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news you can trust I ** wednesDAY 11 DECEMBER 2019 I vol. 19, no 454

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Spot ($/N) 363.56 306.90

Currency Futures

NGUS FEB 26 2020 363.50

6M

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30 Y -0.28

11.24

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NGUS MAY 27 2020 364.51

As firms target innovation to boost $1.6bn gross premiums

Modestus Anaesoronye & BALA AUGIE

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NGUS DEC 30 2020 366.87

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FG’s failure to pay group life premiums to hit insurers’ profits he failure of the Federal Government to pay premium on group life insurance for its employees, assets, as well as for men and officers of the Nigeria Police for 2019 will have negative impact on the revenue and profits of the industry this year.

Government, being a large spender in the industry/economy either through direct spending on payment of premium or on infrastructure development, impacts heavily on insurance companies, so not spending on the sector this year will mean that the industry will have to suffer shortfall from that segment of the business.

The implication of this is that Continues on page 38

3M 0.00 6.97

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AMCON chairman’s sack heightens 2023 permutations IHEANYI NWACHUKWU & INIOBONG IWOK

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resident Muhammadu Buhari on Tuesday sacked another Lagos politician, Muiz Banire, as chairman of the Governing Board of Assets Management Corporation of Nigeria (AMCON), appointing Edward Lametek Adamu as new chairman of the Corporation.

Banire’s removal comes barely a day after the president replaced Tunde Fowler as chairman of Federal Inland Revenue Continues on page 38

Inside Nigeria’s finance minister, others launch Santiago Action Plan to tackle climate change P. 2 L-R: T. C. Awagu, patron, Nigerian-British Chamber of Commerce (NBCC); Kayode Falowo, president and chairman of council, NBCC; Aigboje Aig-Imoukhuede, founder, Coronation Merchant Bank, and Akinola Akintunde, patron, NBCC, at the Chamber’s First Sharing Experience Series themed ‘Building Institutions’.

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news Arik Air fleet receives massive boost, set for Christmas season IFEOMA OKEKE

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rik Air received two aircraft from C-Check over the weekend, thereby boosting the operations of the airline in the coming festive season.

The two aircraft include a Q-400, while the Boeing 737-800 check was conducted by Lufthansa Technik AG in Malta.

Over the last two years the current management has been working hard to improve the number of serviceable aircraft in the airline’s fleet. The efforts are yielding results.

The Arik fleet are nearly mid - life and such require major overhaul of engines, landing gear, etc. Unfortunately, Arik in addition to being over burdened by debts had no reserves. The company was simply in a fix. The significant work done to date has therefore been the result of prudent management of resources and the support of Asset Management Corporation of Nigeria ( AMCON ).

The management ’ s effort is bearing fruits with two more aircraft expected to return from C-checks in the next few weeks - one at the end of the year, and another in January.

Since the current management took over the airline operation its Earnings Before Interest, Taxes, Depreciation

and Amortization (EBITDA) is positive, customers’ confidence has been restored On Time Performance (OTP) is over 70 percent - from as low as 30 percent; load factors on domestic routes are over 80 percent, flight cancellations are down to less than 1 percent from over 40 percent, Salaries are paid as at when due, pensions are being remitted, all current obligations are being met and the company is prepared for AMCON exit.

The Boeing 737-800 had been in Malta with Lufthansa Technik AG since 2015 before the current management came on board, and its return is a huge testimony of the achievements of the current management due to the high cost of C check of as a result of extended lay over.

The Chief Executive Officer of Arik, Capt. Roy Ilegbodu said: “ We are pleased to announce the return of of some of our airplanes, following positive resolution of our outstanding debts with African Export Import Bank (AFREXIM) and strong support from Lufthansa Technik AG. “ We are aware that our services are critical to numerous travelers in this festive season, and we are ready for the challenges ahead with improved schedule in our domestic and regional network and excellent customer experience. ”

Reps give MDAs 20 days to remit unspent budget funds JAMES KWEN, Abuja

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he House of Representatives on Tuesday called on all ministries, departments and agencies (MDAs) to ensure remittances of all unspent budget funds to the treasury on or before December 31, 2019.

The House also resolved to set up an ad-hoc committee to investigate the amount of unspent constituency project funds not remitted in the last 10 years, identify the defaulting agencies and report back within eight weeks for further legislative action.

These decisions were made during plenary on Tuesday, sequel to adoption of a motion on ‘Need for Refund of Unspent Budget Funds’ sponsored by Femi Gbajabiamila, speaker of House, and five others.

Presenting the motion, the sponsors said the House noted the increasing need for budget discipline and accountability as well as releases of constituency

and other project funds that are based on total sum provided in the annual national budget.

They said the House was “aware that most constituency projects, like other capital projects, are awarded at an amount lesser than the budget provisions by government ministries, departments and agencies (MDAs)”.

The House, they said, was “also aware that unspent capital funds of MDAs are returned or rather automatically mopped up by the Central Bank of Nigeria (CBN) at the end of each financial year”.

The House was “further aware that excess funds accruing from the undervalued awards of constituency projects are not returned to the treasury” and was, therefore, “concerned that those funds are misapplied to other expenditure items contrary to extant public financial management laws and regulations”, the sponsors of the motion said. www.businessday.ng

L-R: Alan Giordmaina, head, commercial project management, Lufthansa Technik AG, Malta; Stephan Schulze, senior sales executive, corporate sales, Lufthansa Technik AG; Rolf Weirhauch, sales executive, corporate sales, Lufthansa Technik AG; Francis Esoh, senior manager, credit quality assurance, Afreximbank; Ali Magashi, member, technical advisory committee, Arik Air; Roy Ilegbodu, CEO, Arik Air; Marcus Motschenbacher, CEO, Lufthansa Technik AG, Malta, when Arik Air team went to take delivery of the Boeing 737-800 from Lufthansa Technik maintenance facility in Malta.

Gas, renewables’ 2019 performance shows where investors can put money … as Nigeria’s $460bn gas reserves under-produce STEPHEN ONYEKWELU

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nvestments in natural gas, renewables and nuclear energy in 2019 paid off above those in oil and coal, an indication that the world is moving towards cleaner energy and rewarding investors in this space. Energy investors in Nigeria stand a chance to take advantage.

Paris-based International Energy Agency (IEA) said the past three years has seen higher growth for carboncentric energy sources as well as a significant acceleration in renewable energy developments. Investments in renewables exceeded those in fossil fuel-based power.

Renewable power capacity is set to expand by 50 percent between 2019 and 2024, led by

solar photovoltaic (PV). This increase of 1,200 gigawatts (GW) is equivalent to the total installed power capacity of the United States today. Solar PV alone accounts for almost 60 percent of the expected growth, with onshore wind representing one-quarter.

Natural gas demand grew at 4.6 percent in 2018, with 314 million tons delivered, and the growth streak has extended to the current year driven by the on-going transition away from coal-fired electric power, decent economic growth and weatherrelated demand amid a price slump of historic proportions.

Natural gas now accounts for 45 percent of the increase in energy consumption over the past decade.

The total value of Nigeria’s proven gas reserves is

over $460 billion, more than the country’s gross domestic product (GDP) as of today.

Yet, in a world where gas is emerging as the fuel of the future, Nigeria lags due to its inability to articulate a clear vision for energy security around gas.

“We need clearly focused regulations that will create gas-based industries in Nigeria, which will absorb teeming employable youth and create a multiplier effect that will affect the SME corridors which will change the things we do in this country,” Audrey JoeEzigbo, president, Nigeria Gas Association (NGA), said.

The United Nations has predicted that the world’s population will grow from 7.6 billion to 9.8 billion by 2050.

Coupled with rapid urbanisation, this will continue to

drive energy demand but the demand for fossil fuel-based power is falling.

“Certainty of investment is another major concern.

Nigeria has adopted an oil philosophy and is failing to understand how to run a gas economy,” Joe-Ezigbo noted. “Nigeria is still focusing on associated gas, when are we going to start focusing on Non-Associated Gas (NAG).”

Global electricity demand has been growing about twice as fast as overall energy use and could climb by more than 50 percent by 2040, with energy demand growing by 25 percent over the time span, said Anes Alic, an analyst at Oilprice.com.

•Continues online at www.businessday.ng

Nigeria’s finance minister, others launch Santiago Action Plan to tackle climate change Josephine Okojie, Madrid

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he Coalition of Finance Ministers for Climate Action have launched the Santiago Action Plan that aims to accelerate their countries’ transition to low-carbon and climate-resilient economies.

The Action Plan was launched at a high-level segment during the on-going UN Climate Change Conference - COP25.

The coalition, co-led by Finland and Chile, comprises 51 countries – including Nigeria – that account for 30 per-

cent of global Gross Domestic Product (GDP).

“We will not achieve our climate goals unless we have unity and cooperation on a global scale to tackle climate change which is an existential threat to all of us,” said Patricia Espinosa, executive secretary of the United Nations Framework Convention on Climate Change (UNFCCC).

“Finance is at the heart of our economies and it must be at the very centre of our efforts to transform them. It is the lifeblood of production and consumption worldwide and it must become the seed of a new

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global economy. Without it, a sustainable, greener world will be impossible,” Espinosa said.

The Coalition of Finance Ministers for Climate Action was launched at the World Bank Group-IMF Spring Meetings in April 2019, with members endorsing six principles known as the ‘Helsinki Principles’.

Nigeria is among countries that have endorsed the Helsinki Principles and the Santiago Action Plan.

The ‘Helsinki Principles’ promotes national climate action, especially through carbon pricing, macro-fiscal @Businessdayng

policy, public budgeting, and financial sector initiatives.

Ignacio Briones, Chile’s minister of finance, reaffirmed the political commitment of the finance ministers to climate change and sustainable development.

“People are the ones who suffer the pernicious effects of the temperature increase.

Also, people are the ones who are suffering the transition to a low –emission economy when this transition in not fair,” Briones said.

•Continues online at www.businessday.ng

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‘Border closure may be counter-productive if policies are not made to ease production’ SIKIRAT SHEHU, Ilorin

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armers under the aegis of All Farmers Association of Nigeria (AFAN) have declared that border closure can be counter-productive in the long run if cogent policies and relevant mechanisms are not made to drive agricultural productivity.

They suggest that the African Development Bank (AfDB) should be more resilient and ready to partner the Federal Ministry of Agriculture and Rural Development (FMARD) to promote the Special Agro-Industrial Processing Zones (SAPZs) project across the major agricultural zones of the country. Farmers and other relevant stakeholders state this in Ilorin at a two-day agricultural workshop tagged “Farm2fork Dialogue organised

by AgroAfrica, AfDB, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) in collaboration with the Kwara State government with the theme: “Eliminating the Economic Impediments to a Prosperous Commodity Agribusiness.”

Speaking on behalf of Nigerian farmers, Kabir Ibrahim, president of AFAN, observed that border closure was an encouragement for the local farmers, but could also be an impediment to them if enabling policies and mechanisms were not put in

place, saying: “We don’t need to call people from outside the country to teach us what to do on agric.”

Ibrahim, who was represented by the vice president, Daniel Okafor, noted, “Today people are in dry season farming because the price of rice is competitive in the market.”

Also speaking at the workshop, Richard-Mark Mbaram, CEO, AgroNigeria/AgroAfrica, posited that Nigeria had a mild state of emergency on its economy in the area of agribusiness, adding that the ongoing closure of Nigerian land borders amounted to looking at the face of saboteurs and drawing a line.

He said, “There is a need for more practical steps by the Buhari government, if we look at the Chinese example of border closure leading to their industrialization. They turned on their people for reorientation and that is what they called cultural revolution.”

Also, Oyebanji Oyeyinka, senior special assistant to AfDB president on industrialisation, stated, “There is always a time in every nation’s history to make a turning-point.

“We believe that Africa should not be importing food, we believe Africa should not also be exporting its raw materials rather, it should be processing them locally. As a result, Africa should not suffer malnutrition.”

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EFCC convicts 84, recovers N217.2m in Edo, ICAN, professionals urge FG to Delta, Ondo in 2019 prioritise inclusive growth in 2020 IDRIS UMAR MOMOH, Benin

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he Benin zonal office of the Economic and Financial Crimes Commission (EFCC) says it has between January and November 2019 convicted 84 persons for corruption in Edo, Delta and Ondo states.

Muhtar Bello, head of the zone who made the disclosure during a road walk in commemoration of the World Anti-Corruption Day on Monday in Benin City, with the theme, ‘United Against Corruption,’ added that it recovered N217,268,236 million from corrupt individuals in the zone.

Bello said various properties including houses and vessels were also forfeited by the convicts, listing states that made up the zone to include Edo, Delta and Ondo.

The EFCC, Benin zonal head, added that between 2015 and 2019, the commission secured a total of 1,636 convictions across the country including the convictions of former governor, Joshua Dariye of Plateau State, Jolly Nyame of Taraba State and that of Orji Uzor Kalu, former governor of Abia State, respectively.

Bello, who noted that the World Anti-Corruption Day was in line with the United Nations General Assembly resolution on October 2003, said the road walk was geared towards drawing attention to the grievous

consequences of corruption and the need to combat the menace.

While noting that the zone was determined to win the fight against corruption through preventing measure, diligent investigation and prosecution, he however added that the agency was not relenting in its effort at combating corruption and other financial crimes in Nigeria.

“As part of our preventive measures, we took our enlightenment and sensitisation campaign to members of the National Youth Service Corps at the various NYSC orientation camps, several secondary schools and higher institutions in the zone.

“For us at the EFCC, we recognize the fact that we cannot win the fight against corruption alone. We need the support and cooperation of all stakeholders, in order to make meaningful progress in restoring transparency, accountability and due process in public governance.

“Our promise is that we remain resolute and determined to defeat corruption in our country. I also urged, members and leaders of various interest groups, trade union, civil society organisations and professional bodies to facilitate mass education, mobilisation and active participation of Nigerians in the fight against corruption,” he said.

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KELECHI EWUZIE

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ccountants, economists and academics have called on the Federal Government to prioritise inclusive growth come 2020, and to also intensify structural changes in the economy that closely benchmark top performing nations like Malaysia, Singapore and South Korea.

They opine that reducing poverty through right and strategic policy implementation in 2020 should be a major priority.

Experts, who spoke at the 2019 Economic discourse organised by the Institute of Chartered Accountants of Nigeria (ICAN) in Lagos, maintain that this charge should have private participation.

Biodun Adedipe, chief consultant, B. Adedipe Associates Limited, says the present and future of the economy lies with the private sector, adding that about 89.68 percent of value being or to be created is within their powers.

Adedipe in his presentation titled ‘Current reforms in Nigeria and2020Outlook’urgesthegovernment to facilitate the private sector operators with enabling business environment, noting that governments do not grow or do business rather they facilitate the operators.

Nnamdi Okwuadigbo, 55th president of ICAN, in his opening remark, explained that it was germane to x-ray the present

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situation due to the fact that previous economic reforms and programmes appear to have failed in repositioning the country to the desired status among the comity of nations.

Hence, a critical assessment and an unbiased appraisal of current reforms are important if the nations do not want to travel the same path of failed policies.

According to Okwuadigbo, “A projection into the year 2020 is not only pivotal to informing governments’ actions but also central for decision-making by business entities.”

Adedipe in his presentation pointed out that the Federal Government of Nigeria budget for 2019 was N8.92 trillion; nominal Gross Domestic Product during H1 2019 was N66.769 trillion, which annualises to N133.54 trillion for the year, meaning Federal Government spend plan is 6.68 percent of projected total value of economic activities in 2019.

“If the states and local governments do similar to their actual revenue for 2018 (N4.225trn), grossed up with fresh 15 percent borrowing, total spending will be N4.86trn.”

States budgeted N9.23 trillion in 2019 and that brings the total government spend to 10.32% of estimated GDP. Clearly the present and future of the economy lie with the private sector,” Adedipe said.

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SMEs: Some success factors for 2020 Small Business handbook

Emeka Osuji

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o much has been said and also done, concerning the development of the SME sector, not just in Nigeria but in several other parts of the world. At the African continental level, for instance, the Africa Union Commission (AUC), in its search for the evolution of “competitive, diversified and sustainable economies in Africa, underpinned by dynamic, entrepreneurial and industrial sectors that generate employment, reduce poverty and foster social inclusion”, established the Enterprise Africa Network (EAN).

The Network is a flagship initiative of the AUC, which aims at implementing the Business Development pillar of its Africa Master Plan for 2017-2021.

The initiative would provide services relating to the developmental needs of African SMEs, including international partnerships with the private sectors of other economic groupings, including the European private sector. It will also offer advisory services for international growth as well as support for business innovation.

The Enterprise Africa Network therefore becomes a strategic institutional resource, to facilitate the realisation of the objectives of the AUC by confronting the key obstacles hindering SME development and growth. It hopes to promote the participation of SMEs in the formal economy of their respective countries, as well as in regional and global trading spaces by tackling lack of access to markets and market intelligence, stifling regulatory barriers and hostile environment. This is a very good plan, at least on paper. And Africa is replete with good paper work. Domestically,

several funding plans have been made but little else.

As 2019 closes, what ought to bother Nigeria is not hate speech. If anything, our research should focus on the sources and causes of hate speech. Even then, it does not take an hour to decipher why Nigerians have never been more hateful of themselves as they are today. I can tell anybody for free that the moment a family is divided between the beloved and the unloved; there is no stopping unhealthy sibling rivalry and hatred.

Ask the Biblical Joseph and his brothers!

Today, everything in Nigeria is divided between the loved and the unloved – employment, social amenities, public projects, security and anything imaginable coming out of government - national and subnational. But like everything in Nigeria, shallow thinking has pointed to hate speech without giving a thought to its causes.

The band wagon has taken off and everyone is milling down the wrong way. We are throwing laws at the symptoms of a deeply seated problem of poor leadership and discrimination; just as we throw money at every problem, without understanding their root causes. Hate speech is caused, first and foremost, by hate policies – nepotism, tribalism, discrimination and all the ills with which Nigerian politicians go to bed every night.

Our thoughts should be how to position our citizens, through their enterprises, to benefit from the many international agreements, including those on free trade. From all indications, there is need for SME operators to brace up, rethink their strategies and retool operational modalities, so as to maximally profit from the opportunities that may arise in 2020, not necessarily from the effective law-making work at the legislatures but from the opportunities across the borders. In this regard, we attempt here to highlight some of the attributes and strategies that must be manifest in the affairs of those SMEs that will pop champagne this time in 2020.

The Nigerian economy is growing at less than 3 percent per annum as against its population, currently estimated at

198 million people and growing at a rate in excess of 3 percent – a growth deficit.

Ghana’s population of about 29 million people is growing at the rate of 2.2 percent while its economy grew at the rate of 8.5 percent in 2017 – a surplus and the fastest in five years, and 7 per cent in 2018. Ghana was the first country in Sub-Saharan Africa to achieve the Millennium Development Goal 1 - the target of reducing extreme poverty by half.

We never did. Ghana has also become a middle income country. Although Nigeria is not among the 37 Heavily Indebted Poor Countries, debt service is gulping about a quarter of its 2019 budget (N2.14 trillion). The problem is not debt or its service but where the money was put.

Putting the money in a blatantly wrong use is a hate speech generator.

The oil market is still soft, with many traditional buyers of Nigeria’s crude, including India, either slowing, looking elsewhere or seeking alternative energy sources. Currently below 2 million barrels/d output is projected to reach 2.3 million barrels a day – some kind of miracle jump. In short there is no certainty in this rapid production increase.

This could negatively impact revenue, cut jobs and put more pressure on the beleaguered households and make them speak ill of anybody at all and we may have them shot. Clearly, SMEs face a challenge and must therefore guard their loins and brace up for all sorts of negative externalities, including enhanced tax drives and worsening business space. All considered, final growth in 2019 may be minimal and needless to restate that SMEs have little or no prospects when an economy stagnates.

The dividends of the failed strategy of neglecting the Warri and Port Harcourt ports and concentrating almost import trade in Lagos have come to roost.

Almost all businesses in the hitherto highbrow Apapa GRA have shut down.

Nobody of any economic substance lives in Apapa. At best you find hapless landlords without an alternative.

The economy of Lagos is bleeding but strangely the state is not complaining.

It takes six days to take a container from the Apapa Wharf gate to Isolo, and even

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Nobody of any economic substance lives in Apapa.

At best you find hapless landlords without an alternative.

The economy of Lagos is bleeding but strangely the state is not complaining

Dr Osuji is head of the department of Economics at Pan Atlantic University Lagos. eosuji@ pau.edu.ng @Emekaosujii

When silence is not golden

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ur propensity to keep silent in the presence of abnormalities has brought us to where we are. Such can range from the innocuous act of someone shunting the absurdly long queue at the Bank thinking he’s smart; being aware of a colleague cutting corners at the office because he believes that’s the way it’s done, after all this is Nigeria; or even people thoughtlessly disposing of litter on the floor, betraying a mind-set that simply doesn’t recognise right from wrong.

It’s not just one of these acts but all of them put together and more, that corrupts a system; especially when it’s seldom corrected. We say to ourselves, “What is my own? I better keep quiet before they all insult me that my own is too much.” “Na your papa get am?” Is what they’re almost certain to ask me. And from this point, forever you must remain quiet because at the end of the day, where were you and what did you do when moral standards were gradually being eroded? When wrongful acts were repeatedly committed before your very eyes?

It’s now almost too late to talk. The horse bolted long ago. It’s pointless trying to close the stable doors now.

We turn a blind eye to these things when we feel it doesn’t affect us directly. And that’s where we get it horribly wrong. Continuous silence by the majority can only lead to an increase in the number of those emboldened to do wrong.

A whole generation now grows up without an absolute sense of right or wrong; it’s all become so relative. It depends on who’s doing the wrong.

If it’s themselves, their favourite trouble prone celebrity or their political benefactor, then it can’t be wrong. May I also add that if you don’t

get caught, that too can’t be wrong. You’re just sharp. By the time it degenerates to this level as it has done in our society, you can no longer claim it doesn’t affect you because it affects everybody.

I remember an incident during the time of endless fuel queues. I visited the station on a Sunday afternoon in preparation for the week ahead and joined a horrendously long queue.

With the sweltering heat it was quite unbearable. We like to suffer ourselves in this country sha! The amount of avoidable hardship we’re repeatedly subjected to. Anyway, before digress, as the queue edged forward painfully slowly, a motorist came along who said he wanted to use the Bank’s ATM. Because of the queue, he couldn’t get access into the Bank’s compound so he asked permission of the motorist in front of me, who happened to be a woman, if he could park beside her on the road, since he wasn’t going to be long; so she graciously agreed.

His parking on the road even caused a further gridlock which infuriated motorists who were forced to squeeze past.

One enraged gentleman wanted to deflate his tyres to teach him a lesson and I was among those who pleaded with him not to. Unknown to us, this morally bankrupt individual had other plans. While pretending to use the ATM, he was actually using the vantage point he gained to watch the front of the queue so he’ll know when there’s movement long before it gets to us. He timed his movement from the ATM back to his car so perfectly without raising any suspicion, that before the motorist in front of me could start her engine, he hastily slipped his car in front of her.

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Those who’ve been unfortunate enough to experience the long petrol station queues before will appreciate the sort of camaraderie that develops amongst fellow motorists at times.

Not always but sometimes.

Several of us motorists queuing both in front and behind the female motorist jumped out of our vehicles to confront this thoroughly distasteful young man but despite our protestations which quickly degenerated into scuffles between him and those who resorted to trying to wrestle him down, he sternly refused to budge. I was utterly disgusted by this shameless display of treachery and moral emptiness but it was his justification that really took the biscuit. In his own words he proudly told us that he saw an opportunity and he was smart enough to take it. He further backed up his dishonest act by relating how he too had fallen victim to such perfidy and had ended up spending the night on a similar queue some months (not days, not weeks) before.

On that day, while he was still queuing, the station ran out of petrol, all because the station attendants were collecting “egunje” and allowing motorists to enter through the exit gate. In the eyes of these attendants what both they and their ‘partners in crime’ were doing was not wrong. They too recognized an opportunity and took it. But if someone who refused to pay tried to do it, they would speedily shut the gates and remind him that it contravenes the rules. Wrong has become so relative; depending on who’s involved. As such the whole system becomes totally rotten and dysfunctional and we all pay for it eventually. Because this terrible young man felt he had been “chanced” and the culprits

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longer to return the empty container to the shipping company.

At the end, demurrage consumes the Container Refundable Deposit of about N400,000, which importers pay. Ask me why inflation continues to grow. The impact of the Apapa disaster on Lagos economy is huge.

Even more important, SMEs must understand and embrace the reality of the time – the world has gone digital.

Services are being migrated to the digital space. There is no hiding place for those that hang on to the dying analogue age.

On this matter, there will be no standing on the fence. One is either in or out.

Furthermore, exploration, discovery and deep utilization of digital platforms, the social media and marketing strategies will be imperative, if they are not cowed out of the social media. In this regard, investment in capacity development is vital. Many free offerings have been made in this area but operators must realize that there is actually no free lunch. A small training budget even if it is for the key man alone, is unavoidable.

Continuous effort to create bankable projects, the lack of which is a major cause of the financial starvation of SMEs, and of course, general self-improvement of SMEs’ internal processes is important.

SMEs are not famous for their customer-centricity. The need for repeat business has never been their priority.

It is time for SMEs to hold on to the customers they have been able to garner. The only way to do this is first to know who the customers are; listen to them and try to hear what they are saying. This guides the development and deployment of products and services.

Owing to the fact that we have never been interested in whether the customer repeats or disappears, we are unable to innovate. Need identification precedes innovation. SMEs that close in on their customers and constantly interact through various digital channels will be better able to offer goods and services that meet customers’ needs.

Character Matters with Daps

Dapo Akande appear to have gotten away with it, he decided to also do his own.

Maybe, just maybe if he and fellow motorists had protested stridently enough on that day to force the station attendants to abandon their money making venture, which was so clearly unfair to those who had spent hours of their productive life at the station, he may not have taken his own ‘revenge’ on innocent souls like us, thereby polluting the system further. We can no longer afford to play the ostrich by keeping silent in the face of impunity and other displays of antisocial behaviour. Just as how litter repeatedly thrown into the gutters has been responsible for perennial floods in Lagos, and yet people ignorantly continue to do it, we collectively need to wake to the fact that our actions will always come back to haunt us. Silence is not always golden.

Changing the nation...one mind at a time.

Akande is a graduate of the University of Surrey, UK, author of the acclaimed book: “The last fight: A personal journey to discovering values.” Contact: dapsakande25@gmail.com

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Protectionism: The wrong approach to addressing Nigeria’s import dependence

Olanrewaju Rufai

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he Nigerian government’s recent decision to close the country’s land borders to all goods is the latest addition to the nation’s litany of protectionist measures implemented in recent years. In fact, protectionism in its various forms, including import restrictions, tariffs, exchange rate controls etc. has been the go-to policy for Nigerian policymakers.

For decades, successive Nigerian governments have resorted to protectionist measures to combat the nation’s dependence on imports. Although the protectionist measures have never achieved the policy objective of industrialising Nigeria, this has not stopped successive governments from constantly adopting them.

The allure of protectionism has always been strong in Nigeria especially in the face of an economic crisis.

In the early 1980s, the Shehu Shagari government responded to Nigeria’s first major economic crisis with import restrictions. When the Buhari military regime replaced Shagari’s government in 1983, it escalated the existing import restrictive policy by placing all imports under licensing and closing Nigeria’s land borders. Similar protectionist principles, albeit in various guises,

guided successive military regimes.

A situation which failed to improve under the civilian dispensation that started in 1999.

Indeed, the Obasanjo administration in 2002 prevented import licenses being granted to cement companies who could not show proof that they were building local processing capacity. Fast forward over a decade afterwards, and similar policies remain in place and are constantly enacted. In June 2015, the CBN published a list of 41 items ineligible for forex, including essentials like rice and cement. In the following years, the CBN added fertilizers and textiles to the list. And about a month ago, the current administration closed the country’s land borders to all goods.

All of these have been undertaken to spur growth in the local industry such as the textile, cement, auto manufacturing and agriculture industries.

Nevertheless, the fact that Nigeria is yet to become self-sufficient in these industries highlights the failure of the nation’s long-standing protectionist stance.

Ironically however, industries which have not been protected have experienced the strongest growth while the protected ones have declined or stagnated.

The services industry, which scarcely benefitted from protectionist policies has flourished, and now constitutes over 50 percent of the nation’s GDP. On the other hand, the share of manufacturing as a percentage of GDP, for example, has remained more or less flat at less than 15 percent of GDP. The effects of protectionism on Nigerians are glaring. For example

despite the existence of a number of restrictions around importing cement into the country, and numerous incentives to promote local cement production, local cement prices remain prohibitively high. The auto manufacturing industry tells a similar tale. Despite the heavy duties on imported cars in 2015, there has been no significant growth in the local auto manufacturing industry.

Furthermore, for all the rhetoric about the progress Nigeria has made with local rice production, Nigeria remains the world’s second-largest importer of rice.

All of these highlight the failure of these policies, an unsurprising outcome due to a variety of reasons.

Nigeria’s protectionist policies fail because policy makers often fail to recognise that imported products thrive not only because they are of higher quality, but mainly because they are cheaper. As the nation with the highest number of poor people in the world, Nigerians are price sensitive, thus will often choose a cheaper product, irrespective of its origin. Unfortunately, this does not bode well for locally manufactured products which tend to be more expensive, as they cost more to produce due to the tough business environment.

Nigerian companies typically battle against a plethora of challenges in the local business environment, including poor infrastructure, erratic power supply, expensive alternative sources of power, multiple taxation, a high cost of borrowing, an onerous regulatory environment, inefficient ports etc. All of these bottlenecks often ensure that locally produced items are often more expensive than imported items.

The failure of Nigerian businesses to

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Nigeria’s protectionist policies fail because policy makers often fail to recognise that imported products thrive not only because they are of higher quality, but mainly because they are cheaper

take advantage of the nation’s protectionist measures also illustrates the fact that protectionist policies are not viable alternatives to sound economic policies and a friendly business environment.

Basically, rather than imposing these policies, the government should direct its focus to addressing the multiple dysfunctions in the local business environment which leave local companies unable to compete with imports or even satisfy local demand. Therefore, the government, rather than enact protectionist policies should focus on making doing business easier.

Furthermore, protecting industries where Nigeria has no comparative advantage is a futile approach. Comparative advantage describes the economic reality of the work gains from trade for individuals, firms, or nations, which arise from differences in their factor endowments or technological progress. This simply means that a nation should focus on the production of a good where it has a cost or production advantage. Therefore, there is no need for the country to try to produce every type of product. Rather, the nation should focus on those products which it can produce cheaper and more easily.

Overall, there is a clear case for protecting young industries to boost local capacity. However, such policies should only be enacted when there is a sound economic logic supporting them and not simply to fulfil the fantasies of policymakers.

Rufai holds a first class degree in Management and Masters degrees in Management and Finance. He is a finance and strategy analyst and can be found on Twitter @LanreRufai_.

On Lionheart’s Oscar ban: Is Nigerian English a foreign language?

“US universities treat Nigerian English as a foreign language. The Oscars say it is not foreign enough”. s a linguist and former teacher of English, I have always wondered why Nigerian English has never been deemed official by law and recognised, in its uniquely identifiable variant, as different from British and American English. Its phonology (we stress the third syllable [ad-mi-RAL-ty] rather than the first [AD-mi-ral-ty], for instance), syntax (we say “let me be going” for “I have to leave now”; “senior brother” rather than “elder brother”; and “next tomorrow” rather than “day after tomorrow” etc.), and lexicon (words like “trafficate” and “overfloat”, all distinctly Nigerian) already qualify it as almost a different language. Why else, for instance, would foreigners say “pardon?”, “scuse me?” and “say it again” so many times when speaking to us?

I know why, of course. We are a colonised people so we retain a belief in the inviolability of the foreign English variant, even when we cannot successfully imitate it without creating a hilarious impression. We think that accepting a “Nigerian English” means conceding defeat and accepting a “ghetto “version of a language so graciously bequeathed to us.

But because language is dynamic, it was always bound to evolve into something else. British English is British English, but American English is something else, as is Indian English, Australian English or Kenyan English. Over time, we have evolved our own way of speaking — not Nigerian Pidgin, mind you, which is a totally different language and a creole — which is unique in every way. And yet we have not officially recognised it, encouraged it or even admitted that it exists in a way that could set us free from the constraints that have harmed rather than helped.

In our secondary schools, for instance, the Oral English syllabus still bases its teaching of sound pronunciations on the parameters of British English with a focus on stress patterns that

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make students laugh or wince rather than learn anything at all. Take any exam papers from WAEC and JAMB today and wonder why we still have the schwa when nobody ever uses it in real speech.

Our “above” is typically pronounced with the /a/ fully realised. Same with “across” and “away”. We pronounce “church” with a strong rounded vowel in the middle.

The English sound that makes it sound like “cherch” doesn’t quite work with Nigerian English phonology. And yet, students are penalised for not adhering to these British sound and stress patterns which they will never use as soon as they leave the class. Who knows how many of the people who make up the annual failure rates in English exams in Nigeria got there because they rhymed “lumber” with “bomber”?

Nollywood gave us a way out along with other means of artistic expression from Nigeria. Without regard to what the “original” language sounds like, Nigerian creatives have tailored their language and creativity through a uniquely Nigerian lens, giving us iconic characters from Sam Loco Efe, Joke Silva, Larinde Akinleye, Yemí Odunlade, Genevieve Nnaji, Omotola Jalade-Ekeìnde, Uche Jombo, Kúnlé Afolayan, among many others, whose cadence and rhythms of speech have become recognisable from a distance. Their artistic and creative oeuvre has established them and Nigerian cinema across the world but in their own language, culture, and artistic style which is uniquely Nigerian — even when occasionally expressed through the medium of English. It has put Nigerian English on the map in the way that the school syllabus refused to do.

So when Lionheart, a movie directed by Genevieve Nnaji, was disqualified for its Best International Feature Film category nomination at the Oscars because of an Academy rule that says “entries in the category must have ‘a predominantly non-English dialogue track’” — something that Lionheart lacks because its primary language was Nigerian English — it was worth asking again just

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how familiar American audiences are with creative works in the language to wield that rule with such ruthless certitude. They are within their right, to be clear, to decide what qualifies for certain categories.

But, as I argued on Twitter earlier, that Nigerian English is actually indeed a foreign language to most Americans — just as American English is deemed foreign to prospective Nigerian students — is an argument worth making.

I had to write the TOEFL exams before I was admitted to an American university for graduate school. The “F” in TOEFL stands for “foreign”, to suggest that the English language the students would encounter in the US is a foreign variant to the one they already speak. When I asked colleagues, a couple of years ago while I was in graduate school, if anyone in America would give me a job in a high school open only to “native speakers”, I was told no.

A native speaker, to Americans, means someone who was born or who grew up in America, speaking American English. Or someone from Great Britain. That’s it. Colonised by Great Britain for over a hundred years doesn’t quite count. You speak a different language.

The argument itself comes from an old attitude to the “purity” of language best codified by the Indian linguist Braj Kachru. He wrote in the mid1980s what is known as the Concentric Circles of English to explain the hierarchies that exist around the world today. Kachru describes an exclusive Inner Circle which contains only a handful of countries considered the “norm providing” societies whose citizens can be called “native speakers”.

These countries are the US, UK, Canada, Australia and New Zealand.

The Outer Circle follows, which contains societies where English is used as an official language.

Countries like Nigeria, the Philippines and India fit this description and are said to be “norm developing”, which means we take what we’re given from the inner circle and develop it further. We do not really “provide” or contribute to the development of

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KOLA TUBOSUN the language itself. The last circle is the Expanding Circle, which includes places where the language is merely adopted as an international language or language of trade (e.g. China, Korea, Japan, Greece, and Poland). These people are “norm dependent”.

They only take what they are given.

Speakers of English in any circle other than the Inner Circle are never to be considered native speakers, no matter their level of competence, which brings us to the real problem when applied to real-life scenarios. A typical Nigerian university graduate has spent 18 years going through an English-medium education, a language that has been used in Nigeria for at least 105 years.

By the time they are applying to attend graduate school at a university in the US, they can speak English fluently, have likely read and been tested on works by Shakespeare, Sóyínká, Achebe, Conrad or Wordsworth. They have read George Orwell, Virginia Woolf and Toni Morrison. By the time they complete the university application form, they are met with one last requirement: to write the TOEFL, a paper-based or web-based standardised exam.

It is described on Wikipedia as a test “to measure the English language ability of non-native speakers wishing to enrol in English-speaking universities.”

Emphasis mine. Without it, they are not deemed competent enough to complete a research or study programme in the US. Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng

Tubọsun is a linguist, writer, and scholar.

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BUSINESS DAY

Editorial In defence of dissent Publisher/CEO

Frank Aigbogun editor Patrick Atuanya

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

Bashir Ibrahim Hassan

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

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here is growing repression of dissenting voices in the current All Progressive Congress led government but the most pathetic part of this is that mostly young, uninformed Nigerians, whose future is being impacted, goaded by some amoral intellectuals who have bartered clear reasoning for a seat at the banquet table, are urging them down a path that will only have a disastrous outcome for Nigeria’s democracy.

Section 39 (1) of the 1999 constitution protects free expression and a free press. It is the same constitution from which the president gets his powers.

The media is the fourth realm and holds a unique position helping the public hold government officials accountable. This critical role is being undermined by this government in active connivance with sections of the public.

Buhari’s four years in office have been marked by incidents of journalists harassed and detained for doing their job. Buhari may have claimed to be a democrat, his actions belie that claim.

Taking a cue from him, state governors are now arresting and threatening journalists and

bloggers and even citizens who criticise them on social media.

We have discovered an even more insidious pattern of press intimidation by this government through paid agents including his Buhari Media Organisation.

These people have coalesced into a waiting army ready to be summoned at will to disparage media reports that appear critical of this government.

So far, social discourse has degenerated into virulent namecalling and savage attacks by these young people who have no idea that they are doing violence to their own future. Thomas Jefferson, third president of the United States, who also drafted the Declaration of Independence said, “the only security of all is in a free press.” We are undermining this security fighting for the vision of old people who won’t even be in the future they are shaping for a country where over 65 percent are 20-year-olds.

To put things in proper perspective, Buhari is fallible like everyone else and his ideas like everyone else must be subjected to critical evaluation. Neither economics nor business are strengths of Buhari. Unlike some ex-generals who sit on the board of companies or run large industrial farms and ranches, he left the army to hiber-

nate in Daura, his hometown.

Discourse about national issues should be civil and not always limited to puerile PDP/APC divisions. The United States, once a beacon of democracy is bogged down by partisanship that it can’t get much done. We are fast heading that way. Nigerians must learn to separate emotions and argue rationally. Since the education system is largely in tatters, this seems like a big ask. But each person has a duty to check his bias.

As Nigerians, it is our duty to demand for better governance and the media is an important vehicle to articulate this demand. We should not buy the false narrative that elevates poverty to saintly status and disdain wealth. Pain is not a virtue; lack is not evidence of piety. In the last four years, about 90 million people have fallen miserably poor and the bulk of these people feed the army of paid choristers singing Kumbaya to penury.

We are saddened by the fact that otherwise intelligent people who serve in this government have reduced public discourse to personal attacks. Social media aides of politicians now engage in gutter fights with strangers. Professionals who point out flaws in government policy are called “fencists” and “roadside economists”, their

cognitive abilities have since been impaired.

We warn that this vocal minority which includes false intellectuals are not only polluting public discourse,they are destroying the fabric of society and creating the conditions that will allow tyranny.

Under this government, the roar of civil society has been replaced by helpless barks, the judiciary once thought of as the last hope of the common man is now need of redemption, the press is being muzzled and calls for protests are crushed with the fury of angry thunders. This has bred hairbrained policies like the plan to regulate social media.

The media who hold government account must also behave responsibly. News must be reported objectively removing the journalist’s bias which we have watched seep into reporting by every media outlet including ours. To earn the tag opposition media is not a compliment any more than to be called a pro-government when ownership is private. The haste to break the news does not remove the obligation to be balanced, fair and accurate. As criticisms follow poor policies, praise should be credited to the government when it is due. This way the media can maintain a devotion to truth while checking tyranny.

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

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Effective strategy: Fulcrum of value creation in firms

Franklin Ngwu

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n a research on how value is destroyed in a firm, four main factors were identified as responsible. They include financial which accounts for about 14 percent, hazard about 19 percent, operations about 27 percent and then strategy about 40 percent. The research further shows that even though financials, operations and hazards are key factors that can cause value erosion in firms, their impacts can all be attributed to the (in)effectiveness of strategy. While this buttresses the importance of strategy, a key challenge or recurrent fundamental question is “Who Should Formulate the Strategy of a Firm?”

While it reads like a very simple question which I think it is, it is however highly misunderstood and wrongly answered across all industries in both public and private sectors in Nigeria. But what is strategy? There are many definitions, but a simple one is that Strategy is a set of plans to achieve the vision of an organisation. With this simple definition, the question then is who should formulate it? There are generally three approaches: Top-down, Bottom-up and Hybrid.

While top-down is the approach where the senior management and the board of directors formulate the strategy and cascade it down the line for execution, the bottom-up is somehow the opposite where the strategy is mainly formulated by the first line managers and their teams and then forwarded to the senior management and the board for

input and approval. The hybrid approach is a mix of the two. It is where the strategy is formulated by both the senior management and the first line managers (with high input and consultation of all their team members). In this approach, the final approved strategy is achieved and agreed through rigorous back and forth between the senior management and the first line managers who effectively represent their teams through effective communication and consultation. It is an approach that somehow involves everybody, or everybody feels a sense of involvement including the cleaners, gardeners, security guards and cafeteria staff.

Of these three approaches, which one should organisations use to achieve sustainable and long-term value creation and possibly market capture? Across organisations in all sectors in Nigeria, the one generally used is the Top-down approach. But the problem with this approach is not only that it is the dominant one, it is the way it is understood and applied.

One is that strategy formulation is perceived as a task mainly for the CEO and his senior management team with the board involved mainly for rudimentary approval or sometimes involved in the formulation.

Second is the way it is agreed and cascaded down. It is generally done with little or no input from the junior employees and even the first line managers. A middle manager in one of the financial institutions described it as a watered-down military instruction of which his only contribution with his team is compliance to execute the strategy.

Unsurprisingly, the financial institution downsized two times in one year!

In a recent Gallup report, 30 percent of employees are likely to be searching for new positions while at work. While 39 percent of employers think that their top performers might likely leave, 32 percent of firms lost their top performers. To add

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Using the topdown approach is arguably the reason why most organisations in Nigeria are characterised by in-effective management actions, increased cost and inefficiency, fire-fighting and reduced morale, and loss of key staff and customer, business interruptions and failure, poorly motivated staff and below average organisational performances

salt to injury, 75 percent of employees who voluntarily leave their jobs did so because of their managers. The question and one of the biggest challenges organisations face is how to engage with the ‘whole employee’. This is even worse in Nigeria where the level of employee engagement is only 12 percent with 65 percent of employees not engaged and 23 percent actively disengaged.

Using the top-down approach is arguably the reason why most organisations in Nigeria are characterised by ineffective management actions, increased cost and in-efficiency, fire-fighting and reduced morale, loss of key staff and customer, business interruptions and failure, poorly motivated staff and below average organisational performances. Moreover, in trying to resolve the above challenges, most Nigerian firms do not address the root causes. They focus on the symptoms and are seemingly incapable of properly identifying the root causes due to flawed mind-set that creates wrong corporate cultures.

A key cause of the above characteristics is the approach to strategy formulation and execution. If we recall that a formulated strategy is just a document that contains the plans of an organisation, the negative characteristics are unfortunately more observed not in the formulation of the strategy but in its execution especially when it fails.

What majority of Nigerian firms fail to realise is that you cannot properly execute what you did not formulate. Research reveals that 9 out of 10 firms always fail in their strategy execution. While only 5 percent of the workforce understands the strategy of their organisations, 85 percent of executive teams spend less than one hour per month discussing strategy. To properly execute therefore, you need to properly formulate. Of the three approaches to strategy formulation, the one with the highest possibility of resulting to effective execution is the hybrid approach. As it requires the involvement

of everybody in the formulation of the strategy, it instigates a high sense of responsibility and ownership not only during the formulation process but also the execution.

When practiced and embedded as part of the culture of the organisation, it mutates into a kind of movement as every employee irrespective of status feels that his/her voice is heard, and the brain utilised. The created sense of responsibility and ownership not only sustains a high level of interest and involvement, it also helps in the innovative mitigation of emergent risks (challenges and opportunities) common in strategy execution especially in a volatile business environment like Nigeria. In this scenario, just as the marketing director understands his/her contribution to the success of the organisation, so will the cleaners. Not only will they understand the contribution of clean environment to the success of the organisation, they will also be able to appreciate the need to be cost effective in their budgeting and recurrent expenditure given their involvement in strategy formulation and understanding of the need for cost minimisation in organisational growth and performance.

With the high sense of belonging created through a hybrid approach, the full creative and innovative capabilities of majority of the employees are unleashed to surmount all organisational challenges. If supported with a robust reward mechanisms and positive culture, the individual capabilities can be effectively galvanized to achieve sustainable growth and performance of the organisation through consistent value creation and market capture.

Dr. Ngwu is a Senior Lecturer in Strategy, Finance and Risk Management, Lagos Business School and a Member, Expert Network, World Economic Forum. E-mailfngwu@lbs.edu.ng,

Introduction to micro and early stage investment and the village ecosystem First in the series of Africa rising - courage and conviction What is conviction? onviction is defined as i) a firmly held belief or opinion and ii) certainty about a particular course of action or outcome. In summary, conviction is an idea or a belief you hold deeply and strongly. This is something you know, but may not have the research or evidence to back up.

What is courage?

Courage is i) the ability to do something that frightens one or ii) the choice and willingness to confront agony, pain, danger, uncertainty, intimidation or act rightly in the face of popular opposition. Courage refers to your ability to act. Courage is evidenced by action.

It is not hidden. It can be seen by others.

My convictions As we come to the end of this decade, I have been reviewing and analysing the progress and regress we have made in Africa, the missed opportunities, the challenges, and the emerging themes over the last 10 years. I entered this decade with so much optimism as Africa took giant steps forward in the previous decade (2000 to 2009). From the transition of military rule to democracy in most countries; to the gradual entrenchment of democracy (we will speak about the ideal form of government for us in the future); to the economic growth led by resource boom and some economic diversification; to the technology adoption led by mobile phone penetration. The stargazer part of me dreamt that Africa would put a man on the moon this decade (don’t roll your eyes at me ‘biko’).

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Instead of consolidating on the gains of the previous decade, Africa’s economic architecture and plans hit a slippery slope when the shockwaves from the financial market crisis in developed economies hit our shores with a bang. From denial by our governments on the potential impact of these shockwaves (and hence poor preparation) to the Ebola crisis, recession entered our daily dictionaries/lexicon and became ubiquitous. Even pets and wildlife in the Serengeti wanted a seat on the table to discuss the impact of this new word on them. And everyone blamed the other person: kids called parents, employees blamed employers, employers pointed the finger to governments, and governments blamed capitalists, capitalists mouthed off on derivatives. And as the recession’s rain is easing and we are beginning to see signs of sunlight, the global headwinds are rising again (with no obvious signs of a different attitude from everyone again). In summary, time has shown it waits for no one and the decade is over and oh yes, China won this lap.

A new decade beckons and watching my 16 year-old daughter prepare to go into college, seeing the over 5,000 students that attended the Techmoney conference at The University of Lagos, and digesting the view from a plane as I take off from Lagos and land in other African cities; my convictions begin to haunt me to the point of courage. “Will you Dr. Akintoye Akindele do anything about me? Will you keep waking up and going with your economic activity and writing pieces on leadership, suc-

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cess and finance for another decade?” (That is my conviction asking me questions).

The voice is now too loud to ignore. What are these convictions?

Everyone acknowledges that human talent is our largest and best resource in Nigeria and on the continent. The question is, are we investing enough in this significant resource? Are we educating them enough? Skilling them? Tooling them? No, we are not; and we are quick to point fingers at the government. There are c.38 million students in Nigeria1 (over 204 million students in Africa) with 5 percent in tertiary education, 27 percent in secondary education and 68 percent in primary education. Out of this number, 85 percent are in public institutions and 15 percent are in private institutions. The quality of education in these private institutions (across all levels from primary to university) range from basic to decent with a very few of them comparable to international standards. The public schools in Nigeria (and most of Africa) are a shame to this generation. In this age, children in most of these schools do not have books to read, or enough teachers. Some do not have chairs to sit or tables to write on. Schools that do have teachers do not have teaching tools and aids. It is utterly disappointing.

Nigeria’s education budget (excluding capital expenditure) in 2020 is $1.4bn (c.$87bn in Africa), which is on a par with the budget amount of $1.3bn allocated for fuel subsidy; and we produce oil - God help us. This works out as $36 spent per student! I can go on bashing the government, but I do not see an

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AKINTOYE AKINDELE upside to that activity. The fact is the Nigerian government cannot (both ability and capacity wise) solve this problem.

In comparison, there are currently c.90,000 Nigerian students5 studying abroad (c.520,000 African students studying abroad6) with 82 percent enrolled in tertiary education and 18 percent enrolled in primary, secondary and non-degree education; with parents spending c.$4.1bn - 3x the government’s 2020 education budget – on their children’s education.

This works out as $46,000 spent per student.

There is a huge disparity between what the government is allocating to education in Nigeria and what parents are already spending on educating their children.

(To be continued) Dr. Akindele is an investor, entrepreneur, lecturer and philanthropist. He is the founder of Synergy Capital Managers and Advisers. Dr Akindele is also a faculty member at the University of Lagos Business School, lecturing on finance and entrepreneurship.

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Wednesday 11 December 2019

BUSINESS DAY

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Nigeria inches towards self-sufficiency as NIDO launches modular rice mills for farmers Josephine Okojie

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igeria in the Diaspora Organisation (NIDO), Asia chapter in collaboration with Kanryu In d u s t r y o f Ja p a n , h a s launched modular rice mills for smallholder farmers and small-medium enterprises to move the country towards s e l f-s u f f i c i e n c y i n r i c e production.

The modular rice mill which was launched recently in Lagos and Abuja is a compact machine that has the capacity of processing 110kg of paddy rice per hour.

Emenike Ejiogu, president of NIDO- Asian chapter, said during the launch that the move to introduce the modular rice milling machines was necessitated by the Federal Government’s appeal to Nigerian professionals and business owners in the diaspora to contribute to national development and nation-building.

Ejio gu adde d that it was also necessitated to support the government’s self-sufficiency drive in rice production and put a stop to the era of foreign varieties by ensuring that Nigerians

Inomata Hiroaki; Anonuma Taira; Yaguchi Hideyuki, all of Kanryu Industry Limited in and Ochade Osekwe, PRO, NIDO - Japan chapter during the launch of modular rice mills for smallholder farmers in Lagos recently.

consume good and quality rice.

“We are launching these modular rice milling machines to see how we can articulate and help in the area of technology, skills, and finance in driving economic growth and national development,” he said. “ This modular small milling machines are very easy to maintain and affordable for smallholder farmers,” he stated.

“We choose rice because it is one of the most-consumed staple foods in the country

and the government has been looking for ways to attain selfsufficiency in its production,” he further said.

He noted that Asia has almost the same altitude as Nigeria and as the largest producers of rice, the country must adopt its technology and practice in the production of the crop.

“We decide to domesticate foreign rice in Nigeria and since we live in Asia, where technology is key especially in Japan, we located a company that is willing to come and not only transfer the technology

Lagos APPEALS empowers 1,600 agripreneurs with training Josephine Okojie

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he Agro-Processing, Productivity Enhancement and Livelihood Improvement Support (APPE ALS), Lagos State chapter has projected to empower over 1,600 agripreneurs with training within the next two years through its Women and Youth Empowerment Programme (WYEP) scheme.

Oluranti Sagoe-Oviebo, the state project coordinator of APPEALS, stated this recently in Lagos during the opening ceremony of the flag off of the training programme.

According to a statement, the two-week intensive residency training programme, which started last week Sunday, is being held simultaneously in Lagos and Ogun states for agripreneurs across various commodity value chains.

Oviebo further disclosed that the project was one of the highlighted strategies

by Ibijoke Sanwoolu, wife

of the governor of the Lagos State, during the 19th National Women’s Conference – which is part of the state’s plan to ensure the implementation of its THEMES agenda through women empowerment and job creation.

She added that the empowerment programme included capacity building in enterprise development, agribusiness training in the chosen value chain of interest and provision of technical assistance.

She noted that the capacity building programme would be supported by grants to finance sub-projects and mentorship for start-ups or consolidation of existing women and youthled businesses as individuals or group beneficiaries.

“The WYEP is designed for the unemployed and underemployed women and youths to facilitate income generation and improved livelihood of the beneficiaries,” Oviebo said.

“A t o t a l o f 1 , 6 2 0 beneficiaries with 10 percent of People With Disabilities www.businessday.ng

(PWD) inclusion out of over 7,000 persons who expressed their interest during the competitive selection process of the programme are to benefit under this scheme,” she further said.

Breaking down modalities for the training, the state project coordinator said beneficiaries have been divided into batches for efficiency and optimum utilisation and best value from the training institutes based on their capacity and facilities.

A total of 350 beneficiaries were randomly selected to kick-start the two-week training programme in two Institutes: Araga Training Institute in Epe, where poultry and rice value chain agripreneurs will be trained, and Aquatic hub in Asero, Abeokuta, for training of entrepreneurs in the fishing industry.

Oviebo welcomed the beneficiaries to the institute and implored them to open up their minds to the training as well as making the best use of the opportunities provided.

but also teach us best practices in rice production,” Ejiogu who is an engineer and a professor, explained.

“We aim to make the era of foreign rice a bygone so that Nigerians will enjoy the quality of rice they desire and decrease smuggling,” he said.

“Nigeria has what it takesthe land, resources, and manpower to grow enough rice. We want to bring the technology starting from rice milling to backward integration of growing rice,” he added.

He noted that part of

the discussions of NIDO with Kanryu Industry – manufacturers of the modular mills, is to ensure that a mechanism is put in place to start increasing local content of the modular mills in the country, adding that train the trainers have already being trained to transfer this knowledge.

“The professionals are already in place such as fabricators, programmers, engineers who are taking over the operations,” he said.

He called on the g overn ment to supp o r t smallholder farmers and small businesses in the area of finance through the Bank of Industry to be able to purchase the milling machines.

Speaking also, Ochade Osekwe, PRO, NIDO- Asian chapter and chairman, Nigeria Chamber of Commerce and Industry, Japan said: “NIDO - Asian chapter is bringing in technical partners from Japan to showcase how we can incorporate modular rice milling facility in Nigeria.” “ Thes e machines w e are bringing are as good as having integrated rice mills. It can mill, destone, husk, and polish. The only difference is just that the quantity is lower than integrated mills,” Osekwe

said.

He advised farmers to form clusters to purchase four or five of the machines for their operations, adding that the introduction of the mills will create employment and positively impact the Nigerian economy.

He added that farmers will be trained on the use of organic manure brought from Japan that will be mixed with locally produced manures to get higher yields per hectare.

Speaking on behalf of Kanryu Industry, Taeho Park, managing director of the organisation said that the machine is currently being used in Thailand – a global top rice exporter.

He said that the modular mills are specifically manufactured for long-grain rice and the Nigerian market, adding that it has the husking, milling, and destoner that separate broken from head rice.

“Usually most rice machines give 30 to 40 percent of head rice but this machine gives up to 70percent of head rice,” Park said. “ We h av e t e s t e d i t thoroughly since we came into Nigeria. We have two typesone running on generator and the other on power,” he added.

Scientists advocate re-establishment of National Agricultural Land Development Authority SIKIRAT SHEHU, Ilorin

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cientists under the aegis of the Soil Science Society of Nigeria (SSSN) recently called for the re-establishment of the country’s National Agricultural Land Development Authority to tackle the high rate of land degradation in the country.

They said that the current level of land degradation in the country stands at about 60 percent of arable land and 30 percent of forest.

Bashiru Raji, a professor, a n d p re s i d e nt o f S S S N disclosed this in Ilorin, the Kwara State capital while briefing journalists ahead of this year’s World Soil Day. Raji revealed that under the Land Degradation Neutrality Target Setting Programme (LDN TSP) a princely sum of N194 billion is needed to restore the country’s degraded lands by 2030 to the pre-2015 scenario.

He hailed the Federal Government for its giant and

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visible strides and gains in the agricultural sector within the last four and a half years.

“For these gains to be sustained and for the attainment of seven sustainable development goals (SDGs) the FG needs to keep faith with the action plans of LDN TSP,” he said.

“The government should also consider reestablishing the moribund National Agricultural Land Development Author ity (NALDA) to scientifically coordinate the on-going land development under the agricultural transformation agenda; existing regulatory policies such as the National Erosion and Flood Control Policy, Nigeria’s Agricultural Promotion Policy 2016-2020, Great Green Wall and National Economic Recovery Growth Plan 2017-2020 should be leveraged upon to accelerate restoration of degraded lands and prevent future occurrence,” he added.

He stated that the SSSN @Businessdayng

would through the Nigerian Institute of Soil Science evolve a national soil policy for the sustainable exploitation of the country’s soil resources.

“The society is ready to partner with Nongovernmental Organizations (NGOs) and community-based organisations (CBOs) to create awareness among the public on the effect of unsustainable use and misuse of the fragile ecosystems as they affect the capacity of the soil to render valuable ecosystem services like food security, groundwater purification, waste disposal, climate change mitigation among others,” he further said.

The soil scientist attributed incessant failure of road in the country to dearth of laboratories and nondeployment of indigenous soil scientists by foreign construction companies.

Raji attributed the short lifespan of some highways in the country to failure of monitoring and management and not that of science.

Wednesday 11 December 2019

BUSINESS DAY

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AGRIBUSINESS ag@businessdayonline.com

Policy bolsters Nigeria’s oil palm makers’ revenue in third quarter BUNMI BAILEY

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he Federal g o v e r n m e n t ’s policies may have led to the increased earnings for palm oil makers in the third quarter of 2019—the first time in the year in which they reported stronger revenue performance.

“In the first two quarters, we had a lot of problems in having to sell our products locally,” Graham Hefer, managing director of Okomu Oil Palm, said while reacting to the recently released thirdquarter results.

Hefer said that after the Nigerian government shut its land borders, the impediments to sales faded off as there was a loosening of grip by illegal imports, creating an opportunity for the company to market its products more easily.

Nigeria shut its border with Benin in August to curb the smuggling of rice, palm oil, and petrol. So far, there have been reported increases in local rice production, though this is matched by price rises.

But the policy also seems to have raised sales of palm oil makers, increasing their capacity.

According to the numbers released by the two listed

firms in the industry, Presco, and Okomu, combined sales revenue nearly doubled to N11.8 billion in the third quarter of the year, from N7.7 billion in the preceding quarter.

Findings from the Q3 financial results of listed firms like Okomu Oil Palm revenue increased massively year-onyear by 89.9 percent to N7.0 billion in q3 2019 from N3.7 billion in q3 2018. Presco’s revenue increased marginally by 4.3 percent to N4.8 billion in q3 2019, from N4.6 billion in the same period of last year. “ I f you l o o k at t h e i r performance in the third quarter, it was good compared to the first and second quarters which was terrible.

So, because of the border closure, their revenue and their company’s performance have improve d,” Abiola Gbemisola, research analyst at Lagos-based Chapel Hill Denham said.

According to Gbolahan Ologunro, an equity research analyst at Lagos-based CSL Stockbrokers, there was scarcity of palm oil in the market due to shortfalls in the level of supply when compared with the level of local demand in the economy.

“So what we saw from them was that they were in a better

position to push more of their products to the market. And they also took advantage of the border closure by increasing their prices marginally since consumers had no option than to patronize the locally produced oil.

“But I think that Okomu felt the impact more than Presco due probably a larger market share and better quality of products,” Ologunro added.

Palm oil is derived from the fruit of the oil palm tree, which is grown in tropical regions of Asia and Africa.

Nigeria spends close to $500 million on the importation of the commodity annually, according to Central Bank’s governor, Godwin Emefiele.

While the importation was to meet the increasing local demands of a country once adjudged as the world’s largest exporter of oil palm in the late ’50s and ’60s, it negatively impacted the performance of local oil palm producers.

Palm oil producers benefited from the blacklisting of some 41 items including oil palm by the Central Bank

MOUAU churns out 96 first class agricultural graduates

Agro-Industrialisation seen as Nigeria’s escape plan from economic sabotage Josephine Okojie

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he agriculture sector powered by industr ialisation is Nigeria’s bailout from the economic sabotage laying hold on the success of agribusinesses in the country, say experts.

The experts who spoke at the Farm2Fork Dialogue event which was held recently in Kwara State said that the country cannot grow its agriculture and other sectors when it becomes fully industrialised.

Richard-Mark Mbaram, c h i e f e x e c u t i v e o f f i c e r, AgroNigeria and coc o n v e n e r, F a r m 2 F o r k Dialogue, described the realities of Nigeria’s economy as ‘Prodigal’ and remarked that agriculture is Nigeria’s get-out-of-jailfree card.

While lauding the closure of Nigeria’s land borders

by the President as a bold and decisive step, Mbaram noted that at the level of constructive engagements, there was the need for a few more active steps.

According to him, this was what infor me d the Farm2Fork Dialogue; t o c re at e l o ng -s t a n d i ng solutions to the i mp e d i m e nt s h i n d e r i n g agro commodity businesses in the country.

“The Farm2Fork Dialogue is not a talk shop; we are here to dimension custom-fitted solutions to challenges bedeviling Nigeria’s agribusiness,” he said in a statement.

He further stated that actualising the commodity ecosystem of the nation’s dreams must be prioritized for any meaningful transformation to occur.

For Nigeria to leapfrog to the Fourth Industrial Revolution in agriculture, experts at the event pointed www.businessday.ng

out that there needs to be an activation of a knowledgebased economy and proliferation of existing technologies across the various value chains.

Banji OyelaranOyeyinka, a professor and special adviser to the African Development Bank President on Industrialization, on his part described Agroi n d u st r ia l i sat i o n a s t h e t i c k e t f o r j o b c re a t i o n , adding that successful agricultural transformations are business-led.

He stated that agriculture is not just a sector, but a collection of technologies.

On his part, Ade Adefeko, chairman, Agricultural Trade Group of the Nigerian Association of Chambers of Commerce, Industr y, Mines and Agriculture (NACCIMA), also reiterated the need to conduct a sectoral diagnosis for any real change to occur.

of Nigeria in 2016 when dollar shortage fostered local demand of the agro-product.

But the gains were short-lived as they complained of a high intensity of smuggling which negatively affected their sales.

In the first six months of this year, Presco recorded a 10.3 percent dip in revenues and while Okomu’s fell by33.3 percent.

According to analysts, the reason for the decline was due to the favourable weather conditions in the world’s largest crude oil palm

producing countries such as Malaysia and Indonesia which had higher yield and production of oil palm.

This further led to lower crude palm oil prices in the international market making i mp o r t at i o n o f t h e raw product cheap to import.

“Global palm oil prices were lower so it was easier to import. And because of the import restrictions in the country, people would go to the neighbour ing countries like Benin Republic and smuggle them into the country,” said Gbemisola who was earlier quoted.

Oil palm price in Nigeria is believed to be relatively higher than international prices primarily due to import restriction on the commodity following the introduction of the Central Bank of Nigeria list of 42 foreign exchange excluded items in 2015.

According to data sourced from Bloomberg, oil palm prices trended southwards to $2,040/metric ton on June 18th, 2019 from $2,368 on August 15, 2018.

Despite the improvement in their revenues, it was not enough to reverse the decline in sales of their first nine months as Presco’s sales declined by 5 percent and Okomu’s was reduced by 7.7 percent.

“Right now, there is no converg ence, and there is no-nexus regarding transiting to this revolution, and honestly, our research institutions are not fit for purpose,” Adefeko said.

“What we need is a robust approach and a potpourri of Agric entrepreneurs to put things into perspective,” he added.

Reiterating this charge in her address, Princess Roseline Ibitoye, president of the Cocoa Association of Nigeria (CAN) noted that the cocoa industry has been neglected by both past and present governments.

She added that there is a need to put the cash crop back on track as the leading agro commodity in the country.

The various agricultural organisations present at the event urged the government to extend more physical and mechanisation support to farmers across the country.

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UDOKA AGWU, Umuahia

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ichael Okpara University of Agriculture, Umudike, Abia state has churned out 96 firstclass agricultural graduates during the 9th convocation ceremony of the University over the weekend.

Out of 6,214 Bachelor’s Degrees, 96 graduated with first-class Honours, 1,826 made second class upper division while 2,935 obtained second class Lower division in various agricultural courses of the school.

Ab o u t 1 , 2 6 4 p e r s o n s garnered third-class whereas 93 obtained pass.

Francis Ogbonnaya Otunta, professor of Mathematics, and the vicechancellor of the University, said a total of 788 graduated during the 2017/2018 session with higher degrees as follows : 142 obtained their Ph.D., 420 got MSc, 14 @Businessdayng

graduated with MBA and 71 made MEd while 141 received their PGE/PGDE degrees.

Otunta noted that MOUAU focuses on functional, sustainable, excellencedriven and productive research culture.

He disclosed that the Institution was facing infrastructural and physical d i f f i c u l t i e s w h i c h w e re some of the hindrances to providing quality education for students.

“There is, therefore, a crying need for a significant infusion of funds for upgrade of our physical environment, especially when it is realized that this University is among those that started with the disadvantage of not having a take-off grant from Federal government,” he said.

“Our internal roads are failing as a result of increased population on the campus and use of heavy vehicular e q u i p m e n t ,” t h e v i c e chancellor added.

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Wednesday 11 December 2019

BUSINESS DAY

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Wednesday 11 December 2019

COMPANIES & MARKETS

BUSINESSDAY

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COMPANY NEWS ANALYSIS INSIGHT

ECONOMY

Three reasons why inflation is likely to rise in November & what it means for you SEGUN ADAMS

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he prices of goods and services in Nigeria have been on the rise since August following a controversial land border closure.

Currently at 11.61 percent, a 17-month high, inflation is expected to go higher in November-and here’s why.

Seasonality Historically, inflation usually rises at the end of the year, thanks to the festive season.

In November last year, annual prices increased by 11.28 percent or 0.02 points higher than in October 2018.

With the exception of 2017, 2014 and 2010 where inflation slowed in November, and 2011 where it was unchanged, the last decade supports the view of higher price levels.

The reason inflation usually rises in the late months of the year is because people want to spend a lot at those peri-

ods, and (with goods not as many) this causes price to go up.

Border closure The closure of the border has cut off supply of some staple food items including rice, poultry and tomatoes.

Food prices in October rose the fastest since April

2018 because of the limited availability of the items restricted from entering Nigeria from Neighbouring countries.

Because these items are highly demanded for in this period, it is expected that price for these items will rise, pushing food inflation up and ultimately overall inflation.

Insecurity States in the food producing middle-belt and northern regions have reported disruption to farming activities due to conflicts. This affects supply and ultimately drives prices north.

Economists at Access Bank Plc expects inflation

pressure on already weak purchasing power, as the same amount of money now buys less. By the same token, it reduces real wage of workers in the economy which dampens consumption and leads to slower sales for companies, especially those in consumer goods space.

Benchmark interest rate might remain unchanged at 13.5 percent.

If inflation continues to rise further, it may also force the CBN to consider raising benchmark interest rate to compensate for any decline in real yields and keep foreign portfolio investors happy.

For individuals with savings account in a commercial bank, higher inflato hit 11.9 percent in No- tion would mean that the vember 2019. This would money sitting in the bank be the highest since April would have a lower value.

This is especially true last year. given that outlook for inAnalysts at Cardinalflation going forward is for Stone expect inflation to higher price level considbe at 11.82 percent yearering some fiscal adjuston-year in November. ments like expected hikes

Why rising inflation in electricity tariffs and should matter to you? VAT, and new minimum Rising inflation puts more wage in 2020.

FIXED-INCOME

T-Bills may crash further as CBN plans two surprise auctions ahead of Christmas OLUWASEGUN OLAKOYENIKAN

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he Central Bank of Nigeria (CBN) is planning to raise an additional N52 billion from two treasury bills sales before the end of this year, in a move that could worsen the interest rates on the instruments for investors but allow the bank raise cheaper debts for the federal government.

The CBN will raise N5 billion, N10 billion, and N30 billion across the 91day, 182-day, and 364-day papers on Thursday, December 12, respectively.

Also, it is expected to sell another N2 billion each across the 91-day and 182day bills, as well as N3 bil-

lion on the 364-day papers on Thursday, December 17.

The auctions, which are aimed at rolling over maturing papers, are contained in the T-Bills calendar released by the Debt Management Office (DMO) for the first quarter of 2020. This is coming after the calendar for the last quarter of 2019 had shown that the financial regulator would no longer conduct any T-Bills sales this year.

However, with robust system liquidity buoyed by last week’s under-subscription of OMO bills, and lowinterest-rate environment on the short term government securities, the CBN’s surprise plan to return to the T-Bills primary market before the year runs out

may not be out of place for a government aiming to cut the cost of borrowing, particularly after rates on the instruments crashed to the lowest since January 6, 2016, at the last auction.

The financial system liquidity stood at N744.17 billion last week Friday, no thanks OMO maturities which could be reinvested into the CBN’s liquidity management tool following its restriction of local non-banks and individual investors from participating in the OMO market.

Consequently, investors bid a paltry sum of N190.8 billion on CBN’s N400 billion OMO sales, leaving more than half of the offer unsubscribed.

With another N493 billion

OMO maturities expected to hit the market this week, analysts at United Capital

expect yields to crash significantly at Thursday’s TBills auction as there are no

signs that the excess liquidity will reduce considerably before the auction.

L-R: Obasi Eziaku Rita, principal, Alpha Rehoboth College; Moturayo Olusanya, head, quality assurance, Chi Limited, and Amit Aneja, category head, juice, nectar and still drinks, Chi Limited during the presentation of Brand of the Year Award to Chivita 100% at the Global Quality Excellence Award to mark the World Quality Day in Lagos.

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Wednesday 11 December 2019

BUSINESS DAY

COMPANIES&MARKETS INDUSTRIALS

Bosch bullish on Nigeria operations, set to create more jobs for Nigerian youths OLUFIKAYO OWOEYE

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espite the challenging operating environment, Bosch Nigeria has reiterated its commitment to creating more jobs for Nigerian youths to address the challenges of youth unemployment.

This was made known during a media chat at the national finals of iCreate festival held in Lagos recently.

Managing Director, Robert Bosch, Nigeria, Ghislain Noumbessy attributed the decision to support iCreate festival to the organization’s

dedication towards building competences and skills of the people in the regions the company operates.

Noumbessy explained that since 2008, Bosch has been one of the main participants of “Afrika Kommt”, an initiative that grooms young Africans to become future managers of Africa, while disclosing that Samson Ajayi, Retail and User Marketing Manager, Bosch Power Tools Nigeria, was once a participant in the “Afrika Kommt”.

Speaking further on the reason behind partnering with iCreate Africa for the 2019 iCreate festival, Ajayi emphasised that Bosch is committed to creating jobs in

Nigeria to curb the issues of youth unemployment.

“Bosch is passionate about the development of the communities where it operates.

We are long-term oriented, and we believe that one of the ways we can contribute to solving socio-economic issues in Nigeria is mainly to support organizations like iCreate to encourage people to acquire skills and re-orientate people that having a skill or building your livelihood on a set of skills is not a mistake”, he stated.

Ajayi emphasized that Bosch will continue to seek sustainable partnerships targeted at enhancing the livelihood of the Nigerian youths.

GOVERNMENT BUSINESS

Lagos state set to launch science, tech and research council … to disburse N250m initial investment DAVID IBIDAPO

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agos state is set to launch its first science, technology and research council which reiterates its goal to becoming a smart city and an innovation hub in the country and the government is equipped with the innovation masterplan which will highlight the government focus on critical areas to unleash the culture of problem-solving initiative.

This was revealed by the governor, Babajide Sanwo-Olu at the maiden edition of the art of technology Lagos 1.0, themed “bridging the gap” held in Lagos on Thursday. He said that Lagos state which is presently a socio-economic hub of Nigeria has commenced its journey to becoming a smart city which will be enabled with the use of technology as it has become a game-changer of the status quo.

He said the government is investing the sum of N250 million as a seed fund to kick-start activities in the council which will be headed by the vicechancellor of the University of Lagos, Oluwatoyin Ogundipe.

“Our administration is committed to releasing and top charging problem-solving potentials through innovation in science and technology; we are prepared to provide Lagosians with the opportunity to connect on a global space” “The science, research and innovation council which will be responsible for the management of the science research and innovation fund and is primarily tasked with investment in research, development and technology including robotics, artificial intelligence, green energy and informatics as part of its tools to reforming Lagos, the governor also said that it will be launching programs and policies that will help achieve the vision which includes data

accessibility which enables innovators get tools and critical ingredients that will engineer purposeful solutions, updated curriculums that mark industry needs, infrastructure improvement and building of a comprehensive technology ecosystem, an open government initiative which will make data accessible to innovators and a functional solutions hub.

“With this administration activity in these areas, the innovation ecosystem will surely receive the needed boost to make contributions to the economy. These will commence this year or early next year” Sanwo-Olu said.

Also present at the event was Hakeem Popoola Fahm, commissioner for science and technology, Lagos state, who said Lagos is embarking on a journey to become a smart city and requires a sustainable framework as well as the adoption of technology in order to manage it’s affairs

L-R: John Osuoha, country manager, Chartered Institute of Securities and Investment (CISI); Femi Jaiyeola, chairperson, finance committee, Compliance Institute, Nigeria (CIN); Pattison Boleigha, president, Compliance Institute, Nigeria (CIN); Praneet Shivaprasad, senior international manager, Chartered Institute of Securities and Investment (CISI), and Isioma Gogo- Anazodo, chairperson, programme, education examination committee, Compliance Institute, Nigeria (CIN) , at the signing partnership agreement between CIN and CISI.

L-R: Temitope Olateru, key accounts manager, Abuja, NB Plc.; Onyebuchi Nwangwu, brand manager, STAR Lager; Musician, SkiiBii; Kenneth Ajakaiye, regional trade marketing manager, Abuja, NB Plc., and Alex Lawal, North and East zone key accounts manager, NB Plc., at the Access The Stars Abuja Concert.

L-R: Adeleke Hassan, registrar, CIAN; Etop Ikpe, CEO, Cars45; Prince Lekan Fadina; , Jogun Onabanjo, CEO, United Auction House; Mohammed Iyamu, vice president, business-to-business services, Cars45, and Adewumi Onanuga, chairman, CIAN, Lagos Chapter, during Etop’s investiture as a distinguished fellow of the Certified Institute of Auctioneers of Nigeria, CIAN in Lagos

Blackstone eyes innovative ways to bridge Nigeria lending gap IFEOMA OKEKE

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lackstone Capital Limited has reinstated its commitment as a Finance Institution to primarily to bridge lending gaps in the activities of Nigerian Commercial Banks to individuals and small businesses in the wake of Nigeria’s renaissance as Africa’s business hub.

The company which prides itself as an innovative retail finance institution offering lifestyle products and services that suit the financial needs of our multi-segmented clientele base, commenced business in April 2019 with a firm commitment to change the face of micro-lending in Nigeria.

While, Ressdiva is an indigenous company established to provide competent support services in key sectors such Marine Services, Oil and Gas and General Contracting and

has its major clients includes Nigerian Port Authority, NIGCOMSAT, INEC, SAHCOL, CHEVRON, Border Development Community Agency BDCA. Elizabeth Kings-Wali, the founder, Blackstone Capital, Ressdiva Integrated Services Nigeria Limited (RISNIL) said at Blackstone, the company prides itself as being tenacious, responsive, unique, service oriented and transparent (TRUST) in all our dealings.

“Our vision is to remain the leading most cost effective and innovative retail financial institution in Africa. The company will be reckoned as the most trusted, competent and profitable credit service provider in Lagos by 2024.

“We are poised to take over the market through our bouquet of innovative loan products, ease of loan accessibility, flexibility and pricing,” Kings-Wali said.

According to her, “our services are delivered in a targeted way that puts into consideration our corporate relationships and clients’ preferences because we place a premium on inspiring trust and building lasting relationships through each individual customer life cycle.

“We have a team of likeminded people, mutually driven and supportive of each other.

Our staff are friendly, creative and positively motivated towards collectively creating value for all our stakeholders.”

She assured that Blackstone Capital Limited will continue to provide unsurpassed service and the best value for money to its customers who are offered innovative loan products, ease of loan accessibility, flexibility and pricing.

Speaking further about Ressdiva Integrated Services Nigeria Limited, she said that their services are top notch.

L-R: Yinka Tiamiyu, chairman, Association of Chief Audit Executives of Banks in Nigeria (ACAEBIN); Adam Nuru, managing director, First City Monument Bank (FCMB), and Amarachukwu Okogbue, divisional head, group internal audit of the Bank, during the Quarterly General Meeting of the Association hosted by FCMB in Lagos.

L-R: Deji West, chief financial officer, Oladiran Olusegun Adebutu Foundation; Olusegun Adebutu, founder, Oladiran Olusegun Adebutu Foundation; Bamidele Abiodun, wife of the governor Ogun State; Kemi Sokenu Morris, chief executive officer, Oladiran Olusegun Adebutu Foundation; Salamotu Gbajabiamila,wife of the speaker, Federal House of Assembly, and Gideon Adetoye, Liken of Ibefun, Unveiling the Caroline Oladunni Adebutu Serenity Center during the Empowerment Programs organized by Petrolex Impact Investment Network (PIIN) 2019 in Collaboration with Oladiran Olusegun Adebutu Foundation held at International College, Ibefun, Ogun State.

Wednesday 11 December 2019

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cityfile Ikoyi Passport Office goes tough on touts

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Cross section of beneficiaries of the Conditional Cash Transfer of National Cash Transfer programme, at the 2019 international anti-corruption day event, theme “Highlighting the Impact of Using Recovery Asset to Alleviate Poverty in Nigeria” at Kuje area council in Abuja.

Pic by Tunde Adeniyi

Victim of suspected IED relive experience in Ebonyi hospital NKECHINYERE OGINYI, Abakaliki

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hukwu Chibuike, 16-year SS2 student of Glory Land High School in Ebonyi local government area of Ebonyi State, hit by the suspected Improvised Explosive Device (IED) which went off last week, has had his left hand amputated following the incident.

This is also as the state government has banned the sale and use of fire crackers (knockouts) in the state.

Medical experts at the Alex Ekwueme Federal University Teaching Hospital Abakaliki (AE-FUTHA) successfully conducted the amputation of the teenager’s hand.

When Cityfile visited the hospital on Monday, Chi-

buike was lying critical at the children’s ward of the federal teaching hospital.

Chibuike alleged that the object suspected to be explosive device was brought to the school by his classmate identified as Mogbo Afan believed to be a son of a mobile policeman serving in Ebonyi State.

Recall that there was pandemonium at the Ezugwu area of Ebonyi State last Thursday when an object exploded in the school and chopped off Chibuike’s hand, leaving other students critically injured.

The incident, which occurred around 9:am, threw the school into a state of panic and teachers and students to vacate before the normal closing hours.

Speaking from his hospital bed, the teenager denied that he brought the explosive device to the school.

He told Cityfile that Mogbo Afan, his classmate who brought the object to the school escape immediately the danger struck.

“This incident happened around 9:am. One of my classmates, Mogbo brought an object that looked like an electric bulb which had black colour cover. He removed the cover and I was inside the classroom while he was on the stair case very close to our classroom. When he removed the cover of the object, the object fell from his hand to the floor.

“I rushed to pick it up and throw way thinking it was an ordinary ‘knockout’ so that it doesn’t blow in the classroom and scare us in the class. So, I picked it and it immediately exploded on my hand and chopped it off like this. I also sustained leg injuries.

“The boy is a son to a

policeman; his father is a MOPOL officer. When the incident happened, students scampered for safety and I was taken to one of the teachers in our school. They loosed my belt and tied it on my hand. My father was contacted and he came and took me to the hospital.

“The boy ran away immediately the object exploded and till today, he has not been found. His mother and father have been coming to hospital to see me. They usually cry and plead for forgiveness”.

The victim’s father, Chukwu Nwani, a native of Okposi Okwu, Ohaozara local government area of the state, said he was not happy that his son would lose one of his hands as a result of the action of another student in his school.

He, however, solicited for government help to give the boy adequate medical care.

a n i r Ya r i , the Passport Control Officer (PCO), Ikoyi Passport Office, Lagos, says the office will no longer tolerate the activities of touts within the office vicinity Yari said in Lagos, noting that the office aimed to completely eliminate the activities of the touts by 2020.

“The touts usually double-cross innocent citizens on their way to the centre promising to get them international passports.

“Such promise, most times, never worked thereby ending up in duping the citizens,” he said.

The PCO, therefore, advised Nigerians desirous of obtaining international passports to visit the cen-

tre directly.

He further said the passport office would strengthen its existing structures to improve service delivery in 2020.

According to him, “the particular area we plan to intensify effort on is curbing the activities of quacks who hijack applicants.

“The office had taken some measures already but the measures would be intensified come year 2020.

Yari further promised to exceed 2019 delivery by issuing more passports to applicants in 2020.

“Since the issuance of e-passports started in Ikoyi more than 50,000 passports have been issued to applicants for passports with both five years and 10 years validity,’’ he stated.

Court remands ex-policeman for killing truck driver

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n Akure Chief Magistrate Court on Monday remanded a 37year ex-policeman, Omosuyi Idowu, for allegedly killing a truck driver.

The chief magistrate, Charity Adeyanju, ordered that Idowu, who at the time of the incident was in the police force, should be remanded at a correctional service centre pending his bail application.

Adeyanju adjourned the case until December 27 for mention.

The defendant is facing a charge of manslaughter.

Earlier, the prosecutor, Uloh Goodluck, told the court that the defendant committed the offence on December 2 at a checkpoint at Uso, in Owo local government area of Ondo.

Goodluck told the court that the defendant shot the driver, Ado Saleh, on his head with an AK47 rifle.

The offence, he said, contravened Section 316 of the Criminal Law of the Ondo State of Nigeria, 2006.

Defence counsel, Ademola Ikujuni, urged the court to adjourn the case to enable him to study the case file.

burst kidnappers’ EFFC secures jail terms for 84 in Edo, Ondo, Delta Police camps in FCT ... recovers N217m IDRIS UMAR MOMOH, Benin

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enin zonal office of the Economic a n d Fi n a n c i a l Crimes Commission (EFCC) secured the conviction of 84 persons in Edo, Delta and Ondo States between January and November, 2019.

The anti-graft agency also recovered a total sum of N217,268,236 million from corrupt individuals in the zone.

Muhtar Bello, head of

the zone, disclosed this during a road walk in commemoration of the World Anti-Corruption Day which held in Benin, Edo State, on Monday. The theme of the walk was “united against corruption.

According to Bello, various properties, including houses and vessels were also forfeited by the convicts. He listed states comprising the zone to include Edo, Delta and Ondo.

He added that between 2015 and 2019, the comwww.businessday.ng

mission secured a total of 1,636 convictions across the country, including the convictions of former governor, Joshua Dariye of Plateau State, Jolly Nyame of Taraba State and that of Orji Uzor Kalu, the former governor of Abia State.

Bello, who noted that the World Anti-Corruption Day was in line with the United Nations General Assembly resolution on October 2003, noted that the road walk was to draw attention to the conse-

quences of corruption and the need to combat the menace.

He affirmed the determination of the zone to win the fight against corruption through diligent investigation and prosecution.

Bello added that as part of the agency’s preventive measures, enlightenment campaigns were organised for members of the National Youth Service Corps (NYSC) at their various orientation camps, as well as secondary schools and higher institutions within the zone.

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he police in Abuja have dismantled kidnappers’ camps and arrested a suspect along Kwali-Kwaita axis of the territory.

The deputy police public relations officer in the FCT, Mariam Yusuf disclosed this in a statement.

She said the camps were dismantled during Counter-Kidnapping Operations in furtherance to the command’s efforts to wipe out kidnappers from the FCT, particularly along Kwali-Kwaita axis.

@Businessdayng

Yusuf said that the operation, using overt/covert means dismantled the camps and dislodged the kidnappers’ bases prompting them to seek refuge.

“The fleeing kidnappers while scampering for safety entered the highway shot at an oncoming vehicle and killed four persons along that axis.

“The intervention of police operatives led to the immediate arrest of one of the suspected kidnappers while efforts are on top gear to apprehend his cohorts,” she said. NAN

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Wednesday 11 December 2019

BUSINESS DAY

Wednesday 11 December 2019

BUSINESS DAY

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Award Recipients at the BusinessDay Top 100 Fastest Growing SMEs in Nigeria, in Lagos

Agro Eknor Limited

Lekki Farms

Page Financials

The Nuli Juice Company

Kaptain Foods Limited

EZ37 Solutions Limited

Tranter IT

LS Scientific Limited

Zuriel Consulting Limited

Blue Camp

VIISAUS Technology Limited

Sotvic Investments Limited

Dolphin Swim School

Gova Design

D207 Designs & Projects

Medplus

Doculand Business Solutions Limited

BookingsAfrica.com

Max.ng

Travelbeta

Landwey Investment Limited

Ayaoba Fabrics

Jamel Technical Limited

Novarick Homes & Properties Limited

The Penthouse Law

Views Channel

Digital Marketing & Investment Limited

Rage Media

VanPeux Global Synergy Limited

Media Technology Pictures by David Apara

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Wednesday 11 December 2019

BUSINESS DAY

MARITIMEBUSINESS Shipping

Logistics

Maritime e-Commerce

Nigeria needs bigger ports to handle increasing trade volumes, says ex-minister … Lists Ikot Abasi, Ibaka Badagry as natural harbour sites amaka Anagor-Ewuzie

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mmanuel Iheanacho, chairman, Integrated Oil and Gas Limited, and former Minister of Interior, has called on the Federal Government to expand the nation’s ports infrastructure, access roads leading to ports and to ensure effective connection of the seaports to the hinterlands.

Iheanacho, who expressed concern over the state of the nation’s transport infrastructure amid the increasing trade volumes in the ports, stated that the nation had to improve its transport infrastructure to meet the 4 percent annual increase in world trade volume, which has also affected Nigeria.

Speaking at the day-two of the just concluded National Transportation Sum-

mit organised by the Chartered Institute of Transport Administration (CIoTA) Nigeria in Abuja last week, he said that the shipping in-

dustry has played a significant role in taking millions of people out of poverty.

Therefore, he urged, Nigerian government to in-

vest more in infrastructure in order to create wealth and allow Nigerians feel the impact of the enormous opportunities in

NPA joins EFCC to preach accountability, fight against corruption amaka Anagor-Ewuzie

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s part of its effort to embrace transparency and accountability in port business, the Nigerian Ports Authority (NPA), in collaboration with the Economic and Financial Crimes Commission (EFCC) on Monday embarked on a sensitisation walk aimed stemming the tide of corruption and cyber crime in the nation’s seaports and Nigeria generally.

The walk, which was held in commemoration with this year’s International AntiCorruption Day themed, ‘Zero Tolerance to Corruption,’ was organised in conjunction with the Nigerian Maritime Administration and Safety Agency (NIMASA), Nigerian Shippers’ Council (NSC) and the National Union of Road Transport Workers (NURTW).

Hadiza Bala Usman, managing director of the NPA, said the walk was an initiative taken to strengthen collaboration with other government agencies in the fight against corruption.

According to her, the maritime industry has come together against corruption

because we believe that there was need for us to embrace transparency and accountability across board in all our operations.

Usman, who stated that corrupt practices were unacceptable, as they bring about economic mismanagement, said the inter-agency synergy with the EFCC was important in pushing the frontiers of anti-corruption in Nigeria.

“We have opened our operations to EFCC and we believe that there was need to entrench within our oper-

ations across the board, what is required to strengthen integrity and accountability,” said Usman.

Ibrahim Magu, the acting chairman of the EFCC said the fight against corruption calls for concerted efforts towards eradicating the menace in the country.

According to him, the EFCC cannot pretend that it has the monopoly of wisdom or strategy to single handedly fight against corruption.

“Corruption can only be tackled when there is collaboration by all stakehold-

Hadiza Bala Usman (2nd r), MD, NPA; Mohammed Rabo (3rd l), zonal head, EFCC, Lagos; Joe Okei-Odumakin (r), president, Women Arise for change and Campaign for Democracy; Sokonte Davies (l), ED, Marine and Operations, and other stakeholders during the 2019 World Anti-Corruption Day Walk in Lagos. www.businessday.ng

ers in fighting the menace,” he said.

Represented by Muhammed Rabo, zonal head of the EFCC Lagos office, Magu urged all stakeholders to embrace values that promote accountability and transparency at all levels.

Hassan Bello, executive secretary/CEO of NSC said the council has been in the forefront of fighting corruption in Nigerian ports.

To him, NSC has been working to ensure processes at the ports are automated to reduce instances of corrupt practices to the barest.

“Corruption thrives when there is face-to-face interaction between the service providers and consumers.

But, when the processes are automated, there will be no interface,” said Bello, who was represented by Samuel Vongtau, director of special duties.

Dakuku Peterside, director general of NIMASA, who was represented by Victor Onwuzurike, director, internal audit, said the agency has zero tolerance to corruption, and also an anti-corruption unit that actively responds to any complaint relating to corrupt practices within the agency.

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shipping.

Noting that Nigeria’s revenue base has grown as a result of crude oil sale over the years, he warned that it would be wrong to continue to spend such revenue on imported goods, rather than improving the size of ports available in the country.

He listed places such as Ikot Abasi and Ibaka both in Akwa Ibom as well as Badagry, Lagos as natural sites for harbour.

“We have to maximise these ports for our need as well as to serve landlocked countries like Chad. Nigeria should look at the trade needs and develop ports to serve those needs. The demand factor we should focus on is the underlying trade,” he said.

According to him, “How do we compare the volume of trade in 1959, 1969 and consistently over the years?

If trade has doubled over the years, then there is need

to have ports infrastructure improved proportionally.”

“What improvement has been made on the Lagos port access roads over the years? On Creek Road in Apapa, there are numerous obsolete buildings that the government could buy, demolish and convert those places into marshalling areas for cargoes. What we advocate is dynamism. We have to consider these options,” he suggested.

I h e a na c h o h ow e v e r called on CIoTA to see the annual 4 percent growth in world trade as an avenue to position the nation’s transport sector to benefit from the opportunities trade provides.

Meanwhile, Bashir Jamoh, president of CIoTA, said that as support for government, the institute would take up the responsibility of advocacy to address the numerous challenges in the transport sector.

WACT donates teachers’ quarters, waste disposal skips to communities amaka Anagor-Ewuzie

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he West Africa Cont a i n e r Te r m i n a l (WACT), Onne, Nigeria’s most efficient gateway to markets outside Lagos, has donated 10 units of self-contained apartments for use as teachers’ quarters to Ogu Town in Ogu/Bolo Local Government Area of Rivers State.

The company also donated 20 waste disposal skips to Onne community, Rivers State.

Aamir Mirza, managing director of WACT, said the donations were part of the terminal operator’s Corporate Social Responsibility (CSR).

“Onne and Ogu communities have been very supportive to the growth of WACT, not only in providing quality staff, but also in resolving issues,” said Mirza, who was represented

by Lewis Sarpong, WACT’s chief financial officer, during the donation last Wednesday.

On the teachers’ quarters, he said WACT built the accommodation to ensure that teachers that were posted to Ogu have good accommodation.

“When the teacher is sound, he goes to the classroom happy and able to impact knowledge @Businessdayng

into the children. We need teachers that come to this place to feel comfortable,” he said.

Handing over the waste disposal skips, Mirza said the 20 skips will help to tackle waste disposal and promote environmental cleanliness. “We are handing over 20 skips paid for

by WACT to the community so that the community can place them at strategic locations to manage waste.”

Appreciating WACT, King Nicholas Dickson Ibiebele Niminebo Loko IX, the Amanyanabo of Ogu Kingdom, said the new building will be of tremendous help to the community and serve as a boost to the educational system in the area.

King Dennis Osaronu, the paramount ruler of the Onne, said WACT has demonstrated a high sense of responsibility by providing waste disposal skips to the community. “If these skips are properly used, we shall notice few cases of cholera in the community because the refuse will be disposed accordingly.

“There are some communities and LGAs that don’t have single skip but today, we have 20,” said Osaronu, who was represented by S.N Jiala, chairman, Council of Chiefs.

Wednesday 11 December 2019

BUSINESS DAY

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MARITIMEBUSINESS Shipping

Logistics

Maritime e-Commerce

How Nigerian ports will benefit from NPA’s new pact with Port of Antwerp amaka Anagor-Ewuzie

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ast week, the management of the Nigerian Ports Authority (NPA) signed a 5-year partnership agreement with the management of the Port of Antwerp International (PAI), Belgium to tap from the existing technical know-how of one of the world’s leading ports in order to enhance efficiency of operations in Nigerian seaports.

Under the agreement, which is expected to last for five years with effective from the 27th day of November, 2019, the Port of Antwerp will play an advisory role with regards to enabling further development of Nigerian ports.

Both port authorities signed Memorandum of Understanding (MoU), which is expected to strengthen the bilateral relations between the two countries.

The MoU, which covers areas like infrastructure, stimulation of trade growth as well as concretising the enabling environment for the tenets of Public Private Partnership (PPP) to thrive among the two Ports, is also expected to broaden technical skills and practical knowledge needed in managing operations in the Nigerian ports.

According to the team

L-R: Emmanuel Adesoye, chairman, NPA Board; Kristof Waterschoot, chief executive officer, Port of Antwerp Int’l APEC; Sokonte Davies, representative of the managing director and executive director, Marine and Operations, NPA, and Daniel Dargent, ambassador of Belgium, during the official signing of MoU between Nigeria and Belgium at the NPA Corporate Headquarters in Lagos.

from Port of Antwerp, they see greater future in the NPA as it makes progress in its concessioned regime, thus, the MoU. At the MoU signing ceremony in Lagos last Wednesday, Hadiza Bala-Usman, managing director of the NPA said the new agreement was geared towards building a bilateral relationship that would be mutually beneficial to both countries.

Usman, who was represented by Sokonte Davies, executive director, Marine and Operations of the NPA, said the partnership was in line with the vision of the management of the NPA of making Nigerian ports, a leader in

Africa, owing to the fact that Belgium port, is the second leading port in Europe and 12th in the world.

She said the MoU would give the Authority the opportunity to tap from the wealth of experience that PAI has exhibited in Europe, expressing optimism that the partnership deal will grow the mutual aspirations of the two countries.

“Port of Antwerp and Nigerian ports share few similarities especially in the area of having industrial locations within the ports. We believed that we can leverage on these experiences to position our ports for positive use and to

manage logistics chain addition to the port,” she said.

Usman, who stated that the NPA also hopes that this relationship can become a new model in future relationships between ports, said both port authorities are expected to partner in branding and marketing.

“This would help to promote each other’s interest and utilise advantages both the NPA and PAI have,” she said.

Earlier, Daniel Dargent, Belgium Ambassador to Nigeria, who said that the visit to the NPA was part of the third trade missions of Belgium potential investors to Nigeria this year, also stated that the

new agreement provides both countries with an opportunity to expand its trade volume.

According to Dargent, the trade volume between Nigeria and Belgium presently stands between 2.5 to 3 million Euros per year, and there is hope that the volume of trade exchange between both countries would increase as a result of this new partnership.

“We see a lot of potential in the port of Lagos due to Nigeria’s growing economy. The freight transport with Europe has increased substantially. By means of this collaboration, we can use our know-how to advise the port of Lagos in its further development,” said Kristof Waterschoot, chief executive officer of PAI. He said the agreement underlines the ambition of PAI to consolidate and further develop its already strong position in West Africa.

“With annual volume of 16 million tons, West Africa takes a large share in the traffic of Port of Antwerp. It is therefore our ambition to further strengthen our position in West Africa,” said Annick De Rider, president Port of Antwerp, Rider however said that management of the Port of Antwerp aims to pass their know-how and experience to the NPA by virtue of the MoU. “We hope that this mission will create new fruitful con-

tacts, new connections and new business opportunities in order to ensure future growth for years to come. We are engaging ourselves to create a sustainable future for African Ports,” Rider added.

Emmanuel Olajide Adesoye, chairman, Board of Directors of the NPA stated that the industry expectation is that the two organisations would leverage on each other’s expertise for growth in trade, which would result in economic development for the two nations.

Port of Antwerp, which is located in Belgium, has significant impact on European trade given the fact that European Union has one single market. The Port is not only serving Belgium but also serving Germany, France, Switzerland, Austria and even, Italy.

BusinessDay understands Port of Antwerp has Belgium as home but serves customers in the whole of North-West European region. It is known in Africa as the maritime centre of Europe because of its numerous supply chain connections.

Also, out of all ports in North-West Europe, Antwerp has the highest number of direct services to West Africa, resulting in a market share of nearly 50 percent and freight of 15 million tons, which Nigeria has the highest volume of 6 million tons annually.

ernment by creating another agency in CRFFN. “We have written letters to Senate and House committee members, warning them of the looming constitutional crisis that would arise as a result of the amendment of the CRFFN Act in line with the intention of few,” he said.

He however described the letter from the governing council of CRFFN, which directed NAGAFF to ensure that its members withdrew the ongo-

ing appeal on or before 20th of December, 2019, as threat.

Boniface Aniebonam, founder of NAGAFF, who confirmed that CRFFN is not government agency, described the council as a ‘baby’ of NAGAFF. According to him, the attempt to amend CRFFN Act was done to destroy CRFFN and that was why some members of NAGAFF went to court to challenge and seek interpretation of the status of the council in line with the provisions of the Act.

NAGAFF raises alarm over attempt to transform CRFFN to govt agency amaka Anagor-Ewuzie

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orried by the future of freight forwarding community, the National Association of Government Approved Freight forwarders (NAGAFF) have raised alarm over the plans to transform the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN), to government agency.

Speaking to newsmen in Lagos on Monday, Okwudili Alagbu, legal counsel to NAGAFF, said there was an ongoing effort at the National Assembly to amend the enabling Act, establishing the CRFFN and to transform it to government agency.

According to him, there was an ongoing litigation in court, demanding for the interpretation of some critical sections of the CRFFN Act especially for the court to interpret the

www.businessday.ng

‘self same provision of the Act’ and determine if the council is a government agency or not.

Alagbu, who insisted that the CRFFN was not a government agency, said the Court had earlier stated in its judgement that the Council is not a government. “The Court gave interpretation to the case, some in favour of NAGAFF but some were against. But, we filed an appeal immediately to contest the judegment, and the appeal has been ongoing.”

“CRFFN cannot be a government agency when 23 out of its 40-member governing Council were elected, the chairman must come from the 23 elected members, and the Council is self funded, through members’ registration and practicing fees.

Stating that democracy thrives on separation of powers and rule of law, Alagbu, called the National Assembly to avoid an attempt to create additional financial burden to the gov-

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Wednesday 11 December 2019

BUSINESS DAY

Corporate governance Corporate performance and stakeholder treatment: Building a symbiosis Olayimika Phillips

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ithout question, profit maximisation is the key consideration in the set-up of most business concerns. However, companies often fall to the temptation of overly focusing on only those activities aimed at generating revenue, ensuring maximal returns on investment for its shareholders and catering for the welfare of its directors/ management without taking into account the impact of their activities on stakeholders beyond the immediate corporate structure, or devoting resources to gain a clear understanding and/or satisfy its obligations to these stakeholders.

To build a thriving, yet reputable business it is necessary, as a matter of sound corporate practice, for companies to put in place a functional stakeholder accountability mechanism. The validity of this proposition is unquestionably universal. Most business owners notionally understand that the success or failure of their businesses may be influenced by factors beyond liquidity and market forces of demand and supply, including goodwill public trust and confidence and community relations among others. Rather curiously, whilst some have not fully grasped how to acquire and apply these invaluable business assets, a lot more do not see the utility of investing in stakeholder engagement. Quite predictably, they pay steep prices down the line.

In simple terms, stakeholder engagement and accountability cover the different ways a company stays true and connected to individuals or parties who would be affected, directly or otherwise by its activities and policies. Typically, the stakeholders include the employees, customers, suppliers, service providers, professional advisers, host-communities, governments and regulators. Whilst the directors, shareholders and the managers are regarded as the immediate internal stakeholders of the company, there is an overriding consideration, fundamentally driven by the dictates of sound corporate governance practices, that the internal stakeholders should take into account the interests and welfare of the external

stakeholders in all its dealings and, at all times, assess the level of impact of their activities on these stakeholders.

For instance, let us consider a company which is in the business of manufacturing highly demanded consumer goods. At every stage right from business conception, the manufacturing process to sale to final consumers, the company interacts with different stakeholder across the value chain. Sourcing raw materials for the production process may not only impact the environment, people livelihoods may also be affected in ways which are collateral to the bottom line of the business.

The company will engage professional advisers, suppliers, employ labour, regularly engage with the relevant regulators, as well as the immediate community. This company must take care to ensure that all these stakeholders are afforded the best possible treatment.

Though failure or neglect by a company of the interests of the external stakeholders may not have an immediate palpable negative effect on the profit margins of the business, its long term impacts are unquestionably dire. A dissatisfied workforce, a hostile host community, advisory services from unpaid or incompetent professionals etc. will certainly coalesce into irreversible brand erosion, reputational damage, potential legal liabilities and ultimately the unravelling of the company.

As demonstrated above, lack of proper stakeholder engagement and understanding coupled www.businessday.ng

with inadequate resolution of stakeholder’s concerns may prove disastrous to the overall success of a company. Stakeholders often have the ability to influence the success (or failure) of a company at various levels. In recent times, shareholders and potential investors also regularly assess and evaluate the overall corporate strategy (aside mere review of the financial portfolio)-including a company’s stakeholder engagement model before coming to an informed investment decisions.

Primarily, the objective of stakeholder engagement is to build relationships with stakeholders to understand their perspectives and concerns on key issues and to integrate those perspectives into the company’s corporate strategy. In addition, it is also important to state that there is value associated with stakeholder engagement comprising: enabling an informed board and management decision making, avoiding or reducing business risks due to better business intelligence, developing and expanding business opportunities, brand value and reputation and bringing diverse perspectives together to facilitate innovation; all of which help drive long-term sustainability and shareholder value.

In as much as public companies (especially listed public companies) often devise a more detailed stakeholder engagement plan for its operations, it is desirable for private and closely held companies to consider adopting

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viable stakeholder engagement model as part of its overall corporate strategy. Aside incorporating this model into the core part of its business, the companies should daily treat its external stakeholders right, especially its business partners, as reasonably expected in a business transaction. All business transactions should be devoid of financial dishonesty and a lack of business commitment; a consistent pattern of which has the potential to destroy the brand and reputation of a company in the wider business community.

Given the growing calls for institutionalisation of more socially responsible corporate culture and market preference for companies that have meaningful direct societal impact on their immediate communities, it is necessary for new and private companies to formulate and integrate a comprehensive stakeholder engagement plan into their governance structure to advance the interests of the stakeholders. More often than not, companies are unaware of the negative effects of neglect of stakeholders concerns on its business operations; it is thus necessary for companies desirous of achieving steady growth in a sustainable way to at all times painstakingly consider the implications of their various actions and policies on stakeholders and work towards advancing the interests of the stakeholders. Stakeholder’s dissatisfaction is mostly a self-created monster which, if not properly managed, is capable of wreaking havoc in many a business. @Businessdayng

Olayimika is a Partner in the law firm of Olaniwun Ajayi LP and has over 34 years of professional experience. She specializes in corporate governance, providing pragmatic solutions to the diverse challenges which confront corporates at different growth stages and serves on the board of several companies (listed and privately held).”

Wednesday 11 December 2019

BUSINESS DAY

PENSION today

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In Association With

Legislators, operators see need for collaboration to drive growth in the pensions industry …want FG to appoint board for PenCom

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he need for collaboration between the legislatures and players in the pension industry has been emphasised as critical in addressing some of the critical challenges facing the sector, as well as to stir growth in the industry now in the future.

The stakeholders who deliberated during the 2nd Annual Retreat organised by the Pension Fund Operators Association (PenOp)) for the National Assembly Joint Committees For Establishment And Public Service of The Senate and House Of Representatives Committee On Pensions held in Uyo, Akwa Ibom State believes that industry has the potential to grow bigger and support economic development.

In a communiqué issued at the end of the Retreat, the meeting applauded the strides made by the pension industry since the pension reforms of 2004.

According to the statement signed by the PenOp president, Ronke Adedeji, chairman, House Committee on Pension Maters, Hassan Rurum; and chairman Senate Committee on Establishment And Public Service of the Senate, Ibrahim Shekarau “the nation has transited from an unsustainable scheme into one that is beneficial to contributors and the nation at large but agreed that more needs to be done to enable the pension industry to benefit more Nigerians.

“As at 30th September, there were 8.85 million registered participants in the contributory Pension Scheme; and N9.58 trillion assets under management, which has been deployed in critical sectors of the economy. There are also 298,614 retirees on the scheme, with 227,400 on programmed withdrawal, and 71,214 under annuity, while 59,057 death benefits have been paid.”

The meeting also noted that whilst the industry has greatly improved access to retirement benefits, more needs to be done to enable the pension industry to benefit more Nigerians in this regard, the meeting resolved to institutionalize a working relationship between the legislators and the pension industry.

A major highlight of the communiqué was the decision to engage the executive

L-R: Daisy Ekineh, trustee member, Pension Fund Operators Association of Nigeria(PenOp); Bamidele Salam, deputy chairman; Ibrahim Shekarau, chairman, Senate Committee on Establishment and Public Service; Aderonke Adedeji, president, PenOp; Hassan Rurum, chairman, House Committee on Pension Matters; deputy chairman, Senate Committee on Establishment and Public Service; Ehimeme Ehioma, head, surveillance, National Pension Commission(PenCom) and Wilson Ideva, MD/CEO, High Street Consulting at the Workshop for Joint Committee for Establishment and Public Service of the Senate and House of Representative Committee on Pensions held in Uyo, Akwa Ibom, State.

to prioritize the payment of accrued rights of pensioners as many pensioners are unable to access their pension contributions because of non-payment of accrued rights.

The meeting also resolved to find ways to ensure that state governments are compliant with the provisions of the Act, as many of them are noncompliant Another major decision was the resolve to work together on amendments that need to be made to the Pension Act of 2014 to improve the workings of the pension industry.

“Improved legislation should ensure that the industry doubles its asset at least every five years, the meeting agreed.

The meeting also agreed that the operators need to continue their engagement with the private sector and the government to increase the level of infrastructure investment for pension assets while not compromising safety of retirees’ funds The meeting also called on the federal

government to constitute a board for penCom. An honest assessment of the perception and believe of a large number of Nigerian workers on the country’s Contributory Pension Scheme (CPS) no doubt shows positive, sustainable and also a system that breeds a lot of confidence.

CPS which came following the enactment of the Pension Reform Act 2004 and revised in 2014 elicit strong enthusiasm and hope for contributors who are looking forward to a comfortable old age.

They believe generally that not only would they get their pensions when they retire from formal employment, but that it would enable them pay their bills and live a healthy life in retirement.

The objectives of CPS is to ensure that every person who worked in either the public Service of the Federation, Federal Capital Territory, States and Local government or

the Private Sector receives his retirement benefits as and when due ; and to assist improvident individuals by ensuring that they save in order to cater for their livelihood during old age.

The provisions of this Act shall apply to any employment in the public service of the Federation, the public Service of the Federal Capital Territory, the Public Service of the state, the public service of the local governments and the private sector.

In the case of the Private Sector, the Scheme shall apply to employees who are in the employment of an organization in which there are 3 or more employees.

Notwithstanding the provision of subsection (2) of this section, employee of organization with less than three employees as well as self-employed persons shall be entitled to participate under the scheme in accordance with provisions on micro pension plan.

IS NOW RC634453

Diamond Pension Fund Custodian Limited 1A, Tiamiyu Savage Street, Victoria Island, Lagos State.

Tel: 01-4613753, 2713680, 2713954 Fax: 01-2713955 Email: info@accesspfc.com Website: www.accesspfc.com

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@Businessdayng

This section is created to increase awareness and deepen knowledge about the Contributory Pension Scheme.

If you have enquiries or contributions, send to this e-mail: accesspfcbusday@yahoo.com

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Wednesday 11 December 2019

BUSINESS DAY

insurance today

E-mail: insurancetoday@businessdayonline.com

Agric insurance receives a boost as players target five million farmers for coverage Modestus Anaesoronye

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nsurance companies offering agric insurance for the Nigerian market targets to provide coverage to a minimum of five million framers over the next two years. There are currently 14 insurance firms providing this service.

Insurance companies underwriting agriculture insurance hope to provide cover for five million farmers in the next two years, Ken Aghoghovbia, DMD/chief operating officer, African Reinsurance Corporation, made the disclosure at Africa Re and International Finance Corporation (IFC) agriculture insurance workshop held in Lagos.

He posited that the first index insurance program was written in 2017 for NIRSAL rice scheme where four underwriters NAIC, AXA Mansard, Leadway and IGI provided insurance to the scheme supported by lead capacity from Africa Re., stressing that a total of 14,589 farmers were covered during the wet season program and that since then approximately 191,626 small scale farmers have been insured on six major index schemes.

He expressed optimism that within the next two years, the challenges facing the Nigerian insurance industry in the implementation of agriculture index insurance contracts to farmers will be a thing of the past.

“In order to adequately address the pain points of our stakeholders in the agriculture insurance space, we reached to our clients individually to collate their needs, one of it turned out to be this five day technical workshop that kicks off today,” he said.

Aghoghovbia said Nigeria has immense economic potential and applauded the Federal Government Initiatives that triggered the 2012 Agricultural Transformation Agenda and set the ball rolling for the insurance in-

Ken Aghoghovbia, DMD/COO, African Reinsurance Corporation

dustry to tap into the opportunity, through provision of affordable insurance products to farmers whilst at the same time guaranteeing food security.

He noted that Africa Re’s role as the largest reinsurer in Africa has been put to test with the need to provide adequate reinsurance capacity to the Nigerian insurance industry, a feat that has seen the number of approved agriculture underwriters increase to 14 as of today.

“Initially, agriculture insurance products in Nigeria were provided on indemnity basis with the attendant high costs of administration and inherent risks of fraud. Thus Nigerian underwriters over the years have faced challenges in the implementation of indemnity based insurance contracts, a turn off to insurance penetration. In an attempt to address the challenges posed by indemnity products, underwriters sought to introduce index insurance in Nigeria,” he posited.

According to him, underwriters still face challenges even in the implementation of index insurance contracts for farmers. Key among them, he said include, basis risk out-

WAICA Re Ekundayo inducted Fellow of West African Insurance Institute Modestus Anaesoronye

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biola Ekundayo, group managing director, West African Reinsurance Corporation (WAICA Re) has been inducted as a Fellow of the West African Insurance Institute.

The investiture, which took place at the 2019 Graduation Ceremony of the Institute in Banjul, Gambia was in recognition of Ekundayo’s leadership role in growing WAICA Re to its present status as well as its contribution to insurance growth and development of insurance in, especially, west African countries.

Ekundayo started his insurance career in 1984 with a brokerage firm and later moved to WAPIC Insurance Company Limited, before joining Globe Reinsurance Plc in December 1989. He was appointed Executive Director in 2000 and was later confirmed as the Deputy Managing Director in 2001.

In 2007, he became the Managing Director/ CEO of the company.

His experience as insurance practitioner covers large areas of the profession including brokerage, marketing, underwriting, reinsurance, investment and risk management. He piloted the company to the Francophone countries in the West Coast thus making Globe Re the first Nigerian Reinsurance

Company to do business with the Francophone world, being a bilingual Executive.

He has varied and a broad spectrum experience in executive management and technical educational fields having attended courses, both locally and internationally.

These include leading the team course at Lagos Business School, Reinsurance Strategic Management at the prestigious Wit Business School, University of Witwatersrand, Johannesburg, South Africa and Managing People Effectively at D & B Business Training Services, London.

He graduated from the Lagos State Polytechnic where he studied Insurance and holds a Masters Degree in Business Administration (MBA) from Lagos State University, he is a fellow of both Chartered Insurance Institute London (with specialization in reinsurance) and Chartered Institute of Marketing of Nigeria.

WAICA Reinsurance Corporation Plc is a public limited liability company incorporated under the laws of Sierra Leone (Companies Act 2009) on 7th March 2011.

In the years following the creation of West African Insurance Companies Association (WAICA) in 1973, the founding fathers had the desire to establish a reinsurance organisation to help mitigate the effects of the lack of reinsurance capacity within the West African insurance industry. www.businessday.ng

comes, absence of reliable historical yield data sets, non-compliance by farmers to standard farm agronomy practices as well as policy terms and conditions, affordability of premiums by farmers, unreliable crop cuts assessments and inadequate reinsurance capacity.

Senior Financial Sector Specialist, International Finance Corporation (IFC), Shadreck Makumo, urged agric insurers not to promise farmers what they knew cannot be covered as this can lead to conflict when claim arises. “Don’t promise what you cannot cover to your clients, so that, you don’t end up giving excuses at the point of claims payment,” he posited.

Such fake promise, if not fulfilled, could

make the farmer nurse the belief that underwriters don’t pay claims and that, when such information is circulated among the people, it creates a negative image for the entire Insurance industry, he added.

He implored agric insurers present at the conference to embrace best practices and avoid cutting corners, especially, in the area of product pricing, he foresee a great potential for agric Insurance in the Nigerian market.

He called on stakeholders in the agric space to work harmoniously, while urging farmers and insurers to abide by the tenets of utmost good faith by embracing total disclosure during buying and selling of agric insurance contract.

L-R: Gbenga Ogunkanmi, member Osun State House of Assembly; Ganiyu Musa, MD/CEO, Cornerstone Insurance; Funmi Babington-Ashaye, MD/CEO, Risk Analyst Insurance Brokers and chairmain board of Trustees of AOF; Ayo Ogunkanmi, Lawyer and son of the late Tunji Ogunkanmi; Wole Fayemi, ED, Guinea Insurance and Rasheed Bolarinwa, head, Media Polaris Bank at the 5km Walk at the University of Lagos organised by THE Adetunji Ogunkanmi Foundation (AOF), a non profit organisation set up by former staff of Cornerstone Insurance in memory of the late founding managing director of the Company

Cornerstone ex-employees honour late founder Ogunkanmi 19 years after

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non-profit organization, the Adetunji Ogunkanmi Foundation (AOF) which was set up by the former staff members of Cornerstone Insurance Plc. in memory of the company’s founding Managing Director/CEO, Adetunji Ogunkanmi has held a 5km walk at the University of Lagos Sports Centre tagged: “Walk for Tunji”.

According to the Foundation who is the organizer, the charity walk took off at the University of Lagos Sports Centre, Akoka and was within the University premises.

The walk which is aimed at remembering the legacy of the charismatic Tunji Ogunkanmi is also meant to amplify his ideals for the young generations to emulate.

Adetunji Ogunkanmi

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The walk afforded the Foundation to make a presentation to the late Ogunkanmi’s alma mater, the Insurance department of the prestigious institution.

The occasion was also be used as an opportunity to flag-off the program of the 20th anniversary of his demise which will come up on the 5th of December, 2020.

Adetunji Ogunkanmi Foundation Board is chaired by a frontline insurance practitioner and former Managing Director of Cornerstone Insurance Plc, Funmi Babington- Ashaye who commented on the programme, said, ‘’our coming together is a demonstration of the impact of the visionary leadership of Tunji and the need to keep the ideals which he stood for alive as they are still relevant in this present time” adding further, ‘’we want the walk to be used as a means of keeping fit and creating a platform of coming together of like minds in a relaxed and progressive atmosphere’ The Adetunji Ogunkanmi Foundation was established in 2018 with a vision of keeping alive Tunji Ogunkanmi’s ideals and also help to develop the insurance industry through provision of scholarships to outstanding and indigent students of insurance in tertiary institutions across the country.

AOF was also set up to create a platform for setting the tone for thought leadership with the ultimate goal of creating a better and informed society.

@Businessdayng

Wednesday 11 December 2019

BUSINESS DAY

27

insurance today E-mail: insurancetoday@businessdayonline.com

Leverage tech to help close the protection gap, insurers urged Modestus Anaesoronye

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he Insurance Development Forum (IDF), a public/private partnership led by the insurance and reinsurance industry, has called for greater use of technology to close the global protection gap.

The global protection gap (disparity between economic and insured losses post-event) is staggering and growing, and exists in both developed and developing parts of the world.

Generally, the lack of insurance penetration globally is seen as a huge opportunity for insurers and reinsurers to innovate and develop effective and affordable solutions that meet the very real and urgent protection needs of individuals, from all corners of the world.

In a recently published paper, the IDF has said that technology is a potential

L-R: Oluwatoyin Ogundipe, vice chancellor, University of Lagos; Jude Modilim, executive director, Technical Operations, Sovereign Trust Insurance plc and Esther Adegbite at the 2019 Staff Dinner & Awards Ceremony of the Faculty of Management Sciences, University of Lagos.

game changer in the efforts to close the protection gap, but warns that re/insurance sector as well as stakehold-

ers must take advantage of advancements and calls for laws and regulations to keep pace with change.

CIIN Inductees charged to be professional, innovative disrupters for increased consumer value Modestus Anaesoronye

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he Chartered Insurance Institute of Nigerian (CIIN) weekend inducted five Fellows and 143 Associates into its professional fold, charging them to be professional and innovative disruptors that will make insurance a necessary part of the citizen’s financial planning tool.

The inductees, who were presented with certificates of honour having qualified in the institute series of examinations, were also charged to think of new and innovative ways that will take insurance industry to the nest level.

Yeside Oyetayo, rector, College of Insurance and Financial Management who presented the 2019 Induction Lecture told the new professionals to take their focus away from the mainstream corporate clients, concentrate on the un-served, bottom segment of the market and create a niche for themselves.

You must think outside the box, be customer-centric, seek new ways to add value to Nigerians through insurance, and then you would have become a truly disruptive innovative

professional, Oyetayo said.

Eddie Efekoha, president of CIIN said it is extremely important to point out that by attaining our professional qualifications, you have become custodians of the ethics and codes of practice of our noble profession.

“The purpose of the Institute’s code of ethics is to set forth the values, principles and standards that will guide the conduct of all insurance practitioners. The mantra of the Institute remains focused around repositioning and reinforcing the integrity of our profession.”

He stated that “as lifetime ambassadors of the Insurance practice, I urge you to uphold this creed and replicate all that it represents in your endeavors. Who you are and the principles you uphold are some of the things that make you stand out as a leader and a truly successful professional.”

Efekoha also pointed out that the completion of the Institute’s examination and your induction as an Associate of the Institute is actually the beginning of your quest for knowledge.

He said “To be successful, you have to use each day as www.businessday.ng

an opportunity to improve, to be better, and to get a little bit closer to your goals. It might sound like a lot of work, but the best part is, the more you accomplish, the more you’ll want to do more and the higher you’ll want to reach. As long as you have the hunger for success, you will always have the power within you to achieve it. I urge you not to relent in developing yourselves in order to stay relevant in the dynamic business world of today and in the future. Ensure that take advantage of the Mandatory Continuous Professional Development (M.C.P.D) programmes offered by the Institute in addition to other postqualification training courses.”

Finally, he reminded them that all certificates issued by the Institute remain the Institute’s property and could be withdrawn from the holders if the Institute has good reasons to do so. “Please note that a further reason for such withdrawal of certificates could emanate from acts unexpected of a holder of the Institute’s professional qualification and unethical behavior. This policy remains in force. It is my hope that there will not be an occasion where the institute is required to do so.”

The paper, titled ‘How Technology Can Help Bridge the Protection Gap,’ ex-

plores innovations and advancements in data collection, data analytics, new services and products and

digitisation, and considers these while analysing the legal, regulatory, and public policy challenges ahead.

Ekhosuehi Iyahen, secretary general of the IDF, said: “As the protection gap continues to grow and climate change intensifies, this poses a significant threat to livelihoods and global prosperity. It is imperative to find effective ways to protect populations, public assets and economies against natural catastrophes. Pioneering new technologies can enable better and faster ways to better understand, manage and transfer risk and thereby increase countries’ resilience, yet this technological change is advancing at an exponential rate and laws, regulation, policy and regulatory architecture are struggling to keep pace.

“We have issued this paper to encourage swift action to enable the use of new technologies to address this challenge and increase resilience.”

Sigma Pension emphasizes importance of good health in retirement Modestus Anaesoronye

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ension Fund Administrator, Sigma Pensions has reemphasised the importance of good health in retirement, and its commitment towards ensuring that customers and staff live healthy life style.

Dave Uduanu, managing director/CE of Sigma said it remained committed to improving the lifestyle and healthcare of clients and staff and the public in general through creation of awareness.

He said regular exercise was crucial in maintaining a healthy lifestyle, including dieting and leading a stress free life.

Speaking in Abuja at the third edition of the Sigma Walk-to-Live Programme said the PFA was committed to helping people to become conscious of the event thereby improving their health.

Represented at the event

by Afolabi Afolayan, execu-

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tive director, Operations, Sigma Pensions, Uduanu said the Company’s intervention would lead to a winwin situation for the PFA and its clients.

He said:”Well, yes, at the end of the day, if we have a healthy population and a healthy client, they will generally take a good work life which means they will be able to contribute even more to their retirement.

“And definitely when they contribute better, they’ll have better balance in their portfolio and so it’s a win win situation.”

Evaluating the programme reception by the public, he said:”The turnout has been good and the responses from the clients have been very positive. They loved it because it brings together Sigma as a family of both clients and staff and so this is a bonding session which has allowed us to know our clients even better and to be able to service them better.

“Our health is important and we keep our clients dur@Businessdayng

ing and after service.

He added: Sigma Pensions is a 15-year old PFA and one of the most customer centric PFAs. This is our third edition of Walk-toLive and this is the second in Abuja and the whole essence is to encourage healthcare and healthy living.”

“Clearly, as the medical authorities have said, for you to maintain a healthy lifestyle, you have to look at exercising regularly, you have to look at your diet and live a stress free life.”

According to one of the medical authorities engaged to educate participants, emphasis is currently on preventive medicine rather than curative medicine.

Participants were further encouraged to embrace dieting, exercise for at least 30 minutes daily, live a stressfree life in order to live a healthy lifestyle.

They noted that a healthy diet must contain low fat, high fibre, vegetables and fruits- as this will increase human lifespan.

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Wednesday 11 December 2019

BUSINESS DAY

Harvard Business Review

MANAGEMENTDIGEST

How AI and Data could personalize higher education LASSE ROUHIAINEN

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rtificial intelligence (AI) is rapidly transforming and improving the ways industries like health care, banking, energy and retail operate. However, there is one industry in particular that offers incredible potential for the application of AI technologies: education. The opportunities — and challenges — that the introduction of artificial intelligence could bring to higher education are significant.

PERSONALIZED LEARNING AS A CORNERSTONE Today’s colleges and universities face a wide range of challenges, including disengaged students, high dropout rates and the ineffectiveness of a traditional “one-size-fits-all” approach to education. But when big data analytics and artificial intelligence are used correctly, personalized learning experiences can be created, which may in turn help resolve some of these challenges.

With a personalized learning experience, every student would enjoy a completely unique educational approach that’s fully tailored to his or her individual abilities and needs.

This could directly increase students’ motivation and reduce the likelihood of their dropping out. It could also offer professors a better understanding of each student’s learning process, which could enable them to teach more effectively.

Here’s what this might look like: AI-based learning systems would give professors useful information about their students’ learning styles, abilities and progress, and provide suggestions for how to customize their teaching methods. For example, some students might be experiencing learning difficulties or challenges that require extra attention or tutoring to keep up.

Others might be advancing so rapidly that they are not being intellectually challenged and would benefit from additional study materials or assignments.

In both of these hypothetical scenarios, AI learning systems would help students to reach their full potential.

For this type of AI-based learning system to work properly, big data would be needed in order to train it. As discussed later in this article, that data would need to be used ethically, and students would need to be informed about how their personal data might be shared

and used by AI algorithms.

PERSONAL DATA WILL BE A KEY INGREDIENT In theory, the application of AI and personalized learning sounds like an ideal solution to some of the most common educational issues. However, the technology still has a long way for to go before it can fully meet its potential.

The primary ingredient of personalized learning is a large amount of student data. My own personal experience in lecturing at universities around the world has shown me that today’s students are more protective of their data than previous generations, most likely due to the security breaches and data scandals they’ve already been exposed to. However, if student data could be collected and processed in a way that was ethical, secure, and transparent, it would allow AI to be used to effectively improve just about every area of study.

One promising initiative in this direction comes from MyData.org, an international nonprofit whose mission is to promote human-centered control and privacy of personal data.

MyData.org, which has become a global movement, aims to give users more control over which personal data they choose to share with AI systems.

CHATBOTS CAN PROVIDE PERSONALIZED HELP AND GUIDANCE Recently, The University of www.businessday.ng

Murcia in Spain began testing an AI-enabled chatbot to answer students’ questions about the campus and areas of study.

As this chatbot was rolled out, the school’s administrators were surprised to discover that it was able to answer more than 38,708 questions, and answered correctly more than 91% of the time. Not only was this chatbot able to provide immediate answers to students outside of regular office hours, but university officials also found that the chatbot increased student motivation. All of these benefits were achieved without the need to change the structure of the staff.

One additional benefit of having chatbots at universities to answer students’ questions is the large volume of big data that would be obtained regarding students’ concerns and areas of interest. This data could be analyzed to help enable universities to create innovative new services and programs.

To reduce students’ stress and improve their motivation to study, universities should also consider introducing chatbots and virtual assistants that can help them manage their mental well-being. One example of such a tool is Woebot, an AI-enabled chatbot designed to help users learn about their emotions with “intelligent mood tracking.” At a time when many university health systems are stretched to capacity, and students experience dangerously long wait times for on-campus

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mental health counseling, chatbots could provide some immediate relief. Universities would need to exercise extreme caution in protecting students’ personal data and would need some level of human oversight to monitor the advice that chatbots are giving students.

IMPORTANT CHALLENGES As universities begin to apply AI to various operations, they will likely find that there are still a number of challenges to be resolved. Perhaps the most crucial point to address is the way to best prepare students for the new technology-based world and the many disruptive technologies that will change the way people work.

It is essential that students understand that over time, more repetitive and routine tasks will be automated and performed by artificial intelligence, automation and robots.

However, there will always be roles requiring creative skills, cognitive skills, and emotional intelligence skills.

As artificial intelligence is applied to education, the best results will come from combining the strengths of AI and human abilities. There will never be a time when humans aren’t necessary for the tasks related to education. For example, teachers will always play a crucial role in our society, as we must never underestimate the value of human interaction and critical thinking in the field of education. @Businessdayng

Even though algorithms can be helpful in guiding decisions, not all educational activities should be run by robots and algorithms. The assistance provided by AI algorithms should instead be leveraged to support the creation of optimal learning environments.

A final major challenge in the implementation of AI technologies is the oversight of data usage. There are difficult and important decisions that will need to be made on every level of society about data ownership, as well as the best ways to use data transparently and ethically.

Although AI offers many exciting developments, especially for improving education around the world, we are still in the early stages of its use.

More experimentation and research is necessary for AI tools to be successfully implemented throughout higher education institutions.

Also, students should learn about how algorithms use data to make decisions, and their input into the design and development of AI systems should be invited and encouraged. Above all, students should remain informed about the ways in which their data is being used.

Lasse Rouhiainen is the author of “Artificial Intelligence: 101 Things You Must Know Today About Our Future” and an international expert on artificial intelligence, disruptive technologies and digital marketing.

Wednesday 11 December 2019

Harvard Business Review

BUSINESS DAY

29

MANAGEMENTDIGEST

Why are we here?

MARK PURDY, JOHN ZEALLEY

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ver the past decade, “purpose” has become a management watchword. And no wonder: Many people want to work for organizations whose missions and business philosophies resonate with them intellectually and emotionally.

Yet many enterprises struggle to define, much less live, their purpose. Read a typical purpose statement and you may find generic goals such as “being the company of choice” and “maximizing shareholder value.” Statements like those don’t speak to what the firm actually does or who its customers are. They fail to answer the vital questions: What is your reason for existing? What value are you giving your customers? Why is your firm uniquely capable of providing it?

A powerful purpose statement achieves two objectives: clearly articulating strategic goals and motivating your workforce. These objectives are important individually and synergistically. When your employees understand and embrace your organization’s purpose, they’re inspired to do work that not only is good but also delivers on your stated aims.

Indeed, it’s hard to imagine how your employees can perform if they don’t know what your organization is trying to accomplish and how their jobs support those goals. In a recent survey conducted by PwC, only 28% of respondents reported feeling fully connected to their company’s purpose. More than half weren’t even “somewhat” motivated, passionate or excited about their jobs.

All this adds up to a crisis of purpose: Workers feel lost. And over time, a lack of direction saps motivation; people begin backing away from the challenges required to achieve the firm’s articulated goals.

The good news is that purpose holds great potential to inspire. In the survey just cited, employees considered it to be more than twice as important, on average, as traditional motivators such as compensation and career advancement. To ensure that your firm’s purpose can create strategic clarity and motivate employees, you must ask this fundamental question: Does it speak to your unique value? From there, you’ll need to ensure that your structure,

systems and resourcing equip your employees to bring it to life.

In what follows, we explore the elements of a well-articulated purpose and the actions needed to deliver on it.

YOUR PURPOSE IS YOUR PROMISE TO CUSTOMERS In an ideal world, every organization would create, communicate and live a purpose firmly grounded in its customers. Businesses are born and survive past startup because they uniquely meet some set of customer needs. They succeed and grow when their purpose remains fresh and when they connect it to their employees’ work.

In evaluating whether your firm has effectively articulated its reason for being, you will want to consider the following questions: — Is our stated purpose relevant to a set of customers or users with the potential to buy our products or services? Is it clear whose lives or businesses we are improving?

— Is our purpose unique?

What hole would be left in the marketplace if we disappeared?

— Are we the rightful owner of our purpose? Do we have or can we build the capabilities to excel at it? Can we fulfill it more effectively and efficiently than our competitors?

Let’s examine how IKEA has addressed those questions in its purpose statement.

IKEA promises “to create a better everyday life for the many people” by “offering a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able www.businessday.ng

to afford them.” The company makes good on that promise by developing keen insights into the ways customers live, translating those insights into products, designing attractive furniture that ships and sells in flat boxes, and using a highly efficient, scalable manufacturing and supply chain.

IKEA’s purpose has long been evident: Founder Ingvar Kamprad got into the home-furnishings business expressly to serve people of limited means.

He stayed true to that aim even when early competitors, upset about IKEA’s low prices, organized a suppliers’ boycott of the company. Rather than charge his customers more, Kamprad added the necessary capabilities, bringing design in-house and turning to new sources for manufacturing.

BUILDING AN ORGANIZATION THAT DELIVERS ON YOUR PURPOSE Clearly articulating your purpose is only the beginning, of course. A great purpose statement is of limited use if your organization cannot execute on it.

To ensure execution of your purpose, you must: — BE A MAGNET FOR THE RIGHT TALENT: You will need the right people, in the right roles, to achieve your organizational goals and competitive distinctiveness. Current models of talent development often aspire to build greatness everywhere.

Frankly, that’s unrealistic. Companies need to make choices in the war for talent. No organization can afford to hire top people across the board.

What are the few capabili-

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ties at which your organization must excel to fulfill its purpose?

Those will involve highly specific skills and should drive decisions about which jobs require top talent. Don’t fall into the trap of hoping that functional generalists will bring expertise in the areas that are critical for your purpose.

— CONNECT WITH INTENTION ACROSS BOUNDARIES: Once you have the right people with the right skills, you should configure your organization to allow them to accomplish everything your purpose demands.

Nearly every important initiative, whether it’s revenue growth or product innovation, requires insights and actions from across the organization. So you need to break down your silos, be they functional, geographic or customer-based.

The most popular “human technology” for gathering an organization’s best thinking and expertise on a complex topic is the cross-functional team. But too often such teams get inadequate time and involvement from their members or fail to receive the resources and attention needed to excel.

To avoid those pitfalls, you can go in one of two ways. You can improve the mechanisms that help cross-functional teams work effectively. That means freeing members from some duties in their “home” departments and assigning a team’s work product to a senior executive whose performance metrics are designed to ensure its success.

Or you can change your organizational structure, assembling @Businessdayng

people with diverse functional skills into permanent crossfunctional units. For example, innovation teams often include individuals from research, engineering, marketing and finance.

— INVEST BEHIND YOUR PURPOSE: Nothing is more demotivating for employees than working on something that has been identified as critical but is not receiving adequate time, attention or funding. In areas that matter most to your purpose, your goal should not be to achieve functional excellence, but to invest more than your competitors so that you can deliver the value you promise.

— MAKE SURE YOUR LEADERS MODEL YOUR PURPOSE: Strong leaders personify their organization’s purpose every day through their words and actions, whether that involves communicating priorities to the workforce or visibly spending time with employees and customers.

Purpose is the key to motivation — and motivated employees are the key to realizing your purpose. Get this symbiotic relationship right, and your organization will thrive.

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Wednesday 11 December 2019

BUSINESS DAY

TRANSPORTATION Motoring

RailBusiness

ModernTravel

Roads

Much more sportier Sonata brakes cover ….With N12.4m starting price tag

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MIKE OCHONMA Transport Editor

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ar freaks in Nigeria are in good for a new driving experience following the introduction of the nextgeneration Sonata by Hyundai Motors Nigeria in their Lagos showroom, showcasing a sporty four-door-coupe look.

The new Sonata is a fully transformed vehicle following the release of the previous generation Sonata in 2014. The 8th-generation Sonata embodies Hyundai’s Sensuous Sportiness design concept celebrates innovative coupe-like silhouette.

A short overhang, sloping roofline and low deck lid create a balanced feel, and Hyundai’s signature chrome accent now goes all the way into the hood, making it look even longer. It also has LED lighting built in. These cues bring the Sensuous Sportiness design to life.

The new Sonata has a much sportier look than its predecessor, with a 30 mm lower height and a width extended by 25 mm.

Its wheelbase is enlarged by 35 mm, and its whole length by 45 mm. The new Sonata’s frontal section is defined by two elements: a bold, voluminous shape evoking a smooth sphere and a cleanly demarcated hood.

Fur ther more, the Digital Pulse Cascading Grille, which resembles the grille of a sports car with its rhythmic visuals, is sleekly connected to the hood, strengthening the overall perception of the front.

Lighting Lamps which is the first for a Hyundai vehicle are a chief design innovation that incorporates state-of-the-art lighting technology, forming the Sonata’s light architecture.

The hidden lighting lamps appear to be of a chromic material

when switched off and become dramatically lit when turned on.

The light architecture was initially revealed through Hyundai’s HDC-2 concept car at the Busan Motor Show in June last year. It was created by fleshing out the form of the lamp and making it into a powerful design element.

Along with the sensuous sportiness concept, the light architecture defines the design identity of future Hyundai cars.

Side sections of the Sonata are accentuated by the light architecture, which connects two chromic lines seamlessly linking the windows and daytime running lights. Through these two characteristic lines, the Sonata effuses an athletic and elegant charm.

It has a wide, layered long hood, a very low stance and a sleek roofline. The feeling of width is also achieved with ultra-wide taillights. The light architecture is also applied to the interior space with the ambient mood lamp illuminating dash-

board and doors.

In the interior, the instrument panel is rich and modern, and the recognizable winged shape is inspired by a Stealth aircraft.

This shape almost levitates or floats when looked at, and this philosophy carries into the long armrests.

Satin chrome accents enhance this effect. Designers compressed the height of the dashboard and HVAC vents as much as possible to aid the lightweight feeling, while modern, light fabric colors and leathers provide a fresh and freeing ambience for the driver.

The clean and sleek design is carried through the center-gauge cluster display. Designers aimed to alleviate the distracting large screens featured in many luxury cars today and instead threaded the two displays together on the 2020 Sonata, using a unique S curve.

These displays are seamless, with no parting lines, and have capacitive touch buttons. Ad-

ditional features include a satin chrome accent on the steering wheel, which looks like an aircraft yoke, and shift-by-wire transmission controls to free up storage space.

Arpita Luthra, group marketing head of Stallion Motors, owners of the franchise in Nigeria says that Hyundai is now the highest selling brand in the country in the new car segment and Stallion’s partnership with Hyundai Motor Company has come a long way since 2014.

The group is committed to providing the best in class service and a fabulous range of world-class vehicles and mobility services to the Nigerian consumer. The vehicles are getting assembled in Nigeria and are topically modified to handle the road severity of the region.

Head of Sales Gaurav Vashisht mentioned that Hyundai Motor continues to enhance its product line-up with vehicles that are helping to build solutions for a more sustainable future.

Shacman, TSS dealership explores new strategies ….At customers’ forum in Benin, Warri, P/Harcourt MIKE OCHONMA

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s part of efforts towards building a strong relationship with its customers, Shacman in partnership with its dealer outlets in Nigeria, Transit Support Services (TSS) gauged the pulse of its fleet operators at a just concluded customers forum in Benin, Warri and Port Harcourt.

The forum is a periodic event intended to bring together management of the brand, customers, stakeholders and members of the public to interact on issues pertaining to the brand and its services. The particular events focused on the owners and operators of Shacman trucks in the South- south region.

For Zhang Fei (Eric), Africa General Manager, Shacman; ‘’ “I would like to give special thanks to our partner TSS and its team for organising this event, also, thanks to our friends Patrick and

Telford. I’m happy to see that more Nigerian customers have adopted our brand and become members of the Shacman family’ “It’s a great honour for me and my team to attend this forum, I’m excited to be here again after 10years since 2009”.

Stanley Mbanu, chief operating officer who represented TSS made a presentation on the Shacman brand, www.businessday.ng

the partnership between the brands, their operations and services they render during which he said that the vehicles have conveyed several million metric tons of goods including dry and wet cargo across Nigeria & West Africa since 2007.

Shacman Nigeria, drawing from local experience in vehicle operation, has designed the applicable heavy duty trucks for the Nigeria condition with popular and tested power trains made up of WEICHAI engine (styre), Fast gear box and Hande axles, the trucks offer the most cost effective operation, delivering a high return on investment to operators.

SHACMAN is a leading truck manufacturer, it has since inception manufactured over 1,000,000 vehicles of different varieties, even as its military truck has successively participated in the 35th, 50th, and 60th anniversary ceremonial military review on China national day.

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NADDC DG, FRSC boss for 2019 Nigeria Auto Awards

Among the corporate fleet owners are the Dangote Refinery, BUA Cement, Dangote Cement , Eterna Plc and offers one year unlimited mileage warranty, original spare parts and maintenance contract Present at the forum are Frank Nneji, chairman, Transit Support Services (TSS), Sui Zhen, the Weichai Nigeria chief representative; Xi Cheng Shacman, the sales manager,; Zhao Xiangnan the service engineer, and Teng Lin, Weichai Nigeria representative. They all took turn to talk about the brand, its mechanism as well as training the customers on the maintenance of the vehicles.

TSS locally assembled at the TSS dedicated assembly line inside ANAMMCO, Emene Industrial lay out, Enugu brings the truck brand to Nigeria through a network of dealers, equipped with comprehensive after services supported by Shacman group. @Businessdayng

ll is now set for the 2019 Edition of the Nigerian Auto Journalists Association (NAJA) Auto Awards slated to hold December 17, 2019 at the prestigious Eko Hotels and Suites, Victoria Island, Lagos.

Expected at the awards ceremony as special guests are Jelani Aliyu, director-general of the National Automotive Design and Development Council (NADDC), Boboye Oyeyemi, Corps Marshal of the Federal Roads Safety Corps (FRSC. It will also provide the opportunity for guests to network. The Lagos State Commissioner for Transportation is expected to honour the event.

Other very important dignatories expected at the event are chief executives and top managers of auto companies, insurance firms, auto dealers and distributors including marketers of automobile related products and services.

According to the award organisers, everything has been put in place to ensure that week’s Tuesday Awards award ceremony turns out to be a successful and remarkable experience. Winners at the different award categories were carefully scrutinized by members of the Nigeria Auto Journalists Association.

With the theme, “EV in Nigeria; What Hope For The Future”, the historic event with has a very important global recognition among automakers and those in the aftermarket

Jelani Aliyu

segment is organised by automotive journalists in the country in recognition of corporate stakeholders across different segments in the industry.

Those to be honoured, according to the organisers include auto-based organisations and other automotive products and ancillary products like tyre brands , lubricants and individuals that are adjudged to have relatively stood out among other competitors in their respective segments in the country’s auto industry within the year.

Nigeria auto awards which is held annually and recognised in every part of the world is adjudged by industry stakeholders as the only respected and most-valued industry event in the country that involves all the motoring journalists in Nigeria drawn from the print, electronic and online media in the voting process.

There are various accord categories while the high point of the awards night is the awards in the Car-Of-The-Year (COTY) award category. Others are awards in the Luxury Car of the Year, Heavy Duty Truck of The Year, Most Innovative CEO Of The Year, Auto, Pick-up of the Year, Showroom of the Year and many others.

New additions to the awards segments this year include the Fastest Growing Auto Brand of the year and Auto Rally of The Year and Online Auto Marketing Platform of The Year.

Wednesday 11 December 2019

BUSINESS DAY

31

TRANSPORTATION Motoring

RailBusiness

ModernTravel

Roads

LASTMA to deploy traffic violation cameras, video by 2020 MIKE OCHONMA

E

ffective first quarter of 2020, traffic management in Lagos state will be completely overhauled to be more efficient and less physically confrontational between the motorists and officials of the Lagos State Traffic Management Authority (LASTMA) in a bid to improve road traffic management problems in Lagos State through the deployment of hand held cameras to be used by its men across the state.

As at the the time of filing this report, the first batch of these cameras which are capable to recording both still pictures and videos real time are on mock trial in selected parts of the metropolis and being used by some LASTMA men in different parts of the state.

It is believed that the technology tagged-Traffic Management Solution (TMS), will improve Lagos traffic control, and enhance the efficiency of LASTMA operations in the metropolis that is densely populated by vehicles.

Adetimiro Olusegun, a LASTMA controller stated that the technology captures traffic violations in real time as they occur, without the threat of harm to the traffic officers and without creating further traffic flow obstructions.

It also executes fast, easy and accurate vehicle road worthiness compliance

Toyota unfolds 3-year new product offensive MIKE OCHONMA

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checks, thus making Vehicles Inspection officers more effective. The solution also processes automated paid parking solutions on designated and newly created spaces along major streets sides.

According to LASTMA, the traffic management solutions will also ensure the “electronic verification of the authenticity of drivers’ licences, vehicle licences and number plates across the entire state’’.

Captured violations by motorists especially private car owners will be reviewed in LASTMAs violation processing centre to verify beyond any reasonable doubt that a traffic violation was committed and that, the correct corresponding value of the legal fine is attached to it. This significantly reduces erroneous violation notifications being sent to vehicle

owners.

As part of violations process, every vehicle owner has a right to challenge a captured violation of their vehicle by clicking the challenge button on the LASTMA website/mobile application.

The court will be provided with a stored video and picture evidence of the captured offence and the vehicle owner will be allowe to explain to the court why the evidence should be disregarded. The court’s ruling and decision on the matter is final.

Violations notification to the vehicle owner caught on camera or video can come through automated text messages, issuance of tickets, client app notifications, free online checks, short codes and at the point of annual vehicle license renewal.

The planned LASTMA new traffic management systems according to sources

brings numerous advantages including but not restricted to the creation of over 5,000 jobs within the first six months, the resolution of the perennial traffic gridlock issues caused by traffic violations within the densely vehicular populated areas of the state.

Apart from serving as a very significant source of revenue for the state, it will eradicate the scourge of payment of bribes to traffic officers, as only electronic payments guarantee the cleareance of a violation from the violators list.

It will also serve the purpose of electronic verification of the authenticity of driver’s and vehicle licences and number plates across the state. This will significantly assist the state government in achieving its goal of clamping down on motorists with fake licenses and number plates and other violations.

he next 36 months will be a torrent of Toyota news. At first glance, Toyota’s product lineup appears complete.

There are gaps, and some products, like the Sequoia, could do with more than an aesthetic refresh.

Toyota seems to realize it could be even stronger as a brand, and, according to a report, it is ready to pursue an aggressive product offensive.

Bob Carter, executive vice president of sales at Toyota Motor North America, was quoted as saying At Toyota’s annual holiday party in Detroit, Roadshow that the market can expect 31 new announcements from us over the next 36 months. At almost one per month for three years, that’s a heavy pace for any

company.

Of course, they won’t all be new cars or meaningful refreshes, with extra trim levels on existing vehicles making up a portion of the upcoming announcements.

It is also likely to include some of the things already known about, including all-wheel-drive versions of the Avalon and Camry sedans and a redesign of the Toyota Highlander.

However, that still leaves plenty on the table.

Admitting that Toyota is understandably cautious about its future plans, he said, ‘’What you can expect from us is ten new products, either refreshed products, derivative products or products that are currently not in either of the brands’ lineups to be introduced over the next year’’.

NRC, CCECC outline challenges on Lagos-Ibadan rail project MIKE OCHONMA

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hinese Civil Engineering & Construction Corporation (CCECC) has listed problems of land acquisition, utility relocation and funding for extra works as current challenges confronting the ongoing Lagos-Ibadan standard gauge rail project.

This was one of the issues presented to the joint committee of the Senate and House of Represenatives members who came project tour of the LagosIbadan rail project as part of their oversight functions. The project tour took the National Assembly members by from Iju in Lagos to Abeokuta to see the extent of job carried out on the first segment of the Lagos-Kano multi-

billion dollar rail project.

Already, there are reports of equipment theft along the Lagos corridor as some criminal elements are currently destroying and stealing clips, bolts and knots. According to Fidet Okhiria, managing director of Nigeria Railway Corporation, about 10,000 bolts, 5000 clips and knots have been replaced.

It would be recalled www.businessday.ng

that when the minister of transport, Rotimi Amaechi declared free train ride along Lagos-Ibadan gauge rail corridor last two weeks, he expressed dismay over the increasing theft of equipment meant for the execution of the remaining standard gauge rail segment from Iju, Lagos with extension into the Apapa port complex.

When the joint com-

mittee of the National Assembly visited, Abdulfatai Buhari, chairman,Senate Committee on land transport who led the delegation on inspection from Lagos to Abeokuta, Ogun state capital said that the present administration has taken the transport sector as the major cardinal project and the committee was very happy with extent of job done so far.

He said that the legislature about two weeks ago appropriated more funds to further reinforce work and they have changed appropriation bill from Januar y to December, adding that so far, the funds appropriated to the project have been utilised when matched with what is on ground.

Buhari noted that the ongoing Lagos-Ibadan

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project, Itakpe-Warri rail and the completed Abuja-Kaduna projects had added values to transportation system in Nigeria and believed more of the projects would add to economic development of the country upon completion.

According to him, ‘’Our intention was to carry out the inspection to Ibadan but we couldn’t, but the beauty of it all is that the train has been taking people freely from Lagos to Ibadan. This idea of free train ride is to ameliorate the sufferings of the people especially during this festive period where our people will be going home for Xmas or new year festivities’’.

The senator expressed optimism that Nigerians would be looking at April 2020 for official commission of Lagos-Ibadan stan@Businessdayng

dard gauge rail line and as soon as possible, the Ibadan-Kano axis will begin. The project that was initially pegged for three years had been achieved within two years; this is a reflection of good governance and better administration.

Rail system will serve as alternative to road transport and it will expand life span of the Nigerian roads, rail system is key in some developed countries like Singapore, America and people are not bothered about buying cars because it’s faster, cheaper, timing and affordable.

This project was extended from Ebute Metta to Apapa m seaport and by this time next year, we would be starting Eastern zone from Port-Harcourt to Maiduguri corridor”.

He said.

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Wednesday 11 December 2019

BUSINESS DAY

FEATURE

How Seplat redefines CSR through Safe Motherhood Initiative Anthonia Obokoh examines the role that a maternal health CSR initiative is having on local communities and the steps that should be taken to further milk its benefits.

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n the morning of September 20, 2019, a woman went into labour at the venue of Seplat’s Safe Motherhood (Eastern Assets) event at Izombe in Imo State. A joyous eruption followed among the women present. Immediately, the mother-to-be was assisted into a waiting ambulance, provided by Seplat, which took her to a nearby hospital.

Before the event was over, news filtered through that a healthy baby girl had been born to the expectant mother. Another baby, this time a boy, was also delivered by another mother, who was also part of the programme, before that particular Safe Motherhood campaign was concluded.

For the past seven years, Seplat has taken it as a core deliverable to lift thousands of expectant mothers living in its host communities with the Strategic Corporate Social Responsibility (CSR) intervention referred to as the Safe Motherhood Initiative. This year alone, two editions have been held. Prominent among these were the one held at Izombe, Imo State and another held recently at Sapele, the heart of Urhobo land in Delta State.

“People are at the centre of everything we do,” Austin Avuru, Seplat’s chief executive officer, is reputed to have once said at a Safe Motherhood event. “The NNPC/SEPLAT joint venture takes delight whenever we have opportunity to deploy these two key programmes specially designed for the wellbeing of our community members and for other indigenes of the state who wish to access the benefits of these health programmes.”

The other CSR programme which he referenced is the Eye Can See Initiative which is also part of the company’s strategy to improve access and quality of healthcare available to its hosts.

Rethinking CSR Indeed, over the years, there have been many initiatives which were undertaken by local and international oil corporations without broad strategies or overarching targets. Seplat’s Safe Motherhood Initiative is anchored firmly on the third sustainable development goal which aims to “ensure healthy lives and promote wellbeing for all at all ages”.

Particularly, the initiative targets mothers or would-be moth-

and Gas, who represented the state commissioner for oil and gas, commended Seplat for the CSR programmes which have positively impacted the lives of members of the host communities. He urged the company to sustain the initiative.

“This is very commendable and I would like to say a big thank you to Seplat for coming up with such an initiative to support the Delta state government and its people,” he said, urging other companies to emulate such gesture.

Recipients of the initiative were also elated. “Na one company carry this responsibility for head? We thank them ooo,” an elated pregnant woman who is in her early 20s said in Pidgin English in Sapele. Although she may not be aware of the number and the reach of the Safe Motherhood, what is clear to her is that investment in form of coordination, purchase of equipment and direct intervention in the lives of those who have pressing needs are being addressed by the initiative.

Participants at the Seplat Safe Motherhood programme

ers who do not have the finance or educational backgrounds to cope with all the challenges of child bearing and nurturing. Globally, the number of children dying under age five is extremely high.

According to UNICEF, the figure stood at 5.6 million in 2016 alone.

Newborns account for a growing number of these deaths, and poorer children are at the greatest risk of under-5-mortality due to a number of factors, based on data provided by UNICEF. It has been determined that if the current trends continue, more than 60 countries will miss the Sustainable Development Goal neonatal mortality target for 2030. About half of these countries would not reach the target even by 2050. Therefore, Seplat’s Safe Motherhood Initiative aims to help governments at the state and federal levels close the gaps which have been observed over the years.

Speaking at the Safe Motherhood event held in Sapele recently, Chioma Nwachuku, general manager, External Affairs and Communications, represented by Emmanuel Otokhine, Base Manager, Western Assets, www.businessday.ng

SEPLAT, stated that the initiative formed part of Seplat’s agenda to positively impact the lives of the people of the operational areas across Nigeria.

“The programme has been impactful in the reduction of maternal and child mortality in our communities through the upgrade and renovation of a 30-bed female and pediatric ward at the Central Hospital in Sapele, the provision of safe delivery kits, insecticide treated nets and distribution of supplements and vitamins. The Safe Motherhood programme helps Nigeria meet up with SDG 3 which promotes good health and well-being,” she said.

This is because, at Safe Motherhood outreaches, mothers and pregnant women are educated on proper nutrition, personal and child hygiene, child spacing among other important tips to guide them through the critical period of pregnancy.

Accurate shot at the grassroots Over the last five years, the programme has achieved the following: screened 24,499 pregnant women, vaccinated 1,500 children, renovated and equipped

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a 30-bed female and children’s ward in a hospital, revitalized 3 health centres in various communities and driven traffic to them, integrated the Traditional Birth Attendants (TBAs) to modern safe delivery methods in Seplat’s Western Asset communities and making inroads in the Eastern Asset.

The strategy adopted to identify those who need this service is quite straight forward. The programme is implemented in SEPLAT communities in the Niger Delta and environs that have very limited or no access to quality health care. These communities have high rates of teenage pregnancies because of inherent socio-economic factors. Over the years, the programme has been impactful in the reduction of maternal and child mortality in Seplat’s host communities.

It is interesting to note that the custodians of these host communities are present during the outreaches. For instance, the event which was held in Sapele was attended by traditional ruler, representatives of local and state governments. Ikoro Efe, assistant director (Geology), gas department, Delta State Ministry of Oil @Businessdayng

Sustaining the sustainability initiative For the Safe Motherhood Programme, there is a tripartite commitment to the programme: From the government, the communities and from its convener, Seplat.

But these initiatives would be strengthened not only from the Seplat end, but also from key players in the communities and government. Essentially, the role of communities and government is to ensure that an auspicious environment is provided when these medial outreaches are in progress. Also, it is important to point out that key leaders in host communities maintain an atmosphere of peaceful coexistence always so that companies like Seplat that conduct business in these environments can do so profitably.

On the part of the mothers, who are the direct beneficiaries, what is important is to imbibe the ethos which is passed on in these highly engaging events. For the mothers who gave birth to babies on those Safe Motherhood event days at Izombe, and many others, these lessons apply. On that day at Izombe, someone subtly remarked that the boy and girl who were born that day should be called Austin, in appreciation of Avuru and Seplat.

Wednesday 11 December 2019

BUSINESS DAY

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Wednesday 11 December 2019

BUSINESS DAY

BANKING Banks’ commercial paper rises to N40.56bn in October

The guidelines stated that the tenor of the BA, including rollover, shall not exceed: in the case of financing purchases, 365 days after execution of documents and acceptance by the bank.

In the case of financing sales, the shortest remaining credit period extended by the drawer (seller) to the purchaser(s) of the goods.

In the case of importation of capital goods, 365 days and a final rollover of additional 180 days, subject to CBN approval.

The CP is to be issued

for maturities of between 15 days and 270 days, including rollover, from the date of issue.

According to the guideline, Issuers and investors in BAs and CPs may do so in dematerialized or physical form. Issuers and investors are encouraged to issue and hold BAs and CPs in a dematerialized form.

The CBN said the underwriting of any issue shall be decided by the issuer. In the event that the issuer decides that no underwriting or only partial underwriting is required, the issuer shall state the minimum level of subscription necessary to achieve its funding objectives.

Unless otherwise allowed, where any issue is under-subscribed and cannot meet the minimum level of subscription as required, the issue shall be aborted, and any consideration received for the purposes of subscription, where applicable, shall be immediately returned to all subscribers.

In the event that an underwriting met the minimum level of subscription but failed to attain full subscription, the shortfall shall be recognized on the balance sheet as a loan.

is what they do for a living.”

He observed that the government alone cannot change the narrative and there was need for collaboration with the private sector. He commended iCreate Skills Africa Limited for working relentlessly to change the mindset of parents, teachers, students and the average person on the street concerning the value of acquiring vocational skills.

Speaking at the event, minister of state for education, Chukwuemeka Nwajiuba, disclosed that the Federal Government has approved the establishment of new Federal Science and Technical Colleges in 16 states of the federation to reposition the nation’s educational system for selfreliance.

The minister noted that technical and vocational education and training hold the key to the development of the country’s industrial sector, adding that the challenges of youth unemployment could best be

addressed through quality education that guarantees self-reliance.

Nwajiuba said entrepreneurship education and training is globally recognised as an important strategy for tackling youth unemployment. Consequently, the Federal Government has trained more than 500 science, vocational and mathematics teachers on the use of modern equipment and new approaches in schools.

On his part, Founder and CEO of iCreate Africa, Bright Jaja, said it has been an amazing journey so far and he is honoured to have stakeholders that are committed to the realisation of a dream which started over a year ago.

He said following the successful outcomes of the skills competition for the second consecutive year, iCreate Africa plans to introduce the iCreate Skills League (ISL) in 2020 in a bid to spread the competition to the 36 states of the federation and the Federal Capital Territory (FCT), Abuja.

Stories by HOPE MOSES-ASHIKE

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ommercial paper (CP) outstanding held by deposit money banks stood at N40.56 billion at the end of the review month, showing an increase of 9.9 per cent, compared with N36.91 billion recorded in the month of September 2019.

A CP is an unconditional promise by a person to pay to the order of another person a certain sum at a future date. Such an instrument may or may not carry the bank’s guarantee. Where the bank guarantees the CP to make it more marketable in the money market, the instrument acquires the force of a Bankers Acceptance (BA) and the bank incurs a contingent liability. Where the CP is not secured or guaranteed by the bank (clean CP), it needs not be reported as a contingent liability.

Thus, CP constituted 0.32 per cent of the total value of money market assets outstanding in the review period, compared with 0.30 per cent in the preceding month, a report

by the Central Bank of Nigeria (CBN) indicated.

At the end of October 2019, BAs stood at N1.59 billion, representing an increase of 9.7 per cent, relative to the level at the end of the preceding month.

A BA is a draft drawn on and accepted by a bank, unconditionally ordering payment of a certain sum of money at a specified time in the future to the order of a designated party.

Since the instrument is negotiable, title to it is transferred by endorsement. It is a marketable instrument

and allows a bank to finance its customers without necessarily utilising its loanable funds.

Instead, funds are provided by investors who are willing to purchase these obligations on a discounted basis.

Consequently, BAs accounted for 0.01 per cent of the total value of money market assets outstanding at the end of the review period, same as the level at the end of the preceding month.

The CBN had in September pegged the aggregate

off-balance sheet for Bankers Acceptance and Guaranteeed Commercial Papers at 150 percent of shareholders’ funds unimpaired by losses for a bank and 300 percent for the discount Houses (Merchant Banks).

This was contained in the guidelines on the issuance and treatment of BAs and CPs. Consequently, Off-balance sheet BAs and guaranteed CPs extended to a single obligor shall not exceed 30 percent of a bank’s or discount house’s shareholders’ funds unimpaired by losses said the regulator.

How Sterling Bank is empowering technicians

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bout 82 technicians from different parts of the country competed for honours in skill categories that include robotics, plumbing, carpentry, shoemaking, web and graphic design during Africa’s biggest skills festival powered

by Sterling Bank Plc in Lagos.

At the end of the two-day competition organized by iCreate Africa Limited, 14 highly skilled technicians were crowned national champions for exceptional performance in their categories. Two additional outstanding technicians were also rewarded with cash prizes as well as silver and bronze medals respectively.

Breakdown of the 42 winners revealed that 17 technicians competed from the Southwest region, 14 from Northern region and 11 from the South East region.

Categories with the highest scores in the competition were robotics, automobile engineering, plumbing and leather works. Winners in

these categories are Miracle Olasoyin with a 99 percent score in robotics, Leonard Manzo with 98 percent score in automobile engineering, Chima Solomon with 92 percent score in plumbing and Lot Madaki with 90 percent score in leather works.

Overall winners in other categories are Ibraheem Ridwan (Carpentry), Christopher Olaniyi (Tiling), Oluwasegun Akanbi (Electrical), Toheeb Ogunbiyi (web design), Audu Precious Adayi (Graphics), Ifedayo Emmanuel Bello (Cooking), Mojisola Akin-Ademola (Fashion), Akinlo (Art), Emmanuel Abanobi (Make up) and Abdul-Rasheed Kelvin Hassan (Barbing).

First of its kind on the African continent, the festival which promotes technical skills and vocational education had in attendance Abubakar Suleiman, managing director/CEO, Sterling Bank and other captains of industries; top government functionaries that include the Minister of State for Education, Chukwuemeka www.businessday.ng

Nwajiuba; over 50 industry experts and judges, 200 volunteers and over 2500 local and international guests.

In his keynote address at the event, Abubakar Suleiman, Chief Executive Officer, Sterling Bank, disclosed that the bank is prepared to stand by skilled professionals who are out there solving the real problems of the country because their successes could inspire others as well as change the

prevailing mindset about technical and vocational education.

Abubakar called for a change in mindset of stakeholders in the labour market such that people who are engaged in vocational skills could be respected and supported to earn decent living like their counterparts in white collar jobs. “Vocational skills have been reduced to a point where very few people are proud to say it

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Wednesday 11 December 2019

BUSINESS DAY

35

FINANCIAL INCLUSION

& INNOVATION

6 activities shaping future of Nigeria’s financial inclusion deliver financial services especially to the underserved and the financially excluded while players in the Telecommunications industry are expected to obtain the mobile money licence.

Stories by Endurance Okafor

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ith a target to increase the number of Nigerian adults in the financial system from the current 38 million to 100 million in the next five years the Central Bank of Nigeria plans to use both the bank and mobile money-led financial inclusion model.

There are five activities of ecosystem stakeholders, especially financial services regulators and other government agencies, which are likely to shape the outlook of financial inclusion in a country where 36 million people are financially excluded.

Payment Service Banks (PSBs) Before October 2018 when the apex bank released an exposure draft that requested application from Telcos, retailers and other industry players to apply for Payment Service Bank (PSB) aimed at giving financial access to Nigeria’s excluded population, Nigeria only depended on its bank-led model in driving financial inclusion.

Nigeria’s quest to ensure 80 percent of its adult populations are granted financial access by 2020 has largely been driven by its bank-led

Panellists at the 2019 LBS Financial Inclusion Conference which held recently in Lagos

model.

While its Africa peers reported growth in financial inclusion through the use of mobile money, Nigeria has been lagging due to its bank led-inclusion model.

The latest figures by EFInA put Nigeria’s financial inclusion rate at 63.2 percent, meaning as much as 36.8 percent of adults still lack access.

As at the time Nigeria was considering the optimal approach needed to leverage new, innovative technology to deliver financial services to its people, the Central Bank analysed in some detail how to structure the guidelines and the

regulatory environment to deliver the benefits on offer, without compromising the integrity of the financial system.

Africa’s largest economy needed to see how the regulation of mobile money could evolve owning to significant volumes of currency that could be circulating in mobile wallets, and may not be visible to the regulatory authorities.

As such it was clear that a better balance between the market and the regulatory structures was required.

Since then there has been an explosion in mobile money wallet usage in Kenya and other Africa peers,

the Nigeria’s CBN was rather focused on an independent bank led model that would supplement and support the existing banking system Data by the International Monetary Fund (IMF) revealed that there is positive correlation between financial inclusion and mobile penetration.

This suggests that the rollouts of Information and Communications Technology (ICT) could stimulate financial inclusion.

The Central Bank recently granted Approvalin-Principle to three PSBs. The PSBs are expected to leverage their distribution network and technology to

Increasing loan-deposit ratio of deposit money banks to 65% In its bid to improve lending to the real sector of the Nigerian economy; the Central Bank of Nigeria mandated all Deposit Money Banks (DMB) to maintain a Loan to Deposit Ratio (LDR) of 65 percent after the September deadline of 60 percent.

According to industry analysts, the policy by the apex bank is likely to increase access to formal credit with the potential to attract the under-banked and the unbanked into the formal financial system.

CBN’s Cashless policy Nigeria’s apex bank plans to implement the cashless policy in six pilot states and Federal Capital Territory, and there are high hopes from industry sources that it could drive the use of digital channels for financial services and reduce the cost of providing the services by providers in order to financially include the excluded.

Stamp duty The collection of N50 stamp

duty charge on every point of sale (PoS) transaction of N,1000 or more is likely to discourage the use of this digital channel, as compiled from industry analysts. According to the players it could negatively affect the critical mass needed by providers to lower cost of providing financial services and boost financial inclusion.

Continuing the national social investment programmes The conditional cash transfer (CCT), home grown school feeding programme, a job creation and skills empowerment programme (N-Power) and Government Enterprise and Empowerment Programme (GEEP) which started in 2016 have brought over a million financially excluded into the formal financial system.

Financial inclusion is likely to be positively affected as more Nigerians benefit from the programme in the coming years, industry sources have stated.

Introduction of micro insurance guidelines It is believed that the initiative will is most likely to boost financial inclusion as it targets low-income Nigerians that constitute the majority of the underserved and financially excluded.

PalmPay introduces Lucky Money: A rewarding way to send money

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almPay, an Africafocused mobile payment start-up said it has introduced Lucky Money, a new money transfer feature on the PalmPay app that allows its customers to win instant rewards for using the app to send money.

According to the Fintech Company which recently obtained an Approval-In-Pr inciple for a mobile money license from the Central Bank of Nigeria, the Lucky Money feature was introduced to encourage money transfer in Nigeria.

“Instead of getting charged for sending money, you get rewarded. What we are doing at PalmPay is revolutionary, now you can send money with a greeting card attached for special occasions, events or holidays and become lucky by winning instant rewards,” the company said.

On how the users of

the mobile App can access Lucky Money, PalmPay explained that Lucky money can be sent to another PalmPay user or someone who does not have the PalmPay app.

“When you send Lucky Money, the receiver has to accept your Lucky Money within 48 hours for you to get a chance to play the lucky game to win rewards, if the receiver does not accept Lucky Money after 48 hours of receipt, the sent amount would be returned to the sender.

You can also create a Lucky Money link which will allow your friends to claim the money. The link expires after 48 hours or when all the money has been collected,” Palmpay told BusinessDay by mail.

According to the company which recently raised $40million in a seed round led by device brand TECNO Mobile, the users of the PalmPay app can send

Lucky Money directly to one or more than one persons in their phone book.

Also, the users can create a Lucky Money link which will allow their friends to claim the money.

“The Lucky Money link can be shared across social media platforms and the sender gets to play the lucky game with ever yone who claims the Lucky Money,” it said.

On how the users can play the Lucky game, PamPay explained that when a user sends Lucky Money and the receiver accepts, such a person will get to play the lucky game. “You can send Lucky Money 3 times per day and there is no limit to how many times you can play the game.”

On what can be won as a prize from the game, the Fintech Company explained that : “There are PalmPoints and raffle tickets to be won in the lucky game. The raffle ticket

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qualifies you to participate in the raffle to win a brand new Hyundai xcent car on 15th December and other exciting prizes like mobile phones, generator sets, refrigerator sets, washing machines and more.”

PalmPay offers consumers a range of digital services via its mobile application, including transfers, payment of electricity bill, internet sub renewal, DSTV subscriptions, and airtime purchases.

Billing itself as “the payment app that rewards you”, its unique selling proposition of offering cashback and discounts to its users has caught on in the pricesensitive Nigerian and Ghanaian markets.

In Nigeria, PalmPay is offering 10percent cashback on airtime purchases and bank transfer rates of N10 with free deposits and withdrawals to its mobile wallet. Over a million transactions have been made

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on the platform within its first two months of pilot operations and the company is now eyeing rapid expansion.

With the recent launch of its App in Nigeria, PalmPay plans to bring Nigeria’s financially excluded population into a financial world that will make their lives easier, better and more connected.

The company plans to give access to both the banked and unbanked population in Nigeria where about 36 million people don’t have access to financial services.

Through the wallet on its mobile App, a Nigerian without a bank account can be granted access to financial services including P2P transfers, airtime and bill payment.

To be able to do this, the company is building an agent network to facilitate in-person cash in and cash out to its mobile wallet. @Businessdayng

PalmPay plans to leverage the network of 100,000 merchants belonging to Visa, which the company counts as strategic partners.

In April 2019, PalmPay announced that it would work together with VISA to roll out innovations in the African digital payments space.

Visa cardholders can initiate payments within the app and make online and mobile payments by attaching their card details to their PalmPay profile.

Non-card carriers will be able to instantly generate a virtual Visa card upon registration.

“Our vision for the app is that PalmPay becomes the one-stop-shop for your digital and financial world and that PalmPay becomes the place to go that has the best choice and offers in the market,” said Greg Reeve, PalmPay Global CEO.

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Wednesday 11 December 2019

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Tuesday 10 December 2019

Top Gainers/Losers as at Tuesday 10 December 2019 LOSERS

GAINERS Company

Opening

Closing

Change

EKOCORP

N4

N4.15

0.15

GLAXOSMITH

N5.7

N5.8

0.1

FCMB

N1.77

N1.84

0.07

ZENITHBANK

N18.5

N18.55

0.05

Company

Opening

Closing

Change

NESTLE

N1350

N1300

-50

ASI (Points) DEALS (Numbers)

MTNN

N118

N116

-2

DANGCEM

N142

N140

-2

ARBICO

N4.32

N3.89

-0.43

VALUE (N billion)

N7

N6.6

-0.4

MARKET CAP (N Trn)

UBN

VOLUME (Numbers)

26,384.21 3,153.00 196,291,978.00 3.551 12.734

Investors book another N143bn loss as sell pressure continues …market creates opportunity for position taking in value stocks Stories by Iheanyi Nwachukwu

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he Nigerian stock market furthered into the bearish region on Tuesday December 10 causing the already record negative return this year to reach -16.06percent.

This negatives continued on the Bourse as more investors put their shares for sale preparatory to yuletide

spending.

Investors lost N143billion as evidenced in the value of listed stocks which decreased from preceding day high of N12.877trillion to N12.734trillion.

As sell pressure continues to dominate the equities market pushing the NSE ASI deeper in the red zone, market watchers foresee similar trend on Wednesday in the absence of any positive market catalyst.

The Nigerian Stock Ex-

change (NSE) All Share Index (ASI) which opened the review day’s trading at 26,681.31 points decreased to 26,384.21 points. In 3,153 deals investors exchanged 196,291,978 units valued at N3.551billion.

GTBank, Access Bank, Transcorp, Zenith Bank and Wema Bank were actively traded stocks. Nestle recorded the highest dip after its share price moved from N1350 to N1300, losing N50 or 3.70percent, followed by

MTN N which decreased from N118 to N116, down

by N2 or 1.69percent and Dangote Cement Plc which decreased from N142 to N140, losing N2 or 1.41percent.

Gains by Zenith, Access, FCMB, and GSK failed stop the record loss. Analysts believe the consistent declines on the Bourse create opportunity for position taking in value counters with records of dividend payments and capital appreciation.

L-R: Ibrahim Mohammed Panti, representative of Governor of Niger State and Commissioner for Works and Infrastructural Development; Goddy Jedy-Agba, minister of State for Power; Damilola Ogunbiyi, managing director/CEO Rural Electrification Agency; Adamu Muhammed Rokota, village head, Rokota Community and Shubham Chaudhuri, country director, Nigeria World Bank, during commissioning of the First (lST) Mini Grid under the Performance Based Grant of REA/World Bank at Rokota Community in Edati Local Government Area of Niger State.

NSE lifts suspension on trading in shares of FTN Cocoa Processors

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he Nigerian Stock Exchange (NSE) has notified the investing public the lifting of suspension placed on trading in the shares of FTN Cocoa Processors Plc. The NSE had in its market bulletin dated July 2, 2019 notified Dealing Members of the suspension of eleven (11) listed companies for non-

compliance with Rule 3.1, Rules for Filing of Accounts and Treatment of Default Filing, Rulebook of The Exchange (Issuers’ Rules).

The Rules provide that: “If an Issuer fails to file the relevant accounts by the expiration of the Cure Period, The Exchange will: (a) send to the Issuer a “Second Filing Deficiency Notification” within two (2) www.businessday.ng

business days after the end of the Cure Period; (b) suspend trading in the Issuer’s securities; and (c) notify the Securities and Exchange Commission (SEC) and the Market within twenty- four (24) hours of the suspension.”

FTN Cocoa Processors Plc, one of the 11 companies that were suspended on July 2, 2019 has now filed its Audited Fi-

nancial Statements for the year ended December 31, 2018 as well as its first, second and third quarter financial statements for 2019, the NSE said.

In view of the Company’s submission of their audited financial statements, and pursuant to Rule 3.3 of the Default Filing Rules, The Exchange on Tuesday, December 10, 2019 lifted the suspension.

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Global market indicators FTSE 100 Index 7,218.65GBP -15.25-0.21%

Nikkei 225 23,410.19JPY -20.51-0.09%

Generic 1st ‘DM’ Future 27,921.00USD +19.00+0.07%

Deutsche Boerse AG German Stock Index DAX 13,053.13EUR -52.48-0.40%

S&P 500 Index 3,136.01USD +0.05+0.00%

Shanghai Stock Exchange Composite Index 2,917.32CNY +2.84+0.10%

NSE highlights importance of capital market in …Rewards winners of the 19th NSE essay competition

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he Nigerian Stock Exchange (NSE) has highlighted the critical role of the capital market in delivering sustainable socio-economic growth and development in Nigeria. This was articulated at the award ceremony of the 19th NSE Essay Competition for Senior Secondary Schools in Nigeria which held in Lagos.

Speaking at the event, the Chief Executive Officer of the NSE, Oscar N. Onyema, emphasised the need for innovative s olutions to leverage the capital market for the achievement of the Sustainable Development Goals (SDGs). “We need to connect people with products and services that build human and physical capital, as well as bridge infrastructural gaps in Nigeria.

“We have also identified the critical role of millennials in achieving these outcomes evidenced by the overwhelming interest today’s youth have shown in this exercise. We were not only delighted by the thousands of entries we received this year – up over 100% from last year – but also impressed by the quality of progressive solutions articulated in the submissions, some of which will be presented today,” Mr Onyema added.

At the ceremony, Adeniyi Adesewa of Grandmates Secondary School was announced as the 1st place winner of the NSE Essay Competition out of 40,966 applicants across Nigeria. She has been awarded a N500,000 scholarship fund for her university education; N500,000 worth of equity investment; and a laptop. Grandmates Secondary School has also been awarded 3 desktop computers and a printer.

Temiloluwa Oladipo and Adeoye Okhaioisevai both of Oritamefa Baptist Model School emerged 2nd and 3rd place respectively. Each of them has been presented with a scholarship for university education, equity investment and a laptop, along with desktop computers and a printer for the school. In @Businessdayng

addition, the top 3 winners were given the prestigious honour of a Closing Gong Ceremony at the Exchange, while 7 other finalists received laptops in recognition of their good performance.

Pres ent at the event was the First Lady of Lagos State, Ibijoke SanwoOlu, represented by F u n k e O m o t o s h o. S h e commended the NSE for the contribution of this initiative to the development of our great nation and encouraged participants in the competition to stay committed to developing their skills.

The sp e cial guest of h o n o u r, C h u k a E s e k a , Chief Executive Officer, Vetiva Capital Management Limited and President of the Association of Issuing Houses of Nigeria (AIHN) counselled the students on the need to develop a strong savings and investment culture. He magnanimously awarded N250,000, N150,000 and N100,000 worth of money market investments to the 1st, 2nd and 3rd place winners respectively on behalf of the Association of Issuing Houses of Nigeria (AIHN) and Vetiva Capital.

Modupe Adefeso-Olateju, Managing Director of the E d u c a t i o n Pa r t n e r s h i p Centre in her keynote address advised the students on the need to develop a range of skills to ensure a sustainable future in light of our ever evolving society. She also empha si ze d e ducat i o n, financial responsibility and integrity as important virtues to imbibe.

The NSE Essay Competition is designed to develop a culture of wealth creation among our youth towards “Building a Financially Savvy Generation”. Over the last 19 years, the competition has successfully increased awareness and inspired active participation of the youth in Nigeria’s capital market. This year edition was supported by Zenith Bank Plc, Access Bank Plc, Prime Atlantic Limited and Hewlett Packard Nigeria Limited.

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news AMCON chairman’s sack heightens 2023...

Continued from page 1

Service (FIRS). Banire and

Fowler are loyalists to Bola Ahmed Tinubu, a chieftain of the ruling All Progressives Congress (APC), who is alleged to be interested in succeeding Buhari in 2023, even though Tinubu and Banire were reported to have fallen out in the past.

Political analysts say the president’s refusal to reappoint Fowler and his sack of Banire are all part of attempts to clip Tinubu’s wings ahead of the 2023 elections.

Banire’s replacement was contained in a letter from the president read on the floor of the Senate by Ahmad Lawan, president of the Senate.

“In accordance with Section 10(1) of the Asset Management Corporation of Nigeria (AMCON) Act, 2010, I hereby present Mr. Edward Lametek Adamu for confirmation as chairman of the Asset Management Corporation of Nigeria by the Distinguished Senate,” said the letter dated December 9, 2019.

“While hoping that this request will receive the usual expeditious consideration of the Senate, please accept, Distinguished Senate President, the assurances of my highest consideration,” it said.

Tunji Shelle, a former chairman of the main opposition People’s Democratic Party (PDP) in Lagos, accused the Muhammadu Buhari administration of nepotism and sidelining of other regions in the country in terms of appointments into public offices.

Shelle wondered why President Buhari would remove the two men who hail from the South West and replace them with Northerners, stressing that the president’s action was against the unity of the country.

He, however, refused to rule out insinuations that their removal could be linked to the battle for 2023 presidency, but added that it portrayed the bad politics being played in the country.

“What President Buhari has done is not good for the unity of the country. These are public positions. If they are qualified, why not allow them continue in the positions? It shows the kind of dirty politics we are playing. You don’t play this kind of politics,” Shelle said.

“This government is taking this nepotism too far. How can you remove a Yoruba man and put a Northerner there?

That was what happened when [Kemi] Adeosun was removed; the replacement supposed to be from the South West. We are being cheated and it does not help for the unity of this country,” he said.

However, Moshood Salvador, a chieftain of the ruling APC in Lagos State, denied insinuations that Banire’s removal was politically motivated or linked to the battle for 2023 presidency.

Salvador urged Nigerians to stop insinuations, stressing that the presidency may have removed Banire from his position for a better one.

“I don’t like commenting on these issues because I am not in government and I don’t know what they are doing. But it’s wrong for you to link Muiz [Banire’s] removal from office to 2023,” he said. “Let’s watch and see. With time we would know, but I’m sure his is not linked to 2023.”

Buhari appointed Banire as AMCON chairman in July 2018. Banire, a former national legal adviser of the APC, is one of Tinubu’s loyalists.

He was a special adviser to Tinubu in 1999 during the latter’s tenure as governor of Lagos State. He was subsequently named commissioner of transportation in the same year, a position he held till the expiration of Tinubu’s eightyear tenure in 2007.

During his tenure as commissioner for transportation, Banire created the Lagos State Traffic Management Authority (LASTMA) to combat the state’s growing problem with automotive congestion. He also initiated the Bus Rapid Transit (BRT) to improve capacity and reliability relating to conventional bus systems.

Also, during the time of Babatunde Fashola as Lagos State governor, Banire was appointed as commissioner of environment and made combating Lagos flooding through the implantation of state-wide drainages a priority and Lagos’ role in combating the worldwide problem of climate change was actively pursued.

Before Fowler’s replacement on Monday, the former FIRS boss had requested to be reappointed for a second term in office, according to a letter seen by BusinessDay. “I wish to present myself for reappointment for a second term. This is consistent with the provisions of the FIRS Establishment Act 2007 and would grant me the opportunity to consolidate and build on the achievements we have recorded in the past 4 years,” Fowler had said in the letter he addressed to Boss Mustapha, secretary to the government of the federation (SGF), referring to a notification of his tenure expiration as executive chairman of FIRS. Despite attaching the highlights of his achievements during his first tenure in office, his request was still not granted.

“I would like to put it on record my gratitude to Mr President for the opportunity to serve the nation. I am also thankful for your support in the course of the discharge of my duties,” the letter read.

President Buhari had on Monday named Muhammad M. Nami as the new chairman of the FIRS, replacing Fowler whose tenure expired on Monday. www.businessday.ng

L-R: Femi Omotayo, MD, AOS Orwell; Ngover Ihyembe-Nwankwo, coverage head, RMB Nigeria; Gopinathan Chemmenkotil, executive director/CFO, AOS Orwell, and Michael Larbie, CEO, RMB Nigeria/regional head West Africa, at the RMB Nigeria Client Appreciation Event which included the RMB Nigeria Custody Launch and Art Exhibition, in Lagos.

FG’s failure to pay group life premiums to...

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the insurance industry is denied opportunity for growth and expansion, which will result in noncreation of new jobs to help address rising unemployment in the country.

But most worryingly is that dependants of deceased employees and the men and officers of the Nigeria Police who have died during this period were not adequately compensated.

Besides, their vulnerability and risks profile have increased since they have nothing to fall back on, having lost their breadwinners without insurance compensation.

According to figures from the Nigerian Insurers Association (NIA), group life and annuity had pushed life insurance premium up by about 40 percent in the last five years.

Federal Government’s group life insurance, which is domiciled in the office of the Head of Service of the Federation, was effective last in April 2018 when premium was paid. Since that time, insurance companies that had hitherto provided the group life cover as provided in the Pension Reform Act 2004 as amended in 2014 have not picked up new claims in line with the ‘No Premium No Cover’ law.

Dependants of employees who died between the past year and nine months had nothing to claim from insurance companies, and so the Federal Government has been falling back on its budget for monies meant for other things to pay compensation.

Section 9 (3) of the Pension Reform Act 2004 as amended in 2014 stipulates that every employer,

both in the public and private sector which the Act applies, must maintain life insurance policy in favour of the employee for a minimum of three times the annual total emolument of the employee.

The policy provides cover to the insured against death and the insurance cover is mandatory for all employees as long as they are in employment.

This means that the policy provides for the payment of the sum assured in the event of the death of a member of the scheme from any cause, natural or by accident.

“The business environment was very harsh as insurers suffered the nonpayment of premiums on group life account from the office of the head of service,” said Funmi Omo, managing director/CEO, African Alliance Insurance, while reviewing the operating environment in 2019.

“You know group life insurance contributes significantly to our premium, so it was not a good one for the outgoing year,” she said.

According to Omo, the major impact is that families of deceased employers did not get insurance compensation since there is already a policy on ‘No Premium No Cover’.

Omo, however, noted that insurance companies have had to device other means of expanding their revenue base to cover the shortfall.

Stakeholders say insurers have to mimic the banks and be more innovative if they want their return on equity (ROE) to be strong after recapitalisation.

Femi Ademola, executive director of investment banking, Cordros Capi-

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tal, said operators in the industry should enforce compulsory insurance, and that a lot of hospitals have liability insurance.

“The operators need to change with time. The young generation do not buy cars these days. Some big phones are more expensive than a car, but there are no covers for products like this,” Ademola said.

The average return on equity (ROE) of listed insurers was 3.41 percent in 2005 when the industry was first recapitalised.

Then it fell to 0.43 percent in 2008, and the ratio dipped to a negative region of -1.05 percent from 2009 all through 2012, according to a recent data from the Nigerian Stock Exchange (NSE).

However, ROE rose to a positive region of 1.15 percent in 2013 and 2.55 percent in 2014, but it dipped into a negative region of 0.58 percent in 2015, according to the report.

Return on equity (ROE) is a measure of financial performance calculated by dividing net income by shareholders’ equity. It is considered a measure of how effectively management is using a company’s assets to create profits.

Recent trends have shown that insurers are barely covering their cost of capital, let alone providing returns above or matching the rate of inflation as the tough business landscape continues to pressure firms’ profit.

“It is not surprising that the Nigerian insurance industry lacks profitability,” said Guy Czartoryski, head of research at Coronation Merchant. “We have already seen how, over the past 10 years, the industry has barely grown in real terms. One effect of lack of growth is that companies are unable to create @Businessdayng

economies of scale for their front and back office operations.”

Generally, scale is evaluated by relating the operating cost (claims and operating expenses) of insurers to their output level.

Bode Ojeniyi, executive director at Wapic Insurance plc, said it was worrisome that insurance stocks are least attractive despite volumes traded. He said operators need to invest in the latest technology and that they should launch products that would attract the young generation.

Adeosun Dolapo, associate director, deal advisory and private equity group, KPMG, said the injection of capital would make operators more creative in product launch.

“There has to be collaboration between insurers, banks, and telecommunication companies,” said Dolapo.

Yetunde Ilori, director general, Nigeria Insurers Association (NIA), said the solution to receding profit is cost cutting, and that huge costs are incurred during product launch.

“Our retained earnings and contingent reserve have to be recognised,” said Illori.

When compared to other jurisdiction, the Nigerian insurance industry is relatively small and ranked 162nd in the world with a total premium volume of $1.64 billion, according to recent data by NSE. According to the NSE, the total Nigerian insurance market accounted for 0.20 percent of the global premium in 2018.

“The larger the balance sheet, the more likely we take on more risk. We can reach a wider market and seek returns from Fintech companies,” said Eric Idiahi, co-founder/partner, Verod Capital Management Limited.

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news

DisCos raise revenue collection by N43bn, reduce losses to 45% HARRISON EDEH, Abuja

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lectricity distribution companies (DisCos) have raised revenue collection

by N43 billion in the last one year, while reducing their Aggregate Technical, Commercial and Collection (ATC&C) losses to 45 percent.

AstatementbytheAssociation ofNigerianElectricityDistributors (ANED) on Tuesday said from October 2018 to June 2019, the 10 DisCos raised their energy revenuecollectiontoN466billion.

Theyalsoraisedtheircollectionefficiency(capacitytocollectmoney for energy supplied to customers) by 67 percent.

This was higher than the N423 billion they collected from their customers between October 2017 and September 2018, when the collection efficiency was 65 percent. ANED’s director of Research and Advocacy, Sunday Oduntan, stated, “This is a reflection of DisCos’ commitment

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to reduce losses, even within the context of the financial crisis of the power sector.”

Oduntan noted that the DisCos, while increasing their collections by N43 billion in a year, by a rate that represents over 10 percent of improvement, also raised billing efficiency by 5 percent during the period under review.

An analysis of the Key Performance Indicators (KPI) report the DisCos submitted to the Nigerian Electricity Regulatory Commission (NERC) shows that the DisCos reduced their ATC&C losses by 3.6 percent within one year - ATC&C was49percentin2018andhasbeen reducedto45percent in 2019.

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NERC silence on revocation threat, as fragile power sector yearns for reforms HARRISON EDEH, Abuja

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igerian Electricity Regulatory Commission (NERC) has remained largely silence on the issuance of the threat on licence revocation on some distribution companies, even as the fragile power sector yearns for urgent reforms, BusinessDay learns.

The NERC was expected to on December 7, disclosed its final decision on the status of the licence revocation notice it issued to eight electricity distribution companies (Discos).

However, as at the time of filing this report the revocation has not been done raising concern on the stance of the regulator on key issues such as this.

The Discos, specifically Abuja; Benin; Enugu; Ikeja; Kaduna; Kano; Port Harcourt

and Yola, were alleged by the NERC to have committed various regulatory infractions.

Already, the Discos were in October issued notices of intention to cancel their distribution licences by the NERC, which stated that they breached provisions of the Electric Power Sector Reform Act (EPSRA) 2005, terms and conditions of their respective distribution licences; and the 2016 to 2028 minor review of the Multi-Year Tariff Order (MYTO) and Minimum Remittance Order for 2019.

Also, most industry analysts had expressed worry on the slow pace of the power sector growth post privatisation in 2013, raising further concerns on the thoroughness of the privatisation exercise and its impact on the power sector growth.

Senate president, Ahmed Lawan, had raised similar concerns

Akwa Ibom Assembly passes 2020 appropriation bill ANIEFIOK UDONQUAK, Uyo

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he Akwa Ibom State House of Assembly has passed the 2020 Appropriation Bill. Governor Udom Emmanuel had on October 8, 2019, presented the bill with a total budget outlay of N597.800 billion for the 2020 financial year to the assembly.

It was subsequently referred to the House Committee on Finance and Appropriation for further scrutiny.

Presenting the committee’s report, the chairman, Uduak Odudoh, urged the House to pass the revised 2020 budget of N597.735 billion, made up of N111.250 billion for recurrent expenditure, N369.577 billion for capital expenditure and N116. 934 billion for consolidated revenue fund charges.

The House, after dissolving into the Committee of Supply, considered the recommendations of the Appropriations Committee and subsequently passed the 2020 budget of N597.735

billion after a third reading.

In his remarks, speaker of the House, Aniekan Bassey, said the passage of the budget a month before the next financial year would enable the governor continue with his industrialisation plan and also consolidate on his past achievements.

He assured that the seventh Assembly would continually build a robust and impactful relationship with other arms of government to foster development and growth in the state.

The speaker said with the passage of the Appropriation Bill, the House had practically given consent and expression to the executive arm, to go ahead with the implementation of the 2020 budgetary estimates and provisions.

He thanked the chairman and members of the Appropriations Committee for working assiduously to ensure that the 2020 budgetary estimates got into the front burner of scrutiny of all House committees necessitating its early passage.

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stating that the sector had fallen short of expectations, noting, “If we had to review the privatisation since we are not making meaningful progress why not.”

Sam Amadi, a former chairman of the NERC, told BusinessDay that divestment of the sector was better than the regulatory stance on licence revocation.

“Admittedly, there are areas we have made mistakes in the privatisation exercise. However, we must employ strategic approach in addressing the identified loopholes we have noticed overtime, not just a holistic review of the privatisation but strategic review and interventions by the government on the value chain that has not impacted post privatisation,” he said.

He noted that the notice of termination to the distribution companies could hurt inves-

tors’ confidence on the fragile power sector while calling for a divestment of weak performing Discos.

“Regarding restoring investor’s confidence, there is need for the stakeholders to accept, painfully though, the basic elements designed to sustain a successful privatisation have failed. Therefore, there should be agreement on full resetting of the market and various fundamentals used in setting the performance index of the investors in distribution assets,” Chuks Nwani, an energy lawyer and industry governance expert, told BusinessDay. Prior to resetting of the market, I will insist that the Central Bank of Nigeria finance the full metering of all customers in the distribution areas using GIS customer enumeration programme, he said.

TAJBank deepens non-interest banking with second branch in Kano SEGUN ADAMS

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AJBank Limited, Nigeria’s second non-interest financial institution, has announced the launch of its second branch in Kano State. The launch, held at the bank’s office in Kano’s city centre, hosted members of the TAJBank board of directors, guests, staff and the media.

Tanko Isiaku Gwamna, chairman of TAJBank, lauded the management and staff on the launch of the Kano office, noting, “We are a bank desirous of contributing our quota to the development of the non-interest banking sector in Nigeria and this is firmly entrenched in our mission. We have listened carefully to the yearnings of the people of Kano; as such opening our second branch in the state is a strategic decision backed only by our unwavering commitment to offer exceptional service to our customers.”

Hamid Joda, founder/chief operations officer, said, “Launching our second office in Kano has proven to be one of the best business decisions we have made so far. The city of Kano has wel@Businessdayng

comed TAJBank warmly and we are grateful for the reception we have received. We are not unaware however of the high expectations of our bank or the level of confidence placed in us, even as we have just launched into this sector.

“TAJBank is here to deliver, not just innovative products and services, but also exceptional customer service which has become our trademark.”

TAJBank offers an array of products and service offerings that are widely available to all Nigerians. Some of the products include: Partnership (Mudarabah) Term Deposit, Lease (Ijarah) Finance, Partnership (Mudarabah) Savings/Current Accounts, and much more.

TAJBank received its licence from the Central Bank of Nigeria on July 12, 2019, also offering products and services that span private banking, retail banking, business banking, development finance and the public sector.

TAJBank has its head office in Abuja and branches in Kano with major plans for expansion across the country.

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Incentives, transparent operations to attract business to Eastern ports - stakeholders AMAKA ANAGOR-EWUZIE

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aritime sector stakeholders have called on the Federal Government to intervene in making seaports in the Eastern parts of the country become more attractive to port users.

According to them, increased number of incentives given to users of services in the Eastern ports will aid in attracting shippers to use those ports.

They also call for more awareness on the use of the Port Service Support Portal (PSSP), especially in the ports situated in the East to promote

transparency and standardisation in seaport operations.

These were key takeaways from a day roundtable organised by the Maritime Anticorruption Network (MACN) in conjunction with the Convention on Business Integrity (CBI) and the Danish International Development Agency (DANIDA), with the theme “Towards Standard Operating Procedures that Works in Nigeria’s Seaports and Terminals,” in Port Harcourt, Rivers State.

Soji Apampa, CEO of CBI, said the Port Service Support Portal was targeted at eliminating corruption and “elements of delay” in port operations

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especially around vessel turnaround time.

He listed gratifications and corruption as the bane of effective and efficient service delivery at ports.

Apampa noted that MACN had implemented collective action by launching several procedures in cargo clearing at ports, adding that through joint action, more efficiency would be achieved in the system.

Moses Fadipe, deputy director, Complaints Unit of the Nigerian Shippers’ Council (NSC), pointed out that the PSSP would help to submit and track complaints by users of port services.

FG to repeal extant labour laws JOSHUA BASSEY & SEYIJOHN SALAU

... as NUPENG harps on social dialogue

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to government and it was approved,” said Keyamo.

He spoke at the annual national educational seminar of the National Union of Petroleum and Natural Gas Workers (NUPENG) held in Lagos, Tuesday, with the theme, “Creating a sustainable brand as a trade union for positive social change.”

According to Keyamo, a stakeholders’ meeting has been called to kick-start the process before approaching the National Assembly for the repeal. “What stalled the process before now was labour and some other criti-

igeria’s minister of state for labour and employment, Festus Keyamo, has disclosed that the Federal Government was planning to repeal all extant labour laws in the country.

Consequently, Keyamo has tasked labour unions to support this idea and become social partners with government on labour matters.

“We are going to bring our laws in tandem with all the requirements of International Labour Organisation (ILO). That is one of my major tasks on assumption of office, which I presented

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cal stakeholders complained that they were not carried along.

“I am instigating the process. Some drafts have been made, what we need to do is to bring in some critical stakeholders to a retreat so that when we are going to the National Assembly for the public hearing, we are all going in one voice, there will be no cacophony of voices.”

Williams Akporeha, president of NUPENG, explained that the union’s new approach to resolving industrial relations issues would be social dialogue.

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FACT CHECK: Is it FIRS chairman’s constitutional right to get tenure renewal?

OLUWASEGUN OLAKOYENIKAN

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he aftermath of President Buhari’s replacement of Federal Inland Revenue Service (FIRS) chairman- well exchair- left a slew of questions on the minds of many Nigerians. This wasespeciallytrueforseveralsocial media users who debated over the justification to the end of Babatunde Fowler’s four-year reign.

While BusinessDay’s publication laid the groundwork in answering key questions such as Muhammad Nami’s credentials- Fowler’s replacement, it is perhaps other headlines such as, “BREAKING: Buhari fails to renew Fowler’s tenure, names Muhammad Nami as successor,” that left many with mixed reactions and interesting statements.

A notable example was the statement made by President Buhari’s Personal Assistant to new media, Bashir Ahmed.

He claimed it was not a constitutional right to renew the appointment of FIRS chairman in Nigeria. He added that with the expiration of Fowler’s appointment as the chairman

of the country’s tax agency, the president was not obligated to renew his appointment. “‘Buhari fails to renew Fowler’s tenure’: this is a misleading headline. It is NOT a constitutional right to renew someone’s appointment after his or her term of office expired. Mr Fowler’s tenure expired today,” Ahmed said in a tweet which he posted via his verified Twitter handle.

The tweet has been liked more than 866 times and shared by more than 282 Twitter users since it was posted at 7:44 PM Nigerian time on Monday, December 9.

Failed FIRS Targets & the Buhari’s Administration President Buhari appointed Babatunde Fowler as FIRS chairman in August 2015, the same year the tax agency began to record shortfalls in tax revenue collections after years of surpassing its annual targets.

The shortfalls in tax collection were sustained for a period of four years to 2018, implying the Buhari-led administration continually failed to meet its tax revenue targets

since inception under Fowler’s leadership.

These consistent shortfalls by the FIRS were the reason for Abbah Kyari’s query.

We recall in August how the President’s Chief of Staff issued a query to Fowler. The query was premised on the accumulated shortfalls in tax revenue (cumulatively N3.98 trillion circa 2015-2018) and their role in the country’s failure to achieve its annual spending objectives within the past few years.

But Fowler in his reaction to the query blamed the recession as well as lower oil prices in the international market for the variances in revenue targets and actual collections within the four-year period.

Meanwhile, it is in the light of the unimpressive tax revenue remittances that the federal government plans to amend dozens of its existing tax policies through the 2019 finance bill, which has been passed into law by both chambers of the National Assembly, but yet to be signed by President Buhari.

Veritas Kapital to shore up capital base to N12bn Cynthia Egboboh, Abuja

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anagement of Veritas Kapital Assurance plc has announced its plan to shore the company’s capital base from N7 billion to N12 billion in accordance with the National Insurance Commission (NAICOM) minimum paidup capital requirements for insurance companies.

Saratu Umar Garba, secretary, Veritas Kapital, explained that the authorised share capital of the company would be increased from N7,000,000,000 (Seven Billion Naira) to N12 (Twelve billion Naira) through the creation of 10 billion units of preference shares of N0.50K each.

“Pursuant to the special resolutions (1-4) of the shareholders of Veritas Kapital Assurance plc authorising the board of directors to take all necessary steps including,

initiating and negotiating mergers and/or acquisition or any other form of business combination or arrangement with any company/ companies or institutions) whether foreign or local for the purpose of shoring up the Company’s capital, the directors have been authorised to raise additional capital through an offer of up to 10 billion irredeemable, 7-Year Convertible, Cumulative Preference Shares”.

The regulator for the Nigerian insurance sector, NAICOM, had earlier announced the increase of the minimum paid-up capital of insurance companies by over 200 percent to take effect immediately for new applications while existing insurance and reinsurance companies shall be required to fully comply not later than June 30, 2020.

As contained in the new capital base guidelines of NAICOM, “Life insurance

companies will now have a minimum paid-up capital of N8 billion from its previous minimum capital which was N2 billion, General Insurance companies will now have to recapitalize to N10 billion from the previous N3 billion, while Composite Insurance companies will now need N18 billion to underwrite businesses from the previous N5 billion minimum capital.

“The new capital base requirement also affects reinsurance companies who will now have to raise their minimum paid-up capital from N10 billion to N20 billion if they must remain in business.

“The Clause 6 of the Company’s Memorandum of Association be amended as follows: The Authorised Share Capital of the company is N12 billion divided into 14 trillion units of Ordinary Shares at N0.50K each and 10 billion units of Preference Shares at N0.50K each.”

Senate makes case for nuclear energy as Nigeria seeks Russia’s expertise KELECHI EWUZIE

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iger ia S enate has called for the inclusion of nuclear power into the country’s energy mix, as the Federal Government of Nigeria presses on with its plan to diversify the nation’s energy mix with inclusion of nuclear energy technology from Russia.

This was part of the resolution reached by the Senate recently following a motion

by Al-Makura Umar Tanko, representing Nassarawa South.

In 2017, Russia’s stateowned nuclear energy corporation, Rosatom and Nigeria signed agreements for the construction and operation of nuclear power

plants and nuclear research centre in Nigeria.

The Senate observes that the primary sources of energy for the production of electricity in Nigeria include gas, hydro, oil and coal, with current power generation capacity of 7000 megawatts.

Excerpts from a statement from the Senate note: “Further noted that experts using modern energy modelling tools had estimated that for the Nigerian economy to grow at the rate of 10 percent, the country’s electricity requirement by 2020 will need to reach 30,000mw, and by 2030 it will be 78,000mw.”

The statement further noted that the Senate was aware that nuclear energy www.businessday.ng

was one of cleanest and safest source of energy in the world today and generation does not produce greenhouse gases.

It f u r t h e r n o t e d t h e Senate was : “aware that in 2006, Nigeria ratified critical treaties with International Atomic Energy agency (IAEA) Vienna Austria, with the aim of enabling Nigeria access nuclear power into the country’s energy mix.”

Recalling that the Nigeria and Russian Federation signed bilateral agreements on Nuclear Energy cooperation, the Senate pointed out that the recent visit by Nigeria’s President to Russia was a move in the right direction to stimulate implementation. https://www.facebook.com/businessdayng

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news

Stakeholders celebrate 20 years of Nigeria’s democracy GBEMI FAMINU

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aniel Ogoloma, the 24-year-old pastor and political activist joined the Governor of Ekiti State, Kayode Fayemi, and the Governor of Sokoto State, Aminu Tambuwal, Dele Momodu and many others at an International Conference celebrating ‘20 Years of Democracy in Nigeria: 1999-2019’ at Oxford University, at the weekend.

The one-day conference was hosted by Wale Adebanwi at the African Studies Centre, University of Oxford.

The Oxford Africa conference is the leading interdisciplinary gathering covering issues and topics on Africa. The event is held yearly at Oxford to exhort knowledge from leaders across Nigeria.

Ogoloma also featured as a speaker at the Financial Times Africa Summit, featuring The Luxury Network in London, October 2019.

The theme of the event was focused on the future of Nigeria’s economy.

In his submission, Ogoloma began to paint a picture of the role played by the youth of today. He emphasises that while in theory they are not too young to run, in practice, the Nigerian youths are far too financially unstable for this and

are unable to mobilise funds without falling into the hands of political godfathers.

He carried on by drawing the attention to their mandate to create ideas and be innovative in generating opportunities across Nigeria.

“Nigeria’s population is estimated to be over 230 million people. We must be intentional in raising awareness for the next generation, my generation to know that their talent is a currency and it can be spent globally with the right platform and support,” Ogoloma stated.

“I am looking forward to building more partnerships in Nigeria with those who share the same passion as me,” he also said.

Daniel Ogoloma is a campaign expert; one of his most recent campaigns include assisting British politician, Rory Stewart, an ex-minister for international development.

Stewart recently resigned from the Conservative Party and his seat as an MP to contest for The 2020 London Mayoral elections as an independent.

“The campaign is going great so far; there has been great citizen participation through the London Speaks project. Rory believes in humanity and leadership and is keen on using London’s business links to develop jobs in countries like Nigeria,” he said.

C24 expands retail financial services offering with CPay Agent Network FRANK ELEANYA

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24 Limited has expanded its reach to provide last mile retail financial services to over 39.5 million adult Nigerians who are financially excluded with the launch of its CPay Agent Network.

On the heels of the approval in principle granted to the company as a Super-Agent by the Central Bank of Nigeria in July 2019, the company is now able to facilitate domestic payments, remittances, and sundry lifestyle outflows in communities without easy access to traditional brick and mortar bank branches.

In the latest World Bank Digital Economy Diagnostic Report on Nigeria, it posits

that African countries require five fundamental foundations to build a sustainable digital economy. Digital Financial Services and Digital Entrepreneurship are two of these foundations. “For us at C24 Limited, our CPay Agent Network provides a veritable tool to encourage the use of digital platforms to provide financial services and disrupt conventional entrepreneurship models,” says Gbadunola Sokunbi, CEO of the company.

It would be recalled that the telecommunications company, MTN also received the super-agent licence at the same time when C24 Limited got approval to pursue the same objective (OC1).

“We are aware of the stiff competition in the agency

banking and mobile money sector. But we are not deterred; our knowledge of retail finance and consumer requirements having been in this space for over a decade [OC2] significantly impacted our product development process. That is why deployment and usage of our POS terminals is free, for example and our rates are the most competitive in the market today. We have a singular focus: to contribute significantly to meeting the 95% target for financial inclusion by 2024 as set by the Central Bank,” Sokunbi said.

To many rural dwellers in Nigeria, who mostly earn less than $1 per day, accessible banking facilities could mean the difference between walking for about 3 hours to get to the nearest bank and going hungry for the day.

This is why efforts towards financial inclusion must be pursued aggressively across the nation by all concerned institutions.

According to EFInA, financial inclusion refers to “…the provision of a broad range of high quality financial products, such as savings, credit, insurance, payments and pensions, which are relevant, appropriate and affordable for the entire adult population, especially the low income segment.”

Given that over 50 percent of Nigeria’s 200 million population live in remote areas across the country, the entry of nimble and more independent players like C24 Limited through its CPay agency network will help to bring more excluded adults into the financial system.

BusinessDay photo editor wins PJAN’s 2019 Candid Photo of the Year SEGUN ADAMS

Okoesisi

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ius Okoesisi, BusinessDay photo editor, has won the 2019 Candid Photo of the Year Award

by Photo Journalists Association of Nigeria (PJAN), in recognition of his contributions to impact journalism and story-telling through pictures.

PJAN, Nigeria’s umbrella body for photojournalists, presented the award during its first national conferences and awards night held in Lagos, weekend.

“The award speaks volume to the effort put into photojournalism by BusinessDay,” said Okoesisi, who received the award, “I will continue to give my all to good journalism through pictures.”

The candid category is based on pictures captured without creating a posed appearance. That is, the

photographs were taken with the subject(s) unaware.

As such, candid photos are able to present interesting and factual perspectives, which are unbiased and resonates with the core values of other forms of journalism.

Asides the candid photo category, the event also featured other categories such as the News category, Health category, Environmental cat e g o r y , D o c u m e nt a r y category, Sports/fashion and culture category and a category for the PJAN 2019 photojournalist of the year.

More than 175 entries were received from several media outlets across Nigeria.

The event was also a conference for the visual artists to deliberate and proffer solutions to Press Photography and the challenges of multimedia.

“In the last few years, we have recorded tremendous development professionally,” said Ademola Akinlabi, chairman PJAN. “ T h ro u g h o u r s e m i na r s and workshops, our knowledge of photojournalism is increasing.”

According to PJAN, photojournalists are crucial to promoting the virtues in society and it would continue to support its members across the country to maintain high standards in their practice.

PJAN is affiliated to Nigeria Union of Journalists and is as old as the latter, with members across the federation and over 100 in Lagos alone.

L-R: Nkechi Onyeso, head, corporate services, Nigerian Economic Summit Group (NESG); Asue Ighodalo, chairman, NESG; Folasade Yemi-Esan, acting head of the Civil Service of the Federation, and Aigboje Aig-Imoukhuede, co-chair, private sector, Governance and Institutions Policy Commission (GIPC), NESG, at the just concluded Governance and Institutions Policy Commission (GIPC) General Assembly and End of Year Cocktail at the NESG Summit House in Lagos.

Sanwo-Olu terminates appointment Stakeholders raise concerns on inclusive growth for economic sustainability of LASAA MD bear on the work of the Lagos JOSHUA BASSEY

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agos State governor, Babajide Sanwo-Olu, has terminated the appointment of Bolaji Sanusi, managing director, Lagos State Signage and Advertising Agency (LASAA).

Sanwo-Olu replaced Sanusi with Adedamola Docemo, who assumed office Monday.

Although no official reason has been given for the refusal of the governor to re-appoint Sanusi, who was first appointed to the seat by the immediate past governor of the state, Akinwunmi Ambode.

The out-gone MD was said to have received the news as a shock, as he never expected it.

The letter appointing the new MD to replace Sanusi, dated December 7, 2019, was signed by Hakeem Muri-Okunola, Head of Service, Lagos State.

It read in part: “In approving your appointment, due cognizance has been taken of your integrity, selfless services and record of impressive performance. I, therefore, have no doubt that you will bring your wealth of experience to

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State Signage and Advertising Agency and continue to justify the confidence reposed in you by the governor.”

Meanwhile, a statement issued by the state government and signed by Gboyega Akosile, the chief press secretary to Governor Sanwo-Olu, issued on Tuesday, December 2019, said Docemo’s appointment took immediate effect from Monday, December 9, 2019.

It read: “Docemo’s appointment followed a vacancy created by the expiration of tenure of the former managing director, on September 13, 2019.

An industry expert, Docemo is an accomplished professional with over 12 years cognate experience in outdoor advertising, media, telecommunications and engineering sectors.

Prior to his appointment, Docemo was the CEO of Viadotech Limited, a foremost player in the outdoor advertising, telecommunications and engineering sectors in Nigeria.

He also worked at various times with Bell & Bell telecommunications Limited, Private Networks Nigeria Limited and Emotion Advertising Limited.

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GBEMI FAMINU

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ith Nigeria’s gross domestic product (GDP) of 37.8 trillion, population growth rate at 2.7 percent, and GDP growth rate at 2.28 percent, the need for growth to be more inclusive has been emphasised.

Experts on economic matters, who say promoting inclusive growth is pertinent, argued that the population growth rate, which is clearly above the GDP growth rate, has further depressed the nation’s GDP per capita.

Specifically, they say while growth has remained positive since the country exited recession in 2017, the third quarter 2019 report on annual growth rate at 2.28 percent, shows that growth is arguably fragile.

Deputy governor of the Central Bank of Nigeria (CBN), Aishah Ahmad, who spoke on “Financial Inclusion as a Tool to Unlock Nigeria’s Potential and Enable Inclusive Economic Growth,” at the EFInA 2019 Financial Inclusion Conference, pictured the economy as being of weak growth, weak recovery, @Businessdayng

poor productivity, and rising income inequality.

Noting that the power to sustainable inclusive growth is hinged on women’s economic empowerment, she said: “Given that if this current weak global growth environment persists, coupled with increasing moves to change the energy structure from fossil fuels to non-fossil fuels that will affect the demand of oil, there is potential that all prices will be depressed, and this will threaten our physical consolidation efforts.”

During the launch of study on “Assessment of Women’s Financial Inclusion in Nigeria” by EFInA and the CBN, Ahmad, who spoke on the need to strengthen financial literacy and women’s education, added that the apex bank has approved some guidelines on unfair treatment, complex disclosures, and transparency for the industry that would be launched before the end of year.

Chair, Board of Directors, EFInA, Segun Akerele, said co-ordinated actions by all critical stakeholders to work across institutions to unlock barriers in financial inclusion was paramount.

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FINANCIAL TIMES

World Business Newspaper BRENDAN GREELEY

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s the Federal Reserve meets in Washington this week, investors are almost unanimous in betting that the US central bank will keep interest rates unchanged at 1.51.75 per cent. Not only that; financial markets think the main policy rate target is most likely to remain unchanged until November next year, according to CME Group’s FedWatch tool.

This is against a backdrop of stellar US jobs numbers, which last month showed unemployment back at 3.5 per cent and wages continuing to rise. All of which poses the question for chairman Jay Powell heading into 2020: if not the lowest unemployment rate since 1969, what might change the Fed’s mind?

“Let’s not be confused here about this discussion of whether the Fed is dovish or not,” says Ethan Harris, head of global economics research for Bank of America Merrill Lynch. “This is the most dovish Fed ever.”

Obituaries of Paul Volcker, who ran the Fed from 1979 to 1987 and who died on Sunday, have focused on his Herculean effort to overcome Seventies-era inflation in the US. In the past year under Mr Powell, in the post since February 2018, the Fed has swung sharply toward the other half of its dual mandate: maximum employment.

Since January the Fed has signalled, then carried out, a quick series of three rate cuts, explaining them as an accommodation to a global slowdown.

US labour market gains drive Federal Reserve’s outlook

Central bank set to keep rates low as it seeks to drive unemployment down further

Federal Reserve chairman Jay Powell

But Priya Misra, head of global rates strategy at TD Securities, said Wednesday’s announcements and press conference may indicate the Fed’s long-term thinking on unemployment is changing, and monetary policy that looked accommodative as it began to cut this summer may only now be at neutral.

The neutral rate is the rate at which central bank policy would neither restrain nor stimulate growth.

If it has fallen, the Fed has no reason to make any changes in 2020, Ms Misra said.

“Maybe you don’t need to take back these cuts,” she said. “Because all you did . . . was unwind the hikes which shouldn’t have happened, because we’ve reassessed [where] neutral [is].”

If the Fed has reassessed, it will show up on Wednesday in the “dot plot” which shows central bank officials’ individual, anonymous estimates of the appropriate long-term policy rate, she said.

Mr Powell himself brought up the neutral rate in his most recent public outing. Speaking to a group of busi-

ness owners in Providence, Rhode Island, last month, Mr Powell said no one can measure the neutral rate directly, but Fed estimates of this rate had been dropping since 2012, including over the past year.

Line chart of Officials’ projections of longer-run policy rate, median (%) showing The Fed’s estimate of ‘neutral’ keeps dropping Ms Misra said she did not expect the dot plot’s median forecast of 2.5 per cent to change.

“But I wonder [if ] that starts to spread out a little bit more,” she said.

“Right now there are three officials who are below 2.5. There may be a couple that might get added to that list.”

Mr Powell may be asked on Wednesday about a major review the Fed is conducting of its monetary policy tools, due for completion next year.

As part of that review, Fed officials showed up around the country at “Fed Listens” events, an attempt to talk to community leaders and regular workers, and the chairman has a chance to show what it learnt as it listened — and whether what it heard changed the way it viewed its 2019 rate cuts in hindsight. “[Fed officials’] reactions to the Fed Listens events seems to be notable and real,” said Tim Duy, economist at the University of Oregon. “They have clearly become more focused on the benefits of persistently low unemployment rates.”

Over the course of this year, according to Mr Duy, “what we have learnt is that we can push unemployment much lower for longer periods of time without creating inflation than the Federal Reserve believed to be the case maybe a year or certainly two years ago”.

Mr Powell frequently brings up his public listening sessions, and appears to genuinely enjoy them. In Providence he suggested that they had changed his mind as well.

Africa’s Amazon hopeful Jumia retreats from big expansion

Donald Trump puts Tokyo under pressure to choose US fighter jet over rival BAE One-time unicorn quits Rwanda after Cameroon and Tanzania as US-listed shares fall 90% from high

Japan is looking at UK company to develop an alternative to its F-2 aircraft DEMETRI SEVASTOPULO AND ROBIN HARDING

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he Trump administration is pressuring Japan to choose a US defence company to develop jointly a replacement for its F-2 fighter jets as Tokyo considers a British alternative to cut its reliance on American weapons.

Pentagon officials have stepped up talks with Japan amid concerns the US could lose out to BAE Systems, the UK defence contractor developing a sixth generation Tempest stealth fighter, according to three people familiar with discussions about the F-3 programme.

Tokyo wants to replace its F-2s when they retire from around 2035 and plans to start development next year, in a deal that would be worth tens of billions of dollars. It is considering three options: collaborating with BAE; working with Lockheed Martin, the US maker of the F-22 and F-35 jets; or developing a plane domestically.

The US air force is worried that choosing a UK fighter would create interoperability issues. American officials are also concerned that opting for a British jet would anger President Donald Trump, just as Washington and Tokyo are engaged in tough talks about how much each should pay towards maintaining their alliance.

The US stunned Japan in July when it said it would request a fourfold increase to $8bn when the allies

renegotiated the “special measures agreement” that determines their contributions.

Eric Sayers, a Japan expert at Beacon Global Strategies, an advisory firm, said Japan would be making its fighter jet decision just as tensions “could be boiling” over cost sharing.

“Tokyo should be able to make its own sovereign decision about which option . . . to replace the F-2,” he said.

“But President Trump has a record of taking a transactional approach to alliances and the Abe government should not expect he will view the special measures agreement negotiation and this large procurement decision as separate.”

Mr Trump has made Japan, and his own military officials, nervous by threatening to withdraw troops unless Tokyo pays more. He has also frequently touted Japanese purchases of US weapons in his meetings with Prime Minister Shinzo Abe. Taro Kono, the Japanese defence minister, recently told the Financial Times that he was open to collaboration with a European programme such as Tempest, underlining the concerns in Washington.

One senior US defence official stressed that Japan should view interoperability as “a significant factor” to consider. “Because of the importance of the alliance and the current security dynamics in the region, we would obviously prefer the Japanese work with the US on their future fighter programme,” the official said. www.businessday.ng

NEIL MUNSHI

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umia, the pan-African ecommerce company, will close its business in Rwanda, just weeks after it exited Cameroon and Tanzania, in the latest sign of retrenchment for the one-time unicorn whose share price has fallen nearly 90 per cent from its high after listing in Wall Street in April.

The closures bring Jumia’s footprint in Africa to 11 countries and point to the difficulty of running an ecommerce business across a continent with weak infrastructure, under-developed logistics and a general lack of trust in online shopping.

It also puts a dent in what the Rocket Internet-backed company has long touted as one of its key advantages: scale.

Sacha Poignonnec, co-chief executive, said the exits were routine, as the company reassesses its markets, products and services.

He noted that in the past, it had left countries such as Mozambique and closed its ride-hailing business. On Tuesday, Jumia also said it is in effect shutting its travel website.

“It’s a continuity of recent changes and the strategy is very much for us, it’s very simple, we are engaged in taking Jumia to profitability and drive penetration of JumiaPay,” he said, referring to the company’s payments platform.

“Sometimes we make decisions to change the scope of countries or categories . . . but it is in the normal

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life of a company to adjust the focus, but the strategy remains very much the same.”

The company said the moves were part of a “portfolio optimisation strategy” it announced in November.

Mr Poignonnec emphasised the need to control costs. Losses grew to €54.6m in the third quarter from €40.6m a year earlier, while revenues missed analyst estimates for the second time in three quarters.

Jumia has run up more than $1bn in losses since launching in 2012 in Nigeria.

But Mr Poignonnec cited the success of Amazon, China’s Alibaba and Latin America’s Mercado Libre as proof that the model Jumia is pursuing can work. He pointed to Jumia’s rising customer and seller numbers as positive signs.

As part of its growth strategy, the company has shifted focus toward its JumiaPay fintech platform, on which transaction volume nearly doubled to €32m in the third quarter from a year earlier.

Fintech is the hottest tech sector in Africa, with nearly $400m pouring into three Nigeria-based start-ups in a week in November as venture capital firms bet on companies trying to bring online the roughly 99 per cent of African transactions that are done in cash. Jumia believes its payments service will be key to unlocking ecommerce.

Investors have so far been unconvinced.

Jumia listed on the New York Stock Exchange to great fanfare in @Businessdayng

April, becoming the first Africafocused start-up worth more than $1bn. Shares peaked at $49.77 weeks after their debut but have steadily fallen to $5.96, giving it a market capitalisation of just $458.3m, about a tenth of its all-time high.

In May shares fell by roughly a quarter after the short seller Citron Research released a report accusing the company of fraud, which it denied.

Observers said Jumia faces competition from companies that ship to Africa from overseas, such as Amazon, and local small businesses that are increasingly offering online shopping.

“If I want an iPhone, Jumia will say it takes 21 days, and Amazon will send it in a week, they will remove the VAT and deliver it straight to my door,” said Uzoma Dozie, a tech investor who was chief executive of Nigeria’s Diamond Bank.

“With Jumia it’s a different story altogether — it will cost more, it will arrive later and then there is the trust issue.”

He also pointed to the advantages small sellers have over a behemoth such as Jumia.

“Small businesses on Instagram are beginning to eat into Jumia . . .[by] doing things faster, cheaper and with a sense of security,” he said. People are willing to buy on Instagram because “when you go to Instagram, they see pictures of people they know wearing the clothes — there’s not that social aspect to it on Jumia, which is more transactional”.

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Nissan to be fined $22m for misstating Carlos Ghosn’s pay

Carmaker does not intend to ‘dispute the alleged facts’ or amount of the penalty KANA INAGAKI

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apanese regulators have demanded a ¥2.4bn ($22m) fine from Nissan, alleging it understated pay for its former chairman Carlos Ghosn over a four-year period.

The Securities and Exchange Surveillance Commission (SESC) has also disputed some of Nissan’s findings from an internal probe on Mr Ghosn’s pay, which was at the centre of allegations that led to his arrest last November.

In a statement on Tuesday, Nissan said it takes the recommendation seriously. “In the absence of any special circumstances or other reasons, the company intends not to dispute the alleged facts and the amount of the . . . penalty.”

Since his arrest last year, Mr Ghosn has been charged with four counts of financial misconduct, two of which accuse him of failing to report more than $80m in deferred compensation.

He has denied all the charges.

His lawyers say Nissan’s securities filings accurately disclosed Mr

Ghosn’s compensation and that the company never committed to pay, nor did the former chairman ever receive, any unreported compensation.

Nissan revised its accounts for its financial years 2013 to 2017 in May, but the SESC’s findings did not match the revised figures. The SESC’s investigation covered only the past five years because of a statute of limitations.

The company’s internal probe found that Mr Ghosn allegedly received about ¥140m more than he should have, by extending the date when his share appreciation rights — which link pay to share price rises — were exercised. Former chief executive, Hiroto Saikawa, and several other Nissan executives were also improperly overpaid using the same scheme, the company has said.

The SESC said it could not determine whether Mr Ghosn’s SARlinked compensation should have been disclosed for the two years until March 2018, highlighting the ambiguity of Japanese disclosure regulations for pay that is linked to share performance.

Two articles of impeachment expected against Donald Trump Democratic counsel says US president poses ‘clear and present danger’ to elections LAUREN FEDOR

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emocrats are expected to unveil two articles of impeachment against Donald Trump as soon as Tuesday, after the party’s legal counsel warned the president poses a “clear and present danger” to US elections and national security.

Nancy Pelosi, speaker of the House of Representatives, met the chairmen of Democratic committees on Monday night, after a marathon session of the House judiciary committee at which lawyers for both Democrats and Republicans presented evidence from the impeachment inquiry.

Democrats agreed on two articles of impeachment charging the president with abuse of power and obstructing Congress, according to two people briefed on the discussions. Talks about a possible third article to charge the president with obstruction of justice linked to the Mueller report into Russian interference in the 2016 US presidential election had not concluded.

Jerrold Nadler, the Democratic congressman from New York who chairs the judiciary committee, had earlier said Mr Trump had “put himself before country” and his “pattern of conduct represents a continuing risk” to the US. Mr Nadler’s judiciary committee took the reins of the impeachment inquiry last week, after the House intelligence committee, chaired

by California congressman Adam Schiff, produced a 300-page report accusing Mr Trump of abusing his office for political gain and trying to obstruct the ensuing congressional investigation. The report was based on both public and closed-door testimony from more than a dozen witnesses.

Mr Nadler said at the weekend

that his goal was to vote on articles of impeachment “as fairly as possible depending how long it takes”.

Many Democrats expect the committee to draft and vote on articles of impeachment this week, ahead of a vote on the House floor before Christmas.

Mr Trump is expected to be impeached by the Democrat-controlled House, but is likely to be acquitted in an eventual trial in the Senate, where Republicans have a majority.

Republicans have accused Democrats of rushing the impeachment process ahead of next year’s presidential election in November. With less than two months to go until the Iowa caucuses, an impeachment trial early next year in the Senate could also coincide with the Democratic primaries.

Mr Nadler defended the timeline on Monday, saying: “I want to be absolutely clear: the integrity of our next election is at stake. Nothing could be more urgent.”

His comments were echoed

by Democratic counsel Daniel Goldman, who said the president’s “persistent and continuing effort to coerce a foreign country to help him cheat to win an election is a clear and present danger to our free and fair elections and to our national security”.

Steve Castor, the Republican counsel, rejected the Democrats’ claims and characterised the impeachment process as “unfair”.

“To impeach a president who 63m people voted for over eight lines in a call transcript is baloney,” he said.

Mr Trump did not directly comment on Monday’s hearing, but took to Twitter throughout the morning to share messages such as “Witch hunt!” and “The do nothing Democrats are a disgrace!” www.businessday.ng

Saving the African grey parrot: the battle to beat the pet smugglers How Zoological Society of London is tackling global gangs that threaten the birds’ survival in wild DAVID PILLING

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he first thing to know about the African grey parrot is that it is not grey. Not entirely at least.

The medium-sized bird, which lives in forests in west and central Africa, has electric-red tail feathers that make it a target for poachers, who use the plumage for ceremonial headdresses.

Its body parts are used in traditional medicine.

Unfortunately for the African grey, these are the least of the species’ problems. A highly intelligent animal capable of mimicking human speech and which can live in captivity up to the age of 60, it has also been a soughtafter pet since biblical times.

In an era when the international pet trade has reached industrial proportions, the demand — from the Middle East and Asia as well as Europe and North America — threatens the African grey’s long-term existence in the wild.

The parrot inhabits a strip of equatorial forest that runs from Ivory Coast through Nigeria, Cameroon and Gabon and into the Democratic Republic of Congo. In Ghana, where poaching has been intense, the population has fallen more than 90 per cent since the early 1990s, according to estimates. Numbers of birds in other countries are difficult to gauge, but experts at the Zoological Society of London, the FT’s Seasonal Appeal partner for 2019, say they are falling sharply.

So acute has the problem become that the Convention on International Trade in Endangered Species of Wild Fauna and Flora (Cites) outlawed trade of the African grey altogether in 2016. Before the ban, about 1.3m parrots had been exported legally

since 1980, according to estimates, excluding the hundreds of thousands that likely died during trapping and transportation.

Conservationists are divided over the efficacy of the ban. Samuel Nebaneh, a law enforcement coordinator in Cameroon, which has a large population of grey parrots, welcomes it. “It has had a positive effect. Some parrots have been seized and traffickers have been sent to trial,” he said.

Map showing illegal parrot trade flows around the world Others say the ban has driven up prices, and therefore the incentive to poach, as well as prompting trappers to use longer smuggling routes where the birds are more likely to die en route. An African grey can retail for £1,000.

Pamela Watson, an author who kept two African greys when she lived in the Nigerian city of Lagos, said the Cites ban was inadequate without work at village level to give people alternative incomes.

“They’re not able to stop it because the traffickers are armed. This is a huge business. There are international gangs behind this,” said Ms Watson, who now lives in London and has been unable to obtain an export licence for her parrots, which remain with friends in Lagos. After having the parrots for years and realising how intelligent they were, she said, she would not now advocate keeping them in captivity.

In 2014, Mr Nebaneh encountered a Ghanaian poacher in south-west Cameroon who had been exporting trapped birds in batches of 500.

In Cameroon, parrots are caught in forest clearings where they congregate in huge numbers. Trappers take advantage of their sociability,

smearing glue on to palm fronds and branches and tethering decoy birds, which call out and attract victims to the area. The parrots become stuck and many perish through lack of food and water before trappers come to collect them. Sometimes hunters cast nets over whole flocks.

ZSL is working with authorities in Cameroon to try to halt smuggling, intervening at all levels of the supply chain. It sets up camera traps to monitor wild populations, works with local communities to discourage poaching and provide alternative livelihoods, and helps train eco-guards and border officials to recognise and stop the trade.

When birds are seized, as well as helping authorities prepare for trial through expert witnesses and record keeping, ZSL teaches eco-guards how to care for the birds and return them to the wild.

Hauls of 100 or more are not uncommon, but all too often the parrots, malnourished and traumatised, die before they can be rehabilitated.

Gary Ward, curator of birds at London Zoo, visited Cameroon’s Dja reserve in November to help ecoguards care for seized parrots, including providing appropriate aviaries and food supplements. “The husbandry training is pretty basic,” he said. “We’re not trying to train them how to breed the parrots, just to keep them alive.”

Eleanor Harvie, ZSL’s programme manager for Africa, said the ecoguards were easy to motivate, as it was more rewarding to seize live birds than, say, the tusks of an elephant or the scales of a pangolin that had already been killed. While understanding of the parrots’ numbers in the wild remained sketchy, she said, there might be enough to make preservation a realistic goal.

Brazil set to overtake US as world’s largest soyabean producer American farmers hit by US-China trade conflict and extreme weather GREGORY MEYER AND ANDRES SCHIPANI

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razil is racing ahead of the US as the world’s largest soyabean producer, as a trade war and extreme weather take a toll on American agriculture.

The Latin American country’s newly planted crop is likely to yield 121.1m tonnes of soyabeans in early 2020, agricultural agency Conab said on Tuesday. That is 25 per cent more than the just-harvested US crop of 96.6m tonnes.

“This is the first time ever, it appears, that we will have a smaller crop than Brazil,” said Jim Sutter, chief executive of the US Soybean Export Council, a trade promotion body.

Soyabean flows were caught in the US trade war with China, the dominant importer of the oilseed. The 25 per cent tariff that Beijing imposed on UScultivated supplies remains in place as the two countries negotiate new terms

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on trade and industrial policy.

“This unresolved agreement brought a very good momentary opportunity for Brazil,” said Tereza Cristina da Costa, Brazil’s agriculture minister.

Column chart of Annual production (million tonnes) showing Brazilian soya crop surpasses US Brazilian farmers have planted 36.8m hectares with soyabeans, Conab said in its latest monthly estimate.

The area devoted to soyabeans has expanded by about 1m hectares a year on average over the past decade, some of it into areas of native vegetation.

“The increase in soy production in the country is a reflection of the producer believing in the country’s future,” said Rodrigo Pozzobon, a delegate of Aprosoja, a farm co-operative in the Brazilian state of Mato Grosso.

Demand for Brazilian soyabeans has supported their price, with supplies at the port of Paranaguá quoted for $363.50 a tonne this week, com@Businessdayng

pared with $348 a tonne on the US Gulf Coast, according to Reuters.

Soyabean futures in Chicago traded for $8.985 a bushel early on Tuesday, fractionally higher on the day but about a dollar below levels before China’s tariff took effect in mid-2018.

The Brazilian real has dropped about 7 per cent against the dollar over the year, increasing the value of soyabeans to Brazil’s farmers.

“The strong dollar is really giving a signal to other producers around the world to step up their production if they can, because it’s giving them pretty good prices, and the strong dollar is kind of having the opposite effect on US producers,” said Mr Sutter.

President Donald Trump last week threatened to impose tariffs on steel and aluminium from Brazil and Argentina in response to weakness in their currencies that he said was “not good for our farmers”. Argentina is the world’s third-biggest soyabean producer.

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FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

US stocks slide in early trade as investors debate tariff deadline Reports of extension to December 15 deadline prompt turnround in US and European markets

PETER WELLS AND ANNA GROSS

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S stocks and Treasury yields slid in early trade, taking a cautious response to media reports Washington and Beijing had signalled a Sunday deadline for the imposition of new round of tariffs on Chinese imports could be extended.

Trade negotiators from the US and China have indicated in recent days that December 15 is not necessarily the final date for duties to increase on $165bn of imports if a so-called “phase one” deal is not reached beforehand, the Wall Street Journal reported about an hour out from Wall Street’s opening bell on Tuesday.

The S&P 500 was down 0.3 per cent in early trade. Futures for the benchmark had swung into positive territory following the media report on the tariff deadline, having been as much as 0.6 per cent lower beforehand.

The Nasdaq Composite was also down by 0.2 per cent, while the Dow Jones Industrial Average shed 0.3 per cent.

Treasuries and the US dollar also trimmed earlier declines. The yield on the benchmark 10-year Treasury was down 1.2 basis point at 1.819 per cent, having been as low 1.8 per cent earlier. The dollar index recovered to

be 0.1 per cent lower at 97.546.

The news also prompted a recovery for European markets, which wallowed for much of the day on concerns a breakthrough on the trade talks remained elusive.

Europe’s broad Stoxx 600 composite index was down 0.6 per cent and still on course for back-to-back declines, but had been down as much as 1.1 per cent in morning trading. The London-based FTSE 100 recovered to be 0.5 per cent lower.

The trade-sensitive Dax in Germany was down 0.9 per cent, while France’s Cac 40 sat 0.3 per cent weaker.

In a busy week, the US Federal Reserve provides its latest policy announcement on Wednesday, while the results of the UK general election will flood in early on Friday and present the possibility of fresh political risk for markets.

Trading was a little more muted in Asia. The Hang Seng index was down 0.2 per cent in Tuesday trading, though the Chinese benchmark SSE was up 0.1 per cent.

The pound has held on to gains made on Monday, rising a further 0.2 per cent against the dollar, as traders remain confident that the Conservative party will win a majority in Thursday’s election.

New fintechs are rediscovering the old lesson that service matters We are seeing a return to competition that differentiates on quality rather than just price IZABELLA KAMINSKA

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any of the new challenger banks and fintech companies boast that what differentiates them from the big incumbent lenders is that they are “customer obsessed”.

Their focus on providing a different kind of customer experience has led to snazzy digital and mobile interfaces, top-notch design, free giveaways and, in many cases, commission-free services for clients. But it is not yet clear whether this strategy will lead to profitability for the likes of Monzo and Revolut.

That’s because most banks are first and foremost in the business of lending, and only second in the business of helping people manage their money. Meanwhile, customers tend to see both services as utilities and use price as the primary comparison point. Additional bells and whistles may be appreciated, but customers won’t necessarily be prepared to pay more for them.

Indeed, despite huge regulatory efforts in the UK to make it easier to switch banks to take advantage of new competition, customers remain stubbornly attached to the accounts they opened as young adults. All the more so now that incumbents from NatWest to Barclays have raised their game when it comes to digital and mobile services, copying or buying start-ups that offer customer-oriented techniques.

The risk for challengers is that, having played their part in getting the industry to improve the customer experience and service, they might end up with very little to show for it.

That, frankly, feels unfair.

I think what is really going on is a re-

turn to competition that differentiates on quality rather than just price. The reason it feels so new and cutting edge is that price has been the calling card of the challengers, not just in banking but in other retail markets, such as groceries and air travel, for many years.

In retail, the UK saw a decades long face-off between supermarket chains Tesco and J Sainsbury, in which the former relied on aggressive price-cutting techniques and free giveaways, and ultimately pulled ahead. A key starting point in the war was the great trading stamp controversy of 1963, which eventually led to the proposition of the Trading Stamps Bill in 1964.

Trading stamps, an American invention, were a form of loyalty coupon given to customers entitling them to heavily discounted or “free” products at participating retailers.

Although trade associations objected to the stamps as a disguised form of deliberate undercutting on price, Tesco signed up to participate in the biggest scheme, run by the Green Shields Company.

Sainsbury’s responded by arguing that the stamps were only tricking customers into thinking they were getting something for free, because they were actually paying through poorer product quality and higher prices overall. It launched a high-profile advertising campaign emphasising its commitment to quality and value, using the slogan, “Honest to goodness”. Both the bill to regulate stamps, and a proposal for grocers to form a gentleman’s agreement to put a floor on undercutting via stamps, failed.

They were perceived by customers and parliamentarians as incumbent protectionism. www.businessday.ng

A teenager watches someone else playing Fortnite on the live-streaming video platform Twitch © Frank May/dpa/Alamy

Voters face stark choice to fix the UK’s housing crisis

Tories are focused on home ownership while Labour plans a huge programme of social housing DELPHINE STRAUSS

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ritain’s housing crisis was on full view at a general election hustings in London last week. Will, from Exmoor in south-west England, said he was living with his parents at the age of 29 because national park building restrictions and second homeowners had priced him out of the market. Sarah, a multiple sclerosis sufferer, described cockroaches, 11pm curfews and water pouring through the ceiling in the temporary accommodation she shared with her teenage son.

Their stories, and many others, held few surprises for the politicians taking questions. “I have cases like yours to deal with all the time,” Sian Berry, the Green party’s co-leader, told Sarah. Tom Brake, the Liberal Democrats housing spokesman, said that benefits payments would not cover rent for the cheapest one-bed flat advertised in his constituency.

With young people increasingly unable to aspire to home ownership, and millions still shuttling from one rented property to another even after having children, housing is one of the top priorities for many UK voters.

Although house construction has increased in recent years, it still falls short of government targets and little more than a quarter built last year meet even a broad definition of “affordable”.

The proportion classed as social housing, with the cheapest rents, is near historic lows.

Column chart of Permanent dwellings completed in England (‘000s) showing For more than four decades the private sector has built the majority of new homes The issue has received little attention in an election campaign dominated by Brexit and the National Health Service.

Voters are being offered a stark choice, between traditional Conservative support for home ownership and a Labour pledge of a massive government programme to build social housing. The Liberal Democrats also focus on building social housing, although with a lower level of ambition. The

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question is whether any party can deliver on these promises.

All the main parties plan a big push to build more affordable homes.

The Conservatives have maintained their target of building 300,000 homes a year by the mid2020s. However, their concrete promise of “at least a million more homes” over the next parliament is more modest — implying a slower rate of building than that seen during the past year — and largely reliant on the private sector. It includes all tenures.

Former prime minister Theresa May’s pledge of a “new generation of council homes” has been dropped.

Boris Johnson, her successor, has instead promised to restore the Conservatives’ traditional reputation as “the party of home ownership. The party’s manifesto includes measures to encourage a new market in long-term fixed rate mortgages; allow councils to use developers’ contributions to fund big discounts for local first time buyers; and extend Help to Buy, a scheme aimed at assisting those who might not otherwise be able to afford to buy but has been widely criticised for inflating prices without adding to the supply of affordable homes.

Industry experts are sceptical these schemes will work. There has been little demand so far for 10-year fixed rate mortgages and Neal Hudson, an independent housing market analyst, said that, while the scheme for discounted homes “looks brilliant on a piece of paper”, it could be derailed by technical difficulties over valuation and resale.

Labour’s proposals are more radical, with shadow minister John Healey promising a “housing revolution”. The opposition party would embark on a state-led building programme on a scale not seen for 70 years. The public sector would deliver 150,000 homes a year by 2025, two-thirds of them built by councils for social rent with £75bn of investment — funded by borrowing — from central government.

The party would also create an English sovereign land trust, with powers to buy land more cheaply @Businessdayng

for low-cost home construction; end the right for council tenants to buy their properties; and help local authorities buy back properties from private landlords.

Again, the main doubt is delivery: whether councils can rapidly ramp up their building programmes without crowding out the private sector. Hansen Lu, at the consultancy Capital Economics, described Labour’s policy as a “wild card”, arguing that if implemented well, it could achieve its aims with little collateral damage to the private sector — but, if poorly designed, the policies could end up doing more harm than good.

One area in which all parties have pulled their punches is property taxation. Labour would introduce new levies on holiday homes and empty properties and the Conservatives are proposing a stamp duty surcharge on nonresident buyers. But more radical proposals previously floated by Labour, for example replacing council tax with a tax on property values, have not materialised.

There is one area of cross-party consensus: providing more security for the millions with little hope of reaching even the first rung of the property ladder. All parties have proposals to end “no fault” evictions by private landlords.

The Conservatives plan to introduce “lifetime deposits” that could move with renters between tenancies. Labour has more controversial plans for rent controls — intended to protect tenants from arbitrary rent rises, but a potential deterrent to landlords investing in the upkeep of their properties.

Lindsay Judge, an analyst at the Resolution Foundation thinktank, said the biggest concern — over and above the lack of realism in both parties’ house building plans — was the potential impact of the schism between the major parties’ priorities.

“Housing promises usually take years to deliver in full, and the effects of big policy shifts are often felt decades down the line,” she wrote in a recent analysis. “There is a risk of policy flip-flops for years to come, something which is unlikely to help the many families for whom housing is a serious living standards challenge.”

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ANALYSIS

Morgan Stanley fined €20m over European bond trades Bank to appeal after French regulator imposed fine for ‘aggressive’ market activity TOMMY STUBBINGTON

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organ Stanley has received a €20m fine from France’s markets regulator for allegedly manipulating the price of government bonds in 2015.

According to a decision published on Tuesday by the Autorité des Marchés Financiers, Londonbased traders at the bank “aggressively” purchased futures contracts linked to French bonds in order to cause an “abnormal and artificial” increase in the price of French and Belgian bonds it held.

“These acts also constituted price manipulation through the use of a form of deception or contrivance, since the [futures] acquisition was inconsistent with the overall strategy of the European Government Bonds Desk and had the effect of giving other participants a distorted picture of the state of the French sovereign bond market,” the AMF’s enforcement committee said in a statement.

Morgan Stanley said it was “disappointed” in the finding and intends to appeal against the decision. “The activities in question were undertaken in accordance with market practice and as part of the firm’s role and obligations as a market maker and Morgan Stanley remains confident that it has acted in the best interests of the market and its clients,” the bank said in a statement.

The trades in question took place on June 16 2015, at a time when fears that Greece might leave the euro-

zone were fuelling sharp swings in bond markets, including in Morgan Stanley’s positions. Following its activity in the futures market, the bank sold €815m of French bonds and €340m of Belgian bonds, the AMF noted on Tuesday.

At a hearing last month, the AMF said Morgan Stanley’s trading desk made the futures purchases in order to avoid large losses on its bond holdings, in a technique the regulator alleged was reminiscent of Citigroup’s so-called “Dr Evil” trade, which led to the bank being fined

by UK regulators for its activity in Italian bond markets in 2004.

Stéphane Bénouville, a lawyer for Morgan Stanley, told the hearing that its futures trades were made to unwind a hedge on its cash position, and that they were too small to move the market in cash bonds.

“To imagine that we can vary the French debt market by buying less than 2 per cent of the average daily volume of futures contracts is an aberration,” he said.

The fine is the second largest handed out by the AMF. In determining the size of the penalty, the regulator said it took into account the fact that the trading desk in question generated a profit of roughly $200m during the year in which the alleged manipulation took place.

The AMF said Morgan Stanley’s actions were particularly serious thanks to the bank’s status as a “primary dealer” in French debt — one of a group of investment banks that helps the government sell new bonds.

Fund managers push against the flow in global macro Two launches in two weeks amid strong demand from institutional investors EVA SZALAY

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ome investors are betting that rumours of the death of the global macro fund have been greatly exaggerated.

US asset manager Neuberger Berman on Monday announced the launch of a “macro opportunities” fund, focused purely on major currencies. Specialist currency manager Adrian Lee & Partners, which manages $14bn of assets, announced the launch of a global macro fund late last week. Both target high single-digit annual returns.

Global macro strategies — which bet on big price moves driven by geopolitical developments — have suffered poor performance since central banks flooded global markets with liquidity, suppressing volatility and denting returns. Last month, Louis Bacon, the founder of Moore Capital Management, decided to shut its flagship hedge funds to outside investors after three decades.

The managers behind the new fund launches reported strong demand from institutional investors, especially given nerves that the long bull run in equities might be coming to an end.

Ugo Lancioni, head of currency management at Neuberger

Berman, will be responsible for its fund. His team manages nearly $10bn of assets in active currency strategies, using fundamental analysis and bets that pit one asset against another. Neuberger Berman has $300bn under management across different asset classes.

Mr Lancioni said he was confident that this is the right time to set up a macro fund, as bond yields remain low while equity prices look increasingly stretched after multiyear gains. “Investors are increasingly looking for alternative sources of return in liquid markets, which could provide some measure of diversification and downside protection,” he said.

Volatility has slumped to record lows in major currencies this year, making a tricky backdrop for big, swashbuckling bets. Still, Mr Lancioni said that even in an environment where prices do not move much, it is possible to find pockets of relative value across major economies. Mr Lancioni said the “holy grail” of investing remained the quest for uncorrelated returns, meaning the outcome is not dependent on price moves in other asset classes.

Adrian Lee & Partners said it will concentrate its macro fund in three markets — global equities, global fixed income and currencies. www.businessday.ng

House Speaker Nancy Pelosi, centre, said the reworked USMCA agreement was ‘infinitely better’ than the one originally reached by President Donald Trump © AFP via Getty Images

Donald Trump and House Democrats reach deal on Nafta revamp Officials from US, Canada and Mexico expected to meet later to sign off on proposed amendments JAMES POLITI

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ancy Pelosi, the Democratic Speaker of the House of Representatives, has reached a deal with US president Donald Trump to allow ratification of USMCA — the trade pact replacing Nafta whose fate in Congress had been uncertain until this week.

Ms Pelosi’s announcement on Tuesday followed months of wrangling with Robert Lighthizer, the US trade representative, and parallel talks with officials in Canada and Mexico to secure changes to the original text.

“It’s a victory for America’s workers, it’s one that we take great pride in advancing,” Ms Pelosi said, flanked by Richard Neal, the chairman of the House ways and means committee who led the talks on the Democratic side. She said the outcome was “infinitely better” than the original deal reached

by Mr Trump.

Congressional ratification of USMCA has been among the highest legislative priorities for Mr Trump, although its prospects were uncertain until this week. The move towards a green light on Capitol Hill will be touted as a big win for the White House heading into the 2020 presidential campaign, and evidence that Mr Trump’s disruptive approach to trade is delivering results at a time of heightened commercial tensions with China and the EU. “America’s great USMCA Trade Bill is looking good. It

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will be the best and most important trade deal ever made by the USA. Good for everybody — Farmers, Manufacturers, Energy, Unions — tremendous support. Importantly, we will finally end our Country’s worst Trade Deal, Nafta!” Mr Trump wrote in a tweet on Tuesday.

Mr Lighthizer was due to join Chrystia Freeland, Canada’s deputy prime minister, and Jesús Seade, Mexico’s USMCA negotiator, in the Mexican capital later on Tuesday to sign off on the proposed amendments.

Democrats successfully pushed for tighter labour standards, strengthened environmental protections and the removal of advantages for pharmaceutical companies in exchange for allowing a vote on USMCA in Congress. Ms Pelosi was able to extract enough concessions from Mr Trump for the deal to be endorsed by the AFL-CIO, the largest trade union federation. The union is highly influential in Democratic politics and has traditionally opposed trade deals.

“The USMCA is far from perfect . . . but there is no denying that the trade rules in America will now be fairer because of our hard work and perseverance,” said Richard Trumka, the AFL-CIO’s president.

“Working people have created a new standard for future trade negotiations,” he said.

Ms Pelosi had been facing intense pressure to allow USMCA to go forward from moderate Democrats representing swing districts, as they feel increasingly politically vulnerable due @Businessdayng

to the impeachment proceedings their party has launched against Mr Trump.

“This agreement would provide certainty for farmers and producers by ending the threat of back and forth retaliatory tariffs that this administration has pursued,” Cindy Axne, an Iowa Democrat, said in a statement. “I am thankful that [Mr Neal and Mr Lighthizer] worked in good faith and negotiated a better deal for all Americans, and did so before the year end.”

The revised pact still needs to be voted on in the House and the Senate before it becomes law. Passage appears guaranteed given its widespread support.

Business groups were largely pleased with the agreement, which mostly replicates the structure of open trade across North America that was enshrined in Nafta. Some of its measures expand commerce in areas such as digital trade, while others restrict it, such as new rules of origin for car manufacturing.

Most importantly, it removes the threat that Mr Trump could withdraw the US from the exiting Nafta trade agreement, which had been hanging over North American business and its integrated supply chains ever since he took office in 2017.

“A ratified USMCA will deliver increased certainty for manufacturers — especially for the 2 million manufacturing workers whose jobs depend on North American trade,” said Jay Timmons, the chief executive of the National Association of Manufacturers.

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POLITICS & POLICY Why I want Electoral Act amended – Omo-Agege Iniobong Iwok

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vie OmoAgege, deputy Senate President, has said that his decision to introduce a bill for comprehensive amendment of the Electoral Act No. 6 of 2010 was to strengthen the nation’s democracy.

Omo-Agege stated this at the Nigeria Civil Society Situation Room Stakeholders Forum on Elections, organised by the coalition of more than 70 civil societies in Abuja.

The lawmaker said the bill, co-sponsored by Abubakar Kyari, the senator representing Borno North Senatorial District, was now making its way to public hearing, having scaled Second Reading with overwhelming bipartisan support in the Senate.

According to him, “it is a decisive response to a plethora of our Supreme Court’s decision inviting the National Assembly to make sensible amendments to the Electoral Act. And I believe it is responsible for us to take the apex court’s constructive guidance on issues that fundamentally affect our democracy.

“This apart, Section 153

of the Electoral Act, 2010, as amended, specifically and expressly empowers INEC to “issue regulations, guidelines, or manuals for the purpose of giving effects to the provisions of this Act and for its administration thereof.

“The pervasive non-compliance with the Guidelines, Regulations and Manuals, would carry clear consequences for people who think violating electoral due pro-

cess is a rewarding exercise,” he said.

The Delta-born Senator said the amendment of the Electoral Act would afford INEC modern technologies into the electoral process, particularly accreditation of voters.

Omo-Agege said that the bill would also mandate INEC to publish the Voters’ Register for public scrutiny at every Registration Area

Yahaya Bello, Kogi State governor (signing documents), at the state headquarters of the Independent National Electoral Commission (INEC), Lokoja, to receive the Certificate-of-Return for the November 16, 2019 gubernatorial election.

ICPC urges Benue indigenes to join fight against corruption BENJAMIN AGESAN, Makurdi

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olaji Owasanoye, the executive chairman, Independent Corrupt Practices and other Related Offences Commission (ICPC) in Benue State has called on people of the state to join hands with the commission to help fight against corruption which he described as common enemy of the country.

The ICPC chairman made this call on Tuesday while celebrating the 2019 annual United Nations International Anti-corruption Day at the state command in Makurdi, the state capital.

Bolaji, who defined corruption as abuse of entrusted position for personal benefits or exploitation of a system for securing an unmerited advantage, disclosed that the theme of this year’s annual celebration was ‘United Against Corruption’, said that corruption manifests in so many forms, both in the

and on its website, at least seven days before a general election.

He stressed that it also mandates INEC to suspend an election in order to allow a political party that losses its candidate before or during an election to conduct a fresh primary to elect a replacement or new candidate.

He said the bill would grant agents of political parties the right to inspect original elec-

public and private, formal and informal sectors of the economy.

He said the battle against corruption was currently raging and that it was the people’s belief that it is not the sole responsibility of the ICPC or government alone but collective responsibility of everyone as citizens of the country.

“As we explore the option of collaboration and co-operation in the fight against corruption, we shall intensify activities to detect and investigate acts of corruption, embezzlement of public funds and abuse of office”, he emphasised.

He reiterated that the ICPC was vested with the responsibility of receiving and investigating reports of corruption with a view to prosecuting offenders where necessary, studying and reviewing corruptionprone procedures and system in government establishments with a view to eliminating or minimising Corruption. www.businessday.ng

toral materials before the commencement of election, define over-voting to include situations where “total votes cast also exceed total number of accredited vote The lawmaker said it also provides greater clarity and transparency in the process of reaching the final announcement of election results, starting with sorting of ballots, counting of votes among others.

However, reacting to the amendment in an interview with BusinessDay, Tuesday, some political stakeholders, said any amendment to the Electoral Act must empower the INEC to use electronic voting in the conduct of elections while the sequence of elections must be change.

National chairman of the Action Democratic Party (ADP) Sanni Yabagi, said INEC must devise other method of conducting elections in the country, stressing that the present manual system has failed the country.

Yabagi also said such amendment must accommodate the conduct of lower elections first before the presidential election, stressing that Nigerians are often distracted.

“Well, our party has always

canvassed for such amendment but, it must be done right, is good is coming from the top senate leadership, it did not originate from the PDP Senator.

“I think there is no doubt that our electoral system needs amendment and surgical operation. But if you ask me, I think there must be changes to allow for electronic voting,” he said.

“INEC should start by conducting the lowest elections first before the presidential election. You can see that Nigerians are often distracted and would refuse to vote after the outcome of that election,” Yabagi further said.

The national chairman of the Alliance for New Nigeria (ANN), Emmanuel Dania praised the move by the lawmaker, but warned that electronics voting must be introduced, adding that it was critical to the survival of the nation’s democracy and must be adopted.

“I think the amendment has become inevitable at this point; we should commend them, but electronic voting is very important; look at what happened in Kogi and Bayelsa States in the recent elections; it shows that our democracy is in great danger if we don’t act fast,” he said.

2020 guber race: Obaseki will get APC ticket - Party chieftain IDRIS UMAR MOMOH, Benin

“ICPC is determined to make anti-corruption crusade affect governance and well-being of the generality of Nigerians,” he stated.

He assured people of the state and Nigeria at large that the fight against corruption could succeed if fought at all levels and only when Nigerians cease to pay lip service to the fight against corruption and change their corrupt ways of doing things and effectively embrace integrity, transparency and accountability as the way of life.

The Benue state ICPC boss also urged all Nigerians, institutions, corporate bodies, security and anticorruption agencies to use its mandate to build a better nation.

“It is therefore, my strong belief that this commemoration will provide the platform for the exchange of robust ideas that would aid in enhancing the fight against Corruption for the development of the country,” he added.

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harles Idahosa, a chieftain of the All Progressives Congress (APC) in Edo State, has said that Governor Godwin Obaseki would get the party’s ticket whether through direct primaries or indirect primaries.

Idahosa, who made the remarks at a press conference in Benin City, noted that it was the constitutional duty of the state chapter to decide what pattern it will use in conducting its primaries.

The former aide to National Chairman of the party Adams Oshiomhole while he was the governor of the state lamented that the party was losing its grip due to the alleged overbearing attitude of the national chairman.

He however, called for his resignation as the national chairman of the party for the interest and survival of the party.

“I called on the national chairman of the party and immediate past governor of the state, Adams Oshiomhole to quietly tender his resignation letter as the national chairman for the interest and survival of the party. The

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party is losing its grip due to the alleged overbearing attitude of the national chairman of the party.

“The national chairman of the party has no political home base and that he has been suspended by his ward, Local Government Area and by the state chapter of the party and that the only way out for him is to tender his resignation letter as he lacks the political acumen to lead the party but can best function as a labour leader,” Idahosa said.

“From the way we have seen issues, under Oshiomhole, APC is dying gradually and there is no way somebody like me can see issues and pretend not to see them,” he said.

He also accused the national chairman of being the brain behind the fourteen members of the House of Assembly not resuming sitting as duly elected members of the house, thereby denying the people of their rights.

He also took a sw ipe on those claiming to have formed the party in the state, noting that they were only arrogating to themselves what they are not According to him, I hap@Businessdayng

pened to have been among the five Nigerians that have formed the Action Congress for Democrat (ACD) that is today APC. “In 2006, after we formed the ACD in 2004, gentlemen of the press you can look at all these; Igbinedion disowned ACD; in fact, I was the one that was being disowned because in 2006 they saw me at a meeting, of the ACD now APC. “There was this insinuation that Igbinedion as then governor and Tunubu were the ones sponsoring the ACD that is now APC. While Tinubu kept quiet, he did not bother to deny Lai Muhammed; the Edo State government at that time quickly disowned me but it is very interesting today that everybody is now claiming APC,” he said.

“That is one of the reasons I cannot keep quiet. I am a founding father, I see people just coming into the party to destroy it.

“Adams Oshiomhole as at that time was still carrying placards on the streets of Lagos and Abuja, protesting as a labour leader. That was when we formed this party.

We knew the roles he played that time”, he said.

56

Wednesday 11 December 2019

BUSINESS DAY

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Wednesday 11 December 2019

BUSINESS DAY

57

Live @ The STOCK Exchanges Prices for Securities Traded as of Tuesday 10 December 2019 Company

Market cap(nm)

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Change

Trades

Volume

Company

Market cap(nm)

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PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 327,016.08 9.20 0.55 264 21,002,935 UNITED BANK FOR AFRICA PLC 222,296.24 6.50 0.77 217 8,207,165 ZENITH BANK PLC 582,404.96 18.55 0.27 310 11,231,579 791 40,441,679 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 226,140.34 6.30 -1.56 226 4,530,138 226 4,530,138 1,017 44,971,817 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,361,123.51 116.00 -1.69 102 529,302 102 529,302 102 529,302 BUILDING MATERIALS DANGOTE CEMENT PLC 2,385,671.04 140.00 -1.41 119 2,186,779 LAFARGE AFRICA PLC. 219,066.02 13.60 -0.74 79 1,185,262 198 3,372,041 198 3,372,041 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 323,467.98 549.70 - 21 90,171 21 90,171 21 90,171 1,338 48,963,331 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 85.50 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 0 0 UPDC REAL ESTATE INVESTMENT TRUST 11,873.80 4.45 - 3 5,426 3 5,426 3 5,426 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 3 5,426 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 1 5,500,000 OKOMU OIL PALM PLC. 51,988.10 54.50 - 12 20,414 PRESCO PLC 37,850.00 37.85 - 7 7,020 20 5,527,434 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,520.00 4.26 - 1 500 1 500 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,530.00 0.51 - 5 268,178 5 268,178 26 5,796,112 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 953.02 0.36 - 1 538 JOHN HOLT PLC. 217.92 0.56 - 0 0 S C O A NIG. PLC. 1,903.99 2.93 - 0 0 TRANSNATIONAL CORPORATION OF NIGERIA PLC 40,241.51 0.99 -1.01 66 14,149,890 U A C N PLC. 23,194.44 8.05 - 107 7,991,404 174 22,141,832 174 22,141,832 BUILDING CONSTRUCTION ARBICO PLC. 577.67 3.89 -9.95 1 100,000 1 100,000 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 25,080.00 19.00 - 10 27,420 ROADS NIG PLC. 165.00 6.60 - 0 0 10 27,420 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,598.40 1.00 - 6 16,662 6 16,662 17 144,082 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 7,281.43 0.93 - 0 0 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 63,521.10 29.00 - 22 59,138 INTERNATIONAL BREWERIES PLC. 86,818.21 10.10 - 7 31,936 NIGERIAN BREW. PLC. 409,841.23 51.25 0.10 52 5,405,766 81 5,496,840 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 180,000.00 15.00 - 105 5,321,263 FLOUR MILLS NIG. PLC. 77,907.21 19.00 - 81 796,877 HONEYWELL FLOUR MILL PLC 7,850.90 0.99 -1.00 13 420,760 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 0 0 NASCON ALLIED INDUSTRIES PLC 37,092.14 14.00 - 6 27,530 UNION DICON SALT PLC. 3,321.07 12.15 - 0 0 205 6,566,430 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 16,997.73 9.05 - 39 225,983 NESTLE NIGERIA PLC. 1,030,453.13 1,300.00 -3.70 78 480,145 117 706,128 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 4,878.29 3.90 - 22 401,497 22 401,497 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 19,852.39 5.00 - 31 256,584 UNILEVER NIGERIA PLC. 106,282.60 18.50 -2.12 26 357,158 57 613,742 482 13,784,637 BANKING ECOBANK TRANSNATIONAL INCORPORATED 119,272.08 6.50 - 65 854,121 FIDELITY BANK PLC 57,949.59 2.00 -1.96 79 8,047,411 GUARANTY TRUST BANK PLC. 843,203.28 28.65 -1.21 215 49,224,807 JAIZ BANK PLC 19,151.76 0.65 1.54 41 4,142,225 STERLING BANK PLC. 55,277.60 1.92 -3.03 17 553,300 UNION BANK NIG.PLC. 192,196.97 6.60 -5.71 33 799,386 UNITY BANK PLC 8,182.54 0.70 - 7 36,710 WEMA BANK PLC. 25,844.89 0.67 -4.29 37 10,666,798 494 74,324,758 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 4,989.75 0.72 -1.39 16 677,926 AXAMANSARD INSURANCE PLC 18,900.00 1.80 - 4 28,000 CONSOLIDATED HALLMARK INSURANCE PLC 3,008.10 0.37 -5.13 1 300,000 CONTINENTAL REINSURANCE PLC 22,820.04 2.20 - 0 0 CORNERSTONE INSURANCE PLC 9,132.29 0.62 -8.82 8 651,927 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 1,904.09 0.26 - 4 64,500 LAW UNION AND ROCK INS. PLC. 2,362.98 0.55 7.27 13 2,839,500 LINKAGE ASSURANCE PLC 4,080.00 0.51 - 1 10,000 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 1 35,000 NEM INSURANCE PLC 10,561.01 2.00 - 13 235,170 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,745.10 0.51 - 0 0 REGENCY ASSURANCE PLC 1,333.75 0.20 - 0 0 SOVEREIGN TRUST INSURANCE PLC 1,668.16 0.20 - 0 0 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 0 0 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 1 10,000 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 1 100,000 WAPIC INSURANCE PLC 4,683.96 0.35 -2.78 24 2,959,614 87 7,911,637 MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,629.63 1.15 - 2 23,408 2 23,408

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MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,200.00 1.00 - 0 0 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,796.93 1.39 - 0 0 RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 8,200.00 4.10 -2.38 30 624,719 CUSTODIAN INVESTMENT PLC 35,291.19 6.00 - 9 209,629 DEAP CAPITAL MANAGEMENT & TRUST PLC 600.00 0.40 - 0 0 36,436.99 1.84 3.95 63 6,729,212 FCMB GROUP PLC. ROYAL EXCHANGE PLC. 1,492.16 0.29 7.41 4 1,016,942 STANBIC IBTC HOLDINGS PLC 385,423.03 36.80 - 16 131,495 UNITED CAPITAL PLC 13,380.00 2.23 2.29 45 1,400,603 167 10,112,600 750 92,372,403 HEALTHCARE PROVIDERS EKOCORP PLC. 2,069.19 4.15 3.75 2 118,511 852.75 0.24 -7.69 1 150,000 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 3 268,511 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 494.58 0.50 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 6,467.72 3.10 -8.82 11 197,100 FIDSON HEALTHCARE PLC GLAXO SMITHKLINE CONSUMER NIG. PLC. 6,936.08 5.80 1.75 18 1,111,516 MAY & BAKER NIGERIA PLC. 3,692.00 2.14 - 3 5,062 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 1,386.38 0.73 - 1 7,000 NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 325.23 1.50 - 0 0 PHARMA-DEKO PLC. 33 1,320,678 36 1,589,189 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 816.96 0.23 -8.00 9 2,504,000 9 2,504,000 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 486.00 4.50 - 0 0 TRIPPLE GEE AND COMPANY PLC. 316.77 0.64 - 0 0 0 0 PROCESSING SYSTEMS CHAMS PLC 1,737.54 0.37 - 8 162,465 E-TRANZACT INTERNATIONAL PLC 10,962.00 2.61 - 0 0 8 162,465 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,123,311.48 298.90 - 3 2,090 3 2,090 20 2,668,555 BUILDING MATERIALS BERGER PAINTS PLC 1,956.31 6.75 - 9 18,760 CAP PLC 16,800.00 24.00 - 5 59,662 CEMENT CO. OF NORTH.NIG. PLC 247,097.82 18.80 - 24 59,283 MEYER PLC. 286.87 0.54 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 2.23 - 0 0 PREMIER PAINTS PLC. 1,156.20 9.40 - 3 103,129 41 240,834 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 2,624.37 1.49 - 3 7,875 3 7,875 PACKAGING/CONTAINERS BETA GLASS PLC. 26,898.49 53.80 - 1 155 GREIF NIGERIA PLC 388.02 9.10 - 0 0 1 155 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 45 248,864 CHEMICALS B.O.C. GASES PLC. 2,539.09 6.10 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 83.60 0.38 - 2 200,000 2 200,000 2 200,000 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 9 423,387 9 423,387 INTEGRATED OIL AND GAS SERVICES OANDO PLC 44,753.08 3.60 - 62 3,583,178 62 3,583,178 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 53,332.04 147.90 - 23 77,308 CONOIL PLC 12,838.11 18.50 - 12 8,667 ETERNA PLC. 3,912.43 3.00 - 18 177,548 FORTE OIL PLC. 23,574.91 18.10 - 24 65,478 MRS OIL NIGERIA PLC. 4,663.23 15.30 - 4 16,400 TOTAL NIGERIA PLC. 37,652.97 110.90 - 29 34,102 110 379,503 181 4,386,068 ADVERTISING AFROMEDIA PLC 1,509.28 0.34 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 15,796.05 1.62 - 1 8,500 1 8,500 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 247.03 0.21 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,623.26 4.45 - 5 30,780 TRANS-NATIONWIDE EXPRESS PLC. 464.16 0.99 - 0 0 5 30,780 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,259.15 2.75 - 0 0 IKEJA HOTEL PLC 2,120.37 1.02 - 2 50,879 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 41,042.18 5.40 - 0 0 2 50,879 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,320.00 0.36 -10.00 2 200,010 2 200,010 PRINTING/PUBLISHING ACADEMY PRESS PLC. 223.78 0.37 - 0 0 LEARN AFRICA PLC 964.31 1.25 - 1 1,770 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 578.09 1.34 -0.74 18 1,470,300 19 1,472,070 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 729.39 0.44 -2.22 8 560,000 8 560,000 SPECIALTY INTERLINKED TECHNOLOGIES PLC 757.44 3.20 - 0 0 SECURE ELECTRONIC TECHNOLOGY PLC 1,126.31 0.20 - 0 0

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BUSINESS DAY Wednesday 11 December 2019 www.businessday.ng

What does the Aramco IPO tell us about Saudi reforms?

Having struggled to win foreign backing for the $25.6bn listing, the crown prince’s plans face further scrutiny Andrew England, Simeon Kerr and Anjli Raval

T

he excitement was palpable as bankers, one group at a time, stepped on to buses that shuttled them from Riyadh’s Ritz-Carlton hotel to a meeting with Saudi officials.

Saudi Arabia, the most conservative of nations, had promised to do what no other Gulf state had dared: open the books of its state oil company Saudi Aramco, let the world peer inside and ultimately take a stake in the kingdom’s crown jewel.

When the bankers arrived, they were greeted by Prince Mohammed bin Salman, then the deputy crown prince, and his “A-team” sitting around the “biggest table I’ve ever seen”, says one executive who attended the December 2016 meeting. The bankers were pitching for business from what was touted as the world’s largest initial public offering, with Riyadh seeking a valuation of $2tn and considering a global listing of 5 per cent of shares to raise $100bn.

“It was euphoric,” says the executive. “Some people were sceptical, but I would say, ‘What?

Focus on the positives’. They were finally prepared to do it and bring socio-economic change [to the country].”

Three turbulent years later, Riyadh can lay claim to the world’s largest IPO. But it is on a far smaller scale than it had originally suggested. Saudi Aramco is to list 1.5 per cent of its shares on the local stock exchange on Wednesday, raising at least $25.6bn with minimal participation from foreign institutions that balked at even the scaled back valuation of $1.7tn.

In the kingdom, it is being hailed as a milestone for the world’s top crude exporter — proof that Prince Mohammed, elevated to crown prince in 2017, is forging ahead with his pledge to overhaul the oil-addicted economy and modernise his nation. But for many of the jaded financiers whose lives have been consumed by the on-off process since 2017, the mood is one of deflation — dazed by the downsizing and the realisation that the fees they dreamt of may never materialise.

“They aren’t doing what they were aiming to do, which is bring in foreign capital,” says a senior banker, who like most of those interviewed, asked not to be identified. “It’s not a real deal, it’s political.”

The story of the listing is a metaphor for the rollercoaster journey Saudi Arabia has been on as Prince Mohammed consolidated power and shook up the kingdom on a scale not witnessed since his grandfa-

ther, Abdulaziz, founded the modern state 87 years ago. It is a tale that began with audacious announcements and lofty ambitions that generated huge expectation but also scepticism.

Now as the first phase of Prince Mohammed’s “Vision 2030” reform plan edges towards its close, it has become one of missed economic targets and shifting goalposts set against the paradox of unprecedented social reforms and increasing autocracy.

It is a combination that has fuelled contrasting narratives between optimists, resolutely supportive of the crown prince, and pessimists who fear his brash and aggressive leadership is doing more harm than good.

“Right aspirations, wrong approach,” says an executive familiar with the royal court.

“When you are trying to do too much, you end up doing nothing much. There’s a hundred things that have to go up to his highness; it creates an environment of overwork and gridlock.”

The lack of economic progress helps explain why Prince Mohammed was so keen to complete the Saudi Aramco listing this year — the need for a win.

“Before the IPO, there was some disillusionment that none of the big projects have yielded anything and the economy is doing badly. People were asking, ‘What has happened to Vision 2030?’” says a foreign executive with Saudi clients. “With the IPO, they can say they have done something they said they were going to do.”

There has been some progress. Prince Mohammed has ushered in social reforms few believed they would see. A ban on women driving has been lifted; cinemas have opened; rules that prevented women travelling abroad without the consent of male guardians have been eased; and the once-feared religious police have been muzzled.

New laws on bankruptcy, foreign ownership and mortgages have been signed off.

Riyadh took the politically

sensitive decision to slash energy and fuel subsidies to ease the fiscal burden. And when Saudi Aramco provided intimate details to investors on a roadshow to market its debut bond this year, it was seen as “an amazing period” in a region where disclosure has been anathema, says a veteran Gulf banker.

But, for many, the positives have been drowned out by negatives, including the shocking murder of Jamal Khashoggi, whose dismembered body has not been recovered a year after his killing.

Many Saudi businesses were already reeling from an anticorruption operation conducted 11 months before the journalist’s murder in Istanbul in October 2018. That purge saw more than 300 princes and tycoons locked up in the Ritz-Carlton — the same hotel the excited bankers had stayed in 11 months earlier — shattering the fragile confidence of a business community already buckling under the weight of austerity measures and the state’s failure to pay bills.

Separate crackdowns targeting bloggers, female activists, journalists, clerics and academics have reinforced the belief that Riyadh has become more repressive under Prince Mohammed. His actions have quashed debate, whether it is about the merits of the IPO or the pace of reform and highlighted the risks of investing in the kingdom.

Crucially, the flood of foreign direct investment Prince Mohammed was betting on to support his plans has yet to materialise. Instead it fell to $1.4bn in 2017. And even though it picked up to $3.2bn last year, according to UN data, that is less than half the FDI secured in 2016.

Meanwhile, outward investment trebled between 2017 and 2018 to $21.2bn, a reflection of spending by state entities, notably the Public Investment Fund, the sovereign wealth fund, as well as private investors shifting money offshore.

“He could have used the energy of hope instead of the energy of fear . . .

and not just been surrounded by yes men. The Saudi private sector could mobilise $200bn to $300bn — the shortage is not capital, it’s trust,” says the executive familiar with the royal court.

Repeating Saudi businessmen’s concerns, he adds: “‘We saw our friends go to the Ritz, we saw our bills not being paid [by the government] and now they say we should come and invest?’”

Saudi officials acknowledge mistakes. But there is also frustration that Prince Mohammed is not, in their view, given sufficient credit for taking on an unsustainable economic system built on petrodollars and patronage.

“There’s no question we’ve had a tough time getting to where we are and it’s been more difficult than we would have hoped,” says a senior Saudi official. But he adds, “You can’t underplay what we’ve managed to achieve. We are going through an evolution and everyone is judging us while it’s happening.”

It was, however, Prince Mohammed who set such high goals just at the moment when the oil-rich region was grappling with a prolonged fall in crude prices that turned abundant surpluses into yawning deficits. The crown prince was clear about his prime objectives: reining in the domineering role of the state and creating private sector jobs for the youthful population.

A National Transformation Plan, unveiled in 2016, was to cut unemployment from 11.6 per cent to 9 per cent, create more than 450,000 private sector jobs and increase non-oil revenues, while also lowering public sector wages from 45 per cent to 40 per cent of total government spending — all by 2020. But it became clear that many goals were unrealistic and the next year Riyadh revised the NTP, with targets removed or pushed out by five to 10 years.

It was an early sign of the magnitude of the task. Today, many of the metrics paint a very different picture and the state’s role is as dominant as ever. Unemploy-

ment sits at 12.2 per cent, after surging to a record high of 12.9 per cent last year. The public sector wage bill has increased to 50 per cent of expenditure, while the budget deficit is expected to widen to $50bn next year — almost twice the proceeds of the Saudi Aramco IPO. The government has boosted non-oil revenue by introducing value added tax and tariffs on foreign workers, who dominate the private sector.

But the latter move has been debilitating for businesses dependent on cheaper foreign labour. The cuts to energy subsidies were welcomed by economists but have added to companies’ costs and damped demand.

The IMF has downgraded its forecast for growth in gross domestic product this year to 0.2 per cent because of lower oil prices and cuts to production, even as there is a pick-up in nonoil activity.

One success officials point to is the visible increase in women working, particularly in shopping malls as the government has pushed retailers to hire Saudis. Yet, there has been little movement in the goal of raising the number of women in the labour force from 23 per cent to 28 per cent by next year.

“We rushed into quite a lot early on,” says the Saudi official.

“We had energy, we had success, we had confidence, and everything was going really well.

But then you start saying, ‘Let’s shift here, let’s do this here’. [And then] there is a bandwidth issue.

Do we have enough people to manage this process? No, but we’re still going to give it a shot.”

Other factors created “blind spots”, says the executive familiar with the royal court. “Prince Mohammed’s mistake was that every time someone like Larry Fink [BlackRock’s chairman and chief executive] visited, he believed the Kool-Aid and that they were ready to pour hundreds of billions of dollars in, when in reality they just wanted a piece of the action,” he says.

•Continues online at www.businessday.ng

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