BusinessDay 09 Jun 2020

Nigeria’s democracy hangs in the balance with Infectious Diseases Bill

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n a few days, a public hearing on the proposed Infectious Diseases Act originally sponsored by House Speaker Femi Gbajabiamila, will take place. After initially sailing

through two readings, the proposed legislation was stopped dead in its tracks and referred to a public hearing after outcry from civil society organisations (CSOs), journalists and the Ni-

FRONT PAGE EDITORIAL gerian public. The main issues with the bill centred around its plagiarism from a 43 year-old

Singaporean law, its draconian empowerment of the police and unelected officials in violation of the constitution and its lack of congruence with Nigeria’s administrative reality.

This public hearing will be the only opportunity that Nigerians have to deliver feedback on this bill and register their opinions about it on record. It is therefore Continues on page 12

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news you can trust I ** tuesDAY 09 june 2020 I vol. 19, no 580 ISAAC ANYAOGU

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illions of electricity customers are being denied meters, and part of the reason is that the Nigerian Customs Service is extending application of a 35 percent levy introduced by the government on imported meters to components used for meter production, Continues on page 35

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Amidst scarcity, millions of meters rot at Lagos port over 35% levy NERC increases meter cost to reflect naira devaluation

587 of 979 Kano strange deaths linked to COVID-19 – FG TONY AILEMEN, JAMES KWEN, CYNTHIA EGBOBOH, GIFT WADA & GODSGIFT ONYEDINEFU, Abuja

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p to 60 percent of the 979 mysterious deaths reported in Kano State mid April were caused by coroContinues on page 35

Inside

World Bank projects Nigerian economy to shrink by 3.2% in 2020 P. 34

L-R: Tukur Buratai, chief of army staff; President Muhammadu Buhari, and Ibrahim Gambari, chief of staff to the president, during Buratai’s visit to the Presidential Villa in Abuja, yesterday.

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comment is free comment Memo to the new SEC DG, Lamido Yuguda

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Timi Olubiyi

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istinguished Director General of Securities and Exchange Commission (SEC), your appointment by President Muhammadu Buhari as the substantive DG at SEC is a welcome development. I join hands with others to congratulate you and wish you every success in your new role. Lamido Yuguda your experience as an, economist, investment manager, CFA Charter Holder, former Director in Central Bank of Nigeria with over three decades of professional expertise in Nigeria includ-

ing the IMF is commendable.

Therefore, your appointment is a good one for the capital market at this time that we are in a new normal due to COVID19 pandemic, where experience and thorough leadership is required.

Consequently, to rise to the occasion SEC needs to come up with policy responses that will cushion the effect of the COVID-19 on the Nigerian capital market as soon as possible.

Expectedly sir, there is need to promote digital economy at this time and also develop regulatory policies and institutional framework to allow the Nigerian capital market function without hindrances or borders with technological innovations. Further to this, there is need to improve on regulations to further promote remote trading, online submission of reports, virtual meetings, video conferencing, AGMs by proxies among others. In addition, it is expected that there would be need to decisively promote policy responses to curb manipulation and infractions in the capital market. This will stimulate the capital market and deepen market participation at this crucial time also promote economic recovery.

More so, the capital market can provide and drive long term fund sir, it is my believe that you would encourage government and corporate bodies to access the capital market for long term fund needs through the issuance of domestic financial securities and instruments in

the capital market. Furthermore, I will encourage you sir to review current securities regulatory requirements applicable to listed companies and SMEs to that it can reflect current realities and help in the market recovery plan.

The new normal has presented opportunities for robust technology adoption, I enjoin you to fully consider this in your regulatory roles and in the improvement of capital market operations. Especially in the effective use of technology to reduce the unclaimed dividend figure which is hovering around 90 billion.

The major problems associated with the prevalence of this culture of unclaimed dividends are lack of proper identity management, absence of the necessary knowledge, investors having multiple accounts without harmonisation and legacy issues due to deceased investors and the unwillingness of their family to tidy the estate account. Therefore, sufficient technology adoption and investors education are required as measures to reduce the high incidence of this unclaimed dividends in the country.

In addition, SEC can promote collaboration with CBN and other stakeholders in the Nigerian capital market to allow more participation of listed companies in the CBN economic relief which is the Targeted Credit Facility, a stimulus package to support Micro, Small and Medium Enterprises in Nigeria. The Securities and Exchange Commission (SEC) can liaise with CBN to review the qualification guidelines, so that listed companies and the capital

‘

The major problems associated with the prevalence of this culture of unclaimed dividends are lack of proper identity management, absence of the necessary knowledge, investors having multiple accounts without harmonisation and legacy issues due to deceased investors and the unwillingness of their family to tidy the estate account

COVID 19: Once again Nigeria abandons its citizens in South Africa

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s the COVID-19 pandemic spread like wildfire around the world, leaders of several nations instituted emergency efforts to repatriate their citizens from foreign shores. For Nigerians in foreign lands, accustomed to the usual incompetence of their officials, there was a sliver of optimism that the Nigerian government would finally change its ways and respond to the pandemic in a professional manner.

For Nigerians in South Africa harbouring such hopes, it’s been a case of deja vu, they have not only been faced with a familiar feeling of disappointment but an evolving nightmare in a country where xenophobic tensions are still rife. They have been thrown out of their hotels, had to seek refuge from strangers and are close to penury.

After South African Airways abruptly cancelled all return tickets for Nigerians and other nationals in South Africa under a government-mandated lockdown, there was no way out of the country except on repatriation flights. However, while other

African countries, including Angola and even cash-strapped Zimbabwe have been evacuating their citizens from South Africa, the official response from Nigerian government officials in South Africa is that they are unable to assist Nigerian citizens and have no authorisation from the Geoffrey Onyeama-led Ministry of Foreign Affairs.

Rather, the Ministry of Foreign Affairs’ sole focus seems to have been in poorlyhandled repatriation flights from more visible countries such as the United States, the United Kingdom and the United Arab Emirates, in efforts that basically seem like window dressing.

In the same period while the Ministry of Foreign Affairs and the Nigerians in Diaspora Commission (NIDCOM), have remained unresponsive to their citizens stranded in South Africa, Geoffrey Onyeama has penned op-eds in the Nigerian news media while NIDCOM’s chief Abike Dabiri, usually a tireless self-promoter, has maintained a deafening silence.

Nigeria is a country of two-hundred

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million, with a huge diaspora population that remits $23 billion to its economy, a sum that is half of $46 billion the entire continent receives in remittances, so one would expect that its government through the Ministry of Foreign Affairs would do a better job of assisting its citizens in a crisis situation.

However, since the COVID-19 pandemic started, Nigeria has organized very few repatriation flights while countries like South Africa have conducted over thirty flights to repatriate its nationals from places as far flung as Brazil, Vietnam, Argentina, Russia and Australia.

In despair some Nigerians have resorted to panhandling on social media even going as far as asking South African government officials to facilitate their return to their country. As if this isn’t bad enough, certain prejudiced South Africans have upped the ante by openly mocking Nigerians over their helplessness in this situation.

Some have even resorted to threatening a repeat of the xenophobic attacks

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market as a whole can benefit adequately from the facility and also join in the laudable interventions to cushion COVID-19 effects.

That said, fiscal policy palliatives should be considered by SEC as measures to cushion the effect of the pandemic because most of the listed companies on the Nigerian Stock Exchange and SMEs have experienced supply chain disruption and depressing service/investment climate. Formulation of appropriate policies to attract Foreign Direct investment (FDI) and Foreign Portfolio Investors (FPI) are expected as you settle in the office. Because their involvement in Nigeria capital market gives positive significant impact on economic growth In conclusion, fiscal incentives such as a reduction in transaction fees can be considered to attract more capital market participation. The SEC in conjunction with other regulators in capital market can formulate policies and regulatory framework to strengthen investor protection, ensure markets efficiency, fairness, transparency. It is also crucial to increase public awareness on the benefits of the capital market to SMEs in the area of seeking long term funds. Good luck!

Dr. Olubiyi is an Entrepreneurship and Small Business Management expert. He is a prolific investment coach, Chartered Member of the Chartered Institute for Securities & Investment (CISI) and a financial literacy specialist. He can be reached on the twitter handle @drtimiolubiyi and via email: drtimiolubiyi@gmail.com, for any questions, reactions, and comments.

Chubi Eze

that have roiled the relationship between both countries in recent years, with some demagogues threatening to attack Nigerians still in the country after June 16th.

While diplomatic representatives of other nations are regularly seen at Nigerian airports regularly arranging the repatriation of their nationals, the official message from the Nigerian government and its Ministry of Foreign Affairs seems to be that ordinary Nigerians are on their own.

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What is left of the legacies of men? (1) STRATEGY & POLICY

MA JOHNSON

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hy the eleventh commandment should not stand in any civilized society Globally, there are those who say that the law has no place in their lives at all irrespective of their religious beliefs and position in the society. These are popularly referred to as antinomians, which simply means “against the law.” They reject socially established morality by operating outside the law of the land.

Anywhere they are, they do things to please themselves. This category of people wants to satisfy themselves first before any other person. When they are advised to operate within the confines of the law, they simply say“do your worst”. These are the people who want to operate the eleventh commandment- “Please yourself”.

An eminent historian, Paul Johnson, wrote a book “Modern Times” that chronicles the events of the Twentieth Century. He points out that one of the most important events that century was the publication in 1905 of Albert Einstein’s theory of relativity.

Johnson brilliantly notes that ever since the theory of relativity was accepted as fact in the world of physics, others have been trying to make it work in every imaginable discipline including ethics and religion. It has

been one gigantic experiment, testing whether man can live without absolutes. The response according to some scholars is yes, man can live without absolutes, but not very well.

Please, do not misunderstand this writer and think that he is one of those who blame the society’s slide into anarchy and relativism on Albert Einstein. In fact, Albert Einstein drives home his point when he expressed his fear over where this movement will lead us to when he said, “Relativity applied to physics, not ethics.”

Yet for the greater part of the Twentieth Century, people were willing to listen to the voice of a person like Karl Marx, who insisted that man is controlled not by the absolutes of God but by economic factors. Some scholars ignorantly nodded in agreement to Friedrich Nietzsche’s proclamation that “God is dead,” and therefore, the only thing that controls man is the quest for power.

Men also, marvelled at the wisdom of Sigmund Freud, who maintained that man is controlled by sexual desires and not by the laws of God; and Charles Darwin, who vowed that the only law that really matter is the “survival of the fittest.”

What is left of the legacies these men handed over to humanity? The Communist empire that was built on the wisdom of Karl Marx lies in shambles. The theories propagated by Friedrich Nietzsche, Sigmund Freud, Darwin and others have failed woefully. Psychologists and scientists have at one time or the other considered some of these theories archaic.

President Donald Trump’s “America First” will stand if it is rooted in love for humanity. President Buhari’s philosophy of “I belong to everybody and I belong to nobody” will stand the test of time if it was rooted in love for country. We must accept the truth that there is a God who created the universe, just as the Holy Book says.

And the truth is that God’s laws are not relative. They are absolute and immoveable. Any legacy that does not take its root from the Greatest Commandment - “Love your neighbour as yourself,” will fall like a pack of cards.

We are in an age where anything can happen, according to the novelist, Salman Rushdie. Yes, anything can happen. George Floyd, the African American has just been murdered in Minneapolis, USA. There is “rape pandemic” and banditry on a large scale in some parts of Nigeria. Citizens are scared. It has led to peaceful protests.

Innocent citizens are slaughtered in most northern states of Nigeria. But in all these, justice is very scarce.

Salman Rushdie, you may recall went into hiding after a fatwa from Ayatollah of Iran, over his 1988 novel “The Satanic Verses.” Recently, Salman Rushdie warns of American autocracy. In a recent article in Washington Post, he noted intolerant leaders of India and Pakistan. “Extreme narcissism, detachment from reality, a fondness for sycophants and a distrust of truth-tellers, an obsession with how one is publicly portrayed, a hatred of journalists and the temperament of out of control bulldozer: These are some of the characteristics. President Trump is, temporarily a tinpot despot of this type.”

President Donald Trump is not the only leader one can refer to as a tinpot dictator. There are so many of them in other parts of the world particularly in Africa. Trump is on his way to despotism as he tries to polarise public debate, elevating concerns about violence and looting above the message of peaceful protest. He has threatened to use the military against American citizens. A threat one might have expected from any leader in Africa, but certainly not of the United States of America.

Trump has opened the floodgate of reactions from American generals.

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We are in an age where anything can happen, according to the novelist, Salman Rushdie. Yes, anything can happen. George Floyd, the African American has just been murdered in Minneapolis, USA

In fact, one retired Admiral Mike Mullen, former Chairman US Joint Chiefs of Staff under presidents George Bush Jnr and Barrack Obama, has this to say: “I remain confident in the professionalism of our men and women in uniform. They will serve with skill and compassion. They will obey lawful orders. But I am less confident in the soundness of the orders they will be given by this commander in chief, and I am not convinced that the conditions on our streets, as bad as they are, have risen to the level that justifies a heavy reliance on military troops. Certainly, we have not crossed the threshold that will make it appropriate to invoke the provisions of the insurrection Act.” “Even in the midst of the carnage we are witnessing, we must endeavour to see American cities and towns as our homes and neighbourhoods......“ “They are not ‘battle spaces’ to be dominated, and must never become so……Our fellow citizens are not the enemy, and must never become so. This is not the time for stunts. This is the time for leadership,” Mullen continues.

This writer was stunned reading Abubakar Dangiwa Umar’s recent letter to President Buhari titled “Mr President: Please belong to all of us.”

Part of Umar’s letter reads: “Nigeria has become dangerously polarised and risk sliding into crisis on account of your administration’s lopsided appointments which continues to give undue preference to some sections of the country over others. Your skewed appointments into the offices of the Federal Government, favouring some and frustrating others, shall bring ruin and destruction to this nation....” This advice is to enable Mr President polish his leadership style.

It takes a generation of committed leaders to build a nation. Thank you!

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

Parallels between Hong Kong and Nigeria

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ast month, China’s ruling party sent a draft legislation to Hong Kong’s parliament making criminal any act of subversion, including “insulting the Chinese anthem. Protesters have taken to the streets to protest what they see as Chinese interference in the territory. Last year, about a million protesters marched around the island demanding a withdrawal from parliament of a law that would have allowed for criminal suspects to be extradited to China. To understand these protests, it is necessary to do a very brief excursion into history.

In the 18th century, China raked in profits from trading goods around the world. Western powers like Britain decided that in order to compete with China they needed to trade the Chinese something that would turn the tide in their favour. So, they sold opium to the Chinese people which completely turned the balance of trade in the opposite direction. While this new trade was a roaring success for the British, it came at a cost to China because opium got too many people sick, harming China’s economy.

So, in 1814, the Chinese Emperor, Yongyan, banned the sale of opium. In reply, Britain demanded that China pay for drugs that were seized, and the Chinese refused. This sparked the First Opium War as Britain invaded China.

After years of fighting, China surrendered.

One of Britain’s conditions for peace was for China to hand over one of its territories, a small, undeveloped Island called Hong Kong. The Chinese had no problem giving up the island because to them, it was just a pile of rocks. The

British saw differently. Hong Kong has a natural harbour which offered Britain a strong Eastern trade base and a strategic gateway to the Pacific.

When the Second Opium War ended in 1860, Britain gained new territory, the southern portion of the Kowloon Peninsula. This was the first stage of expansion towards the leasing of the new territories in 1898 for 99 years. This 99-year lease gave Britain all the remaining territories of Hong Kong, but with it came an expiration date, 1997.

Fast forward a half century, and after the Second World War, as Britain lost status, China became a communist country. Hong Kong was effectively cut off from China and began to develop in a different, more Western-oriented direction.

Forward another half century, and Hong Kong was handed back to China in 1997, but under a unique agreement - a mini-constitution called the Basic Law and a so-called “one country, two systems” principle, valid until 2047. This came with freedom of assembly and speech, an independent judiciary and some democratic rights - freedoms that no other part of mainland China has. Under the same agreement, Hong Kong was free to enact its own national security law as was intended in Article 23 of the Basic Law. But here is where there is a difference in the interpretation of the “one country, two systems” agreement.

To the British, and the Westernised Hong Kongers, it meant that they’d bought time, 50 years in which they hoped that China would change and become more democratic. To Beiwww.businessday.ng

jing, it meant a gradual erosion of Hong Kong’s Western orientation, such that by 2047, Hong Kong would be fully Chinese. These different interpretations, and especially since Xi Jinping with his less patient style took over the leadership of China from Hu Jintao, are what has led to the current conflict.

China’s latest moves come in the wake of a coronavirus pandemic that has brought much of the world to its knees. After successfully containing the virus which began in one of its own cities, the Chinese government has embarked on a series of confrontations with its perceived adversaries in what can be described as a wolf warrior diplomacy. In trying not to let a good crisis go to waste, China has latched onto the distraction of a West reeling from virtual economic collapse from the virus, in order to reabsorb Hong Kong.

Do I support what the Chinese are doing?

No, but I’m pragmatic enough to understand the following: first, in 1997, Hong Kong was 20 percent of China’s economy. Now it is 3 percent.

Its importance to Beijing now is more symbolic.

More importantly, though, since the current push for a new law came directly from the Central Committee of the Chinese Communist Party, then there is no going back.

I also find it hard not to compare it with my country. Nigeria, sadly, is known for squandering opportunities. The pandemic has afforded us an opportunity to change a lot of things, but the going has been painfully slow. It was only last week that the very wasteful petrol subsidy was finally removed, but yet the PPPRA still

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Cheta Nwanze

remains intact, meaning that the subsidy can be reintroduced when there is money. We have failed to use the economic headwinds to restructure our wasteful budgeting system.

Then there were two critical things we could have done during this pandemic - rigorous testing and contact tracing, which could have strengthened our health system and data gathering capabilities.

In the first regard that Nigeria has failed woefully. Testing as of Friday, 5 June, less than 75,000 samples (not people, it is always important to note the distinction). This translates to less than 1,500 tests per day since our index case. The result is that we can’t plot a trend to confirm if the country is past the peak or not.

Now, reality has caught up with Nigeria, and we can no longer feasibly enforce any lockdown, or fix our health system during such a lockdown.

Nigeria has again, wasted a crisis.

Cheta Nwanze is the lead partner at SBM Intelligence and heads the company’s research desk.

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Assessing CBN’s lending boost policies

Rafiq Raji

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y column this week presents an article I wrote for African Banker magazine in the first quarter of 2020 about the lending boost policies of Nigeria’s central bank. At the time, African countries had not started to implement COVID-instigated lockdowns. With extraordinary measures now in place by most of the continent’s central banks to break the fall of their respective economies owing to the pandemic, the following allows an objective reflection on the state of Nigerian banks without any COVID-related bias.

In early January, the Central Bank of Nigeria (CBN) announced its decision to retain its minimum 65 percent loan deposit ratio (LDR) “in the interim.” It also maintained the “incentive which assigns a weight of 150 percent in respect of lending to SMEs, retail, mortgage and consumer lending”. If a bank fails to meet the minimum LDR on or before March 31, 2020, the CBN would levy an “additional cash reserve requirement of 50 percent of the lending shortfall of the target LDR”.

The CBN has left no one in doubt about its seriousness. In October 2019, it deducted about 500 billion naira from

the accounts of 12 banks for failing to meet the then minimum 60 percent LDR requirement (set in July) by endSeptember 2019. Despite the shortfall by these banks, private credit sector extension increased by about 5 percent over about four months to 16 trillion naira in late September. Having increased the minimum LDR to 65 percent in September with an end-December 2019 deadline for compliance, the central bank deducted another N650 billion from the accounts of non-compliant banks three months later.

So, what are the implications of these policies for the Nigerian banking sector and economy at large?

Minimum LDR requirement is credit negative Moody’s reckons economic growth would remain subdued, forecasting 2.5 percent for 2020; which its reasons is “insufficient to markedly improve living standards.” And while Moody’s highlights the decline of problem loans in Nigeria, it believes they will remain high. One reason why is that a “high proportion of restructured loans mask true levels of problem loans”.

Regardless, Moody’s believes “capital will remain moderate, with most banks taking advantage of a three-year transition for IFRS 9 adoption”; albeit capital would be “stronger at the top-tier banks”, by its reckoning. Furthermore, Moody’s believes “banks’ earnings will be constrained by subdued loan growth and rising costs (IT, investments, AMCON levy, higher staff costs).

On its part, Fitch Ratings has revised its Nigerian banking sector outlook to negative (from stable in 2019), which it asserts “reflects increasing regulatory risks and unorthodox monetary policy.”

More pointedly, Fitch sees the CBN’s minimum LDR of 65 percent weighing on banks’ asset quality and profitability, eroding capitalisation, and reducing liquidity.

Fitch actually sees large banks being the “most affected by the LDR rule because of their smaller loan books relative to assets.” Fitch reckons “forcing banks to lend into priority sectors and within a short timeframe will inevitably increase asset quality vulnerability” and sees a modest rise in the sector’s average impaired loan ratio, albeit it would probably remain below 10 percent in 2020.

Furthermore, Fitch sees risks in the oil & gas and power sectors persisting.

Still, it expects large Nigerian banks to “continue to outperform smaller peers due to franchise strengths and overall good asset-quality metrics.” Besides, Fitch expects all banks to benefit from what are still high lending rates and high yields on government securities, albeit by its reckoning, smaller banks would “be affected by higher funding costs and weaker asset quality.”

When asked about his assessment of the impact thus far of the lending boost policies of the CBN, Mahin Dissanayake, senior director, Europe, the Middle East & Africa (EMEA) banks at Fitch Ratings says that “while we don’t agree with the LDR, it is clear that the CBN’s measures to stimulate bank lending are working.”

“Banks have reluctantly resumed lending, initially increasing exposure to their existing prime customers but given the need to meet the higher LDR hurdle (in a relatively short-time frame) they have started to increase lending in new segments, particularly in retail banking (which most banks avoided in the past)”, adds Fitch’s Dissanayake.

But the loan growth comes with

‘

The CBN has left no one in doubt about its seriousness. In October 2019, it deducted about 500 billion naira from the accounts of 12 banks for failing to meet the then minimum 60 percent LDR requirement (set in July) by endSeptember 2019

An edited version was published in the Q1 2020 issue of African Banker magazine “Dr Raji is chief economist at Macroafricaintel.

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

From the blogs

Alexandra Witze

Universities will never be the same after the coronavirus crisis

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ow virtual classrooms and dire finances could alter academia: the first chapter in a week-long series on science after the pandemic.

The notice went out on 6 March, a Friday afternoon.

All classes at the University of Washington in Seattle — the city then the US epicentre of the outbreak of COVID-19 — would shift online the following Monday. Instructors scrambled to set up remote learning options for more than 40,000 students.

“It became apparent very quickly that this was something that wasn’t going to go away soon,” says Mary Lidstrom, the university’s vice-provost for research.

Similar scenes have played out at other universities around the world.

Lecture halls remain silent, laboratories sit idle or operate with minimal staff and administrators grapple with how to safely resume inperson classes.

The coronavirus crisis is forcing universities to confront long-standing challenges in higher education, such as skyrocketing tuition costs and perceptions of elitism — and some of the resulting changes could be permanent.

Over the long term, universities might shift many classes online (a trend already under way), have fewer international students and even refashion themselves to be more relevant to local and national communities — both to solve pressing problems and to prove their worth at a time when experts and public institutions are coming under increased criticism.

“The pandemic is speeding up changes in a tremendous way,” says Bert van der Zwaan, former rector of Utrecht University in the Netherlands, and author of Higher Education in 2040: A Global Approach (2017).

As universities face major changes, their financial outlook is becoming dire.

Revenues are plummeting as students (particularly international ones) remain home or rethink future plans, and endowment funds implode as stock markets drop.

A deserted view of All Souls College in Oxford after students have been sent home due to COVID-19 concerns.

Like most institutions, the University of Oxford has been unusually quiet since the pandemic spread around the world.

The universities that are likely to fare best are those that are rich and powerful.

But even those face challenges.

The Massachusetts Institute of Technology in Cambridge has been putting courses online for free since 2002, but most academics who were teaching in the current semester still had to scramble to work out how to move their materials online when the pandemic hit, says Sanjay Sarma, the university’s vice-president for open learning.

More broadly, many institutions are learning the hard way that simply delivering course materials through digital platforms is not the best way to teach students.

“Zoom university isn’t proper online learning,” he says.

Sarma hopes that when universities resume in-person classes, the experience will be radically different — with instructors distributing video lectures early, and focusing in-person time on interacting with students to ensure that they understand the concepts being taught.

“We don’t want to waste our proximity on oneway stuff,” he says.

“It has to be two-way learning.”

Some educators expect the pandemic will lead to more and better online teaching than before — in both wealthy countries and those

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with lower incomes.

When universities in Pakistan closed in March, many instructors didn’t have the tools to teach online and many students lacked reliable Internet access at home, says Tariq Banuri, chairman of Pakistan’s Higher Education Commission in Islamabad.

But the commission has been working to standardize online teaching and to get telecommunication companies to offer students cheaper mobile-broadband packages.

“We’re doing this in context of the virus, but we think these actions will have longer-term benefits,” such as producing students who are better trained for technological jobs, says Banuri.

In low- or middle-income countries such as Pakistan, the coronavirus pandemic could force universities to accelerate long-term plans to improve the quality and relevance of their teaching.

All institutions are facing major financial problems, however.

Wealthy private US universities, such as Johns Hopkins University in Baltimore, Maryland, expect to lose hundreds of millions of dollars in the next fiscal year.

UK universities collectively face a shortfall of at least £2.5 billion (US$3 billion) in the next year because of projected drops in student enrolment, according to the UK consulting firm London Economics.

And Australian universities could shed up to 21,000 full-time jobs this year, including 7,000 in research, a government report said in May. An empty lecture hall at Technical University Munich during the coronavirus crisis.

The Technical University of Munich in Germany cancelled in-person classes, and students there are now learning remotely.

One of the biggest problems will be the drop in revenue from international students. Australian

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risks. The minimum LDR requirement “effectively forces banks to lend at a time when operating conditions are not conducive to growth”, Fitch’s Dissanayake says. Consequently, Dissanayake expects “a further, albeit a modest, increase in impaired loans over the next two years as these new loans season”.

“Furthermore, risks in the oil and gas sector and the power sector persist, giving rise to continuing asset quality concerns despite sector impaired loans reducing since 2018”, Fitch’s Dissanayake asserts.

That said, Dissanayake does not expect “a faster deterioration in asset quality as banks have (over the last two/three years) written off, restructured or recovered large amounts of legacy bad loans.”

On his part, Peter Mushangwe, a banking analyst at Moody’s says “although gross loans and advances increased 4 percent by October 2019 from July, when the regulation took effect, loans will need to grow by around N690 billion (about 5 percent of gross loans as of 31 October) to meet the minimum requirement by March 2020.”

“Given Nigeria’s challenging operating environment, meeting the minimum requirement will be credit negative for banks because we expect them to make potentially riskier loans, which will outweigh potential benefits from diversification as they lend to more granular borrowers and reduce their high single-name concentration risk”, Moody’s Mushangwe adds.

universities, which rely heavily on tuition fees paid by students from China, expect to lose Aus$3 billion to $5 billion ($2 billion to $3 billion), mainly in fees from international students, says Andrew Norton, who studies higher-education policy at the Australian National University in Canberra.

The losses will be concentrated at researchintensive universities such as the University of Sydney, he says, because income from international students often subsidises research.

The financial shortfall faced by universities around the world might mean that some, especially the smaller ones, will close permanently, says Jenny J. Lee, a higher-education researcher at the University of Arizona in Tucson.

Others might merge.

And some could develop innovative approaches, such as Arizona’s “microcampus” network.

The programme, which has been developed and expanded over the past few years, pairs the university with an institution abroad so that students can take online classes from Arizona and have a local faculty mentor to meet with in-person.

“With COVID-19 we’re suddenly realising what happens when we are physically shut-off from other countries,” Lee says.

Even after the immediate financial crisis passes, the economic outlook could remain bleak.

Some researchers say that this might drive universities and funding agencies to focus on research projects and infrastructure that are most relevant to national interests in a postpandemic world.

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

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EDITORIAL Publisher/Editor-in-chief

Frank Aigbogun

Nigeria’s democracy hangs in the balance with Infectious Diseases Bill Continued from front page

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

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important that all parties concerned including House members, CSOs, the media and the public understand the issues surrounding this bill and why it cannot pass in its current form if Nigeria is to remain a constitutional democracy in anything but name. What are the problems with the bill and what can be done to fix these problems before passing it?

Solving problems by creating worse problems The big problems with the bill are the fact that it is almost entirely plagiarised from Singapore’s Infectious Diseases Act of 1977, and the fact that its wording effectively turns Nigeria into a police state under the iron fist of the Director-General of Nigeria Centre for Disease Control (NCDC) and the Health Minister.

In clear contravention of the 1999 constitution, the bill empowers the police to arrest anyone at will without warrant using nothing more than their personal discretion. An individual who is suspected of having an infectious disease -- which could be anything from a flu to chicken pox -- can be arrested and detained indefinitely by the police.

Buildings can be expropriated and demolished under nothing but the personal discretion of the NCDC DG, and any affected individuals are not permitted to seek legal recourse, but are mandated to appeal to the unelected Health Minister whose decision is final and cannot be appealed. The NCDC DG is empowered to go after journalists and whistleblowers by making it a legal

offense to withhold any document or information he wishes to obtain from absolutely anyone. Anyone who is familiar with dictatorships will immediately recognise the familiar voice of authoritarianism running through the clauses in this bill. This is not surprising because it is more than 97 percent lifted from the afore-mentioned Singaporean Act which presents its own set of problems.

Singapore, both in 1977 and till date has never been a democracy. Under the iron-fisted albeit relatively competent rule of Lee Kuan Yew, legislation like this was common. Singapore operated under the understanding that human rights were more of a helpful suggestion than a fundamental basis for society. The 2020 World Press Freedom index lists Singapore at number 158, 43 places below Nigeria at 115. This raises the obvious problem: why is a highly populated, multi-ethnic constitutional democracy which has now operated in its current form for 21 unbroken years lifting legislation from an authoritarian island state of just 5.6 million people and only two ethnic groups?

Clearly Singapore and Nigeria have almost nothing in common demographically, economically, culturally and historically. Copying legislation from Singapore without even the slightest attempt to localise and domesticate it has raised this key issue -- the bill makes no mention of the role of local and state governments in the operation of the NCDC. The DG is effectively expected to become Nigeria’s sole health administrator without any input from local or state level, which is nonsensical in Nigeria’s governance context. Of course, Singapore is a tiny island state without state or local government, so such

concepts cannot exist in its legislation -- which then begs the question why Nigerian legislators would ever think that lifting Singaporean legislation in whole and without any attempt at localisation is in any way a good idea.

How to fix the Bill Until recently, the perceived consensus in the global scientific community was that in fighting COVID-19, no measures were too extreme or high handed. WHO DG, Tedros Adhanom, famously remarked some months ago while praising China’s brutal lockdown of the Hubei Province that there is no such thing as an overreaction when dealing with the coronavirus. Apparently Nigeria’s legislative community appears to have taken these messages to heart a bit too much, resulting in potentially disastrous legislation like this which can end up creating a constitutional crisis if passed, with its myriad of clauses that directly contradict the 1999 constitution.

What needs to happen at this point is that whoever is drafting what will replace the current iteration of this bill will go back to the basics of what infectious diseases are and why this bill is being promulgated. In the case of virulent human-to-human pathogens like SARS COV-2 and Ebola, the basic problem is an informational one -- who is carrying it, and how, when and where they get infected? How does the virus attack cells, crack gene codes and replicate itself? To this end, the solution would clearly be an expansion of testing, tracking and isolation capacity -- not a mindless expansion of bureaucratic powers and the inadvertent creation of a police state.

In the case of te COVID-19 out-

break in Nigeria, what problems have been encountered and what lessons have been learned? Rather than rush to push through an ill-considered bill so as to be seen “doing something,” the more considered and impactful approach would be to wait until sufficient data and information is available to be able to sift out what exactly Nigeria’s challenges are in dealing with infectious disease outbreaks. Legislators would need to hear from frontline health workers about their challenges in accessing sufficient PPE, testing kits and other essential supplies. The law would then create a legal framework to ensure that next time, such failures do not repeat themselves.

As against life following law, the law must follow life. Waiting until after this outbreak is over to parse exactly what Nigeria’s challenges are and how to solve them legislatively is the common sense thing to do. There are no prizes for rushing through poorly-worded, dangerous and plagiarised legislation in the heat of the moment just to be seen as an effective political actor. For reference, the NCDC Act of 2018 already provides a legal basis for the existence and operation of the NCDC, and the existing Quarantine Act -- dated as it may be -- has done its job for now. Why the rush to introduce competing legislation that will almost inevitably end up needing a repeal someday?

During the upcoming public hearing, it is important that these points are noted and emphasised so that all parties concerned can properly understand what is at stake and reach the appropriate compromise. Nigeria’s democratic well-being may just depend on it.

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

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Low Insurance Penetration Nigeria: “WAR FOR TALENT” - How in prepared beyond awareness creation are you post COVID-19 Crisis?

BY: TEMITAYO OLANIYAN

Awareness, a term used to describe a state of knowledge and understanding of a situation or phenomenon, is increasingly being linked or proffered as the solution to low insurance penetration in Nigeria. Many consider it the messiah for the sector. But the question remains if only awareness is ever years enough to develop the induswenty-two later, the phrase “War try to afor state its key stakeholders Talent” seem unending desire? and it is about Despite numerous potentialsintensified and vast array to its take an unexpected turn of opportunities for growth, the Nigerian insurwith the emergence of the COVID-19 crisis.

The ance industry has continued to grapple with pandemic has disrupted major business strategies manyshifted challenges that have caused its contribuand several paradigms of work, forcing tion to national Product (GDP) organizations to Gross quicklyDomestic adapt to new realities of to remain low and of course, slowed reliance onabysmally technology, digitalization of work and its development. Top of these challenges is low Home-Based Work (HBW). penetration - one of the metrics (the other being Insurance Density) used to measure the level of The world is of going through an unprecedented development the insurance sector. moment andindustry most organizations areconcerned currently While many watchers and operating in “survival mode” As we can evidently stakeholders have been quick to point accussee theatmicrowave made beenon rolled ing from fingers the low level of policies awareness the out.It is expected that the COVID-19 pandemic benefits of insurance, it is important to note that will forother the first half of the challenges year, and perhaps therelast exist fundamental plaguthe half – Proffering if a second awareness wave shouldcreation indeed ing second the industry. as the However, panacea toafter low COVID-19 insurance penetration occur. has run its can be said to be a cosmetic approach – awarecourse, organizations will need to switch their ness creation alone yields low to impact, thus approach of “survival mode” a “run as the fast necessity of amodel more holistic review of the issues as you can” to close the business and in order to improve the fortunes of the industry. operational gap caused by the pandemic.

This is also a compulsory insurance cover required by law. All buildings with more than 2 floors under construction are to be insured by the owner or the contractor to cover liability against construction risks. Despite the penalty of N250,000 or three years imprisonment or both, enforcement in this regard also has been very weak.

The reality is flagrant disregard for the provision as stated Section 64 of Insurance Act of 2004.

The term “War for Talent” was first introduced in 1997 by Steven Hankin of Mckinsey and Company to describe the changing landscape and complexity in the process of attracting and retaining talent.

T

Nigeria versus otherwill African Let’s face it, things neverclimes go back to the The statistics worrisome and indeed unfor“old normal”, are coupled with recent predictions tunate for the Nigerian insurance industry. With by experts on a new wave of War for Talent, a population of over 200 million and more than organizations will have to leverage onpeople highlyskilled half of that comprising of young who professionals to help do the following: can engage in economic activities, the industry should not be in its current circumstance.

1. solutions to garner what mightgross have ToProffer put things in perspective, withthey a total lost during pandemic. premium ofthe about N400bn (US $1.1bn) in 2018, 2.

Create and that enables compared with deploy nominalstrategies GDP of N129.1trn, the growth. insurance industry was able to contribute only 3.

Fight while to maintain their currentinposition or win 0.31%, its counterparts other climes contributed 16.99% in South Africa; 6.69% in new market share.

Namibia; 4 . D i s c o4.76% v e r nine Lesotho; w o p p o2.83% r t u n iint iKenya; e s w hand ile 2.44% in Swaziland, asstrategies reported by statista.com. translatingbusiness into profitable results.

Thethe Issues In past, talentswere mainly confined to job The Nigerian within Insurance is For surrounded opportunities theirmarket location. instance, byyou fundamental issues chances that demand the attenif live in Nigeria, are, you would tion of all stakeholders.

Interestingly, the issues only be competing with other people with your are not farfetched.

They have all one way or the skills set and, in your locality. However, with other been highlighted as being impediments to the recent increase in Home-Based Work and the sector’s growth. The issues range from low rapid of digital due tolack the capitaladaptation of operators, limitedtechnology human capacity, pandemic, talents will compete across borders. of trust in the sector and lack of enforcement of The job market isclasses becoming fully borderless with the compulsory of insurance. more opportunities for Insurance talents irrespective of Evidently, the National Commission demographics locations.

In issue every (NAICOM), can or begeographical seen to be tackling the crisis, strings of and this of low there capitalare following itsopportunities directive to players in Crisis will be different.increase There is their no doubt the May 2019 to no significantly paid-up job market will be competitive building share capital.

Consequently, Lifehence Insurance underwriting firms with will minimum share relevant competencies be a keypaid-up differentiating capitalfor of top N2 talents. billion (US $5.4m) would have to factor

shore up to N8 billion (US $21m). General Insur-

How arefirm you?would have to shore up ance prepared underwriting As a talent seeking borderless opportunities, their capital from N3 billion (US $8.2m) to what N10 plans you$27m), makingand todayComposite that will setInsurance you apart billion are (US from and better position the post firms others, would have to their capital you fromforN5 billion COVID-19 career opportunities wave? Talented (US $13.7m) to N18 billion (US $49.4m).

Reinsurance firmswith would have to shore up from N10 professionals competitiveskills will have the billion (US to $27.4m) to locally N20 billion $54.9m). flexibility compete and (US globally for job Certainly, this with recapitalization exercise had beopportunities you.

come necessary considering the current economic realities. It will no doubt also enhance the capacity of the insurance firms to underwrite big tickets transactions. The firms would also have enough capital to invest for expansion and technology – an area the industry is yet to fully take advantage of.

In the same vein, the Chartered Insurance Institute of Nigeria (CIIN), has continued to push for enhanced skill and capacity of insurance professionals in the industry. Also, to tackle lack of trust by the general public in the sector, operators have embarked on a rebranding campaign aimed at improving the image of the industry which would therefore boost public confidence.

However, this article seeks to dwell on the inadequate enforcement of the 6 classes of insurance in Nigeria as the major contributory factory for low penetration. The Nigerian Insurance industry, without any iota of doubt, is in a desperate need of enforcement of at least the compulsory classes of insurance. These include: Motor Third Party Insurance, Employee Group Life Insurance, Health Care Professional Indemnity, Insurance of Buildings Under Construction, Insurance of Public Buildings and Employers Liability Insurance.

The very sluggish rate of penetration is because Google the Photo laws ascredit: contained in theimages respective Acts are not effectively enforced.

How prepared are you?

In t h e m o nt h s a h ea d , t h e re w i l l b e n e w

Motor Third Party Insurance for top to leverage Aoppor recenttunities report released bytalents the Nigerian Insurers on. Companies will bethat searching for12 skilled Association (NIA) states of the over milprofessionals and technical experts.

To be highly lion vehicles on Nigerian roads, only 2.5 million competitive this changing era due of War have genuineininsurance.

Many, to for oneTalent, reayou or will have to demonstrate key competencies son the other prefer to purchase fake insurby developing relevant skills.

Malcolm ance policies at anew cheaper rate. The government Galdwell wrote in hisenforcement book “Outliers” that ithave takes and all relevant law agencies minimum ofstakeholders practice to master aa role to play.of It’s10,000 abouthours time all embark onAdapting more aggressive drive towards the ena skill. this approach will be pertinent forcement the third party motor in keeping of you ahead.

Belowinsurance are some for additional vehicles.

Withseeking the provision a N1 million Third ways talent careerofopportunities can Party property limitCOVID-19 liability cover to the leverage to staydamage ahead Post crisis. holder under section 68 of the Insurance Act 2003, insured motorists greatly and the 1. Build relevant skills tobenefit avoid skill miss-match: incessant verbalcan exchanges roads in the While nobody predict on theour future after the event arethat bound further reduce as crisis,of it accident is apparent theto workplace and skill number of insured vehicles increase. The NIA has organizations required will change partly due to greatly improved on the usage of www.askniid. technological advancement and the digitalization org the portal that captures all genuinely insured

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vehicles in the country. The portal is also being used to verify the authenticity of certificates issued, but a significant proportion of the vehicles plying our roads are yet to be captured, thus necessitating more aggressive enforcement. Ensuring most vehicles are genuinely insured will not only grow the revenue of the industry but also that of government through licensing fees whilst ensuring safer roads.

Employee Group Life Insurance By law, Employers with a minimum of 5 employees, are required to take life insurance policies in favour of employees for a minimum of three times the annual total emoluments.

Section 9 (3) of the Pension Reform Act 2004 requires that, ‘In addition to the rates specified in sub-section (1) of this section, employers shall maintain life insurance policy in favour of the employee for a minimum of three times the annual total emolument of the employee.’

Unfortunately, the enforcement of this law has not been wholistic, making several organizations to flout it, except those who mostly require certificates of compliance for government patronage.

Insurance of Public Buildings Section 65 of the Insurance Act 2003 expressly states that: (1) building shall be insured a of ‘Every work. public Bernard Marr predicted 8 skills with that are registered insurer against the hazards of collikely to be in high demand in the post COVID-19 lapse, fire, earthquake, storm and flood.’ world: (2) “Public building”, in this section includes a tenement house,and hostel, a building occupied by • Adaptability Flexibility a•tenant, lodger or licensee and any building to Tech Savviness which members of the public have ingress and • Creativity & Innovation aggress the purpose of obtaining educational • Datafor Literacy or• medical service, or for the purpose of recreaEmotional Intelligence tion or transaction of business.

• Critical Thinking In addition to the above, the section further • Digital and Coding Skills states the penalty of non-compliance to the law, • Leadership which is N100,000 or one year imprisonment or both.

Only a transferable very few owners and occupiers of 2. Develop skills: these public buildings adhere to this provision; Transferable are aware add-onskills can while some are skills not even they arethat breakserve a differentiating factor setting you apart ing theas law. from other withoccur, the potential help Usually, whentalents accidents workers ortovisitors the ahead buildingin dothe notjob get compensated beyouofstay market. Examples cause thereskills is no cover. of these areeffective communication, entrepreneurial skills, problem solving and

Insurance of Buildings under construction

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Health Care Professional Indemnity This is also a compulsory insurance policy required by the National Health Insurance Scheme (NHIS). As stipulated in Section 45 of the National Health Insurance Scheme Act of 1999, health care providers shall take out professional indemnity cover from an insurance company.

This, of course, is aimed at providing protection for the professional against liabilities that may arise from neglect, error, omission etc. while discharging his or her duties.

Despite all efforts of NAICOM and NHIS to ensure all medical professionals are covered under this policy, we still have practitioners that do not comply with this law.

Employers Liability Insurance As required in the Employee Compensation Act of 2010, all employers are expected to make a contribution of 1% of the total monthly payroll not later than the last day of each month into the Employee Compensation Fund in order to provide adequate compensation to employees or their dependents in the event of death, injury, disability, or diseases arising out of or in the course of employment.

One of the issues being encountered by the Nigeria Social Insurance Trust Fund (NSITF) is nonremittance of the statutory contribution.

Conclusion Awareness creation is vital, but beyond being aware, enforcement remains a potential key driver of patronage. No doubt the Nigerian Insurance Industry has shown some appreciable progress over the years, considering that the sector from 2005 to 2018 grew its premium income from N75 billion to the over N400 billion in 2018. There is still a lot of room for improvements and all hands must be on deck if it must catch-up with its counterparts.

The sector is in dire need of strict enforcement of at least the six compulsory classes of insurance.

Perhaps the enforcement of the and various creativity, collaboration, innovation team penalties as stipulated in the various Acts would management. be a good start. It will spread the insurance pen3. Invest your personal development etration likeinwildfire into the nooks and crannies ofItthe country.

Travel Insurance that is strictly is easier today than ever to invest in oneself.

The enforced by of some countries as a pre- to first halve 2020European is a free pass for everybody requisite for issuance of visa for instead rediscover themselves, upgrade their leads skills to and queues ofnew potential requesting this acquire ones. travelers If you know where tofor look, you category of cover they online would have ordinarilyon notthe can literarily obtain certifications taken. predicted in-demand skills basically for free. The The timeisto start acting is now and theto governworld literally at a standstill for you catch up ment must lead with iron will on this matter. on re-inventing yourself.

Majority of the online Stakeholders in the industry must double and, learning platforms are providing free access to in some cases, redirect their efforts towards online courses therefore making skills acquisition advocacy, collaboration and enlightenment exeasierto than Onegeneral of suchpublic, onlinebut learning ercises notever. just the this platform is Coursera, equipped with time, to drivers of these initiatives - thousands the law of learning materials on practically all topics. enforcement agencies, political influencers and Lastly, remember that you are amust talent, carry social elites.

These stakeholders beyou made immense value the end of before it all “Talent change agents thatand are at well informed any Always Wins” meaningful growth can be made in the sector.

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Excitement continues in eastern ports since Maersk Lines called at Onne, Calabar receives PMS Ignatius Chukwu

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astern ports are seen to have remained in high spirits and excitement since Maersk Lines began berthing at the Onne Port few months ago, while the Port Harcourt and Calabar ports continued to receive many ships with Calabar receiving premium motor spirit (PMS) deliveries.

This has continued to lift the spirits of the business community, importers and manufacturers as well as analysts and business commentators, as excitement sweeps through the region.

Maersk Line is indicated as Danish international container shipping line and the largest operating subsidiary of the Maersk Group, which began cargo shipping in 1928. Its presence in any port is seen as a huge endorsement, and thus elicits excitement.

Observers say West African Container Terminal (WACT) has now become the preferred container terminal outside of the Lagos area, and is now fast gaining reputation as the gateway to eastern Nigeria and the alternative to the ports in Lagos.

Witnesses in Calabar highlight that there was excitement among stakeholders at the Calabar Port Complex following the recent delivery of four shiploads of PMS to the port. They say the successful berthing of the four vessels was a feat that had never happened in the past 30 years.

They note that the feat followed some new initiatives put in place by the Nigerian Ports Authority (NPA) to revive the ports in eastern Nigeria and also boost trade in that axis.

The move, according NPA managing director, Hadiza BalaUsman, is said to decongest the

two ports in Lagos; the Apapa Port Complex and the Tin-Can Island Port.

Business leaders and public analysts, especially supporters of the minister of transportation, have therefore been jubilating, saying whereas the entire world was being ravaged economically since the advent of the Cobid-19 pandemic, President Muhammadu Buhari and the minister, Chibuike Rotimi Amaechi, have done something big for eastern ports.

One of those who issued a statement to this effect is Eze Chukwuemeka Eze, a chieftain of the All Progressives Congress (APC) in Rivers State and strong Amaechi supporter who described the feat as another milestone in the development and expansion of ports to boost economic activities through a robust system of international trade.

He says: “President Buhari has executed this major feat through the leadership and foresight of the Minister of Transportation whose commitment to service delivery is yielding tremendous results in all spheres of the economy and national life.

“All wise leaders know that as you fight the deadly pandemic, you also keep an eye on the economy and any opportunity that can happen despite the crisis, because after rain comes sunshine.”

According to Eze, Rivers State has thus made history as the first Maersk lines service has berthed in Onne, directly from China, coupled with the feat of the Calabar Port in Cross Rivers State taking delivery of four shiploads of PMS to help in decongesting Lagos, first in 30 years. This calls for celebration, events that past administrations couldn’t achieve.

Accounts of applicants for N50bn COVID-19 fund to be credited in 48hrs - CBN HOPE MOSES-ASHIKE

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entral Bank of Nigeria (CBN) on Monday said all successful household and Small and Medium Enterprises (SMEs) applicants who submitted their account details for the N50 billion Covid-19 targeted credit facilities should expect their accounts to be credited in 48 hours of such submission.

The CBN stated this in its official tweeter handle, saying otherwise the applicants should call 09010026900.

The CBN, on March 2020, set up the N50 billion facility to be disbursed at single digits through the NIRSAL Microfinance Bank for households and

SMEs that would be particularly hard hit by Covid-19, including hoteliers, airline service providers, health care merchants, among others.

Rogers Nwoke, president, National Association of Microfinance Banks (NAMB), said the N50 billion was too small for the huge funding gap in MSME working capital needs.

He said Microfinance Banks (MFBs) disburse more than that in a month, saying, “You cannot get the needed traction by letting only one new MFB with limited spread to do this disbursements.”

He said the CBN should make available another N50 billion through qualifying MFBs and the funds would reach MSMEs in less than one month.

How we’re tackling Ikorodu Road gridlock - Sanwo-Olu’s aide JOSHUA BASSEY

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pecial adviser to the Lagos State governor on works and infrastructure, Aramide Adeyoye, has unveiled plans by the state government to ease the perennial gridlock being experienced from Ikorodu inward Lagos.

Adeyoye, at a stakeholder’s meeting involving traders from the Mile 12 Market, transportation unions and the contractor being engaged to handle the reconstruction of the road, said the move would bring relief to thousands of motorists and

commuters who daily get stuck in traffic along that axis.

According to Adeyoye, the government will soon be releasing travel advisory for motorists plying the road ahead of the planned commencement of reconstruction works from Mile-12 to the Ketu section of the road.

She said the traffic plan would include traffic diversion, alternative routes, day and night canter flow schedules for traffic managers and a strict enforcement of extant environment and traffic laws during the construction period. www.businessday.ng

Why Nigeria’s power sector privatisation is not working – Gencos OLUSOLA BELLO & DIPO OLADEHINDE

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lectricity Generation Companies (Gencos) in Nigeria have explained why the privatisation of the power sector is not working and Nigerians’ inability to enjoy stable power supply more than six years after the sector was handed over to them.

The Gencos were reacting to a call by Senate president, Ahmad Lawan, for the review of the privatisation exercise for failing to deliver on its objectives.

Joy Ogaji, executive secretary, Association of Power Generation Companies (APGC), in a statement in Abuja, argues that instead of seeking to upturn the privatisation of the sector, the Senate should look into how the current challenges can be sorted out.

The Gencos, who operate under the banner of the APGC, while empathising with Nigerians on the current abysmal situation of electricity supply, maintain that the reversal of the privatisation

exercise of 2013 is not the solution to resolving the current sorry state of the sector.

They complain that close to seven years after privatisation, a number of the guidelines stipulated in the governing contract have still not been activated, leading to non-payment for power generated and supplied to the national grid.

“This has led to a huge outstanding debt of approximately N1 trillion owed to Gencos from the inception of privatisation till date. All contracts remained inactivated, notwithstanding the declaration of the Transitional Electricity Market (TEM), which heralds contract effectiveness.

“The Gencos were made to bear the brunt of this lacklustre performance on the part of NBET (Nigeria Bulk Electricity Trading) as the off-taker of the Gencos power,” the generation companies argue.

According to the Gencos, the generation companies only receive a payment of between 11 percent and 30 percent of their

invoiced amount on a monthly basis, leaving out a huge outstanding receivables and arrears in excess of 1,000 days after invoicing without taking cognisance of the interest on delayed payments and foreign exchange volatility.

While noting that the weak transmission (grid) and distribution network inherited from the PHCN are still in existence and are not complementing their efforts in maximising available capacities, the Gencos say that they had worked to attain average available capacity of 8,589MW and installed capacity of 13,427MW with an expansion capacity of 20,000MW. They argue that if not for the weak grid system, average stranded capacity that could have been made available to Nigerians in the light of maximum attained grid capacity is an average of 3,214MW. “This implies that if we had a grid capacity that matches our average available capacity, 3,214 MW can be immediately made available to Nigerians with the current state of operations of the

Gencos and at no additional cost,” APGC states.

It adds that notwithstanding the non-payment of Gencos’ invoices for power supplied to the national grid, the companies took loans and other credit facilities to fund the capital expenditure required to meet the minimum performance threshold by ramping up capacity.

“It is very important to stress that the Gencos have doubled their available capacities from 4,214MW at takeover in 2013 to 8,145MW in 2020. Out of the 8,145MW available capacity, only 3,987MW is generated for Nigerians. The balance 4,159MW is stranded as a result of constraints in the national grid capacity.

“Gencos in addition to acquiring the assets for over $1 billion have invested heavily in ramping up nameplate capacity through frequent maintenance, minor and major inspections and also major overhauls,” the generation companies say.

Olakunle Oluomo, speaker, Ogun State House of Assembly (m, in 1st row); Bamidele Abiodun, wife of the governor (2nd r); Salimot Badru, ex-deputy governor (1st r); Funmi Efuwape, commissioner for women affairs and social development (2nd l), shortly after the Ogun State governor’s wife-led delegation of women to the Ogun State House of Assembly on advocacy visit to the Legislature against rape.

L AWM A t a rg e t s 2 0 - m i n u te turnaround time for waste trucks JOSHUA BASSEY

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agos State may be in for a cleaner environment as the new management of Lagos Waste Management Authority (LAWMA) says it is introducing operational dynamics that will ensure that waste trucks spend an average of 20 minutes at dumpsites.

The acting managing of the agency, Ibrahim Odumboni, said the new measure would achieve faster turnaround time and evacuation of wastes from the streets and neighbourhoods across the state.

Odumboni said the approach would ultimately result in a liveable environment for all residents.

Odumboni also told journalists, Monday at the agency’s headquarters at Ijora, that various other initiatives were being lined up to improve waste management in the metropolis and enhance the operational efficiency of PSP operators, with particular emphasis on effective turnaround time at dumpsites.

He said the authority would collaborate with other agencies in the state to ensure that the challenge of improper waste disposal was holistically tackled, as establishing a cleaner and healthier environment required collaborative efforts.

He called on the residents of Lagos to shun indiscriminate waste disposal, which had negative consequences on the environment and people who live in it, adding that the populace should imbibe the culture of recycling and waste sorting, being spearheaded by the authority.

He revealed that the agency would soon launch LAWMA academy, targeted at inculcating the tenets of effective waste management into the younger ones, and through the programme, school children, students, corps members and interns would have the opportunity of being taught the best practices in waste management.

He admonished residents to call LAWMA toll-free line for PSP related issues and other inquiries.

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COVID-19: Three Crowns Milk supports communities with relief packages Josephine Okojie

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hree Crowns Milk has partnered four non-governmental organisations (NGOs) to give relief packages of quality dairy nutrition to over 11,000 families in Lagos, Oyo and Ekiti state to support the fight against the COVID-19 pandemic.

In Lagos, Three Crowns partnered with Lagos Food Bank to cater to 3,944 families, and Tahara Collective to cater to 1,000 families, while in Ibadan, Oyo state, the brand partnered with Made Great by God Foundation to cater to 3,717 families.

Similarly, in Ekiti State, the brand partnered with Bayo Omoboriowo Foundation to cater to 2,490 families with its nourishing products.

Speaking on this charity gesture, Omolara Banjoko, marketing manager, Three Crowns, said that the brand was moved to ease the nutrition challenges of the most vulnerable in these communities, which the COVID-19 global pandemic has thrown at them. @Businessdayng

“Three Crowns strongly believe that eating right, feeding well and living healthy is a vital start in the fight against the pandemic,” Banjoko said in a statement.

During the lockdown, the Three Crowns fitness campaign helped Nigerians to keep fit through a weekly live fitness and the cardio session on the brand’s Instagram handle @3crownsMilk which was hosted by a renowned fitness coach, Shedams.

The live interactive sessions on Instagram address challenges on fitness, diet, mental health and offers tips on how to make money during the lockdown and afterward.

Three Crowns milk is a leading Nigerian brand from the stable of FrieslandCampina WAMCO, Nigeria’s largest dairy company for more than 60 years. The organisation believes that milk is an essential nutrient for every individual.

As Nigeria’s leading low cholesterol milk brand, Three Crowns has nourished mothers and their families for more than 30 years with essential vitamins and minerals that support their well-being.

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COVID-19: Airlines to face decline of between 2,247, 2,915m passengers in 2020 IFEOMA OKEKE

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irlines operating in and out of Nigeria will face a general decline of between 2,247 and 2,915 million passengers in year 2020, according to data from International Civil Aviation Organisation (ICAO).

This decline is occasioned by the regulations of the Nigeria Civil Aviation Authority (NCAA) demanding that airlines offer 48 percent to 63 percent load factor.

According to transport data by the ICAO, a possible potential loss is approximated at between $104 and $136 billion in gross operating revenues of airlines The Nigerian aviation industry, which is totally denominated in foreign exchange, has not been spared either, as foreign exchange is needed for aircraft procurement, training of pilots, sourcing for jet oil and spare parts, as well as maintenance.

In an effort to contain the spread of Covid-19, all Nigerian international airports were shut

on March 23, 2020, except for emergency and essential flights.

This has left about 120 domestic aircraft grounded nationwide, leaving operators without a source of income but recurrent expenditure.

The Federal Airports Authority of Nigeria (FAAN) has been most affected, cognizant of the fact that it has a workforce spread across a total of 22 airports in the country, and without a source of revenue.

Other agencies with similar predicament include the Nigerian Civil Aviation Authority (NCAA), which is the apex regulatory body for aviation, and whose monthly overhead stands at N750 million; the Nigerian College of Aviation Technology (NCAT), which requires N150 million monthly; the Nigerian Metrological Agency (NIMET), which requires N290 million monthly, and the Nigerian Airspace Management Agency (NAMA), which requires more than N500 million.

According to World Bank data, 2020, prior to the Covid-19

crisis, aviation contributed $1.7 billion to Nigeria’s GDP, offering employment support to 241,000 persons.

Figures by the Nigeria Bureau of Statistics indicate that by the end of Q4 in 2018, aviation was the second fastest growing sector in the country, taking the lead by Q4 in 2019.

According to the International Air Transport Association (IATA), this pandemic risks 124,000 Nigerian aviation jobs, which would see the country lose up to $900 million in GDP. Already, the major carrier in Nigeria, Arik Air, has asked 90 percent of its 1800 staff to proceed on indefinite unpaid leave, with the remaining 10 percent subjected to an 80 percent pay cut on their salaries/wages.

There are fears that up to 50 percent of the workforce may be compelled to resign, as the airline plans to right-size the workforce.

In April, Max Air followed suit by sending its staff on unpaid leave, for the period of the imposed lockdown.

COVID-19: ACCA seals pact with ICC on global call to save businesses CHUKA UROKO

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s coronavirus continues to ravage the world with significant impact on lives and livelihoods, the Association of Chartered Certified Accountants (ACCA) joins forces with the International Chamber of Commerce (ICC) United Kingdom to push global call to save small and medium scale businesses (SMEs).

The two organisations recently signed a memorandum of understanding (MoU) that will see both parties on a Save Our SMEs (SOS) global campaign as well as sharing professional insights research.

A statement by ACCA, obtained by BusinessDay at the weekend, explains that the SOS campaign highlights the challenges many SMEs are facing due to the impact of Covid-19.

The campaign has clear sixpoint recommendations for governments around the world to offer tangible support to SMEs in these difficult times.

“ICC’s SOS campaign is an impressive global initiative, highlighting the vulnerability of SMEs at this time. Our own research into the impact of Covid-19 on busi-

ness sectors clearly shows that small businesses have a more pessimistic view of what lies ahead compared to larger organisations.

“Revenue and profit are specific concerns. Among business leaders in smaller organisations –those with fewer than 200 employees – 85 percent expect yearon-year revenue to be lower than the previous year, and 86 percent expect year-on-year profit also to be lower,” Helen Brand OBE, chief executive at ACCA, notes.

On his part, Chris Southworth, secretary general of ICC, United Kingdom, says they are delighted to have ACCA’s support in this venture. According to Southworth, this is a critical moment for businesses across the world, in particular, for SMEs that may operate with smaller margins.

“These businesses form the backbone of the economy and governments globally must give them the support they need throughout the crisis, or they risk incurring long-term economic damage,” Southworth states.

The statement reveals that ACCA and ICC will work together to share in their respective memberships’ insights and guidance

to sustain SMEs and the SMPs that support them throughout the current crisis and beyond, adding that they would also invite their stakeholders to take part in each other’s events and research initiatives.

It reveals further that options will be explored to work together on co-branded research projects, policy development and co-hosted events around critical issues for businesses. “These will leverage the diverse and complementary know-how of our networks to support SMEs globally, and drive inclusive growth and prosperity,” Southworth assures.

ACCA is the global body for professional accountants, offering business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.

The association supports its 219,000 members and 527,000 students (including affiliates) in 179 countries, helping them to develop successful careers in accounting and business, with the skills required by employers.

FG inaugurates committee to steer Nigeria’s digital identity for development ecosystem project Jumoke Akiyode-Lawanson

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he Federal Government has inaugurated a steering committee for the Nigeria digital identity for development ecosystem project to fast-track the implementation of the strategic roadmap for accelerating digital identity development for Nigeria.

Inaugurating the committee, Boss Mustapha, Secretary to the Government of the Federation, who also doubles as the chairman of the committee, states that digital identification is central and critical to realising the objective of the Government’s Economic and Recovery Growth Plan (ERGP).

Mustapha says the strategic roadmap, approved by the Federal

Executive Council (FEC) on September 12, 2018, “is a culmination of the enormous collective efforts and contributions of so many institutions and stakeholders which began in the year 2015 when this Government took a decision to forge a credible and cost-effective pathway for identification management.”

To accelerate the implementation of the strategic roadmap, therefore, “Government considered and adopted a three-tiered institutional arrangement comprising of a steering committee, a strategic unit, an implementation unit situated in the National Identity Management Commission (NIMC), and with responsibilities for providing overall governance www.businessday.ng

and coordination, ecosystem partners’ coordination and communication and day-to-day project implementation respectively.”

According to Mustapha, “The project steering committee was established as the highest body with the responsibility of providing policy, institutional and operational guidance towards delivering on the identification vision and promise of the strategic roadmap. Members of the steering committee were appointed

by Muhammadu Buhari, President of Nigeria. You are therefore charged to positively steer the project to accomplish Government’s objectives, consolidate efforts to date and deliver goals outlined in the strategic roadmap.” https://www.facebook.com/businessdayng

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Court restrains Oshiomhole, APC from conducting primaries in Edo

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ederal High Court in Edo State has restrained the national chairman of the All Progressives Congress (APC), Adams Oshiomhole and the APC from conducting any mode of primary election in the state, pending the determination of the suit filed, which is now adjourned to June 11, 2020.

In his ruling, Justice M. G. Umar, gave the order in a suit filed by Kenneth O. Asekomhe, and Mathew Aigbuhuenze Iduoriyekemwen.

The APC, Oshiomhole, the Independent National Electoral Commission

(INEC) and the Inspector General of Police (IGP) are defendants in the suit, which is seeking to restrain them from proceeding with the direct mode of primary election to select a candidate to fly the APC’s flag in the September gubernatorial election.

Justice Umar granted the order restraining the conduct of any mode of primary until the determination of the suit fixed for June 11, 2020.

The legal teams representing all parties in the suit were present, including that of the INEC and others.

Rave reviews Trail UBA’s innovative mobile banking app

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lowing reviews and commendations have not stopped coming in since United Bank for Africa (UBA) plc upgraded its Mobile Banking app.

Over the past few weeks following the upgrade, social media sites including Twitter, Instagram and Facebook have been agog with excellent comments about the ambience, functionality and versatility of UBA’s revamped mobile app.

The latest of such glowing reviews came last weekend from a former minister of aviation, Osita Chidoka, who on his social media handles, gave kudos to the bank for introducing lots of exciting and interactive features to aid banking, while allowing customers to perform unlimited transactions from the comfort of their mobile phones.

Chidoka, a former corps marshal/CEO of Federal Road Safety Corps, pointed out that the bank put into play its experience as an institution with several decades of operations as well as modern technology to come up with a revamped app worthy of emulation by other

financial institutions some of which he mentioned in his post.

In his words, “UBA, surprised me with a massive improvement on their app. I used to consider them the sleeping giant of Nigerian banking. I thought they had great brand equity and name recognition.

UBA combined the savvy feel of a new generation bank with the history of a legacy bank. As I opened their mobile app today, I couldn’t help but give them a high five. The app is beautiful, user interface is great, navigation is seamless and the need to go to a branch is reduced for small users like us.”

While urging other banks to borrow a leaf from UBA’s move, Chidoka continued, “As a customer, I have always challenged the banks on their slow adaptation to change and weak emphasis on improving customer experience. I pray UBA pushes forward in this direction and continues to surpass themselves.

Sooner than later disruptive online banks will change the face of banking in Nigeria, hence the need for constant innovation by the industry.”

JAMB to review admission guidelines Godsgift Onyedinefu, Abuja

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he Joint Admissions and Matriculation Board (JAMB) has scheduled the 2020 Policy Meeting of all tertiary institutions for June 16, to set admission guidelines, deliberate and take a stand on concessional and acceptable minimum admissions standards to be applied in all admissions to be undertaken by all tertiary institutions in Nigeria.

JAMB in its weekly bulletin explains that the Policy Meeting, which will be chaired by the minister of education with all heads of tertiary institutions in attendance, will also chart policy directions for the nation’s tertiary institutions and make a holistic review of application statistics, performance as well as evaluate the 2019 admissions exercise.

The meeting, in addition to other deliberations, will also discuss critical issues bordering on the advances made in the educational sector in the last one year in addition to setting the tone for the 2020/2021

admission exercise.

According to JAMB, the 2020 Policy Meeting is peculiar as it will go down in history as the first Policy Meeting that will be holding online owing to the COVID-19 Pandemic.

It would be recalled that part of the protocols put in place by government to curb the spread of COVID-19 require that no gathering of persons exceeds prescribed numbers.

Compliance with this directive has become imperative as no fewer than 4,000 heads of tertiary institutions comprising degree, diploma, NCE and NID-awarding institutions and other stakeholders would normally be expected to congregate at a location but because of extant protocols, would now be expected to participate in the virtual meeting.

The modalities for the meeting would entail the Board issuing only one access code to each participating institution to join the meeting.

This access code is not to be shared or given to unauthorised persons. www.businessday.ng

NDDC says it awarded no contract to Akpabio, releases names of 11 firms used by senator to amass contracts Ignatius Chukwu

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he fight between the Niger Delta Development Commission (NDDC) and a section of the National Assembly (NASS) has continued to rage unabatedly, as management of the Commission has denied awarding any contract to its supervisory minister, Godswill Akpabio, minister of Niger Delta Ministry.

Instead, the management released the names of 11 companies through which it said a senator from Delta State and has been in the centre of the NASS committees with oversight functions over the NDDC, Peter Nwaobosi, allegedly amassed contracts. Sources said the senator used to collect contracts and share to key members of the NASS on NDDC’s matters.

The statement names the companies as: Noan Integrated Services; De Towers Constructions & Allied Services Ltd; Franstine Nigeria Enterprises; Edrihide Company; Isumabe UK Global;

Benchmark Construction & Allied Services Ltd; Millstone Allied Builders Ltd; Nelpat Nigeria Company; Agh-Rown Ventures; Edendoma Stars International, and Antlers Construction and Allied Works Ltd. Nwaobosi had accused the NDDC of awarding N500 million to Akpabio and accused the minister of inside deals and other infractions. A letter had gone to the Economic and Financial Crimes Commission from the office of the Senate president to probe Akpabio. The Senate president immediately wrote to deny issuing such a letter. This has pointed fingers at Nwaobosi, according to the statement by the director of corporate affairs, Charles Odili.

Meanwhile, the panic in the Commission since the death of the executive director (Finance) seems to increase following six positive cases that came out after a test session. About 27 others who tested negative have proceeded on isolation. They are said to come from the unit of

the executive director (projects) alone, though the executive director himself, who has been waging the war against the NASS on behalf of the Commission, is said to test negative.

The Commission said it had searched its records but could not trace any contracts awarded Akpabio or any company associated to him. Instead, the statement said it is the serving senator that accumulated contracts of N3.6 billion from 11 contracts as far back as September 2016.

Saying the companies were either owned by the senator or traceable to him, the statement said; “Our records show that (the senator) used 11 front companies (owned or traceable to him) to secure the contracts in what is perhaps the biggest single case of looting of the Commission’s resources. “The inventory records show that these items were supplied and received on (the senator’s) business premises and warehouse. Meanwhile, the contracts were awarded to him.

However, some of the items sup-

plied to his warehouse through his cronies were later resold to the Delta state government, while the others were sold to other states through contracts awarded to him.

“All supply agreements were signed by one and the same person being (name withheld) traceable to the senator. This is in flagrant contravention of section 58(4) (a) and (d) of the Public Procurement Act. No wonder the senator and his cohorts are jittery about the ongoing forensic audit exercise in the NDDC and are doing everything possible to derail it.”

The statement advised the senator to step aside in any investigative activity against the NDDC. Meanwhile, mass testing expected to cover all workers at the Commission has begun.

Thus, the tension in the region and in the NDDC seemed to take a notch with the results of six staff members in the office of executive director, projects, returning positive.

Zainab Bagudu (m), wife of Kebbi State governor, with her staff members, during a virtual meeting with Paulen Tallen, minister of women affairs; Tony Ojukwu, director-general, Human Rights Commission; Bisi Fayemi, wife of Ekiti State governor, and others, over the growing spate of rape and gender-based violence in Nigeria and the recent rape and murder of Vera Omozuwa.

VFS seeks government intervention, support for smallholder farmers amid COVID-19 Desmond Okon

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oices for Food Security (VFS), a network of agricultural professionals promoting food security and advocating for increased investment in agriculture, has called on the government to intervene and support amid the COVID-19 pandemic.

Although, the body, comprising of civil society and non-governmental agricultural stakeholders commended the government’s effort at ensuring that the Emergency Economic Stimulus Bill was signed into law, and the Central Bank’s plans to inject N3.5 trillion into the economy.

However, VSF expressed concerns regarding efforts to strengthen the economy following the outbreak of COVID-19 pandemic in Nigeria, stating that smallholder farmers across the country have incurred serious losses.

“Most recent Federal Govern-

ment guidelines for the movement of agricultural produce to curtail food shortages and ensure effective 2020 crop production is appreciated.

However, there is still silence on how smallholder farmers who have already suffered losses can be compensated,” the group said in a statement.

“We observe that these palliatives and recovery windows may well work for the manufacturing and other sectors, but we are concerned that they do not adequately cover the needs of the agricultural sector,” the group said.

VFS observed that though agriculture has been termed a key sector for years, none of the relief efforts explicitly takes note of the issues facing agricultural sector stakeholders, adding that the fact that Farmers Associations are not strictly termed SMEs will make them ineligible for SME financing from the CBN.

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MAN in dialogue with Kano over re-opening of companies Adeola Ajakaiye, Kano

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s part of the ongoing consultations aimed at re-opening the economy of Kano State, which has remained shut down since the outbreak of Covid-19 in the state, Kano State government has initiated a dialogue with manufacturers to work out a feasible way of re-opening manufacturing plants within the framework of the lockdown.

The dialogue session is primarily geared at re-designing the ongoing lockdown imposed on the state, in a way that a window of opportunity could be created for the shutdown companies to start skeletal operations.

The maiden edition of the dialogue, which began on Monday, inside the African House Wing of the Kano Government House, had in attendance major players in the manufacturing economy of the state, and provided avenue @Businessdayng

for critical issues to be discussed with Governor Abdullahi Umar Ganduje, on the possible ways of re-opening the manufacturing sector as a whole.

Speaking on behalf of the Manufacturers Association of Nigeria (MAN), which was witnessed by BusinessDay, Sani Hussaini Saleh, chairperson, Bompai branch of MAN, said the prevailing lockdown had drastically affected industrial activities in the state.

Sani disclosed that apart from the few industries involved in rice milling and table water production that were allowed to operate under the lockdown, almost all other manufacturing concerns in the state had been under lock and key since the lockdown began.

According to Sani, one of the most negative observations during the lockdown on the sector was that some agents of the government involved in tax collection continued to demand the payment of the land use charge from the companies.

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COMPANY NEWS ANALYSIS INSIGHT

CWG begins Online Academy Session across Nigeria MODESTUS ANAESORONYE

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he training and capacity building arm of CWG Plc, CWG Academy has started a six-week online session this June with registered students across Nigeria after orientation programme.

The online training is occasioned by the Covid-19 pandemic, which has forced many countries, including Nigeria, to declare a lockdown of activities with the closure of schools and many people working from home.

This birthed ‘CWG Online Academy’ is an initiative of the CEO, Adewale Adeyipo.

The online Academy session is to be coordinated by Oghenetega Ogbeni, a Business Development manager.

She stated that though the world is on recess due to the pandemic, this should not halt the impartation of the needed knowledge and technical know-how to the youths of Nigeria. “CWG’s top management team, the Chief Information Officer and I decided to leverage on tech-

nology to connect students around the country”, she said. The session began with an orientation programme students watching and listening to experts speak various aspects of Information and Communications Technology and what it takes to work

inner a conglomerate such as CWG Plc and becoming a successful entrepreneur from the comfort of their homes on. The coordinator of the orientation programme, Marcel Odiboh, chief information officer at CWG Plc, encouraged the students to

stay focused, stressing that the Academy aims to provide them with best of knowledge to help build and shape them as future leaders in the ICT sector.

“You are encouraged to remain as focused as you can. Our interest in you as a

L-R: Funmi Ayoola, Lagos Team Lead, Dagomo Foundation; Joy Egolum, Corporate Affairs Manager(Lagos & HQ), Nigerian Breweries Plc; Ibrahim Lukman, beneficiary; Okocha Success, another beneficiary; Utibe-Abasi Utuk, Lagos Brewery Manager, Nigerian Breweries Plc and Anulika Akuagbazie, Head Brewer, Lagos Brewery, Nigerian Breweries Plc during the donation of drinks and food items to the elderly through the Dagomo Foundation by Nigerian Breweries Plc in Lagos today.

Bua cement Q1 profit grows 14% AOPN urges FG to make outsourcing despite slowdown in economic a strategic tool for job creation GBEMI FAMINU

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UA cement, one of the key players in Nigeria’s cement market has recorded a growth in its profit margin despite economic disorder affecting productive and commercial activities.

In its recently released financial report for the first quarter of 2020, the cement giant recorded a gross profit of N24 billion representing an increase of 14.2 percent from the N21 billion recorded in the corresponding period of 2019.

Similarly, the firm’s profit before tax grew by 17.6 percent to N20 billion from the N17 billion realized in the 2019, while its profit after tax stood at N19 billion representing an increase of 26.6 percent from the N15 billion realized in the previous year.

The firm’s other income grew by 100 percent to N2.2 billion from N1.5 billion recorded in 2019, this increase stemmed majorly from its haulage income on goods delivery.

However, the firm’s energy cost increased by 24.7 percent to N10.6 billion, its raw materials sourcing cost N11 billion while it spent N4.8 billion on fuel

company is to provide you with the major skills needed to have a thriving career in the ICT sector,” he said.

One of the facilitators, Tereigh Banks, Ozakpo, head, Digital Financial Platforms, (BillsnPay & Vericash) at CWG while speaking, assured

Since the entry of BUA into Nigeria’s cement market, the industry has experienced significant expansion. Less than six months after commissioning its 1.5million metric tonnes per annum Kalambaina Cement Plant in Sokoto State, BUA has Cement completed its newest Obu plant in Edo State, which has a capacity to churn out three million MT annually of cement annually. This brings the total capacity of BUA Obu cement operations to six million tonnes and move the entire group’s installed capacity to eight million MT per annum.

BUA Cement plc is a business combination of CCNN Plc (Sokoto Cement) and BUA Cement Manufacturing Company’s Obu Cement Company, which was completed in January 2020 and is currently listed on the Nigerian Stock Exchange (NSE), with a market capitalisation of N1.18 trillion ($3.3 billion), making it the third most capitalised company on the floor of the Nigerian bourse as well as the second largest producer of building material. At the close of trading activities on Monday, the company stock price’s stood at N41 per share.

JOSEPHINE OKOJIE

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he Association of Outsourcing Professionals of Nigeria (AOPN) has urged the Federal Government to make outsourcing a strategic tool for job creation by strengthening and positioning the industry for economic growth.

In a statement made available to BusinessDay, AOPN says outsourcing is an integral part of services export and offers significant opportunities with the aim of creating jobs, earning FX, enhancing competitiveness, and stimulating economic growth among others.

“Outsourcing is an enabler for economic growth. Capabilities in outsourcing and positioning as an outsourcing destination create a significant surge in job creation and by extension, wealth creation,” said Madu Obiora, president, AOPN in the statement.

“This administration has job creation as one of her cardinal points and we believe that strengthening the outsourcing sector will go a long way in this direction,” Obiora said.

He noted that India and the Philippines have recorded immense success in creating jobs for their citizenry through their outsourcing industry owing to the critical role played by the

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various governments in ensuring that outsourcing thrives.

He says it is therefore critical for government agencies with oversight function for the outsourcing sector to champion the cause for Job creation through the promotion and standardisation and regulation of the industry in the country.

He added that the standardisation and regulation of the country’s outsourcing sector is imperative for economic growth and international recognition.

According to him, the global business process outsourcing and contact centre industry currently employ close to 12 million people and nearly 88percent of them are aged between 19 –36 years.

Data from the National Bureau of Statistics (NBS) states that about 1.8 million youth enters the Nigerian labour market yearly.

“In addition to the detrimental effects on the nation’s economy, unemployment and poverty are the primary causes of addiction and substance abuse by teenagers and young adults in Nigeria,” he said.

“A reduced unemployment rate will bring about improved human development and reduce poverty. It will also reduce crime and insecurity and attract foreign investment into the country,” he further said.

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the students that apart from giving them book knowledge, the students are also expected to gain hands-on skills in the areas of software, hardware, project management and basic knowledge of ATM and PoS.: “You can be assured of learning the skills required to succeed in the ICT ecosystem and compete favourably among your peers globally,” he assured.

Meanwhile, Mr. Emmanuel Effiong, training manager at the Academy, while also speaking to the students, disclosed that the online resumption is not quite different from the conventional classroom.

He added that the Academy is one of the many ways CWG contributes her quota to Nation a building by helping to tackle the Nigerian unemployment quagmire.

“What we do here is to create the know-how and confidence needed to be the next set of Tech-leaders in Nigeria as we believe doing this will continue to create jobs for other Nigerians, riding on technology,” he said.:

DHL moves to grow e-commerce footprint in Africa MIKE OCHONMA

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HL Express has acquired a minority stake in Link Commerce; the UK-based e-commerce firm that helped the logistics company develop its DHL Africa eShop platform. The acquisition company demonstrates the company’s commitment to growing ecommerce in Africa.

Hennie Heymans, DHL Express sub-Saharan Africa CEO said,“Acquiring a stake in Link Commerce, the company behind the MallforAfrica.com platform, positions us to realise our ambitions of growing the eShop offering globally, and to work on the scalability of the platform when the opportunity arises.”

He said the new strategy will help DHL expand its white-label turnkey B2B e-commerce platform and provide online shoppers with the ability to shop more and get more at great shipping rates, fast.

Just more than one year on from its initial launch, the DHL Africa eShop continues to see “massive growth in sub-Saharan Africa”. He says the DHL Africa eShop has consistently outper@Businessdayng

formed expectations since its launch.

The platform was developed in partnership with Link Commerce and initially launched in 11 African countries in April, 2019.It was an immediate success, gaining around 5 000 subscribers within the first six weeks.

“Today, DHL Africa eShop is live in 34 countries across sub-Saharan Africa with tens of thousands of users across the continent and enables African customers to shop directly from over 200 US- and UK-based online retailers, with purchases delivered directly to their door, by DHL Express,” explains Heymans.

The DHL Africa e-Shop offers African consumers access to international retailers.

“Online buying behaviours and product mixes have evolved quite significantly since the onset of Covid-19,” he adds.

“Some of the most popular items on the platform now include productivity and communications devices to support remote working, home and kitchen appliances, entertainment gadgets and health-related products, in addition to the historic orders of fashion and beauty products.

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POLITICS & POLICY Five years in the saddle: Despite challenges, we’re on path of progress - Presidency Iniobong Iwok

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ince Friday, May 29, 2020, there have been a lot of assessments on the performance in office of elected political actors in Nigeria. There were, however, no drums rolled out that day for celebration. That was deferred till Friday, June 12, 2020, a date that has been officially recognised as the Democracy Day in Nigeria.

Recall that President Muhammadu Buhari had on June 6, 2018, while recognising Moshood Kashimawo Olawale (MKO) Abiola, posthumously, moved the Democracy Day celebration from May 29 to June 12. The late Abiola presumably won the presidential election held on June 12, 1993 but was not allowed to exercise the mandate given to him. In his struggle to reclaim that mandate, he died.

The current Buhari administration came into power on May 29, 2015 and was also inaugurated for a second term in office on May 29, 2019, having been declared winner of the presidential election held on February 23,2019.

Opinions are divergent on the performance of the All Progressives Congress (APC)led government in the last five years. Whereas some observers believe the nation is still contending with the teething problems of yesteryear, pointing epileptic electricity supply, insecurity, high unemployment rate, high poverty rate, massive corruption in high places, among others, the Federal Government pooh-poohs such assessment.

The administration prefers rather to say that though challenges abound, it has put up a sterling performance in the last five years and that the administration has been on the path of progress. It, however, says it is not resting on its oars to address all challenges since it is still work in progress.

In an apparent move to convince some doubting Thomases that the administration has not been sleeping on guard, the Presidency recently pointed out key areas it believes it has performed creditably.

In a document, ‘Buhari Administration’s Fifth Anniversary Factsheet’, a copy of which was sent to BusinessDay recently, the Presidency listed areas it believes it has recorded a huge success. Such areas include agriculture, making business work, Ease of doing business reform, pension reforms, and monetary, fiscal, trade, immigration, consumer protection reforms.

It noted that a number of Executive Orders signed by the President since 2017 has helped a great deal in shaping the economy and restoring sanity to the system. According to the document, successes have also been recorded in the areas of infrastructure- (power, transport- road, air, water, railway, etc), and in the Oil & Gas sector.

It also said that the administration has continued to invest in people as the Social Investment Programme (SIP) has remained the largest and most ambitious social safety net programme in the history of Nigeria with 12 million direct beneficiaries so far.

Other areas where great success has been recorded include healthcare, Science, technology & innovation, sports, creative industry, new vision for the Niger Delta, anti-corruption and transparency, justice reforms, prison reforms, security, diplomacy and international relations, and the coronavirus response.

In 2015, the APC couched its campaign on the “change” mantra. It promised Nigerians succour and a paradigm shift from way of doing things in the country.

In 2019, while seeking a re-election, President Buhari and his party anchored their manifesto on ‘Our Vision for a New Nigeria’. It made critical promises cutting across many spheres of national life. The promise was essentially aimed at taking Nigerians to the ‘Next Level’, which was the catchword during the electioneering campaign.

Pointing to some of its achievements in office, the administration said that its efforts at diversifying the economy, through Agriculture, have yielded some fruits.

It points to the Anchor Borrowers Programme (ABP) of the Central Bank of Nigeria, launched by President Buhari on November 17, 2015, saying that the initiative has made available more than N200billion in funding over 1.5 million small holder farmers of 16 different commodities (Rice, Wheat, Maize, Cotton, Cassava, Poultry, Soy Beans, Groundnut, Fish), cultivating over 1.4 million hectares of farmland.

According to a recent document that listed some of the scorecards of the administration in the last five years, the ABP has substantially raised local production of rice, doubling the production of paddy as well as milled rice between 2015 and 2019.

“Between 2016 and 2019, more than 10 new rice mills came on stream in Nigeria, while many of the existing mills have expanded their capacity; www.businessday.ng

President Muhammadu Buhari

several new ones are under construction,” it said.

It also said that more than a billion dollars of private sector investments in the production of rice, wheat, sugar, and poultry, animal feed, fertilizers, etc, since 2015.

The Federal Executive Council also gave approval (2020) for a national agriculture mechanisation programme, “the Green Imperative”, in partnership with the government of Brazil and multilateral financing institutions.”

The Presidency also claimed that its ‘Fertilizer Initiative’ launched in January 2017 as a government-to-government agreement with the Kingdom of Morocco, is really paying off.

According to the document, more than a million metric tonnes of fertilizer have been produced since 2017, translating into distribution of more than 18 million 50kg bags of NPK fertilizer in the first three years of the PFI).

“Also, 22 blending plants resuscitated with combined installed capacity of more than 2.5m MT, while there is price reduction from 9,000-11,000 per bag, to 5,500,” it said.

The Presidency said that it has done a lot in making businesses work, by initiating several supports for Micro, Small and Medium Enterprises, while launching a series of funding and capacity development initiatives designed to support MSMEs. “The new Development Bank of Nigeria (DBN) has finally taken off, with initial funding of US$1.3 billion (N396.5 billion); to provide medium and long-term loans to MSMEs. Since 2017, the DBN has disbursed a total of N100 billion through the bank’s 27 Participating Financial Institutions (PFIs) impacting more than 100,000 MSMEs. “Also, 52percent of loans disbursed in 2019 were to

youths and women-owned businesses. Bank of Industry has disbursed more than N400 billion in loans to large, medium, small and micro enterprises since 2016,” the document said.

Other initiatives include, establishment of a N5billion Fund for artisanal miners, as part of the federal Ministry of Mines and Solid Minerals Development’s Programme to boost mining activities in Nigeria; as well as a $20 million Fund to support young technology entrepreneurs in Nigeria “The MSME Clinics, which brings relevant government agencies together with small businesses operating in various cities across the country, to enable the agencies, provide direct support to these businesses. The interactions allow the agencies better understand the issues facing small businesses, and provide a platform for speedy resolution,” it further said.

The Presidency says that its reforms in the area of ‘On Ease of Doing Business’, has been a success.

The work of the Presidential Enabling Business Environment Council which was inaugurated by President Buhari in August 2016 and the Enabling Business Environment Secretariat (EBES) has resulted in “Nigeria moving up 39 places on the World Bank’s Ease of Doing Business rankings since 2016. And in the last three years, Nigeria has twice been adjudged one of 10 Most Improved Economies in the Rankings.”

It also noted that the Nigerian Investment Promotion Council (NIPC) in 2017completed a long-overdue revision of the list of activities that can benefit from Nigeria’s pioneer status incentive, which grants beneficiary companies a three to five-year tax holiday. The revision, done more than 10

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years after the last one, has modernised the list, expanding the tax holiday incentives to qualifying companies in E-commerce, Software Development, Animation, Music, Film and TV. “NIPC published a compendium of all Investment incentives in Nigeria, making it easier for existing and potential investors to have equal access to the information,” it said.

In the area of solving the perennial problems of pension payment in the country, President Buhari in January 2019 launched Nigeria’s Micro Pension Scheme which allows self-employed persons and persons working in organisations with less than three employees to save for the provision of pension at retirement or incapacitation.

“The Buhari’s administration is prioritising the payment of pension arrears owed staff of current and privatised/ defunct Federal agencies.N54 billion was released to settle outstanding 33percent pension arrears (the 33percent pension arrears date back to 2010 when the minimum wage was increased to N18,000),” the document said.

It further explained that the Delta Steel Company (liquidated in 2005): 3,542 pensioners have now been placed on the payroll, ending a 13-year wait for their entitlements. In NITEL, 9,216 pensioners are now pay rolled, after more than a decade of neglect.

It also said that the Retired Biafran Police Officers, dismissed by the Federal Government in 1971, after the Civil War ended, and pardoned by President Olusegun Obasanjo in 2000, were paid their pensions, approved by President Buhari. It recalled that about N571.56 million was paid to a total of 174 beneficiaries in October 2017.

“In Nigeria Airways, President Buhari approved the release of N24 billion in September 2018, for the settlement of 50percent of workers disengaged when the airline was liquidated in 2003/4,” it said.

Other areas of reforms said to have recorded huge successes include ‘Monetary, Fiscal, Trade, Immigration and Consumer Protection.’

It noted that the administration launched a new Tax Identification Number (TIN) Registration System in 2019.

“For the first-time Nigeria has a consolidated, unified database of all taxpayers (individual and corporate), across all states. This new system is the product of increased collaboration between FIRS and States’ Inland Revenue Services (through improved sharing of infor@Businessdayng

mation, and an integration of databases, among others) “The new TIN Registration system leverages on existing taxpayer data available from databases of multiple organisations like Corporate Affairs Commission (CAC), Banks through Bank Verification Number (BVN), National Identity Card Management Commission (NIMC) and others,” the document said.

In the area of transport, power and health infra­ structure, it said: “Three major rail projects inher­ited from previous administrations have been completed and commis­ sioned: Abuja Metro Rail and the Abuja-Kaduna Rail, and the 327km Itakpe-Ajaokuta-Warri Rail, start­ed in 1987, have been completed in 2020. A fourth Rail Project, the La­gos-Ibadan Rail Project, kicked off in 2017, and is due to be completed in 2020. The tracklaying for the main component of the project was com­pleted in March 2020”.

According to the documents, “In May 2018, the Federal Gov­ernment launched the Presidential Infrastructure Development Fund (PIDF), under the management of the Nigerian Sovereign Investment Authority. The PIDF kicked off with seed funding of US$650 million, and has already disbursed funds for three critical road projects: Second Niger Bridge, LagosIbadan Expressway, and the Abuja-Kaduna-Zaria-Kano Expressway. Nigeria Sovereign In­vestment Authority (NSIA) in March 2018 invested US$11m to establish a world-class Cancer Treatment Cen­ter at the Lagos University Teaching Hospital (LUTH), which commenced operations in 2019”.

“Work is ongoing on two US$5m Diagnostic Centres in the Aminu Kano University Teaching Hospi­tal and the Federal Medical Centre, Umuahia. Abuja’s Light Rail system has been completed; it connects the city center with the Airport, and the AbujaKaduna Railway Line.

“New Abuja and Port Harcourt Internation­al Airport Terminals completed, in Q4 2018. New Lagos and Kano Interna­tional Airport Terminals scheduled for completion in 2020. All were inher­ ited from the previous administration at various stages of completion, and in some cases required project rede­ sign and revision. The Buhari Ad­ministration successfully completed the reconstruction of the Abuja Air­port runway within the scheduled sixweek period (March – April 2017), and will complete the reconstruction of the Enugu International Airport Runway in 2020,” it further stated.

Tuesday 09 June 2020

BUSINESS DAY

25

Dealing with personal loss while navigating chaotic markets The longtime head of Jefferies was set for 2020 to be a celebratory year LAURA NOONAN

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efferies entered 2020 with record quarterly earnings, setting chief executive Rich Handler on course for a celebration to mark his 20th year at the helm of one of the world’s biggest independent investment banks.

Within weeks of closing that quarter on February 29, New Yorkbased Jefferies was navigating chaotic markets from hastily-created home offices as its hometown became the pandemic’s epicentre and global economies lurched towards recession.

Then, coronavirus claimed the life of Mr Handler’s longtime finance chief Peg Broadbent, who was just 56, a shock made worse by the inability to properly grieve “a great partner to all of us” because of lockdown restrictions.

Mr Handler, 59, who professes to be more interested in doing his job than talking about it but has amassed 22,600 followers on Instagram, does not consider the past few months the toughest in his career.

That honour falls to times when he or his company were more uniquely afflicted, such as in 2011, when Jefferies was falsely accused of having the same sovereign debt problems as those that tipped futures and options broker-dealer MF Global over the edge, or in 1990, when the collapse of investment bank Drexel cost Mr Handler his job just as he was about to become a father.

Mr Handler, who grew up in New Jersey and studied at the University of Rochester and then Stanford, says he views the current environment with a mixture of “incredible sadness” for the misery wrought by the pandemic and the protests against racism sweeping through the US, and optimism about the world’s capacity — and his bank’s capacity — to rally.

He talks about the sadness mostly in terms of what the world is going through, but there is undoubtedly a personal edge. Last week, Jefferies raised $9.25m in Broadbent’s honour through a charity day where trading commissions and donations from staff and the firm were channelled to almost 90 mostly smaller groups assisting with coronavirus relief.

“When you have someone who

passes from coronavirus, there’s no funeral, there’s no real closure, there’s no service, at least not for a while,” says Mr Handler over a Zoom call from the Westchester County estate where he is waiting out the pandemic with his wife and four children.

“For those who wanted to honour Peg, this was a good chance for them to do it in a positive manner by doing good. But it still doesn’t take away from the fact that you never really have a chance to grieve for somebody.”

Mr Handler sees a long path ahead for the country at large as well, demanding a health solution for the virus, a “real change in racial relations” and global partnership to replace the “isolationism” of recent years. “It’s going to take . . . some sacrifice, which means probably higher taxes,” he says. “I’m an optimist that [recovery] will happen, it’s just going to take time and a lot of work and co-operation.”

As for the bank, in a recent staff memo Mr Handler and his president Brian Friedman wrote that their hopes of a special year were still “intact”, a reference to their goal of record annual profits in 2020.

“We wouldn’t have said that . . . if we didn’t really rally well in the last two months, gain a lot of market share, help our clients in a significant way, and really perform well internally,” he says.

He and Mr Friedman have been driving performance by communicating exhaustively with staff since they were scattered to the four winds in March.

Written dispatches include thanking staff for working “tirelessly”, circulating scientific material on the virus and expressing www.businessday.ng

their shared “heartbreak” at the killing of African-American George Floyd by a white police officer and the protests that followed across the US. In one memo, Mr Handler writes in bold that staff should “completely forget the markets and all work issues” over the three-day Easter weekend, somewhat surprising advice from a man who says he’s worked most weekends for the past 30 years and is so steeped in the bank he wears a Jefferies T-shirt at his home office and has a Jefferies baseball cap positioned on his book case, in his webcam’s eye line.

Mr Handler stresses that balance is important — indeed, that’s part of the purpose of his Instagram account, where he uses pictures of him and his family at laser tag or doing puzzles to show the younger generation that finance CEOs are “real people . . . they have families and kids and they don’t take themselves too seriously and can have fun”.

He also uses the social messaging platform as a forum to talk to a largely millennial audience about topics that resonate with them, such as diversity and advice on the importance of things such as “integrity, respect, humility and dedication”.

Courting young talent is important. Jefferies’ success in growing revenues by almost 40 per cent in the four years since 2007 came on the back of 2,000 new hires, a large number for a bank that has 4,000 staff. “We have been actively recruiting, interviewing and hiring people since the Covid crisis started”, Mr Handler says. “Difficult periods can be the best times to attract great talent.”

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Some have been recruited entirely over Zoom, several have come to Mr Handler’s estate in Westchester and done socially distant interviews outside.

He won’t say how many staff he wants to add — “I’ve never been able to do that or understand how people could do that because our world changes so much.”

It’s an apt comment, given that the world is arguably on the cusp of unprecedented change. JPMorgan chief executive Jamie Dimon recently said the crisis should be a “wake-up call” for an America where too many people have been left behind for too long.

That has uncomfortable implications for banks, who are the bastions of the current economic system, and people such as Mr Dimon and Mr Handler, who are paid many millions of dollars to run them.

The Jefferies boss argues that his bank is a positive force, helping companies raise money and manage it, while paying a “boatload of taxes” and “creating value” for shareholders and bondholders.

Jefferies made $7m of net profits when Mr Handler joined the bank in 1990. Last year, it made $415m.

“Are we doing God’s work?” he says, invoking the phrase that former Goldman Sachs boss Lloyd Blankfein was pilloried for coining in 2009. “No. I’m not saying that we deserve to be knighted. But I’m also not going to be embarrassed by what our industry has done.”

He disputes reports that he is Wall Street’s best-paid bank boss and argues that any conversation about income distribution after the pandemic must examine issues broader than finance or executive @Businessdayng

pay.

“It’s not an easy question — you can’t just wave a magic wand and say, ‘OK, I’ll redistribute my income from here to there’, and solve all the problems,” he says, describing the role of taxes, philanthropy and job creation in any solution.

Mr Handler says he has been told that empathy has been one of his “biggest advantages” throughout his career and that he has honed that further during this crisis, by helping his junior staff as they adjust to life where “everything is on hold”.

Still, Jefferies hasn’t followed bigger banks such as Goldman and Morgan Stanley by soothing staff with commitments not to make any lay-offs this year.

“You don’t make promises you can’t keep and you never know what’s going to happen in the future in our industry,” Mr Handler says. “What we have told people is that the thought of lay-offs hasn’t come up in even one of our senior conversations since the virus surfaced.”

That means that “if you were not a good performer before the crisis, nobody should think this virus will be good cover to continue not doing a good job,” he adds.

The message to most of his staff is more upbeat.

“We have told everyone to get to work and worry about things you can control like your work ethic, creativity, attitude, integrity and teamwork, and don’t worry about the nonsense that you can’t control,” he says.

“If we all do that, we will continue on and have a very good year, despite the challenges and volatility in the markets.”

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Tuesday 09 June 2020

BUSINESS DAY

‘Video is fine’: venture capitalists find the benefits in digital due diligence Investors believe remote tours could level playing field for entrepreneurs E M I K O T E R A Z O N O , R YA N MCMORROW AND MILES KRUPPA

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tephan Dolezalek recently sat in his house in San Francisco watching a video feed from a camera mounted on a hard hat.

The executive director of the agritech investment firm Wheatsheaf was getting an hour-long tour of a facility as he did his due diligence on a promising start-up.

From Zoom team meetings to video site visits, some of the venture capitalists who are still doing deals during the coronavirus pandemic say that many of these practices have made their jobs more efficient and are here to stay.

“The question we never really asked ourselves in the past was: ‘If I do this by video rather than getting on a six-hour plane flight, how much money and time do I save and what do I get less of than I would have gotten in person?’” said Mr Dolezalek. “In 12 to 24 months from now, and at least some of the time, the answer will be ‘Video is fine’,” he added.

In Beijing, Philip Beck, an angel investor and fundraiser, said that while the official lockdown has ended, most people still prefer video meetings using Zoom or DingTalk, another video app, to face-toface meetings.

Due diligence has sped up by about 25 per cent, he added.

In the past, investors typically spent about two weeks with a start-up to understand its business. But now people “are probably saying no more quickly”, he said.

We are not going to invest in a company without meeting the team directly Niccolo Manzoni, Five Seasons Ventures That also reflects increasing caution around new investments in the current climate.

While first-quarter VC

Video-conferencing from home has proved remarkably effective © AFP via Getty Images

investments were steady at €8.2bn in Europe and $34.2bn in the US, Nalin Patel, an analyst at data provider PitchBook, said he expected dealmaking “to slow considerably in the next two quarters” and that VC firms were focusing on investing in their existing portfolio companies rather than searching for new start-ups.

Many VCs said face-to-face meetings remain important.

Niccolo Manzoni at Parisbased Five Seasons Ventures said: “We are not going to invest in a company without meeting the team directly.

‘‘

We are not going to invest in a company without meeting the team directly www.businessday.ng

The deals we are closing are conversations which started [earlier].”

Duan Lanchun, an investor at Cathay Capital in Shanghai, said her team had restarted office visits at start-ups while wearing face masks and taking along lots of hand sanitiser.

“Investing takes trust, so if you don’t go meet someone in person it’s hard to get a sense of them,” said Ms Duan, adding they had made frequent visits and even stayed two or three days before finalising an investment.

Some investors said they were holding meetings in parks and other open spaces where they could have private conversations while social distancing.

But other VCs said that digital due diligence could provide a level playing field for entrepreneurs who are not located near a tech cluster or a big city where financiers congregate.

Steve Case, the former

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chairman of AOL who chairs VC fund Revolution based in Washington DC, said the pandemic and the new due diligence methods would prompt investors to look beyond the big hubs such as New York, Silicon Valley and Boston.

Revolution has a seed fund called Rise of the Rest that focuses on start-ups in emerging hubs. “[People] can be in Ohio, Pennsylvania, Virginia, Illinois, Indiana, Texas and Florida. It shouldn’t matter whether you’re three blocks away, three miles or 3,000 miles away.” he said.

“Covid-19 is the best thing in the long run for entrepreneurs and start-ups. Silicon Valley has, in the way it’s structured, a typically 90-mile radius from the Bay area,” said Rob Leclerc of AgFunder, an online funding platform. “[VCs] are now forced to do virtual DDs. This expands the global footprint [and] creates opportunities for investing all over the world,” he added. @Businessdayng

Mr Dolezalek said that while he missed opportunities such as driving over to a start-up’s car park in the evening to see who was still in the office and to check how hard they worked, he welcomed videoconferencing with people who were usually at home.

Wheatsheaf has just completed an investment done entirely through digital due diligence during the lockdown.

Using their local contacts including business executives and fellow VCs they trust, they recently invested in a Dublinbased start-up.

He doubted digital platforms could completely replace face-to-face networking but said they could help new entrepreneurs and start-ups who were located away from the VC hubs. He said: “Can remote companies and investors close the gap in playing fields? Probably yes, particularly if they get really good at leveraging these new communication tools.”

Tuesday 09 June, 2020

BUSINESS DAY

27

Media business

MultiChoice: Assessing price intervention in free market economy In recent time, private organisations such as MultiChoice have faced operational interventions from some authorities with intention to fix prices. Daniel Obi looks at the dangers of controlling prices especially for non- essential services in a free market economy like Nigeria.

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t is worrisome when some Nigerian consumers sometimes display seemingly strong aversion for other people or establishments without justifiable excuses. For instance, in early January 2012, a protest ‘Occupy Nigeria’, a socio-political protest erupted against planned fuel subsidy removal by the Federal Government of former President Goodluck Jonathan. The protest lasted for more than a week, disrupting socio-economic activities.

The government was to peg fuel price at N97 from N65.

On assumption of office, the present government of Muhammadu Buhari saw the same economic need to increase fuel price and equally effected it to N145 per liter and there was calm everywhere.

Similarly, in January this year, Buhari- led government approved VAT increase from 5% to 7.5% with implementation date effective February 1, 2020. This was with the intention to boost government revenue. In response to this, various organisations raised their VAT charges by 2.5 percent to 7.5% as government expects same tax returns.

In consideration of the plight of Nigerians who are living under increased economic pressure and want to make every Naira they spend count, MultiChoice, operators

of DStv did not implement the increased VAT immediately.

It absorbed the additional increase of 2.5% in VAT for the past four months, keeping its products and services at the old 5% rate.

In mid- May, 2020, the pay TV company decided the effect the VAT increase after weighing the cost on its operations. The company subsequently announced to its subscribers that it cannot continue to bear the 2.5% cost hence it planned to effect the VAT increase like other organisations on its services by June 1, 2020.

The decision did not go down well with some Nigerians as some subscribers understood it to mean new price increase. Other Nigerians really saw the action

by MultiChoic to effect the VAT increase as necessary but questioned the timing as it was when the effects of Covid-19 were ravaging businesses and having toll on individuals and families’ wallet.

In its intervention, House of Representatives who was part of the 2.5% VAT increase by the Federal Government, surprisingly, according to a report, directed the management of MultiChoice to suspend the increment in all their cable packages.

According to the report, the decision by the House followed the adoption of a motion sponsored by Chinedu Ogah at the plenary presided

by Speaker Femi Gbajabiamila.

Ogah, while moving the motion expressed concern

over the sudden increment of fees on subscriptions knowing the challenges faced by Nigerians as a result of the coronavirus pandemic in the country.

But Lynda Ikpeazu, another law maker, according to the report opposed the idea as she made fruitless effort to stall the motion arguing that MultiChoice must not be compelled to reduce charges since it is a private organisation operating under a free market economy.

Here, it was clear that the arguments were based on emotion and principles of economics.

Apparently, Nigerian law makers and other stakeholders must be commended for various decisions to protect Nigerian consumers and the state from arbitrage; however it is significant to underscore the effects of price fixing by fiat whenever it is proposed in a free market economy.

Clearly, determining of market prices through the dynamic interaction of supply and demand is the basic building block of economics, according to Fiona M. Scott Morton, associate professor of economics and strategy at Yale University. This dynamic interaction produces an equilibrium market price.

Therefore, “when prices are held below natural levels, resources such as talent and

investor capital leave an industry to seek a better return elsewhere. This means that there will be less discovery and innovation”. A country with high unemployment rate will naturally not allow this to happen.

On the other hand, when price is too high, there is an excessive amount of the product for sale compared to what consumers want, says Morton.

This equally has its economic consequences.

According to the economist, consumer preferences for a product or service determine how much of it they will buy at any given price.

“Consumers will purchase more of a product as its price declines... in general, if consumers appear willing to pay higher prices for a product, then more manufacturers will try to produce the product, will increase their production capacity” In the case of MultiChoice, restraining the organisation from increasing its subscription rates whether for VAT or economic dictates, according to experts has evoked strong debates on free enterprise.

Fixing price must therefore not be subjected to emotional considerations as doing that negates the principles of economics and it will likely produce consequences for either consumers, manufacturers or

Nielsen Webinar offers solutions on how businesses can navigate Covid-19 period

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n average global consumer is today displaying different attitude to consumption and purchase pattern as a result of Covid-19 pandemic which has also upended various sectors. This is largely informed by the pandemic implications on businesses and wallet and the need for consumers to stay safe by staying at home.

It is therefore important for consumer companies to understand these shifts in different product and services categories to enable their distribution planning, segment targeting and effective marketing strategies. This understanding informed the Nielsen recent Webinar. Nielsen is a global provider of consumer research and analysis Speaking during the We-

binar, Ailsa Wing, Executive Director, Thought Leadership, Nielsen Global Markets, who spoke on what the future horizons look like and how companies can navigate forward based on the changing scenarios said that companies must therefore re-consider and plan on how to solve and adapt to future dynamic conditions propped by Covid-19.

She said at the Webinar entitled ‘Life beyond Covid-19: Rebound, Reboot and Reinvent’ that conditions and consumer behaviours require different business strategies.

For economies to rebound, reboot or reinvent, it depends on the severity of the effect of the pandemic and the strategies applied by business managers and the government.

She said partial impact of the pandemic on certain econwww.businessday.ng

omies will enable economic rebound, while exacerbated consequence will cause economies to reboot and intense shocks will cause reinvention in economies affected.

For countries to move, government needs to assist with a multi-dimensional and complex strategies and they need to balance and assume economic activity with the need to contain the virus and safe lives.

Also speaking during the

conference, Ged Nooy, managing director of Nielsen Nigeria agreed that the pandemic has come with some disruptions for industries and businesses.

It equally came with challenges and opportunities, he said.

Covid-19 impacts countries around the world as consumers have been forced to change their behaviours.

For the pandemic, there are unlikely to be any major solutions in the short term, so what next for businesses and consumers.

“As FMCG manufacturers and retailers reflect, rebuild and reconsider the orientation of their businesses and brands for the future, they will need to predicate their ecosystems and strategies upon a deep understanding of what economies and consumers have endured and how they will emerge”,

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Nooy further said.

According to Nooy, the market research company has looked at emerging scenarios that spans for the next 18 months. These are accelerated conditions where the pandemic continues to spread which requires accelerated response; mixed environment where the virus becomes manageable and certain conditions are lifted to rebuild the economy; where the virus naturally dies out and fourthly where vaccines are found. It is not sure whether the last factor is likely in the short term.

He predicted that there will be conditions and innovations based on the mixed scenarios as consumers are increasingly concerned about the virus and catching it with businesses and organisations readjusting as consumers attitude change. @Businessdayng

the economy.

Moreover, the services of entertainment organisation like MultiChoice are optional as they are not indispensable services.

This is not the first time MultiChoice will be in the eye of the storm over its operations especially attempts to fix prices for its products.

While it is commendable for Nigerians and concerned authorities to intervene or investigate organisations involved in arbitrary charges, subjective billing, ripping consumers through poor services or substandard products which they receive payments for, it is important for such authorities not to intervene in pricing, especially for non-essential products and allow this to be defined by market forces which are building blocks of any economy.

If the banking industry with lending interest rate at over 23% and other extra charges, the electricity sector and transport sector including airlines are closely monitored as the pay TV is dictated to, services could be affordable but the danger is that there may not be any establishment to provide the services. Therefore, market forces should be allowed to determine trends especially prices to allow for continuous provision of products and services for willing buyers.

APCON set to conduct PDA examinations

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n line with its mandate to provide and refocus professional excellence for the marketing communications industry, the Advertising Practitioners Council of Nigeria, APCON, is set to conduct the May/June 2020 Professional Diploma in Advertising (PDA) examinations.

In a recent statement made available to BusinessDay, the Acting Registrar, Ijedi Iyoha said that “the exams previously set to hold on June 1 to June 5, 2020 could not take place due to the temporary suspension of our operations in compliance with Federal Government’s directive to curb the spread of Coronavirus by locking down the Federal Capital Territory, Abuja, Lagos and Ogun States, thus making us to reconsider this decision and move the date forward to Monday, June 22 to Friday, June 26, 2020”.

28

Tuesday 09 June, 2020

BUSINESS DAY

Branding

Dradrock, Tee A partnership: When values converge Globally, companies are in constant search for credible and believable ambassadors to give their brands a boost through propagation of positive narratives about the brands which will hopefully trigger consumer sales and increased brand equity. In signing ambassadors, firms go for knowledgeable celebrities with characteristics and values identifiable with their brands. This report therefore looks at the role of brand ambassadors as Dradrock, a foremost real estate firm recently signed Tee A to assist it expand its frontiers.

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hen properly handled, many business experts believe that there is some “domino effect” on consumers when credible stars use or recommend some products or services. Many marketing teams of product or service in companies sometimes have the convergence point of their campaigns or activities around one form of endorsement to enable a remarkable positive result, especially when that celebrity is highly respected.

In engaging brand ambassadors, companies much ensure that the personality is someone who embodies the brand and he or she is capable of influencing consumers and raising awareness about the brand.

Today, many brands are represented by ambassadors who are assisting to heighten the brand equity of the companies or products and also encouraging consumers open their wallets for the brands.

The fact that culture and popularity of stars are vital instruments in connecting to the heart of consumers must have motivated a Lagos based real estate development company, Dradrock Real Estate Limited to sign one of Nigeria’s leading comedians and television personality, Tee-A also known as ‘Babatunde Adewale, as a brand partner.

The contract signing ceremony that took place last week at the Dradrock’s corporate office in Lekki, Lagos was indeed a special one since the new face that will spread the message for Dradrock is a comedian, against the popular norm of musician or actor/ actress that have dominated brand ambassadorship in Nigeria in the last few decades. After the brief signing ceremony, Tee-A was formally presented to a select team of guests, top company officials, editors, and writers.

Speaking during the media chat, the MD/CEO of Dradrock Real Estate Limited, Oladipo Idowu-Agida expressed optimum satisfaction that the consummation of the brand partnership that has been in the pipeline for some time, has eventually become a reality with the public presentation. He carefully traced the touch-points of the company’s connection with Tee-A,

L-R: Oladipo Idowu-Agida, managing director/chief executive officer, Dradrock Real Estate Limited; Babatunde Adewale, New Brand Partner for the Company, (TEE -A) and Temitope Ayanbowale, the Human Capital Development manager of the company, at the signing of brand partnership and visit to one of the estate, Pacific Manor Lekki in Lagos.

which started as a client-customer relationship over a period before becoming the present brand partnership arrangement.

Explaining further, Idowu-Agida revealed that his organization had to dig deep in the research area to pick the ideal celebrity whose character is harmonious with the brand. He equally hinted that the existing relationship they had with Tee A helped his team of researchers to promptly identify those salient qualities Tee-A has that were congruent with the brand culture of Dradrock. His words, “Looking at all these, we all will agree that Tee-A will create a great impact in the minds of our target audience within the Nigerian and Diaspora market with his versatile personality profiles. Those salient qualities made him the ideal candidate to reach out to different facets of our consumers”.

The CEO of Dradrock further revealed that even before the formal signing, the two parties had shared lots of ideas on ways to provide real estate solutions in a very affordable plan that will attract investors into the industry.

Speaking on the challenges that real estate growth and expansion to all classes of people are facing in Nigeria, Idowu-Agida listed lack of affordability and www.businessday.ng

an underdeveloped mortgage system, among other problems.

According to him, “taking care of the middle and lower class is challenging because of these obstacles, so a bold initiative from government that provides a suitable environment for all types of mortgage institutions to thrive is critical if we must rapidly service the middle and lower class.

On this part, he said his organization is targeting first-time homeowners with very flexible payment options to help reduce the current housing deficit Nigeria is facing.

Speaking immediately after the formal signing of the partnership agreement, Tee-A described his relationship with Dradrock as one that has come a long way.

Although he is known more with comedy and entertainment, he acknowledged that he had been a real estate enthusiast for a long time. He said the partnership will not only attract goodwill to Dradrock but also strategic market targeting brand presence for equity as well. In his words: “This partnership will surely boost the position of the organization in the marketplace and strengthen the relationship that is quite valuable to all of us involved.”

Immediately after the public presentation, Idowu-Agida, led

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the brand partner, the media, and all team members present to Pacific Manor, one of the company’s new estate that is on the verge of completion.

The convoy arrived at Pacific Manor, a magnificent and spectacular piece of real estate luxury, and everyone admired the luxurious, serene and gated community located within Atlantic Nominees Estate in Lekki, Lagos. The estate sits in the heart of Lagos, just a 20 minutes’ drive from Four Points by Sheraton.

On hand to receive the visiting team to the unique estate that sits on 6,400sqm of dry land was the Project Manager, Olusola AyoSoyemi, and Babalola Salua, the site engineer.

As they led the Managing Director of the Dradrock, the Brand Partner, journalists, and others in a tour around the estate that was still under construction, the project manager explained that Pacific Manor residence is engineered with the highest possible standards using the raft foundation.’

A visibly elated Tee-A, in his first ‘ambassadorial’ duty in this brand partnership, was impressed with the high level of professionalism and quality pace of work at Pacific Manor. He spontaneously invited the public to come and @Businessdayng

experience a luxury lifestyle that Pacific Manor is poised to present in about eight months when virtually everything will be ready.

Pacific Manor has a total of three blocks of one bedroom apartment consisting of nine units in each block and nine blocks of a three bedroom terrace duplex consisting of four units in each block.

With such products in its kitty, Dradrock Real Estate Limited is emerging as one of the fastestgrowing real estate companies in Nigeria with interest in the residential and retail sectors.

Commenting on the possible strategic gains in Dradrock picking Tee A as Brand Partner, Emma Young, a researcher, and brand analyst, puts it succinctly, “people love characters. Characterization is the holy grail of great storytelling.

And if you are lucky to have one working for your brand like Tee A that Dradrock picked, you’d better recognize and keep it like gold.

There’s nothing as powerful as that cultural connection, humanness factor and synergy a brand and its partner display”.

Tee-A attended the University of Lagos Akoka Yaba Lagos, where he graduated in Linguistics. He later went to American Comedy Institute, ACI, New York.

He has organized popular shows like “Tyme Out With Tee-A” and has made a name for himself as a clean, corporate-friendly comedian and an entrepreneur, with several lucrative businesses across Nigeria and the West African sub-region.

Many times he has performed alongside other famous comedians, including AY, Alibaba, I Go Dye, Basketmouth, Gordons, and Bovi, among others.

Dradrock has within the space of 24 months of existence, sold out 2 estates with completed land allocation in Annapolis Garden Court 1 and 2. While its 4th estate the Prime Oikos is one of the most sorts after due to the high value it offers and its flexible payment plan. The company presently has its core operations in Lagos, but with extension plans to Abuja and Port-Harcourt in the near future.

Brand ambassadorship has become crucial marketing strategy for firms, especially in the dynamic and competitive environment. If well employed, brand ambassadors are tonic to product promotion.

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INTERVIEW ‘COVID-19 notwithstanding, SEPLAT remains resilient and true to its vision’ The year 2019 was a year of milestones for Seplat Petroleum Development Company Plc, from the successful Eland acquisition to the payout of $59million dividend to shareholders. The Chairman of the Company, Dr. ABC Orjiako, in this interview with Olusola Bello enumerated Seplat’s commitment to sustainable growth, innovation and value creation remains unwavering.

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generating jobs.

We have continued to produce oil and gas and at a maintained low cost oil production of about $6 per barrel of oil equivalent. These are the few of very many achievements that the company has been able record.

COVID-19 is something no one saw coming. What was your immediate response to it as a company?

The Safety and security of our staff and all our stakeholders is number one on our agenda. The first thing we did was to protect our staff. We did start a quarantine programme where all staff who traveled outside Nigeria were quarantined for 14 days before coming back to work, and this predated what is happening at the national level.

Even before the government declared closure of offices in Lagos and Abuja, we had taken a decision to close our offices. We reduced the number of staff we have at the fields to make sure that adequate social distancing was maintained, and also made sure that all of the requirements that the NCDC put in place were maintained.

Our Health, Safety and Environment (HSE) department is making sure that these are followed strictly. So, on that basis, we have maintained good safety and security of our staff.

In the areas where we operate, we take these stakeholders very seriously. We have made sure that despite the $1.2 million we contributed at the national level through the NNPC to fight spread of the coronavirus, we still went further to spend various amounts of funds in the states and communities where we operate to keep them safe. We have helped to strengthen supplies in the hospitals; we have also made sure that the communities received certain palliatives, with respect to food security during this difficult period; in addition to supplying them with very essential sanitation and hygiene materials.

What are your priority areas and business survival strategy given the state of the energy market at present?

With respect to 2020 challenges, one thing I highlighted to shareholders was the area of prioritizing our gas monetization. Even before COVID-19, we made sure that our priority www.businessday.ng

ABC Orjiako

was to commercialize gas for the long term, and this is for many reasons; The first is that we are committed to identify with the Federal Government in terms of closing the gap in power infrastructure. As a result, we have invested heavily in gas, and today Seplat is happy to say that we provide 30percent of gas to power in Nigeria, and still growing. We are supporting the government and the people of Nigeria in making sure that the narrative of the diversification of the economy is built on the platform of growth in power infrastructure. At present, statistics show that off grid power supply in homes through gas, diesel and petrol generators is accounting for as high as 20 gigawatts of power.

That tells you that the level of pollution in our environment is very high. Seplat will continue to contribute to cleaner energy from its gas supply.

Also it is important to note that our gas supply will power the industries, support SMEs and create jobs on a continuous basis.

The other point of course is that gas is lucrative in the domestic market and is a significant contributor to our revenue base. The contribution of

gas to our revenue is increasing year-on-year and we expect to see this continue to increase as the volatility in global oil price

‘

We have made sure that despite the $1.2 million we contributed at the national level through the NNPC to fight spread of the coronavirus, we still went further to spend various amounts of funds in the states and communities where we operate to keep them safe

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The year 2019 was an interesting year, what factors will drive the oil and gas industry in 2020? umber one is cost sensitivity.

Any company that would like to survive in the oil and gas industry going forward will have to be a low-cost producer of oil. This is because, the oil has become a marginal business, the price volatility will continue, therefore, only the companies that are able to continue to produce at low cost can thrive.

Another important area is that the world is changing, along with climate change advocacy which means that the narrative of cleaner energy is real, and that is why we are emphasizing our gas business.

Over and above that, we also keep very close eyes on everything that will make us reduce the level of carbon emission into the environment. We will also be ensuring very well and solid social impact in our businesses by encouraging gas to power initiatives, supporting SMEs and job creation through our gas commercialization.

Other drivers of the oil and gas business depend largely on the global supply /demand balance. The market requires demand recovery to become balanced.

Highlight some of the achievements of Seplat in 2019?

The achievements of Seplat are very many, but I will highlight a few of them. We remained profitable as a company, we have continued to be cash generative, a very strong revenue earner, we have also remained profitable. Profit after tax of $277 million is quite remarkable; and at the back of that, we have maintained very healthy cash balances. We have maintained payment of dividend which is very good return to our investors. We have of course continued to be very good corporate citizens.

We have paid huge sums of money in taxes and royalties to the Federal and State Governments. Our very well acclaimed Corporate Social Responsibility (CSR) programmes are ongoing and growing especially in areas where we operate, but also in Nigeria as a whole. We have also continued to maintain a very healthy workforce while

persists.

We are going to leverage on all of these stated factors and make sure that we would not only survive this trying period, but will remain positive in performance indicators.

Do you envisage further acquisitions in the near future?

We have not changed from our very long-term plan and strategy. We are continuously looking at acquisition opportunities. We concluded a very successful acquisition last year, despite the collapse of oil price globally and despite the hardship in the global economy.

We remain focused on acquisitions. we have continuously said that we are very committed to price sensitive acquisitions. That means, we do not overpay. So, as the industry changes, it means that the prices that buyers are willing to pay will continue to change and we would adapt and continue to do our acquisitions.

The real reason for us to continuously stress the strength of our balance sheet as well as our free cash flow is because it puts us in an advantageous position. We have a major competitive advantage as a result of this because Seplat, being that we are dually listed in the Nigerian Stock Exchange (NSE) as well as the London Stock Exchange(LSE) means that we have access to global investible capital. That is why you will see that our cost of borrowing is one of the lowest among peers; our access to new investible capital in terms of equity is very strong. At the back of all of these, free cash, strong and robust balance sheet, availability of internationally investible capital, we have a strong competitive advantage to play in the consolidation market as well as acquisitions.

Having had a successful AGM what is the state of Seplat in terms of CSR? You would have seen that over the years from inception, we spend a tremendous amount of time and resources in communities. In the communities where we operate, you will notice that in terms of our CSR programmes, we focus in a number of areas: Number one is Education.

We believe that solving the problem of education is one major step towards the eman@Businessdayng

cipation of any economy.

Therefore, we have been running scholarship programmes for universities because we believe that if we produce very good university graduates, and better employable Nigerian youths, then we have empowered them.

Secondly, in health, we have focused over the years on child and maternal health, and therefore, the ‘Safe Motherhood’ programme of Seplat is next to none, where tens of thousands of pregnant women are treated, and this is mainly addressing the very high mortality rate in terms of maternal health and infant health. This has paid off, we have spent a lot of time to provide them the amenities they require to make sure that throughout their antenatal period, they remain safe.

Another very important area that we have covered is that of sight. We realized that sight is a major challenge in our environment, so we launched the ‘Eye Can See’ programme, where we have again reached out to several tens of thousands of Nigerians, especially in areas where we operate, and this is very prominent.

In areas where we operate, we decided that it is important to empower people, so we run various skill acquisition programmes, we train people, employ them when possible, and make sure that they are well represented in areas where we work.

The other thing we have also done is to make sure that people in areas where we operate are significant in our number of contractors. So, we train them as contractors; we teach them the skills and make sure they participate while following our laid down procedures and processes; so, you are now beginning to see contractors from our areas of operation who are now retrained to provide various kinds of services.

This is a very important aspect of empowerment that we give in these areas and of course we are seeing quite several youths being employed.

We provide social amenities: water supply, electricity supply, road network, in the areas where we operate such that we have enjoyed a good working relationship in all these areas.

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Tuesday 09 June 2020

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BDTECH

In association with

E-mail: jumoke.akiyode@businessdayonline.com

Three Nigerian startups qualify for AfriTech 2020 online final

... Develop innovative tech solutions for healthcare industry Jumoke Akiyode Lawanson

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igeria has three of its thriving tech startups selected as part of 11 finalists to pitch and compete at Sanofi’s AfricaTech challenge holding online on June 11, 2020. This is following the cancellation of the 2020 edition of Viva Technology organised

by Sanofi.

This being the third edition of the tech startup competition, Sanofi says it received 268 applications, up from 222 last year, from 34 different countries. 11 finalists were selected, based on five criteria: project maturity, early results, relevance of the solution, market potential and business model, as well as the skills and expertise of the team.

The company says that the objective is to continue Sanofi’s commitment to encourage innovation in Africa, improve access to healthcare and transform the health ecosystem throughout the continent.

At the finals, three start-ups (namely Bypa-ss of Egypt, Keeplyna of Tunisia and EYONE of Senegal) are tasked with the first challenge : ‘How to support patients with a digital health book in order to access

information and make decision.’

The second challenge; ‘How to help healthcare systems leapfrog from manual to smart logistics solutions at point of care’, has a Nigerian start-up, Mobilhealth International and an Indian start-up, Doctor 4 Africa pitching.

Another Nigerian start-up, SOSO

CARE will compete against MamaPrime of Kenya and JokkoSanté of Senegal in the challenge: ‘How to improve financing and impact of innovative health solutions in Africa’.

Natal Cares of Nigeria, Teheca of Uganda and The University Agency Innovation of Cameroun are tasked with the challenge: ‘How to improve

maternal and neonatal health in sub-Saharan Africa.’

At the 2020 AfricaTech live virtual pitch, these startups will compete in their respective challenge categories before an online audience and a jury made up of global professionals, investors and thought leaders in technology and healthcare.

Folake Odediran, Sanofi’s general manager, general medicines, Nigeria & Ghana and country lead, Nigeria, commenting on the upcoming live pitch, said: “The AfricaTech initiative is in line with our purpose of empowering lives. We are so far impressed with the progress of the 2020 Challenge and are happy for all the finalists who have made it this far. We are even more excited that three of them emerged from our Nigeria-Ghana affiliate and we hope that the best techpreneurs win.”

After Viva Technology 2020 was cancelled due to the COVID-19 pandemic, the selected startups will now be invited to pitch their solutions at 2:00pm CET (Paris time) on June 11, 2020, during a special Sanofi Africatech day by video conference.

The live virtual event will be hosted by Sanofi Africa zone and will comprise of four pitch sessions, each of 30 – 45 minutes duration.

Attendance is open to external audiences through prior registration on the Sanofi website.

The four winning startups will be announced at the end of this event, and Sanofi will then evaluate longer-term partnership opportunities with the winners.

Bolt improves safety measures: Introduces ‘Bolt Protect’ in Nigeria Jumoke Akiyode Lawanson

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olt, popular on-demand transportation platform in Africa, has introduced a new ride-type in its platform dubbed ‘Bolt Protect’ as a measure to protect passengers and drivers against the spread of COVID-19 virus.

Bolt recently revealed that ve-

hicles under this new category will be fitted with protective plastic film of nylon installed between the passenger and driver seats acting as a precautionary barrier that limits the airflows between the driver and passengers thus reduces the possibility of the virus spreading through droplets expelled by sneezes or coughs from an infected person.

Speaking on the launch of Bolt

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Protect, Femi Akin-Laguda, the country manager for Bolt Nigeria, said; “The safety and well-being of our riders and drivers is paramount to us. Yet, even during the virus outbreak, some people still need to move around in the city and we are doing our best to fulfil our mission and help them do so.”

“However, we strongly advise all our drivers and passengers to

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follow the advice of the Nigerian Centre for Disease Control (NCDC) and to take the necessary health measures,” he said.

Bolt Protect is currently available to Bolt customers in Lagos and Abuja, with plans to expand to more cities soon. Passengers are able to choose the new ride-type when they order a car in the Bolt app and will not pay an extra fare since the

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new category does not attract an additional base fare. The number of passengers in the new category is limited to two passengers per vehicle as mandated by government directives.

According to the company, other Bolt services will still be available to customers at the same affordable rates in the eleven locations across Nigeria where Bolt currently operates.

Tuesday 09 June 2020

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BDTECH

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E-mail: jumoke.akiyode@businessdayonline.com

2G/3G sunsetting and migration to 4G Philip Kendall

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ccording to new wireless market forecasts, at the start of this year 2020, 2G and 3G networks accounted for 46 percent of subscribers but just 27 percent of revenue globally. By 2023 that revenue share will have fallen to just 10 percent, with Africa arguably the only significant outlier here, a region where countries can have average revenue per user (ARPUs) below $2 and very limited room to subsidize user behavior change.

There are, however, significant developments happening in Africa and other developing regions to accelerate the adoption of 4G services, and some encouraging results from those efforts. For example, Airtel Africa’s 4G network expansion and “more for more” data offers have helped with migration to 4G, increasing average data use and data ARPUs significantly, with ¾ of its revenue growth coming from data over the last year: in March 2020, 4G accounted for 29 percent of its data subscribers (up from 18 percent a year earlier) and for over 60 percent of its data revenue.

2G or 3G network sunsetting is really building now Driving 4G migration is motivated by revenue upside opportunities as well as cost benefits in terms of spectral efficiency, operating expense (OPEX) and

capital expenditure (CAPEX) burdens of running multiple radio technologies, as well as issues that are amplified as operators also begin to add 5G into the mix, such as a need to meet electromotive force (EMF) limits or just physically having enough space on a cell site or tower to place 2G, 3G, 4G and 5G equipment.

2G or 3G network sunsetting is really building now. This is most advanced in America and developed Asia-Pacific markets, though there is a growing list of operators worldwide timetabling the sunsetting of 2G or 3G or both. This includes Airtel India’s phased regional switch off of 3G as that market swings rapidly to 4G under Jio’s disruptive influence, VodafoneZiggo turning off 3G in February in the Netherlands, Telia and Telenor’s network JV in Denmark TT-Netvaerket phasing out 3G from April 2021, and Vodafone’s CTO talking about switch-

ing off 3G across Europe by 2022 at a recent Vodafone Business analyst event. Migrating 3G to 4G is arguably slightly easier in that you are convincing someone who at some point bought a 3G smartphone that they need a 4G one, rather than trying to convince someone with an old 2G feature phone of the same.

For 2G, there are also often longer term network plans, typically linked to legacy IOT operations, with a focus here on perhaps closing 2G handset services and thinning down spectrum resources used in a 2G internet of things (IOT) network.

In Africa, we should also consider the importance of 2G for unstructured supplementary serviced data (USSD) for mobile money transactions, which represent a significant revenue stream for some operators.

Entry-level phones are key to accelerating user

migration Ultimately, any wholesale migration to 4G is dependent on value propositions that appeal to the lowest income segments of markets. These lowARPU segments may be sensitive to small sub-$5 variations between a 2G or 4G handset and that may be a gap that is too wide for an operator to be able to subsidize. Joyce Wang, a VP at KaiOS, talked about her company’s success in bringing low-cost 4G smart feature phones to market and strategy analytics view this as an important segment in developing markets.

Reliance Jio’s KaiOSbased JioPhones have been a huge success in India, extending its market reach to win 2G and 3G customers from its rivals and really setting the agenda for 4G’s increasing domination there.

There are also good examples of operators actively engaging with players in the handset value

chain to launch low-cost smartphones and smart feature phones. True Move in Thailand has made significant market share gains in recent years in part built on success with its affordable True Smart Series smartphone range, while in Indonesia, XL Axiata has brought in local electronics assemblers to produce smartphones such as the Evercoss Xtream range.

4G dominates XL’s data traffic profiles now and it has aggressive plans in 2020 to optimize its spectrum portfolio, “reducing the capacity and shutting down 2G and 3G sites in line with the reduction in traffic and free up the relevant spectrum for 4G to cater for the ever increasing 4G traffic.”

Operators are also looking beyond manufacture to all elements impacting the cost of handsets. Subsidies may be limited, though we are seeing other players willing to subsidize phones,

such as the retailer Alfamart subsidizing the WizPhone WP006 down to US$7 in Indonesia. Lowcost distribution strategies to extend operator reach into more rural communities have shown some effectiveness, such as MTN Nigeria’s assetlight partnership model, leaving partners in the distribution chain to procure and sell devices while MTN focuses on the SIM. Handset loans also represent an excellent way to improve affordability, syncing up well with the growing role for mobile money and micro-loans in developing markets. This was a message also given by KaiOS’s Joyce Wang, who talked through their plans for device loans.

These low-cost 4G device strategies could be improved in developing markets with more government efforts to reduce the tax burden on mobile phones and services (in terms of import duties and sales tax). Looking beyond pricing, operators also need to think carefully about actively managing the flow of new connections on 2G and 3G once a sunsetting timeline has been established, including both handsets and IOT devices, with the roll-out of VoLTE (and perhaps more importantly making VoLTE ‘default on’ on phones) an obvious pre-requisite there.

Philip Kendall is executive director of Strategy Analytics, a global, independent research and consulting firm.

StarTimes, MTN partner to provide movies, sports content via mobile Jumoke Akiyode-Lawanson

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igital Pay-TV company, StarTimes Nigeria has entered into a strategic digital content sharing partnership that provides MTN subscribers access to a wide range of interesting movies, series and sports via the StarTimes ON application platform.

Through this partnership, StarTimes will provide over 60+ live channels and

over 2000 video-on-demand (VoD) content to MTN subscribers using airtime to subscribe. Subscribers will also have access to discounted data bundles.

Speaking on this initiative, Tunde Aina, the chief operating officer, StarTimes Nigeria, said that, “With the video streaming bundles on the StarTimes App, MTN subscribers will enjoy unlimited entertainment and VoD services at a cheaper data price than any other network in Nigeria. www.businessday.ng

“We have My Sport VIP and MAX VIP streaming packages which can be subscribed to weekly, monthly or quarterly. My Sport VIP subscriptions cost N400 weekly, N1000 monthly and N2400 quarterly. The package comes with 7 sports channels including UEFA Europa League, Ligue 1, Bundesliga, MMA and many more.

“While the VIP MAX subscriptions cost just N800 weekly, N2000 monthly and N4800 quarterly. The package comes with 26 live

streaming channels which include all 7 sports channels showing UEFA Europa League, Bundesliga, Ligue 1, Coppa Italia and more; blockbuster movies, cartoon, news and documentary,” he explained.

“To enjoy discounted MTN data bundles to stream content, MTN is offering its mobile internet subscribers a special data bundle - StarTimes Streaming Only and StarTimes Binge. StarTimes Streaming Only provides data allocation to stream on

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StarTimes only while StarTimes Binge provides data allocation to access the internet and also an allocation to stream on StarTimes,” Aina said.

Srinivas Rao, the chief digital officer, digital services at MTN Nigeria, said; “We have always been deliberate about giving our customers the very best in digital content.”

“This partnership is a reinforcement of that commitment. This platform will provide enormous quality content and keep subscribers @Businessdayng

entertained. MTN customers can access StarTimes content via both the StarTimes ON App and MyMTN App,” he said.

StarTimes ON currently boasts of 5.5 million users in Nigeria and over 15million across Africa, making its partnership with MTN the latest in an industry where it has become a common trend for Telcos and video operators to partner towards effective delivery in a market where VOD and live streaming are on the rise.

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World Bank projects Nigerian economy to shrink by 3.2% in 2020

Explainer

Why scrapping of ECA falls short of solving Nigeria’s fiscal crisis … Says COVID-19 to plunge global economy into worst recession since World War II ... Sovereign wealth fund can play greater role … Analysts expect rebound in Q4 2020 as FG funds sustainability plan DIPO OLADEHINDE

HOPE MOSES-ASHIKE

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igeria, Africa’s largest economy and most populous country, is expected to shrink by 3.2 percent in 2020, the World Bank Group said in its June 2020 Global Economic Prospects on Monday.

This year’s contraction in activity is set to be the most severe in four decades and this is as a result of the unprecedented collapse in oil prices.

Ayodeji Ebo, managing director, Afrinvest Securities Limited, said the contraction of the Nigerian economy is not a surprise as major sectors have been impacted negatively due to the lockdown caused by the COVID-19 pandemic.

Beyond the impact of

COVID-19, he said the FX illiquidity can plunge Nigeria into more contraction if further prolonged, hence the CBN needs to improve liquidity and provide clearer direction.

“The FG is working to spend N2.3trn to fund its Economic Sustainability Plan. If this is implemented, we could see a rebound in Q4:2020 or early next year,” Ebo told BusinessDay on Monday.

The economy depends heavily on oil revenues, which represent over 80 percent of exports, about one-third of banking-sector credit, and one-half of general government revenues.

Faced with a twin shock, the country’s slump in activity has been compounded by measures to slow the do-

mestic spread of the virus – including closing of national and state borders, schools, and the temporary shutdown of markets.

The oil sector is projected to contract by 10.6 percent, while non-oil output will fall by 2.1 percent. The recovery in Nigeria is forecast to be moderate. Lower oil prices are expected to dent investor confidence, while the assumed fiscal adjustment to lower oil revenues and tighter borrowing conditions is expected to constrain public investment.

Emerging market and developing economies (EMDEs) are expected to shrink by 2.5 percent this year, their first contraction as a group in at least 60 years, the World Bank Group said.

Per capita incomes are expected to decline by 3.6 percent, which will tip millions of people into extreme poverty this year.

Ayodele Akinwunmi, relationship manager, investment banking at FSDH Merchant Bank Limited, said with the adverse implications of the COVID-19 pandemic on the global economy and the financial market, the forecast was expected.

However, he said there are opportunities for the emerging market and developing countries to take advantage of the current low interest rates and high liquidity in the global financial market to invest in critical sectors and infrastructures that will help countries to develop and recover faster post COVID-19.

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he call by Nigerian lawmakers for scrapping of the Excess Crude Account (ECA) might be legitimate.

However, doing that alone without recognising the importance of Nigerian Sovereign Wealth Fund will make the country float dangerously without a fiscal life jacket.

Unlike fellow oil exporter Saudi Arabia, which is financing a huge part of its deficit from its SAMA Foreign Reserves Holding while also toiling night and day to protect its unborn generation by either maximising potentials in oil sector or reducing aggregate risk to oil price, Nigeria is funding its budget deficit by record borrowings and seems not prepared for any rainy day.

The first attempt made to save money in Nigeria was the Excess Crude Account (ECA), which is simply a “spillover” savings account that accumulates the excess of the benchmark and the actual price of crude oil. Thus, if the benchmark price in the annual budget is $50 per barrel

and crude oil is sold for $70 during the year, $20 flows to the ECA. However, there is no federal law setting up the ECA. Just as the Petroleum Development Trust Fund and the Ecological Fund were raided and used for purposes outside of their stated objectives, fiscal recklessness has reached its pinnacle with the depletion of the ECA to a pitiable $71 million. Nigeria’s lawmakers, led by James Faleke, chairman, House of Representatives Committee on Finance, last week unanimously approved the scrapping of ECA, describing it as illegal.

According to the lawmakers, the Excess Crude Account has no backing of law and should be scrapped with immediate effect and in compliance with sections 80 and 81 of the 1999 Constitution of the Federal Republic of Nigeria, as amended.

Serially abused ECA The ECA, which states had particularly contended is illegal, has repeatedly faced a series of allegations of lack of accountability, lack of transparency, mismanagement and gross abuse.

How low-interest rates hold cheap finance cost, debt restructuring opportunity for companies … as MTN, UBA take lead ENDURANCE OKAFOR

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Nasir el-Rufai (r), governor, Kaduna State, welcomes Muhammed Sabo-Nanono (m), minister of agriculture and rural development, to the roll-out of seed distribution to farmers for the 2020 planting season, at the Livestock House, Mando in Kaduna.

FG’s planned N2.2trn local borrowing could trigger funding crisis for private sector ... Experts decry huge deficit, want FG to up revenue generation Cynthia Egboboh, Abuja

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igeria’s private sector faces an imminent funding crisis as the Federal Government plans to borrow as much as N2.188 trillion locally to fund the amended 2020 budget now put at N10.509 trillion.

The government’s review of the 2020 budget has led to a huge increase in deficit

by N2.736 trillion to N4.563 trillion, and experts are concerned that the increased domestic borrowing of N2.188 trillion would crowd out pri-

vate sector access to credit.

Eze Onyekpere, lead director, Centre for Social Justice, said the planned borrowing by government would crowd out the private sector as lenders would first attend to government debt instruments which have reduced risks before giving attention to private sector credit demands.

Obadiah Mailafia, former deputy governor, Central Bank of Nigeria (CBN), said the increased deficit is a great concern at this time as it has left the government with the options of either borrowing or cutting down some items in www.businessday.ng

the budget, thereby reducing the deficit.

“In tackling this deficit burden, it is either we keep borrowing or we reduce the deficit. By reducing the deficit, we will have to reduce the non-essential in the capital or recurrent expenditure,” he told BusinessDay. Mailafia further noted that the government’s borrowing is reaching an unsustainable level which is not good for the economy, especially when borrowings are being used to fund recurrent expenditures.

As contained in the revised 2020 budget, the defi-

cit financing of the revised N10.509 trillion would be partfinanced through domestic borrowing of N2.188 trillion and external borrowing of N1.984 trillion.

Patience Oniha, directorgeneral, Debt Management Office (DMO), confirmed recently that the proposed New Domestic Borrowing of N2.188.83 trillion would be raised from the domestic market through the issuance of Federal Government of Nigeria Bonds, FGN Savings Bonds, Sukuk, Nigerian Treasury Bills and possibly, Green Bond.

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igerian companies with plans to either raise cheap capital or readjust cost of finance may have it on a silver platter as the low interest rate environment presents such opportunities.

While interest rates in Nigeria have always been high due to the monetary system in vogue since 2009, which sought to use FGN bonds/Tbills and OMO bills as a means of attracting US dollars into the country to stabilise the naira, the recent OMO policy by the Central Bank (CBN) which prevents domestic investors from participating in the auction is the key driver of the low interest enjoyed today.

Yields on both T-bills and bonds instruments have hit a bottom record from a double interest rate enjoyed some four years ago, and according to industry analysts, the low yield environment is an opportunity ready to be tapped.

“It presents an opportunity for companies to raise cheap capital, and those that have existing bonds that were raised some twoorthreeyearsagowhenrates were about 15-18 percent can call the bond,” Yinka Ademuwa@Businessdayng

gun, research analyst at United Capital, said. Now is the time for companies to restructure their debt and lower finance cost to grow their bottom-line, he said.

United Bank for Africa (UBA) plc is one of the few Nigerian companies that have already taken a position to restructure its financing cost as it plans to redeem its bonds issued six years ago.

Rather than continue paying interest of 16.45 percent on its seven-year bonds, UBA plc said it would redeem its outstanding N30.5 billion bonds issued in December 2014 and due to mature December 2021 on June 30, 2020.

“This is positive for the bank duetothelowyieldenvironment,” saidAyodejiEbo,managingdirector, Afrinvest Securities Ltd. He interpreted the decision by the lender to mean “I have enough cash and I want to tap from the low-interest environment”.

With the decision by UBA to make an early call on its bonds, the commercial bank would be saving about 6 percent as the yield on a seven-year bond is currently at about 10 percent.

AyorindeAkinloye,aresearch analyst at CSL Stockbrokers, said Nigeria’s low yield environment also gives room for companies to raise cheap capital.

Tuesday 09 June 2020

BUSINESS DAY

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news Amidst scarcity, millions of meters rot at...

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some local assemblers say.

The enforcement of the levy on both imported components and manufactured meters is causing a pile-up of containers loaded with meter parts at the ports, which local assemblers say are in the millions.

Many have criticised a levy on meters in a country where 62 percent of electricity customers lack access to meters, but the situation could worsen as even parts to manufacture millions of meters have been stranded at the ports for months because local manufacturers consider the levy prohibitive.

“Nigerian Customs are the reason Nigerians are not getting meters today,” Chantel Abdul, managing director, Mojec International Limited, a local meter assembling outfit, said by phone.

Abdul said there are hundreds of cargoes of meter components for production stuck at the ports because the Nigerian Customs is demanding a 35 percent levy before they can clear them.

Joseph Attah, spokesman of the Nigerian Customs Service, however, said the agency was merely implementing the directive of the Nigerian government.

“Customs do not determine the tariffs,” Attah said.

Electricity customers who will in June begin paying additional 21 percent on the cost of single-phase meters and a 23 percent price increase for three-phase meters, according to new guidelines released by the Nigerian Electricity Regulatory Commission (NERC), will bear the brunt of inadequate meters.

In a letter to the DisCos and Meter Asset providers, NERC said the price of single-phase meters is now N44.896.17 rather than the previous N36,991.50,andcustomersapplying for three phase meters will now pay N82,855 instead of N67,055 due to the naira devaluation in March.

The Federal Government, as part of its importsubstitution programme, last year introduced a levy of 35 percent in addition to the 10 percent import duties charged on electricity meters with the objective of encouraging local production of meters, thereby creating jobs and growing the economy.

But the Nigerian Customs apparently did not get the memo as it is subjecting both manufactured meters and meter assembling components to the same 35 percent levy.

Interactions with Customs officials show that in

their view, merely importing the parts of a meter to assemble a finished product does not warrant an exemption, just as importing a car with a broken tail light does not grant it the designation of ‘accidented vehicle’ which attracts lower tariff.

Nigeria’s metering space comprises importers of meters, those who assemble Semi Knocked Down (SKD) components to assemble, and those who say they are Original Equipment Manufacturers (OEM) and develop their own software and hardware solutions.

“For us, COVID-19 and the movement restrictions have impacted our operations making it difficult to meet orders, but we are not affected by the levy since we manufacture our own meters,” said Yahaya Yahaya, company secretary, Momas Electricity Meters Manufacturing Company Ltd (MEMMCOL).

Strict enforcement of the levies on imported components and manufactured meter is causing a pile-up of containers loaded with meter parts at the ports while thousands of Nigerians each day express outrage on social media over the refusal of power distribution companies (DisCos) to meter them.

“If the government were serious about eliminating estimated billing, it would make an emergency proclamation removing duties on meter at least for a period of time,” said Chuks Nwani, an energy lawyer based in Lagos.

According to the latest report on the sector published

by NERC, the metering gap for end-use customers is still a key challenge in the industry.

“The records of the Commission indicate that, of the 10,374,597 registered electricity customers, only 3,918,322 (37.77 percent) have been metered as at the end of the fourth quarter of 2019. Thus, 62.37 percent of the registered electricity customers are still on estimated billing which has contributed to customer apathy towards payment for electricity,” the commission said.

In 2018, NERC began a Meter Asset Provider programme to allow third-party investors to provide meters for customers at a fee, but the levy and the foreign exchange challenges hamper the project.

According to NERC, only 22,825 end-use customers’ meters were installed during the fourth quarter of 2019, a significant fall from the 83,768 meters installed during the third quarter. www.businessday.ng

L-R: Mohammed Abdullahi, minister of state for science and technology; Ogbonnaya Onu, minister of science and technology; Shimon Ben-Shoshan, ambassador of the state of Israel to Nigeria, and Mohammed Bello-Umar, permanent secretary, Ministry of Science and Technology, during the visit of the ambassador to the minister’s office in Abuja, yesterday.

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587 of 979 Kano strange deaths linked to...

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navirus, the Federal Government said on Monday.

The government said this was part of the findings of investigations conducted by the Presidential Task Force (PTF) on COVID-19.

Osagie Ehanire, minister of health, said the report was coming almost two months after what was reported as ‘strange deaths’ ravaged the populated city, claiming lives of quite a number of its prominent citizens.

The number of strange deaths linked to COVID-19 in the city, about 587, almost doubles the number of coronavirus fatality in the entire country, at 354 as at midnight on Sunday.

“With regard to unexplained deaths in Kano which occurred in April, the team confirmed from graveyard records that a total of 979 deaths were recorded in eight municipal LGAs in the state at a rate of 43 deaths per day, with a peak in the second week of April,” Ehanire said at the daily briefing of the PTF in Abuja.

“By the beginning of May, the death rate had reduced to the 11 deaths per day it used to be. The verbal autopsy revealed that about 56 percent of deaths had occurred at home while 38 percent were in a hospital. With circumstantial evidence as all to go by, investigation suggests that between 50-60 percent of the deaths may have been triggered by or due to COVID-19, in the face of preexisting ailments.

Most fatalities were over 65 years of age,” he said.

Ehanire also said management of COVID-19

infected cases was being reviewed and improved, w i t h re v i s e d c l i n i c a l guidelines to be published in accordance with the learnings and evolving dynamics associated with COVID-19 and global best practices.

“This includes new discharge protocols, treatment regimen for asymptomatic or symptomatic cases with various clinical conditions. We continue to collaborate with states and the FCT with regard to their management of cases with provision of commodities, training and other technical support where needed,” he said.

Ehanire noted that the two-day webinar held on June 3-4 on the effect of COVID-19 on health-care management of the elderly was conducted in collaboration with the West African Health Organisation (WAHO), and took a critical look at various aspects of the impact of the disease on the elderly, who are usually at higher risk of infection.

He said the outcome of the webinar provides grounds for policy direction for care of the elderly during and beyond COVID-19, saying the general recommendation is that senior citizens are vulnerable and should stay at home most times and wear a mask once outside their home.

The government also said the Presidential Task Force on COVID-19 has commenced the process of integrating comprehensive psychological services programme into its activities as part of plans to enhance the psychological wellbeing of patients and their relatives.

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Boss Mustapha, chairman of the PTF COVID-19 response team, said at the daily briefing that the plan would benefit people who are in isolation, wellbeing of their families and communities.

The drive which is already being spearheaded by the Federal Medical Centre, Jabi, FCT, will inevitably assume a national dimension because of the importance of mental health.

The PTF had before now paid a lot of priority on the physical health management of people who are affected.

The PTF, while providing situation reports on the first 100 days, said the number of laboratories in the COVID-19 network has increased from two to 30 – with a laboratory in every geopolitical zone in the country, providing increased access to testing.

This is just as over 80,000 tests have been conducted in the country, 13,000 health workers have been trained, increasing the human resource available for case management.

“More personal protective equipment and ventilators have been procured and prepositioned across the country, with the number of beds available for isolation and case management increased from 3,000 beds to 5,000 beds nationwide,” Mustapha said.

He said the country has “developed new guidelines for homecare and general case management, evacuated over 1,000 Nigerians from different parts of the world while still reviewing the evacuation and quarantine protocols and evaluated the efficiency of the identification, testing, evacuation, and isolation process for confirmed @Businessdayng

cases”.

Other achievements of the PTF include gradual reopening of the economy while balancing between lives and livelihood, while a Mid Action Review has been conducted in line with WHO guidelines, with lessons and recommendations being used to improve the response.

The PTF has also introduced community engagement and risk communication as critical factors that will help to flatten the curve in a sustainable manner.

“There are several ongoing infrastructure interventions being made by government, development partners and the private sector nationwide,” he said, adding that the last 100 days have also brought out the best in the spirit of Nigerians.

Aliyu Sani, national coordinator, said the task force has proposed new protocol for the evacuation of Nigerians abroad, as over 4,000 Nigerians are currently awaiting evacuation.

Aliyu, who said it was essential that Nigeria gets it right and makes the best use of resources available, added that it was working to bring the more than 4,000 Nigerians currently outside the country to come in and join their families.

“The PTF has the responsibility of mitigating risks, and ensuring that we do not increase the number of cases we have in the country, therefore increasing the risk of transmission,” he said.

“We have looked at the various options available, and I’m grateful that the private sector has clearly stepped out and supported the testing that would be required for the Nigerians coming in.”

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BUSINESS DAY Tuesday 09 June 2020 www.businessday.ng

Chuks Umezulora: Lighting Nigeria one solar panel at a time

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ISAAC ANYAOGU

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hu k s Um ez u l o ra graduated with a degree in Industrial Chemistry from the Imo State University, but you would find that hard to believe because of his fascination with machines.

“Even though I studied Industrial Chemistry, I have always been interested in technical side of things and I discovered I had keen interest in the subject,” said Umezulora.

It is this love for machines that led to an interest in how it could be deplored to solve Nigeria’s energy challenges. His first foray into the renewable enegy sector started when he was asked to be on the technical team of Sky Resources Nig Ltd where he was happy to work without pay just so he could work with a team doing installations for solar components. Though solar was yet to go main stream, he recognised early on the potential that existed in the industry and stayed.

He co-founded Chume Integrated Services Co. Ltd in 2005 and Auxano Solar Nig Ltd was registered in 2014 specifically for Solar Business. Auxano Energy is an indigenous company that deals in procurement, sales, designs, installation and maintenance of solar and inverter systems.

Auxano, runs one of biggest solar assembly plants in the country and is ramping production of solar panels and has partnered with All On, an impact investors in the sector as well as the Bank of Industry to increase production of solar panels in NIgeria.

The company’s factory in Lagos boasts of high-tech machines for cutting, welding, resizing and assembling the components required to build solar panels. The outfit employs over 30 people who have been trained through all the stages of the company’s operations.

In the early stages of the business, Umezulora said the company hired labour from a local technical school and involved them in training sessions it had with the Chinese..

“This helps us manage our costs,” he says, “it also reduces downtime,” But it also raised the problem of employee turn-over as many left after just staying six months to pursue higher education.

Two years ago, Umezulora told BusinessDay that response from the local market to solar energy was just beginning to thaw now it seems it is turning the corner. Many Nigerians have grown from a deep-rooted aversion for solar energy to acceptance such that even banks, government offices and even power companies now have solar as part of their energy source.

Based on my studies I have found out that the Chinese did a solar concession for 10 megawatts, sponsored it and took it as a case study for other 100 megawatt, 150 megawatt and so on

Chuks Umezulora, COO, Auxano

The initial challenge was competing with imports from China which were cheaper even though the quality of suspect.

Umezulora said that the initial question he got was whether it would work even when he knew his product was better than what was being bought from China.

The entrepreneur said that with support from organisations like All On, many local operators have become more receptive.

Auxano was among the four companies that benefited from the N180 million assistance to renewable energy companies, to provide solar power for emergency health centers in support of the response to fighting the COVID-19 pandemic.

All On said the four companies, all investees of All On, were selected based on their immediate preparedness to respond with products, inventory, technical capabilities and their efficient delivery track record.

The investees will tap into initiatives that support the national effort to alleviate the burden on the nation’s fragile health care sector in this time of crisis.

In 2018, Auxano also won All On and USADF energy challenge, organised in partnership with USADF and awarded $100,000 grant, half in the form of low interest loan between 7 and 10 percent over five years and half as grant to support 10 different companies providing energy solutions for productive use in agro processing to a solar power assembling plant.

“The process for application was very rigorous,” Umezulora said, “we had calls for three hours on some occasions and they ensured every detail was verified to ensure regulatory and technical compliance and that the business plans are realistic.”

The growth of renewable energy in 2018 saw the government imposed a 10 percent duty on renewable energy components though Nigeria lacked the capacity to manufacture all the solar panels it needs.

“Locally we don’t even have capacity to assemble enough panels to meet demand. Nigeria cannot live in isolation in comparison with other West African countries, imposing this kind of tariff will only move investments

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What I recommended is that government do a tender for a smaller system, maybe 10 megawatts, sponsor it, take the risk, pay for it assume the risk so we can use it for a case study and iron out all the issues that have to do with costing

to other countries,” said Umezulora at the time.

The new duty will increase acquisition cost of solar panels and made other African markets attractive for new investments.

East African countries already miles ahead of Nigeria in terms of solar adoption attracted millions of dollars in new investments.

But the Nigerian government was not backing then and rather continue to pine, the entrepreneur along with others in the sector have seen it as a challenge to ramp production by expanding partnership which sometimes require improved corporate governance because an investor may have a seat on your board.

Umezulora has canvassed government support systems like the Chinese model to assist local manufacturers including consistent exchange rate policy, access to finance and working capital and implementation of already developed policies to improve ease of doing business.

Much of the funding for Auxano’s operation have come from grants and commercial loans both from lenders and partners.

Impact The impact the funding is that it has given the company the opportunity to begin to actualise some of its dreams; increase working capital and then with more working capital, it has been able to improve profitability and their numbers now look better from what it used to be said Umezulora .

“When you have more funding you have more raw materials more goods, your profitability actually goes higher because with the same workforce you can do so much more.

“Let me give a simple ex-

ample in lay terms, before when we were doing manual restringing we can do maximum of 20 panels in a day but with the auto stringer we can do 100, even up to 150 in a day. You can see the jump, so that has made a lot of difference and also it has eased off the pressure on me because when you know what to do but lack the resources it can be very depressing.

So auto stringer has not fully come up the installation will be done next week and we expect it to come up by May latest. What it does for use is that it makes our cost of production to drop so with that we can compete more effectively,” he said.

According to the entrepreneur, challenges with assembling is improving. “It is improving because on our side, due to the recent VC grant and support from BOI we just recently got a machine, an auto stringer that helps us automate processes we used to carry out manually and with that our output is being improved 6 to 7 times of what it is to be.”

On importation, Chuks said it will take time. “Yes, but its going to take some time because the honest truth is that most of the activities you seen in the Nigerian energy sector is being done in the downstream so maybe about 10 percent at the mid-stream but nobody has gone upstream, so it might take some time.

On ways to improve policy, he said: “I will give a very simple example. Based on my studies I have found out that the Chinese did a solar concession for 10 megawatts, sponsored it and took it as a case study for other 100 megawatt, 150 megawatt and so on.

“What I recommended is that government do a tender for a smaller system, maybe 10 megawatts, sponsor it, take the risk, pay for it assume the risk so we can use it for a case study and iron out all the issues that have to do with costing. This approach would give the government the opportunity to know what the actual cost per watt that this thing was delivered at; forget theoretical and paper calculations, what is the actual watt in the Nigerian context.

“Then what are the technical challenges faced which includes infrastructure, how much did it actually cost us because most of what the government add/had was actually learnt from other places.

“We need to upgrade our grid infrastructure what is the cost?

We can now say we did for 10MW his is how much it costs and then extrapolate and say if we do 100 megawatts this is how much it is going to cost but if the government wants the company to take all the risk and get the guaranty it is not going to work.

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Advert Hotline: 08033225506. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Patrick Atuanya. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.