit a valid polio vaccination certificate. Vaccinations should be completed at least 2 weeks prior to departure. Additional CDC Hajj travel insights: Tuberculosis: The crowded conditions during Hajj increase the probability of tuberculosis transmission. Risk is estimated to be about 10% in those with high level of exposure. Many pilgrims come from highly endemic areas and some arrive for Hajj with active pulmonary disease. Diarrheal disease: A pre-travel visit should include discussions about prevention, oral rehydration strategies, antimotility agents, and emergency antibiotic use for treatment of travelers’ diarrhea. Nasal ablution: Often called ‘istinshaaq’, is the practice of rinsing your nose with water before performing some rituals during the Hajj. Medical literature has identified cases of primary amebic meningoencephalitis (PAM) caused by Naegleria fowleri transmitted as a result of nasal ablution. Nasal ablution is common during Hajj, and pilgrims are advised to use safe water to protect themselves from this potential risk.

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Prime Atlantic trains LASWA members on First Aid, Cardiopulmonary resuscitation DIPO OLADEHINDE

N Tuberculosis: Researcher develops anti-TB drugs, vows to tackle the menace SIKIRAT SHEHU, Ilorin

isituraLawal-Arowona, Nigerian scholar, who is pursuing her research at MSU under fellowship sanctioned by the Italy-headquartered Third World Academy of Sciences and Department of Biotechnology, Government of India, has developed metal attached anti-TB drug. This has improved the efficiency of the anti-TB drugs compared to normal drugs that are consumed globally. The PhD scholar with the University of Ilorin, who made this known in a statement released to Nigeria however, promised to tackle the menace of tuberculosis (TB), both in African countries as well as India. Nigeria, according to her is among the 14 high burden countries for TB, TB/HIV and multi-drug resistant TB. She says “The country is ranked seventh among the 30 high TB burden countries and second in Africa. The problem of TB in Nigeria has been made worse by the issues of drug resistant TB and the HIV/AIDS epidemic. It is estimated that 4, 07,000 people in Nigeria have TB in a year.

HBL TEAM

“Earlier studies have proved that when a metal is attached with a pharmaceutical, it increases efficacy of the drug,” Adding that, taking a cue from cisplatin, an anti-cancer drug, whose efficacy improved after applying platinum as metal, the scholar worked on multiple metal-based drugs to see whether efficiency of anti-TB drugs can be increased by attaching metals to it. According to her, she used metals like ion, cobalt, copper and zinc to prepare the metallodrugs. The drugs, which have been developed, include ciprofloxacin HCl, ofloxacin, pyrazinamide and moxifloxacin HCl. Presently, there is no metal-based anti-TB drug available in the market. Meanwhile, Rajendrasinh Jadeja from MSU’s chemistry department, who is mentoring the Nigerian scholar, says “When we compared the metallodrugs with the original anti-TB drugs, the metallodrugs were more effective. “We did in vitro test against bacteria. The metals we have chosen are non-harmful to human beings. Also, we found that of all the metallodrugs, the copper complex of ciprofloxacin is most effective.”

igeria based Oil servicing firm Prime Atlantic, a subsidiary of Prime Atlantic Limited has organized a capacity building training for staffs of Lagos State Waterways Authority (LASWA) in basic First Aid and Cardiopulmonary Resuscitation (CPR). CPR is a life-saving technique that is useful in many emergencies including a heart attack or near drowning during which someone’s breathing or heart has stopped. While many countries of the world have incorporated the teaching of cardiopulmonary resuscitation (CPR) into their schools curricula, there has been little or no effort made towards this in Nigeria, which is why Falck Prime Atlantic is trying to fill the knowledge gap by offering professional trainings

services. Falck Prime Atlantic said it was evident that most Nigerians lacked the necessary skills required to respond to medical emergencies, adding that it had resulted in many preventable deaths. Aderonke Adebanjo, the Marketing and Communications Manager at Falck Prime Atlantic, said the company had set out to change the narrative, adding that many Nigerians would be equipped with live-saving skills to save lives at any time. She said the company would train individuals from different walks of life, including market traders, commercial drivers, students, celebrities, youth corps members, and government officials for free. “This will ensure that across the city of Lagos, a variety of individuals are able to potentially save lives when faced with medical emergencies,”

Adebanjo added. “This is a training that is very expensive and cost a lot of money to do. This year we have a target of training 400 Nigerians which we might exceed before the end of year.” Oluwadamilola Emmanuel, the general manager at LASWA said the training by organized by Falck Prime Atlantic is a welcome initiative while also encouraging more private organizations to do collaborative trainings with public sector which will enable its members build a safety culture within our environment. “As a regulator over the waters ways, trainings like this will help us respond quicker and faster in times of emergency,” Emmanuel said at the event. Recall last month, Falck Prime Atlantic organised a capacity building training for firefighters in Nigeria on its facilities in Ogun state.

Oyo partners Rotary to combat Polio REMI FEYISIPO, Ibadan

yo State government is to partner Rotary International in the struggle to eliminate Polio in the State. The Executive Secretary, Oyo State Primary Health Care Board, Lanre Abass, a medical doctor stated this while receiving 20,000 aprons specially designed for identification of State Polio Vaccinators, donated by Rotary International at Ibadan. While commending Rotary, Abass the aprons would serve as source of easy identification for the State Vaccinators while on the field, thereby eliminating the fear of the people on the genuineness of the

individual vaccinators. He disclosed that the State had 2300 vaccinators across the State; a large reach which he said he helped made the State Polio-free. “The aprons will serve as source of easy identification for State Vaccinators while on the field, thereby eliminating the fear of the people on the genuineness of the individual vaccinators as the State had 2300 vaccinators across the State, a large reach which he said he helped made the State Polio-free.” Abayomi Adewumi, the Vice Chairman, Southwest Zone Nigerian National Polio Plus Committee of Rotary International, said the donation was in line with the agenda of Rotary International to eradicate

ANTHONIA OBOKOH / Reporters. Email: obokoh.anthonia@businessdayonline.com

polio globally. Adewumi called on government at all levels and relevant stakeholders to step up sensitization of parents on the need to have their wards vaccinated in order to have a Nigeria that would be polio-free. Meanwhile, fifty youths from Oyo State were beneficiaries of Governor’s Seyi Makinde’s efforts to fight poverty in the State as the State, on Wednesday distributed 50 tricycles to empower the beneficiaries. The event which held at the premises of the State Ministry of Women Affairs and Social Development, Ibadan witnessed a large turnout of beneficiaries of the distribution of the tricycles that was said to be the first batch.

I David Ogar, Graphics

Friday 09 August 2019

BUSINESS DAY

LEADINGWOMAN

For SAUDAT SALAMI, digital commerce is the new frontier KEMI AJUMOBI

audat O. Salami is the founder/C.E. O of www. easyshopeasycook.com, the foremost multi-platform fresh grocery delivery company in Nigeria that uses technology to provide domestic support services to working professionals. Her platform partners with various corporations with large workforce that understand their role in helping employees achieve work/ life balance using a combination of support services which fit into HR policies. This helps to enhance productivity, reduce staff turnover especially the women workforce, improve efficiency and very importantly creates a conducive and inclusive workplace. She is an African Women Entrepreneurship Corporative Alumna, United States IVLP Alumna, Vital Voices Grow Fellow, Goldman Sachs 10,000 Women scholarship recipient; Alumna of CEM (Certificate for Entrepreneurial Management) program at EDC an arm of Pan-African University, Lagos and an Alumna of Fate FoundationAspiring Entrepreneurs Program. She is an Associate Member of WIMBIZ (Women in Management, Business and Public Service), WEConnect international, Nigerian Association Of Small And Medium Enterprises, Institute of Logistics Management of Nigeria and volunteer to various charity organisations. In the beginning Growing up was difficult for me, I remember being a moody child and my friends used to think I was a snob not knowing that I did not really know how to mix and keep friends. I did not have any plan for my life, no one told me I had to have one, so I was opened to anything till my early twenties. I was then introduced to books, Islamic religious books, motivational books, leadership books, Christian religious books and autobiographies by my early mentors. I have read the English Quran cover to cover countless times and the understanding of God’s words and promises allowed me a certain peace and assurance I didn’t get from anywhere. It took a while to get it but eventually I gained an awareness that changed how I saw myself and my purpose as a woman with big dreams and goals for a more fulfilled and deliberate life. When and why did you decide to go into your line of business? The idea came about in 2001 during a conversation with a close friend of mine, Tomi Pearce the founder of Aweni Organics, about challenges women face in balancing work and home life. We listed some of the domestic chores that career women do and looked at ways we could create businesses around those chores for the women so that they can focus on their career without hindrances like the men have done successfully over time. I have a tech background and was working as a website developer

and software application trainer at the time; I realized I could build a website to help career woman shop for fresh groceries and this will solve some of their work-life challenges. From 2001 to 2005, I ran a pilot of the business part time, running feasibility studies about its viability and also learning more about the problem the business was to solve, the target customer, the industry and so on. I also joined the Success Digest club of Dr. Sunny ObazuOjeagbase, which prepared me for the challenges of running a business in Nigeria. In 2005, when I had proof of concept, I resigned from my job and started the business at home full time. Starting off As a pioneer in this business and sector, starting was very difficult. My website was live but internet connection was slow and wasn’t readily available to everyone. There was no trust for a remote person to buy groceries for you and deliver to your home. Even though women desperately wanted to outsource their shopping for convenience and time savings, the culture stigma was very high. Outsourcing such chores publicly was frowned- upon as they were termed lazy and inadequate by other women and men. People felt using a support service like Easyshop Easycook meant the women valued their work more than their www.businessday.ng

home which was not the case here but that was the narrative in the media and social space and this made customer acquisition very difficult. In order to get customers, I had to do it the traditional way, go door to door from companies to homes. My sister is an old girl of Queens College, Lagos, she gave me a good number of her friends working in Lagos and because of the relationship, they trusted me and soon referred friends and family. There were no organised online community to reach customers at the time like we have today. It became easier when I joined Wimbiz and was introduced to early founders and members particularly Osayi Alile, Bola Adesola, Yewande Zacchaeus, Nimi Akinkugbe and Ini Abimbola. WIMBIZ is an association of career women and business owners and these are my main demographic. They believed in me and helped spread the service faster amongst their friends, family and businesses. They also demanded a lot of professionalism from the business and this helped us to standardize early and grow sustainably. What differentiates us from others is our driving force, our clear understanding of the problem we are solving, who are target customers are and the added value we bring to our customers. Another thing I did was get mentors early who later became shareholders and directors

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of Easyshop Easycook. They did not understand the e-commerce space at the time but they understood how to run a business successfully, their guidance, support and patience, a lot of patience helped us stay the course. In comparison with when you started, where would you say your business is at today? This is a sector where most players die or pivot before they are 3 years old. I believe we are still a work in progress but we are making good progress. The online grocery delivery sector in Nigeria requires a lot of infrastructure and culture change in other to be profitable for all players. Our survival is partly linked to the value chains of the agric sector and our problems are far greater than building fancy websites, mobile apps or payment gateways. Other developed countries we copy do not have the challenges we have here. Our realities are not theirs and if we run our businesses the way they do theirs we will have serious problems which is what has been happening to the sector for years. For me, collaboration is where we should be looking at in this sector instead of competition. We need to come together to define the problems and work with other stakeholders to put in needed infrastructure for all our benefit. @Businessdayng

Latest initiative you are championing for women We started a women empowerment initiative to train 50 women every quarter, starting from this August on how to start and run successful personal home shopping businesses. Women make enormous contributions to economies by doing unpaid care work at home, setting up informal small businesses mostly food related and helping out on farms. This initiative helps to formalize the home business through entrepreneurial trainings that will be used to scale-up and build bigger businesses. Nigeria has the highest number of female entrepreneurs in the world but what is the size of our business compared to other parts of the world? It is very small because we are not empowered to scale-up. Our program will give the women access to start-up loans, linkages to farmers cooperatives, FMCGs, business tools and oneyear mentorship with me. I will be sharing my knowledge and experience with the women so that we can come together to build an ecosystem that will grow to change the online food sector. This is also a woman supporting woman initiative. The women we will be training will be building businesses that will serve as support services for career women. Women make over 70% of domestic decisions and when we encourage a woman to pursue a career and leave the home, combining these roles becomes a huge burden. We have to understand that without a support service, a gap will be left at home and many women tend to pull out of their jobs or avoid promotion opportunity especially when they become mothers or get married. We are empowering women to empower women. It is huge for us as this is the mindset that kept us in business for this long. Understanding our role in the grand scheme of things, the problem we are here to solve and the impact our work is having in the society. Advice to young entrepreneurs Consistency and patience makes a lot of difference in all you do to grow your business. Collaboration will take you very far and you must be willing to learn from others. Awards might be a form of validation but trust me, you don’t need them to succeed. Validate yourself and get on with your work, your success will validate you in time. Final words Women must stop telling themselves that they are lazy or inadequate for requiring help whether at home or in the office. If we want to move up the pyramid of life and occupy top positions, we have to learn to change the words we use on ourselves and this will in turn empower us to change our mind-set. Delegation is part of leadership; we must get used to it and do not feel bad about doing it. Read the concluding story of Saudat’s inspiring story on our website www.businessday.ng as she graces our Women’s Hub cover for this week. You are just a click away!

Friday 09 August 2019

BUSINESS DAY

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Friday 09 August 2019

BUSINESS DAY

ENTERTAINMENT

‘Silverbird Cinemas is doing well in Ghana with good box office grossing’ Since establishing in Ghana a decade ago, Silverbird Cinemas has raised the bar in quality entertainment offerings with two cinemas and five screens each in Ghana. In this interview at the cinema outlet in Accra Mall, Olufunmilayo Onuma, country manager, Silverbird Cinemas Ghana, with 10 years experience across cinemas in Lagos, Port Harcourt, Uyo and now Accra, explains to OBINNA EMELIKE the dynamics of the business, the reasons for the feats, expansion strategy, challenges, among related issues. Excerpt.

o w i s Si l v e rb i rd Cinemas doing in Ghana? Silverbird Cinema is doing very well in Ghana. We have been here for the past 10 years and will be celebrating our 11 years in Ghana by November this year. We have done very well in offering the best of entertainment and quality timeout for people in Ghana, especially families. For instance, when Black Panther came out, we were No.1 for week and had the highest gross at Box Office in West Africa, we were No.2 in Africa, and No.1 again in West Africa this year for Avengers movie. For Black Panther, we had over 16,000 people in the first four days. The figures are verifiable and were given to us by the movie distributors. All the feats are because of the conducive atmosphere in Ghana, the easy-going lifestyle of the people, and most importantly, the fact that they cherish the time they spend with their families. Weekends, particularly Sundays are family days where a lot of families come to watch movies together unlike in Nigeria were families go out more on public holidays. We have a lot of expatriates in Ghana, ambassadors come with their families and we have never heard of any security threat for the past 10 years. The good performance of Silverbird Cinema in Ghana is in spite of other cinemas. We have two cinemas in Ghana and there are other cinemas that have come after us, but we standout because we offer trendy and worldclass movies, good customer service, amid addressing issues when they arise. Again, our founders are people that whenever any issue concerning their business comes up, they address them. Ben Bruce, our co-founder, and Edward Boateng, our chairman and co-founder in Ghana, who is now the ambassador to China, are friends who came together to start the cinema business in Ghana. The business has been good despite normal issues, which the Ministry of Culture and Tourism has been very helpful in tackling like piracy and some TV stations showing some of our movies and we wrote them and they acknowledged it and we had meetings with them. The ministry wrote the TV stations and addressed the issues immediately. They did not say we are a Nigerian company. We have over 72 staff members and only two Nigerians are working in here (a business manager and myself ). So far, what factors do you think contributed to your success in Ghana? Ghana is peculiar. If you look at the position of Accra Mall, you have 11 roads leading to the mall and the airport is just behind, we have the

get it because some of these things require lots of licensing, review of your facilities among others by the regulators. Ghana has been good to Silverbird and we have also been good to the people and the economy too.

expatriates, we have the schools and there are more universities in Accra than in Lagos. The demography is a boost to our business here. Most of my customers are between the ages of 13-35 years old. So, when you have more than 11 universities in Accra that is a lot of numbers for the business. Prior to my arrival here, we were using the old projector, the 35mm; now we have fully digitalized here and with that we were able to get new movie releases. So, when students are in session and the new movie releases come out, it is good for us. Like Black Panther, they had a lot of Kente in it and Ghanaians pride themselves with Kente anywhere they go. I knew about Kente because of Jerry Rawlings’ wife. When I was younger, I used to watch her on TV. Now I am in Ghana, I have seen designs for royalty and all that made from Kente. So, it is a source of pride when you see it on an international movie that was not meant to succeed with the budget and the wrong timing of the movie because blockbusters usually come out in summer and not in February when Black Panther was released. The Republic of Togo is nearby and we do not have cinema there, so a lot of people came from Togo, Cape Coast, from different places and even some traditional chiefs came with lots of drums to see the Black Panther. So, it was overwhelming, people came in groups to see it because it touched different parts of their lives and cultures. Of course, Ghanaians cherish family time and were not running after money all the time. Many families came to see the Black Panther movie. Again, the Ghanaian style of seeing movies is different, it is new to them and when a new movie comes out, they want to be the www.businessday.ng

first to see it and to assert to other people in the western world that we too have seen it. Cinema culture was once vibrant in Nigeria, now trying to rebound, but it is just beginning in Ghana and they do it well. While we rush, come back and start again, Ghanaians take their time to do things. So, before even coming to see the movie, they must have followed the trend online on social media and searched for it on Google. Like Avengers, the move was done 10 years ago and a lot of young people watched it and you know that they are more active on social media nowadays than the 35 and 60s. The intrigue of the Avengers was that a lot of people, who grew up reading comics came to see the movie and it was a three-hour film and certain super hero died that will not come out may be in our lifetime. Young people want things now and when they see it, they go online talking about it, as someone in Asia or America is talking about it, they too want to be current. The future is now for the younger generation and not tomorrow. How many cinemas do you have in Ghana? We have two with five screens each. The first is here at Accra Mall while the other cinema is at West Hills Mall at Weija. We look to expansion but that is the founders’ decision to make. But next year is an election year and it would not be a wise business decision to go into any huge project. Again, technology is changing; we have 4DX, and IMAX. So, we plan to upgrade what we have to international standard because these young people want something that is current. In Silverbird in Nigeria we have 4DX, in Filmhouse they have IMAX, and so a lot of Ghanaians want that same experience, so we are working to

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Are the local films seen more than the foreign ones? Funny enough, they have good producers in Ghana. But the only problem is that nobody supports the film industry in Ghana the way Bank of Industry has done in Nigeria. They do not have access to funding, but when they do, they come out with good numbers. We have had one or two producers like that, we had Keteke last year, and Lydia Forson, one of the cast members, won award at the AMVCA. The producers are good, but government needs to support them because Ghana has lots of historic stories to tell the world such as the Kwame Nkrumah story, which needs to be made. But the patronage of local versus foreign content in our cinemas in Ghana is 50:50. We also have Nigerian, Indian and other movies here, but Ghanaians support their own a lot. As well, there is a lot of Nigerian university undergraduates here in Legon, Kumasi among other cities in Ghana, that see Nigerian movies too. Beyond bottles of soft drinks and packs of pop corn, what others perk do you offer customers? We have partnerships with hotels, and other companies where we have lucky dips and give out phones, among other gift items to ensure there is no dull moment for our customers because some people might just wait for the movie to get to Netflix and download it. So, we do giveaways and packages where we get people to sponsor tickets to shows, and we also give out free tickets to music and comedy shows and concerts. There is a giveaway to our customers every month. Our major targets for the giveaways are the young people because when they are on holidays, they do not usually get allowances, so they need all the freebies to keep positively busy with friends at the cinema. A lot of companies in Ghana have been very supportive in the giveaway packages, especially MTN and Glo. What impact is cinema making in the tourism landscape of Accra? If you are new in town, there is a handout they give visitors at the airport, our cinema is there. Silverbird is among the top 10 places to visit in Accra because Accra Mall, the host of the cinema, is a landmark. Pricing has always been an issue for many would-be cinema goers, how affordable is your @Businessdayng

ticket? Though ticket prices vary, we carter to all class of customers. We have packages where you can watch a movie for GHC 25 with popcorn and drinks on a certain day and about GHC40 on a different day. We have movies that go for GHC 40 but there are different titles based on different agreements I have with different studios. Some studios insist that you do not give discounts in the first two weeks and I will sign and after two weeks we start giving discounts. Discounts are also based on the movie, but you will always get a discount on Mondays. We have children price, which is cheaper than adult, and also ‘buy one, get one free’ on Thursdays, which is sponsored by some of our clients. We do that with banks too; Ecobank and GTBank have been very supportive. The ticket sponsorship helps them to get statistics for their data base and makes their customers to feel well-appreciated. So, in Silverbird Ghana, it is standard to buy discounted tickets at GHC 25 on Mondays and ‘buy one, get one free’ on Thursdays. Across others days, there are promotions depending on the movie you want to watch. How do you source your movies? We have different distribution companies and Silverbird also has its own distribution company in Nigeria called Silverbird Film Distribution (SFD), we have FilmOne Distribution, Blue Pictures, Crimson, among others that have rights to different studios. Silverbird has right to Universal Studios, FilmOne has Warner Brothers, and Crimson has Disney. So, it depends on the movie they are going to get. Then we have the local distributors in Nigeria that distribute movies such as The Wedding Party among others. The intrigue of the cinema business is that even in 2022, we know the movies that are coming out. There is CPRS, which distributors send around to know the movies that are coming out, when, where they are shooting it, the characters and other details. What are the challenges of running cinema business in Ghana? Well, the initial challenges were currency issues, technology not meeting international standard, staffing and training them to render service to different kinds of people from different cultures. For instance, the India community here is very large, and you have the Arabs, among other African cultures. I never knew that Coca Cola is made in different countries and people ask specifically the country the Coca Cola you are serving is made or imported from. Some customers are sensitive to some of these details and you have to serve them because you are dealing with multicultural clientele.

Friday 09 August 2019

BUSINESS DAY

ENTERTAINMENT What’s on The Agenda? BUSINESS ETIQUETTE

JANET ADETU

ow many times have you been in a meeting where you are simply unsure of what to expect? This is possibly a situation where the meeting you are in has no particular agenda, the flow of the meeting is entirely up to the person presiding. The implication of having no agenda during meetings can derail that meeting, rear off scope, as well as infuse other things not really expected to be spoken about, completely dragging the meeting to last for unusual hours. An agenda speaks to all the topical issues that needs to be discussed to enable the meeting to be productive. The agenda also allows for a structured allocation of time for those that will be expected to report or deliberate on a specific topic or area of concern that may also require voting on. That agenda will guide all the attendees to concentrate on the issues as they arise, air their views and opinions and finalise on a decision. It is true that in some meetings where the agenda is made available that some items are still over dragged leading to over time being spent on a meeting proposed for just an hour. Once the need to hold that meeting has been established the leader must ensure that it is effective, productive and meaningful. I will talk about having successful meetings on another column but today my focus is on “what’s on the agenda” Let’s look at the flow of an agenda for better clarity. Why this Meeting? The process of building an agenda starts with establishing the main rea-

son for the meeting. It is a known fact that many meetings are time wasters and may not need the physical presence of its participants. This happens when there is need for multiple decision makers for certain goals to be achieved. At times a simple email will surface avoiding having that meeting and the stress that comes with meetings. Who For? It is not about the number of people in a meeting that matters, it is the agenda that should be specific to a group of people. In communicating the agenda, let it be known who the meeting if for so that the right people attend. If it is a corporate meeting it is important to stipulate the category of staff required in attendance. Very large meetings are a potential for disaster and disorder. It maybe that only key decision makers are required who will discuss on behalf of the larger body. Executive Committee Members usually have regular weekly, monthly or quarterly meetings, the agenda typically is predictable with a structured flow of events. What to Discuss A meeting of essence will have many areas of discussion that will need to be reviewed, reverted and deliberated upon incorporating the main goal and objective of the meeting all together. Try to keep the discussion structured and meaningful with the aim of achieving results in a successful meeting. It is important to ensure that topics do not become domineering creating confusion and disorder. To be sure that you have captured everything to be discussed you may decide to ask to adopt the agenda giving room for any addition in case something had erroneously been left out. Once everyone agrees with the items listed the meeting procedure can take place. Topic Arrangement When several topics are expected to be discussed in a meeting, the agenda order is key. It is not a case of saving the best for last. The most important topics must be placed first as a priority. Other topics will follow suit in order of impor-

tance. Where individual heads or key position holders are present you may decide whose report is of significance to kick start discussions. Usually all discussions will commence with the Chair or Vice Chair leading into the main pipeline of topical issues. It is the secretary that will draw up the line - up of topics and present to the leader for approval before circulation. Any Other Business There are times when attendees of meetings may have something to raise during a meeting which is considered outside the scope of the planned topics but is also important or relevant at the time. In such cases there should be an item on the agenda known as AOB meaning any other business providing that opportunity to raise a discussion outside the main agenda. It is important to note that if care is not taken this has the potential to let meetings linger on. It is also possible that such topics can be postponed for discussion in the next upcoming meeting.

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Once the need to hold that meeting has been established the leader must ensure that it is effective, productive and meaningful

Set Timings This is a crucial element to an agenda. It is not necessary to indicate the timings on the agenda when circulating the agenda, but for the purpose of smooth and effective execution this can be at the discretion of the Chair. Equal time slots is advised where individual members are to present reports. At this point time allocated to AOB should be adhered to avoid creating a new meeting.

details of the meeting, when, where, what time as well as why the meeting is holding. Having a pre-hand view of the agenda will allow participants to prepare ahead where necessary. If reports are required to be shared then you have been given that heads up reminder probably previously agreed in an earlier meeting. It is the duty of the secretary of the meeting to ensure all attendees receive the agenda of any meeting ahead of time. Physical Vs Virtual A physical meeting is traditionally the ideal meeting, which is face to face physical, however today with the use of technology virtual meetings are now widely acceptable. Members have the option of joining meetings through video conferencing. The choices are now numerous they include. Zoom, Free Conferencing Call, Skype, or more recently though for limited users the WhatsApp call. Connectivity may be a challenge where there is a fluctuation in the internet connection. Overall this option is considered more convenient where distance is involved, or time is a problem. A link to the virtual platform must be provided in advance with an access code where necessary. Attendees can equally contribute in the same effective way as those present. The Chair must provide the opportunity. The AGENDA i. Meeting Title ii. Where / When iii. Address iv. Opening Prayer v. Introduction vi. Adopt Agenda vii. Read Minutes viii. Matters Arising ix. Business of the Day x. AOB xi. Next Meeting xii. Adjournment

Who Chairs? The agenda is typically run by the Chairperson of the meeting to ensure the smooth flow of events. The Chair is the leader of the team with the responsibility of using the agenda correctly. The meeting kicks off once the Chair is satisfied that the right people are in attendance. A deputy or vice can also chair a meeting but only in the absence of the leader of the pack.

Please share your experience with me by sending an email to or janet.adetu@jsketiquetteconsortium.com. / jtadetu@gmail.com Follow and like @janetadetu @jsketiquetteconsortium I look forward to hearing from you.

Circulation It is always important that members of a group who have been invited to a meeting receive the agenda ahead of time. This will inform all attendees of

8157 entries set new submission record in 6TH AFRIMA …Adjudication begins, nominees’ list unveils on August 14 OBINNA EMELIKE

he 6th edition of All Africa Music Awards, (AFRIMA), in partnership with the African Union Commission, has received 8,157 songs and videos on its online portal as entry submission closed on Friday, August 2, 2019. This year’s submission recorded the highest number of entries from African artistes, music producers, songwriters, Disc Jockeys (DJs), and video directors among others, since the inception of the biggest music event in Africa. The 2019 submissions, which opened worldwide on May 15, 2019, exceeded the 2018 submissions by 148 entries. Of the 8,157 entries submitted this year, West Africa leads the pack with 38 percent of the total entries followed by Southern Africa with 24 percent. East Africa, Central Africa and North Africa have 20, 14 and 4 percent respectively. Meanwhile, following the end of the 6th AFRIMA entry submission, a 13-man International Jury of AFRIMA arrived Lagos on August 7, 2019 for the week-long adjudication process from August 7 to13. The AFRIMA Jury’s responsibility involves screening, categorising, assessing, grading and selecting into the

36 different regional and continental awarding categories, the nominees who will vie for the 23.9 carat gold-plated AFRIMA trophy. AFRIMA hospitality partner, Eko Hotels & Suites, Victoria Island, Lagos, will be providing venue for the jury members who represent the five regions of Africa, the Diaspora (Europe and North America) and the African Union Commission. Guided by transparency and fairness, each of the jury members will bring their span of experience and professionalism to play and utilize their boundless knowledge of African music, culture, and entertainment, to collectively arrive at artistes and/ or recordings on the 6th AFRIMA Nominees’ List that reflect the creative energy and output of African music talents between the music review period of August 1, 2018 to August 2, 2019. After this process is concluded, the 6th AFRIMA Nominees’ List would be unveiled during a World Media Conference scheduled for August 14 at the Eko Hotels & Suites, Victoria Island, Lagos. The AFRIMA jury members from East Africa are; Tanzania’s Joett, vocal coach and artiste development manager and Tabu Osusa from Kenya.

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Representing Central Africa are; Charles Tabu, a music executive with wide experience in artiste management and promotion from Democratic Republic of Congo and Bob Ekukole, Cameroonian media and music professional. Northern Africa is represented by Omar Essaidi, a Moroccan music programmer and artistic director. Southern Africa is represented by Delani Makhalima, Zimbabwean radio DJ and lawyer, and Chris Syren, South Africa’s music professional, concert promoter, and co-founder/director of Making Music Productions (MMP). Western Africa is representative by Olisa Adibua, prolific broadcaster, music executive and talent manager from Nigeria and David Tayorault, a Côte d’Ivoire music legend. Representing the Diaspora-Europe is Rita Ray, a UK-based BBC Radio 3 presenter, international music curator and popular Club DeeJay, while Hadja Kobélé Keita, music executive with Universal Music Africa/Island Africa, represents Diaspora-North America. The African Union Commission is represented by Angela Martins, head, Culture Division of the AUC. Martins, a Mozambican, is a professional African Culture Analyst and an

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African music enthusiast. Speaking on the 2019 entry submission and adjudication process, Martins said: “AFRIMA, the Pan-African initiative and music platform is gaining greater momentum, continental visibility and recognition. This can be verified by the increased number of entries received for its 6th Edition, to be held in November 2019. “The African Union Commission congratulates the international Committee of AFRIMA for this achievement and the promotion of the continent’s creative economy. The Commission would like to express its strong support to AFRIMA as it plays a key role in recognising and awarding myriad of music talents on the continent. “In the same vein the AU Commission welcomes members of the AFRIMA jury who will start the important adjudication process on August 7th in Lagos, Nigeria. The role of the AFRIMA Jury is crucial to ensure fairness and transparency of the continental awards”. Also reacting to the entries received for the 6th AFRIMA, Charles Tabu, expressed excitement that more artistes within and outside Africa we getting involved in AFRIMA submissions.

@Businessdayng

Friday 09 August 2019

BUSINESS DAY

Feature REA lights up Federal University in Ebonyi with off-grid solution The Federal Government recently fulfilled a promise to power Nigerian Universities by commissioning the first solar hybrid power plant at Alex Ekwueme Federal University Ndufu-Alike Ikwo (FUNAI) in Ebonyi State. STEPHEN ONYEKWELU suggests that the emerging renewable off-grid energy sector driven by the Federal Rural Electrification Agency (REA) seeks to generate value for Nigerian open-air markets, un-served and underserved communities, teaching hospitals and higher learning institutions

bonyi State will go down history as the first where a Federal University successfully went off-grid on a solar hybrid power plant, superintended by the Federal Government under the Rural Electrification Agency’s Energising Education Programme (EEP). On August 2, 2019, Yemi Osinbajo, Nigeria’s vice-president led other dignitaries to commission a 2.8 mega Watts (mW) of solar hybrid power at the Alex Ekwueme Federal University Ndufu-Alike Ikwo (FUNAI) in Ebonyi State. The project has multiplier effects through improved access to electrical power for students of the university. It will also rob off on business micro, small and medium businesses’ access to reliable electricity supply among communities surrounding the university. It is the first to be commissioned of 37 universities and seven affiliated teaching hospitals under the REA’s EEP focused on developing off-grid, independent power plants, as well as rehabilitating existing distribution infrastructure to supply clean, reliable power and renewable energy. Over 7,700 students and 1,819 faculty staff at FUNAI will have access to clean reliable energy. This programme will improve the quality of education, research and health care services at the federal universities and teaching hospitals across the country. The commissioning culminated in the graduation of twenty all-female Science Technology Engineering and Mathematics (STEM) participants who received certificates of completion for renewable energy training, launching of 7.5 kilometres of solar-powered street lights for illumination and safety, as well as a modern training centre for renewable energy. “As an agriculturist, my participation in the programme has opened my eyes and broadened my horizon. I think I have ventured into another area. I see my future in the renewable energy sector,” Kalu Oluchi, a 200-year level Agriculture undergraduate said. The FUNAI is one of the EEP Phase 1 university projects that will deliver clean and sustainable energy to nine Federal Universities and one University Teaching Hospital using solar hybrid and/or gas-fired captive power plants. The multi-million naira solar power plant under EEP first solar hybrid power plant has 8 mega Wattshour (mWh) capacity battery banks, inverters and power panel, a modern training centre and transformers. This is the outcome of collaboration between the Rural Electrification

L-R: Yemi Osinbajo, vice-president Federal Republic of Nigeria; David Nweze Umahi, Governor of Ebonyi State; Damilola Ogunbiyi, managing director and CEO of the Rural Electrification Agency and Chinedum Nwajiuba, vice-chancellor of FUNAI at the unveiling ceremony.

Agency, Ministry of Power, Works and Housing, the Federal Ministry of Environment, the National Universities Commission, and executed by Sterling & Wilson, a solutions and services provider that supplies businesses with solutions for solar, wind energy, transmission and distribution, hybrid energy storage and turnkey data centres to organisations across the world. Reiterating the Federal Government’s commitment to bring positive change to the educational system through its next level roadmap agenda, Osinbajo, guest of honour at the commissioning said no doubt the project would provide sustainable decentralised energy to the entire campus, improve education and create a better university experience for both students and staff. “Gone are the days when students read at night with candles, lanterns and torches. Our young people are willing to learn and they have great aspirations. It is our duty to aid them to accomplish their goals by providing an enabling learning environment for them. I am glad to be a part of this great feat,” Nigeria’s vice-president said. “Our students will not only reap the benefits of clean, reliable and affordable electricity, they will also receive hands-on training on renewable energy which can be applied beyond the walls of this university,” Osinbanjo quipped. Commending the federal government’s efforts in promoting and encouraging women, Osinbajo gave kudos to Damilola Ogunbiyi led administration at Rural Electrification www.businessday.ng

Agency for initiating female STEM internship under energising education programme. “We hope that this experience will inspire them to undertake STEM-related careers, including careers as engineers and project managers. I want to use this opportunity to congratulate all of them for this great achievement.” The EEP would last for the next four years as the train of progress moves to Bayero University Kano (BUK), Kano State and Federal University of Petroleum Resources Effurun (FUPRE), Delta State where it would commission other projects over the next couple of months.” Ogunbiyi, managing director and chief executive officer of the Rural Electrification Agency, said it was a great pleasure to commission the pioneer project under the EEP. She added that young Nigerians are the most important resource for future socio-economic development. With this in mind and fully aligned with this administration’s Next Level Roadmap, the President of the Federal Republic of Nigeria, Muhammadu Buhari, approved the EEP, which was conceptualised by Babatunde Fashola, the immediate past Minister of Power, Works and Housing, in 2016. Among Ogunbiyi’s responsibilities as the CEO of Nigeria’s REA is to provide reliable, affordable and sustainable power to 37 federal universities and 7 teaching hospitals through solar hybrid and gas-fired power plant solutions, rehabilitation of existing distribution infrastructure, installation of street lights for illumination and improved security within the

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beneficiary university campuses and construction of training centres to train students on renewable energy technology. “The first phase comprises nine federal universities and one teaching hospital, which cut across six geopolitical zones in Nigeria and fully funded by the Federal Government. This project here in FUNAI is the first to be commissioned today. EEP projects in Bayero University, Kano State and Federal University of Petroleum Resources, Effurun, in Delta State, will follow with commissioning scheduled within the next couple of months.” The 2.8mW, solar hybrid power plant has a total installed capacity that will result in 3.60 million kilograms of annual carbon dioxide savings. This is sustainable, clean and efficient energy at its finest; ultimately improving Nigeria’s ecological footprint. Furthermore, the installation of 7.5 km of street lighting has already made the university environment harmonious, comfortable and ultimately safer. “As we step into a future filled with smarter and cleaner technologies, we look forward to continuing to energise education and creating jobs through the remaining phases, for which the REA has secured funds for Phase 2 and Phase 3 from the World Bank and African Development Bank respectively, under the Nigeria Electrification Project,” Ogunbiyi stated. The United Kingdom’s Department for International Development (DFID) through its Nigeria Infrastructure Advisory Facility and Policy Development Facility programmes @Businessdayng

provided technical assistance in the development and implementation of the EEP. David Nweze Umahi, governor of Ebonyi State and an engineer said he was elated and thrilled that this achievement is happening in Ebonyi State under the EEP. “Ebonyi State is committed to ensuring that high-quality education is accessible to all; an education that produces driven, skilled and talented professionals that will be the engine for our growth and development as a nation. What better way to do this than having access to educational facilities powered by reliable clean energy?” Omahi said. The impact of the project goes beyond improving the quality of education but also generates a total of 108 jobs for Ebonyi indigenes and will create more during the operation and maintenance of the project. Chinedum Nwajiuba, vice-chancellor of FUNAI emphasised it was a privilege that this was happening under his administration, stressing that it will provide a comfortable learning environment for students. “You may be unaware, but Ebonyi State used to be among one of the educationally disadvantaged states. But over the last eight years since the establishment of this university, we have grown by leaps and bounds. We have developed a learning and research centre that offers students the latest in computing technology, new library facilities and a sports village,” Nwajiuba said. “We are now, also proud to add, the first solar hybrid power plant to be commissioned at a Federal University in Nigeria in addition to a renewable energy workshop/training centre and streetlights across the entire university that will provide a secure and safe learning environment.” Sonny Echono, an architect and permanent secretary at the Federal Ministry of Education, said “It is no secret that a good education has the power to change a life. Education empowers minds that will be able to conceive good thoughts and ideas. Combined with technologies that continue to develop at breakneck speed, the result is a world that has the want, and the means, to learn at scale. The challenge, therefore, is not just about providing access to education, but also ensuring progress in improving the quality thereof.” In her votes of thanks, Anita Otubu, head, Special Project, Rural Electrification project, thanked President Buhari and vice-president Osinbajo for their zeal and commitment to increasing electricity access and improving the quality of university education in the country.

Friday 09 August 2019

BUSINESS DAY

CULINARY DELIGHTS

Kohinoor the diamond restaurant in Ikate Lekki attention to detail and effort put into putting the space together. The decor is out of the box yet classy. A high-end modern sports bar is the description that comes to mind. They even have authentic vintage motorcycles on the inside as decor, which is something I have never seen before in Lagos. After doing some research we found our that the name Kohinoor was birthed by the owner’s many visits to India. He came across the name “Kohinoor” and was intrigued by it. In India, Kohinoor is one of the rarest diamonds in the world. As one who appreciates some of the finest

t was a rainy Sunday afternoon in Lagos and as work would have it we had a scheduled meeting for Sunday at 1 pm. As a food enthusiast, I was trying to find a place suitable for a Sunday lunch meeting. I decided to call my friend Edache Obe who is the founder of Dacheo Media a digital marketing company and Lagos Foodies Association, an official group of food lovers across Nigeria. He suggested we try out Kohinoor which is located on 72 Kusenla Road Ikate, Lekki. Ikate seemed far in my head but without the weekday traffic its a breeze to get to.

structured restaurant. I totally fell in love with the ambiance when I stepped in. The staff was extremely courteous and polite right from the doorman to the waiters. One other thing that will catch your attention is the wall paintings, the lighting, decoration, and the seating arrangement. I am still smiling at how impressed I was with their skills of paying attention to every single detail. The drinks came in quite quickly and it was nice. The chicken wings were extremely and spices were perfectly blended. The food was ok and we had a variety of spicy finger foods comprising of

Lehle (@lehlelalumiere) works at BusinessDay in Strategy Innovation and Partnerships, she is also a financial inclusion advocate and radio anchor. Originally from Senegal Lehle has a passion for culinary experiences and enjoys discovering new restaurants in Lagos. Follow @ bdculinarydelights on Instagram

GUEST

LINDA OCHUGBUA

On this occasion, I had a lunch meeting with my boss Oghenovwoke Ighure who is the Executive Director of the department of Strategy Innovation and Partnerships at BusinesDay Media and Linda Ochugbua who is the digital sales manager at BusinessDay Media. They are both incredibly accomplished and intelligent individuals who are responsible for furthering so many important causes in relation to business, entrepreneurship and policy change in Nigeria and beyond. It is a great privilege to work with both of them. As I entered Kohinoor, I was blown away by the decor, the artwork and the

things in life, he was taken by the name & decided to christen his luxury restaurant, bar & lounge “Kohinoor Lagos”. The waiter greeted us and brought over the menu. The menu is vast at Kohinoor and one will never run out of options. The menu is a blend of continental and African dishes. After much deliberation and some help from our waiter, I decided to have the T bone steak which came with french fries and vegetables. The steak left a little to the imagination but the fries were very good and the veggies were fresh. Here is Linda’s review of Kohinoor. “Kohinoor is a well-planned and

chicken wings, samosas, goat meat, etc. It was a nice restaurant and I am delighted that I found this new spot in Lekki”. Vwoke enjoyed his food as well and particularly enjoyed the chicken wings. Kohinoor is more than a restaurant as it organizes weekly theme nights such as Salsa dancing, Karaoke, Game’s Night, 90’s night and much much more. it’s perfect for all types fo occasions birthdays, business meetings, date night, lunch, brunch or dinner. Kohinoor Lagos serves an array of delicacies, both continental & African, to satisfy the palates of all irrespective of what their preferences are.

RATING 4 Frutti de Mare (Seafood Okro) - N4,200 Meat Platter

- N15,000

T-bone Steak

- N8,750

4 Smoothies Total

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- N2,500 each - N34700

CONTACT: 0906 000 8436 info@kohinoorhospitalities.com

To make recommendations or for collaborations please send an email to lehle.balde@businessday.ng www.businessday.ng

Thursday 09 August 2019

BUSINESS DAY

THE INTERVIEW

The tastemaker

During his recent visit to Nigeria, BENJAMIN SMITH, Hennessy Business Development Manager for Africa & Middle East, spoke with TAYO FAGBULE (Editorial Board Chairman) & MICHEAL ANI (Analyst) of BusinessDay, about how Hennessy is experienced in Nigeria, one of its fastest growing and it’s second-largest market in Africa

hat’s it like to be an Aussie based in France overseeing a premium spirit for Middle East and Africa? It’s an opportunity I had in my sight for my years. I worked for Hennessy for 12 years in Australia before they offered me this incredible, exciting role. It involved moving to Paris; I split my time between Paris and Cognac which is great since you get the best of both worlds: the incredible city of Paris but then you get to spend time in Cognac which is a beautiful small French town totally devoted to cognac; it’s all about cognac in Cognac. You get an amazing opportunity to spend a lot time at our home in Cognac. The best part of the role for me is to be able to travel to Africa frequently to work closely with the team. Africa is the fastest growing market in the world for Hennessy and to work in a market that is so dynamic, for a brand I love, is a dream and I’m blessed. How steep has this learning curve been? If you have a passion, it’s one of those things you can’t know it all; new products, new trends that’s why I love this industry, there’s always something new to learn. There is a never a dull moment. I’m here now in Nigeria working for a brand I love; I wouldn’t have it any other way, hosting events and taking people through the experience. I’m very fortunate to be in this position.

Ade Adefeko

In the premium spirits market the newworld is differentiated from the oldworld. You’re from the new-world (Australia) selling a brand from the old-world (France) in Africa, the fastest-growing Bio: Australia born, France based, Hennessy Business Development Manager for Africa & Middle East. Benjamin Smith has over 15 years’ experience in premium spirits, with the past 10 years within Moët Hennessy (LVMH). Benjamin’s career began in 2001, at Beringer Blass then Bacchant Wine Merchants, where he worked with some of the most respected wine brands in Australia. In 2006, Benjamin joined Moët Hennessy Australia and worked across the portfolio (including Hennessy, Belvedere, Dom Perignon, Veuve Clicquot & Domaine Chandon) in several senior roles including National Trade Marketing Manager & National Sales Manager. In 2018, Benjamin moved from Sydney to Paris, with his wife and son, to commence his new role as Hennessy Business Development Manager for Africa & Middle East. He has a true passion for cognac education, and will be a frequent visitor to Africa in the coming years. His mission will be to inspire, key trade and consumers, about the unique savior-faire of Hennessy.

market for Hennessy. How is that panning out? In terms of an old brand playing in a new market, it seems to be working well. Hennessy is an old brand established in 1759, it’s been around for over 250 years. But we’re not new to Africa. It’s important to understand that we tracked the 1st shipment to Africa back to 1866. So it’s not a brand that just popped up in the last 20 or 30 years; we’ve been around for a very, very long time. And the beautiful thing about Hennessy, from the beginning, is that it’s not a onesize-fits-all approach. We make the same cognac, it’s the only thing we do but we’re not prescriptive about the way different countries consume it. We’re not prescriptive about the way different countries activate, bring the brand alive in their market. That has been the success of Hennessy. In Africa we’re not trying to do same thing as in China, it’s a completely approach. It’s bespoke. What we do in Africa for Hennessy is for Africa. Advertising campaign is specifically for Africa. The way Hennessy is consumed, for instance in Nigeria it’s con-

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sumed in nightclubs. You have to embrace what’s happening locally to be a successful brand. And it seems to be working and we don’t want to change it. You talked about rolling out different strategies for different countries. What kind of strategy are you using to market your brand in a country like Nigeria where almost everyone believes that all wine is red? To be successful you need to appeal to all your consumers. In Africa we see there are many different consumers of Hennessy. There is a wide demographic: men, women, all of different ages. We have a portfolio of products as well, VS, VSOP, XO and rare cognac collection. The strategy to engage is to ensure you’re speaking in the right way to your consumers. Education is part of it. In Nigeria we’re seeing consumers who want to learn more about how we create cognac. At Hennessy we take education seriously; it’s a big part of my role. My favourite part is to get to speak to and train our internal staff, trade partners

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and consumers about how we turn grapes into cognac. They need to understand why cognac is different from whiskey. The younger generation of consumers is thirsty for knowledge. They want to understand more about what they are drinking. And that’s the key to get them at the luxury end of the market; they have to be passionate about what’s in the glass; the process of how we create cognac using since traditional methods since we were established 250 years ago. That’s part of the strategy. You need to inspire people about what’s in the glass. For other consumers how it’s made isn’t that important. It’s about establishing a connection with the brand, making a lifestyle of Hennessy. I think that’s what we’ve done really well in Africa; Hennessy isn’t just a drink, it’s a lifestyle. For consumers that aren’t that interested about how it’s made, it’s all about creating incredible experiences for them and doing whatever it takes to strengthen that connection with the brand. This is working in Africa where you can feel a passion for Hennessy. That’s why I enjoy this part of my job which involves overseeing Africa. We share a passion for Hennessy. It’s a fantastic opportunity.

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THE INTERVIEW Could you give us a crash course about premium spirits and the Hennessy brand? My pleasure. To understand Hennessy you have to understand Cognac which is a region in France. It’s the largest white wine-growing region in the world, double the size of Champagne. You need a lot of grapes because you lose a lot in the distilling and maturing process. Richard Hennessy, our founder, an Irish entrepreneur, established the business. Since the beginning we’ve been looking beyond the horizon, setting the pace for the cognac category. We invented the classifications you know today: VS, VSOP, and XO. Hennessy, as the industry leader, sets those classifications which are all about quality control. One classification isn’t better than the other but it’s important for consumers to understand each classification has a certain style. At Hennessy we understood early on that cognac is so versatile that you need these classifications for consumers to understand. We’re also the pioneer of taking cognac around the world. In particular, Richard’s son, James Hennessy, had that spirit of conquest; he wanted to explore new territories. As I said, we tracked our first shipment of barrels to Africa to 1866; South Africa and Zanzibar (1898) were the earliest shipments. Our first shipment to Nigeria was in 1920. Our 100th anniversary comes up next year. Premium spirits is a booming category. Spirits priced above $20 are premium. Hennessy is the number one international premium spirit brand; a recent achievement which we’re thrilled about. It’s a dynamic category. You have consumers looking to trade up to luxury spirits. Globally, people are drinking less but better – that plays to us. If consumers are going to spend that extra money they want the stories, they want the connection. Of course, the product has to deliver. The premium spirit is where you want to be playing. In the last 20 years the segment has grown by 69 percent. Looking at your market in Africa can you give us an overview the share of Nigeria? You can’t be everywhere in Africa; we’d like to be but there is a limited amount of stock allocations so we have to be focused about where we activate in Africa. We have the big two: South Africa and Nigeria are our biggest markets. Nigeria, our second-largest in Africa, is growing at an incredible rate. Then we have our boost markets: East Africa and few others where we see huge potential. The strategy is to have the best people on the ground – it’s all about the people. If you have a great brand but the wrong people you’re not going to be successful. And we want to be in the best venues.

to a wide supply of different edelweiss is important. The big thing at Hennessy is the forwardthinking you need to be a successful cognac house. The minimum age of edelweiss in VS is three years; we blend edelweiss from three to eight years. For VSOP, the minimum is 4 to 15 years; for XO, the category we set recently is 10-year old edelweiss but we go above that to 12 years and up to about 30 years. This s isn’t to say whiskey is easier to make by any stretch but cognac is very complex because you need all different components to make consistent cognac. And you need to be thinking 5, 10, 12 years down the track to be successful. In order to respond quickly you need to foresee what the future holds in terms of the different classifications. For example, where is XO going to be in Nigeria in 10 years? That time frame is the minimum it takes to produce grapes. You have to have a long term view.

That’s our strategy: the best people working for the brand in the best venues, because that’s where you create those experiences, being in the top venues is what drives the connection with our consumers. It’s where everybody is looking. Do you see the rising music industry driving the growth consumption for Hennessy in Nigeria? Nigeria, without a doubt, is one of our fastest growing markets globally. And that success can be attributed to some of the top Afrobeats artistes’ passion for Hennessy. I was lucky to attend our last Hennessy Artistry event in Lagos and it was incredible to see these Nigerian superstars with bottles in hand. This has a huge knock on effect. It helps establish those connections; it makes consumers want to be associated. They want that lifestyle as well. It’s hard to say what this has contributed to sales but it’s important. A big star’s connection with brand is huge for us. Does this explain why Nigerian artistes are featured in your adverts? At the moment we have “All I need” which is our ad campaign. Again, it is an Africaspecific ad campaign that was launched two years ago. It’s a big step forward – in the previous campaigns you had a lot of colour, more energy – it speaks to what Hennessy is to Africa today. To be honest, I think it is one of the most exciting things we’ve done at Hennessy. We’re proud of it. That campaign features eight carefully selected vanguards from all across Africa; the Nigerian artiste is Kaffy, megastar dancer. Her values match perfectly with Hennessy. Hennessy is in a niche market. What’s driving the growth in consumption – is it price or volume? www.businessday.ng

It’s always a value game at Hennessy. We don’t have an endless supply to flood the market with stock. For a product that is aspirational, it’s always a value game. What’s driving the growth is different in did areas. We are certainly seeing more females gravitating towards the brand which is exciting to see. It’s hard to pigeonhole your stereotypical consumer because you appeal to so many people. The younger generation are looking to establish the lifestyle the artistes I mentioned are helping to establish, it’s a huge a catalyst for consumption. We also find an older generation (in the late 30s) coming into that category. Potentially, they are single malt drinkers and they want to experience something different. People are jumping across categories – which we love. It’s all about variety. Again, education: what’s the difference between cognac and whiskey? And the occasions are infinite. You can drink Hennessy as neat, with ice, mixed cocktail. Cocktail is another thing we’ve seen that has started to emerge. And that’s a big opportunity for Hennessy to play in the cocktail space. Growth isn’t from a single group or occasion we decided to tap into. It’s such a versatile brand. Could differentiate between Jameson, which is doing well in Nigeria, and Hennessy? Jameson is an Irish whiskey. It’s made from grains. It’s a great product performing well in Nigeria and, globally, it’s in a lot of markets where Hennessy is doing well. Hennessy is a cognac made from grapes. Both are consistent products. It’s very hard to make consistent cognac because you have different tasting grapes, depending on the season, which give different tasting edelweiss after we distill the grapes. Access

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Champagne imports to Nigeria over the past four to five years have shrunk. Consumers’ purchasing power too is shrinking. How has Hennessy fared? Hennessy isn’t immune to economic circumstances. During a slump a softening is expected. From 2014 through to 2016 we suffered, like all brands. At Hennessy it isn’t about knee-jerk reactions, panicking. You need to have a long term strategy because it takes a long time to make our product. And we’re confident with our strategy. We know Nigeria is a dominant market, we knew it was going to bounce back; we didn’t make any drastic change. We knew we would ride it out. And the last two years have been impressive. We’re back. Data shows that when things are tough people look for affordable luxuries, even when times are tough you still want to reward yourself sometimes. Maybe you can’t buy a handbag or a new car; you can reward yourself from time to time. Hennessy sort of fits in that affordable luxury. What has changed since your last visit to Nigeria? This is my third visit to Lagos and my first time to Abuja. Things are always changing especially the nightlife. All the clubs are trying to take the experience one level up. You get the impression this is the experience then another club raises the level. For me the energy you feel at night I haven’t felt elsewhere, the music, the energy, the sense of community. Everybody is there to have a good time. And it doesn’t matter what day of the week it is. I felt this partying with passion and connection with Hennessy during my previous visit but it’s the intensity that has changed. I love every minute of my visit to Nigeria. It was good to visit Abuja as well; it was my first time there. Very exciting market, different but the love for Hennessy is there. You can’t take it for granted. It has to be nourished. We have a great local team here, strong long term partnerships with the venues; they are the key. If you’re not in those venues you can’t create the experiences needed for the connection. I can’t wait to come back for the 10th anniversary of Artistry in December of which you’ll hear more about. We’ll soon communicate about what’s in store. It’s more than an event. We have our VS-Class auditions happening across Nigeria, to unearth the next generation of Afrobeats artistes who will perform at the event as well as our headliners plus a few other exciting developments I can’t talk about yet. We’ll be back. I can’t wait.

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Friday 09 August 2019

BUSINESS DAY

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E-Tranzact’s plan for blockchain switching platform could upturn payment space FRANK ELEANYA

-Tranzact, the pioneer of fintech services like Unstr ucture d Supplementary Service Data (USSD) and mobile money in Nigeria, said on Tuesday it is working with a foreign consortium on a blockchain switching platform which it hopes to launch very soon. When launched, the platform could potentially bring drastic transformation to the country’s digital payment space as well as mark a watershed in the use of blockchain technology beyond cryptocurrencies. Blockchain is the underlying technology of the digital currency bitcoin. In the simplest terms, it refers to a time-stamped series of immutable record of data that is managed by a cluster of computers not owned by any single entity. Each of these blocks of data (e.i data) are secured and bound to each other using cryptographic principles known as chains. The blockchain has no central authority, hence it is the definition of a democratized system. Since it is a shared and immutable ledger, the information in it is open for anyone and everyone to see. In essence, anything that is built on the blockchain is by its very nature transparent and everyone involved is accountable for their actions. Until recently, the world

of financial services have only associated blockchain mostly with cryptocurrencies, the chief and first of which is bitcoin. In Nigeria, the cryptocurrency market has been so dominant that authorities have had to express concern at the rate of adoption and potential risks it could portend for financial services. On different occasions, therefore, the Central Bank of Nigeria (CBN) has issued warnings to customers, harping on the inherent risk of the cryptocurrency market especially its susceptibility to high volatility and internet criminals. But constant engagement with stakeholders in blockchain technology has

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tempered the CBN’s stand, thereby giving more latitude for operators in financial services to study the new market for more opportunities. While E-tranzact’s imminent foray into blockchain technology may not be the first time a Nigerian company in financial services is exploiting the segment, it could be the most ambitious so far, going by the bullish disposition of the company’s leaders. “We want to be the switching service of choice for every organisation in Nigeria,” said Niyi Toluwalope, CEO of the company at a briefing on Tuesday. For a company that said it processed over N30 trillion in

online payments, enabled over 2 million mobile money transactions, with an expanding network of 15,000 agents and has onboarded all the banks in Nigeria on its platform, there is every reason to be optimistic that it could achieve the target. Moreover, in late last year E-Tranzact secured N7 billion from investors. Much of that investment will go into improving its payment technology and human capital development. E-Tranzact’s ambition also aligns with a growing grasp by companies in the financial services that blockchain technology - while it may seem too complicated from the outside - is relatively easy

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to build, meaning that they can construct a shared distributed ledger themselves thereby doing away with the role of a trusted third party and potentially crashing the cost of transaction charges. Though a blockchain may carry an infrastructure cost, it does not have transaction cost. It is a simple yet ingenious way of passing information from one entity to another in a fully automated and safe manner. To break down further, one party to a transaction initiates the process by creating a block. This block is verified by thousands, perhaps millions of computers distributed around the net. The verified block is added to a chain, which is

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stored across the net, creating not just a unique record, but a unique record with a unique history. Falsifying a single record would mean falsifying the entire chain in millions of instances. That is virtually impossible. A switching platform would enable E-Tranzact to facilitate communication between various providers in a more efficient manner. For instance when you buy things from an online store that requires payment before delivery, you pay on an app or the web before the goods are shipped. For making that payment the credit card company takes a cut for processing the transaction. With a blockchain switching platform, not only can store save on credit card,it can move the entire buying process to the blockchain. This reduces the number of people in the transaction to just the store and you, the customer. Additionally, it can improve cross-border payments by offering added security, higher transfer speed, and lower conversion fees. It is likely that E-Tranzact would decide on a closed, permissioned system - one that would exist within a regulated market with an identifiable regulator who would determine which players would be allowed to operate within that community. This could foreclose the prospect of it creating its own virtual coin someday.

Friday 09 August 2019

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Nigeria courts hunger as insecurity... Continued from page 1 vast array of crops, found itself in the company of Yemen, the Democratic Republic of the Congo, Afghanistan, Ethiopia, the Syrian Arab Republic, the Sudan, and South Sudan. At the peak of the lean season last year, 3 million people were reported to be acutely food-insecure in the three north-eastern states affected by the Boko Haram insurgency were protracted conflict and mass displacement disrupted agriculture, trade, markets and livelihoods, and pushed up food prices. Things may improve, but they could also get worse. An additional 22.7 million Nigerians in the north alone are at risk of food crisis if things do not improve. The number will increase dramatically when the southern regions begin to feel the pinch of insecurity more than being currently experienced. Across Nigeria, from kidnapping to bandit attacks, invasion of farmlands by suspected herdsmen and other violent clashes, the farmlands are increasingly becoming battlefields where mostly unarmed farmers are slaughtered. For mostly small-holder farmers who feel they have no choice other than to farm, they brave the odds, but may or may not make it home alive from the farm. Despite repeated statements by the Federal Government that Boko Haram has been defeated, the insurgent group occasionally still springs attacks, and in most cases, the casualties are farmers. A visit to Borno and Yobe States last year revealed most farmers have relocated to IDP camps, and those who are in the villages live in fear and dare not venture to the farms. Today, the situation has not changed. “The situation remains the same; nobody can go to the farms. You cannot go outside Maiduguri and off the road for about two to five kilometres (for fear of Boko Haram),” said Abdulkadir Jidda, chairman, All Farmers Association of Nigeria (AFAN), Born State Chapter, in a phone interview on Thursday. The most recent attack on farmers, according to him, was over a week ago when about 17 farmers were killed in attacks in three different locations – Damboa road, Monguno road, and the Maiduguri-Damaturu road – all on the same day. For others who are big farmers and have invested several millions (and even billions) of naira into farming, they simply abandon the farms as the risk of maiming during attacks, or even death, is not one they are willing to take. “The snowball effect of

insecurity will start being felt by the first quarter of next year in food prices,” said Rotimi Williams, CEO, Kereskuk Rice Farm, who told BusinessDay he had to suspend operations on his 45,000-hectare rice farm in Nasarawa. “It is devastating and government has to do something about it very quickly.” Williams explained that as long as insecurity persists, “nobody is going to provide funding (for agriculture)”. When attacks occur, the staff have to run as fast and far away as they can, and more often than not, crops that have been cultivated are lost. “If we are going to talk about agriculture in any sense, security is the first thing that must be tackled. These communal conflicts have to end. This farmers-herders issue honestly has to be brought to a stop,” he said. Williams is not the only ‘big farmer’ who has abandoned his farm. Even though the actual number of farms that have shut down cannot be ascertained, several dozens of big multi-million naira farms have suspended operations. For the smallholder farmers, thousands of them have put their sources of livelihoods on hold, as they hope to preserve their lives by not falling prey to insecurity. “If one had no reserve, by now one would have committed suicide,” said Olumide Abayomi, a chartered account and fellow of the Institute of Chartered Accountants of Nigeria (ICAN), who retired from his lucrative job at African Capital Alliance, a private equity firm, in 2013. In an earlier publication by BusinessDay, Abayomi had lamented losses incurred after crops on his 450-acre farm in Osun State were eaten up by cattle, which, according to him, were brought by Fulani herdsmen. “I invested heavily and wanted to really do agriculture,” he said, recalling he had spent an estimated N110 million on the farmland located in Osuntedo village, Osun State. Abandoned on the farm after the herders plundered it with their cattle is a bulldozer bought for about $126,000 (N45.4 million), one he said is one of the biggest in the country. Nigeria has for years hoped to position agriculture as a means of ‘diversifying the economy’, but this aspiration hangs on a rather thin thread as insecurity makes it increasingly difficult for agricultural activities to thrive. The smallholder farmers in different parts of the country do not feel safe to visit their farms, while the big farmers with millions of naira to invest are equally scared to commit their funds into a venture that may sink their money and also take their life. www.businessday.ng

L-R: Akinbambo Ibidapo-Obe, general manager, commercial, Oando Energy Resources; Ainojie Irune, chief operating officer, Oando Energy Resources; Jorge Bom Jesus, prime minister of São Tomé and Príncipe (STP), and Osvaldo Aubreu, minister of infrastructure, natural resources and environment of STP, during a courtesy visit by the Oando executives to the prime minister of STP to discuss, amongst other initiatives, how Oando can support the country’s oil and gas sector through knowledge transfer.

MTN Nigeria set for million dollar.... Continued from page 1 Stanley Capital International (MSCI) Frontier index could pave the way for as much as $8.5 million worth of buy interests from fund managers, according to calculations by investment bank, EFG Hermes.

MSCI, a global provider of research-based indexes and analysts, published results of its August quarterly review Thursday, which showed the Nigerian unit of South-African telecommunications company, MTNN, will be the sole addition to the frontier index come August 27. MTNN’s shares gained 3.27 percent, Thursday, the biggest jump since May 24, according to the telco’s share price data tracked by Business Day. Analysts expect MTNN’s share price to rally in the days leading to August 27 as investors take positions ahead of the buying boost to be unlocked by the Nigerian Telco’s inclusion on the MSCI frontier index. Shares of parent company, MTN Group, were however down 1.9 percent in South Africa on Thursday. ‘Based on our calculations, we also expect MTNN to join the MSCI FM 100 Index, as a result we expect it to see $5 million worth of passive inflows,” Olamide Shonekan of the sales and trading desk at EFG Hermes, said. “In addition, MTNN should see $3.5 million from Nigeria trackers at close of business 27 August (when the Telco will be officially included on the index),” Shonekan added. That comes to a total of $8.5 million in potential inflows. MTNN will account for 0.8 percent of the MSCI frontier index and 12.9 percent of MSCI Nigeria Standard Index, ranking it the fourth largest Nigerian company on the index, behind Dangote Cement, Guaranty Trust bank and Nestle. Other local heavyweights on the index include Zenith Bank, Nigerian Breweries, Stanbic IBTC, Seplat, First Bank of Nigeria Holdings

and Ecobank. MTNN’s addition also means Nigeria’s weight will climb to 19.4 percent from 17.4 percent among African countries (bar South-Africa) on the MSCI frontier index, taking Abuja ahead of Kenya- whose weighting goes from 17.5 percent to 17.9 percent- and into third place behind Morocco (30.8 percent) and Egypt (22.7 percent). telecommunication companies will gain 2 percent weight within the index with MTNN’s inclusion. That implies that banks and telecommunication companies now account for 72 percent of MSCI Africa, without accounting for South Africa. Nigeria largest mobile phone subscriber, MTNN, became the second largest publicly traded company in Nigeria after making its debut on the Stock Exchange three months ago on May 16, nearly three years after MTN Group first promised to list its Nigerian business on the Lagos stock exchange. The share sale was done via a listing by introduction, which meant only pre-existing Nigerian investors who previously bought and sold their shares over the counter were able to trade publicly. The Group said at the time that an Initial Public Offering (IPO) was on the way. MTNN’s listing had an immediate impact on the stock exchange, adding the regulatory maximum 10 percent daily gain for a week. Nigerian stocks were on track for their ninth straight day of losses until MTNN’s shares listing reversed the loss into a gain of 0.5%, the best showing in almost a month. That charge soon slowed as the general bearish sentiments towards Nigerian stocks soon took the wind out of the sails of the telco. MTNN’s N132.50 Thursday price is 11 percent lower than a peak of N140 achieved May 23.

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Akintola Williams: Africa’s first chartered... Continued from page 1 in Nigeria.

Born on August 9, 1919, in Lagos to the affluent yet humble family of Thomas Ekundayo Williams who was a successful lawyer and businessman, Akintola Williams’ life is a success story as he overlooked the luxury around him and pursued his career with utmost diligence despite the challenges that accompanied it, this made him attain the peak of his career. Williams has sustained the success in his family lineage. His grandfather, Zachariah Archibald Williams, was a merchant and farmer from the ancient city of Abeokuta, and his father was a clerk in the colonial service who established a legal practice in Lagos, after he returned from London in 1923 where he studied, to practice the profession until 1938 when he died at a young age of 48. Nigeria’s first chartered accountant began his primary school education in 1928 at Olowogbowo Methodist Primary School, Apongbon, Lagos. Shortly after, he proceeded to Church Missionary Society (CMS) Grammar School, Bariga, Lagos in 1938 for his secondary school education with records of academic success. Akintola Williams was among the twelve students who sat the final Cambridge certificate examination in 1938 and came out in flying colours – he was exempted from the London Matriculation Examination, an unusual feat at that time. With his enviable records in secondary school such as being the most brilliant student at the time, he won a scholarship funded by the United African Company (UAC) after he gained ad@Businessdayng

mission to study at the Yaba Higher College in 1939 where he was awarded a Diploma in Commerce in 1941. He proceeded to the United Kingdom in 1944 on a Nigerian government scholarship to train as a chartered accountant. While Williams was preparing for his accountancy examinations, he completed a Bachelor’s degree in Commerce at the University of London in 1946. Three years after, he successfully passed the final examinations of the Institute of Chartered Accountants in England and Wales and became a member of the institute in 1950, making him the first Nigerian and one of the first black Africans to become a chartered accountant in the United Kingdom. In the midst of all these, Akintola was keenly interested to use his wealth of knowledge to contribute to the development of the nation. He returned to Nigeria in 1950 to serve in the Inland Revenue as an assessment officer in the agency, a position he occupied until 1952. He resigned from the civil service and founded Akintola Williams & Co., now Deloitte & Touche, in 1952. The establishment of Akintola Williams & Co. came at a time when the accountancy business was dominated by five large foreign firms. Although some local accounting firms were in existence, they were certified rather than chartered accountants. Severally indigenous companies including

Nnamdi Azikwe’s West African Pilot, K.O Mbadkwe’s African Insurance Company, Fawehinmi Furniture and Ojukwu Transport engaged the services of his firm.

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Friday 09 August 2019

BUSINESS DAY

Sports Gov. Sanwo-Olu says Lagos committed to hosting FIFA U20 Women’s World Cup Stories By Anthony Nlebem

overnor Babajide Sanwo-Olu of Lagos State has assured officials of world football –governing body, FIFA that the Centre of Excellence has the will and the capacity to ensure it meets the requirements for hosting the 10th FIFA U20 Women’s World Cup finals next year. Describing the estimated 22 million people of Lagos as resourceful, dynamic and full of positive energy, Sanwo-Olu noted that the strength of the state lay in its diversity and a youth population driven by the will to succeed. “We want to use sport as an engaging tool, as a corrective narrative to show that the positive energy of the youth can indeed take a society to a high level. I want to assure that we are ready to meet your high standards in the areas of accommodation, security, logistics and crowd management, and also savour that unique experience of hosting a FIFA tournament. “I want you to see Lagos State as a partner that understands that your next tournament must be better than the last. We will make sure

to upgrade facilities wherever this is required,” Sanwo-Olu said as an inspection team from FIFA and including officials of the Nigeria Football Federation, Amaju Melvin Pinnick, paid him a courtesy call in his office on Tuesday. Describing Pinnick, who is a Member of the CAF Executive Committee and Member of Organizing Committee for FIFA Competitions, as “a resourceful, award –winning, never-say-die, self-driven and strong believer in the Nigerian Project,” Sanwo-Olu said Lagos State was excited to be included in the plan to host the first –ever FIFA women’s tournament in Africa, and would do everything to make Nigeria and Africa proud. Earlier, Pinnick had introduced the FIFA team, led by Rhiannon Martin (Head of FIFA Women’s Football Organizing) and including Christopher Exley, Heyral Jurgen, Sara Jane Booth and Kliment Taseski, saying that the world body has tremendous confidence in Nigeria to meet its requirements to host the championship. “Our country is one of only four countries in the world to have played at every edition of the FIFA U20 Women’s World Cup since it began in 2002. We have played in two Final matches and reached the semi final once. I

believe it is time to take it to the next level. It is time we win the competition and it would be even more fulfilling to win it on home ground.” The FIFA team and accompanying Nigerian officials had earlier inspected facilities and equipment at the Onikan Stadium, St. Nicholas Hospital, Campos Square, Eagle Club, Teslim Balogun Stadium and the National Stadium Leagcy Pitch before arriving at the Governor’s office. FIFA officials and some NFF and Lagos FA officials led by the 1st Vice President, Barr. Seyi Akinwunmi, inspected the Agege Stadium, Lagos State University Teaching Hospital, University of Lagos Sports Centre and the Yaba College of Technology Sports Centre. The party that visited Governor Sanwo-Olu also included Barr. Akinwunmi (NFF 1st Vice President), Dr. Kweku Tandoh (Chairman, Lagos State Sports Commission), Mr. Toyin Gafaar (DG, Lagos State Sports Commission), Ms Aisha Falode (NFF Executive Committee member), Mr. Mainasara Illo (Coordinator of the Tour), Dr. Paul Onyeudo, CP Umar Baba (NFF Security Adviser), Ademola Olajire (NFF Director of Communications), Emmanuel Ayanbunmi (NFF Protocol Officer); Dotun Coker (Lagos FA) and Ladi Idowu (Lagos State Sports Commission).

Lagos State Governor, Babajide Sanwo-Olu (right) with NFF President, Amaju Pinnick (left) and leader of FIFA team Rhiannon Martin, Head of FIFA Women’s Football Organizing (middle) in Lagos on Tuesday during FIFA’s facilities inspection tour.

GOtv Boxing NextGen 5 holds in Ilorin — Organisers

n a bid to provide opportunities for young and aspiring boxers desiring to turn professional, Flykite Productions, organisers of GOtv Boxing will on August 29 and 30 converge at Kwara Stadium Complex, Ilorin for the 2019 edition of the Gotv Boxing NextGen 5. The organisers said the twoday programme, sponsored by pay television service provider, GOtv, was developed to unearth young and talented amateur boxers, aged between 18 and 25 desiring professional level. “The participants are required to take part in sparring sessions conducted by prominent boxing coaches, who will select boxers considered ready to move into the professional cadre. “The boxers selected by the coaches will have their professional licences and free medical examination paid for by the sponsors as well as have the opportunity to fight in coming editions of GOtv Boxing Night,” they said in a statement. The organisers also disclosed that registration forms for the programme were available free of charge at the Kwara State Boxing Association Office and Referees and Judges Association Office, both at the Kwara Complex, Ilorin. The forms, they said were available at Akure Stadium Complex, Akure, Alake Sports Centre, Abeokuta, Oyo State Boxing Association Office, Lekan Salami Stadium in Ibadan. The Lagos Boxing Hall of Fame Gym, Surulere, Lagos and the Nigerian Boxing Board of Control (NBB of C) Secretariat, National Stadium

in Lagos. The third time the programme is holding outside Lagos since debuting in 2015. “In 2017, it held at the Francis Aiyegbeni Boxing Gym in Ibadan. Last year, it held at Dunkin Pepper Gym of the MKO International Stadium Complex, Abeokuta. “The first two editions that held at the Lagos Boxing Hall of Fame Gym in Surulere and attracted over a 100 boxers, out of which 25 were considered ready for the professional ranks. “Since its debut, GOtv Boxing NextGen Search has helped many boxers rise to local and international prominence. “Among these is incumbent West African Boxing Union (WABU) Welterweight champion, Rilwan “Baby Face” Babatunde, who was discovered at GOtv Boxing NextGen 1 in Lagos,” the organisers said. They noted that Babatunde went on to become the national champion before clinching the sub-regional title and was in line for the African Boxing Union (ABU) title. He has, also, on two occasions, won the best boxer award at GOtv Boxing Night, respectively winning cash prizes of N2 million and N1 million attached to the award. Other high-flying graduates of GOtv Boxing NextGen Search are Ridwan “Scorpion” Oyekola, winner of the best boxer award at GOtv Boxing Night 15. The current national super Featherweight champion, Opeyemi “Sense” Adeyemi, the best boxer at GOtv Boxing Night 18, Tope “TP Rock” Musa and Prince “Lion” Nwoye.

Fireworks in England as Premier League kicks off today

fter a long wait, the much awaited 2019/20 Premier League season begins this Friday as sports fans gear up for an exciting and best of football actions. The season opens on at Anfield, where last season’s runners-up, Liverpool, take on newly promoted Norwich City. The main narrative in the build-up to the match will focus on the tactical battle between German coaches Jurgen Klopp and Daniel Farke – two men who have both helmed Borussia Dortmund and

now find themselves going head-tohead in the Premier League. Saturday’s opening game sees Premier League champions Manchester City open their title defence with an away trip to West Ham United. City manager, Pep Guardiola, will want to see his team get off to a flying start as they aim to emulate crosstown rivals Manchester United as the only team to win three successive titles in the Premier League era. Also in action on Saturday is newly-promoted Sheffield United and Aston Villa (away to Bournemouth www.businessday.ng

and Tottenham Hotspur respectively), Burnley take on Southampton, Crystal Palace host Everton and Wat-

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ford face off against Brighton & Hove Albion. Sunday’s feature game comes at Old Trafford where new Chelsea manager Frank Lampard has a potential baptism of fire away to Manchester United. The Blues legend replaced Maurizio Sarri at the helm of the London club and will be looking to lay down a marker against Ole Gunnar Solskjaer’s Red Devils in what promises to be a thrilling clash, live on SuperSport. Also, on Sunday Arsenal head to St. James Park to battle New@Businessdayng

castle United, in a match which should feature high-profile signings Nicolas Pepe and Joelinton, who cost a combined £112m, and Leicester City take on Wolverhampton Wanderers at the King Power Stadium. All these games will be Live on DStv on SuperSport 3. DStv Compact customers and above will have access to the best matches of each round. GOtv Max and Plus, as well as DStv Access and Family customers, won’t miss out either, with access to a number of live matches.

Friday 09 August 2019

BUSINESS DAY

Hotels

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

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

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

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

Ife Grand Resort; a pristine offering within OBINNA EMELIKE

n a typical visit to Ile Ife, you will appreciate the rich cultural heritage of the ancient town. While the rich heritage is a big draw for tourists, especially African Diasporas, there is another reason to visit the town famed as the cradle of the Yoruba race. The Ife Grand Resort & Leisure is worth experiencing while in the university town. Set on 250 acres of land on Kilometre 4, Ibadan Road, Ile-Ife, Osun State, the resort is a tropical paradise for leisure seekers and discerning guests who cherish tranquility and communion with nature amid personalised

services. From the entrance, fresh air greets you while the warmth at the concierge sets you in the mood for indulgence. For lovers of aesthetics, the locally crafted concierge table, the bespoke furniture decorated with local fabrics such as Adire and Ankara, the centre tables made from timber cuttings, and the walls dotted with beautiful artworks, combine to delight the five senses, especially sight. On offer at the resort are 68 rooms comprising 6, 8 and 10 room chalets and also single room option. The intrigue is that the furnishings are sourced locally and you do not need to probe further to discover that the doors are made from local wood variants such as bamboo. For the culture enthusiasts, the re-

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sort hosts an African Village with 51 stylish huts named after the past Ooniâ&#x20AC;&#x2122;s (paramount rulers of Ile-Ife). The huts come in one-room in-suite amid world class facilities. Besides the huts, the African Village hosts Bamboo Restaurant and a local kitchen where guests can visit to witness how local food menus are prepared and also served to them in local pots; an offering said to interest African Diasporas most. While in the village, guests have access to a standard swimming pool and children pool. However, the resort hosts a big restaurant and a stylish open bar, a replica of the floating bar on the Lagoon at Inagbe Grand Resort Lagos. While enjoying a lavish stay at the resort, guests

who gain weight can also lose it by engaging in one of the numerous sports and fitness offerings including; lawn tennis, basketball, football at the mini stadium, which also hosts concerts, while children get busy as well at the wellequipped children playground. As patronage swells, the resort has some pipeline projects to carter to the growing demands. Work is ongoing at the 6,000 guests capacity civic centre, the Olympic size swimming pool is nearing completion, while works is also ongoing at the indoor spa centre offering service including manicure and pedicure. It is exciting moving around the resort vicinity and walking across streets named after some Yoruba towns such as Abeokuta, Ijebu, among others. However, the promoters of the resort seek to boost the economy of Ile-Ife, empower the people and use the resort to spotlight the ancient town on the world map by luring global tourists to the many attractions that abound in the town. Moreover, to heighten their experience at the resort, guests are urged to play with the monkeys, see the alligators or play local games at the African Village. The resort is promoted by Oba Enitan Adeyeye Ogunwusi, Ojaja II, the Ooni of Ife, and is set to rival offerings at Inagbe Grand Resort, in-between Lagos Lagoon and the Atlantic Ocean; also the brainchild of the Ooni.

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

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

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

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

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

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

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

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NEWS

Adequate technology adoption will check poor forecast, risks in oil industry - Seplat SEGUN ADAMS

xecutive operations director at Seplat Petroleum Development Company plc, Effiong Okon, says the right adoption of contemporary technologies like Artificial Intelligence (AI), big data and mobile technology will not only drive planning and forecast in the Nigerian oil industry, but will help in addressing like risks associated with the business. The Seplat EOD said this at the 43rd Society of Petroleum Engineers (SPE) Nigeria Annual International Conference and Exhibition held in Lagos recently, with the theme: Artificial Intelligence, Big Data and Mobile Technology: Changing the Future of the Energy Industry. While delivering a presentation titled, Transforming Big Data and Technology to Business Value: Challenges and Strategic Options during a panel session, Okon said leveraging cloud computing and big data, for instance, promotes accurate forecast of oil production for planning, which in turn drives operational excel-

lence (production optimisation and asset performance). The use of predictive and data-driven maintenance for production and cost efficiency, according to Okon, has helped to reduce Mean Time To Repair (MTTR), and increase Mean Time Before Failure (MTBF) in the industry. For drilling, operators can get predictive analysis through smart drilling; guarantee early identification of drilling anomalies, hazards to well control problems; develop more Enhanced Oil Recovery (EOR) techniques; and real time data through Logging While Drilling (LWD) and Measurement While Drilling (MWD), the Seplat executive noted. He added that in the area of exploration and appraisal, technology had made it possible to obtain big data from sensors attached to equipment used during exploration/appraisal activities (seismic, wells), which will further help in improving subsurface mapping and new well delivery performance through micro-seismic 3D imaging.

Narrating the Seplat technology story, he said the company had continued to make conscious efforts to drive operations using contemporary technologies, with the right investments. According to him, Seplat’s investments in technologies are driven by measurable and justifiable value accruable to the company. He added: “With the right technology, we can identify rock and fluid properties through Magnetic Resonance Imaging (MRI); locate new oil fields through Wide azimuth towed streamer (WATS) Acquisition; and analyse big data through Ground Penetrating Radar (GPR) for cost efficiency. “It also applies to oil/gas transportation while connecting pipelines, sensors, leak detection, alarms and emergency shutdowns; using drone technology for pipeline surveillance. “Internet of Things (IoT) is revolutionising midstream pipeline operations through Supervisory Control and Data Acquisition (SCADA) -based applications

‘Private sector investment will bridge power sector technical skill gap’ KELECHI EWUZIE

ndustry experts insist that continuous investment by private sector in capacity development in power sector value chain is the best solution for Nigeria, if she hopes to address the technical manpower shortfall. Abdallah Khamis, managing director, Zola Electric Nigeria, says private sector involvement in impacting requisite technical skills set to technicians will provide the needed opportunity for them to be equipped with globally recognised certifications. Khamis, while speaking at the closing ceremony at a two-day special training organised for 60 technicians on the installation of Zola Flex System in Lagos, says the training is aimed at providing a pool of well-trained technicians that would not only assist in offering after-sale services to customers on the product but also help to bridge the technical skill gap in Nigeria. While speaking on the benefits, Khamis reveals that the programme has provided the necessary foundation for par-

ticipants to develop a career in renewable energy sector. Ac c o rd i n g t o K ha m i s, “There are numerous benefits that are attached to this training. One of them is the opportunity for the trainees to update their skills and see whether they can pursue a career in renewable energy sector. Apart from that, both the State and Federal Governments can also tap into this opportunity by partnering with Zola Electric Nigeria to train the army of youths who are less engaged. By so doing, we can help create jobs for them.” Olumide Ajayi, head, technical operations, Zola Electric Nigeria, says the curriculum has been designed to cover a wide range of areas that include operations of solar energy systems, installations, and troubleshooting/ faults resolution and efficiency applications. “We believe that training technicians on the installation of this product will complement our superior product quality. That is why we have taken skill enhance-

ment as an important part of our service delivery,” Ajayi states. He further discloses that the resource persons for the training programme were drawn from the pool of highly experienced professionals from Zola Electric, who are well skilled and respected in the art of installation of power system globally. “In addition to the free technical training, the trainees would also be equipped with free certified world class personal protective equipment (PPE). With this in place, it thus means the trainees are in compliance with global HSE best practices,” he states. He therefore expresses the willingness on the part of Zola Electric Nigeria to collaborate with both the state and Federal Government on the programme, stating that such partnership will help facilitate both direct and indirect jobs for the populace. He notes that it was gratifying to note that the training has started yielding fruits as some of the participants are now being engaged on various projects which have made them self-reliant.

Obaseki, institute of taxation fine-tune strategy to widen tax net

do State governor, G odwin Obaseki, says the state government will partner the Chartered Institute of Taxation of Nigeria (CITN) to drive advocacy campaigns so as to widen the tax net in the state. Governor Obaseki said this during a courtesy call by members of the Benin District Society of the CITN, at Government House in Benin City. The collaboration will help the state deepen advocacy programmes to sensitise members of the public on their civic responsibility as regards taxation, he said. The governor noted that the state needed to expand its tax net so it could sustain its

developmental strides, adding that focus in the past was corporate organisations while neglecting about 70 percent of the employed labour force and those who operate small and medium enterprises (SMEs) in the state. “Government relies on the economic activities of its citizens for sustenance. This is done through taxation. We need to emphasise the need for citizens to develop a habit of paying tax. We also need to tweak the system so that owners of SMEs will be conscious of the fact that they need to pay taxes,” he said. The governor also noted that people who earn more in the society should pay more taxes, while urging political www.businessday.ng

leaders to pay stipulated taxes based on their income. He assured members of the institute of government’s support and promised that the state would allocate a parcel of land for the institute to build its Benin Secretariat. Earlier, the president of the institute, Gladys Olajumoke Simplice, commended the performance of the Obaseki-led administration in setting-up industrial clusters in the state to encourage production. She noted that the institute was ready to partner the state in its initiative to improve revenue collection, urging the state to support some of its programmes, which included exchange programmes and study tours. https://www.facebook.com/businessdayng

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Friday 09 August 2019

BUSINESS DAY

NEWS

Hot money to emerging markets slides 41% as trade tantrum takes toll

2020 National Sports Festival: Edo tasks LOC on world-class outing

overnor Godwin Obaseki of Edo State has tasked members of the Local Organising Committee (LOC) of the 2020 National Sports Festival (NSF) to work towards ensuring the 2020 edition of the sports fiesta holding in the state is of world-class standard. The governor gave the charge at the inauguration of the LOC for the 20th edition of the National Sports Festival scheduled to hold between March 20 and April 20, 2020, in the state. He urged the committee to use the opportunity provided by the games to attract sponsors that would invest in the event, as the state prepares to host about 15,000 athletes and team officials. Noting that the festival is big enough to attract sponsorship from private corporations, he said, “We are appealing to private corporations within and outside the country to leverage on the games for the promotion of their goods and services, undertake Corporate Social Responsibility (CSR) initiatives

and give back to the society.” The state is hosting the sports festival to serve as a catalyst for youth engagement, boost the local economy of the state, fast-track infrastructural development, and reposition the state as a tourism destination, he said. The state is committed to organising a world-class competition, which informed the selection of persons with integrity and experience to serve as members of the LOC. He urged the committee members to put in hard work, commitment and dedication in executing the task ahead. Chairman of the committee and deputy governor, Philip Shaibu, assured of the readiness of the committee members to serve the state. The deputy governor, who was represented by chairman of the Edo State Sports Commission, Godwin Dudu-Orumen, thanked the governor for entrusting them with the task, adding, “With the collaboration of the persons that will serve as members of the LOC, we believe all challenges would be overcome.”

Israel Odubola

m e rg i ng ma rke t s (EMs) are feeling the backlash of dampened investor sentiment amid lingering trade crisis between United States and China as hot money to EMs dipped nearly by half in July. Since the trade crisis escalated last Thursday (August 1), $6.8 billion in hot money has left EMs, according to Washington-based Institute of International Finance (IIF), with reversal of capital flows being broad-based. Figures from IIF showed that capital worth $24.3 billion made its way into EMs in July, 41 percent lower compared with $40.9 billion recorded in June. “Arguably the biggest reason for the pullback in EM assets, especially equities, has been due to the trade spat,” said Emmanuel Noko, economist at M&C Research

… loses $6.8bn in 4 days Institute. “What is happening is that investors are pulling funds out of risk assets to riskless assets, causing more woes for EMs,” Noko added. Hot money or portfolio investment is the entry of funds into a country where foreigners deposit money in a country’s bank or make purchases in the country’s stock and bond markets, sometimes for speculation. Stocks suffered the worst hit as equity flows to EMs plunged some 91 percent to $1.2 billion in July, even as debt flows were down some 19 percent. The fact that EM stocks and bonds attracted positive but relatively modest, non-resident flows in July reflects foreign investors’ expectation of a dovish shift from United States’ Fed prior

to its July meeting, but the impact of a loosening stance was outweighed by the ongoing trade dispute, analysts at IIF said. The dynamics of flows sharply contrasted between equity and debt. While Chinese stocks saw an inflow of $2.7 billion, dampened global demand and weaker industrial output saw an outflow of $1.5 billion from non-China EMs. A quick check on Morgan Stanley Capital International (MSCI) EM index, a gauge of equity market performance, showed stocks are headed to their lowest level in seven months, after trade tension between the world’s two economic powerhouses took another dimension. Debt flows were $23.1 billion last month, $5.1 billion less than $28.2 billion

attracted in June. Bond flows have also weakened across EM albeit at slower pace than equities, with South Africa leading the pack of net outflows with over $600 million in the previous week. Moreover, weak growth forecast and issues with its state-owned electricity company (Eskom), which continue to threaten debt sustainability dampen investor sentiment on Africa’s second-largest economy. Despite a sharp outflow cycle suffered in India, which saw foreign investors pull out capital worth $1.7 billion, flows to EM Asia stood positive at $3.6 billion. The distribution of debt flows into EMs was broadly shared, with strong inflows to EM Asia ($13.1bn), Africa and Middle East ($2.1bn), among others.

Fidelity Bank disburses N17.9bn to SMEs

… as Lagos intensifies partnership with lenders HOPE MOSES-ASHIKE

s part of its contribution towards the growth of the economy, Fidelity Bank plc has disbursed about N17.9 billion to Nigeria’s Small and Medium Enterprises (SMEs). A breakdown of the development fund, disbursed at single digit interest rate, includes N2.3 billion from the Central Bank of Nigeria’s (CBN) Micro Small and Medium Enterprise Development Fund (MSMEDF), N9.6 billion from the Development Bank of Nigeria (DBN) and N6 billion from the Bank of Industry (BoI). Regarding the beneficiaries, Nnamdi Okonkwo, managing director/CEO of the bank, said the numbers were in hundreds, saying, “I think what is important is that a bank is willing to make sure it supports more businesses. “We do not despise small beginnings and that is why today we have testimonies of companies that started small and they are big now.” In his opening remarks at the Fidelity SME Funding event in Lagos on Wednesday, he said, “We don’t just lend money. We train, we develop, we handhold and that is why we have a unit called managed SMEs headed by a general manager. That is how seriously we take SME and that is why we put this thing together.” Speaking at the event, Obafemi Hamzat, deputy governor, Lagos State, said in the past four years, Lagos State had given loans to 10,529 SMEs, about 4,800 had been

trained and about 95,000 jobs were created from Lagos State Employment Trust Fund (LSETF). Hamzat explained that a lot of businesses collapse not because they do not have fund, but because they mismanaged the fund, so, training was also done so they could understand bookkeeping. The essence is to grow SMEs, give them access to funding, let them understand how to do the businesses better, how to satisfy their customers and therefore be able to create jobs, he said. Ernest Ebi, chairman of Fidelity Bank, said, “The importance of SME in any economy, not just in Nigeria, cannot be overemphasised because of catalytic role it plays in employment generation and also stimulating the economy. “So, what we are doing here today is a very significant event to sensitise people on the importance of SME, to bring the entrepreneurs close to the funding partners.” Speaking further, he said, “This would have been a tripod where we have the SMEs, the funding institutions and the government so that a conversation will revolve around what each party is expected to bring to the table. “We talked about the funding; we also need to look at creating an enabling environment by the government, providing ease of doing business. Infrastructure is also a big problem because a lot of cost that goes to power, roads and all that is also something that could have been plough back to capitalise the business.”

L-R: Folake Soetan, chief operating officer, Ikeja Electric; Chantelle Abdul, MD/CEO, Mojec International; Ralialan Alabi Yunusa, Baale of Bariga, representing Habib Kazeem Basua Odu 1, Oba of Shomolu, at the Ikeja Electric customer engagement and sensitisation in Lagos, yesterday. Pic by Pius Okeosisi

Atiku behind #Revolution now - APC James Kwen, Abuja

uling All Progressives Congress (APC) has alleged that Atiku Abubakar, the presidential candidate of People’s Democratic Party (PDP), as the patron of #Revolution now championed by Omoyele Sowore. APC called on Nigerians to reject the toxic messages and criminal antics of some individuals and partisans who have embarked on a campaign of calumny against the government and are calling for a forceful takeover of government, describing them as cowards and enemies of Nigeria. Lanre Issa-Onilu, APC national publicity secretary, in a statement released Thursday

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night, said the recent arrest of Sowore by the Department of State Services (DSS) must be seen as a legal and timely action by security services to protect the nation’s democracy and protect the country and its citizens against any action that threatens its collective peace and safety. “Predictably, some desperate individuals, sore losers, and their sympathisers are acting in vain trying to pull a wool over the eyes of Nigerians. Of course, the disgruntled presidential candidate of the People’s Democratic Party (PDP), Alh. Atiku Abubakar is expectedly the patron and cheerleader of the unpatriotic elements who would rather bring our country down for

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being rejected at the polls,” he wrote. Issa-Onilu declared that the desperate attempt by those who wished to politicise a legitimate action by the security agencies, and the futile effort to spread falsehood to create chaos in the country, were clearly irresponsible actions. He called on Nigerians to look at the issue of Sowore’s arrest dispassionately, devoid of the skewed narratives and sentiments being propagated by these individuals. According to him: “Sowore arrived the country recently and openly threatened a revolution against a constitutionally recognised and legitimate government. Should the DSS and other security services have @Businessdayng

dismissed the declaration and the underlying implications as a non- issue? No intelligence/ security agency worth its calling takes issues like this with levity?” he queried. “From elections to governance and general conduct, the President Muhammadu Buhari-led administration has demonstrated its adherence and defence of the rule of law over politics and sundry interests. “Again, on the safety of Nigerians, the current government has been decisive in addressing any action that threatens the country’s unity, peace and our democracy. Sowore’s arrest is another testament to our unshaken resolve in this regard.

Friday 09 August 2019

BUSINESS DAY

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Friday 09 August 2019

BUSINESS DAY

FINANCIAL TIMES

World Business Newspaper

RICHARD HENDERSON IN NEW YORK

omputer-driven investment strategies that automatically sell when market turbulence erupts have exacerbated this week’s swings, offloading up to tens of billions of dollars’ worth of US shares, according to analysts. So-called “volatility-targeting” funds that manage about $400bn in assets have bought up stocks this year as markets have calmed since markets’ dramatic end to 2018. But the renewed turmoil means they were pegged to sell $50bn by the end of Wednesday, according to Wells Fargo estimates. “When volatility jumps, systematic funds rebalance portfolios away from risky assets like equities,” said Pravit Chintawongvanich, an equity derivatives strategist for Wells Fargo. Automated, volatility-sensitive trading strategies have become a popular bogeyman in recent years, with many analysts and fund managers blaming them for exacerbating market swings. The renewed spurt of automated selling comes during a crucial period for the US stock market as it responds to slowing growth, fresh tariffs on Chinese goods and a tepid market response to last week’s interest rate cuts. There are several different types of funds and trading strategies that target a certain level of volatility, and therefore ratchet their equity exposure up and down according to the strength of market fluctuations. They mostly use liquid

Automated selling has exacerbated US market swings, say analysts Surge in computer-driven strategies comes at crucial time for stock market

financial products such as futures and exchange traded funds. Volatility targeting funds, or managed volatility funds, are primarily managed by insurance companies as part of their variable annuity products. They are often grouped alongside other systematic, volatility-sensitive investment

strategies such as trend-following hedge funds and so-called “risk parity” funds, although these tend to move more slowly. To g e th e r, th e y re pre s e nt about $1tn in assets that can have a big impact on market booms and busts, according to some analysts. Monday’s 3 per

cent drop for the S&P 500 — the worst day this year for the share market — was exacerbated by a group of these funds responding to the sell-off last week, traders and analysts said. “Systematic flows were a large proportion of the market activity on Monday,” said Michael Lewis,

head of US equity cash trading for Barclays. “When you see the stock market grind lower, that indicates systematic, quantitative selling, which is likely what we saw on Monday.” Mr Lewis pointed to the heightened trading volume in ETFs, which are popular investment vehicles for systematic funds to gain exposure to the US stock market. ETFs accounted for about 37 per cent of trading volume for the stock market on Monday, up from about 28 per cent for a typical trading day, according to Barclays data. Volatility-targeting strategies have loaded up on US stocks as volatility has edged lower this year. The CBOE Vix index, known as Wall Street’s “fear gauge” dropped from 23 points at the start of the year to 12 by mid-July. The recent bout of selling pushed the index back up to 23 by Wednesday evening, a level that would trigger sustained selling by the volatility targeting funds, said Parag Thatte, a strategist at Deutsche Bank. “What we’re seeing over the last two or three weeks is a disconnection between systematic funds that increased their exposure to stocks and discretionary funds that have cut back,” said Mr Thatte.

WeWork revamp creates tax benefit for company insiders Portugal lures foreigners with tax breaks and anti-populist stance Immigrants and residents see nation as haven from populism and division

Office space provider turns to complex ‘Up-C’ structure ahead of planned IPO ERIC PLATT AND JAMES FONTANELLAKHAN IN NEW YORK AND MILES KRUPPA IN SAN FRANCISCO

eWork has turned to a complex corporate structure for its initial public offering that would give tax benefits to cofounder Adam Neumann and early investors in the office space provider, according to documents seen by the Financial Times and people with knowledge of the matter. The arrangement, known as an umbrella partnership corporation (Up-C), has grown in popularity this decade. Since 2010, at least 74 Up-Cs have gone public in the US, including website provider GoDaddy, burger chain Shake Shack and bond trading platform Tradeweb, according to Dealogic data and US securities filings. WeWork prepared for the manoeuvre last month by changing from a corporation to a limited liability company, called the We Company MC LLC. The public offer would give investors a chance to buy shares in a separate holding company that would own a stake in the underlying LLC. Any profits would be split between the holding company and the LLC partners. Mr Neumann, WeWork’s chief

executive, is expected to have a majority of the voting rights in the holding company, but he and some other early investors would hold their economic interests as partners in the underlying LLC, people with knowledge of the matter said. As a result, Mr Neumann and other insiders would pay taxes on their share of any profits at individual income tax rates. IPO investors, by contrast, would be subject to the so-called double taxation of US corporate profits, under which the holding company would be taxed on its income and shareholders would then be taxed on any dividends. The tax benefits of the Up-C structure have been reduced by the cut in the corporate tax rate under President Donald Trump’s 2017 tax changes. But an analysis by the law firm Simpson Thacher found that the arrangement would lower the taxes on the income going to an LLC partner in an Up-C — relative to a shareholder receiving dividends — by 7 percentage points. “The Up-C structure is a way for owners and pre-IPO investors to create tax savings in the public company that are not fully shared with the public shareholders,” said Robert Seber, a partner at the law firm Vinson & Elkins. www.businessday.ng

PETER WISE IN LISBON

duardo Migliorelli decided to move his family to Portugal the evening he discovered he could walk the few hundred metres from a restaurant to his hotel without fear of being attacked. “I wouldn’t dream of doing it back home,” said the Brazilian businessman, who was robbed and assaulted several times while living in São Paulo. “In Lisbon, you don’t have to keep looking over your shoulder.” Portugal’s crime rate, the lowest in the EU, has been an important factor in attracting tens of thousands of recent immigrants from Brazil, which has one of the highest murder rates in the world, observers say. They are joining a growing number of investors drawn to Portugal from across the world by what they see as an open attitude towards foreigners and a society viewed as largely free of divisions driven by populism, nationalism and anti-immigrant sentiment. In an era of increasingly discordant politics, the country’s perceived social peace is seen as a competitive advantage on a par with its business environment,

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skilled workforce and attractive quality of life, say analysts. According to Florbela Lima, a partner at accountancy firm EY Portugal, “political stability and social peace” are among the most important criteria for investors at a time of uncertainty caused by USChina trade tensions and Brexit. In the company’s recent attractiveness survey on Portugal, she said “the main decision-making factors for investment were quality of life and stability of the social climate”. While Portugal fell one place to 34th position in the World Economic Forum’s Global Competitiveness Report for 2018, it moved up two places in the Global Peace Index 2019 to rank as the third most peaceful country in the world after Iceland and New Zealand. With a low birth rate and declining population, Portugal needs immigrants if it is to sustain a growth rate above the eurozone average, as it has for the past two years. António Costa, prime minister, has said immigration is essential to combat the country’s demographic crisis, calling in a recent speech for Europe to “mobilise against populism and xenophobia”. To attract potential foreign investors, Portugal runs a residence scheme that offers tax breaks to @Businessdayng

skilled professionals, while nonEU citizens who spend more than €500,000 on a property or create sufficient jobs can apply for a “golden visa” — a controversial system the EU has urged governments to tighten up. Last year — the third straight year of strong growth — the number of foreign residents registered in Portugal increased by more than 93,000 to a record of almost half a million. Meanwhile, greenfield foreign direct investment projects were valued at close to £3bn in 2018, the highest level in almost a decade. Between 2015 and 2018, the annual number of such projects rose 161 per cent, by far the fastest growth rate in western Europe. “Portugal is the most open, tolerant and liberal society I have ever lived in,” said Chitra Stern, a Singaporean of Indian descent who moved to the Algarve in the south of the country in 2001 to look for business opportunities. Ms Stern, a British citizen, and her Swiss husband have since built a chain of family hotels and resorts in Lisbon and the Algarve. “People need to feel welcome, especially in today’s world, and the Portuguese welcome people of different religions, beliefs and colours with open arms,” she said.

Friday 09 August 2019

BUSINESS DAY

NATIONAL NEWS

HSBC sticks by US strategy despite missing targets When the bank announced the exit of chief John Flint, it also dropped its US profit goal ROBERT ARMSTRONG IN NEW YORK

SBC’s efforts to build a strong franchise in the US — long a priority of the London-based, Asia-focused bank — have again come up short of its own expectations. But the outgoing head of the US operation insists that, despite years of struggle, it has no plans to withdraw from any of its US businesses or to reduce its investment in the country. While the bank abandoned its 2020 US profit goal this week, that was “in no way an abandonment of the strategy”, Patrick Burke told the Financial Times. “We are facing headwinds from the interest rate environment and market conditions [but] we are committed to the strategy. We think it’s going in the right direction.” That strategy has focused on winning business from companies and consumers with strong international links. “We don’t see anybody in the market who has our model,” Mr Burke said. But analysts are split on whether the turnround will gain traction. The abrupt departure of John Flint, HSBC’s global chief executive, announced with half-year results on Monday, captured headlines. But lower down in the same statement was the news that the bank’s US unit would not hit its target of a 6 per cent return on tangible equity (ROTE) in 2020 — a goal the company set as part of a strategic update just a year ago. Relative to its peers’ results, the target looked modest. HSBC’s US operation, which encompasses commercial, investment, and retail banking, has over $300bn in assets, enough to make it one of the 20 biggest banks in America. Many of those others boast returns in the low double digits. But the 2020 target was ambitious in the context of the US operation’s 2018 ROTE, which was just 2.7 per cent. Analysts have speculated that a change in US strategy might be in the works after the company announced changes to its American management team last month. Mr Burke, 57, chief executive of HSBC USA since 2014, will retire in October and be replaced by an outsider, Michael Roberts, who previously led Citigroup’s global corporate bank. The company has also announced that Kavita Mahtani, another Citi veteran, would assume the role of chief financial officer of the US unit. Mr Burke was emphatic that while the leadership team was changing and market conditions have changed, the strategy and its justification have not. He said that true returns of the US business were not fully

captured by standard metrics, because big US customers also generate revenue for the bank in other regions. It would be impossible to win international business from those clients without serving them in the US as well, he said. HSBC North America’s efficiency ratio — its costs as a proportion of its revenues — remains over 80 per cent, very high by industr y standards. But, Mr Burke argued, operating efficiency would come with higher revenues, and the bank was finally in a position to grow. As recently as 2017, the emphasis in the US unit was putting its regulatory troubles behind it. A money-laundering scandal earlier in the decade, culminating in $1.9bn of fines in 2012, as well as smaller run-ins with the authorities in foreign-exchange trading and mortgages, kept the team focused on updating governance and controls rather than expansion. These regulatory tangles followed a painful financial crisis for HSBC in the US. The bank bought subprime lender Household International for $14bn in 2003, and ultimately wrote down the entire purchase price, and more. Mr Burke pointed to HSBC’s increased marketing investment at the US retail bank as an engine of growth. The US was “the most international country in the world by far”, he said, and the retail bank was going after customers who were born elsewhere and have economic links back home. Loans at the retail operation grew by 8 per cent in the second quarter from the year before, but deposits fell. The division operates at a loss. Wall Street analysts were split on whether persistence in the US makes sense for HSBC. “This is a business that has been unprofitable since the crisis — different strategy, different management, I am not sure that it will make a huge difference,” said Ed Firth of Keefe, Bruyette & Woods. “I don’t see the competitive advantage in the US . . . Why does HSBC have to [have a big operation] in the US to give access to global markets to US clients?” he asked, suggesting that those clients could be served from other global hubs. Magdalena Stoklosa of Morgan Stanley disagreed. “I buy into the strategy — I just think they have given themselves too little time,” she said, welcoming the incoming management team. “The objective is to steady the ship and scale the commercial bank . . . but by dropping the target they have opened the door to rethinking the execution of the strategy.” www.businessday.ng

Boris Johnson eyes election in ‘days after’ Brexit

Sterling hits 2-year low after officials reveal poll timing if PM loses no-confidence vote SEBASTIAN PAYNE AND SARAH PROVAN IN LONDON

oris Johnson would hold a general election in the “days after” the UK has left the EU on October 31 if he is forced to go the polls following a successful parliamentary no-confidence vote in his government, senior aides to the prime minister have said. The news hit the pound, with the currency falling to a twoyear low against the euro in midafternoon trade in London and weakening against the US dollar. Sterling slid to as low as €1.0794, the lowest level since August 2017, before drawing back to €1.0815. Against the dollar it dropped to $1.2094 and then recovered to trade 0.1 per cent lower at $1.2120. Mr Johnson has said he does not want to hold an election before Brexit, but his advisers expect he will face a confidence vote soon after parliament returns from its summer break. Senior figures in the Labour party have said they are planning to try and topple his government in early September.

“We can’t stop them forcing an election but we control the timetable so we will force the date after October 31,” said a senior 10 Downing Street official. “If there must be a general election, then it will be days after October 31.” Another close aide to Mr Johnson did not deny that any election would be held in the first few days of November. Mr Johnson has insisted that the UK will leave the EU at the end of October, with or without a withdrawal agreement. His team, led by senior adviser Dominic Cummings, believe that if an election is called, MPs will be unable to halt Brexit. This raises the prospect of an election in the days straight after leaving without a deal. Since 1935, British elections have been held on Thursdays but this is an unwritten convention. The date is de facto decided by the prime minister. The Spectator reported that Friday, November 1 — the day after Brexit — is being considered by Mr Johnson as the most opportune moment for an election if he is forced to go to the polls. Holding an election straight

after Brexit day is seen by some in the party as a risk, but potentially a necessary one to maximise the Tory vote. One official at Conservative HQ said: “It would be the only way to neuter the Brexit party. We can only go to the country once we’ve actually delivered Brexit.” Others in the party think that the calculation by Mr Johnson and Mr Cummings is that any disruption resulting from a no-deal Brexit would not be apparent by polling day, or would be less harmful than some have predicted. “By undercutting the party chairman with people who answer straight to him, it’s clear Dom is planning to call an election straight after Brexit day,” said one senior Tory MP. “This would be a massive gamble. Even Tony Blair had to delay because of foot-andmouth. Cummings is clearly betting on things going better than Justin King expects.” Mr King, former chief executive of supermarket Sainsbury’s, told the BBC on Wednesday that the UK had 10 days of food stored and “the kind of disruption the government is talking about . . . will lead to gaps on the shelves within a week”.

Italian politicians in fraught talks as coalition spat intensifies Relations between governing partners deteriorate as Salvini ramps up tension HANNAH ROBERTS IN ROME

talian political leaders were plunged into crisis talks on Thursday as mounting tensions within the governing coalition fuelled speculation that the country’s ruling alliance could collapse. Prime minister Giuseppe Conte met President Sergio Mattarella and then saw Matteo Salvini, deputy prime minister and leader of the rightwing League. Relations between the two coalition partners — the League and anti-establishment Five Star move-

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ment — deteriorated on Wednesday after Five Star voted against a motion on the trans-Alpine highspeed rail link with France, a project which is supported by the League. On Thursday Mr Salvini and fellow deputy prime minister Luigi Di Maio cancelled appointments and Mr Conte cancelled a press conference and went to the Quirinale, the president’s office, where he stayed for about an hour. In a statement published on Thursday afternoon, the League said that new elections were “the only alternative to this government”. @Businessdayng

According to the League’s statement, there are “different visions [between 5 Star and the League] on fundamental issues such as public works, infrastructure and development, fiscal shocks, autonomy of the regions, energy, justice and relations with Europe”. The League said: “Italy needs certainty and courageous, shared decisions: it is useless to go on amid delays, blocks and daily fights. Every day that passes is a lost day, for us the only alternative to this government is to give back the decision to the Italians with new elections.”

Friday 09 August 2019

BUSINESS DAY

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Kraft Heinz shares slump on new writedowns and falling sales Warren Buffett-backed food producer still struggling with changing consumer tastes ALISTAIR GRAY IN NEW YORK

raft Heinz, the Warren Bu f f ett- b a cke d f o o d company, has disclosed another $1.2bn of writedowns, on top of the $15bn charge it took earlier this year to reflect how shoppers have been shunning its brands. Its shares fell 13 per cent on Thursday morning, taking the decline for the year to 38 per cent. The company, whose products include Heinz ketchup, Kraft macaroni and cheese and HP Sauce, said on Thursday that first-half profits had halved from a year ago. The Chicago-based group had promised to transform the food industry when it was created in 2015 by the combination of Kraft and Heinz in a deal engineered by the investment firm 3G Capital and Mr Buffett. But it has since become the poster child for struggling consumer goods companies. Products that had been household staples for generations have gone out of fashion. On top of that, the company is also being investigated by the US Securities and Exchange Commission over its bookkeeping. Kraft Heinz’s new chief executive Miguel Patricio, who is 40 days into the job, said on Thursday: “The level of decline versus previous year is nothing we are proud

of.” Net income in the six months to the end of June fell from $1.76bn a year ago to $852m The latest non-cash charges included a $744m goodwill writedown, which Kraft Heinz said reflected reduced “five-year operating forecasts” for several of its international businesses. The company also booked a $474m charge on intangible assets, citing “a higher discount rate to reflect the markets’ perceived risk in the company’s valuation”. The $15bn writedown earlier this year was due to gloomier prospects for some of its best-known brands, including Kraft and Oscar Mayer meats. Kraft Heinz went on to restate almost three years of earnings after an internal investigation uncovered errors in the way it had accounted for supplier contracts. An internal probe pointed the finger at misconduct by employees in procurement. David Knopf, chief financial officer, said on Thursday that the company was “taking extensive actions” to strengthen internal controls, including over financial reporting. Mr Patricio, who was drafted in from brewer Anheuser-Busch InBev to replace Bernardo Hees, said the company still had a bright long-term future. “Our brands are icons,” he said, noting many of them had been around for over a century.

China’s new renminbi level set to pressure Asia currencies Central bank fixes midpoint for trading band above 7 to the dollar HUDSON LOCKETT IN HONG KONG

hina’s central bank on Thursday set the midpoint for the renminbi’s trading band above seven to the dollar for the first time since the global financial crisis, formalising a policy shift that was first revealed earlier this week towards letting the currency weaken. The level at which the central bank set the target band for the renminbi — at Rmb7.0039 to the dollar, plus or minus 2 per cent — was slightly firmer than expected in a Bloomberg survey of analysts, causing the Chinese currency’s onshore exchange rate to strengthen to Rmb7.0445. But Ken Cheung Kin Tai, Asian foreign exchange strategist at Mizuho Bank, said setting the fix above seven was “official confirmation” by the People’s Bank of China that the currency is entering a new normal trading range, a move that could weigh in the longer term on Asia-Pacific currencies. The weakening of the currency through the seven to the dollar mark, known by traders as “cracking seven”, comes as the Chinese economy is growing at the slowest

rate in three decades at 6.2 per cent. The move could help Beijing ameliorate some of the effects of a worsening trade war with the US, with the softer exchange rate offsetting some of the billions of dollars in tariffs that Washington has slapped on Chinese goods in recent months. The slightly firmer than expected fixed midpoint rate on Thursday boosted most currencies in the region, which have faced downward pressure after the PBoC allowed the currency to breach the seven level during trading on Monday for the first time in 11 years. While the currency traded above 7 on Monday, Thursday was the first time the PBoC set the midpoint above that level. The Korean won was up 0.5 per cent against the dollar, the Australian dollar was 0.4 per cent higher and the Philippine peso was up 0.5 per cent. But in the longer term, the weaker renminbi exchange rate was likely to drive down other Asia-Pacific currencies more than during previous spates of devaluation, analysts said. “Over time, the dollar has become less important for a range of currencies across the region,” said Shaun Roache, chief Asia-Pacific economist at S&P Global Ratings. www.businessday.ng

The benefit changes are part of Deutsche Bank’s ‘cost catalyst’ initiative, according to an email seen by the Financial Times © Charlie Bibby/FT

Deutsche Bank benefit cuts anger overseas staff Lender tightens holiday rules and ends long-service awards for 50,000 employees outside Germany STEPHEN MORRIS IN LONDON AND OLAF STORBECK IN FRANKFURT

eutsche Bank has angered an already nervous overseas workforce by tightening holiday rules and ending long-service awards for its 50,000 staff outside Germany. A ban on carrying forward unused annual leave at the end of the year has been imposed with immediate effect, leaving workers little time to rearrange their holiday plans, while 10, 25 and 40-year service awards will be ditched from October. “Whilst these changes may be disappointing, we can assure you that we remain committed to offering competitive benefits and effective initiatives that support your health and wellbeing, enabling you to be the best you can in your professional lives,” Deutsche’s UK chief executive Tiina Lee and UK head of human resources Rachel Blanshard wrote in an email to staff The policy shift comes at a

fraught time for employees of Germany’s largest lender, with 18,000 jobs set to disappear under one of the most radical investment bank restructurings since the global financial crisis. It rankles particularly because it does not apply to Deutsche’s 41,000 employees in its home market, who can carry forward up to 10 days of holiday into the first three months of the subsequent year and will still receive service awards. “ T h e r e ’s n o l o y a l t y a t Deutsche any more,” said one senior overseas manager. “The cash awards are not massive but are nice to have. Between that and cutting back on carrying over holidays it really hasn’t helped the mood.” The bank’s 10th anniversary award currently stands at £750 in the UK. The benefit changes are part of Deutsche’s “cost catalyst” initiative, according to the email seen by the Financial Times, and will help the bank reduce expenses as accounting rules force companies to build provisions

for holiday entitlements that are carried forward from one fiscal year to the next. Another foreign employee said Deutsche was “getting desperate . . . If this is their big new strategy to turn the bank around this is beyond a joke.” However, one person familiar with the lender’s internal discussions said German employment law made it harder to change employee entitlements in the country retrospectively. Deutsche’s sweeping shakeup announced just over a month ago is well under way. By the end of July, about 900 staff had been fired or given notice. One person briefed on the bank’s next steps said it was planning to step up job cuts significantly by the end of September. Senior staff expect the axe to fall first on jobs in the UK and the US, where flexible employment protection laws and weak unions make it cheaper and easier to fire employees. German trade union Verdi has said it expected the bulk of the job cuts to happen outside of Germany.

Facebook leaves flaw in WhatsApp unresolved for a year Hackers found way to change message content and sender

HANNAH MURPHY IN LAS VEGAS

ybersecurity experts who found a way to hack WhatsApp and manipulate chat messages said on Wednesday that Facebook has failed to address the flaws, a year after the social media network was alerted. Researchers at security software company Check Point said in August last year that they had discovered ways in which a malicious actor could alter messages in WhatsApp, “essentially putting words in [someone’s] mouth”, and also change the

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identity of the sender of content in a group chat. But WhatsApp, which was bought by Facebook in 2014, has failed to resolve the issue, which remains today, Check Point said. Speaking at the Black Hat cyber security conference, Oded Vanunu, head of product vulnerability research at the security company, said Facebook blamed WhatsApp’s flaws on “limitations that can’t be solved due to their structure and architecture”. Facebook declined to comment. Check Point said it had now launched a tool that would allow @Businessdayng

users to carry out the manipulations, in order to raise greater awareness of the issue. “We think this is our obligation to escalate this,” Mr Vanunu said, pointing to WhatsApp’s estimated user base of 1.5bn and the risk that the techniques were used to “spread misinformation from what [would] appear to be trusted sources”. Facebook has begun introducing some restrictions to WhatsApp following mounting concerns over the ease at which the messaging app can be used to spread misinformation and fake news.

Friday 09 August 2019

BUSINESS DAY

ANALYSIS

Russians feel the pain of Vladimir Putin’s regime The police’s violent response to protesters’ demands in Moscow has intensified anger over a flatlining economy HENRY FOY AND MAX SEDDON IN MOSCOW

s pro-democracy protests hit central Moscow this summer, student vlogger Egor Zhukov promoted peaceful resistance to his 100,000 followers on YouTube. Violent clashes on the city’s streets — which have seen armour-clad, helmeted riot police pin down unarmed protesters on stone pavements as their colleagues beat their knees with batons — showed Russia’s security services doling out “political repression”, he said. “Life is a struggle for power,” Mr Zhukov said in a video uploaded last week. “People with no power are fighting to have any at all. People who have any power are fighting for it to be absolute.” A few hours after the video went live, police raided the 21-year-old’s apartment, interrogated him for five hours and dragged him off to court, where a judge sent him to jail facing charges of participating in “mass disturbances”. If convicted, he could spend up to eight years in prison. “They’re picking up random people and offering no explanation of what they did in court. And they send them to jail,” said Sergei Smirnov, editor of Mediazona, an independent news site that covers Russia’s criminal justice system, in

a tweet. “Investigators are taking people hostage with the approval of the country’s political leaders.” Not since 2012, when thousands of Muscovites took to the streets to protest against Vladimir Putin’s return to the presidency, has Russia’s capital seen such a brutal crackdown on demonstrations as that witnessed during the past fortnight. Police trucks packed with young Russians and rows of baton-wielding troops have shown the brute force available to Mr Putin and his willingness to use it. But the continued defiance from the tens of thousands who have taken to the streets this summer has underlined the depth of the disaffection at a 20-year-long regime that has failed to deliver economic growth or rising living standards for much of the past five years. And the dearth of ideas inside his administration to reverse its sliding popularity. Portrayed in foreign capitals as a powerful and belligerent geopolitical actor whose military interventions have given him increased global clout, Mr Putin’s domestic support is foundering — down a third since 2017 — after years of economic malaise that have left average Russians feeling poorer and less confident about their future. Real incomes have fallen for five of the past six years, and are about 10 per cent lower than in 2013.

How to spend it well? It’s harder than you think Our gadgets promise to optimise our every second — but most of us are barely hanging on JO ELLISON

his will be my last column for a while. I’ve got a new job. As of September, I’ll be the editor of How To Spend It, the magazine supplement that accompanies this paper 34 times a year. And so I’m taking a few months’ hiatus. Conceived 25 years ago, when the luxury world was in its infancy, the number of big European fashion brands on Bond Street could be counted on one hand, and in the wake of Big Bang culture, the magazine offered City boys (and girls) a lavishly illustrated advisory in how to splurge their bonus cheques. In the past, some have found it an outré element in an organ that preaches fiscal responsibility. But arriving at the magazine two decades after its first publication, I find the title apposite. Because how do you spend it in an era when our lives have never been so commodified, fetishised and parcelled out? And at a time when we have never been more obsessed with schedules and optimising the value in our days. I own at least half a dozen devices that, when prompted, break down my activities by each hour, minute and waking second. My

Fitbit, for example, tells me I walk an average of 11,700 steps every day and sleep an average of seven hours and two minutes every night. The Mindbody app, meanwhile, notifies me that I burnt a disappointing 246 calories at pilates on Tuesday, and have only attended two exercise classes this month. My Screen Time app offers another sorry story. Last week’s update informed me I spent 36 hours and 14 minutes on my iPhone: 16 hours and 14 minutes of those were social networking; 12 were lost to Instagram. Which is shameful. Especially when I consider that I cooked precisely zero meals. I did, however, spend at least 15 minutes googling pictures of Michelle Pfeiffer, six hours binge-watching new episodes of Netflix’s Queer Eye, two hours writing a column about kindness, and £100 paying someone else to walk my dog. I also whiled away several moments digesting the results of the Decathlon Activity index 2019, a survey of some 7,600 UK adults, which found that 65 per cent of Britons would be open to spending a first date doing sports. And that one in three of us would rather go on a walk than go to the cinema or have a drink to break the ice. www.businessday.ng

The boomers going bust: why elderly bankruptcy is rising in America In 1989, one in five Americans over 75 were in debt. By 2016, almost half were PATTI WALDMEIR

uzan Benge is 73 years old, and every month she lives on just $771 in disability payments, $100 in food stamps and $14 in state low-income subsidy. So when her credit card debt hit $18,000 earlier this year, she felt she had little choice but to join the rising tide of American seniors filing for bankruptcy. The elderly are far more visible in US bankruptcy courts these days than in previous generations. Baby boomers aged 65 and older are racking up far higher levels of debt than their parents, who were raised during the Great Depression, and a growing minority are finding themselves tipping over from desperate financial trouble into bankruptcy. The culprits are vanishing pensions, soaring healthcare costs and tens of thousands of dollars in unpaid student loans for themselves, their children and even their grandchildren. Benge is one of them. In the sparse one-bedroom senior flat where she lives, in a suburb of decaying strip malls and six-lane potholed highways outside Detroit, she sits in the recliner that she bought with her credit card and reflects on how she came to declare herself broke. The recliner is part of the story: the total monthly interest payments on the card that financed it cost more than the chair itself. Despite her advanced age, poor health and low income, she had been given a total credit line of $24,000 on her three credit cards. And since it was there, she spent it — though hardly for nights on the town. Her total credit card debts of $18,000 were built up over nearly 20 years, she says, to finance several moves to escape poor living conditions, including a flat with bed bugs. Her borrowings quickly escalated due to the high interest and service fees charged by the credit card companies. Once she filed for bankruptcy and knew she would be losing the cards, she went on a shop-

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ping spree, but all she bought was toilet paper and dishwashing liquid from the grocery store next door, necessities that she fears she won’t be able to afford without her cards. “I have enough dish soap to last me a year,” she declares mischievously, her bright hazel eyes lighting up her face. The fate of seniors living on the edge was highlighted last year in data from the Consumer Bankruptcy Project, a long-term academic study that has been collating information on US bankruptcy filers since the early 1990s. According to the 2018 report based on the data, entitled “Graying of US Bankruptcy”, one in seven people who file in the US are now aged 65 or older — an almost fivefold increase over just 25 years. In 1991, over-65s made up only 2 per cent of bankruptcy filers, but by 2016 that had risen to more than 12 per cent, says Robert Lawless, one of the authors of the report and a professor at University of Illinois College of Law. (As about 800,000 households filed for bankruptcy that year, this works out as approximately 98,000 families or about 133,000 seniors, since many file jointly as couples, he adds.) Over the same period, elders grew as a percentage of the US adult population too, but only from 17 per cent to 19.3 per cent. “The changes are so great that the broader trend of an ageing US population can explain only a small proportion of what is happening in the bankruptcy courts,” the authors write. The trend is a side effect of several colliding social and economic forces in the US that are making the later years of people such as Benge remarkably stressful. Seniors are living longer and paying ever higher medical costs for the privilege of staying alive; many have little or no company pension and scant personal savings to fall back on. Researchers who have studied the phenomenon say many seniors were raised by parents with a pronounced aversion to borrowing money, especially after retirement. But attitudes to debt have changed in recent decades. @Businessdayng

Credit card debt was almost non-existent in US homes in the 1970s but has climbed steadily since then; credit cards are now easily available and usually accompanied by seemingly attractive interest rates and fees. Benge continued receiving offers for new credit cards even after she filed for bankruptcy and stopped paying off her existing ones. In 1989, only one in five Americans aged 75 or older were in debt; by 2016, almost half were, according to the most recent US Federal Reserve survey of consumer finances. The rise in senior debt comes at a time when the wealth gap between rich and middle-class or poor Americans is at an all-time high, according to a study last year by the Pew Research Center. By 2016, the wealth of upperincome Americans had more than recovered from the post-2008 recession, but the wealth of lowerand middle-income families was at 1989 levels, highlighting the long-term rise in income inequality in the US. As these low- to middle-income families age, many are being pitched into debt-burdened retirement by several structural trends, including the decline of trade unions, with their power to negotiate real wage increases, good pensions and retiree healthcare packages; the disappearance of defined benefit pension schemes; steep healthcare inflation; and a sharp rise in middle-class families helping to pay for children to go to college. “The baby boomer attitude to debt has not turned out to be as frugal as you would think it would be, having parents who lived through the Depression. Partly it’s because they have jobs that don’t keep up with inflation and they might have to have five or six jobs to make ends meet,” says Kevin Leicht, head of the sociology department at the University of Illinois. “And if the company they work for gets rid of defined benefit pensions, then that puts an incredible onus on them, and on top of that [there is] all sorts of easy access to credit.

Friday 09 August 2019

BUSINESS DAY

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Women in Business

BUSINESS DAY Friday 09 August 2019 www.businessday.ng

By Kemi Ajumobi

Bella Disu

Abosede George Ogan

Executive Vice-Chairman, Globacom

Director, Strategy, Funding and Stakeholder Management at Lagos State Employment Trust Fund

ella Disu is a Nigerian business executive, arts enthusiast, and philanthropist with over 14 years of professional experience across industries. In 2004, she joined Globacom, where she currently provides strategic leadership as the Executive Vice Chairman of the foremost multinational telecommunications company operating in Nigeria and Ghana. In her role, she has steered Globacom on a path of sustained competitive advantage through a focus on quality, efficiency, innovation and customer responsiveness. In 2011, she took on the additional role of CEO of Cobblestone Properties and Estates Limited, a leading property development company which has a robust portfolio of residential and commercial properties in Nigeria. With extensive experience in high value contract negotiation and project management, she has successfully constituted and led notable projects such as new customer experience Gloworld outlets and the inauguration of the Alliance Francaise Mike Adenuga Centre by President Emmanuel Macron on July 4, 2018 in Lagos, Nigeria. Disu also serves as a non-executive director on the board of Julius Berger Nigeria Plc, Nigeria’s apex construction company, and as a director at Abumet Plc, a glass and aluminium manufacturing company. As the youngest member on both boards, Bella brings her enthusiasm for innovation and transformation to drive productivity and profitability of both organisations. She holds a B.A in International Relations from the University of Massachusetts, Boston. She is a member of the prestigious Institute of Directors, Nigeria and the Nigerian Institute of Management. She is the chairperson of the Bella Disu Foundation, a non-profit organisation she established to improve the potential of children from lessprivileged backgrounds by providing access to quality education and employment skills. Bella is an avid sponsor of the arts, and in this capacity, a director of the Mike Adenuga Center, she is actively involved in promoting the French and Nigerian cultures through its partnership with Alliance Française.

A music lover, she plays the Piano and Saxophone and for years has been a benefactor of the Musical Society of Nigeria (MUSON) to encourage a better environment for musical learning. She is married with children. Her desire to see the return of the well-illustrated and richly narrated folk-tales she read as a child led her to write a book for children aged 5-7. The book, a folktale that reflects Nigerian culture and characters, will be published this year. On Globacom’s support for the widely televised program CNN African voices, she believes that all Africans need to play their part in building the continent’s future, revealing that the partnership with CNN African Voices had allowed Globacom to extend its impact in a unique way. “Globacom had in the last 16 years supported sports, cultural and entrepreneurial activities across the continent, with the goal of nurturing and showcasing talents and would continue in this trajectory.” She said. On her view about the Nigerian environment as regards doing business, she says it is laudable that the government has initiated moves to ease the process of doing business in Nigeria but the environment can be friendlier. In her words, “The government can do a lot more to ensure that there is a sustainable environment for the private sector to flourish. How? In the telecoms sector, for instance, ensure that there are no delays in the allocation of spectrum licences and eliminate bureaucratic obstacles that affect the way we roll out services and expand our networks.” She said. For Bella, a lot more can be done in terms of how digital innovation is pushed, how the change is driven and the need to be innovative. “I am a firm believer that the world is experiencing rapidly total transformation and if you don’t adapt and move with it, you will get left behind. Globacom is having a route to innovation where we say we are identifying needs and finding ways to proffer solutions by using our platform to deploy artificial intelligence, which will basically emulate what people do.”

bosede is an experienced tri-sector leader with a demonstrated history of working in the non-profit, private and public sectors. Skilled in development communications, Corporate Social Responsibility and Sustainability complemented by strong analytical skills, team building and i nterpersonal skills. She possesses over a decade of development experience following a degree in Political Science/Public Administration and MSc focused in Communication for Innovation & Development from The University of Reading. Back at Bank PHB Intern Reality TV Show, she was a participant and became 2nd runner up. The show sought to raise young entrepreneurs by providing a platform for them to learn, while exhibiting their skills in business. She went ahead to become an Assistant Manager at Knowledge Center Limited, a knowledge management firm involved in consultancies on knowledge management issues of public and private sector. As Program Administrator for ActionAid, she was involved with Support International Partnership against AIDS in Africa (SIPAA) and Strengthen Nigerian Response to HIV/ AIDS (SNR) as Program Administrator for both. The Support to International Partnership against AIDS in Africa (SIPAA) Program was a three year initiative managed by ActionAid Africa and funded by the UK Department for International Development (DFID), as part of the broader DFID support to the International Partnership against AIDS in Africa (IPAA). From 2006-2007, at Regional Focal Point West Africa, Global Youth Action Network, Abosede selected and led a team of 16 National coordinators across West Africa, empowering them with resources, connections and support needed to reduce the spread of HIV/AIDS. She engaged over 1,000 young people using social media tools and advocated stronger support against HIV/AIDS. As Corporate Social Responsibility Officer at Bank PHB, she was part of its programs for implementing its Corporate Social Responsibility (CSR) objectives. BANK PHB initiated a comprehensive response to the plight of public secondary education in Nigeria titled

Bank PHB National Scholars Scheme which integrates a holistic initiative to uplift the standards of education in community structures in the six geo-political zones of the Federation. She was Corporate Social Responsibility Coordinator at First Bank of Nigeria Plc, where she helped to support FBN Holdings process of integrating sustainability into its business operations and activities. She contributed to initiating, planning and implementing the Group’s CSR initiatives. She also ensured the Group has adequate mileage on its Corporate Responsibility and Sustainability initiatives through strategic media engagements. Abosede assisted in intensifying the Group’s partnerships with its business community for mutual benefit. She involved internal stakeholders in the implementation of the Group’s CSR activities through initiatives like the Employee Volunteering Programme. She contributed to the internal and external reporting requirements of the Group, as it relates to its Corporate Responsibility and Sustainability, she ensured adequate monitoring and evaluation of all the Group’s CSR initiatives based on the monitoring framework. She is the Founder of Women in Politics which is a platform that supports and encourages women in politics. She’s also the author, Building a Conscious Career, a book that is truly inspiring in every way. In her opinion, every career woman needs to sit and ask themselves, ‘where do I see myself in X number of years? What are my strengths and weaknesses? What organisations will help me achieve my dreams?” According to her, “Don’t leave building networks to chance, have a plan for your career so when you meet people you know what role those people can play in your career growth”. Abosede believes in the importance of networking. She says “Building networks can be financially rewarding. I got my current role through a friend who had seen my role advertised. The next information you need for your next step is probably already within your network.” She is currently the Director, Strategy, Funding and Stakeholder Management at Lagos State Employment Trust, Fund.

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