BusinessDay 12 Jul 2018

businessday market monitor Commodities

NSE

Brent Oil

Biggest Gainer

$74.98

MOBIL N180.50

Cocoa

US $2,480.00

Bitcoin Biggest Loser

9.39pc

JBERGER N38.35

37,253.25

-6.46pc

₦2,232,662.39

FMDQ Close

Everdon Bureau De Change Buy

-1.71pc

Powered by

news you can trust I **THURSDAY 12 JULY 2018 I vol. 15, no 95 I N300

Sell

$-N 358.00 361.00 £-N 474.00 482.00 €-N 411.00 419.00

@

Foreign Exchange Market

Spot $/N

I&E FX Window 361.87 CBN Official Rate 305.75

fgn bonds

Treasury Bills 3M 0.10 11.83

6M

5 Years

10 Years

20 Years

-0.24 12.81

0.00% 13.75%

0.00% 14.06%

-0.06% 14.16%

g

Lagos overtakes Ogun in new manufacturing investments ODINAKA ANUDU

L

agos State has overtaken its closest rival, Ogun, in real sector investments a s m a n u f a c t u re r s preferred to set up new plants and expand frontiers in Nigeria’s economic capital in 2017.

Between 2014 and 2016, more than 70 percent of investments in agro processing, heavy and light manufacturing went to Ogun, while Lagos,

for first time in 4 years poor infrastructure seen as main factor

which is mainly made up of Ikeja and Apapa industrial zones, often attracted less than 20 percent of the total, according to data from the Manufacturers Association of Nigeria (MAN).

But the trend changed in 2017 as the most recent data

show that Ogun state received only 28.59 percent of all the investments last year, whereas Lagos got 50.11 percent of total investments that year.

Ma nu f a c tu re r s p o i nt t o poor infrastructure in some industrial clusters as a major reason why they cut back in-

vestments in Ogun. Agbara—a major industrial cluster hosting large enterprises such as Unilever, Nestle, Pharma Deko, GlaxoSmithKline (GSK), Evans Medical Plc and Beta Glass, among others—has bad Continues on page 38

Lunch with the FT

Aliko Dangote, Africa’s richest man, on his ‘crazy’ $12bn project DAVID PILLING

A

s a rule, I don’t get worked up over oil refineries. But the one gradually taking form on 2,500 hectares of swampland outside Lagos, Nigeria’s Mad Max commercial capital, is so big, so audacious and so

Continues on page 38

NLNG signs engineering contract for Train 7 construction

L-R: Stanley Otokpa, vice president, business development, Amazon Energy; Yinka Oluwatimehin, GCEO, Amazon Energy; Ibe Kachikwu, minister of state for petroleum; Maikanti Baru, GMD, NNPC; Mohammed Barkindo, secretary-general, OPEC, and Bolade Adebukunola, vice president, sustainability and corporate services, Amazon Energy, at the just concluded NOG 2018.

Ekiti race heats up as Fayose faints, hospitalised after police assault RAPHAEL ADEYANJU, Ado Ekiti

G

overnor Ayodele Fayose of Ekiti state has accused the Police of assault. The governor was allegedly beaten, tear gassed and dragged on the floor by security men who had occupied the gates of the governor’s office since Tuesday when President Mohammadu Buhari came to the state for a mega rally of the All Progressive Congress (APC).

The governor who was bandaged on the neck and hands, managed to speak with teeming supporters who massed to the governor’s office to sympathize with him.

The governor suddenly fainted

… PDP alleges plan to eliminate governor … Police to withdraw Fayose, Fayemi’s security aides after briefly addressing the people and that further angered them as they cursed and rained verbal invectives on the opposition and candidate of the All Progressive Congress (APC), Kayode Fayemi.

Trouble reportedly started when Fayose, leading thousands of supporters in a victory walk he had announced to hold in Ado Ekiti some days ago, approached some stern looking armed policemen to demand why they were preventing people to mass

at the campaign venue in Fajuyi pavilion. Responding, security men allegedly teargassed him and many others, and shot sporadically in the air.

Fayose said: “I was slapped by a policeman who kicked me and shouted at me, but I want you to be strong and be of great courage do not be discouraged, this battle must be won. They have come to occupy our land, this is not our democracy. I call on the international communities and relevant

agencies, Ekiti is under siege. How can l be a governor of Ekiti state and be manhandled like this?

“I will go back to the hospital and rest. Be resolute stand with PDP and Eleka. I am having a lot of pains but I prefer to bear this pain because of you.” Fayose was later rushed to the intensive care unit of the state hospital after he fainted.

The State Police Public Relations Officer, (PPRO), said he would send his reaction very soon

Continues on page 38

…seeks $7bn loan for expansion FRANK UZUEGBUNAM & ISAAC ANYAOGU

I

n the build-up towards Train 7 Final Investment Decision (FID) later this year, the Nigeria LNG Limited (NLNG) is seeking about Continues on page 38

Inside

Digital economy to generate $88bn in 3yrs P. A1 World Cup Result Croatia 2 - England 1

2 BUSINESS DAY NEWS Oil companies ramp up drilling in pre-existing fields as new investments dry up ISAAC ANYAOGU & OLALEKAN IPELE

N

igerian oil exploration companies are returning to pre-existing fields to drill for more oil as investments into new wells become too few and far between in a sector where investors are betting on short-term cash rather than investing for later growth.

Shoreline group, an independent Nigerian producer is the latest Nigerian company returning to existing fields in a new drilling campaign aimed to increase production by 70,000 barrels per day (bpd) by the end of the year.

“We have reserves, it’s just drilling and processing and that’s what we’re doing and putting in place,” Kola Karim, Shoreline Chief Executive Officer told Bloomberg.

On July 1, the Nigerian National Petroleum Corporation (NNPC)/ First E&P JV and Schlumberger will return to the Anyalu and Madu fields under Oil Mining Licence, OML 83 and OML 85, offshore Nigeria to find more oil.

Under the agreement, global oil services giant, Schlumberger would provide $724.14m out of the required project cost of $1.082bn while the balance of $358.79m is to be funded with cash flows generated by the project.

The Anyala and Madu fields are projected to have 193 million barrels of crude oil and 0.637 trillion cubic feet of proven gas reserves with production plateau of 50, 000 barrels of oil per day and 120

million standard cubic feet of gas per day.

Analysts say more of these kinds of deals will happen in an environment where regulatory uncertainty and the cost of new fields make old ones attractive.

“For these oil companies, thinking behind this is survival, there’s a lot of uncertainty in the market, you can’t come into a market that is so uncertain that start to do a new development, you can’t survive it because you don’t know what the regulatory regime will be,” said Chuks Nwani an, energy lawyer.

Ayodele Oni, partner at Bloomfield oil firm and energy lawyer says “It is cheaper and many of these ones, the fiscal term is the petroleum profit tax act which they already know, many of these new developments might be under the PIGB, so no one is sure of what the fiscal terms will be so no one wants to commit money.”

Nigeria has passed a governance aspect of the Petroleum Industry Bill which was broken down into four components, but the fiscal aspect which is the most important for guiding decisions on financial investments remain stuck in the national assembly over disagreements with terms.

The absence of investments into new fields have seen Nigeria’s oil reserves stagnate at 36.18 billion barrels, as at the first quarter of 2018, according to Ibe Kachikwu, minister of state for Petroleum Resources, at the recent Nigeria Oil and Gas (NOG) conference in Abuja.

C002D5556

Thursday 12 July 2018

OPEC oil production up 173,000bpd in June as output jumps DIPO OLADEHINDE

T

he latest monthly report released yesterday by the Organisation of Petroleum Exporting Countries (OPEC) reveals several oil producers led by Saudi Arabia pumped more crude oil in June despite agreeing to start raising output beginning July as collective oil production for the cartel rose by 173,000 barrels per day (bpd) to 32.3 million barrels Day (mbd).

After a very contentious meeting last month over crude oil prices and falling production in Venezuela and imminent U.S. sanctions on Iran, the world’s fifth-biggest oil producer; OPEC key player Saudi Arabia increased output by 405,000bpd to 10.5 million bpd in June.

Although Baghdad initially conveyed cynicism over increasing output ; Iraq recorded the second biggest increase of 71,500 bpd to about 4.5 million bpd while United Arab Emirates (UAE) and

Kuwait raised output by 35,100 bpd and 27,300 bpd to 2.8 million and 2.7 million respectively.

Ayodele Oni, energy partner at Bloomfield Law Field said the increase in production output could be as a result of increase in supply

by OPEC members’ countries that were previously undersupplying as a result of production cut or under capacity.

“There are some countries in OPEC who have the capacity to produce more oil but as a result of the production cut they did not, however after the last OPEC meeting majority of them would have increased production which is what we are seeing now,” Oni told BusinessDay by Phone.

Nigeria, Africa largest oil producing country had a 27,300 bpd increase to 1.6 million bpd, while the cartel’s total production got a boost of 331,000 bpd from the Republic of Congo, which began reporting as OPEC’s 15th member this month.

Meanwhile, production declined in Angola as well as the

two more troubled nations Libya, which has recently seen a sharp drop in output due to political infighting, and Venezuela, where the nation is grinding to a halt due to the on-going economic collapse.

OPEC, along with Russia and several other producer nations, has been limiting output since January 2017 in order to drain a crude glut that sent oil prices to 12-year lows in 2016.

Brent the benchmark for Nigeria crude oil was off 1.7 percent at $77.55 per barrel on Wednesday, as President Trump threatened to impose tariffs on $200 billion in Chinese goods and as Libya resumed oil exports. U.S. crude fell 0.6 percent to $73.65.

Also in the report, OPEC said it sees global oil demand surpassing 100 million barrels per day for the first time next year, but the group warned that trade tensions could weigh on demand.

Continues on wwwbusinessday online.com

NB to issue N8bn commercial papers OLALEKAN IPELE & MICHEAL ANI

N

The Nigerian economy suffered a severe slowdown through 2016 and much of 2017, owing to sustained low global crude oil prices. This led to heightened economic uncertainty, which was worsened by the devaluation of the Naira.

However, the economy appears to have rebounded from recession, as the real Gross Domestic Products (GDP) growth rate registered at 0.8 percent in 2017, compared to a 1.5 percent decline in 2016.

The Brewing Industry is one of the major sectors within the Nigerian Food, Beverages and Tobacco division. The sector has witnessed various forms of transformation over the years, with the number of players spiking from less than five (5) in 1970 to over thirty (30) in 1980.

However, operational and economic challenges in the early 1980 led to the closure of some breweries.

Currently, there are over ten brewery companies, of which five (NB, Guinness, Champion Breweries, International Breweries and Golden Guinea Breweries) are listed on the NSE. NB and Guinness dominate the industry, controlling over 60 percent and 19 percent market share respectively, based on industry sources.

In line with the capital intensive nature of NB’s business, fixed assets have historically accounted for over 70 percent of total assets. These assets have primarily been funded through equity, whilst the high working capital requirement has been covered through various debt instruments and payables.

igerian Breweries Plc (NB), a subsidiary of Heineken N.V. Group, is set to launch a N8 billion Series 15 Commercial Paper (“CP’) with 91 days tenor, under its N100 billion CP programme inaugurated in 2015.

The offer is set to open today Thursday 12 July 2018, and close on Tuesday, 17 July.

The programme is expected to complement the company’s other sources of working capital, while diversifying funding sources to include non-bank investors. Additionally, the programme will improve the company’s ability to periodically access funding at rates mirroring the money market.

“They are using this launch which is the 15th series for expansion to finance working capital.

They have a big competitor in the likes of International Breweries who also are doing a lot of expansion,” said Dolapo Ashiru, a financial analyst.

NB in its 2017 financial statement reported a five-year compound annual growth rate (CAGR) of 6.4 percent in revenue, driven by business acquisitions, introduction of new products, and more recently, price inflation.

In the same period, increase in the cost of raw materials and consumables as well as down trading, amongst others pressured NB’s margins. Nonetheless, the Company posted a good operating profit margin of 15.9 percent, return on assets of 13.3 percent and return on Continues on wwwbusinessday online.com equity of 26.1 percent in 2017.

Joseph Makoju, GMD, Dangote Cement plc (2nd r); Chinyere Egwuonwu, director, Standard Development, Standard Organisation of Nigeria (r); Arvind Pathak, group chief operating officer, Dangote Cement (2nd l), and Ravi Sold, director of operations, Dangote Cement (l), at the partnership facility visit to the Dangote Cement plant, Obajana by the Standard Organisation of Nigeria (SON).

Oando, NAOC, Shell, others partner NNPC to unlock 3bcf of gas by 2020 PATRICK ATUANYA

O

ando PLC, Nigeria Agip Oil Company (NAOC), Shell Petroleum Development Company (SPDC), other indigenous and international oil companies in partnership with the Nigerian National Petroleum Corporation (NNPC) achieved a commendable feat with the signing of an agreement to implement Gas Projects worth $3.7 billion. The gas projects tagged ‘Seven Critical Gas Development Projects (7CGDP)’ is set to bridge the gas supply shortfall in the country.

The 7CGDP is an integral part of the gas development strategy designed by the NNPC to leverage the full potential of gas to meet the target of generating at least 15 gigawatts (GW) of electricity by 2020. The agreement includes the development of the 4.3 trillion cubic feet (TCF) Assa North/Ohaji South field, the development of the 6.4 TCF Unitized Gas fields (Samabri-Biseni, Akri-Oguta, UbieOshi and Afuo-Ogbainbri) and the development of 7 TCF Nigerian

Petroleum Development Corpora- impact country’s Gross Domestic tion’s (NPDC) OMLs 26, 30 and 42. Product (GDP).”

Speaking at the event, Ainojie The ‘Seven Critical Gas DevelIrune, the Chief Operating Officer, opment Projects’ are in line with Oando Energy Resources said; “The the Government’s efforts to harcompany’s focus was to ensure ness the country’s vast gas reserves that indigenous companies play to reposition Nigeria as a gas based an integral role in creating the economy and includes five projects new Nigeria; a Nigeria where as a by the NNPC joint venture and two result of our combined efforts we projects by the NPDC. The projare driving industrialisation, driv- ects will enable a boost of about ing the commercial use of gas, and 3.4billion standard cubic feet of ultimately creating and enhancing gas per day to bridge the projected value for the nation. The NAOC medium term supply gap.

Joint Venture (JV) of which Oando This is not Oando’s first foray is a part of will be responsible for into gas, through their midstream unlocking almost 50% of the 42 subsidiary Axxela, the company trillion cubic feet that the 7-Critical has recorded many firsts and sucGas Development Projects aims to cesses. Oando was the first private deliver by 2020. We all know that oil company to enter gas distribuis a key contributor to the economy, tion in Nigeria and pioneered gas but we must also understand the distribution in the Greater Lagos extremely important role that area with the aim of spurring gas has to play. When you have a industrialization. Other notable developing country like Nigeria, gas projects under the company’s gas plays a critical role in moving name include the development it from where it is today to a first of circa 260km gas pipeline grid world country. Diesel is currently across Nigeria, Alausa and Akute what most of our manufacturing Independent Power Plants and a companies use; the utilization of Compressed Natural Gas Plant. gas will lead to cost reduction and most importantly, it will directly Continues on wwwbusinessday online.com

Thursday 12 July 2018

C002D5556

BUSINESS DAY

3

4

BUSINESS DAY

C002D5556

Thursday 12 July 2018

Thursday 12 July 2018

C002D5556

BUSINESS DAY

5

6

BUSINESS DAY

C002D5556

Thursday 12 July 2018

NEWS

Analysts see activities rise in property market on election spending, budget discipline CHUKA UROKO

Viewpoint from Singapore-Temasek, the giant fund quietly powering Singapore’s economy

A

common name you hear when you ask some of the big companies we have visited about their ownership is “Temasek.’ Either Temasek directly owns a stake in the company or owns a company that owns a stake in the company.

Temasek is Singapore’s sovereign wealth fund. It was first incorporated in 1974 and its 100 percent owned by the Singapore government.

As at 31 March 2018, Temasek had a total net portfolio value of US$235 billion under management according to the company’s financial statement released on Wednesday. Temasek results shows that it made US$6.62 billion in dividend income for its financial year ended March 2018. The Fund’s net profit for the period stood at US$16 billion, which is more than half of Nigeria’s 2018 annual budget.

Temasek’s one year return to shareholders, and that is the Singapore government, stood at 12 percent, while the company annualised return since it was set up in 1974, 44 years ago, stands at 15 percent.

In the period between 2010 and 2018, Temasek’s total portfolio has more than doubled from US$133 billion in 2010 to its current value of US$235 billion. One-year total shareholder returns for Temasek in dollar terms stand at 20 percent. Temasek’s total new investments in 2018 was US$22 billion while divestments stood at US$12 billion.

To put this in context, remember Nigeria only set up its own sovereign wealth fund in 2011 after much foot dragging and resistance. Since its set up, total portfolio under management has remained under US$2 billion. Singapore, a country with a population of just five million people, with no known natural resources and about half the land mass of Lagos, Nigeria’s smallest state, has a sovereign wealth fund that manages assets that is almost two thirds of the size of Nigeria’s economy. The difference is in the vision that drives governance in both countries.

At a dinner with Singapore’s Minister of State for Defence and Foreign Affairs, Maliki Osman, yesterday evening, he explained again that Singapore, as a small country, is driven by the need to be continually relevant in a fast revolving world.

“We are too small, so we must revolve with the world.

But we cannot just ride the wave, we need to anticipate the wave in order to know

how to fit into the system.

And that has always been our mantra. Always looking at new things, always reinventing ourselves and always looking at the things that will benefit the next generation. For us, every successive leadership is about making it viable for the next generation. And we got it from our own early generation leaders.”

This need to make it easier for the next generation is what drives Temasek’s investments. The fund’s Chairman, Lim Boon Heng explains the guiding principles that drives the management and investments of the company and it is ‘Do Well, Do Right, Do Good.’

“Our journey as a generational investor is one that we take with a deep sense of purpose and responsibility; we are committed to do well as an investor, determined to do right as an institution, and inspired to do good as a steward. Doing well provides us the capacity to fuel our new investments, creates opportunities to grow our portfolio for the future, and gives us the means to care for our communities.

Doing right shapes our values and ethos in Temasek.

We need to reskill and upskill our people to be future ready, and prepare them with the skills to contribute to the wider community beyond Temasek. Doing good drives our philanthropic investments in the broader community as well as underpins our responsibility to safeguard our past reserves, based on the twin pillars of sustainability and good governance” Heng says.

Executive Director and CEO, Temasek International, Lee Theng Kiat, breaks down further into three outcomes that drives the company’s investment philosophy as; transforming economies, growing the middle class, deepening comparative advantages as well as emerging champions.

In its early formative years, Temasek, invested mainly in Singapore but Kiat says that the fund’s investment has now evolved.

Only 27 percent is now in Singapore, another 41 percent are in Asia with China alone accounting for 26 percent of that portfolio and the remaining are in Europe and America.

Through Temasek, Singapore is expanding its economic footprint into the United States and Europe, not as a country seeking aid to survive but as a company making critical investments.

•Continues online @ businessdayonline.com

A

ctivities in the property market will increase in the second half of 2018 on the back of spending for the February 2019 general election and discipline in implementing the provisions of the 2018 budget, especially the provisions for capital projects, real estate sector analysts have predicted.

The real estate sector, unlike other key economic indicators, has been lagging behind long after the wider economy came out of recession in the second quarter of 2017. Analysts note that the sector is yet to exit recession, having been recording negative growth since the last quarter of 2016.

In the last 24 to 30 months, the sector has been grappling with widening vacancy rates and falling rents, rent payment arrears and reduced uptake of new office and retail spaces. A quarter one 2018 report by the Nigerian Bureau of Statistics (NBS) shows that the sector plunged deeper into recession in this quarter.

A breakdown of the report shows that the sector contracted by -9.40 percent in Q1 2018 from -5.92 percent in Q4 2017 and -4.12 percent in Q3 2017. This contraction is -6.3 percentage points worse than the -3.10 percent reported in the comparable period of 2017.

However, it is expected that as politicians embark on electioneering campaign and a lot of money is pushed into the financial system by way of printing posters, organising conferences, placing adverts in both print and electronic media, wooing the electorate for votes with consumables and cash, the impact will be positive on real estate.

“All these will put a lot of money into people’s pocket; people will feed well, pay children’s school fees and the next thing to think about is how to pay their house rents and, in some cases, how to own a home,” Femi Akintunde, GMD/ CEO, Alpha Mead Group, affirmed in an interview.

He stressed that the coming election was going to be an advantage to real estate because a lot of money was

going to come out. “The current government knows that they have to spend their way to win the election and come back. They have to convince Nigerians why they should still vote for them,” he said.

It is also expected that the Federal Government will be committed to implementing the provisions of the 2018 budget, which is made up of 34 percent capital expenditure.

“If you look at the budget, a lot of big projects are being rolled out, like the East-West Road, Niger Delta Development Commission; Ministry of Niger Delta is getting a large chunk of money. A lot of money is going into power and roads infrastructure,” an analyst that craved anonymity, said.

“I believe that the preparatory work for delivering these projects has been done, but government needs to recognize that time is short.

Government needs to pay contractors who are handling projects that have already started like Julius Berger on Lagos-Ibadan Expressway which has stopped work because government is not pay-

ing them,” the analyst added.

A total of N555.99 billion was allocated to the ministry of power, works and housing which is the highest in the budget. Out of that amount, N295 billion has been earmarked for key capital projects, to fund road construction, expansion and maintenance across the country.

Apart from the jobs these projects will create for contractors, engineers and other professionals and labourers involved in road construction, Akintunde reasoned that these roads would connect towns and open up communities, leading to development of houses for residence and commercial activities.

“If all the capital projects are funded and delivered, the impact on real estate will be much. Before the end of the year, we will see the sector taking off. This will happen in three many areas, but particularly in housing which will be affected through the provision of critical infrastructure like power, roads and rails. These are the fundamentals that have impacted housing over time,” he said.

R-L: Odiri Umusu, vice president, business development, CWC Group; Wemimo Oyelana, vice president, CWC Africa; Simbi Wabote, executive sectary, Nigerian Content Development and Monitoring Board (NCDMB), and Patrick Obah, director - planning, research and statistics, NCDMB, after signing a 5-year MoU to organise Practical Nigerian Content Conference in Abuja.

Basic Education Reform: More schools earmarked for Edo BEST ... to train 5,000 teachers on tech-based teaching

E

do State Universal Basic Education Board (SUBEB) says the state government will introduce the Edo Basic Education Sector Transformation (EdoBEST) initiative to more public primary schools in September.

Special adviser to the Governor on Basic Education and acting chairman, Edo SUBEB, Joan Osa-Oviawe, disclosed this in an interview with journalists in Benin City, the state capital.

Explaining that Edo BEST is an initiative of Edo State governor, Godwin Obaseki, to transform the basic education sub-sector in the state, she said, “Edo BEST is holistic and allencompassing and has been put in place to look at issues that may negatively impact pupils’

ability to learn, and find ways to ameliorate them.

“Starting in September, parents and guardians will be arrested for not sending their children to school. Our goal is to ensure that up to 50 percent of public primary schools from Kindergarten to primary six are added to the programme.”

On the package for teachers in the programme, she said, “We are going to train approximately 5000 teachers. We are in the process of finalising the modalities for the training.”

According to Osa-Oviawe, “One of the key areas we are adding to the training curriculum is prevention of child sexual abuse. Our pupils need to be trained on how to avoid child predators.”

Africa Anti-Corruption Day: Edo urges multistakeholder buy-in, novel preventive approaches

E

do State governor, Godwin Obaseki, has called for a multi-stakeholder buy-in in the war against corruption across Africa, calling on private and public sector players to adopt innovative and preventive approaches to check the ugly trend.

Obaseki, who said this on the occasion of the commemoration of the Africa Anti-Corruption Day, noted that there was need for strong institutions equipped with durable structures to assure transparency, accountability and responsiveness in governance in the public or private sphere.

According to Obaseki, “On this day, it is important to note that corruption is one of the most serious

governance challenges the continent is facing today and its far-reaching implications are there for all to see, from failed policies, to truncated dreams, to being home to countries with very troubling development indices.

“But on a day like this, we are reminded that there is hope of redemption if we can muster the courage to do what is right and strengthen institutions for transparency and accountability and entrench innovative, preventive policies to stem the spread and depth of corrupt practices.”

He noted that the state government has worked assiduously to entrench policy reforms that do not only cut the incidence of corruption but also deepen development for the benefit of Edo people.

Thursday 12 July 2018

C002D5556

BUSINESS DAY

7

8

BUSINESS DAY

C002D5556

Thursday 12 July 2018

Thursday 12 July 2018

C002D5556

BUSINESS DAY

9

Thursday 12 July 2018

C002D5556

BUSINESS DAY

9

10

BUSINESS DAY

C002D5556

COMMENT

Thursday 12 July 2018

comment is free

Send 800word comments to comment@businessdayonline.com

Water injustice: do you save water or waste it?

FRANCIS IYOHA Professor Iyoha is of the Department of Accounting, Covenant University and Research Fellow, the Institute of Chartered Accountants of Nigeria (ICAN). He wrote viafoiyoha@ican. org.ng

I

n the Business Day edition of February 13, 2018, I wrote on “the imperative of water accounting in Nigeria.”I emphasized that “water is much more important than crude oil over which we vent our spleen daily in Nigeria” and also that “there is no agitation yet over the control of water because it is ‘available’ everywhere, though not in the quantity and quality desired.” I further argued that the time had become auspicious to advance an agenda to mitigate the water crises we face in Nigeria and all relevant stakeholders should enlist in the crusade. It is interesting that the agitation for control of water has begun much earlier than I had expected with the seemingly unwelcomed Water Resources MUHAMMAD AJAH Muhammad Ajah is an advocate of humanity, peace and good governance in Abuja. E-mail mobahawwah@yahoo.co.uk.

T

he Nigerian foremost airliners in Hajj operations, Max Air and Medview have been approved by the federal government to transport the Nigerian pilgrims to and from the Kingdom of Saudi Arabia for the 2018 Hajj slated to commence third week of July. This is in addition to two other local carriers, Azman Air Services and Top Brass and two Saudi-based carriers, Flynas and Fly Prime. Two companies were approved as cargo services to airfreight pilgrims’ excess luggage.

They are Cargo Zeal Technologies Limited and Medview International Travels and Cargoes.

Both Max Air and Medview have been in the Hajj industry for over two decades with proven expertise. Both of them have acquired enough capacities over the years and have performed wonderfully to the satisfaction of the federal government which should consider the possibilities of granting them carryover as it happened at the advent of the National Hajj Commission of Nigeria (NAHCON). Carryover implies that the airliners were assured of participating in the subsequent airlift operations. That gave them the confidence to prepare and deliver faithfully throughout the periods.

According to the aviation divi-

Bill which some stakeholders have described as ‘dangerous’ for Nigeria. We have a portfolio of legislation in Nigeria. The question is: are they effective? It is out of place for issues of water to be relegated to the backwater of public conversation and only to come up with the idea of water resources bill.

Water is so important to the survival of man, animals, and plants that there can be no life without it. I grew up to find water flowing in taps in my village but the last vestige of those glorious days was in 1975. It is only in the homes of the rich that water flows today.

The rich continue to extract and exploit water resources and consciously and unconsciously waste millions of litres of it every year around the world. This is nothing but a case of ‘water injustice.’ The need to save water cannot be overemphasized and this should be underscored in the message below titled “Save our planet” addressed by a hotel in Tanzania to its guests.

Dear Guest, every day millions of gallons of water are used to wash towels that have only been used once. You make the choice: A towel on the rack means ‘I will use again.’ ‘A towel on the floor means ‘Please replace.’ Thank you for helping

Yes, there is water everywhere (the oceans, seas, lakes, and rivers), but the paradox is that water still remains one of the scarcest commodities in the world today us conserve the Earth’s resources.

The message does not require any interpretation to be understood. It is not about difficulty, if any, in washing towels, neither does it relate to any inability to acquire sufficient washing machines in hotels to wash towels.

This message underscores one thing: the need to judiciously use water because the earth is drying up. One would think there is water everywhere. Yes, there is water everywhere (the oceans, seas, lakes, and rivers), but the paradox is that water still remains one of the scarcest commodities in the world today. In Nigeria, for instance, it is not just that the quantity of water is low, the quality is lamentably worrisome. I believe that everyone with any sense of manhood should care about the water situation in Nigeria, not just for the present generation but for

generations yet unborn whose ‘water future’ we seem to be taking on overdraft.

The UN realizes the importance of water hence it occupies a place in its SDGs No 6: “Ensure availability and sustainable management of water and sanitation for all by 2030.”This means there shall be universal and equitable access to safe and affordable drinking water for all, access to adequate and equitable sanitation and hygiene for all and end of open defecation, improve water quality by reducing pollution, eliminating dumping and minimizing the release of hazardous chemicals and materials. Does the water resources bill have the capacity to address all of this? I think it should be more of substantially increasing water-use efficiency across all sectors and ensure sustainable withdrawals and supply of freshwater to address water scarcity and substantially reduce the number of people suffering from water scarcity (Goal No 6.4).

The good news is that some organizations and individuals are conscious of the dangers posed by lack of usable water and are taking measures to mitigate any unproductive use of it.

I believe the war against water could be better won at all levels

by mass education of the use of water. For instance, are many households aware that they need to install low-flow pumping fixtures in their homes? Do we have water efficient irrigations systems and are leaks fixed promptly? Do we know that the use of water has to be accounted for (using water accounting framework) especially at the macro level and that recycling water at the industrial level is not an option but a priority? Let’s be conscious of the indicators that show whether we are wasting water or not.

There are a number of vices in Nigeria against which legislation should be sought and I do not believe water resource is one of them. With or without legislation, water crises will continue as long as wrong water management approaches and decisions remain the pastime, not just of the government but of all and sundry. Every year, billions of Naira is budgeted and spent on water and water-related matters.

Is anyone able to tell anybody how many litres of water are extracted and used? The answer is No and shall remain No until it becomes easier to access water than it is to access AK 47 rifles.

Send reactions to: comment@businessdayonline.com

Max Air, Medview, et al for 2018 Hajj operations sion of NAHCON, the airlift of Nigerian pilgrims to and from Saudi Arabia will start from the 21st of July to 20th September, 2018. The Saudi airspace for Hajj operations will open on 15th July and close on 11th August, while Nigerian pilgrims will commence their return trips to motherland on 28thAugust. It is expected that a large percentage of the pilgrims will land in Madinah, a feat that the present administration of the commission has achieved in the last few years. The feat has eased the controversy that often surrounded the Miqat palaver which, although resolved by the commission through the national ulama team, has remained mismanaged by some scholars of sects.

But to be sure of the journey, all intending Muslim pilgrims who have paid fully and have registered for the Hajj must ensure that their details have been correctly captured and uploaded in their respective state boards’ portals on or before July 12, 2018, failure of which will affect their chances of performing the Hajj. According to the head of the public affairs division of the commission, Fatima Sanda Usara, those intending pilgrims who are not properly captured will be rendered ineligible to perform Hajj and those whose names do not appear on the portal will not be issued travel visa by the Saudi Authorities.

As required by the instant federal government’s regulations, NAHCON placed adverts in six national dailies for inter-

ested airline operators to airlift Nigerian intending pilgrims for 2018 Hajj. It was also placed on the website of the commission. The six airliners applied and met with the requirements. Three cargo operators applied but two qualified.

A 28-man screening committee led by NAHCON’s commissioner of operations, Alhaji Abdullahi Modibbo Saleh alongside 10-man secretariat subjected the applicants to rigorous procedural exercises.

The committee was made of experts from the aviation industry, such as Nigerian Civil Aviation Authority (NCAA), Nigerian Meteorological Agency (NIMET), Nigerian Airspace Management Agency (NAMA), the Federal Airports Authority of Nigeria (FAAN), Accident Investigation Bureau (AIB) and the Nigeria Customs Service and representatives from other key stakeholders in Hajj operations. For transparency, the events were even recorded and during the price negotiations, NAHCON fought for reduction of the prices against the 2017 Hajj or at least maintenance of status quo.

The airliners attempted to prove beyond doubts the need to increase the airfare due to the increase in other requirements they need for the operations. After tough negotiations, it was agreed that pilgrims from Maiduguri and Yola departure centers of NAHCON will pay US$1600, pilgrims from other departure centers within the northern states will pay US$1650 while those from the southern states will pay US$1700. These were the airfares last year. For excess luggage, pilgrim from the north will pay 16 Saudi Riyals for each kilo while those from

the south will pay 17 Saudi Riyals.

At the inauguration of the screening committee, Medview called on NAHCON to give more allocations to indigenous carriers, since it would create employment opportunities for many citizens.

The airline, however, commended the commission for the transparency and accountability it had displayed in the handling, screening and selection of air carriers since its inception in 2006. Media consultant of the company, Obuke Oyibhota, added that Medview was capable and ready for the pilgrims for the 2018 Hajj. The airlines proposed aircrafts they will use for the operations. Max Air proposed four: 3NOS B747-400, 5N-DBK, 5N-HMM and 5N-HMB. Medview proposed three: B747400, B767-30ER and B777-200.

Flynass proposed seven: B747 (ER-BAC), B747, A330, A330, A330, B767 and B767. Others proposed different aircrafts in their fleet.

While signing the airlift agreements, the chairman of the commission, Bar. Abdullahi Mukhtar Muhammad, charged them to braze up for the operations and ensure delivery of the best services to the Nigerian pilgrims and stressed that the level of their commitment and services rendered will determine the continued patronage by NAHCON. He expressed appreciation for the patriotism displayed by the Nigerian local carriers who helped in bringing respite in the 2018 Hajj fares.

It will be recalled that Max Air Limited recently ventured into the Nigerian domestic air transport

market in addition to its usual Hajj and Umrah operations. Vice Chairman of the company, Alhaji Bashir Mangal, said the local operations cover Abuja, Lagos and Kano routes, while other routes like Sokoto, Maiduguri, Port Harcourt and Yola will follow subsequently. He said that Max Air got its Air Operation Certificate (AOC) from the Nigerian Civil Aviation Authority (NCAA) in 2007 and had been operating in Nigeria mainly in Hajj and Umrah operations since then. According to him, the airline has in its fleet a number of Boeing 737-300, 737-400 and 737500 as well as wide body B747-600 and 747-700 to operate with. In his move in 2018 to reposition Mangal Airlines its owner, Alhaji Dahiru Mangal, re-branded to Max Air. As at January 2018, the company, with its headquarters in Kano has five aircrafts in its fleet. “We are not new in Nigerian aviation market, we have been here for about 15 years now and we got our Air Operation Certificate (AOC) since over 10 years ago doing Hajj and Umrah and worldwide charter.By the grace of God, we are going to do our best to contribute to the development of Nigerian aviation industry and we will try to cover all the destinations in Nigeria within the shortest possible time”, Bashir Mangal posited.

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

Send reactions to: comment@businessdayonline.com

Thursday 12 July 2018

C002D5556

COMMENT

BUSINESS DAY

11

comment is free

Send 800word comments to comment@businessdayonline.com

As trade wars broaden, Europe is the key to future DAN STEINBOCK Dan Steinbock is the founder of Difference Group and has served as research director of international business at the India, China and America Institute (US) and a visiting fellow at the Shanghai Institute for International Studies (China) and the EU Center (Singapore). For more, see http://www.differencegroup. net/

A

fter the meeting of China and Central and East European (CEE) countries in Sofia, Bulgaria, Chinese Premier Li Keqiang rushed to the fifth round of intergovernmental consultations between China and Germany.

These visits have been overshadowed by the specter of the U.S. trade wars that are about to broaden over Europe. In few days, Trump will start his own European visit to attend the NATO summit in Brussels, meet with Queen Elizabeth and Prime Minister May in the UK, and to sit down with Vladimir Putin in Helsinki in mid-July.

The White House will seek to push US NATO allies to finance a greater share of the joint military expenditures, strengthen AngloSaxon ties against Brussels and to warm its relationship with Russia amid the new U.S.-led Cold War. Behind the façade, the Trump administration seeks to deflect attention from the impending U.S.-EU trade war.

CEE-China 16+1 cooperation will broaden Established in 2012, the talks between China and CEE countries have supported faster development as trade volumes have soared to $68 billion last year, which translates to 16 percent growth on a year-to-year basis.

After the CEE economies were harmed by the global financial crisis and the subsequent European debt crisis, China’s economic contribution has been vital. From Beijing’s perspective, the CEE countries, along with key Mediterranean economies, have served as China’s foothold to Europe and the early development of the One Road One Belt (OBOR) initiatives, particularly in Eastern Europe.

From the standpoint of the CEE countries, the 16+1 Framework has been economically important by boosting Eastern Europe’s role and leverage within the EU. As Brussels’ focus has been on European sovereign debt, massive bailouts, the UK Brexit and new disintegration pressures, the CEE economies, which used to be EU priorities in the early ‘90s, have been effectively ignored.

China’s strong contribution to global economic prospects, which amounts to 30 percent of global economic growth, has supported the resilience of the

If CEE is China’s door to Eastern Europe, Germany remains the key to advanced Europe. Following the establishment of strategic partnership in 2014, Chinese-German relations have steadily broadened not just in trade and investment, but in technology and innovation

CEE economies, even amid Washington’s unilateral trade wars.

Joint interests in peace and stability, trade and investment provide a deepening basis for 16+1 cooperation in the future.

Converging Chinese-German interests If CEE is China’s door to Eastern Europe, Germany remains the key to advanced Europe. Following the establishment of strategic partnership in 2014, Chinese-German relations have steadily broadened not just in trade and investment, but in technology and innovation.

While joint interests in the bilateral ties are increasing, the underlying environment is growing

more challenging. As Chancellor Merkel seeks to sustain integrated EU, she has been under fire from Bavarian conservatives in her government, due to a challenge by Interior Minister Horst Seehofer about immigration policy.

For 60 years, Merkel’s Christian Democratic Union (CDU) has relied on its junior partner, the conservative Christian Social Union (CSU). The dispute about immigration has eroded the ties, even though Merkel contained the friction by agreeing to more hawkish immigration policy.

As German growth is slowing and German exporters have been harmed by U.S. trade friction, the political support of CDU and CSU has eroded, while the ratings social Democrats (SDP) have sunk to below 20 percent.

The beneficiary of these trends is the radical right’s Alternative for Germany (AfD).

For now, Merkel’s cautious diplomacy does prevail in Berlin and Brussels, yet Trump’s trade stance will mean more headwinds in the fall.

China-EU cooperation While China is US tariffs’ first target ; the next ones will include some of the largest trading economies in Europe, East Asia and Americas. In the process, the joint economic (trade and investment), political (international cooperation), even strategic

interests (Iran, climate change) between China and the EU, and Germany, are converging.

Last week, Merkel explicitly warned President Trump not to unleash an all-out trade war after U.S. president threatened to impose steep tariffs against the EU. The White House is mulling import taxes of 20 percent on EU cars. The EU has already slapped tariffs on US products including bourbon, jeans and Harley-Davidson motorcycles, as a symbolic tit-for-tat response to the metals duties.

But that’s just a warning shot.

Merkel has targeted Trump over his complaint that the EU, in particular Germany, is running a massive trade surplus against the US. These calculations are flawed because they are only based only on goods, not services in which US has a surplus against the EU. Accordingly, Merkel backs a “digital tax” that would target multinationals like Amazon, Facebook or Google, which have come under fire for shifting earnings around Europe to pay lower taxes.

Both Berlin and Brussels are beginning to face the inconvenient truth. Without a coordinated response, Trump’s “America First” doctrine will foster the risk of an all-out trade war, which would hurt global confidence, economic growth and credit.

Send reactions to: comment@businessdayonline.com

Breakdown of law and order is a threat to human life in Nigeria

OLUWADARA ALEGBELEYE Oluwadara is a writer as well as an academic researcher. She is currently a PhD student at the Department of Food Science, University of Campinas

A

significant percentage of Nigeria’s challenges stem from breakdown of law and order. Our institutions deteriorated to this sorry state, in large part due to lawlessness. Other horrific features of the Nigerian experience; bad service delivery, poor infrastructure and so on are inextricably linked to our collective extreme lawlessness. There are environmental, trade, food production and processing laws, codes and ethics, brazenly flouted by individuals, corporations, religious bodies and other enterprises without any repercussions

whatsoever. In many cases, some people are not even aware of certain extant laws and so innocuously but inevitably violate them. This undesirable standard has claimed numerous lives, rendered others morbid, disenfranchised several groups of people; particularly the less privileged and reduced the overall life quality of so many Nigerians.

The tragic incident of Thursday, June 28, 2018, that claimed lives, maimed several others, polluted the environment, damaged property and ruined livelihoods is the latest heartbreaking display of our Country’s disregard for the safety and wellbeing of its citizens. To be clear, accidents are bound to happen. That is a sad reality of life. This unfortunate incident however was, unnecessary and avoidable. Apparently, there is a law in the state, barring heavy vehicles from plying the roads before 10 PM. However, this truck was on the road before 10 PM, recklessly shunning an established regulation, thereby compromising the wellbeing of several other citizens. There are other laws enacted to prevent

these sorts of mishap; vehicular weight and design stipulations, speed limits, maintenance standard and many other road traffic laws, routinely violated by not only heavy vehicle drivers, but many other road users as well. Factual details of the incident are lacking, as there is no conclusive output of a constructive investigation yet, but according to official media briefings, preliminary investigation indicate that the offending truck was loaded to twice its pulling capacity.

Our societal culture of blatantly disregarding laws and regulations have resulted in similarly unwarranted tragedies in the past, such as the loss of at least 100 lives in a similar incident, which occurred in Port Harcourt in 2012. Likewise, a report in the Premium Times notes that Lagos state recorded 115 petroleum tanker accidents in 2016 alone.

It is typical of most humans, especially the unscrupulous to break, bend or attempt to manipulate the law; however, what distinguishes other sane societies from ours is enforcement. Admittedly, the government’s job seems difficult in this instance. In the past, attempts

to regulate the transportation of petroleum and petroleum products on roads led to strike actions that crippled socio-economic activities throughout the country because energy supply was disrupted. This generated significant distress, yielding misguided public outrage that forced the government to soft-pedal. However, the government cannot afford to be hapless or helpless, considering that political leaders are elected to make tough decisions that will ensure the safety of lives and property. There are other contributory factors however, such as powerful forces at play here; big corporations or individuals with intimidating political and business connections who evade the law. Such blatant evasion of the law has to stop.

Respective state governments need to act. In states where relevant laws exist, enforcement is critical. These states can use agencies and strategies within their jurisdiction while ensuring proper training and remuneration of enforcement agents.

States without such laws, should enact reasonable laws, that can

be easily enforced as quickly as possible. Infrastructural development is essential for sustainable change in this regard. Rail system is a more acceptable alternative for transport of petroleum and petroleum products and we just must find a way to develop functional, effective rail transportation. It would limit the ‘incidence’ of heavy vehicles on Nigerian roads. In the interim, specific regulations for oil tankers should be initiated and rigorously enforced. Relevant investment in road technology e.g. CCTV cameras that can monitor daily events on roads, to aid trace-back investigations in future is necessary.

Improved provisions of emergency relief support measures is also desirable. This latest incident is a harbinger of possibly more catastrophic future accidents, if we do not address our partial and ultimately weak law enforcement crisis in this country. Laws are useless if they are not enforced, can this fact possibly be overemphasized?

Send reactions to: comment@businessdayonline.com

12

BUSINESS DAY

C002D5556

Editorial

Thursday 12 July 2018

PUBLISHER/CEO

On government creation and funding of ranches

EDITOR-IN-CHIEF Prof. Onwuchekwa Jemie

lans by the Federal G overnment to create and fund 94 cattle ranches across ten states at the massive cost of N179billion have drawn howls of protest from groups, organisations and communities in the South and Middle Belt of Nigeria.

These are areas for whom the ranches are supposed to be a solution to the challenge of clashes between farmers and herders. The Federal Government would inject N70b into the project in the first three years.

BusinessDay examines the case for and against the government’s effort at providing the impetus and funding for innovation in animal husbandry in the country. We consider in particular the stated rationale against the backdrop of cattle rearing as an age-long private sector occupation.

Ranches are also not new in the land, casting doubt on the genuineness of the Government’s motives.

There are better ways in our view.

According to the National Economic Council headed by Vice President Yemi O sinbajo, a pro-

Frank Aigbogun

EDITOR Anthony Osae-Brown DEPUTY EDITORS John Osadolor, Abuja Bill Okonedo NEWS EDITOR Patrick Atuanya EXECUTIVE DIRECTOR, SALES AND MARKETING Kola Garuba EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, DIGITAL SERVICES Oghenevwoke Ighure ADVERT MANAGER Adeola Ajewole MANAGER, SYSTEMS & CONTROL Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso SUBSCRIPTIONS MANAGER Patrick Ijegbai CIRCULATION MANAGER John Okpaire GM, BUSINESS DEVELOPMENT (North)

Bashir Ibrahim Hassan

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

P

fessor of Law, the project would take off as soon as possible in Benue and Nassarawa states. Minister of Agriculture Chief AuduOgbeh assured that the government would not acquire any land for the project forcefully. Ogbeh is from Benue State, the epicentre of disputations between herders and farmers.

Reports say Dr Andrew Kwasari is the coordinator. According to Kwasari, “The National Livestock Implementation Plan is a mediation plan stemming from meetings and recommendations of the Fe deral Ministry of Agriculture and Rural Development (FMARD) and the National Economic Council (NEC) in 2017 as regards state interventions following the constant pastoralist-farmer conflicts.

“We are going to have 94 ranches in 10 states. We have received 21 gazetted grazing reserves from seven states. The plan focuses on pilot intervention in the frontline states Adamawa, Benue, Edo, Ebonyi, Kaduna, Nasarawa, Oyo, Plateau, Taraba, and Zamfara.

“A Ranch Design Plan has als o been propos ed in models of various sizes clustered in 94 locations in the ten pilot states. We will

have clusters of 30, 60, 150, and 300 cow ranch models in a location within the donated and gazetted grazing reserves.The total spending for the 10-year period is slightly in excess of N179 billion. Funding for the first three years of the pilot phase is about N70 billion.”

The Federal Government wants to create one more State-Owned Enterprise (SOE) with a substantial initial capital and far-flung operations spread around ten states. It comes against the backdrop of the known failure of the many stateowned enterprises. It also comes against the context of the failure of the current administration as the owner of various parastatals to do something as fundamental as constituting the boards of its SOEs for more than two years.

The stated rationale for this step into one more SOE is to stem the incidence of farmer-herder clashes and the associated cases of internally displaced persons, improve nomadic education as well as increase the productivity of Nigerian livestock.

We note that State Owned Enterprises remain a feature of the global economy.

Their share of the Fortune Global 500 grew from 9% in

2005 to 23% in 2014, driven mainly by the growth of Chinese SOEs such as SINOPEC Group, China National Petroleum and the State Grid, according to a report by PWC. State-owned enterprises can act as catalysts for public value creation and remain an option in the toolbox of government to deliver desired outcomes.

In this age, experts cite as critical success factors for SOEs active ownership and management as well as avoiding competing unfairly in markets where private and third sector enterprises (not for profit) can deliver more efficiently and effectively the goods and services that citizens need and want.

Advantages of stateowned enterprises include furthering social outcomes, providing physical infrastructure and creating stability in times of crisis within and across supply chains.

Disadvantages include the destruction of value in the absence of best practices in ownership and management as well as corruption, bribery and inefficiency.

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

EDITORIAL ADVISORY BOARD Dick Kramer - Chairman Imo Itsueli Mohammed Hayatudeen Albert Alos Funke Osibodu Afolabi Oladele Dayo Lawuyi Vincent Maduka Maneesh Garg Keith Richards Opeyemi Agbaje Amina Oyagbola Bolanle Onagoruwa Fola Laoye Chuka Mordi Sim Shagaya Mezuo Nwuneli Emeka Emuwa Charles Anudu Tunji Adegbesan Eyo Ekpo

ENQUIRIES NEWS ROOM 08022238495 08034009034 Lagos 08033160837 Abuja

}

ADVERTISING 01-2799110 08116759801 08082496194 SUBSCRIPTIONS 01-2799101 07032496069 07054563299 www.businessdayonline.com The Brook, 6 Point Road, GRA, Apapa, Lagos, Nigeria.

01-2799100 LEGAL ADVISERS The Law Union

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

OUR CORE VALUES

BusinessDay avidly thrives on the mainstay of our core values of being The Fourth Estate, Credible, Independent, Entrepreneurial and Purpose-Driven.

• The Fourth Estate: We take pride in being guarantors of liberal economic thought • Credible: We believe in the principle of being objective, fair and fact-based • Independent: Our quest for liberal economic thought means that we are independent of private and public interests.

• Entrepreneurial: We constantly search for new opportunities, maintaining the highest ethical standards in all we do • Purpose-Driven: We are committed to assembling a team of highly talented and motivated people that share our vision, while treating them with respect and fairness. www.businessdayonline.com

Thursday 12 July 2018

BUSINESS

COMPANIES & MARKETS

DAY

13

NPF Microfinance Bank records 25% increase in turnover

Pg. 14

Co m pa n y n e w s a n a ly s i s a n d i n s i g h t

NAICOM to drive financial inclusion on new development plan Modestus Anaesoronye

I

nsurance regulator, the National Insurance Commission (NAICOM) said it’s committed to driving the financial inclusion project in its new Nigerian Insurance Industry Development Plan (NIIDP).

The Commission, during the presentation of highlights of the plan at the 2018 Insurance Industry Consultative Council (IICC) National Insurance Conference held in Abuja said all stakeholders in the industry including directors will be carried along to make implementation easier.

“We understand the role and importance of directors of insurance companies in driving this development plan, so we will carry them along, George Onekhena, deputy commissioner for Insurance, Finance and Administration said during the question and answer section at the conference.

Mohammed Kari, commissioner for Insurance (CFI) had said that the plan will be launched soon.

He said that the NIIDP would have financial inclusion as a major component,

which the country’s insurance industry would use to reduce the number of citizens that were financially excluded by developing friendly premium policies.

Kari quoting Christine Lagarde the managing director of the International Monetary Fund (IMF) at the 2014 International Forum for Financial Inclusion held in Mexico, said “the poor do not have access to basic financial services such as payments savings and insurance.

“Accessing financial services will help families increase investments and consumption, help in insuring against unfavorable events, thus reducing the poverty level during any occurrence,” he said.

Kari said the loophole discovered by Lagarde had made Nigeria to launch the National Financial Inclusion Strategy (NFIS) to reduce the percentage of adults that were excluded from financial services from 46.3 per cent to 20 per cent by 2020.

The CFI said that work had been concluded on the plan with inputs from KPMG, a consulting firm, which would independently monitor its implementation to ensure each insurance arm is assigned responsibilities.

“It may interest you

to know that the plan has been presented to the Insurers Committee, a body comprising management of NAICOM, Chief Executuve Officers (CEO’s) of insurance companies.”

He said that heads of insurance trade associations would be included to ensure that

S

hell Nigeria has launched a search for future inventors and scientists in Nigerian schools with focus on energy, water and food.

This is as the company said it spent whopping N1.57 billion, equal to $5.2 million on scholarships in 2017 alone.

To boost the hunger for inventions in Nigerian schools, Shell says it has in the past eight months equipped 120 young Nigerian students and their teachers across 12 schools in Lagos and Rivers states with science, technology, engineering and mathematics, all because of problem-solving abilities seen in them.

The search for inventors led to an exhibition of ‘inventions’ or technological fabrications based on various scientific principles studied in schools.

The schools so far work-

ing on the innovative scheme include Arch-Deacon Brown Educational Centre (ABEC) now managed by Ibim Semenitari which showcased a sewage conversion/purification machine; Bloombreed High School run by wife of a former Shell MD which presented a hydro-electric wheel; Brookstone International Secondary School which unveiled an electro-irrigation machine; Bishop Crowther Memorial Secondary School with a mini hydro-electric generator that supplies light too; Jephthah Comprehensive Secondary School which came with a Bio-Gas production system; and Oginigba Comprehensive School which showcased a hydro-electric water filtration machine that also used water to generate electricity.

All the inventions and fabrications dwelt on water, food and energy, the focus of the Shell support scheme. Also, Shell officials made the students understand that they were the

social cohesion and bridging the gap in income equality and inclusive economic growth and development. ” Kari said.

Kari said that the NIIDP would have global objective which would have different dimensions with countries and institutions willing to develop

models to suit their peculiar environment.

“However, the insurance sector in Nigeria would effectively and efficiently navigate it to increase the number of policyholders while reducing the figure of the financially excluded, which are part of what the NIIDP contain.” he said.

L-R: Kenneth Esenwah, marketing director; Marlene Kiniffo-Zounon, commercial director, both of Lafarge Africa Plc; B.O Oshuntola, MD, Temitope Oil Nigeria; Michel Puchercos, MD/CCEO Lafarge Africa Plc., and Durogbola Osunfisan of Traidac Enterprises, during the presentation of gifts at Lafarge Africa’s customer appreciation event in Lagos.

Shell targets student inventors in energy, water, food sectors Ignatius Chukwu

every player in the industry would be on the same page with NAICOM, the regulator.

“I use this medium to commend insurance committee and KPMG for the good job on the NIIDP. “As we may be aware, financial inclusion is premised on the principles of equity like

scientists of the future expected to solve the problems of humanity where the present generation failed.

Gloria Udoh, a senior manager in Social Investment, Shell, said the oil giant believes in exploration, thus the decision to set up a science-based scheme for students called ‘Next Explorers’. She said the older generation seemed to have made a lot of mistakes which she urged the new generation to correct.

The general manager, External Relations of Shell Nigeria, Igo Weli, in an address read by Emmanuel Anyim, said ‘NXExplorers’ is a global Shell Education initiative focused on STEM education. (STEM is short for Technology, Engineering and Mathematics). “It is designed to equip young people with a diverse range of tools and problem-solving skills to address the complex challenges affecting the food-water-energy nexus and its linkages.”

UK brokers’ market share rises as digital channels engage SMEs

D

ata analytics company GlobalData and ABI statistics have reported that UK brokers continue to dominate commercial re/insurance distribution, and grew to an estimated footprint of £1.33 billion over 2017 thanks to the prevalence of digital channels like price comparison websites.

Despite the dominance of brokers in the UK market, 2016 marked the first time in years that their influence grew, reflecting the waning status of traditional brokers.

Whilst larger companies rely almost exclusively on brokers for advice and management, GlobalData found that small to medium-sized enterprises (SMEs) often seek less complicated and

time-consuming policies, explaining the rise in online insurance and price comparison websites.

Ben Carey-Evans, financial analyst at GlobalData, explained: “The broker channel had been steadily declining up to 2016, but the emergence of the digital channel in commercial insurance has reversed this.

“Price comparison sites, which are classed as brokers as they refer customers onto insurers, have established a foothold in the SME market, and innovative, modern brokers, such as Simply Business, have also taken shares from more traditional brokers.”

GlobalData found that, over 2017, the size of the UK SME market declined,

while the non-SME space grew, which increased brokers’ market share at the expense of the direct channel, as brokers tend to dominate the non-SME re/insurance market.

Price comparison websites now hold 14.6 percent of the overall SME market, up from 9.6 percent in 2017, according to GlobalData’s 2017 UK SME Insurance Survey.

Carey-Evans added: “A lot of the policies aimed at sole traders and micro SMEs are very similar to personal lines products, such as motor and tool cover for tradesmen, meaning that the crossover from personal lines – where price comparison sites have had great success – is natural for the customer and insurer.”

14

BUSINESS DAY

C002D5556

COMPANIES & MARKETS NPF Microfinance Bank records 25% increase in turnover Stories by HOPE MOSES-ASHIKE

N

P F Mi c ro f i nance Bank Plc defiled the tough operating environment in 2017 as it recorded improved turnover of N3.655 billion in the financial year ended December 31, 2017, this represents 25 percent over the level of N2.925 billion in the preceding year.

The bank grew its Profit After Tax, PAT, by 14 percent from N554.9 million in 2016 to N631.89 million in the year under review.

A breakdown of the financial result of the bank showed that asset improved from N12.36 billion in 2016 to N15.95 billion in 2017, representing a 29.04 percent where shareholders fund increased from N4.463 billion in 2016 to N4.752 billion in 2017.

The bank operating expense increased by 32 percent from N1.898 billion in 2016 to N2.516 billion in 2017 due to increased inflationary cost, increased number of staff and branches and rising cost asset maintenance due to age.

However, the bank intends to notify the capital market of its plan to do a public offer after due diligence on the financial landscape, bearing in mind the

long tenor nature of capital market investment while disclosing plans to cushion the effect of hard economy and reduce the excruciating pain involved in doing business in the country.

Speaking at the 24th Annual General Meeting held in Kano, Managing Director/CEO, NPF MfB, Akin Lawal, said that in spite of the recessional period prevailing in the greater part of 2017, coupled with unstable macroeconomic state of the economy and incessant economic headwinds retarding the bank’s momentum, the bank’s turnover improved by 25 percent from N2.925 billion to N3.655 billion in the year under review.

Lawal who said that the bank’s profit before tax marginally increased from N803.4 million in 2016 to N819.8 million in 2017 as a result of the full cost of the 10 branches opened in 2016 adding that the management has put a lot of plans in place to curtail the rising cost effect and to optimize services.

The bank however expended N187.9 billion on tax, a reduction of 24.39 percent and N248.5 million.

In the final analysis, a unit of the bank’s share attracted earnings of 28kobo in 2017 as against 24kobo in 2016, out of this, the board proposed an increased dividend of 17kobo in the year

when compared to 15kobo it has paid in three successive years.

He said: “As we entered 2017 in the midst of worst depression in the last 24 years of existence, rising inflationary trend and worsening exchange rate exacerbated with oil price vandalisation of our economic mainstay-oil pipelines and loads of reported ethnic clashes across the federation, our bank’s management ensured that the 3year strategic plan in operation was carefully reviewed to reflect economic realities and to ensure economic fundamentals of the bank do not slide into depression.

“This we did with good dexterity, tenacity of purpose and adequate cost management policies which at the end have put smiles on all our faces today. With the technical exit of the country from depression in the second quarter of 2017, the economic fundamentals of the bank steadily continue in a positive trend,” he said.

Earlier, Chairman, NPF MfB, Rtd DIG, Azubuko Udah, said that non-performing loan ratio reduced to 2.7 percent in December 2017 from 3.2 percent in December 2016 which is below the regulatory threshold of five percent and the internal benchmark of three percent.

He added that capital remained strong with capital adequacy ratio of 41 percent.

Ecobank partners Total Nigeria for agency banking services

E

cobank Nigeria has commenced a strategic partnership with Total Nigeria Limited to offer agency banking services at Total filling stations across Nigeria.

The bank will kick off with 100 stations carefully selected to ensure members of the public can carry out their financial transactions such as deposits, withdrawals and account opening at the outlets known as Ecobank Xpress Points.

In addition, transfers to Ecobank and other banks, bill payments, airtime top up with ease in the selected locations.

Announcing the partnership in Lagos, Carol Oyedeji, executive director, consumer banking, Ecobank Nigeria said the deployment of Ecobank Xpress Points via Total Nigeria locations is an extension of the bank’s distribution and financial inclusion strategy to take banking service to the

doorstep of every Nigerian and African.

She stated that the outlets will offer convenient and accessible financial services in a cost effective and secure manner. She reiterated that Ecobank is determined to extend the reach of its banking services to customers in remote and rural locations with its agency banking initiative.

“To deliver our strategy of reaching 100 million customers by 2020, we have created innovative platforms, products and services, which are already serving a much larger customer base,” explained Carol Oyedeji.

She further stated that “these agent locations will support some of the innovative services we have introduced to the market such as Xpress Cash which allows customers to withdraw cash at ATMs without their cards, transfers within and across 33 countries via the Ecobank Mo-

bile App and our proprietary money transfer service, Rapid Transfer, among others”.

Commenting on the partnership, Total Nigeria Plc’s general manager sales and marketing, Adesua Adewole, explained that “At Total, the team develops our network of service stations everywhere in Nigeria daily, to bring Total closer to its 200,000 daily customers. Becoming real one-stop shops, our 570 stations offer quality products and services tailored to their needs.

She stated that the partnership with Ecobank is an illustration of one of Total’s strategies that will strengthen the cashless initiative of the Central Bank of Nigeria (CBN).

Some of Ecobank’s agency banking partners already offering this service in Lagos include Buymore Supermarket chain, Kenzo Retail Supermarket chain and Save-a-Lot Supermarket.

Thursday 12 July 2018

Thursday 12 July 2018

C002D5556

BUSINESS DAY

15

COMPANIES & MARKETS FIXD car health monitoring device now available in Nigeria

G

oldstreet Technologies Limited has introduced the innovative Onboard Diagnostic Device (OBD) known as FIXD into the Nigerian market. FIXD, rated as the best OBD by Car Diagnostic Review Tools, detects and explains problems facing vehicle in easily understandable ways. It is compatible with all petrol powered vehicles made after 1996.

Introduction of the highly rated Onboard Diagnostic Device affirms Goldstreet Technologies’ commitment to using technology to solve problems facing everyday Nigerians, institutions, corporations and governments thereby eliminating inefficiencies stunting the country’s growth and development.

Speaking at the launch of FIXD, Abeke Orhonor, Chief Executive Officer, Goldstreet Technologies disclosed that *“FIXD is the easiest way for

vehicle owners and drivers to understand and maintain their automobiles.

It is a hardware-software combo that gives vehicle owners actionable information about their vehicle. The hardware feeds information from the vehicle to an app on a smartphone which pinpoints problems. The data highlighting the identified problem can be shared with a mechanic to ensure efficient and cost-effective resolution.”* Explaining how FIXD works, Orhonor said the easy to use OBD works with smartphones to detect and understand the problems a vehicle may be having. *“You don’t have to be a ‘car person’ to use FIXD. The sensor (hardware) plugs directly into a vehicle and connects to the FIXD app through Bluetooth. It immediately diagnoses and translates the vehicle’s problems in simple terms; while also indicating the severity and consequences of continued

Business Event

driving”, *he informs.

In addition, FIXD demystifies and interprets the dreaded ‘check engine light’ notification. It detects and explains the problems triggering the notice in less than a minute. The OBD also provides vehicle maintenance reminders through mobile phone notifications thereby ensuring that car owners and drivers can plan ahead.

Goldstreet Technologies is a solution provider covering Nigeria’s engineering industry value chain. The company has successfully partnered businesses, institutions and governments to deliver solutions that eliminate value chain inefficiencies. It is committed to revolutionising the automobile maintenance value chain in Nigeria by ensuring that vehicles are properly maintained to ensure long-term value for owners while also mitigating against avoidable road accidents often associated with poor repairs and maintenance culture.

The Vega-Orange design thinking workshop

T

he Vega-Or- ange certificate workshops, a collaboration project from two of Africa’s top brand schools Orange Academy Lagos and Vega School South Africa took place on the 20th & 21st of June 2018 was a huge success. This year’s focus was on Design Thinking for Inno- vation. The collaborative workshop started last year with a focus on Strategic Brand Building. This col- laboration is the first of its kind in in subSaharan Af- rica where two top brand schools offer a single certificate to participants.

The workshop had facil- itators with the combined experience of over 80 years in the industry. The work- shop had

such facilita- tors as Lampe Omoyele MD 141 Worldwide and Orange Academy board member, Michelle O’Hara; a Design Thinking special- ist and educator from Vega School, South Africa and Colin Morris; The brand pitch doctor across Africa The workshop had top- ics like; Design Strategy and Technology, Identi- fying feasible solutions, framing a challenge for design thinking, market- ing innovations, ambi- ent marketing etc. The workshop participants cut across several industries, from HR and Sales Man- agers and Directors from the press, manufacturing, creative communications, banks etc from across Ni- geria. There were

vari- ous sessions with creative tasks which were majorly practical, hands-on expe- rience on various meth- ods of creating innovative designs for various in- dustries. The event ended with a lot of excitement, the participants could not wait to go back and apply all they’ve learnt in the workshop.

The Vega-Orange Workshop holds once every year and the next Work- shop will be taking place in May 2019 at Cape Town in South Africa. Return flight, accommodation and feeding will be taken care by Orange Academy. Registrations is ongoing at www.cluborangeng. com You can also contact info@ cluborangeng.com or fol- low our social handles for updates and other courses and events.

L-R: Ife Oyeyipo, manager, youth segment, MTN Nigeria; Chris Olugbenga Ajila, deputy vice chancellor, administration, Obafemi Awolowo University; Omotayo George, senior manager, youth segment, MTN Nigeria, and Eyitope Ogunbodede, vice chancellor, Obafemi Awolowo University, during MTN Nigeria’s courtesy visit to the Vice Chancellor’s Office during the MTN Pulse Campus Invasion at the Obafemi Awolowo University, Ile-Ife, Osun State

Ken Onyeali-Ikpe, group chief, Insight Redefini, (c) with the Lifetime Achievement Award, presented to him at the 2018 MarketingEdge Brands and Advertising Excellence Awards, held at Ikeja recently.

He is flanked John Ajayi, publisher, Marketing Edge, (l), and his wife Modupe Ajayi (r)

L-R: Akande Stephen, head, ICT, Capital Bancorp Plc; Olawale Olawarinumi, chief compliance officer; Opeyemi Ayoola, head, Stockbroking, and Opeyemi Ojomu, staff, Stockbroking Operations, during launching of Capital Bancorp Plc’s Initiatives for Brand Positioning in Lagos. Pic by Olawale Amoo

L-R: Pat Anabor, deputy president, Nigerian Institute of Management (Chartered); Olukunle Iyanda, president/chairman of council, NIM; Moruf Kolawole Ayanwale, guest speaker and chief executive officer, Centrespread Grey; Margaret Adeleke, past president, NIM; Michael Olawale-Cole, past president, NIM and Tony Fadaka, registrar/chief executive, NIM, at the 2018 Distinguished Management Lecture of the Institute held in Lagos.

16

BUSINESS DAY

C002D5556

Thursday 12 July 2018

Thursday 12 July 2018

BUSINESS DAY

C002D5556

Investor

17

In association with

Helping you to build wealth & make wise decisions NSE All Share Index

Year Open

38,243.19

Market capitalisation

N13.609 trillion

NSE Premium Index

The NSE-Main Board

NSE ASeM Index

2,564.13

1,713.69

1,087.32

Week open (22 – 06–18)

37,862.53

N13.716 trillion

2,707.98

1,691.04

949.59

Week close (29 – 06–18)

38,278.55

N13.866 trillion

2,720.42

1,719.17

949.59

Percentage change (WoW) Percentage change (YTD)

1.10 0.09

0.46 6.10

NSE Lotus II

NSE Ind. Goods Index

NSE Pension Index

330.69

2,560.39

1,975.59

1,379.74

149.45

903.41

2,553.17

1,956.40

1,481.73

927.72

323.22

2,626.59

2,008.70

1,490.07

NSE Banking Index

NSE Insurance Index NSE Consumer Goods Index NSE Oil/Gas Index

1,746.68

475.44

139.37

1,721.95 1,739.08

481.31

481.31

476.05

150.44

NSE 30 Index

1.66

0.00

0.99

0.32

-12.67

-0.44

-1.09 0.13

0.66 7.94

976.10

2.69 -4.96

-1.73

2.88

2.67

-2.26

2.59

1.68

0.56 8.00

Bancorp launches five H1’18 results to drive stock Capital initiatives for market positioning market performance C HEANYI NWACHUKWU

N

igerian stock investors are gradually taking positions in market bellwethers ahead ofthereleaseoftheir first-half (H1) financial scorecards. If corporateearningsturnflat,itwillforceshare prices further down.

While investors await the numbers, some have also routed to take advantage of bargain-hunting opportunities which recent dip created, offering attractive entry prices for value hunters.

Stock investors are particularly taking position in companies with robust interim dividend payment history, especially in bankingcounters.Preparatorytotherelease ofthehalf-yearnumbers,manycompanies –particularly the usual early birds have announced their closed periods to be followed by their board meetings.

Though on a minimal level, Nigerian equities had on Monday July 9 joined a global rally that began in Asia as investors continue to wave-off concerns about escalating election risks to focus on the coming H1’2018 earnings season.

Before now, Nigeria’s stock market remained unresponsive to oil price rally as the record bearish trend in first-half helped dismiss historical correlation between oil prices and equities.

Analysts’ view In his presentation at LBS executive breakfastmeetingonJuly4,2018,Bismarck Rewane, Chief Executive Officer (CEO), Financial Derivatives Company said firsthalf(H1)2018resultswilldriveperformance, even as he expects growing uncertainty and speculations to exert pressure on the bourse.”

“This week we expect investors to take advantageofbargainhuntingopportunities in some market bellwethers following their attractive entry prices”, said analysts at Lagos-based Afrinvest in their stock recommendation for the week. The analysts’ equity-watch list for the month of July remains Guaranty Trust Bank Plc, DangoteCementPlc,OkomuOilPalmPlc, ZenithBankPlcandNigerianBreweriesPlc. Lagos-based United Capital analysts in

their investment views expect investors to take position ahead of the first-half (H1)-18 earnings declaration.

Withmarketsentimentstayingnegative at the close of last week after a week of bearish trading, Vetiva Capital research analysts expected the tepid sentiment to filter into the market on the early trading days of this week.

Market review Market watchers observed how bears returned to the bourse last Friday after a spark of hope in Thursday’s session. The Nigerian Stock Exchange All-Share Index (ASI) depreciated by 1.71percent last week tocloseat37,625.59pointswhilethevalueof listed equities decreased to N13.630 trillion.

All other sectoral indices finished lower with the exception of the NSE Insurance Index that appreciated by 0.53percent.

Twenty-seven (27) equities appreciated in price during the review week, lower than 32 in the preceding week. Forty-five (45) equities depreciated in price, higher than 39 equities in the preceding week, while 97 equities remained unchanged lower than 98equitiesrecordedintheprecedingweek.

In 18,941 deals a total turnover of 1.842 billion shares worth N16.594 billion were traded last week by investors on the floor of the Exchange in contrast to a total of 2.004 billion shares valued at N21.582 billion that exchanged hands last week in 18,534 deals.

The Financial Services Industry (measured by volume) led the activity chart with 1.018 billion shares valued at N10.906 billion traded in 10,092 deals; thus contributing55.28percentand65.72percent to the total equity turnover volume and value respectively. The Services Industry followed with 313.481 million shares worth N1.861 billion in 782 deals. The third place wasoccupiedbyNaturalResourcesIndustry with a turnover of 304.922 million shares worth N61.366 million in 82 deals.

Trading in the Top Three Equities namely – United Bank for Africa Plc, Multiverse Mining and Exploration Plc and Nigerian Aviation Handling Company Plc (measured by volume) accounted for 912.300millionsharesworthN5.308billion in 1,025 deals, contributing 49.53percent and31.99percenttothetotalequityturnover volume and value respectively.

apital Bancorp Plc has launched five strategic initiatives to enhance investors’ seamless transaction in the Nigeria’s capital market and promote the federal government’s financial inclusion programme as part of its corporate brand positioning.

Besides, the frontline stockbroking firm has upgraded its Bancorp E-Trade in line with the rising demand of its teeming clients to enable them key in their mandates which go directly to The Nigerian Stock Exchange.

Addressing financial journalists in Lagos yesterday, the company’s Head, Stockbroking, Ayoola Opeyemi explained that technology drives the entire global financial market and Capital Barcop has leveraged its innovativeness to introduce five key initiatives in order to attract more investors into the capital market.

In her presentation, a staff in the Stockbroking Operations, Opeyemi Ojomu listed the initiatives as Upgraded Bancorp E-Trade, Online Account Opening, Bancorp Mobile, Live Chart and Self Service Desk.

Speaking on the Direct Market Access also known as be your own trader, Ojomu explained that it enables investors to take advantage of price volatility to purchase some stocks instantly.

“It is not uncommon that price volatility in the market makes investors unable to take advantage of some stocks instantly at their particular prices. With our upgraded Bancorp E-Trade, we have been able to solve this challenge for our clients.

The Direct Market Access allows clients to trade themselves without the intervention of the broker. They key in their mandates which go directly to the floor of The Nigerian Stock Exchange and mandates are executed immediately stocks are trading at clients’ limit.”, Ojomu said.

According to her, Market Watch serves as a guide in placing orders to enable investors view live trades, real time prices and total volumes of bid and offers on all stocks with their corresponding prices. Ojomu noted

that instant mail confirming success of the registration can be received instantly by mail while Log in details will be received within 24 hours.

“Bancorp Mobile is a secure trading application offering simple and hassle-free trading across NSE/ NASD equities at the click of a button.

Bancorp Mobile enables you to open an account, trade, track your stock position and view transactions anytime anywhere on a mobile friendly interface. Our Live Chat provides opportunity for instant response while the Self Service Desk enables clients that walk in to service themselves”, she said.

Ojomu explained that the Self Service Desk had been created to enable customers open account, place orders, check account balance, view portfolio holdings and valuation and view real time prices on Market Watch.

Speaking on security of the portal, the company’s Head, IT, Stephen Akande said that the technology had been designed in compatibility with Google Play to hedge against cyber fraud. Corroborating Akande, the Chief Compliance Officer, Olawale Oluwarinumi noted that the company had a robust Know Your Client (KYC) Policy which covers simple and enhanced categories. According to her, the company tracks all transactions and watches out for suspicious ones to ensure investors protection.

Commenting on the outlook for the stock market in the second half this year, Ayoola explained that the on-going bearish trend was partly due to reaction of foreign portfolio investors who are selling shares in anticipation of uncertain political atmosphere in Nigeria next year.

However, Ayoola expressed optimism that the second half would generate rally, especially, when quoted companies begin to release their results.

Capital Bancorp Plc has been operating in the Nigeria’s capital market for over three decades with outstanding track records in its operations covering Stockbroking, Issuing House, Financial Advisory, Investment Management and Proprietary Investment.

18

BUSINESS DAY

C002D5556

Thursday 12 July 2018

Investor

Helping you to build wealth & make wise decisions

United Capital investment views

Investor’s Square

Local bourse retreats to negative territory

…as NSE suspends 8 companies

I

n the trading week to July 6, the local bourse backtracked the weekly gains recorded in the preceding week as bearish streak recorded on four of five trading days led to a 1.7percent decline w e e k- o n - w e e k ( w / w ) .

Meanwhile, the NSE suspends 8 companies due to failure to submit necessary filings. Yeart o - d a t e ( Yt D ) r e t u r n sank to 1.6percent while ma rke t cap i t a l i s at i o n plunged N236.5billion to N13.6trillion. Activity levels were downbeat as average volume traded declined 8.1percent to 368.4million units while av e ra g e v a l u e t ra d e d depreciated 23.1percent to N3.3billion.

Performance across sector indices was mixed, however, with a tilt to the bearish side.

The Consumer G oods (-3.5percent), Oil & Gas (-2.3percent) and Industrial Goods ( - 1 . 9 p e rc e n t ) i n d i c e s trended southwards consequent on sell-offs in NESTLE (-4.8percent), NB (-2.7percent), FO (-19.8percent), MRS (-16.6percent), WA P C O ( - 4 . 8 p e rc e nt ) and DANGCEM (-1.8percent). The Agriculture (+0.4percent) and Financial Services (+1percent) indices gained w / w o n a p p re c i a t i o n in LIVESTO CK ( + 5 . 3 p e rc e nt ) , PRESCO (+0.7percent), WEMA (+2.7percent) and GUARANTY (+2.5percent).

Investors sentiment remained suppressed as market breadth edged to 0.6x (previously 0.8x); 25 stocks advanced while 39 declined. We expect investors to take position ahead of the first-half (H1)-18 earnings declaration.

Money Market : MM rates track the spate on liquidity flows System liquidity was relatively liquid, as money market rates averaged 17.1percent (Previous week: 25.2percent). The weeks’ liquidity profile was impacted by provisioning by banks for FX sales by the CBN and inflows f ro m O M O T- b i l l a n d PMA repayments. During the week, the Apex Bank conducted its bi-monthly Nigerian Treasury Bill (NTB) auction,

wherein it re-financed N40billion. Demand was underwhelming with a bid-to-cover ratio of 0.9x.

The auction was carried out at an average stop rate of 10.6percent. In terms of liquidity profile, N313.6billion maturing bills are expected to hit the system this week.

Yields : Liquidity delude guides sentiments in the T-bills space Last week saw a mixed market across the fixed income space. In the T-bill space, liquidity splurge from T-bill maturities and an absence of OMO auctions by the CBN, guided sentiments all through the week. In the bonds space, sentiments were guided by reduced offshore sell-off and increased local bargainhunting. Average T-bill yield inched lower by

The outlook of the naira remains tied to the spate of CBN’s inter vention in the spot and forward markets.

Global Market Review and Outlook In t h e U S, e q u i t i e s closed the week higher despite mixed signals in the holiday-shortened week. US labour department’s monthly employment summar y showed that 213,000 new jobs were created in June while previous months’ data were revised higher.

Also, unemployment rate rose 3.8percent in May to 4percent in June, largely due to new entr y into the labour force. Chicago PMI improved to 64.1 points in June, up from 62.7 points, the fastest reading since Januar y and the highest level in six months. How ever,

RSA fund price of PFAs as at June 29, 2018 S/N 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

PFAs CrusaderSterling Pensions Premium Pensions ARM Pension Mgrs.

Stanbic-IBTC Pensions Legacy PFA PAL Pensions NLPC PFA First Guarantee Pension Trustfund Pensions Leadway Pensure PFA SigmaVaughn Pensions AIICO Pension Managers APT Pensions Fidelity Pensions AXA Mansard FUG Pensions OAK Pensions Investment One Pension Mgrs.

IEI Anchor Pension Managers Radix Pension NPF Pensions

68bps w/w to close the week at 12.6percent (91-day (down 143bps to 11.4percent), 182-day (down 10bps to 13percent) and the 364-day (down 50bps to 13.4percent).

However, average bond yield inched higher by 22bps to end the week at 13.9percent. Generally, we believe sentiment in the FI space would be guided by inflation data that would be released this week.

Currency Market : Naira appreciates in the Parallel market In the Foreign exchange market, the n a i r a a p p re c i a t e d b y 28basis points (bps) and 2bps in the parallel and official market, to close the week at N360/$1 and N305.7/$1 respectively.

O n a n o t h e r n o t e, t h e Investors and & Exporters FX window/NAFEX, saw a 35bps downtrend to end the week at N362.6/$1.

CURRENT PRICE 3.9772 3.9642 3.8948 3.7400 3.6235 3.4402 3.4326 3.2923 3.2722 3.1362 3.1305 3.0404 2.7935 2.7339 2.7040 2.6439 2.5662 2.4726 2.3342 2.0344 1.4659

sentiments from trade remained tense as the US tariffs on $50.0bn worth of Chinese goods kicked off on Friday. Consequently, the DJIA (+0.8percent), S&P 500 (+1.5percent) and NASDAQ (+2.4percent) indices advanced w/w.

Major European equity indices also closed the w e e k l a rg e l y p o s i t i v e a s G e r m a n y ’s D A X (+1.5percent), France’s C AC ( + 1 p e rc e nt ) a n d Pan European STOXX (+0.6percent) trended northwards w/w while the UK’s FTSE declined 0.3percent w/w.

Emerging market indices were mixed a s B r a z i l ’s I B O V (+3.1percent), Russia’s RTSI (+1.7percent) a n d I n d i a’s S E N S E X (+0.7percent) advanced w/w. Expectedly, China’s SCHOMP (-3.5percent), and South Africa’s JALSH (-0.5percent) diminished w/w.

•Have you been shabbily treated by your registrar, stockbroke r or other capital market operators?

Let us know and investor will help you investigate and report back.

E-mail: iheanyi.nwachukwu@businessdayonline.com

Cordros weekly stock recommendation Cadbury Nigeria Plc – Sell he shares of Cadbury dropped by 5.38 percent to N12.30. Cadbur y trades at a significant forward price equity (PE) above its 5-year historical average of 24.9x.

CADBURY published Q118 result, showing EBIT was higher by 76.2% while PBT was lower by 67.2%, both compared to Q1-17. We are not surprised by the lower PBT, which we had expected will be impacted by higher finance charges (+233% y/y), given the sizeable balance of borrowings at the beginning of this year, compared to 2017. Meanwhile, the reported PBT missed our estimate by 49%, owing specifically to the deviation on finance income line (46% below our estimate), but we expect this will normalize in subsequent quarters.

Q1-18 revenue grew 2% y/y, consistent with our 1.8% growth estimate. Given base selling price is lower by marginal single-digit, we estimate flat to modest volume contraction must have been recorded during the just concluded quarter, compared to last year. Retaining our 8% revenue growth estimate for 2018E suggests we look for a faster growth in subsequent quarters, and will be largely volume-driven, on continued promotional activities, including price discounting.

We are aware of an ongoing buy-1-get-1 free promo for the 450g Bournvita Hot Chocolate Drink.

At 21.8%, CADBURY’s gross margin in Q1-18 is in line with our 21.9% estimate for the quarter, and 3 bps higher vs.

Q1-17. We had stated in our last note on the company that we do not expect gross margin will be above the 22.5% rate achieved in 2017FY, and this view is unchanged. Margin headwinds are selling price competition (on stronger imports) and rising cocoa prices, while the tailwinds are stable FX and soft sugar (-28% YtD) and dairy prices (-6% YtD).

The balance of short term borrowings was NGN4.3 billion, from the NGN3.6 billion at the beginning of the year. CADBURY’s loans are expensive (we estimated 22% at the end of 2017FY), and we are not aware that they are being refinanced through commercial papers in this period of generally declining interest rates. Finance cost in Q1-18 is in line with our estimate. Finance income was lower, but we expect this would increase and converge with our estimate for the year, as cash

T

grows following the payment of 2017FY dividend.

We m a i n t a i n T P a t NGN10.96. Our estimates are unchanged. On our estimates, CADBURY is trading at 2018F P/E multiple of 61.5x , a significant premium to the 5-year historical average of 31.1x.

Dangote Sugar Refinery Plc – Hold The shares of DANGSUGAR closed lower by 2.63% to NGN18.50. DANGSUGAR trades at forward PE of 7.0x, lower than its 5-year historical average of 7.5x.

DANGSUGAR published Q1-18 result, showing EPS grew 12% y/y but declined 59% q/q.

The EPS growth came on the back of a higher gross margin compared to last year’s one-off low, masking a disappointing revenue performance. Should we adjust Q1-17 gross margin to Q1-18’s 25% (which is also the average achieved in 2017FY), we have EPS of -55% y/y and -60% q/q.

According to management, Q1-18 sales volume was down 12% y/y (+2 q/q), despite selling price now lower by about 22% y/y. The volume outturn raises concern for 2018 revenue as a whole, given that the JanuaryMarch quarter (and indeed, the first half ) is seasonally strong for DANGSUGAR. On the 2017FY results call, management reiterated some of the volume concerns we had highlighted in previous notes – notably the activities of smugglers and the poor condition of the factory road – and added that the road to the North (accounting for 36% of revenue and where about the highest margin is derived) is equally deplorable, with negative impact on revenue.

Also of concern is that the NGN13,056/tonne average selling price computed by management in the latest result is way below the NGN14,000/ tonne price it said it was able to achieve during the last call held earlier this month. We have consequently revised our 2018E volume growth forecast to 5% (previously 9.5%) and cut average selling price estimate to NGN13,000/ tonne – while acknowledging that the possibility of price further reducing has increased with the poor volume outturn in Q1.

At 25%, the gross margin achieved in Q1-18 is about the 25.8% we estimated for 2018E. While noting that the downside risk to selling price, and consequently margin, has increased with this Q1 result, we should reiterate some tailwinds supporting our gross margin estimate as: (1)

better energy mix, (2) stable and stronger exchange rate, (3) stable outlook of global raw sugar prices, and (4) positive mix from growing contribution of higher margin Savannah.

We revise TP lower to NGN17.42 (previously NGN17.97). On our estimates, DANGSUGAR is trading at 2018F P/E and EV/EBITDA multiples of 7.6x and 4.x respectively, consistent with its five-year historical averages of 7.9x and 4.4x, but below the 14.3x and 9.4x Middle Eastern peer averages.

Flour Mills of Nigeria Plc – Under Review The shares of FLOURMILL fell by 4.06% to N30.70 .

FLOURMILL trades at 2018 PE of 4.9x, below its 5-year average of 19x.

FLO URMIL L releas e d Q4-18 and 2018FY results, which showed revenue grew by a marginal 3.5% while net profit increased by 54.1% over 2017FY numbers. Both were behind consensus estimates by 7% and 12% respectively.

For Q4-18, revenue was down 14.4% y/y and 10.8% q/q while net profit was lower by 76% y/y and 91% q/q.

Although Q4 contributes the least to FLOURMILL’s topline, we were quite surprised by the much lower outcome this year - wherein sales came short of our estimate by 7% - considering (1) the strong trajectory over 9M-18 and (2) that prices were lowered in December 2017 to support sales in 2018. We note the surprise 6% q/q decline in Food revenue (vs. our 20% growth estimate), which bucked the quarterly growth trend of the last two years. Compared to Q3-18 also, Agro-allied revenue was lower by 32%, but better than we expected, considering the company had reported negative numbers on this line in the last two years.

Q4-18 gross profit margin came in at 11.1%, about 484 bps lower q/q. The margin is the lowest in 2018FY. Management had informed us in March that it was well on course to achieve minimum 13% gross margin in 2018FY, despite the price cuts implemented late last year. The 12.67% margin achieved in 2018FY is below the 13.7% we estimated. On the COGS line, we observe a significant increase in rent/rates in Q4 compared to previous quarters. EBIT margin in Q4-18 stood at 3.7%, significantly lower than the 10.3% average achieved as at 9M-18. Gross opex margin rose to 7.8%, from 9M-18 average of 4.1% while other gains stood at NGN436 million, 96% lower y/y and below the NGN1.8 billion

Thursday 12 July 2018

C002D5556

BUSINESS DAY

Investor

19

Helping you to build wealth & make wise decisions

Facts behind the figures

Seplat: Investors are seeing the blue sky IHEANYI NWACHUKWU

T

he management team of Seplat Petroleum Development Company Plc has no doubt proven to stockbrokers, investment and research analysts as well as other capital market stakeholders that the company is really positioned to deliver long-term profitability, as well as capitalise on growth opportunities.

In a detailed “Facts Behind the Figures” presentation at the Nigerian Stock Exchange (NSE) on Tuesday July 10, 2018 by Austin Avuru, Chief Executive Officer (CEO), Seplat Petroleum Development Company Plc and its Chief Finance Officer, Roger Brow n, investors were made to know the company’s overriding focus on delivering sustainable returns to shareholders.

Seplat Petroleum Development Company Plc is a leading Nigerian independent oil and gas company listed on the Main Market of the London Stock Exchange (LSE) and the Premium Board of Nigerian Stock Exchange (NSE).

T h e c o m p a n y ’s current reinstated work programme is designed to star t captur ing the highest cash return opportunities.

T h e l e a d i n g independent Nigerian Oil and Gas Exploration and Production Company current well stock is producing strongly having had limited draw down during force majeure.

Average working interest production in Q1’2018 stood at 53,604 barrels of oil equivalent per day (boedp), a new quarterly record for Seplat against 20,922 boedp in Q1’2017.

Pro duction uptime in Q1’ 18 was 82p ercent ; average reconciliation losses was 7.3percent.

“Our biggest risk to operation is evacuation.

What we have done is t o m i t i g a t e t h i s. O u r primary export facility

L–R: Eleanor Adaralegbe, General Manager, Seplat Petroleum Development Company Plc; Jay Smulders, Technical Director, Seplat Petroleum Development Company Plc; Roger Brown, Chief Finance Officer (CFO), Seplat Petroleum Development Company Plc; Ms. Tinuade Awe, Executive Director, Regulation, The Nigerian Stock Exchange (NSE); Austin Avuru, Chief Executive Officer, Seplat Petroleum Development Company Plc; Effiong Okon, Operations Director, Seplat Petroleum Development Company Plc; Chioma Nwachukwu, General Manager External Affairs & Communications and Cyril Eigbogbo, Chief Finance Officer, NSE during a Facts Behind the Figures presentation at the Exchange recently.

remains TransForcado.

We have seen uninter r upte d grow th i n p ro d u c t i o n p ro f i l e from 2016 to Q1’2018,” Avuru told the capital market community while speaking on the c o m p a n y ’s w o r k i n g interest production and 2018 guidance.

Seplat is active in four oil assets which are: The OML 4, 38, and 41; OPL 283; OML 53; and OML 55. At the Nigerian bourse, Seplat share price which stood at N635 on Tuesday had reached a 52-week high of N769. With a market capitalisation in excess of N373.66billion, its shares outstanding are 588,444,561 units.

Seplat Petroleum Development Company Plc he said is prioritising the diversification of crude export routes to mitigate concentration r i s k i n t h e f u t u re. I n a d d i t i o n t o Fo rc a d o s Terminal, the completion of 160,000 barrels of oil per day (bopd) pipeline is a key priority to Seplat which has a funding agreement with partners and contractor executed

and pipeline tie-in to C h e v r o n ’s f a c i l i t i e s agreed.

Connection work at Amukpe commenced in January 2018 and Seplat will give guidance for its completion in this third-quarter (Q3), according to its CE O. Though the company anticipated the pipeline will be completed and fully commissioned in Q3 2018. As it planned in Q1’17, Seplat completed repair and upgrade of two jetties at its Warri Refinery Export Route.

The company, the CEO said has threeapproached outlook which includes to protect the core business in difficult conditions; now transitioning back into build and grow mode; and in line with i t s o u t l o o k o n f u t u re g ro w t h o p p o r t u n i t i e s to transform, Seplat is looking to leverage unique position and strong track record to access new production and development assets in the Niger Delta, become the largest supplier of process ed natural gas to the

domestic market, and position as the leading indigenous independent E&P company.

Currently, the company is a key supplier of gas to the d o m e s t i c m a rk e t a n d u n d e r p i n s s ig n i f i ca nt power generation.

“We are still a growth company. If t h e re a re a c q u i s i t i o n opportunities we have the cash to participate.

We believe that we have a primary responsibility to stakeholders where we operate – the shareholders, government, staff and community. The re c o g n i t i o n s o f t h e s e stakeholders have worked for us because w e b e l i e v e a nyo n e o f these stakeholders must feel a sense of accomplishment,” Avuru said.

“S eplat has already assumed very critical role in terms of delivering gas to the domestic market,” he added.

Currently, the upgraded jetties enable S e p l a t ’s s u s t a i n e d exports of 30,000 bopd (gross) if required in the

f u t u re, Av u r u a d d e d , noting that the company intends to keep the route open for the foreseeable future as back-up option.

The company is pursuing a Nigeria focused growth strategy and is well-positioned to participate in future divestment programmes by the international oil companies, farm-in opportunities and future licensing rounds.

Seplat made a good star t to 2018. Its core production base remains strong and predictable, the gas business has once again set a new record for its quarterly revenue contribution and the steps the company took to refinance the balance sheet have significantly strengthened its liquidity position and will allow investments to be scaled up.

Seplat debut bond issuance marks another ke y milestone for the Company, widening its long-term capital base in suppor t of its grow th strateg y while a l s o re d u c i n g ov e ra l l borrowing costs.

The company

manages its bottom-line in such a way that its remains profitable. The management emphasis has been to derisk and harvest cash flows. More i mp o r t a nt l y , i t s c o s tof-debt has come down remarkably.

I m p rov e d f i na n c i a l performance of S e p l at re f l e c t s s t ro ng production, cost efficiency and oil price tailwind.

In t h e f i r st- q u a r t e r (Q1) of 2018, Seplat reported un-audited revenue of N55.23billion as against N14.47billion i n t h e c o r re s p o n d i n g Q1 period of 2017.

Operating profit stood at N25.623billion against operating loss of N412million in Q1’17.

In the review Q1’18 period, Seplat profit before taxation (PBT ) stood at N17.98billion against N5.60billion loss before tax (LBT) in Q1’17.

Gross debt has declined from a high of $643million in Q1’17 to $550million in Q1’18.

Seplat successfully refinanced its balance sheet –proceeds to repay and cancel existing indebtedness.

P re v i o u s $ 3 0 0 m i l l i o n RFC refinanced with a n e w $ 3 0 0 m i l l i o n RC F due 2022.

Its debut $350million bond issuance diversifies capital base. No doubt, Seplat debt refinancing significantly strengthens its liquidity position and allows for work programme to be scaled up and focus switch t o d e l i v e r y o f g row t h strategy.

S e p l a t ’s s t ro n g operational and financial performance has resulted in the Board taking the decision to reinstate the dividend for its shareholders.

With its capital structure re s e t a n d ro b u s t f re e cash flow generation underpinning the business Seplat also h a s t h e h e a d ro o m t o capitalise on inorganic growth opportunities as and when they may arise, in line with its price disciplined approach.

20

BUSINESS DAY

C002D5556

Thursday 12 July 2018

INTERVIEW ‘Being a woman in a male dominated industry is both challenging and an opportunity’ MOYO OGUNSEINDE, Chief Operating Officer and Executive Director of Uraga, the pioneering company of Upbeat, an architect, designer, real estate developer, board member of both the Lagos State Sports Trust Fund and the Nigeria Gymnast Federation, revealed how her passion towards bringing alternative real estate has paid off and the challenges of being a woman in a male-dominated industry alongside the opportunities during her interview with Business Day’s ENDURANCE OKAFOR. Excerpt: ell me about yourself and what are you into?

As an architect and developer, I have had the privilege of seeing my creations come to realization; from the design and development of the Radisson Blu Anchorage Hotel, the conceptualization of a lifestyle brand, Aga Concept, to the creation and management of Upbeat Centre, the first trampoline park in west Africa whist working in Uraga Real Estate as an Executive Director. These are all snippets of what I do, however, I will define myself as a wife, mum, designer and an entrepreneur at heart.

and sponsorships of gymnastic competitions. My appointment has enabled me give back to the society by raising funds for facilities and centers to enable children and sports enthusiasts that do not have the opportunities that I have been exposed to, experience same.

What is the passion that led to the birth of Upbeat?

Statistically, Nigeria has a youth population of about 67 million, aged between 15 and 35 years, thus, a viable market exists for a recreation Centre like Upbeat Centre which is truly a one-of-a-kind development in West Africa.

Hence, In 2016, when the real estate sector witnessed a down turn, our observation of the increase in demand for fitness and wellbeing indicated a need to seize the opportunity to provide a unique fun and fitness Centre, essentially filling the gap in the community for a world class ground-breaking center that would engender fun, energy, innovation, excellence and safety in line with Upbeat’s brand values.

Upbeat Centre was conceived from the need toprovide alternative lifestyle spaces for the community that would positively impact and enhance the lives of families, Children and our community not just in Nigeria but all of west Africa.

We felt a need to redefine real estate beyond brick and mortar but also as an experience. This we translated by creating a profitable recreation and lifestyle space that is set apart from other exist-

What challenges have you encountered in the course of your journey so far?

Being a woman in a male dominated industry is both challenging and an opportunity. The challenge is that, you have to continuously prove that you are capable of actually delivering to the exact/better standard. However, there’s an opportunity to distinguish one’s self because when one delivers, it makes you stand out and you get a sense of accomplishment.

The most challenging experience is being able to harness and optimize the skills of the diverse people I manage, as there are different kinds of individuals, this however, is also most rewarding.

The ability to bring people together to achieve a common goal has been both challenging and inspiring.

T

How have you been able to climb up to the status that you hold now?

The strength and leverage comes from; one, a personal drive to succeed. This means that I am always striving for excellence. I got this far due to my personal purpose coupled with the fact that I have a trusted and dedicated team.

What keeps you going despite the challenges?

What keeps me going is my love for solving complex problems, problems that seem unsolvable to most people, by doing so I am able to teach and impact people’s lives. In my industry, I love to use my creativity and innovation to solve problems through real estate, through designing, and these skills help in achieving the purpose. ing recreation facilities in Nigeria and West Africa.

What has been the success level of Upbeat today?

We are so grateful that Upbeat has been received warmly by our customers as a community is slowly being created as we hoped will happen and it’s only the beginning. For instance, we have had a footfall of over 50,000 individuals, and enjoyed patronage from over 60 schools and corporate organization in the last six months. The feedback from our customers has been awesome. This keeps us excited and determined to improve their Upbeat experience at all times.

We believe our unique offerings, value proposition and strong affiliations with our customers are part of the reason for their loyalty to our brand. As such we have attracted a lot of endorsements, which came naturally on their own,

considering it’s a good platform for them to leverage on.

Upbeat is currently at the position of redefining what recreation is in Nigeria, as we have plans to spread across not just other states in Nigeria but West Africa as a whole.

Apart from you being an architect, designer and a real estate developer, is there any other thing you are into?

I am a member of the Lagos State Sports Trust Fund, (LSSTF), which was recently created by the Lagos state governor; Akinwumi Ambode. The board was created to basically support sports initiatives and the growth of sports in Lagos state.

I am also a board member of the Gymnastic Federation of Nigeria(GFN).

The passion came from my children’s love for sports coupled with my interest in sports. I have therefore, invested my time, energy and resources to support sports through platforms like Upbeat

How can the government assist you and the real estate sector as a whole?

The Government can assist by creating a more business enabling environment that will make doing operations more conducive.

In what way can the government empower the girl child so they can have the opportunity to achieve their dreams like you have?

I am grateful that the government has given me the opportunity to serve in the sports sector. I believe if other women are given such opportunities to have a platform to develop their own passion field they so desire to venture into, it will really make a big difference, especially when the most talented women are identified and given opportunities to mentor and guide other young women or girls so they have role models and understand that nothing is beyond their reach.

Thursday 12 July 2018

C002D5556

BUSINESS DAY

21

INTERVIEW

Before TCCF, we were already world-class – MDXI boss In this interview, Gbenga Adegbiji, the General Manager of MDXI Data Centres, a subsidiary of MainOne speaks on the company’s new Tier III Constructed Facility certification (TCCF) certification from the Uptime Institute and how this will improve the Nigerian economy. He also sheds light on the EU General Data Protection Regulation compliance and why Nigeria needs to implement a Data Domiciliation policy.

MDXI recently announced it has received its Tier III Constructed Facility certification (TCCF) from the Uptime Institute. Can you tell us about this? es, we have received our Tier III Constructed Facility certification (TCCF) from the Uptime Institute, the global professional certification body for data centres.

We received the certification following a performance-based evaluation of our data centre’s infrastructure, to test and ensure that every component of the infrastructure is concurrently maintainable and has been installed in accordance with the original certified design documents.

For us, because we have built the data centre in accordance with the certified Tier III designs ab-initio, the over 90 different tests and demonstrations validate what we have been doing in the last three years and achievement of the certification was very seamless.

Two major criteria for Tier III data center specification are redundancy and concurrent maintainability for all capacity and line equipment including power, cooling and distribution systems. We built the facility in line with the certified designed documents and in some cases, have provided more than what is required because of the understanding of the Nigerian operating environment. So because of this, we were initially not keen on re-certifying to the TCCF until our customers started requesting. For instance, we already invested significantly in power, with a direct private connection to the national grid through the Eko Electricity Distribution Company, ahead of TCCF. This was a capital investment of hundreds of millions of naira in substation equipment and dedicated power lines which bypass most of the ‘last-mile’ challenges encountered in electricity distribution in Nigeria.

We did this because we knew power alone is a differentiator in data centre (DC) operations and possibly the biggest albatross for DC operators.

With our direct connection to the national grid, we have an average of 22 hours of public power availability per day which translates to operational stability and cost savings for us and our customers.

Y

What does the TCCF mean to you and to your customers and what does it mean to Nigeria as a country?

Let me say it this way; it is an attestation to the fact we are able to continually provide uninterrupted data centre and cloud services to our customers in the face of planned and unplanned maintenance. It is

Gbenga Adegbiji

an endorsement of what we have already known and what we have been delivering since 2015 when we launched. Our facility was designed to these specifications. Our design documents were certified to the standards and our construction was purpose built in line with the approved documents and international best practices. Prior to the construction, we also went through numerous design audits to ensure alignment of all applicable international standards and best practices in all areas of the infrastructure. The TCCF is now a reassurance to our existing and prospecting customers that we will be able to deliver the services we promised them, come what may.

Also, when you add the TCCF to the other data centre certifications which we already have; for instance, the SAP Infrastructure Services license, which certifies that we can run SAP applications and infrastructure; the ISO 27001 which certifies us for information security compliance; the ISO 9001 that certifies us for Quality Management; and the PCI-DSS certification which places our data centre as the only colocation data centre in Nigeria that can securely process payment card information, you can see that we have done due diligence and ensured compliance with international benchmarks. Being compliant with PCI DSS means that we are doing our very best to keep customers valuable information safe and secure and out of the hands of people who could use that data in a fraudulent way. It is a global security standard for protecting card

data and was created by the world’s biggest card companies; Visa, MasterCard, American Express, Discover and JCB. Not sure any certification is as stringent and detailed as that for card chip data and we already have that. With these certifications and endorsements, MDXI has placed Nigeria on the world map of countries that are prepared for the digital economy and we are happy to be at the forefront of this.

Ahead of TCCF, MDXI’s performance and service delivery earned the company an Impact Award during the Presidential Enabling Business Environment Council (PEBEC) Impact Awards for moving Nigeria about 20 points up the ladder of “Ease of Doing Business” index through its colocation of critical server infrastructure for the Ease of Doing Business initiative!

The rise of data domiciliation policies globally is due to the increasing spate of cybercrime, cyberwarfare, hackers and the like

Now you have TCCF; what next?

Unparalleled service delivery to our customers, continuous process improvement and getting better and better in what we do. We will also extend our services across West Africa, providing the same world-class services to enterprises, governments and individuals across the region.

As you may know, we are currently building our Sagamu Data Centre, to boost ICT development in Ogun State and to serve as a disaster recovery option for our existing customers.

We will also announce the commencement of our Cote d’Ivoire data centre soon and Ghana should follow almost immediately. Like I said earlier, our objective is to enable the digital ecosystem in the region and we are strongly committed to this.

With the recent General Data Protection Regulation compliance and other data domiciliation trends, how do you think this can impact Nigeria?

The rise of data domiciliation policies globally is due to the increasing spate of cybercrime, cyberwarfare, hackers and the like. Data domiciliation is purely a preventative strategy to mitigate cyberattacks. Nigeria and Africa as a whole can be hugely affected because today, most of our critical data is hosted abroad. In Nigeria, for instance, a lot of our sensitive data such as our financial records, citizens’ information and telecoms data are currently not hosted here. In the wrong hands, access to this data is dangerous and makes us extremely

vulnerable to cyber-attacks. Those countries where we host our data will not allow their own data to be hosted outside their shores because they understand the security and economic implications of it. Now that Nigeria has world-class data centre facilities in-country, Government should as a matter of urgency, enforce the data domiciliation regulations to ensure we are all protected. I think the push by the lawmakers to enable Localization of Data and Operations by Telecoms firms in the country is in the interest of national security is a good start. More than ever, this will foster competitive practices with service quality and eventually price becoming the differentiator. With this policy, more companies will build data centres to serve the demand and this will eventually democratize colocation services. With new technologies such as block chain, cryptocurrency and the internet of things becoming the norm in Nigeria, specialized and edge data centres will evolve, new digital services will also emerge and further deepen the market. These will ultimately broaden the ecosystem and ultimately create more jobs and business opportunities in the country.

Talking about the next digital economy, what are the three top things you think the Nigerian Govenment should focus on?

We should continue to support data residency policies with Govenrment taking the lead with the MDAs and private sector. Government should also support indigenous players.

Sadly, it is only in Nigeria that you have to be advocating for this. Most of the other countries of the world (even some West Africa countries) have these protections entrenched in their laws and will not compromise it for anything. We should begin to emulate more developed countries including China, most countries in Europe etc that have data domiciliation laws. We must identify and host critical national data in-country. For example, before the Chinese government allows global players to operate in their country, they are mandated to either construct a manufacturing plant or employ 1000 local staff. They also encourage knowledge transfer and promote local companies who compete with global players. These are conscious efforts by the Government to promote their industries and develop their economy. This was the case with Alibaba, Wechat etc, some of which now have annual revenues that are more than the GDP of some countries. Nigerian Government should pay serious attention to these developments globally and ensure that best practices are adopted here.

22

BUSINESS DAY

Thursday 12 July 2018

FEATURE

Dousing the tension on foreign exchange pressure One of the takeaways from the Bankers committee meeting held recently was the assurance that the Central Bank of Nigeria (CBN) has enough arsenal to defend the naira, which further boosts investors’ confidence in the economy. Writes HOPE MOSES-ASHIKE.

T

he Central Bank and the Bankers Committee met recently to discuss issues around the economy, particularly as regards the mixed signals emanating from the global economy and the impact on the Nigerian economy.

Also considered was the impact of trade wars on the economy, the tax cut in the US and its expected effect on capital outflow from emerging economy like Nigeria.

Specifically, the U.S the Federal Reserve hiked its benchmark shortterm interest rate a quarter percentage point Wednesday and indicated that two more increases are likely this year. European Central Bank after its meeting on Thursday voted to stop its huge bond-buying programme, but interest rates will remain at record lows for a long time.

Manay analysts are of the view that the plan by the Federal Reserve to hike rates four times this year would put pressure on the currencies of the developing countries.

The analysts believe that this may lead to the cost of foreign borrowing by the Federal Government and corporates, as well as yield on fixed income securities rising.

“This monetary policy stance should cause the global yields to rise.

And the implication of this on the Nigerian economy is that domestic yields of fixed income securities may rise causing the Federal Government of Nigeria (FGN) and other corporates to borrow money in the domestic market at relatively higher interest rate than the current level.

In addition, the cost of borrowing for the FGN in the international market may rise. The implication of these developments is that the cost of borrowing for the government may rise”, Ayodele Akinwunmi , head of research, FSDH Merchant Bank Limited said.

Yields on government securities have been easing since September 2017, losing about 300 bps to April 2018 according to This Gbenga Sholotan, head of research, Rand Merchant Bank Nigeria Stockbrokers.

Nigeria’s macroeconomic indicators are beginning to take a slower growth, confirming the fragility of recovery from recession exited in the second quarter of 2017.

The headline Purchasing Managers’ Index (PMI) reading declined from 51.0 to 49.2 in May, its lowest since January last year, according to latest reading (no 62) of FBNQuest Capital, a subsidiary of FBN Holdings Plc regulated by the Securities and Exchange Commission in Nigeria

Godwin Emefiele

(SEC).

The PMI reading of the Central Bank of Nigeria (CBN) stood at 56.5 index points in the month of May, from 56.9 index point in April, indicating expansion (sluggish) in the sector for the fourteenth consecutive month.

“The slowing growth of the Nigerian economy and PMI data calls for concern as the delay in the passage of the 2018 budget may have compounded the situation. As long as the rate at which the economy grows continue to lag behind the population growth rate, the level of poverty would continue to rise”, said Ayodeji Ebo, managing director, Afrinvest Securities limited.

The Gross Domestic Product (GDP) declined to 1.9 percent in Q1 2018 from 2.11 perecnt in the last quarter of 2017, indicating a fragile growth occasioned by oil dependence.

Godwin Emefiele, governor of the CBN had noted at the last Monetray Policy Committee (MPC) that growth remains largely fragile and could benefit from further reforms and stimulus.

Nigeria’s external reserves are seen not growing and foreign exchange is under pressure, raising concern among stakeholders of the possibility of the country sliding into a second recession.

“If appropriate measures are not

To douse the tension of the foreign exchange users, investing public and other stakeholders, the CBN and the Bankers Committee after a meeting in Lagos last week said the CBN has enough arsenal to defend the naira and ensure that there is stable exchange rate

taken quickly, the economy may slip back into recession and this may lead to widespread loss of jobs with associated rising inflation rate”, said Akinwunmi.

To douse the tension of the foreign exchange users, investing public and other stakeholders, the CBN and the Bankers Committee after a meeting in Lagos last week said the CBN has enough arsenal to defend the naira and ensure that there is stable exchange rate.

To further boost investors confidence on the economy, Ahmed Abdullahi, director, banking supervision, CBN, said, “We recognise the positive outlook of the domestic economy – inflation coming down to 11.6 percent, reserves grown to $48 billion and the GDP estimated grow to 2.4 percent in 2018. Generally bankers committee recognise that the CBN has enough arsenal to ensure that we have stable exchange rate and that any demand for forex will be met to ensure liquidity in the forex market”.

However, at its last meeting in May 2018, the Monetary Policy Committee (MPC) welcomed the

continued stability in the foreign exchange market, promoted by improved dollar liquidity in the market due to the high level of activity at the Investors’ and Exporters’ (I&E) window, that is equally driving rates towards convergence at all segments of the market. Total foreign exchange inflow through the economy from January to March 2018 stood at US$24.719 billion, of which funding from the CBN was US$8.81 billion or 28.5 percent, while autonomous sources accounted for the larger balance of US$15.91 billion or 71.5 per cent of the total.

Another issue discussed by the Bankers Committee was US$2.5 billion or RMB 15 billion Currency Swap between the Central Bank of Nigeria (CBN) and the People’s Bank of China (PBoC).

The swap deal is expected ease pressure in the foreign exchange market by the reduction in reliance on a third currency for trade settlement between Nigeria and China.

The currency swap, which simply means an agreement to exchange currency between two foreign parties, will make it easier for most Nigerian manufacturers, especially small and medium enterprises (SMEs) and cottage industries in manufacturing and export businesses to import raw materials, spare-parts and simple machinery to undertake their businesses by taking advantage of available RMB liquidity from Nigerian banks without being exposed to the difficulties of seeking other scarce foreign currencies.

The deal, which is purely an exchange of currencies, will also make it easier for Chinese manufacturers seeking to buy raw materials from Nigeria to obtain enough Naira from banks in China to pay for their imports from Nigeria. Indeed, the deal will protect Nigerian business people from the harsh effects of third currency fluctuations.

In furtherance of the deal, the CBN and the Bankers Committee have agreed to offer 10 percent mark-up as an incentive to importers of machinery and equipment with Renminbi invoice.

Also, a percentage spread which is yet to be determined will be given to any importer that brings Renminbi invoice for settlement instead of a dollar invoice.

This implies that these importers will access foreign currency at a cheaper cost than the ones who have U.S dollar invoice and the idea according to the Bankers Committee is to encourage importers to receive invoices in Renminbi instead of dollar.

Thursday 12 July 2018

C002D5556

BUSINESS DAY

23

FEATURE

How Nigeria Obsolete laws continues to short-changed its oil revenue

The Nigerian National Petroleum Corporation (NNPC) places Nigeria as the largest oil and gas producer in Africa and the sixth largest in the world. Nigeria also ranks 16th on the US Energy Information Association’s table for Total Petroleum and Other Liquids Production 2017.in this write up DIPO OLADEHINDE exams the impact of obsolete laws in the revenue drive of the country.

W

ith the cur rent rate of oil price, Nigeria has no reason to succumb to the phenomenon called “Dutch Disease,” which has traditionally infected most natural resource dominated economies.

About fifty years after the Nigeria Petroleum Act 1969 was enacted, the country’s oil and gas industry is still running on laws that are no longer competitive and beneficial to the economy due to lackadaisical attitude of various arms of governments.

The Petroleum Act is the principal statute that governs petroleum operations, including exploration, production and use. It vests ownership and control of all petroleum exclusively in the government and the exercise of the powers consequent on this title in the minister of petroleum resources. Qualified persons wishing to carry out any form of petroleum operations can do so only on the basis of authorisation granted by the minister. The Petroleum Act and its subsidiary legislation, including the Petroleum (Drilling and Production) Regulations, the Petroleum Regulations and the Petroleum Refining Regulations, govern petroleum operations in Nigeria including, but not limited to, exploration, development, production, storage, transportation, refining and marketing.

The upstream oil sector is the single most important sector in the economy, accounting for over 90percent of the country’s exports and about 80percent of the Federal Government revenue as Crude Oil is currently produced from three different basins; the onshore Anambra, the offshore Benin/Dahomey (deepwater and ultra-deepwater) and the Niger Delta (shallow and deep offshore basins).

The Niger Delta and Benin basins are known to be the richest basins and hold the vast majority of reserves, and the source of a large portion of current production.

During the late 1990s, exploration focus turned to high risk ventures in the frontier basins of deep water offshore, with encouraging success. These ventures are becoming increasingly attractive, with developments in deepwater exploration and production technology.

According to the NNPC’s from January 2015 to December 2017 Nigeria has an average daily production of 69.88 million barrels per day(bpd) while total monthly gas production as at December 2017 stood at 234 million billion cubic feet (b.c.f.

Further Investigations into NNPC financials showed Production Sharing Contracts (PSCs) had the highest production with 44.87 percent of 954.34 million barrels produced over the three year period while Joint Ventures (JVs) came second with 31.35 percent

of 666.7 million barrels produced, while Alternative Financing (AFs) had the third highest production with 14.14 percent of 300.72 million barrels produced. Marginal Fields (Independents) was fourth highest with 4.52 percent production of 117.45 million barrels, while the Nigerian Petroleum Development Company (NPDC), the upstream company owned 100 percent by NNPC, had the lowest production of 87.43 million barrels contributing just 4.11 percent to total production.

The implication of this to the economy is that there will not be complete accountability for sure, and it would definitely affect the finances of the government, this is because if the country says it produces and for example two million barrels of oil daily, and what indeed gets to the market is less than what is supposedly produced, then we would definitely have an accounting problem, and this has always resulted in inaccuracy in the calculation of the actual revenue from oil and gas resources.

Not knowing the actual production and sales of crude oil leaves room for inaccuracies and easy exploitation of the gap created by the inaccuracies. What that also means is that certain people would be able to capitalise on this for personal benefit.

Adeola Adenikinju, gas policy analyst for the World Bank and professor of Economics at University of Ibadan said many oil producing countries are moving towards the PSC structure as it takes the pressure away from the government most especially the cash call obligations which Nigeria government have always been indebted to.

The PSC is a form of joint agreement for exploration, development and production of oil resources, makes extractive companies bear the cost of production, unlike the joint venture agreement where government is indebted with cash call.

As a result of the increasing funding pressure from the JVs, the Federal

Government adopted the PSC model in 1993 as the preferred petroleum arrangement with MOCs. Apart from awards restricted exclusively to indigenous companies, awards for upstream operations are now made on PSC basis. The first set of PSCs was signed in 1993, followed by those executed in 2001, after the 2000 licensing rounds “A lot of production activities have move towards deep offshore which was very attractive for PSCs since 2003; the idea was that as oil price goes up the contracts will be review however Nigeria government have failed to do so,” Adenikinju, professor of Economics at University of Ibadan said.

Under this arrangement, the concession is held by NNPC. NNPC engages the multinational oil company’s or the indigenous company as Contractor to conduct petroleum operations on behalf of itself and NNPC. The Contractor takes on the financing risk. If the exploration is successful, the Contractor is entitled to recover its costs on commencement of commercial production. If the operation is not successful, the Contractor bears the loss.

“The fiscal regime that underscores the administration of offshore activities were so generously drawn up for the PSC’s when oil prices were very low which is now currently out-dated allowing majority of the companies benefits from current higher oil prices than Nigeria itself,” Adenikinju told BusinessDay. The Deep Offshore and Inland Basin Production Sharing Contracts Act prescribes fiscal incentives for companies operating in the deep offshore and inland basin areas of Nigeria under production sharing contracts.

Adenikinju added, “The PIB will have being an opportunity to bring the system to international standard and make it more competitive which will benefit the government more.”

The PIB is an omnibus legislation

which seeks to regulate all activities in the Nigerian oil and gas industry; When passed into law, it will repeal the existing laws, which govern the industry, particularly the Petroleum Act of 1969, as amended, the Petroleum Profit Tax Act of 1990, as amended and the Nigerian National Petroleum Corporation Act of 1977.

Nigeria has been on a perpetual voyage with PIB which is one of its most important bills ever to be contemplated in Nigeria’s history in a journey that began sixteen years ago with a lot of anticipation and promises.

The bill is still stuttering through legislation after passing through four presidents, five presidential terms and five legislative tenures yet there are little or no results to show.

According to the agency mandated by law to promote transparency and accountability in the management of Nigeria’s oil and gas revenue, Nigeria Extractive Industries Transparency Initiative (NEITI) early last month declared that the old agreement used in computation of revenues to be shared between the government and oil companies is no longer acceptable, calling for urgent review despite earning $104.484 billion from oil between 2015 and 2017.

NEITI said the loopholes in the Deep Offshore and Inland Basin Production Sharing Agreement (PSC) between Nigeria and oil companies crippled the nation’s total share to $35.893 billion against the oil majors who earned about $68.591 billion.

“The fact that PSC productions now account for almost 50 percent of total oil production makes an urgent case for a review of the terms as stipulated by the Act,” NEITI said.

The agency noted that delay or failure to review and renew the agreement means that payment of royalty on oil production under PSCs would not be made while computation of taxes would be based on the old rates.

There is no doubt that the petroleum fiscal agreements (PFA) in

Nigeria are good enough to propel Nigeria’s economy to its full potential. A study published by scholars at Louisiana State University’s Center for Energy Studies, however, suggests that the type of contract offered is not as important as the design of the contract and the terms negotiated.

“The present worth of a project under PSC to an IOC is more sensitive to fluctuations in oil prices than it is for a JV’s projects. The sensitivity is, however, asymmetric with respect to decreasing or rising prices for both types of projects. The latter is also true for the present worth of the project for NOC. On the other hand, the present worth of a PSC project for the NOC is less sensitive to price variation than it is for a JVA project,” Center for Energy Studies, Louisiana State University’s said in its report.

Ademola Henry team leader at the Facility for Oil Sector Transformation (FOSTER) said the increase in PSCs is because onshore activities of joint venture are more prone to militants attacks compare to offshores where most PSC operates.

“Although, higher returns comes from PSC because yield determinations on equity is based on debt however Nigeria government can’t meet up to its cash call obligations any more from joint ventures as majority of its contracts and laws are also outdated,” Henry team leader at FOSTER told BusinessDay. Crude oil prices averaged $16.33 in 1993 and had risen to $17.44 by 1999 which was the last time efforts were made to amend the decree to reflect that if crude oil exceeds $20 to a barrel or after 15 years after the initial contracts were signed, the agreement should be renegotiated in a manner that will be favourable to Nigeria.

“There is an amendment act of PSC already with the national assembly which if amended will allow Nigeria benefit more from its oil,” Henry teamleader at FOSTER told BusinessDay. There are at least, four bills to amend the Deep Offshore and Inland Basin Production Sharing Contracts before the National Assembly.

The challenges facing the oil and gas industry in Nigeria may perhaps be quite difficult to resolve constructively without an amendment to the 1999 Constitution of Nigeria. The key elements of these challenges include resource ownership and the exclusive rights of the national government to grant the permission to explore and develop petroleum resources in Nigeria; effective, progressive petroleum fiscal systems; funding options for joint venture operations and the NOC; authentic indigenous participation in the domestic oil and gas industry; the rules of law and institutional empowerment.

24

BUSINESS DAY

Harvard Business Review

Thursday 12 July 2018

Global Business Perspectives CONNEC TING

THE

WORLD

ONE

BUSINESS

AT

A

TIME

Lyft and Uber won’t be happy until they’re Sales negotiation techniques your one-stop transit guide KATIE SHONK

U

ber and Lyft came to prominence with their ridehailing services.

But increasingly they’re betting on other modes of transportation — with the aim of becoming the only service people need to get around cities.

Lyft struck a deal on July 2 to buy the core parts of Motivate, the parent company of CitiBike in New York and seven other bike-sharing programs around the United States. At first, that acquisition may seem puzzling — why would a ride-hailing giant want to get into the far smaller market for bicycles?

— but there’s a bigger idea at work here.

While Uber and Lyft have raised tens of billions of dollars to change the way people travel in cars, the future of urban transport doesn’t revolve just around automobiles. Bikeshare programs have been popular in cities around the world for years. Shared electric scooters have become a huge business, as providers like Bird and Lime have gained in popularity. And millions of people still take buses or trains. (Some even still walk.)

Lyft and Uber are well aware that one doesn’t need to summon a driver to travel 10 blocks.

Lyft’s deal for Motivate follows Uber’s takeover of Jump, a company that rents dockless electric bikes in six American cities, including San Francisco and Chicago. And both companies are experimenting with their own scooter-sharing programs.

But they have bigger ambitions than just filling in gaps in their transportation networks.

They want people to use their apps for navigating around cities, period. Uber’s CEO, Dara Khosrowshahi, explicitly spelled this idea out earlier this year: “Whether it’s taking a car,

I

A Lyft driver operates in the Brooklyn borough of New York, July 25, 2014. The biggest game-changer from Uber and services of its kind may not be on the roads, but in offices, where the app-driven labor market could herald a sea change in how people work, and think about work. (CREDIT: Todd Heisler/The New York Times)

whether it’s taking a pooled car, whether it’s taking a bike, whether you should walk or even now we want to build out.

The capability for you to take a bus or subway. We want to be the A-to-B platform for transportation.”

There are already apps like Citymapper that help commuters figure out the best way to navigate between two points in a city. But Lyft and Uber have the advantage of actually running some of the transport networks that can be used to make those trips happen, and would like users to never leave their platforms.

One of the keys to making that dream a reality is linking their privately run businesses to public transit, something that both companies are working on.

Uber struck a partnership with the startup Masabi earlier this year to let users buy public-transit tickets through its app. That means that if the fastest way across town involves a car and a train, Uber could earn money from both parts of the trip.

It isn’t clear what Lyft’s

plans with Motivate are yet.

But the acquisition buys it relationships with eight U.S. cities that could prove helpful. And while many in Silicon Valley tout the benefits of the dockless bikes and scooters that Jump and Bird offer, Motivate’s bike docks are also useful real estate, providing central locations for bikes or scooters that tend to be around public transit hubs. That could make it easier for users to take public transportation and then switch over to a bike, all while staying in the Lyft system.

Of course, both companies face plenty of barriers. For one, while Lyft says it expects Motivate’s contracts with cities to roll over, that may not be guaranteed. And while Uber has worked to recast itself as a friendly partner to local governments, many may remain wary because of the past frictions with municipal regulators.

But becoming what Khosrowshahi has called the “Amazon for transportation” could be incredibly lucrative. That could keep a fight between Uber and Lyft going for years.

n sales negotiations, making the first offer is often a smart move. The first offer can anchor the discussion that follows and can have a powerful effect on the final outcome.

But if the other party makes the first offer, you’ll need to be prepared to frame your counteroffer carefully.

What is framing in negotiation? It involves crafting your offer to improve its appeal. When you frame your counteroffer with a strong rationale, you may increase your odds of re-anchoring the discussion. In this article, we present four effective sales negotiation techniques, beginning with framing your counteroffers for maximum advantage.

CHOOSE THE BEST RATIONALE Two common types of rationales in business negotiation are 1. constraint rationales and 2. disparagement rationales. A constraint rationale focuses on what’s holding you back from accepting the other side’s offer, such as not being able to afford what they’re asking. By contrast, a disparagement rationale critiques what the other party is offering, for example, by suggesting the quality is low.

In a recent study, researchers Alice J. Lee of Columbia Business School and Daniel R. Ames of Columbia University compared the effectiveness of these two types of rationales. They found that sellers were significantly more swayed by buyers’ constraint rationales than by their disparagement rationales. Why? First, the researchers note, sellers may view the criticism in a disparagement rationale as inaccurate and rude, and react by standing firm on price. Second, when buyers describe their financial constraints, sellers may take them at their word when they say they can’t afford the deal on the table.

Thus, when responding to a seller’s offer, a buyer is more likely to get a better deal if he accompanies his counteroffer with information about his financial constraints than if he tries to diminish the value of what’s being sold. Similarly, though this hasn’t been tested, a seller facing a buyer’s first offer may get a better deal if she says she can’t afford to go any lower than if she disparages the buyer’s best alternative to a negotiated agreement.

Here are several other effective negotiation skills for sales professionals.

1. HIGHLIGHT LOSSES RATHER THAN GAINS People are more motivated to avoid losses than they are to achieve gains, research by psychologists Amos Tver-

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

We have you covered through CBN’s special intervention for specified retail invisible transactions.

Are you travelling abroad for vacation

Visit any of our designated branches nationwide for your following invisible trade transactions: School Fees Pilgrimage & Other Travel Allowances (PTA and BTA) Medical Allowances

or studying abroad?

We are here to serve you. *Terms and conditions apply

www.firstbanknigeria.com

FirstBankofNigeria

@FirstBankngr

Firstbankngr

FirstBankofNigeriaLtd

@firstbanknigeria

+FirstBankNigeria

sky and Daniel Kahneman shows. For example, researchers at the University of Santa Cruz asked homeowners to participate in a free energy audit and then listen to a sales pitch for insulation products and services that would lower their energy costs. When the insulation was pitched as a way to avoid losing money, homeowners were significantly more likely to purchase it than when it was pitched as a way to save money. Because losses weigh heavily on our minds, framing the exact same price as a loss likely will have a greater effect than framing it as a gain, write Deepak Malhotra and Max H. Bazerman in their book “Negotiation Genius.”

2. SPLIT UP LOSSES; COMBINE GAINS Tversky and Kahneman also discovered in their research that people prefer to gain money in installments but to lose money in one lump sum.

For example, most people would prefer to find a $10 bill two days in a row ($20 total) than to find a $20 bill once.

Conversely, most people would prefer to lose a $20 bill than to lose a $10 bill two days in a row. Thus, in the process of business negotiation, when making a price concession, it can be smart to divide it into two or more smaller concessions. But when asking for a concession on price, make one demand rather than two or more partial demands, recommend Malhotra and Bazerman.

3. AVOID OVERJUSTIFYING A well-known 1978 psychology experiment by Ellen Langer, Arthur Blank and Benzion Chanowitz suggested that even a lame justification for a first offer can be more effective than none at all. In the study, an experimenter who tried to cut in line to use a copier to make five copies was far more successful using the rather weak justification “May I use the Xerox machine, because I have to make some copies?” than when giving no justification at all for cutting in (“May I use the Xerox machine?”). But in a 2011 paper, Tel Aviv University researchers Yossi Maaravi, Yoav Ganzach and Asya Pazy noted that people tend to rebel against more significant requests with weak justifications. And in their research, they found that when a justification for an offer is easy to counter, it can inspire a backlash. So, for example, if you are a salesperson who has already shown off the many attractive features of your product, you can let your first price offer stand on its own.

Katie Shonk is the editor of the Program on Negotiation at Harvard Law School.

Innovation

Apps

Fin-Tech

Start-up

Gadgets

Ecommerce

IOTs

Broadband Infrastructure

Bank IT Security

BUSINESS DAY

Thursday 12 July 2018

25

Why 25% of internet users in Nigeria block ads FRANK ELEANYA

O

nline advertisements (ads) are getting the cold shoulder by only 25 percent of online users in Nigeria, according to new report released in July by Globalwebindex.

Ad blocking in Middle East and Africa (MEA) generally is seen to be lagging behind other regions of the world like South East Asia, North America and New Zealand.

This is despite having a largely mobile-first or mobile-only internet users’ population.

Other African countries with lesser numbers include Morocco (15%); Ghana (21%); and Kenya (27%).

Internet users in Indonesia are the most notorious for blocking online ads, with more than half (53%) likely to do so. China and the United States have 49 percent and 43 percent users blocking ads.

The report suggests that online users that are blocking ads in regions outside

Africa may have mobile capabilities and tools ahead of that available elsewhere.

There are several reasons users block ads online. The most concern for users is too many ads. 48 percent of respondents said they are simply turned off by the

interference of too many ads. About 47 percent complained that too many ads become annoying or irrelevant. 44 percent said ads are too intrusive. 39 percent think ads contain viruses or bugs. 37 percent do not like it when ads take up too much

M

ore than 80 percent of chief executive officers of technology companies say they are worried of not finding the right talents to hire.

PricewaterhouseCoopers (PwC)’s 21st CEO Survey titled “The Talent Challenge: Rebalancing skills for the digital age” showed that although more executives are optimistic about the prospects for growth, they face daunting threats in terms of talent recruitment.

“People strategy weighs heavily on CEO’s minds,” wrote Carol Stubbings,

Global Leader, People and Organisation for PwC. “If businesses are to attract the workers they need – concern about the availability of skills has never been higher – to deliver the best possible performance and productivity from their organisation, they need to have trust on their side.

The digital era has ushered in new ways of doing things. There is more relationship to customer relations than there was in the past. Satisfaction has also taking on a new meaning in view of various technological innovations and the customer environment is moving constantly to many virtual places than most

55-64s (62%),” the report authors noted. These concerns are buttressed by a research carried out by Ad Lightning, which found that 4 in 10 online ads are oversized.

In a bid to save data allowance, young internet users in mobile-first markets

New drone invention could help Nigeria maintain roads

Two-third tech CEOs worry about hiring key skills FRANK ELEANYA

screen space and 33 percent said they simply want to speed up page loading times.

“Ad-frustration, whether from annoyance with ads or a feeling that they are excessive, is the most popular motivation to block in age groups, peaking from the

could use ad-blockers.

The report recommends personalised and relevant advertising as an effective way to reach ad-blocker users. However, any strategy must consider that there may be greater resistance among older users.

Internet users globally block ads more (37%) on laptops and PCs compared to mobile phones (32%). In Middle East and Africa, 37 percent block ads on laptops and PCs while 34 percent block ads on smartphones.

The report predicts that mobile ad-blocking will soon catch up with laptops and PCs as more online activities migrate to smartphones.

“Ad-blocker users in all regions tend to be blocking across multiple devices,” the report stated. “An internet user may be able to see an ad on their mobile which they would otherwise have missed on their PC, but addressing the root cause of user discontent is likely to be more effective than trying to target users with frustrating ads in a different place.”

JONATHAN ADEROJU

businesses have been to.

Tech trends such as artificial intelligence (AI) and automation have redefined efficiency, productivity and profitability. Companies are forced to restrategise and find the balance between business opportunities and the inevitable impact on jobs and trust.

I n t e re s t i n g l y , t h e s e sweeping transformations is not leading to job losses instead most CEOs organisations in different geographical locations are recognising the need to increase the size of the workforce.

The Survey showed that 72 percent of CEOs in China and 61 percent in North America expect to increase their headcount. Only 31 percent of CEOs in Africa expect to do the same and 28 percent of CEOs believe headcount will drop.

The biggest challenge for the CEOs remains hiring people with the right skills.

PwC predicts that it will become even more challenging as business models evolve. 91 percent of CEOs agree that they need soft skills to sit alongside digital skills.

P

ortholes have been a night mare for motorists in Nigeria, and a major headache for government at different tiers, but a new drone technology is offering some hope.

Nigeria may now benefit from a new research at the University of Leeds, UK, where a drone that is capable of detecting and filling cracks in the road is has been developed.

They hope to have the drones available for deployment in a few years, slashing road maintenance costs and the number of potholes on roads in the process.

In Nigeria’s 2018 budget, about N300 billion was set aside for the construction and rehabilitation of strategic roads. The Federal Road Maintenance Agency (FERMA) is the preeminent road maintenance agency in the country, with a commitment to efficiently administer road maintenance and to keep all federal roads in good, safe and comfortable condition with the best value in road transport. But so far, results have been far from impressive.

Nigeria has about 36,000 kilometres of federal road across the country, and many more in states. But out of the 36,000 kilometres of road, between 2,000-5,000 are often under contract with the Ministry of Works

and therefore have contractors responsible for these roads.

Constraints that delay the roads from being completed range from late disbursement of mobilization fees to other technical difficulties.

With the introduction of this drone technology, it is expected to eliminate the need for heavy machinery and manpower currently used in road repairs, hence, reduce inconvenience as roads wouldn’t have to be closed for so long.

According to Robert C. Richardson, a professor at the University of Leeds’ School of Mechanical Engineering “We are not talking about repairing very large potholes, like half-ametre potholes,” At the moment, the drone can fill in a “reasonable amount of cracks” with a 3-D printed substance.

Richardson also said that “we can add different things in the mix vary the property of the filling and make a better fit.”

“The way potholes work is that there’s a mismatch between how strong the material you put in the ground is and the asphalt road. As the ground surrounding (the road) vibrates in a different way, it can disrupt.”

“If you can fill (cracks and potholes) not just with a neat, clean path but change the properties of the material deposited, the road becomes much more resilient to dam-

Team: Frank Eleanya, frank.eleanya@businessdayonline.com; Caleb Ojewale, caleb.ojewale@businessdayonline.com

age,” Richardson explained.

The Researchers hope to deploy the drone to some specific sites across the UK for testing within the next couple of years and for its use to be democratised by 2025.

Richardson further said that “If you can repair small or medium=sized cracks before they turn into potholes, they will never become potholes.

“It’s a very proactive situation,” he said, especially given that in the UK, “the rate of potholes appearing is greater than them being repaired. So it’s a losing battle.”

On the other hand some researchers and Scientists at the ETH Zurich, are also looking for new ways to tackle this problem, they are working on a self-healing road.

They found that adding iron oxide nanoparticles to bitumen gives the sticky, black, substance self-healing qualities.

Although the healing properties will need to be activated once a year with an electromagnetic field.

This could be a good development for Nigeria to buy into the innovation so as to better maintain the roads and bring joy to millions of motorists in the country in nearest future.

It can also reduce the cost of maintaining roads yearly, and instead, the monies can be diverted to other sectors so as to improve them.

26

BUSINESS DAY

Luxury

Malls

Companies

Deals

C002D5556

Thursday 12 July 2018

Spending Trends

How car companies are blasting Trump’s import investigation …manufacturers, parts makers warn of job cuts, big cost burden …administration is said to be considering tariffs of up to 25%

T

wo words sum up how auto companies are portraying the future if the Trump administration determines that car imports are a national security threat and slaps imported vehicles and parts with tariffs: doom and gloom.

The U.S. Commerce Department started conducting the investigation in late May at the behest of President Donald Trump, whose administration is said to be considering tariffs of as much as 25 percent.

More than 2,300 comments have been submitted to Commerce ahead of hearings scheduled for July 19 and 20. Here’s a selection of submissions from some of the world’s biggest car and parts manufacturers: General motors Has 47 manufacturing facilities and employs about 110,000 in the U.S. Invested more than $22 billion in domestic manufacturing operations since 2009, and conducts most of its R&D, design, engineering, vehicle testing, information technology,

purchasing, finance, marketing and other business operations in the U.S. Says tariffs “could lead to a smaller GM” and risks resulting in “less -- not more -- U.S. jobs” by increasing costs and spurring retaliation by countries that could hurt the company in other markets Ford, Flat Chrysler On behalf of members GM, Ford and Fiat Chrysler, the American Automotive Policy Council says any increase in U.S. tariffs on cars, trucks and parts will undermine the companies’ economic contributions to the country Estimates a 25 percent levy would be an $83 billion tax burden for the U.S. auto industry and consumers.

Has 10 manufacturing plants and an eleventh being constructed soon with Mazda Motor Corp. that directly or indirectly employs 137,000 people Has invested almost $25 billion in the U.S. to design, engineering, manufacture and sell Toyota and Mazda vehicles Says a 25 percent tariff on imported vehicles and parts would raise the price

even of the Kentucky-built Camry sedan -- the topselling car in America -- by about $1,800 Nissan Has invested $11.8 billion in U.S. manufacturing, employs 22,000 directly and boasts the country’s biggest vehicle production facility, in Tennessee “Given the breadth and health of our operations here in the United States, we could easily meet the

U.S. military’s requirements without the need to restrict importation of either automobiles or auto parts” BMW Has invested almost $9 billion in its South Carolina plant and is also the only manufacturer that produces more cars than it sells in the U.S. Higher tariffs on imported parts will increase costs of building cars in the U.S., potentially leading to

“strongly reduced” export volumes, a negative effect on investment and employment that could more than offset “forced” localization of production to supply products to the market Daimler Employs more than 24,000 in the U.S. across operations including its Mercedes-Benz passenger vehicle and van businesses, financial services unit and research-and-development

analysts are recommending for Nordstrom after its failed attempt to go private.

War on plastic Starbucks has become the latest retailer to turn its back on plastics and has vowed to eliminate all plastic straws by 2020. Commentators are considering the impact this may have on disabled people, for whom the straw was originally devised, as well as the overall impact on the environment.

Prolific pairings in Asia Alibaba is in talks with a host of companies to de-

velop beneficial partnerships. Siemens has signed a dealto use the online giant’s cloud infrastructure for a rollout of its own tech, while telecoms major BT is in talks with Alibaba for a possible cloud services partnership in Europe. Finally, Starbucks’ departing executive chairman has hinted at a possible relationship with Jack Ma. Hero for a day A new action-packed Mar vel Experience has opened inside a Bangkok mall and its offerings are

sure to wow even the most hardcore superhero fans.

Guest experiences include: battle mock-ups, virtual reality simulations, and a meet and greet with heroes. Click here to see images of the impressive set-up.

Weighty criticism in America Amazon has been criticised for allowing its platforms to be used to spread white supremacy. Click here to see images of the questionable items permitted for sale. Meanwhile, the multibillion-dollar company is also coming under fire for its strong anti-union stance that is leading many to question working conditions and remuneration for employees.

Drugstore deal Walgreens Boots alliance has completed its agreement to acquire a 40% minority stake in leading Chinese pharmacy chain Sinopharm Holding GuoDa Drugstores.

The acquisition costs USD 416 million.

Empowering decision

operation “New tariffs on imported parts will result in a reduction of vehicles being produced in Alabama. Lower production volumes will result in fewer shifts with fewer U.S. employees” Volkswagen Employs about 3,500 at plant in Tennessee and directly supports almost 50,000 U.S. jobs The company “does not see how continuing imports of automobiles and automotive parts at current levels could impair U.S. national security” and says that “this proposition -supported by no U.S. motor vehicle manufacturer -- is implausible” Hyundai Em p l oy s m o re t ha n 25,000 workers and has invested almost $8.3 billion in the U.S., with another 47,000 employed at dealerships Says duties would be “devastating” and could jeopardize its plans to expand manufacturing in the U.S., plus hurt Trump’s effort to halt North Korea’s nuclear ambitions.

Culled from Bloomberg

Global Retail Update Great gains in Europe ldi and Lidl continue to prosper in Britain at the expense of the Big Four. They each rose their market share to 7.4% and 5.4% respectively. In Australia,Aldi has outperfor me d local competitorsColes and Woolworths to take the title as Australia’s most trusted brand.

Tough times Embattled UK maternity retailer Mothercare is closing an additional 10 stores as part of its survival plan to stay afloat and has placed its Children’s World division into administration. Meanwhile, struggling convenience chainCostcutter has snubbed a GBP 15 million takeover bid from Co-op.

Named and shamed Liverpool-based Home Bargains has been exposed by the British government for underpaying its staff and will now be forced to provide backpay for affected employees, as well as face possible

A

fines of up to GBP 20,000 per worker.

Fashion and function Asos is being inundated with praise following the release of a wheelchair-friendly jumpsuit.The online fashion retailer collaborated with British Paralympian Chloe Ball-Hopkins for the design of the waterproof jumpsuit, which retails for GBP 50.

Secret code in America Hidden code buried deep within the social media Snapchat app reveals an unreleased visual search feature is being built for Amazon.

While the exact purpose of the collaboration is uncertain, it seems likely that users will be able to take photos of objects or barcodes and see similar results available for purchase on Amazon.

New beginnings Nordstrom is set to open smaller stores with no inventory,focusing instead on experience and service through offerings such as a nail salon and a wine bar.

Meanwhile, check out what

Walmart has shown its support of diverse suppliers by launching a ‘Supplier Inclusion Showcase’ on its website, to highlight companies operated by ethnic minorities, women, gay and lesbian people and people with disabilities.

Positive progress Etsy has turned its fortunes around and its shares have tripled in the space of a year. The e-tailer, known for its vintage and handmade goods, credits its transformation with a change in management and more competitive strategies.

Possible pairing Austria-based Signa and Canada’s Hudson’s Bay have signed a non-binding letter of intent to explore a possible joint venture. Separately, the companies operate Germany’s two major department stores Kaufhof and Karstadt, and there are whisperings of a potential merger on the cards.

Compiled by Chinwe Agbeze

Thursday 12 July 2018

C002D5556

BUSINESS DAY

27

Nigeria’s internet penetration rides on used phones market to expand BUNMI BAILEY

N

i g e r i a’s u s e d p h o n e s m a rket is filling the gap created by a shrinking middle class, weakening purchasing power and growing need to stay connected on social media; this is indirectly enhancing internet penetration.

Used phones, especially the United Kingdom (UK) used variant appears like the smarter decision to make.

According to Jumia mobile report 2018, there is a growing market for secondhand devices which is a major contributing factor to the increase in mobile phone penetration to 84 percent in 2017 from 53 percent in 2016.

“I sell more of second hand phones. Most of the people that buy them are all these secondary school students and university students that want to show off to their friends. I try to be careful whenever I purchase Nigerian used phone because some of them might be stolen,” Eze Emele, CEO, Oweh online store said during a conversation with BusinessDay London-used phones have gained wide spread acceptance in the Nigerian market as a majority of budget buyers tend to prefer

them to not just brand new items but other fairly-used items. It is believed that these fairly used phones from London are affordable, very durable and can perform as well as brand new. Surely, a London-used smartphone can serve you.

There is no way of knowing the exact price of London used phones because the price varies among sellers, but this list will give you an idea of how much you should pay for each device.

BusinessDay did an analysis of the price ranges between N4, 000-N50,000 of London used phones

from popular store known as Affordables and an online store known as OLX Nigeria .Note that these are phones that are currently available in the stores and they are negotiable.

Blackberry 9780 (Bold 3) succeeds the previous Blackberry 9700 (Bold 2). It looks similar to its predecessor, but comes with 5 megapixel camera, 512MB RAM and runs on the BlackBerry OS6. The rest of the specs are pretty much the same – HVGA display, full QWERTY keyboard, an optical trackpad, Wi-Fi, 3G with HSDPA, GPS and microSD card slot.

It is priced N3,000-N4,000.

BlackBerry (Bold 5 9900) comes with a 2.8inch capacitive touch screen and a magnificent resolution for its size 640x480. It is a quad-band GSM/GPRS/EDGE handset, and also supports a triband HSPA. This device also sports a 5MP camera, 768MB of RAM and a 8GB build-in memory. Its price ranges between N4, 000N9, 000 BlackBerry (Bold 6 9780) smartphone was launched in November 2010. The phone comes with a 2.44inch display with a resolu-

tion of 360 pixels by 480 pixels at a PPI of 246 pixels per inch.

It is powered by 624 MHz processor and it comes with 512MB of RAM. The phone packs 512MB of internal storage that can be expanded up to 32GB via a microSD card. As far as the cameras are concerned, the BlackBerry Bold 9780 packs a 5-megapixel primary camera on the rear. It is currently priced N4, 500-N5,000 Tecno W1 is part of the W series. It has a Dual SIM (Min-SIM), Display 4.0” WVGA touchscreen ,Resolution 480 x 800 pixels, Android OS,v7.0 (Nougat) ,Processor Quad-core 1.3 GHz Cortex-A53 Internal memory 8 GB /1 GB RAM, Camera 2MP/0.3MP, Li-ion 1800 mAh battery and the Colors are usually available in Black and Gray.it is priced N9,000-N13,000 Everything about the Tecno W2 is modest. It is a bare-bone smartphone for the entry level audience.

The 4.5-inch display has 480 x 854 pixels resolution. It has a 2 megapixels rear facing camera and a 0.3 megapixels front facing camera.

It r uns Android 6.0 (Marshmallow) on a 1.3GHz quad-core processor with 1GB RAM. It has just 8GB built-in storage, but you can add a memory card of up to 32GB. Tecno W2 has a 2500 mAh battery and it is priced between N10, 000-N16,000

Samsung galaxy S3 mobile features a 4.8” (12.19 cm) display with a screen resolution of HD (720 x 1280 pixels) and runs on Android v4.0.4 (Ice Cream Sandwich) operating system.

The device is powered by Quad core, 1.4 GHz, Cortex A9 processor paired with 1 GB of RAM. As far as the battery is concerned it has 2100 mAh. This mobile has a 8 MP camera Backilluminated sensor (BSI), CMOS image sensor supporting a resolution of 3264 x 2448 Pixels and the front snapper is powered by a Back-illuminated sensor (BSI), CMOS image sensor.

Its price ranges between N17, 000-N25, 000 The Samsung Galaxy Express 3 features a 4.5 inch Super AMOLED display, 1.3GHz quad-core processor, 1GB of RAM and 8 gigs of internal, expandable storage. There is 5 megapixel camera on the back, as well as 2 megapixel front shooter.

The phone is powered by 2050mAh battery and runs Android 6.0. It is priced N15, 000-N20, 000 “It is very important to take note of the reseller or the phone dealer and how the phone looks because it might be overused or stolen, always ask for a warranty and obtain a valid receipt, Look for original casing and check the manufacturer and maker of the phone,” Emele warned

Osun, Construction Company enters PPP agreement to run material testing laboratory BOLADALE BAMIGBOLA.

T

he management of an indigenous construction company, S. Makintosh Nig. Ltd, has entered into partnership with Osun state government to run a civil engineering materials testing laboratory belonging to it.

Announcing the new arrangement for the running of the laboratory during the signing of Memorandum of Understanding (MoU), in Osogbo, the Managing Director of the company, Mr. Shola Abel Famakin, said the new arrangement is at no extra cost to the state government.

He added that the services the company will ren-

der will provide the much needed awareness, employment, revenue generation and development of the

state infrastructure.

According to him, the benefits inherent in the new partnership include;

improvement in service delivery in the state and beyond by reducing incidence of structural failures which

usually result to collapse of buildings, roads and infrastructural facilities.

Famakin further noted that the partnership will generate additional income for the state and also create job opportunities for its people.

He commended Osun state governor, Mr. Rauf Aregbesola, for the enactment of law that established the Civil Engineering Materials Testing Laboratory.

Responding, the state’s Commissioner for Works, Engr. Kazeem Salami, said government entered into the partnership to boost the state’s revenue.

He explained that Governor Aregbesola has approved the MoU for the joint operation and management of the Materials Testing

Analysts: Chinwe Agbeze, Stephen Onyekwelu, David Ibemere, Graphics: Fifen Famous

Laboratory between Osun government and Messers S. Makintosh Nig Ltd, saying the development was another milestone achievement towards reduction of incidence of structural failure.

Salami further posited that: “The consultant will provide modern additional laboratory equipments at zero cost to the government and those equipment will be transferred wholly to the government at the expiration of the MoU.” He added: “The MoU shall run for a period of (5) years, subject to renewal approved in writing by the government. The percentage of revenue accrued to the state government shall be remitted to the state treasury every month.”

28

BUSINESS DAY

C002D5556

Thursday 12 July 2018

TAL deepens competition in support services with acquisition of six AW139 helicopters Stories by IFEOMA OKEKE

A

start-up Helicopter support services, Tropical Arctic Logistics Limited (TAL) has deepened competition in the sector with the launch of six fleet AW139 helicopter and a Challenger fixed business executive jet.

Emperor Chris Baywood Ibe, President and Chief Executive, TAL, disclosed that each of the helicopters costs $35 million, bringing the total investment on the six aircraft to$410 million.

Ibe added that the firm would consider scheduled operations in no distant future with the right type of equipment, attributing the challenges faced by many of the operators in Nigeria to the use of wrong aircraft type.

To him, TAL is a game-changer and has made massive investments in all key sectors of our operations in order to sharpen our competitive edge.

“We have therefore, positioned our company for leadership in this sector, an unparalleled feat for a company founded just five years ago”.

The AW139 helicopter we have acquired is state-of-the-art and designed for safety and efficiency to service customer demand.

According to him, “Tropical Arc-

L-R: Emperor Chris Baywood Ibe, president/CEO Tropical Arctic Logistics Ltd.; Odein Ajumogobia, chairman of the Company; Femi Adeniji, chief operating officer, and Reinoud Klinkhamer, during the commissioning and launching ceremony of Newly Aquired AW 139 Helicopter for offshore services held at EAN Jet Centre Hanger, MM Internaional Airport, Ikeja Lagos.

tic Logistics, a Baywood company, was established in 2013 to provide professional solutions with particular emphasis on safety and efficiency.

Our helicopter company offers business-beneficial services to the Oil and Gas industry, Executive Spot Charter, Banking Industry, Medical Emergency Evacuation (MEDVAC) and allied services as well as executive private aircraft charter.

“We are considering starting

scheduled service operations. But we are going to use the right aircraft types and not B737 that airlines are using. It makes no sense operating B737 for 50 minute flight.”

He further disclosed that the company’s operational safety policy both onshore and offshore is one of the key attributes which will achieve tremendous resonance among stakeholders.

“This is one of the reasons why

FAAN unveils PEBEC feedback app at MMIA

T

he Federal Airports Authority of Nigeria, (FAAN) has unveiled an application, initiated by the Presidential Enabling Business Environment Council (PEBEC) for service users to give feedback about the quality of services being rendered by government agencies at the nation’s airports.

The commissioning of the APP was held at the E - Arrival of the Murtala Muhammed International Airport, Lagos today, June 6, 2018.

With this initiative, passengers and the general public can now register their complaints or commend the quality of services being rendered by government agencies at the airports, with the assurance that such complaints will be attended to and resolved within 72hours, in line with the provisions of Executive Order 1 of the Federal Government of Nigeria.

In her speech, the Jumoke Oduwole, Senior Special Assistant to the President on Industry, Trade and Investment, who commissioned the PEBEC desk noted that the initiative will usher in efficiency, probity, accountability and eliminate corruption in our service delivery, as customers now have a veritable and reliable tool to make their experiences known while using our facilities.

She expressed her delight at the fact that the application can be downloaded on smart phone @ www.

PEBEC.report and comments can be sent without any hindrance.

Oduwole while encouraging the

general public to also make use of the facility when there is need for commendation, also advised all government agencies to key into and support the initiative.

According to her, the Kiosks would serve as a self-service terminal, with customer service representatives to promote the PEBEC. Report app, adding that the app is the PEBEC’s official public service website for complaints and feedback on the service delivery standards of select Ministries, Departments and Agencies (MDAs).

The app was launched on 25 June 2018, at a special PEBEC meeting after a 6-month preparation period. The app has piloted with nine of the PEBEC priority MDAs (PPM); Citizens and Business Department, Corporate Affairs Commission, Federal Airports Authority of Nigeria, National Agency for Food and Drugs Administration and Control, Nigeria Civil Aviation Authority, Nigeria Customs Service, Nigerian Police Force, Nigerian Ports Authority and Standards Organisation of Nigeria.

According to her, the app is important because it makes it easy for anyone to resolve issues encountered when dealing with MDAs; strengthens federal enforcement, service delivery and public protection efforts on a national level (through filing a complaint) and helps identify trends and tracks the issues that matter to Nigerian citizens.

The app includes a feedback

mechanism for MDAs, which have assigned administrators to handle complaints according to pre-agreed service level agreements(SLA). All administrators have been trained on how to handle complaints and feedback from the app within a 72-hour timeline. On June 27 2018, the Federal Executive Council also approved a directive on strict compliance by all MDAs to respond to complains within 72 hours.

This web-based application is to foster transparency and efficiency in furtherance to the Executive Order 001 (EO1).

Recall that the EO1 was signed on 18 May 2017 by YemiOsinbajo, Vice President of Nigeria to promote transparency and efficiency in the business environment. To foster a robust monitoring and evaluation process (M&E), EO1 mandated all MDAs to submit monthly reports to the office of the Head of Service and SERVICOM. The Enabling Business Environment Secretariat tracks compliance of select MDAs with EO1 directives. On June 25 2018, a 12-month anniversary report, tracking the performance of PPMs, was presented at the special PEBEC meeting in the presence of private sector stakeholders.

The PEBEC Report kiosks have been placed in Lagos and Abuja international airports to promote the app and encourage private sector to give feedback about their airports and travel experience.

Tropical Arctic Logistics is poised to achieve incomparable heights in customer service standards”, he added.

Ibe noted that Tropical Arctic Logistics has benefitted tremendously from the unrivalled knowledge and experience of its human capital, hinting, “Our Board, Management and staff comprise some of the best and most skilled in the industry”.

He lauded Henry Odein Aju-

mogobia, the chairman of the airline and former Foreign Affairs Minister, stressing it is a testament to his legacy that he initiated farreaching reforms for the deregulation of the downstream sector of the oil industry.

He explained that the company was founded in accordance with the Nigerian Content Monitoring Development Board (NCMDB) policy to develop local capacity.

“Indeed, apart from the technical support from our off-shore partners, Rose Aviation, based in the Republic of Ireland, TAL is a company by Nigerians and for Nigerians with international best practices”.

Since inception, TAL has maintained an unwavering focus on the pursuit of excellence as its operational philosophy.

“In line with our major focus on safety and efficiency, Tropical Arctic Logistics Ltd crew are certified Federal Aviation Administration (FAA/EASA) trained personnel in alignment with the industry and country of operation regulatory requirements”.

He stated that they would continue to consistently evaluate the business dynamics and monitor the relevant sectoral indices in order to achieve optimal growth and profitability for the company.

He reiterated that these are exciting times for Tropical Arctic Logistics and all business indicators portend a very bright future for the company.

Dana Air re-brands reward program as membership hits 18,000 ...Says airline unperturbed by efforts of mischief makers Epum Somtochukwu

D

ana Air has rebranded its Dana Miles loyalty program to Dana Miles Club.

This is as the airline confirmed that the membership of the reward program has reached a record 18,000.

Speaking to newsmen in Lagos, Kingsley Ezenwa, the Media and Communications Manager of the airline, said the airline had to rebrand as a result of its growing membership and increased benefits attached to the tiers of membership - Blue, Silver and Gold. ‘’We have rebranded our reward program to Dana Miles club as a result of the growing membership and benefits. We are glad that our guests are now realizing the need to go cashless and use more of their miles for upgrade from economy to business class, payment of excess and a lot of other flight and none flight related benefits.’’ ‘’We have had a case where someone travelling with his family ran out of cash and couldn’t

pay for his excess baggage but used his excess miles to pay and still got an upgrade from economy to business class cabin. There are loads of benefits attached to being a member of the club and we are glad to have been able to grow its membership to this all-time high.’’

On the recent message circulating on social media about a statement purportedly made by one of the airline’s Pilots, Ezenwa said “first, none of our pilots could have said such. Secondly, a pilot has the right to ground an aircraft if he or she is not comfortable with its level of maintenance. So why would any pilot say such about the aircraft he or she will still fly?’’

“Last year, someone raised a false alarm and was arrested and released after promising never to engage in such anymore. Now this is the latest of their infantile de-marketing strategy. Unfortunately for them, while they are focusing on their evil acts, we are focusing on delivering quality service hinged on safety and exceptional service and we are happy that our guests are better enlightened now.’’

Thursday 12 July 2018

C002D5556

BUSINESS DAY

29

LegalBusiness BD Business Law Industry Report Practice Intelligence Partnerships

INSIDE Collocation of telecommunications sites

30 Enugu CJ launches administration of criminal Justice law

31 Foreign affairs ministry looks to collaborate with NBA towards

BusinessDay law editor gets recognition for selfless service

32

40 lawyers in Lagos get forensic & crime scene Investigation training

T

he Lagos State Office of Public Defender (OPD) in collaboration with the National Institute for Trial Advocacy (NITA), U.S recently organised a three-day training on Forensic and Crime Scene Investigation for operational efficiency of its lawyers.

Declaring open the programme on Monday in Lagos, the Solicitor General/Permanent Secretary, Lagos State Ministry of Justice, Funlola Odunlami said that the training was the second in the series, as the first, which was on Forensic Evidence and Crime Scene Investigation was held in 2017.

She stated that the collaboration between the OPD and NITA has become the benchmark for what is possible in terms of capacity building and determination for counsels in a modern era where science and the law work hand in hand.

She further said that the training, was based on practical demonstration of the protocol for Crime Scene Investigation and very important as litigation in Lagos State was on an upward trajectory with the opening of the Lagos State DNA and Forensic Centre.

According to her “This means that Defence Counsel must also have a better understanding of the science to provide the best

defence possible for clients thus the need for the training”.

The Solicitor General added that by the end of the training, 40 officers in the Lagos State Civil Service would have acquired the requisite additional skills to increase their understanding of forensic science and crime scene investigation in law to further improve the level of performance in their daily practice in and out of the courtroom.

Earlier, the Director of the OPD, Olayinka Adeyemi acknowledged an improvement in the service of the office following intensive

training of its counsels.

“As public defenders, our practice scope cuts across most areas of legal practice consisting of both criminal and civil litigation serving the indigent and disadvantaged members of the society in ensuring that they have a voice”, she said.

“This requires that our advocacy skills must be optimum and these trainings have assisted in honing the skills of each counsel assigned to the OPD”, she added.

Adeyemi stressed that NITA has for the third year running trained the counsels in Nigeria at

no cost to the Government on the art of advocacy and all its intricacies, adding that in previous years, no fewer than 70 participants drawn from the OPD and other departments of the Ministry had been trained in the art of advocacy and cross-examination, as well as opening and closing of statements and forensics.

While expressing delight on the cordial relationship existing among the Lagos state government, the NITA and U.S Government, Adeyemi urged participants to take advantage of the programme to sharpen their skills.

SAN calls for agro-industralised economy as a way out of depression

A

t the Nigerian Bar Association (NBA), Calabar Branch Law Week, a Senior Advocate of Nigeria (SAN), Paul Usoro called on the government at all levels and individuals to embark on deliberate measures to migrate from dependency on crude oil production to full scale agricultural practice as a way out of economic depression.

Presenting a paper titled ‘Migrating from Crude Oil Dependency to an Agro/Industralised Economy as a way out of Depression’ he stated that an agro-industralised economy remains key to the attainment of a sustainable and well developed economy in Nigeria.

“The agro-industry offers huge potentials for growth, with important subsectors comprising crop production and export, livestock, forestry and fishery.” Usoro said.

“The Nigerian economy has been one solely reliant on crude oil exports. This ultimately led the country falling into a recession caused by the crash of international oil prices and worsened by a drop in oil production quanti-

ties as a result of vandalisation and destruction of the nation’s oil assets by militant groups. The resultant effect of the recession heightened the need and caused the awakening of a consciousness to diversify the Nigerian economy. This is further buttressed by the fact that Nigeria is ranked 125 out of 137 in the Global Competitiveness Index ranking 2017-2018”, Usoro said.

He went on to say that “The agricultural sector provides a viable

economic alternative to the Government in order to reduce its dependency on crude oil earnings.

“It is a sector with high growth prospects in terms of output that does not require the sort of capital injections required for crude oil exploration and production.

Improvement on the sector will reduce rural-urban migration which ultimately reduces the population density and strain on amenities in urban areas”.

Paul Usoro further explained that

“The government needs to rehabilitate and revive all agricultural research institutes and schools of agriculture and reintroduce farm settlements and river basin authorities to encourage massive production of agricultural produce. This sector requires huge investments in improved machinery and technologies to make substantial impact. Most farmers are still making use of crude and unmechanised methods which yield low productivity”.

He disclosed that multiple investment opportunities abound and the development policies of international, regional and national FDIs must be harnessed to ensure the whirlpool of these funds are directed towards the development of agro-business in Nigeria.

“The drive for achieving an agroindustrialised economy must be complemented with improvement of rural and other basic infrastructure which are critical to agricultural transformation and establishment of a seamless value chain like rural electrification,

road and rail for transportation of agriculture produced and processed/finished good, for export and domestic use alike”.

In attaining an agro-industralised economy, he emphasised that government should establish and promote an export-oriented agricultural sector with improved quality of produce comparable with average global standards. He also urged the government to implement policies to attract more foreign direct investment in the sector from foreign partners with the necessary expertise and technological know-how to achieve optimal production capacity.

These, he said, will improve foreign exchange earnings.

For Paul Usoro, SAN, apart from the agricultural sector, there are a number of other sectors such as the broader extractive industry, which Nigeria has started exploring as a viable means of attaining a diversified economy. The Ajaokuta Steel Project and the mining of limestone in Okpella are examples of this renewed focus on the larger extractive industry.

30

BUSINESS DAY

C002D5556

LEGALINSIGHT

Thursday 12 July 2018

BDLegalBusiness

Collocation of telecommunications sites

…An Examination of Lessee’s Covenant Not to Assign, Sublet or Part with Possession of Demised Premises TONYE GODWIN BRAIDE

T

o promote fair competition and infrastructure sharing in the telecommunications industry, the Nigerian Communications Commission (NCC) issued its Guidelines on Collocation and Infrastructure Sharing in 2007, ushering in another phase in the telecommunications revolution in Nigeria. A regulatory regime, thus, emerged under which an infrastructure provider or a network operator shares infrastructure with one or more other network operator(s). In time, the industry turned full cycle, as it were. Some major mobile network operators changed their business models, divested from their passive infrastructure portfolio, and transferred same to infrastructure service providers, who took on the task of providing telecommunications infrastructure, as a service.

Today, collocation or infrastructure sharing has become the prevalent model in the industry. Collocation has advantages for industry operators and the society in general. By curbing the needless duplication of infrastructure and facilities - especially base transceiver station (BTS) sites collocation steers the industry and society towards a path of environmental sustainability.

With collocation, core network operators can make significant savings from funds that would otherwise have been invested in passive infrastructure, and instead invest the funds in active network capacity upgrade and expansion. It appears, however, that not all stakeholders in the industry welcome the collocation model of business.

Some lessors of land, on which BTS sites are built and operated, feel hard-done-by, and have expressed dissatisfaction with the practice of hosting multiple network operators at a BTS site.

Such lessors argue that collocation constitutes a breach of the rather familiar obligation of a lessee not to assign, sublet or part with possession of demised premises, or any part thereof, without the prior written consent of the lessor.

The situation has frequently led to disputes between operators and landlords. In the more recent lease agreements, therefore, operators have sought

to make express provision for collocation. Nevertheless, there have been cases where, even with such express provision for collocation in the lease agreements, lessors have alleged breach of the obligation. It is in the context of the foregoing that it is sought to examine the nature of the obligation not to assign, sublet or part with possession of demised premises vis-a-vis the practice of infrastructure sharing prevalent in the telecommunications industry. The aim here is to ascertain whether collocation amounts to assigning, subletting or parting with possession of demised premises. Although collocation is not limited to the sharing of tower infrastructure, for the purposes of this piece, the consideration is limited to sharing of towers or BTS sites, which are maintained on leasehold property.

Covenant Not to Assign, Sublet or Part with Possession The obligation established under the covenant is usually expressed in terms of “assignment”, “subletting” and/or “parting with possession”. An assignment is the transfer of the entire unexpired residue of the tenant’s interest in a demised property to a third party. Subletting involves a transfer, by the tenant, of possession of a part of the premises, or a transfer of any term less than the unexpired

residue of the tenant’s interest.

Although each term is capable of describing a distinct conduct in relation to the tenant’s dealing with the demised premises, all three terms remain interconnected. Thus, an assignment entails parting with possession, and a subletting also involves parting with possession.

Predicated on the contra proferentem rule, the Courts usually give a strict interpretation to the scope of the covenant not to assign, sublet or part with possession of demised premises, or any part thereof. See Oniah v.

Onyiah [1989] 1 NWLR (Pt. 99) 514 at 518 – 519. And whenever the need to interpret such provisions arises, the Courts would examine the details of the terms that constitute the covenant in relation to the particulars of the transaction between the lessee and the third party. In IsholaWilliams v. T. A. Hammond Projects Limited [1988] 1 NSCC 342, the Supreme Court considered a claim for forfeiture based on an alleged breach by the defendant of “the covenant not to assign, sublet or part with any part of the demised premises.” The apex Court referred to Hill and Redman’s Law of Landlord and Tenant (16th Edition) and stated that a covenant “not to assign” or “not to assign or otherwise part with” possession of the premises is broken only by a legal assignment of the entire unexpired residue of the term. Relying on the same juridical authority,

the Court also maintained that a lessee, “who retains the legal possession of the whole of the premises at all material times does not commit a breach of the covenant [against parting with possession] by allowing other people to use the premises.” This statement of the law finds support in the decision of the Privy Council in Lam Kee Ying Sdn. Bhd. v. Lam Shes Tong [1975] AC 247 at 256 thus: “A covenant which forbids a parting with possession is not broken by a lessee who in law retains the possession even though he allows another to use and occupy the premises.”

To my mind, the question whether a telecommunications operator – being the lessee of a tower site – has breached the covenant not to assign, sublet or part with possession of demised premises can only be determined on a case-by-case basis. For purposes of analysis, however, it is useful to consider the general practice of collocation of tower sites. The lessee network operator or infrastructure provider would enter into an arrangement with third party operator(s) to host the third party’s antenna and radio base station (or other similar equipment) within an existing tower site. For operational purposes, access to a shared tower site is usually controlled by the lessee operator or infrastructure provider such that personnel of the collocating partner can only

have access to the tower site after obtaining “access reference code” issued by the lessee, on demand. Clearly, the BTS site remain under the control of the lessee (whether as a network operator or as an infrastructure provider).

In my humble view, therefore, based upon the decision in Ishola-Williams v. T. A. Hammond Projects Limited, collocation as practiced in the telecommunications industry, does not constitute parting with possession, whether by way of assignment or subletting. Agreed, collocation of BTS sites involves sharing of use or occupation of demised premises. But, in law, mere occupation, without more, does not amount to possession. This difference may not always be obvious, but it exists. And the difference is significant. Thus it was held in Akici v. L. R. Butlin Ltd [2006] 2 All ER 872: The difference between possession and occupation is rather technical, and, even to those experienced in property law, often rather elusive and hard to grasp. Nonetheless, it is very well established, and is particularly important, and indeed well known, in the field of landlord and tenant law, especially in relation to the question of whether an agreement creates a tenancy or a licence, and in relation to alienation covenants …

The crucial point is the retention of legal possession by the lessee. And this proposition finds support in the conclusion reached by Professor Emeka Chianu, who on page 216 of his book: Law of Landlord and Tenant (2010) argues thus: A covenant not to sublet is not breached by the tenant granting licenses to persons to use and occupy the premises or part thereof while he retains the legal possession of the whole premises.

In the light of the foregoing, it is my view that generally, with or without an express provision for collocation in a lease agreement for the construction and maintenance of a BTS site, in so far as the lessee retains possession, (which, to my mind, is the case with collocation of BTS sites) the lessee, whether as a network operator or as an infrastructure provider, would not be in breach of the obligation not to assign, sublet or part with possession of the demised premises by engaging in collocation of the BTS site.

Thursday 12 July 2018

C002D5556

INDUSTRY FILE

BDLegalBusiness

Enugu CJ launches administration of criminal Justice law

T

he Chief Judge of Enugu St a t e, Ju s t i c e Ng o z i Emehelu, on Tuesday launched the Administration of the Criminal Justice Law with a pledge to ensure its effective implementation in the state.

The Chief Judge, represented by Justice Afam Nwobodo of the state High Court, said the law would bring about changes and improvement in the administration of criminal justice in the state.

“The law introduced numerous innovations aimed at fast tracking justice delivery with the goal of preserving the rights of accused persons who are now referred to as defendants.

“The new law provides that when any person is arrested and volunteers to make a confessional statement, the police shall ensure the making and taking of such statement.

“This should be done either through a video recorder or any other retrievable device and the devices produced at trial.

“This will take care of the rampant allegations of threat, duress and brutality in obtaining of confessional statements from suspects by the police,” she said.

Emehelu said to ensure effective implementation of the law, 10,000 copies of the law had been produced and would be distributed to lawyers in the state.

She explained that the gesture would act as a guide for lawyers to ensure effective implementation of the law.

Mrs Justina Offiah (SAN) a facilitator and trainer of the Enugu State

Justice Reform Team (ESJRT) emphasized the need for training of lawyers on the application of the law.

Offiah, a onetime Attorney General of the state said that the training would help to clear technicalities of the law and make them familiar to lawyers.

She explained that the ESJRT was a body duly recognised by the criminal justice law of section 539 (1, 2,3) to identify issues that prevented effective, fair and efficient criminal justice in the state.

Other functions are monitoring, identifying the problems that militate against speedy, efficient and equitable administration of justice in Enugu State, initiate reforms and help identify reform options.

She pledged to work with the Carmelite Prisoners’ Interest Organisation (CAPIO) to monitor the process of implementation of the Criminal Justice Law (CJL).

Offiah therefore reiterated the resolve of ESJRT in pursuing its statu-

tory responsibility so as to ensure the law does not become dormant and effective only on book.

Earlier, the Executive Director of CAPIO, Rev. Fr. Ambrose Ekereoku, expressed joy over the flag off of the law, 18 months after its passage by the Enugu State House of Assembly.

Ekereoku said the delay in the implementation and administration of the law was due to lack of funds by the state government.

“We made sure we got funds from Misean Cara in Ireland to put in place essential technologies and resources required for its full implementation and administration.

“For example, an aspect of the law requires that statements should be recorded and tendered in court as proof for immediate delivery of judgment.

“Reason being that, a case can be stalled if the suspect claims such confession was made under duress during interrogation or statement writing at the station,” he said.

DUCKET Court dismisses bid to stop arrest for alleged scam on Safe-tower estate project

A

Federal High Court, Lagos has dismissed a suit filed by the Chief Executive Officer of Safetrust Mortgage Bank, Akintayo Oloko to frustrate his arrest and possible prosecution by the Economic and Financial Crimes Commission (EFCC) over alleged scam on the multi-billion naira Safetowers Estate project, Lagos for lacking in merit.

Justice Muslim Sule Hassan in his judgment obtained by BusinessDay, held that by combined sections of sections 6, 7, 8, 13, 41 and 46, the EFCC is empowered to investigate and person for fraud and did not need a court order to do so.

In dismissing the suit, the court further held that the EFCC was empowered to temporary take over property for investigation, examination and enquiry.

The judge, who had earlier struck out the first applicant (Attorney- General of the federation), from the suit for not conforming with the rules of court and not disclosing course of action, held that there was a petition against the applicants for obtaining money by false pretense.

According to the court, EFCC acted within its powers and awarded the cost of N20,000 in favour of each of the respondents. He also said that the applicants cannot expect a judicial fiat to prevent EFCC from doing its work neither should they rush to court to be shielded from criminal investigation.

The EFCC, the court held, is statutorily empowered to conduct criminal

investigation against fraud or criminal activities. In the fundamental human rights suit filed against the Attorney General of the Federation, the EFCC, Kunle Ogunmefun and Currant Limited, the developers represented by the Chief Executive Officer of Safetrust, Akintayo Oloko, Safetrust Mortgage Bank, and Macbosh Properties Limited sought among other reliefs, a mandatory order compelling the respondents to return forthwith the title deed of the Safetowers Estate registered as N0 37/37/2444 at the Lagos Lands, covered

by Survey Plan N0 BAS258/2013/130116(3)/LA owned by 3rd applicant, Macbosh Properties Limited but allegedly seized by the respondents.

They also wanted an order compelling the respondents to jointly and severally tender written and public apology to the applicant as well as payment of N500million as general and exemplary damages for illegal arrest, detention, harassment and deprivation of personal freedom and liberty.

However, in their written address against the originating motion, the 3rd and 4th respondents urged the court to determine whether the applicants have substantiated facts contained in the affidavit in support of the originating motion to entitle them to the reliefs sought against the respondents and whether they have raised any reasonable cause of action against 4th respondents.

They also want the court to determine whether the EFCC acted beyond its powers when it arrested and seized the 2nd applicants documents. They

submitted that the applicants have failed to discharge the burden of substantiating their allegations with cogent evidence to entitle them to the reliefs sought.

They also urged the court to hold that the applicants are not entitled to a verdict in their favour for the alleged breach of their fundamental human rights and general and exemplary damages. In urging the court to dismiss the applicants’ originating motion with substantial cost, it was the submission of the 3rd and 4th respondents that Oloko was arrested and was being investigated following a petition, they filed to EFCC because of fraud and massive diversion of funds on the Safetower project.

It was also the submission of the 3rd and 4th defendants that the officers of the EFCC did not act outside the provisions of the EFCC Act, when they investigated the applicants based on the 3rd respondent’s petition dated June 20, 2017, arrested and seized the title deed of the Safetower estate located at Ikate, Lekki Peninsula Scheme.

Safetrust mortgage, a 25-year old bank chaired by Akinmolu Opeodu is the developer of Safetower along side Macbosh Properties Limited. Opeodu is also on the board of several companies like Mutual benefits Insurance Company, Omatek and others. The project was conceived in 2013 as a 3 blocks high rise building comprising 16 units of 3 bedroom apartments and 2 units of 5-bedroom Pent duplexes, the project was to be delivered within a construction time of 24 months.

BUSINESS DAY

31

RIGHTS WATCH HEDA asks CCB to prosecute Ambode’s aide over breach of Public Service Code

T

he Human and Environmental Development Agenda (HEDA Resource Center), which is a non-governmental organization, has demanded for the investigation, arrest, and prosecution of Lasisi Olalekan, Special Adviser on Taxation to Governor Akinwunmi Ambode of Lagos State.

According to HEDA in a letter addressed to the Code of Conduct Bureau (CCB) and signed by its chairman, Olanrewaju Suraju, the Special Adviser contravened the Public Service Code by currently serving in the Lagos State government and still holding the position of a Director of a private organization, De Soffit Consults Limited.

The letter reads: “A March 30, 2018 report by a notable news medium, revealed that two companies, linked with the All Progressives Congress (APC) leader, Bola Tinubu, and Lasisi Olalekan, Special Adviser on Taxation to the governor of Lagos State, were approved by law to collect the contentious Land Use Charge in Lagos State. They are expected to handle the collection along with Alpha Beta, another company with links to Tinubu.

“The 400 percent hike in the Land Use Charge, following an amendment of the law backing it, has provoked strident disapproval by the public. The disapproval became more intense after it was discovered that Alpha Beta, in which Tinubu is a major shareholder or the owner, was inserted as a collecting agent. Investigations by reporters revealed that the two other collecting companies are Information Connectivity Solutions Limited (ICSL) and De Soffit Consults Limited. ICSL, the report discovered, is a sister organization to Tinubu’s Alpha.”

HEDA note d fur ther that, “searches at the Corporate Affairs Commission(CAC) showed that ICSL has two directors, Messrs.

Abiodun Akinkunmi and Lanre Bankole.

Akinkunmi, a former Lagos State Finance Commissioner, was on the board of Alpha Beta while serving as commissioner, a contravention of

the Code of Conduct for Public Officers. Upon registration, Reporters gathered, the shareholders of ICSL were Alpha Beta Consulting Limited with 4,999,999 shares and Tunde Badejo, who had just one share. To deflect suspicion, Alpha Beta transferred its shares to Connectivity Investment Holding Company (CIHC) and the Document of Transfer was filed at CAC on 13 July 2017. CIHC further transferred all its shares to ICSL on 28 July 2015.

“The second company, De Soffit Consults Limited, with registration number RC 932446, has as one of its directors, Lasisi Olalekan, Special Adviser on Taxation and Revenue Matters to Ambode.

According to documents from the CAC, Olalekan owns 40 percent equity in the company, while one Mr. Ogunlana Femi owns 30 percent.

The remaining 30 percent is owned by one Lawal Olanrewaju.”

HEDA averred further that the Lagos State governor appointed Olalekan as Special Adviser while holding the position of Managing Director of De Soffit Consults Limited. Since assuming office as Special Adviser and up till date Olalekan functions as a director of De Soffit in contravention of the Public Service Code.

“The Country’s Public Service Code bars public office holders from working in private organizations. The code equally bars public officials from putting themselves in positions where personal interest could conflict with their duties and responsibilities. Section 1 of the Fifth schedule of the 1999 Constitution of the Federal Republic of Nigeria Part 1 as amended (Code of Conduct for Public Officers) provides that “a public officer shall not put himself in a position where his personal interest conflicts with his duties and responsibilities”.

“In the light of the above information, HEDA is demanding for the investigation, arrest and prosecution of Lasisi Olalekan, the Special Adviser on Taxation and Revenue Matters of Lagos State,” the letter said.

Group says 1,813 Nigerians killed since January 2018 …Amnesty International also accused the Federal Government of promoting impunity

A

mnesty International (AI) has revealed that 1,813 people have been killed since January 2018, in attacks across 17 states.

According to a statement issued by the group, the number is more than double of those killed in 2017. he group said the government is doing nothing to bring the perpetrators to book, which has led to insecurity.

Government not doing enough According to The Cable, Osai Ojigho, the group’s director in Nigeria, said that the government is not doing well in the area of protecting lives and properties.

“We are gravely concerned about the rising spate of killings across the country, especially the communal clashes between farmers and herders and attacks by bandits across at least 17 states.

“The authorities have a responsibility to protect lives and

properties, but they are clearly not doing enough going by what is happening.”

“Independently verified estimated figures indicate that since January 2018 at least 1813 people have been murdered in 17 states, which is double the 894 people killed in 2017,” he added.

Investigate Plateau killings Amnesty International also called on the government to investigate the plateau killings. It urged it to ensure that those involved are arrested.

“Amnesty International’s investigations show worrying details of how frequently the security forces failed to protect villagers.

In all cases Amnesty International investigated, the attackers, usually arriving in their hundreds spend hours killing people and setting houses on fire and then disappeared without a trace.

Culled from LEDAPNEWS

32

BUSINESS DAY

C002D5556

INDUSTRY FILE

Thursday 12 July 2018

BDLegalBusiness

BusinessDay law editor gets Foreign affairs ministry looks to recognition for selfless service collaborate with NBA towards AGC

B

T

he Honourable Minister of Foreign Affairs; Geoffery Onyeama and the President of the Nigerian Bar Association (NBA), Abubakar balarabe Mahmoud, OON, SAN, have both pledged to work together towards a successful annual general conference (AGC) come August 2018.

The promise was made when members of the Nigerian Bar Association (NBA) led by the NBA President and the Chairman Technical Committee on Conference Planning (TCCP), George Etomi FNIALS, visited the Minister at his office, in Abuja.

Speaking during the courtesy call, the NBA President began by informing the Honorable Minister of Plans for the Nigerian Bar Association Annual General Conference which have since commenced in earnest. “As you may be aware, the NBA Conference is an annual feature on the calendar of the Nigerian Bar.” He said; “This year we have invited some world leaders and influencers including His Excellency, Nana Akufo Addo, President of the Republic of Ghana and Cyril Ramaphosa; President of South Africa.

He therefore, solicited the support of the Honorable Minister and guidance in handling protocols and logistics for the invited guests so as to have a seamless and successful Conference.

In his remarks, the Chairman Technical Committee on Confer-

L-R, Abubakar Balarabe Mahmoud, SAN, NBA President; Geoffery Onyeama, Hon. Minister For Foreign Affairs and George Etomi, Chairman, Technical Committee on Conference Planning (TCCP)

ence Planning (TCCP) George Etomi noted that the Annual General Conference is arguably the largest gathering of lawyers anywhere in the world, and it not only gives lawyers and legal professionals the opportunity to discuss continuing professional development but also provide lawyers with the forum to discuss topical national issues as well as network and share ideas and their experiences.

He noted that this year, they are expecting over 10,000 delegates across the continent and urge

the Honorable Minister to assist in visa processes so that international delegates will have a seamless process on arrival.

The Honourable Minister, Geoffery Onyeama, on his part, expressed profound delight to see the enviable activities of the Nigerian Bar Association. “Of course m I’m an intellectual property lawyer. I’m very proud of the Nigerian Bar Association, of all the associations I belong to, none makes me as proud as the NBA,” Onyeama said.

usinessDay Law Editor and Chair of the Nigerian Bar Association (NBA) Lawyers in the Media Forum, Theodora KioLawson, recently received the ‘Tare Yeri Star Award’, an annual award instituted to commemorate the selfless life the late Tare Yeri lived towards the goals and objectives of the Nigerian Bar Association Section on Business Law (NBA-SBL).

Kio-Lawson, who is also the Chairperson of Media, Publicity & Mobilisation Committee of the Nigerian Bar Association Section on Business Law (NBA-SBL) was recognised for her dedication, selfless contribution and unwavering commitment towards the development of the NBA-SBL. Her involvement with the planning of the Annual Business Law Conferences over the last 10 years has been a major factor in the success of this remarkable gathering of business lawyers.

The award was presented to her

by George Etomi, pioneer Chairman of the NBA-SBL at the just concluded Annual Business Law Conference, which held in the Federal Capital Territory, Abuja.

Tare Yeri was a vibrant and selfless young woman whose life was devoted to God and to others. She was a long-standing and extremely

committed member of the NBA-SBL who served in various capacities, under every Council of the Section since its inception, and contributed immensely to its growth and development.

It would be recalled that following her untimely demise on Saturday, 22nd April 2017, the Nigerian Bar Association Section on Business Law (NBA-SBL) instituted an annual award in her honor. Tare played very critical roles in the planning of all ten editions of the NBA-SBL Annual Business Law Conference. Prior to her demise, she was deeply involved in the planning of the 2017 Conference.

Speaking about the award, Olumide Akpata, Chairman of the NBA-SBL, said he thought that it was important to commemorate Tare’s selfless dedication to the NBA-SBL. According to Mr. Akpata, “Tare was, without a doubt, one of those thoughtful and concerned individuals who contributed immensely to the success story that is the NBA-SBL.” He also emphasised the need to recognise, celebrate and express appreciation to deserving colleagues while they are still with us, as Tare’s painful loss has taught everyone.

NBA electoral committee commences verification of voters list for 2018 elections

I

n another development the Electoral Committee of the Nigerian Bar Association (ECNBA) has announced the commencement of voters verification in the coming July NBA elections.

In a statement made available to LEGALBUSINESS, the electoral committee notified

members of the bar that the elections scheduled to open from11: 59 pm on Friday July 27, 2018 to 11: 59 pm on Saturday July, 28th, 2018 shall be via an E-voting.

Accordingly, it announced that the verification exercise would take place between July 10th, 2018 through to the 15th, while urging members to for-

Middle-belt lawyers forum adopts all but two EBF candidates

L

awyers of middle-belt origin under the aegis of Middle Belt Lawyer’s Forum (MBLF) have written a letter to the Eastern Bar Forum (EBF) acknowledging the adoption of candidates for some key National offices by the EBF. In the letter addressed to the Governor of the Eastern Bar Forum (EBF), the MBLF referenced the letter dated the 19th day of February, 2018 written to MBLF and unanimously agreed to accept the adopted candidates of EBF. However the middle belt group maintained a caveat/ condition which states that

the forum has accepted all but two positions - being the office of the National Treasurer of the Nigerian Bar Association ((NBA) and that of the Welfare Secretary.

Thus the letter read, “your Forum should reciprocate the good faith exhibited by the MBLF by prevailing on Uju Chukuma Okafor and Sebastian Anyia, Esq, your Forum’s adopted candidates for the offices of National Treasurer and Welfare Secretary respectively to step down and withdraw from the race for the MBLF’s adopted candidates: Mercy ljato Agada— National Treasurer and Joshua Enernali Usman, Esq.”

ward complaints to the appropriate quarters should there be any.

“We are counting on the cooperation of every member of the bar in this regard,” the statement read, and went on to outline a step-by-step guideline for both verification and voting for eligible voters.

PHOTO FILE

Chairman of the occasion, Chief Judge of the High Court of the FCT, Justice I. U. Bello ( middle), Chief J-K Gadzama (SAN), Prof. Paul Idornigie( SAN) and participants at the 3rd Justice Chukwudifu Oputa (JSC), professional training and mentoring programme for Young lawyers held at S.M.A. Belgore Hall, J-K Gadzama Court, Garki 2, Abuja​.​

Thursday 12 July 2018

C002D5556

BUSINESS DAY

33

34

BUSINESS DAY

C002D5556

Thursday 12 July 2018

GARDEN CITY BUSINESS DIGEST Education investment in PH: Showers student wins ‘Outstanding Cambridge Learners Award’, best in Nigeria 2016

T

he British council has honoured Port Harcourt-based Showers International Schools for producing the student with the best Advanced Level results in Nigeria for year 2016.

Their student won the highest award at the Outstanding Cambridge Learners rating.

This seems to lift spirits at the school at a time economic stress is bearing down on schools in the oil region due to crash of oil prices that started in 2015.

A notification from the British Council (referenced Nnamdi Odiwe) which invited the winners to an award ceremony on June 29, 2018, in Lagos, named Showers’ Francis Anyanwu Enyinnaya to be outstanding in Biology, Chemistry and Physics in 2016/17. The letter said: “I am delighted to inform you that learners from your school who sat Cambridge examinations in November 2016/June 2017 will receive an Outstanding Cambridge Learner Award, in recognition of their achievements.

These awards recognise the exceptional performance of those learners who excelled in the November 2016/June 2017 exam series.”

In further notification, the British Council said: “We hope that learners from your school will be encouraged in their future education and careers by this recognition of their academic success. We look forward to congratulating more learners from your School in the future.”

Showers International Group has continued to smash records around the world and has won many

awards in Nigeria and Ghana where her students excel every year.

Reacting, the founder and managing director, Ekama Emilia Akpan, a MAN council member and SME and women’s activist, said the determination of the school management to pursue hard work and zero-exam malpractice has paid off by producing a generation of selfconfident scholars that can hold their grounds anywhere in the world.

She said despite the economic hardship that bites harder on schools due to massive feeding provisions and payment of salaries to staff in such a depressed economy, Showers has continued to press on with determination.

She thanked the Rivers State government for providing the enabling environment for Port Harcourt to contest with Lagos and stand excel. She said Showers as a school was an attempt to show that Port Harcourt could give Nigeria some of the best brains without academic fraud.

Showers group is known for its strong showing in the Advance Level programme.

Akpan said this has turned out to be the backbone of a child’s academic career.

She urged parents to embrace the A-Level stage so that their wards could face any university scheme anywhere in the world and hope for excellent results that could fetch jobs and strength after academic life.

Speaking further, the CEO of Showers said: “The performance has demonstrated the new drive in

Ekama Akpan (r), CEO, Showers, being congratulated by a friend, Enagha Michari.

education in south-south, Port Harcourt in particular.

For Showers to take the best in a particular year under review is a message. The award is recognition of the best in the world and Showers took the best within Nigerian scope. This award opens up a world of opportunities because this is international recognition.

“Francis Anyanwu excelled in ‘Best Across’. Showers student took first in ‘Top in Nigeria’ across four subjects and in the sciences of Biology, Chemistry and Physics. Some other schools from Port Harcourt

won in individual subjects.

“We call upon the Rivers State government, wellmeaning persons, and spirited philanthropists to support Showers and other schools that are pursuing excellence and are making the state proud. Students and youths who shunned violence, exam malpractice and cultism need to be encouraged. What is true is that Rivers Schools are not bad, they competed and came up tops.

“I just want to point out that looking at statistics, Rivers schools competed better than schools in Lagos. The

notion that good schools only come from Lagos has been defeated. The idea of running from Port Harcourt to Lagos is no longer supported by facts and figures. Moral standards and protection of the child is still better in Rivers State; value for money and value in terms of virtues that we teach.

“The state government should feel free to raise their heads high because of the high achievements of Port Harcourt schools at the Cambridge Awards. The state government must also learn to appreciate schools that excelled. There should be stakeholders’ forums annually where schools that have consistently brought honours to the state through WAEC, NECO, JAMB, and Cambridge exams can be recognized.

“Francis Anyanwu stood out as the best student in 2016 with Mathematics 91, Physics 91, Chemistry 87, and Biology 88. Cambridge is the most acceptable certification any student could get in the world. He did four papers and had the best results at that category; not many students can attempt four subjects let alone excelling in all.

The second school that stood out at A-Level is a school in Ibadan that made three papers where Francis Anyanwu made four. Incidentally, his result is not the best we have had before him; it is just that the award just started of late. We have had fantastic results in previous years, and many of those achievers are in medical and engineering schools in some of the best universities around the world.

“We appeal to the Riv-

ers state to curtail stress and too many burdens on Rivers schools. Banks and financial institutions should look into good schools in the state and support them. Rating is good in the education sector. Other countries rate their schools by looking at many indices such as examinations performance, behaviour, sports, and values systems.

Most of the schools that did very well have Christian backgrounds, an indication that moral attention helps schools and has a lot to do with excellent academic performance.

“Cheating is not an option in Showers because such students will not go far. The pride of Showers is that even when our students leave us, they continue to lead in their various institutions of higher learning around the world. We also ap peal to the British Council to make some of the trainings available in Port Harcourt. Holding all the teachers courses in Lagos makes it very expensive to most schools in Rivers State.

“On how Showers excels all the time, we say, any teacher teaching A-level must have taken the A-Level examinations. This is the only way they can flow in teaching it.

Any scholar that took A-Levels would stand out anywhere, any day, even if such a person did not make As. The bottom line still is, do you’re a-Levels after secondary school so you can stand your ground anywhere. It is the secret of academic excellence and competitiveness.”

Igwetu’s killing; How 3 rights made a wrong

Port Harcourt by Boat With IGNATIUS CHUKWU

L

inda Angela Igwetu was right to work late, up to 11pm, these days when Corpers want to make a case for retaining. She was even more right to go for a night party or what young fellows call hang out, up to 3am. One wonders when she planned to catch some sleep.

The policeman or SARS operative who killed felt he was

right to shoot before asking.

Gangsterism and hoodlumism are so rampant these days that armed policemen have learnt to shoot whatever moves.

Now, the hospital where was died was right to demand for evidence and cause of bullet wound before applying even first aid on her. To them, they did not want any police trouble that could warrant ‘come today, come tomorrow’.

To avoid it, do not touch the bleeding patient. This is their creed, no matter how hospitals deny it.

The result of everybody being right is that somebody died. So, three rights have made a wrong. That is where we are in this country: everybody is right but everything is wrong. PDP was right, APC is right, but Nigeria is crashing.

They all were right but money was looted, not just stolen.

Everybody is right, people are falling by the sword or is it AK-

47 these days. Herdsmen and other armed persons are killing people, heading south. .

Now, let’s get back to where the rights began. A 23-year-old female National Youth Service Corp (NYSC) member serving in Abuja was allegedly shot dead by a policeman later identified as Benjamin Peters, during a stop and search operation. This was around 3am.

Emotions are still high but when the dust settles, Nigerians and her parents would begin to wonder why a girl would be out all night in today’s Nigeria. The Constitution gives Linda the right on freedom of movement and association but that did not save her life.

Caution requires a good child to run home as fast as her legs can carry her after work before Frank Olizie of then NTA begins to ask; ‘Its 9pm, do you where your child is?’

It is always the instinct of young drivers to zoom past

when police are waving. Some elders however scold them.

The result is always bad, some day. This column is not saying that it has been proved that the driver failed to stop.

The policeman that shot her said Linda was standing and shouting that she was kidnapped. The bullet is said to hit her by the side. That means that it was at least four feet high. By training, should a policeman shoot the tyre (which must be at most two feet high) to stop the car or to shoot occupants? Investigators have no much work here because the answer is glaring.

The hospital! The first report said the hospital refused to treat her. They later claimed they were prompt in treating.

My countrymen, investigators have huge work here, though cover up may take over. I do not know any hospital in Nigeria that would be prompt any time especially at night on

such matters. The demand for deposit alone makes a mockery of our health care policy or attitude. A young man I know went for surgery but remained on the bed for five days crying over hernia but the doctor said lai-lai, unless N3,000 balance to complete the deposit they asked for was paid up. And it was so. My experience so far is that they will not treat a gun shot or accident victim until a police station head grants written permission. Many have so far died this way.

The mere fact that a consultant had to be called raises eyebrow. Do we not hear that doctors are paid for emergency, and in fact, they go on strike often over this allowance? The understanding is that there are doctors on duty at night and at all extra times for which they are paid extra. So, which doctor was on duty that night before we talk of calling a specialist for a case that had not even been

treated by a regular doctor?

She allegedly died of loss of blood; did it require a specialist to give her blood or try to stop bleeding? Let investigators look into this dark corner well, well. Let them get the gatemen to talk true, though they must have been heavily cautioned by now, if not transferred. Let them ask emergency ward patients, etc. Let them check the phone records of the so-called consultant and the emergency ward workers that called him, and ask the colleagues well.

Truth is glaring here, for those who care.

Whatever the case, ‘she don die be say she don die’. That is Nigeria. So, those not killed by herdsmen and Islam are now killed by us? This is we versus us. This is indolent and wickedness on parade in our national life and public service.

The guns our taxes paid for are pointed back at us, the citizens.

Cry, my people, cry!

BUSINESS DAY

Thursday 12 July 2018

35

CityFile

Killings: Church donates N7m materials to IDPs in Plateau

L

iving Faith Church Worldwide, also known as the Wi n n e r s’ C h a p e l h a s donated relief materials worth over N7 million to various Internally Displaced Persons (IDP) Camps in Plateau.

Founder of the church, David Oyedepo, who was represented at the event by the church vice-president, David Abioye, said the donations were to alleviate the victims’ plight.

He said the gesture wa s a d e m o n s t rat i o n of love and passion by Winners’ chapel for the victims in the camps in the state.

Oyedepo said the church was also moved, seeing that the victims lost homes and property during the attacks on some villages in Barkin

Ladi local government area of the state, allegedly by herdsmen. “ B e comfor te d, remain strong, and do not lose faith as this trial is only for a moment.

The body of Christ is standing with you,’’ said Oyedepo to the IDPs. Speaking also, Obed Dashen, the vice-president of Church of Christ in Nigeria (COCIN) in Heipang, said the donations would strengthen the faith of the IDPs “at this trying period.”

Receiving the donations at the St. John Vianney Minor Seminary IDP camp in Barkin Ladi, the head of the camp, Moses Jah, thanked the Winners Chapel for the gesture saying it would go a long way in alleviating the plight of the displaced persons.

Police ban public processions in Kaduna

K

aduna State police command has announced total ban on all processions ahead of the trial of Shia leader, Ibrahim ElZakzaki, on Wednesday.

T h e c o m m a n d ’s s p o k e s m a n , Mu k h t a r Aliyu, said there would be heavy deployment of security personnel to safeguard the general public.

He said residents should be “extra vigilant of their environment, persons around them, activities of suspicious persons so as to prevent miscreants disturbing

the peace.

“The law abiding people of Kaduna state a re t o n o t e t hat a d e quate security has been put in place for a hitch free court appearance”.

He said that part of the strategy put in place would be traffic diversion on Independence way, Bida road and all roads leading to Ibrahim Taiwo road.

A l i y u st re ss e d t hat the ban on all forms of processions or demonst rat i o n s i n t h e st at e was still in force and the police would deal with a n y p e r s o n o r g ro u p that violates the ban.

Scavenger bags 3 months

A

Kuje Upper Area Court in the Federal Capital Territo r y , ( FC T ) , ha s s e n t e n c e d a s c a v e n g e r, B a l a U m a r, t o t h r e e months imprisonment for stealing a gas cylinder.

Uma r, w h o wa s a rraigned on a one count charge of theft, had pleaded guilty, but begged the court for leniency.

The prosecutor, Dor i s O ko ro b a ha d t o l d the court that one Samuel Mark of Anguwan Lado area brought the

matter to the Kuje police station on July 2.

Okoroba said that Umar was accused of stealing a gas cylinder and tried to escape w h e n h e wa s cau g ht.

The prosecutor said w h e n t h e c ha rg e wa s re a d t o Uma r a n d h e pleade d guilt y to t he offence. He said the offence was contrar y to section 287 of the Penal Code.

The presiding judge, Abdulkareem Abdulahi, sentenced Umar to three months imprisonment with no option of fine. NAN

Members of the Peace Corps of Nigeria (PCN) who clashed with policemen, during a peaceful rally to mark the corps’ 20th anniversary in Abuja. NAN

Police arrest 2, recover 35 cattle from rustlers in Gombe … as NAFDAC nabs fake insecticide dealer in P/Harcourt SAMUEL ESE with agency report

T

he police in Gombe have arrested two suspected cattle rustlers and recovered 35 cattle.

The Commissioner of Police (CP) in charge of Gombe, Shina Olukolu, identified the suspects as Usman Saleh 30, a native of Gulani local government area of Yobe and Mohammed Garba 20, from Yamaltu -Deba local government area of Gombe.

Olukolu said the rustlers and the cattle were intercepted at Dadin-kowa village in Gombe with 35 cattle and suspected to have come from Taraba State.

“The suspects could not account for the source and ownership of the cattle,

hence they were arrested and the 35 cattle recovered while investigations continue,” said Olukolu on Tuesday.

The police boss warned criminal elements and mischief makers to desist from their criminal acts, noting tnat the command had put in place security measures that would continue to frustrate people with devilish plans.

He appealed to the people of the state to cooperate with security agencies by offering useful information on crime and criminality to the police.

In Port Harcourt, the Rivers State capital, the National Agency for Food and Drug administration and Control (NAFDAC) has arrested a kingpin behind the supply of fake insec-

ticides.

Spokesperson of the agency in the south zone, Cyril Monye, closed that one Ebuka Ugwuanyi was arrested while 110 cartons of the product worth more than two million naira were recovered.

He said that the Rivers’ office of NAFDAC recorded the milestone, after a successful raid and mop up of fake ‘Read A Dream’ insecticide in Port Harcourt.

According to him, the fake insecticide is a clone of the original but with questionable active ingredients which is foamy and watery.

Monye said that the original product was imported and registered by CU-BAS INT’L (NIG) LTD. “The raid was sequel to a tip off which made

NAFDAC officials to swing into action, visiting some part of Port Harcourt metropolis including Mile 1 Market, Diobu.

“One of the arrested hawkers along Aba road led NAFDAC officials to a residential building at No. 38 Iguruta road, Rumukurushi, Port Harcourt. “ That was where a major breakthrough was made and 110 cartons of the product, worth more than two million naira were recovered in a twobedroom apartment.

He said they were recovered from the last floor of a two-storey building in custody of one Peace Miller. He said that the fake product had been evacuated to NAFDAC Zonal office at Woji road in GRA phase II, Port Harcourt.

NSCDC destroys 16 illegal refineries in Edo IDRIS UMAR MOMOH, Benin

A

nti-Vandal Unit of the Nigerian Security and Civil Defense Corps (NSCDC) says it destroyed 16 illegal refineries in the last six months.

The state commandant of the corps, Makinde Ayinla who gave an insight into the operations, said eight of the illegal refineries were destroyed in Edo South, six in Edo North and two in Edo Central.

He also said that about

350,000 litres of illegally refined and adulterated petroleum product were seized and destroyed by the unit within the period.

He further said that the legal unit secured five convictions, while 23 cases were still pending in various courts within the period under review. The commandant said that the peace and conflict resolution unit between January and June handled 10 cases, with seven concluded and three still ongoing.

He also disclosed that the

Private Guard Companies (PGCs) department during the period sealed three PGCs for illegal operations while it registered and licensed 61 while 18 private guards were trained.

Ayinla further said the solid minerals unit of the command within the same period arrested nine illegal miners for operating various pits and quarry sites within the state.

“Our agro-allied unit within the period arrested nine suspected herdsmen

with various locally made arms in various parts of the state. The anti-fraud unit of the command, he said, handled 25 cases of fraud which led to the cash recovery of N2.

27 million.

He further said that the operations department within the period covered various operations, just as the Critical National Asset and Infrastructure Department deployed its personnel for the protection and preservation of government assets within the state.

36

BUSINESS DAY

Thursday 12 July 2018

Thursday 12 July 2018

37

C002D5556

Live @ The Stock Exchange PenCom’s multi-fund investment structure yet to impact equities …as returns move further negative Iheanyi Nwachukwu

N

igerian stock market moved further into the negative territory after Wednesday’s trading session on Customs Street-Lagos as sell pressure around equities outweighed buy decisions.

Increasing negatives around stocks are indications that Pension Fund Administrators (PFAs) implementation of multi-fund investment structure (MFS) on Retirement Saving Account (RSA) has not really triggered substantial shift from debt to equities.

Despite concerns over rising political risks, investors expect impressive first-half (H1) scorecards to help reroute equities market northward.

The National Pension Commission (PenCom) recently replaced the “one size fits all” investment structure for PFAs with the Multi-Fund Structure (MFS) regulation

which considers for age or risk profile of such contributors.

The multi-fund structure which requires pension contributors to choose one of the four fund types to invest their RSA became effective on July 2, 2018.

Market watchers had expected that Pension Fund Administrators to reduce allocation of assets under management (AUM) to Federal Government securities as a result of declining yields.

The FGN bond market was fairly active on Wednesday as yields narrowed for several traded maturities across the curve.

“It is unlikely that the implementation of the MFS framework will have an immediate impact on the equities market, especially with the 6 months transition period provided for PFAs, to restructure their portfolios in accordance to the framework”, according to United Capital Research analysts in their May 29 note to investors.

Analysts note that within a broader trend in the emerging/frontier economy space, Lagos Bourse joined two other leading stock markets in sub-Saharan Africa (SSA) - Johannesburg Stock Exchange and Nairobi Stock Exchange that find themselves in negative territory year-to-date (Ytd).

“The Ramaphosa bounce in South Africa did not last long: the Jo’burg index has been under water since the start of February.

Nigeria has its own elections coming: in our view, investors are not worried while they feel that the polls will be decisive, and not followed by violence and endless judicial challenges”, Gregory Kronsten–led team of analysts at FBNQuest Capital said in their July 11, 2018 note to investors.

The Nigerian equities market closed Wednesday on a negative note, as benchmark Index depreciated further by 0.45percent to 37,253.25 points against 37,421.01 points recorded

L-R: Tinuade Awe, Executive Director, Regulation, The Nigerian Stock Exchange (NSE) presenting a replica of the closing gong to Austin Avuru, Chief Executive Officer, Seplat Petroleum Development Company Plc during a Facts Behind the Figures presentation at the Exchange.

the preceding trading day.

The value of listed equities which stood at N13.556 trillion at the beginning of trading on Wednesday July 11, 2018 declined to N13.495trillion, indicating

value loss of about N61billion. The stock market’s yearto-date (YtD) returns stands at minus 2.59percent. At the close of trading, 15 stocks gained as against 25 losers.

Mobil Oil Nigeria Plc re-

corded the highest rally after its share price increased from N165 to N180.5, representing an increase of N15.5 or 9.39percent. Forte Oil Plc gained N1.45 or 4.86percent, from N29.85 to N31.3.

38 BUSINESS DAY NEWS

C002D5556

Lagos overtakes Ogun in new manufacturing...

Continued from page 1

roads. In fact, many roads along Igbesa-Agbara axis of Ogun State are bad.

Obi Ezeude, CEO of Beloxxi’s Industries, complained on February 8 this year, during a factory commissioning, that poor state of roads in Agbara was hurting manufacturers.

“The road is still not fixed up till now. Fixing that road would be a big boost to manufacturers,” Frank Jacobs, president of MAN, said. Segun Ajayi-Kadir, directorgeneral of MAN, outlined three likely causes of decline in industrial investments in Ogun.

“Ogun State, in recent times, has had its own challenges. The roads in Agbara have become bad and there have been various reports of breakdown by our members.

“Secondly, there was a lull in the economy, which must have affected Ogun. Ogun State could have benefitted more had there been more relocations of factories. More so, Ogun has the water fee and is almost following the Lagos route,” Ajayi-Kadir said.

He said manufacturers had

rushed to Ogun for investments earlier, but recent changes might have affected sentiments towards the state.

Manufacturers add that things are becoming more predictable in Lagos and less so in Ogun as many government agencies are now asking for duplicate fees and levies in Ogun.

“Ogun is gradually becoming less organised,” said Olusegun Osidipe, director of research and statistics at MAN. “Many things are still handled manually in Ogun, but you can easily check who owns a piece of land on the system in Lagos. You know how much to pay on Land Use Charge in Lagos, but not so in Ogun,” Osidipe said. Kellogg’s, an American multinational food manufacturing company, set up in Lagos in 2017.

De United Foods bought the noodles section of Dangote Flour Mills in November of last year. Several firms in Lagos acquired bought new machines, buildings and vehicles last year, manufacturers said.

The data show that out of N329.94 billion invested by manufacturers in the first half of 2017, 32.9 percent (N108.87 billion) went to Apapa zone. Ogun zone attracted 28.4 per-

cent (N93.76 billion), while Ikeja got N67.27 billion (20.4 percent of total investment).

In the second half, manufacturers made investment estimated at N176.69 billion. While 28.9 percent or N51.11 billion worth of investment went to Ogun zone, 24 percent or N42.46 billion was channelled to Ikeja, while 20 percent or N35.33 billion went to Apapa zone.

Combining the first and second half, Ogun got N144.87 billion out of the total N506.63 billion, representing 28.59 percent. However, Apapa got N144.2 billion (28.46 percent, while Ikeja got N109.73 billion (21.65 percent). This means that Ikeja and Apapa got N253.93 billion, representing 50.11 percent. But before 2017, Ogun alone often dwarfed both Apapa and Ikeja put together.

In 2014, for instance, manufacturers invested N691.77 billion, out of which N514.87 billion went to Ogun State, representing 74.42 percent of the total.

Apapa and Ikeja in Lagos contributed N15 billion and N85 billion to the investments respectively, representing a combined 15 percent of the total.

Continues on wwwbusinessday online.com

Thursday 12 July 2018

Aliko Dangote, Africa’s richest man, ...

Continued from page 1

potentially transformative that it is like Africa’s Moon landing and its Panama Canal — a Pyramids of Giza for the industrial age.

If Aliko Dangote, the billionaire businessman behind what even he calls his “crazy” $12bn project, can pull it off, he will go down as the continent’s John D Rockefeller, Andrew Carnegie and Andrew Mellon combined. And once he’s built it, he intends to treat himself to a small indulgence: he’ll buy Arsenal, his favourite football club. “When we finish this project, for the first time in history Nigeria will be the largest exporter of petroleum products in Africa,” he tells me, summoning the drabbest of platitudes for a project of pharaonic ambition.

I am sitting with Africa’s richest man discussing his life of superlatives over Thai food on his 108-foot yacht, moored in Lagos Lagoon. Yet the image he projects is more like a modestly successful encyclopedia salesman.

When I arrive at the dock, Dangote, a Muslim, is praying in his quarters. He soon comes out to greet me and turns out to be the most solicitous of hosts.

“Feel at home,” he says. “We can hang that for you,” he adds, when I place my crumpled jacket on the yacht’s white leather couch.

“Can we offer you something to drink?” Dangote goes through the options arranged before us: “There’s vegetable spring rolls, chicken wings in a barbecue sauce, green Thai curry, some kind of seafood salad, noodles,” he says.

“You are my guest, so what do you want? You want rice? Plain jasmine or with egg?” I plump for the jasmine. “You don’t eat egg?” he asks. You asked me to pick one, I protest. “That looks like satay,” I say, pointing to one of the plates.

“It is satay, actually.”

He spoons me out several of

the dishes — it’s always fun to be served by a billionaire — and we dig in. It’s tasty, and there’s a plate of green chilli sauce to liven up proceedings. Dangote crunches into a spring roll and ignores the gently buzzing phone on the table.

A few numbers on the refinery will help illuminate the scale of his “craziness”. When it is up and running — if it gets up and running — it will process 650,000 barrels of oil a day, a third of every drop Nigeria produces and approaching 1 per cent of planetary production.

That will make it the biggest oil refinery of its type in the world. As a sort of side concern, it will pump out all the plastic Nigeria’s 190m people need (or imagine they need), plus 3m tonnes of fertiliser a year, more than all its farmers currently sprinkle on their fields. To make things more interesting, Dangote is building the whole thing on a swamp. (It’s a tax-friendly swamp, at least.) That requires sinking 120,000 piles, on average 25 metres in length. No port in Nigeria is big enough to take delivery of the massive equipment, which includes a distillation tower the height of a 30-storey building, and no road is strong enough to bear its weight.

Dangote has had to build both, including a jetty for which he has dredged the seabed for 65m cubic metres of sand. There is not enough industrial gas in the whole country to weld everything together, so Dangote will build his own industrial gas plant. There aren’t enough trucks, so he’s producing those in a joint venture with a Chinese company.

The plant will need 480 megawatts of power, about one-tenth of the total that electricity-starved Nigeria can muster. You guessed it. Dangote is building his own power plant too. For years — and absurdly — Nigeria has exported all Continues on wwwbusinessday online.com

NLNG signs engineering contract...

L-R: Yemi Odubiyi, executive director, corporate and investment banking; Abubakar Suleiman, chief executive officer; Emmanuel Emefienim, executive director, Institutional Banking; Justina Lewa, company secretary, all of Sterling Bank plc, with Nobel Laurate, Professor Wole Soyinka, during the maiden edition of Sterling Leadership series themed Corporate-Culture Intersection at the bank’s head office annex in Lagos, yesterday.

Ekiti race heats up as Fayose faints, hospitalised...

Continued from page 1

but was yet to reply as at the time of filing this report.

The National Chairman of Peoples Democratic Party (PDP), Uche Secondus, alleged that Wednesday’s invasion of the Ekiti State Government House by security agents was an attempt to assassinate the governor, Ayo Fayose.

Secondus who condemned the blocking of Government House in Ado-Ekiti by security agents, described it as a ‘civilian coup’.

Addressing a press conference in Abuja Wednesday, he alleged plans by the All Progressives Congress (APC)-led Federal Government to use the 30,000 policemen deployed to the state, to intimidate the people. The governorship election is billed for this Saturday.

“This, we have been informed, is part of the ‘order from above’, in line with the earlier boast by the Buhari-led APC, to “cage” Governor Fayose ahead of the July 14, 2018 Ekiti governorship election, so as to grant their agents a field day to rig the election.

“In fact, we have been made aware that the invasion was a plot to assassinate Governor Fayose and

blame it on accidental discharge by one of the policemen.”

“The PDP marks this siege on an elected governor and a government house as a recipe for violence; a complete attack on our democratic order and direct assault on the corporate existence of Ekiti and her people as a federating part of our nation.”

The PDP chieftain accused security personnel deployed to the state of embarking on mass arrest and harassment of Ekiti citizens with the view to frightening and preventing them from participating in the election.

Also, he accused the Independent National Electoral Commission (INEC) of planning to rig the election in favour of APC, in connivance with security personnel deployed to the state.

This, he explained, is by smuggling in preloaded card reader machines and result sheets, which would be exchanged with APC agents.

He said: “The PDP is fully aware of the actors in this heinous plot including some directors in INEC, particularly in its Information Communication Technology (ICT) Department,

who have been holding clandestine meetings with APC leaders.

“The PDP however states, in very clear and unequivocal terms, that all these machinations will end in vain as nobody, no matter the evil device used, be it harassment, threats, arrests or even murder, can subjugate the people of Ekiti State and forcefully take over their leadership in this election without their consent.

Meanwhile the Deputy Inspector General of Police (DIG) Operations, Habilal Joshak, has said the security details of important personalities in Ekiti will be with-

drawn on Saturday to add to the credibility of the Ekiti governorship election holding on July 14.

The Police boss added that no party would be allowed to hold any political rally not approved by the police until the election is held.

Addressing journalists in Ado Ekiti on Wednesday, Joshak said he would work with Assistant Inspector General of Police (AIG), H.H. Karma and three other Commissioners of Police; Ali Janga , J.B. Kokumo and G.B. Umar, who will man each of the senatorial districts in the state.

Continues on wwwbusinessday online.com

Continued from page 1

N2.52 trillion ($7 billion) from the global financial markets for the sustainability of its operations and expansion project which will increase its production capacity from 22 Million Tonnes Per Annum (MTPA) to 30 MTPA.

At a ceremony in London yesterday (Wednesday) to commemorate the repayment of a $5.45 billion Shareholder loan for its existing trains, Tony Attah, Managing Director/Chief Executive Officer of NLNG, revealed that funds being sought will cover the company’s expansion program (construction of Train 7) and investment in the upstream gas sector in Nigeria that will ensure the sustainability of feedgas supply to its existing trains (Trains 1 to 6) and the new Train 7.

The repaid consolidated loan contributed towards funding the Base Project, Expansion Project, NLNG Plus Project and Train 6. The final repayment is a milestone for NLNG and Nigeria.

“Our financial credibility speaks for itself and we will be testing the financial market once again with our sustainability and expansion projects estimated at $7 billion.

Raising $7 billion is no small feat; anywhere in the world, this will be a major event. Therefore, we will be seeking support from the local and international financial institutions,

our shareholders and the Nigerian government,” Attah said.

Also yesterday in London, the Nigeria LNG Limited (NLNG) awarded the contracts for Front End Engineering Design (FEED) of its planned plant expansion project, Train 7, to B7 JV Consortium and SCD JV Consortium.

Train 7 will cost as much as $6.5 billion to build, with another $5 billion to be spent on upstream gas supply, Attah said.

A completed FEED process will pave way for Engineering, Procurement and Construction (EPC) pricing and bidding processes which are preconditions for Final Investment Decision (FID).

The consortia, B7 JV Consortium comprising American company KBR Inc., Technip of France and Japan Gas Corporation (JGC); and SCD JV Consortium, made up of Saipem of Italy, Japan’s Chiyoda and Daewoo of South Korea, will participate in the Dual FEED Process and produce a Basic Design Engineering Package (BDEP) that will determine their EPC pricing, and eventually their bids to construct the train.

On the Dual FEED strategy, Attah said “the Front End Engineering Design is the most crucial part in the build-up to the actualisation of Train 7, after some delay and lost opportunities to reinforce Nigeria’s Continues on wwwbusinessday online.com

Politics & Policy Thursday 12 July 2018

C002D5556

BUSINESS DAY

39

The brigandage in Ekiti must stop now - Atiku

F

ormer Vice President of Nigeria, Atiku Abubakar is appalled at the images coming out of Ekiti in the last few hours.

Atiku Abubakar said in a statement in Abuja on Wednesday that behaviours such as these are an uncivil assault on democracy and falls short of democratic best practices.

The Peoples Democratic Party presidential hopeful reminded that the current administration came into being because the preceding PDP Federal Government ensured free and fair elections at all levels.

“Having been a beneficiary of such propriety, it is incumbent on the Federal

Government not to deprive others of the ladder it was provided by its predecessors.

“Free, fair and credible elections are not a privilege.

They are a right! The peaceful congregating of the good people of Ekiti State, be they members of the All Progressive Congress or the Peoples Democratic Party or of any other party, must be allowed by the Federal Government”.

Atiku observed that it is not in the place of government to harass, intimidate, hound and humiliate political opponents in an election. What government should do is to provide a level playing ground and guarantee the security of the electorate and the principal political actors in the election.

“The immunity that a

Fayose being rescued

president enjoys under the constitution is the same immunity being enjoyed by a state government, thus it is an aberration to democratic norms and practices in a fed-

‘Impediments to emergence of a female president not insurmountable’ CHUKS OLUIGBO

W

o m e n a s p i ring to occupy the seat of the Nigerian president have been called upon to buckle up and work as hard as their male counterparts as the obstacles to their victory are not insurmountable.

Nkem Akinsoto, United States-based writer and trustee, Strategy and Innovation for Development Initiative (SI4DEV), a non-governmental organization, made this call in a recent chat with BusinessDay. Akinsoto spoke against the backdrop of the declaration of interest by a number of women to contest the 2019 presidential election.

“Any woman that plans to win the presidency must be willing to put in the work that her male counterparts are doing. They can start with community development projects if they are young, volunteer to be part of civil society holding the government accountable, or join a political party and begin working their way up the ranks. And when they are ready, they will need to traverse Nigeria, and tell all citizens why they are the

best candidate for the job,” Aknisoto said.

“At the party level, for instance, women can negotiate for positions in party leadership and use this position to begin to initiate changes in the way parties work in Nigeria. They can also dialogue with current officials for a way to make nomination forms affordable for all,” she said.

BusinessDay last Sunday reported that currently, there are four women seriously contending for their parties’ presidential ticket for 2019 – Remi Sonaiya, retired professor of French Language and Applied Linguistics at Obafemi Awolowo University (OAU), Ile-Ife; Eunice Atuejide, legal practitioner, businesswoman and management consultant; Olufumilayo Adesanya-Davies, professor of Language and Communication Arts at the Rivers State University of Education, and Elishama Rosemary Ideh.

On whether women politicians stand a chance to win the presidential election, Akinsoto said they definitely do, “but maybe not in this current election cycle”.

“You see, an intention to join the race is different from a plan to actually win, and

2019 may be too soon for a well-laid plan to be successfully carried out to win the presidency,” she said.

While acknowledging the several factors impeding women participation in Nigeria’s presidential election – such as “the patriarchal system in the country that seeks to relegate women to the ‘other room’”, “the cost of candidacy forms”, and “the male leadership of parties that tend to have meetings in less women-friendly venues and times” – Akinsoto, however, said she did not think anyone was “actively or overtly” standing in the way of women running for and winning the presidency per se.

“After all, in past years, women have won in local government, National Assembly, and state Houses of Assembly elections; others have run and did not win.

Some women have also competed in party primaries or general elections for the position of president,” she said.

“We need to hear more from these women, both those that won and others that did not win. What can we learn from their different experiences? What did the winners do that the others overlooked? And vice versa?” she added.

eral system of government that one layer of government should muscle out another government on account of political differences. The democracy and fundamental

human rights that Nigerians enjoy today was earned at a very high price.”

Instructions must be immediately given to all law enforcement bodies on the ground in Ekiti State to act in the best interest of Nigeria, Atiku said.

He stressed that anything that will put democracy in jeopardy in Ekiti or anywhere else in Nigeria should be stopped forthwith.

He urged those with powers over the security forces to be aware that the world is watching, reminding that democracy and freedom are inalienable rights of the Nigerian people which the Peoples Democratic Party guaranteed for sixteen years.

“It is too late in the day

for anyone to think they can put that genie back into the bottle”, he said.

The former Vice President however admonished the Federal Government to do everything within its powers to douse the tension being generated over the governorship election in Ekiti State.

“It is for this reason that (he) welcomes the call by the United Nations Secretary General, Antonio Guterres for the reactivation of the National Peace Committee as an instrument to stem the continued escalation of violence and killings in Nigeria.

Government should take a cue from what the Adamawa Peace Initiative (API) is doing to stem violence in many states of the North East.”

2019: Labour Party, ADP pull out of opposition alliance with PDP ust when the opposition camp in the country was savouring the euphoria of the recent alliance to dislodge the ruling All Progressive Congress (APC) from power, the Labour Party (LP) and the Advance Democratic Party (ADP), yesterday denied being part of an alliance of thirty-eight political parties in the country which recently signed a memorandum of understanding (MoU) to present a consensus presidential candidate in the 2019 presidential election.

Speaking in an interview with BusinessDay yesterday, National Chairman of Labour Party, Mike Omotosho, disclosed that the party was not part of the meeting where the decision and the MoU was signed, stressing that the party was impersonated by its former chairman who was no longer member of the party.

“The labour Party is not part of any alliance with some political parties, it was the former Chairman who impersonated the party at the meeting, I have spoken and we cannot be part of that,” Omotosho said.

Also in a statement, the National Chairman of the ADP, Sanni Yusuf, said that the party could not be part of such alliance with the PDP

because its ideology was different from that of the PDP which it could not work with, stressing that the party’s ideology was different, while it was ready to transform the country and provide purposeful leadership if voted into power.

Yusuf said that the alliance may not achieve the desire result because the PDP was still been control by individuals who ruined the country in the sixteen years that the party ruled the country.

“It is incontrovertible that the PDP and APC are two sides of a coin. For sixteen years, PDP ruled this country with impunity and without regard to the universally accepted norms of democracy. Stealing, misappropriation and all forms of corruption became parts of the state policy.

“ADP is not prepared to jettison its values and constitutional provisions like the use of direct primaries as against the often used corrupt delegate system by the other parties in the Coalition.

ADP is also not in a hurry to hobnob with those who mismanaged Nigeria for sixteen years and now regrouping in an un-strategic haste to resume unprecedented loot of the nation’s treasury.

“It is important to know that those who pushed Nigeria to the precipice are the

drivers of the Coalition and have nothing new to offer. To collaborate with them, is to sleep with strange bedfellows.

“The ADP is not averse to any political Coalition that can bring about a positive overhaul of the Nigerian system. But this shall be done with true patriots who are not a part of the Nigerian problem. In the desire to acquire power, we shall not compromise the basic principles and ideology that informed our birth which includes All-inclusiveness, Democratic Empowerment of the Youth/Women and Party Supremacy.

“We find it extremely difficult to compromise our principles and align with ‘ANYTHING BUT BUHARI.’ Let it be known that for us, it is not negotiable that Buhari must go. He has failed and those who love him should tell him that his time is up.

“At ADP, we believe the time has come for a generational shift in leadership and not putting old wines in new bottles, which is what the PDP led coalition represents. It is instructive to remember that it was a similar ragtag coalition that brought the rudderless APC to power in 2015, so Nigerians must wake up and resist another deceit by the same desperate and corrupt politicians”.

at the Police Headquarters in Ado Ekiti on Saturday.

“We won’t allow anybody to go to the Polling booth with armed men, this is a breach of the Electoral Act. “We have contacted them and they have to be here before election commences. This election must not be compromised.

They will be documented and

whoever defies this will be sanctioned, because they have been contacted”, he warned.

Joshak urged his men not to work for any political party, saying any police officer found exhibiting such will have himself to blame.

“Those who want to create posts where votes are going to be bought will be disappoint-

ed. We are not going allow it.

“If you cast your votes, you can keep a distance and protect your votes, but if you snatch the ballot, we will cut off your hands, if you run with it, we will stop your legs.

“If you come out with masquerade on the day of election, we will get it arrested and unmask the man behind it.

INIOBONG IWOK

J

Ekiti poll: Police to withdraw Fayose, Fayemi’s security aides RAPHAEL ADEYANJU, Ado-Ekiti

T

he Deputy Inspector General of Police (DIG) Operations, Habilal Joshak, has said the security details of important personalities in Ekiti will be withdrawn on Saturday to add to the credibility of the Ekiti governorship election holding on July 14.

The police boss added that no party would be allowed to hold any political rally not approved by the police until the election is held.

Addressing journalists in Ado Ekiti on Wednesday, Joshak said he would work with one Assistant Inspector General of Police (AIG), H.H. Karma and three other Com-

missioners of Police; Ali Janga , J.B. Kokumo and G.B. Umar, who will man each of the senatorial districts in the state.

Joshak said they had contacted security details of Governor Fayose and the candidate of the All Progressives Congress (APC), Kayode Fayemi and other top government officials to report at 6 am

Thursday 12 July 2018

C002D5556

Africa loses $50bn yearly to illicit financial flows – ECA ‌ as NLC insists continent must tackle corruption JOSHUA BASSEY

A

frican countries are committed to mobilising adequate and predictable resources to finance the sustainable development goals agenda, but have continued to be impeded by a number of factors.

Chief among these factors is the loss of more than $50 billion annually through illicit financial flows (IFFs), Sylvain Boko of Economic Commission for Africa (ECA), says.

Boko’s assertion comes as Ayuba Wabba, president, Nigeria Labour Congress (NLC), says for Africa to experience rapid development, her leaders must resolve to tackle corruption in all ramifications, insisting that systemic corruption remains a major setback to the continent.

Speaking at the ongoing three-day high-level policy dialogue on development planning in Africa, in Cairo,

the capital of Egypt, Boko, who is the principal regional advisor and head of development planning and statistics at the ECA, said it was unacceptable that Africa’s development agenda continued to be hampered by such illegal financial flows. “It is estimated that $100 billion a year, about 4 percent of Africa’s GDP, have been illegally earned, transferred, or used, much of it due to mis-invoicing. This retards Africa’s growth; weakens public institutions and rule of law; discourages the culture of paying taxes and valueaddition to natural resources, and results in countries over relying on official development assistance,� Boko said.

He noted that Africa required hard data on the scope of IFFs, removing legal loopholes that facilitate IFFs, designing cohesive international agreements to address IFFs, and developing local and national capacity to address IFFs, among others. “The challenges are many and varied, but not

insurmountable. In this regard, countries must build technical, legal and administrative capacity for effective public financial management,� he said.

On his part, Wabba, speaking in reference to the Africa Union anti-corruption day, which was marked yesterday (July 11), said winning the fight against corruption was the sustainable path to Africa’s development. “We identify with the African Union (AU) as it marks this year’s anti-corruption day. In our view, corruption remains the most pressing governance and development challenge confronting Africa today, Nigeria inclusive. “Corruption in several ways continues to arrest growth and development, creating in the process situations of unacceptable unemployment, infrastructural decay, collapsed energy systems and capacities, massive production deficits and near absence of social justice,�

Wabba said.

ANAP scribe gets death threats over agitation for service conditions IFEOMA OKEKE

N

ational General Secretary of the Association of Nigerian Aviation Professionals (ANAP) has alleged a death threat has been issued to him over agitations for the condition of service for workers of the Nigerian Meteorological Agency NiMET. Abdulrasaq Saidu, the ANAP scribe, said he had been threatened with death text messages.

Saidu, who briefed newsmen on the threat to his life at ANAP office in Ikeja, revealed that he got a call from a mobile phone number 08054969604 Tuesday morning at about 7:30am, while getting ready for work.

But explained that the due to poor network he could not get the voice of the person clearly adding that the person later sent text messages which reads as follow: “If you love yourself be careful if not the violent change you are planning will consume you and all your co travellers. Be warned.�

Level of corruption in Nigeria shocking, destructive - EFCC IDRIS UMAR MOMOH, Benin

A

cting chairman of the Economic and Financial Crimes Commission (EFCC), Ibrahim Magu, on Wednesday described the level of corruption in the country as shocking, destructive and totally unacceptable.

Magu made the remark during the Benin zonal office of the anti-graft agency walk against corruption organised by the commission to commemorate the African Anti-Corruption Day in Benin City.

The EFCC boss, represented by Yakubu Malaria, Hhad, Benin zonal office, noted that Nigeria had one of the most extensive and deeply entrenched culture of corruption on the African continent, if not in the whole world.

He said the level of corruption was manifested in the increasingly large number of corruption related investigations, litigations, convictions and recoveries made by the commission since 2003.

He said the commission had traced and recovered

SA president urges Nigeria to sign AfCFTA, manufacturers say otherwise

P

resident of South Africa, Cyril Ramaphosa, in his visit to Nigeria urged President Muhammadu Buhari to sign the continent-wide free-trade deal (AfCFTA).

He said this in a conference in Abuja, saying Nigeria should take its time to consult on the agreement before signing up, but should not take too long. “The continent is waiting for Nigeria and South Africa. By trading among ourselves, we are able to retain more resources in the continent,� Ramaphosa said.

Although, Kemi Adeosun, Nigeria’s finance minister, stated that the nation cannot rush signing the deal because “it does not want to get things wrong.

The government is talking to stakeholders including manufacturers.�

Meanwhile, the Manufacturers Association of Nigeria (MAN) had earlier disclosed that the African Continental Free Trade Area was shrouded in secrecy and that Nigeria would be worse for it if the country signed the agreement in its current form.

Frank Jacobs, president of MAN, stated that some of the fears originally expressed by MAN had not been doused or addressed.

“We are worried that this could be misleading and, more importantly, may not put Nigeria in good stead and could inexorably put the nation in a disadvantaged position if or when the implementation of the AfCFTA commences. “The major fear of manufacturers, therefore, is that Europe will smuggle products to Morocco via AfCFTA and the products will be branded ‘Moroccan’. Such unfair and dirty trade practices are rife on the continent,� he said.

AfCFTA is considered the largest trade agreement since the World Trade Organisation (WTO) in 1994.

It is a flagship project of Africa’s Agenda 2063, targeted at creating a single market for Africa’s 1.2 billion people and exposing each country to a $3.4 trillion opportunity. It is meant to create a single market for goods and services on the continent, including a customs union with free movement of capital and persons as the focus.

In another note of the negative impact the free trade will bring for Africa’s largest exporter of crude oil, Muda Yusuf, Director-General of the Lagos Chamber of Commerce and Industry (LCCI) earlier stated that a liberal trade regime within the continent poses a major risk to the Nigeria manufacturing sector.

illicit funds as well as properties worth billions of dollars.

While expressing the determination of the commission to win the corruption war, no matter how long it will take, he said the agency’s depth and gravity of corruption in the country could be seen in its achievement between January and July 2018 alone, where 142 convictions were secured among which were that of the former governors of Plateau and Taraba states, respectively.

He however called on the judiciary and the entire bench in the temple of justice to support the ongoing war against corruption in the country, saying the judiciary and the bench were key to the success in the ongoing fight against corruption.

He also called on Nigerians, trade unions and civil society organisations to support the commission in restoring transparency, accountability and due process in governance.

The event had in its theme, ‘Winning the fight against corruption. A sustainable path to Africa’s transformation.’ L-­R:  Tarun  Kumar  Das,  managing  director,  6SULQJÂżHOG $JUR .HZDOUDP &KDQUDL *URXS $UYLQG 0DWKHZ FKLHI RI ,QWHUQDWLRQDO operations,  0DKLQGUD DQG 0DKLQGUD Limited,  and  3UDNDVK 9DVZDQL FKDLUPDQ Geepee  Group,  at  WKH 0DKLQGUD IDUP WHFK PRELOLW\ DQG SRZHU VROXWLRQV IRU 1LJHULD PHGLD EULHÂżQJ LQ /DJRV \HVWHUGD\ 3LF E\ Pius  Okeosisi

‌ finance minister says no rush OGHOGHO EDOSOMWAN

$ 1(:6

BUSINESS DAY

Digital economy to generate $88bn in 3yrs OGHOGHO EDOSOMWAN

N

igerian government is resolute, almost to near obsession, on creating an enabling environment where digital economy opportunities are not just theoretical but become real, Okey Enelamah, industry, trade and investment minister, says.

Digital economy is projected to generate $88 billion and create up to 3 million jobs in the next 3 years.

The minister, who spoke at the “Invest In Nigeria� Summit – Silicon Valley – Palo Alto, California, USA, said, “That is why we are here.�

The Nigerian delegation led by the Vice President Yemi Osinbajo, includes senior gov-

ernment officials, regulators, companies leading the charge of innovation in Nigeria and some of our leading technology talents.

Enelamah said the technology sector had recorded some good strides – more than doubling in size over the past nine years, now accounting for 9 percent of our GDP. He recalled some recent landmark investments in the sector: “From the $20 million fundraise in Andela, to $10 million fundraise in Flutterwave, to the $7 million in SureRemit via a blockchain ICO, $1.1 million in Piggybank. There are easily scores of these today and counting.

He assured the investors that there was no question about the entrepreneurial spirit of young Nigerians, and

so the future was now. “Today, we have brought you some of our best: from the government, from the private sector, technology companies, local finance, policy makers. I hope this leaves no doubt as to our commitment to establishing a winning partnership with you in Nigeria’s technology ecosystem,� he said.

The primary purpose of the visit is towards attracting investments into Nigeria’s burgeoning tech space. It follows the Vice President’s inauguration last month of the Advisory Group on Technology and Creativity, established by President Muhammadu Buhari as part of an effort to boost industrial policies and competitiveness for the country.

The committee has a good number of private sector

members with roots in one technology operations or the other. As our source would reveal, the Vice President’s entourage comprises a number of tech-savvy entrepreneurs from that advisory board.

The trip is to showcase to the world the progress and strides in the country’s technology, innovation and creative space by Nigerian start-ups and entertainment industry practitioners.

At the meeting held on Tuesday in Silicon Valley, the team interacted with scores of Nigerians working with Google. He later met with a series of key technology investors and also visited the headquarters of LinkedIn where he was the special guest at the firm’s Fireside Chat with a packed full room of Nigerians in Diaspora.

A2

NEWS

BUSINESS DAY

C002D5556

Thursday 12 July 2018

SON gives Dangote Cement new quality certification

3rd Mainland Bridge: Traffic challenge expected as FG plans 27 months’ repairs

tandard Organisation of Nigeria (SON) has certified Dangote Cement as having passed the Mandatory Conformity Assessment Programme (MANCAP), a development the agency said had stood out the company among its competitors in the industry.

Director-general of the SON, Osita Anthony Aboloma, who made these disclosures, also said that a new revised standard for cement production in Nigeria had been released.

The SON DG who was represented by the agency’s Director of Standard Development, Mrs. Chinyere Egwuonwu stated these during a partnership facility tour of the Dangote Cement Plant, Obajana, Kogi State by top officials of the organisation from the Northern parts of the country.

He noted the new certifi-

JOSHUA BASSEY

S

cation was an attestation to the Dangote Cement Plc’s quality products and its capacity to conduct in-process and in-house tests on its raw materials and finished products in conformity with relevant national standards.

He said, “Through our conformity assessment activities, we have always visited your plants on routine quarterly factory inspections to ensure compliance of your products to relevant national standards. The outcome of these activities is the certification of your products to the Mandatory Conformity Assessment Programme.”

The SON boss further disclosed that the revised standard for cement NIS 444-1:2018 has been approved by the Standard Council of Nigeria and is ready for implementation.

Aboloma commended Dangote Cement for its ac-

tive participation especially in the area of standard development saying the SON appreciated the company’s effort and that the SON would be ready to partner and collaborate with the company’s management.

He promised that the SON would continue to collaborate and provide the required support with Dangote Cement, other private sector operators and stakeholders to ensure availability of the relevant standards for both raw materials and finished products.

In his remark, the Group Managing Director of Dangote Cement, Joseph Makoju said the Company has never taken the issue standard with levity and that is why it does not limit itself to the set standards but usually exceeds standard both in quality of its products and environmental friendliness of its plants operations.

L

agos, Nigeria’s commercial and financial capital, with vehicular density of 740 vehicles per kilometre, may be in for a long traffic challenge commuting between the Mainland and Island, as the Federal Government plans to stagger rehabilitation work on the Third Mainland Bridge over a period of 27 months.

The bridge, the longest in Africa, was built by Julius Berger plc and opened by Ibrahim Babangida, former head of state, in 1990. It measures about 11.8 kilometres, and it is one of three bridges linking the Lagos Mainland and Island. The other two are Carter and Eko bridges.

The three bridges are considered inadequate to serve the commuting needs of Lagos’ estimated 21 million population, and to fill the gaps, the Lagos State government had long proposed another bridge to be known

JUMOKE AKIYODE-LAWANSON

N

Manufacturers canvass consistent policy to spur palm oil industry

M

anufacturers say o n l y a consistent government policy can revive the palm oil industry and make the sub-sector a reliable foreign exchange earner.

They say the country must close its borders against smuggling if it is willing to slug it out with Indonesia and Malaysia in the highly competitive palm oil market.

Santosh Pillai, managing director of PZ Wilmar, a palm oil refiner, told BusinessDay that there were illegal and questionable imports into the country,

fic Management Authority (LASTMA) and the police.

According to Kuti, the bridge will be totally shut to traffic on the first three days for the contractor to carry out various tests on it and subsequent closures would be on partial basis.

“A dynamic test on bridge expansion joints on Third Mainland Bridge is to be carried out between Friday, July 27, 2018 and Sunday, July 29, 2018 and it has been done in such a way that it will have minimum impact on road users.

“Consequently, the Third MainlandBridgewillbeclosed to traffic by 12.00 midnight of Thursday 26th July, 2018 and be opened by 12.00 midnight Sunday 29th July, 2018.

“Alternative routes will be plied during this period and traffic control will be in place to direct and help traffic movement. We regret any inconvenience this might cause road users as this closure is inevitable,’’ he said.

NCC moves to protect telecoms critical national infrastructure

L-R: Idowu Ajanaku, special adviser to governor of Lagos State on information and strategy; Peter Obi, former governor, Anambra State; Femi Otedola, chairman, Forte Oil plc, and Dele Momodu, author of the books title “PENDULUM 1; PENDULUM 2, and Fighting Lions, at the public presentation of the books in honour of late Moshood Kashimawo Olawale Abiola, in Lagos, yesterday.

Pic by Olawale Amoo

ODINAKA ANUDU

as Fourth Mainland Bridge, and currently searching for private investors/partners to build it.

Adedamola Kuti, the federal controller of works, Lagos, said on Wednesday that the emergency rehabilitation of the Third Mainland Bridge project would begin on July 27.

Kuti, at a stakeholders’ meeting in Lagos, said the repair work on the bridge would be staggered over a period of 27 months and would be handled by Borini Prono Construction Company.

The meeting was convened by the Federal Ministry of Works for stakeholders to brainstorm on effective traffic diversion and management to prevent gridlocks during the period.

In attendance were Nigerian Union of Petroleum and Natural Gas Workers (NUPENG), National Union of Road Transport Workers (NURTW), Association of Maritime Truck Owners (AMATO), Lagos State Traf-

which prevent genuine investors from having a level playing field.

“Visit any supermarket or traditional market in Nigeria and you will see that plenty of imported vegetable oil, which is banned in the country, is easily available. The current policies are only aiding cross-border trade and smuggling. The leading domestic refineries in Nigeria are facing a crisis and many in the country are not operational,” Pillai said.

In t e r n a t i o n a l d a t a show that palm oil worth 400,000 tons per annum are smuggled into the country annually. Palm oil is currently one of the commodities restricted by

the Central Bank of Nigeria (CBN) from accessing the foreign exchange market, but smuggling from Malaysia to Ghana, down to Kano, is rife and hurts local investors.

“This discourages further huge investment by investors like us and creates unhealthy competition in the market,” Felix Nwabuko, managing director of Presco, told BusinessDay. Romanus Oguegbu, managing director of a medium-scale palm oil mill in Uburu, a community in Imo State, said he is cutting down production as purchases from Kano, Abuja and Lagos oil traders have dropped significantly because they prefer

to buy smuggled brands that are relatively cheaper.

“I normally produce 400 gallons (of 25 litres) each week. But this has dropped by half. This affects the number of workers we employ. The number of workers has fallen to eight, from over 15 during peak demand,” Oguegbu said.

“This is too bad to us, and no one knows the type of palm oil smuggled into Nigeria. It could be hazardous to health,” he said.

Nigeria produces 900,000 to 1.3 million metric tonnes (MT) of palm oil, with national demand standing at 2.1 million MT. The huge gap provides an opportunity for smugglers and importers evading duties.

igerian Communication Commission (NCC) has initialised a memorandum of understanding (MoU) with the Nigeria Security and Civil Defence Corps (NSCDC) to protect the switch stations and Base Transceiver Stations (BTS) belonging to MTN and other telecom operators, following the recent nationwide picketing by the Nigerian Labour Congress (NLC), which resulted in vandalism of telecoms infrastructure.

From July 9 to Wednesday July 11, 2018, members of different chapters of the NLC rallied round MTN service centres in Enugu, Kano, Bayelsa and other states where MTN operates across Nigeria including its head office in Lagos to protest the alleged victimisation of MTN workers in Nigeria.

According to the Labour Union, MTN Nigeria denies its workers the right to join unions and has majority of its workers as casual staff for as long as ten years, saying that most of the company’s workers are being exploited on a daily basis.

MTN released a statement on Monday, refuting all claims made by the NLC. Tobechukwu Okigbo, MTN’s corporate relations executive, said; “We do not prevent our employees from associating amongst themselves as they deem fit and owe our employees the

obligation to ensure they are not compelled to join associations.”

MTN also complained that in addition to the vandalism of its property, some of its workers had also been attacked and injured during the NLC protest.

“Today’s violence and the needless destruction of property is deeply saddening. As always our primary concern is the safety and well-being of our employees, some of whom were attacked by supposed NLC operatives and have sustained injuries,” Okigbo said on Monday.

As a result, the NCC contacted ACG Iyogho of the NSCDC on the matter and directed MTN to liaise with the NSCDC on the issue of the picketing by NLC and the reported destruction of telecom infrastructure across the country.

In a statement sent to BusinessDay, the NCC confirms that it has briefed the security agencies on developments particularly the implications of the attempt to shut down the Ojota switch station.

“A collapse of the telecommunications grid is likely, if these attacks on MTN and other telecom facilities are not abated.”

NCC recalls clearly that telecom infrastructure was classified as Critical National Infrastructure under the Cyber Security Act domiciled with the Office of the National Security Adviser (ONSA).

Thursday 12 July 2018

FT

C002D5556

BUSINESS DAY

A3

FINANCIAL TIMES Theresa May’s Brexit gambit propels pound into buy zone

Trump accuses Germany of being ‘a captive of Russia’

Page A5

Page A4

World Business Newspaper

Investors fret as Erdogan’s son-in-law takes economic reins President consolidates power by giving finance role to Berat Albayrak LAURA PITEL

F

rom the moment he entered politics just three years ago, it was clear that Berat Albayrak would not be constrained by the limits of his official energy brief. As the son-in-law of President Recep Tayyip Erdogan, the former business executive soon found himself setting out the Turkish government’s position on military operations, joining high level overseas visits and accompanying his wife’s father on the campaign trail.

Few expected, however, that Mr Erdogan would be bold enough to put his 40-year-old protégé in sole charge of the economy at a time of mounting concerns about its health.

As he formally adopted his new role as combined treasury and finance minister on Tuesday, Mr Albayrak promised to “work night and day” to maintain fiscal discipline and bring down the country’s soaring inflation.

But foreign investors — who for years were soothed and reassured by slick former financiers appointed to senior government positions — remain nervous about how the economy will fare in the hands of a member of the Erdogan family who is a largely unknown entity.

After the announcement of his appointment on Monday, the Turkish lira, already down 17 per cent from the start of the year, suffered its biggest one-day slide since the violent coup attempt of July 2016.

“Foreign investors don’t know him very well,” said Andressa Tezine, a senior sovereign analyst at Fidelity International. “We don’t know about his proposals for a new economic model — if there is one. We don’t know what he thinks about the exchange rate or interest rate levels.”

The son of a prominent Islamist writer and longstanding friend of the Turkish president, Mr Albayrak married Mr Erdogan’s daughter Esra in 2004 in a lavish ceremony in Istanbul that was attended by more than 7,000 guests. In subsequent years, he has become one of the Turkish leader’s closest confidants.

Before entering parliament in 2015, Mr Albayrak spent most of his professional career at Calik Holding, a conglomerate owned by another

Erdogan family friend.

One of his first acts after becoming chief executive in 2007 was to buy a prominent media group whose outlets became among the government’s most important mouthpieces. That purchase — a $1.1bn acquisition funded mainly by state-owned banks — led to a downgrade by the rating agency Fitch.

Promoted to the cabinet almost immediately after becoming an MP, Mr Albayrak endured a mixed reputation during his three years as minister for energy and natural resources. Businessmen, including senior figures in the energy sector, would complain that he was haughty and would rarely grant appointments.

“He is difficult to deal with,” said a businessman who has known him for years. “He has a very high opinion of himself. He presents himself as crown prince in the making.”

Many believe that Mr Albayrak is being groomed by the 64-year-old president as his successor.

Within government, Mr Albayrak gained a reputation for run-ins with other ministers. He was accused by allies of former prime minister Ahmet Davutoglu of gradually undermining him until he resigned.

Later, he clashed with Mr Davutoglu’s successor, Binali Yildirim, as well as with the interior minister, Suleyman Soylu.

In public, Mr Albayrak subscribes enthusiastically to Mr Erdogan’s narrative that foreign powers are seeking to bring down Turkey. During the campaign for last month’s election, as Mr Erdogan resisted investor pressure to raise interest rates, Mr Albayrak warned that the currency crisis was being caused by an “operation” of “overseas origins” aimed at bringing down the government.

Such remarks are unlikely to reassure investors clamouring for a fresh interest raise rise at the next central bank meeting on July 24, which they say is needed to curb soaring inflation that reached 15 per cent in June.

Those looking for positives argue that Mr Albayrak speaks fluent English, has an MBA from an American university and has business experience.

Pfizer delays drug price rises after discussions with Trump Unusual U-turn on 100 products including Viagra follows criticism from US president DAVID CROW

P

fizer has postponed price increases on 100 products following an extensive discussion with President Donald Trump, who had said the company should be “ashamed” of the move.

The highly unusual U-turn came a day after Mr Trump lambasted the

price increases— first reported by the Financial Times last week — by saying Pfizer and other drugmakers were “taking advantage of poor people”.

Continues on page A4

Berat Albayrak subscribes to President Recep Tayyip Erdogan’s narrative that foreign powers are seeking to bring down Turkey © Bloomberg

US to impose tariffs on $200bn of Chinese imports

Escalation of trade war between the two economic powers unsettles financial markets

SAM FLEMING, JOE RENNISON AND LUCY HORNBY

D

onald Trump kicked off the process of imposing tariffs on a further $200bn of imports from China, in a significant escalation of the trade war between the two economic powers and one that directly challenges US corporations.

The new list of tariffs takes aim at multinationals reliant on sourcing from China for materials and components including automotive parts, food ingredients and construction. If implemented, they would have a bigger impact on US consumers than the tariffs imposed last week on $34bn of goods, which focused on manufacturing components.

The president has told the US trade representative Robert Lighthizer to begin preparations for levies of 10 per cent, the administration

said, as it set forth a list of products that may be targeted.

The announcement triggered declines in financial markets as traders reacted to the worsening relations between the two nations and prompted criticism from senior figures within the president’s own party.

China-focused stocks led a broad sell-off in Asia-Pacific equities and the renminbi slid in response to the tariffs.

The Trump administration’s move comes after Beijing accused the US of “trade bullying” and slapped tariffs on $34bn of American exports. China’s action last week came “without any international legal basis or justification”, Mr Lighthizer said on Tuesday evening.

“For more than a year, the Trump administration has patiently urged China to stop its unfair practices, open its market, and engage in true market competition,” he said.

“We have been very clear and detailed regarding the specific changes China should undertake. Unfortunately, China has not changed its behaviour — behaviour that puts the future of the US economy at risk.”

USTR will now begin a public notice and comment process running through July and August, before the imposition of the final tariffs. Mr Trump has told journalists he was ultimately willing to impose tariffs on all $500bn of the goods imported from China.

Beijing has retaliated to the measures imposed to date by targeting US farm and energy exports, including soyabeans. The Ministry of Commerce said on Wednesday that China was “shocked” by Washington’s moves. The actions “were hurting China, hurting the entire world and hurting the US itself”, the ministry said, noting that the “irrational action was unpopular”.

Sky agrees to sweetened £24.5bn takeover offer from Fox Move by Rupert Murdoch comes after Comcast disrupted deal with its own bid ARASH MASSOUDI, MATTHEW GARRAHAN AND ADAM SAMSON

R

upert Murdoch’s 21st Century Fox has agreed new terms to acquire Sky, the pan-European TV group, in a deal worth £24.5bn that is designed to see off a rival offer from US media giant Comcast.

Fox said on Wednesday that it had agreed to pay £14 per share for Sky, a significant premium to the original £10.75 per share deal it made with the London-based company in December 2016.

The Financial Times reported on Tuesday that Fox was preparing to boost its offer for Sky to fend off Comcast, the cable and entertainment group, which swooped in this April with its own £12.50 a share bid for the company.

Sky’s independent committee said on Wednesday that the Fox bid “represents a substantial increase in value relative to the Comcast offer”, adding that it “intends to unanimously recommend” the offer

to Sky shareholders.

Martin Gilbert, head of the independent committee, said: “We welcome this increased offer which is 30 per cent higher than 21CF’s initial bid and 12 per cent above Comcast’s. This offer reflects the strong position the business is in and is an attractive premium for shareholders.”

However, Mr Murdoch’s company has yet to receive UK government clearance on its planned takeover of Sky, which remains a key obstacle to a deal. The government’s decision is expected by Friday.

The new offer is pitched below the trading range for Sky shares in recent days, which closed on Tuesday at £15.01, giving it a market value of £25.6bn. Sky has net debt of £7.4bn, according to FactSet data.

The shares slipped back to £14.85 in early London trading on Wednesday.

Analysts questioned Fox’s latest offer. “It seems inconceivable a deal can go through at this £14 level,”

said Alex DeGroote, an independent City analyst. “This is not a knockout blow at all [and] we are puzzled it’s recommended.”

A number of hedge funds including Seth Klarman’s Baupost Group, Paul Singer’s Elliott Management, Davidson Kempner and Odey Asset Management have piled into Sky shares in the expectation of a continuing bidding war.

Sky has become a pawn in a global media power play between Comcast and Disney, the US media group. Disney has agreed a $71bn takeover of Fox’s entertainment assets, including its 39 per cent stake in Sky, and will take full ownership of Sky if Fox succeeds with its bid. Fox also has net debt of nearly $14bn.

In addition to competition from Comcast, the increased Fox offer reflects improvements in Sky’s operating performance thanks to its recent success in securing rights to the English Premier League at a price lower than most analysts had expected.

A4

BUSINESS DAY

C002D5556

NATIONAL NEWS

FT Pfizer delays drug price rises after discussions

US regulator to examine auditors’ ‘going concern’ reporting

Continued from page A3 The largest standalone drugmaker in the US said on Tuesday that it would temporarily reverse the increases that came into effect on July 1, which applied to some of it bestknown drugs including Viagra, the erectile dysfunction medicine, and Xalkori, a treatment for lung cancer.

“Pfizer is rolling back price hikes, so American patients don’t pay more,” Mr Trump said in a tweet.

“We applaud Pfizer for this decision and hope other companies do the same. Great news for the American people!”

In a statement, Pfizer said Ian Read, its chief executive, had agreed to postpone the increases to give Mr Trump more time to implement reforms of the US healthcare system that were unveiled in May. The company said the prices would return to pre-July 1 levels and stay there until the end of the year or until the president’s “blueprint to strengthen the healthcare system” comes into effect, whichever happens soonest.

“Pfizer shares the president’s concern for patients and commitment to providing affordable access to the medicines they need,” said Mr Read.

He added: “The most fundamental way the biopharmaceutical industry creates value is by discovering innovative medicines that help people live longer, healthier, more productive lives.”

Pfizer did not say whether the move would hurt its profitability in the second half of the year, although some analysts have previously said the company needed to increase prices regularly to maintain earnings growth.

Last week, the FT reported that Pfizer had raised the price of the affected products, in most cases by about 9 per cent. It was the second time the company had implemented a string of increases on lots of drugs this year, meaning the price tag on some of its medicines was almost 20 per cent higher than at the start of 2018.

It used to be common practice for drugmakers to raise their prices twice a year — once in January and then again in the summer — but many have refrained from the second increase amid heightened scrutiny of the industry’s pricing policies.

However, Pfizer has continued to hoist its prices twice a year, leaving it more exposed to the political fallout of such a strategy. Celgene, the biotech group, and Novo Nordisk, the diabetes drugmaker, have also increased their prices more than once in 2018, as have a series of lesser-known companies.

Earlier this week, Mr Trump criticised Pfizer’s move in an angry tweet. He said: “Pfizer & others should be ashamed that they have raised drug prices for no reason.

They are merely taking advantage of the poor & others unable to defend themselves, while at the same time giving bargain basement prices to other countries in Europe & elsewhere. We will respond!”

Thursday 12 July 2018

PCAOB move comes as investor fears grow over confidence in audit statements MADISON MARRIAGE

T US President Donald Trump gestures while speaking to Jens Stoltenberg, Nato secretary-general,during breakfast on Wednesday in Brussels © AP

Trump accuses Germany of being ‘a captive of Russia’ US president attacks Berlin over gas pipeline and defence spending at Nato summit

DEMETRI SEVASTOPULO, MICHAEL PEEL AND TOBIAS BUCK

U

S president Donald Trump has accused Berlin of being “a captive of Russia” for allowing a new Moscow-backed gas pipeline project to be built to northern Germany and attacked Chancellor Angela Merkel for failing to spend enough on Europe’s defence.

The broadside came in the opening hours of a Nato summit in Brussels on Wednesday that allies had hoped would demonstrate unity in the face of efforts by adversaries to divide its members.

Speaking during a breakfast with Jens Stoltenberg, Nato secretarygeneral, Mr Trump said Germany was a “rich country” that could boost defence spending “immediately”, adding that it was an “inappropriate” situation that the US would no longer tolerate.

After Mr Stoltenberg stressed the importance of maintaining unity, Mr Trump shot back: “How can you be together when a country [Germany] is getting its energy from the country you want protection against? . . . They’re

just making Russia richer.”

Mr Trump has frequently lambasted the failure of many Nato nations to boost military spending — and specifically to reach a goal set in 2014 to spend 2 per cent of gross domestic product on defence. But he has stepped up attacks in recent weeks.

Ms Merkel emphasises that Berlin has raised its military budget in recent years, and will continue to do so.

“In 2024 we will spend 80 per cent more on defence than we did in 2014,” the German chancellor said on Wednesday.

“There are many things for which Germany feels gratitude towards Nato. German unification and the unity of Europe — this had a lot to do with Nato.”

“But Germany also contributes a lot to Nato. We are the secondlargest supplier of troops.”

Mr Trump has also intensified his attacks on the EU over its $151bn trade surplus with the US, and also singled out Germany on the issue.

Mr Stoltenberg said the trade dispute had not “impacted Nato that much” but said he “cannot guarantee” that it would not affect relations with the

alliance in the future.

Mr Trump will meet Ms Merkel later on Wednesday. Sarah Sanders, White House press secretary, said he would probably repeat his criticisms of Germany and its relationship with Russia.

The US has moved to impose sanctions on Moscow over the pipeline project, which has angered Washington and some of its eastern European allies because it bypasses them to deliver Russian gas directly to Germany via the Baltic Sea. The first Nord Stream pipeline was supported by then German chancellor Gerhard Schröder, who later became a senior executive at Russian gas giant Gazprom and is close to Russian president Vladimir Putin.

Mr Trump said Germany was “totally controlled by Russia” because it got 60 to 70 per cent of its energy from Russia. “You tell me if that’s appropriate . . . I think it’s not.”

“We’re supposed to be guarding against Russia and Germany . . . pays billions and billions of dollars a year to Russia,” he said. “We’re supposed to protect you against Russia but they’re paying billions of dollars to Russia and I think that’s very inappropriate.”

Facebook hit with first fine over Cambridge Analytica data scandal UK levies £500,000 penalty and accuses group of not protecting user information ALIYA RAM, BARNEY THOMPSON AND HANNAH KUCHLER

F

acebook has been hit with its first financial penalty over the massive data leak to Cambridge Analytica after a UK watchdog accused the social network of breaking the law.

The fine was issued as part of a stinging report from Britain’s Information Commissioner’s Office, which issued the maximum fine allowable under old data protection laws, £500,000.

It accused Facebook of not protecting user data and failing to be transparent about how it shared information with third parties.

The ICO investigation also shone new light on the extent to which political parties were using personal data sold on by data brokers without consent.

It announced it was expanding its 14-month investigation into data and politics, which has centred on the Facebook data leak, into whether Arron Banks,

a major donor to the campaign for the UK to leave the EU, improperly gave pro-Brexit groups data about voters obtained for insurance purposes.

The UK regulator is also investigating whether Mr Banks’ Eldon Insurance Limited’s call centre staff used customer databases to make calls on behalf of Leave.EU. The official Remain campaign, Britain Stronger In Europe, is also being investigated over how it collected and shared personal information.

The ICO opened its probe in May 2017 “to explore practices deployed during the UK’s EU referendum campaign but potentially also in other campaigns”.

Elizabeth Denham, the UK information commissioner, said the ICO had been “astounded” by the amount of personal data in the possession of Britain’s political parties.

The ICO sent warning letters to 11 political parties and notices compelling them to agree audits of data protection practices, and

started a criminal prosecution against Cambridge Analytica parent SCL Elections after accusing it of failing properly to deal with a data request.

Facebook had sought to draw a line under the data privacy scandal after revelations that it allowed data from up to 87m US voters to be harvested and then passed to Cambridge Analytica, a company employed in the presidential campaign of Donald Trump.

“We think they broke the principle of fair processing; we think it was unfair processing,” said Ms Denham. “Data controllers are supposed to have reasonable safeguards in place to process data and we felt they were deficient in that and in their response on questions and follow-up about the data leak.”

Facebook, which has 28 days to contest the fine, said it had been working with UK authorities and acknowledged that it should have acted earlier in the Cambridge Analytica case.

he US accounting watchdog has promised to examine whether market intervention is necessary to strengthen investor confidence in auditors’ “going concern” statements — crucial judgments that indicate whether a company is viable for the next 12 months.

The regulator’s focus on going concern opinions, which are made by directors and signed off by auditors, comes as the Big Four accounting firms find themselves under repeated attack over the quality of their work, misconduct, conflicts of interest and their lobbying power.

These criticisms have undermined investor trust in the financial statements signed off by the four — Deloitte, EY, PwC and KPMG. These firms are responsible for auditing the vast majority of the world’s largest companies.

The Public Company Accounting Oversight Board said this week that it would launch a project to evaluate “whether there is a need for regulatory action . . . in light of concerns from investors about the effectiveness of auditor going concern reporting”.

The PCAOB said it would consider whether to change its standards around going concern evaluations, which currently state that an auditor should flag its worries if it has “substantial doubt” about a company’s ability to survive.

The regulator is also assessing how changes to accounting requirements have affected going concern reporting.

Erik Gordon, a professor at the University of Michigan’s Ross School of Business, said revisions may be necessary as “many US investors see the going concern disclosure practices as useless”.

Shareholder scepticism about these judgments increased after the 2008 financial crisis, when none of the banks that failed or were bailed out received a going concern caveat.

Prof Gordon added: “It’s an investor joke that you see a going concern warning for a portfolio company just after you get the company’s bankruptcy notice. Accountants are reluctant to issue going concern warnings. It is bad for business. It also could trigger loan default provisions that make the warning a self-fulfilling prophecy.

“Management who pick the company’s audit firm can be persuasive when they present their mitigation claims to counteract the auditor’s going concern doubts.

Accountants are not expected to see the future but some investors suspect accountants close their eyes to the present.”

The Financial Reporting Council, the UK accounting watchdog, separately confirmed it had also been working on a project related to going concern statements by auditors.

The focus of the FRC’s project, which has not been detailed in the public domain, is on the amount of work an auditor needs to carry out in order to reach a going concern conclusion.

Thursday 12 July 2018

C002D5556

BUSINESS DAY

A5

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Theresa May’s Brexit gambit propels pound into buy zone Sterling’s resilience suggests confidence among traders but EU response remains key ROGER BLITZ

B

rexit turmoil is driving a deep wedge in the ruling Conservative party, but the resilience of the pound suggests confidence among traders that the currency represents long-term value.

Looking beyond the bloodletting in Westminster, financial markets are sending the message that a soft Brexit is now within sight.

Such an outcome would reduce the clouds over the economy, facilitating a more active Bank of England tightening cycle, thus underpinning a sustained recovery in the pound’s fortunes.

At $1.32, the pound remains more than 8 per cent off its year high of $1.43 reached in April and has spent the past two years since the EU referendum trading well below the $1.50 level that was the market’s floor for sterling during the first half of the decade.

At current levels, the pound is “significantly undervalued”, said Stephen Jen of Eurizon SLJ Asset Management.

Estimating sterling’s fair value at $1.60, Mr Jen believes the upshot of the Cabinet deal hammered out by prime minister Theresa May at her Chequers retreat was that the pound was “in the buy zone again”.

Few investors would stake much of their reputation and forecasting on how Brexit negotiations will play out in the coming months, but of note is that hedging against currency volatility has stayed in the same range for the past four months.

And after Mrs May weathered two high-profile ministerial resignations in quick succession this week and appears to have withstood the threat of a leadership challenge, some investors believe the UK’s Brexit crisis has reached a significant moment.

It was “a moment of clarity”, said Tristan Perrier, strategist at the European investment fund Amundi, who had expected a stronger sterling rally. “We are on a glide path to a reduced level of political uncertainty.”

Derek Halpenny, forex analyst at MUFG, said the week’s dra-

matic events in Westminster had crystallised a fact that has been in existence since last year’s general election: “That the parliamentary numbers are more in favour of a softer version of Brexit, which greatly inhibits the potential action the hard Brexit faction can take.”

Still, it may take some days yet before investors are brave enough to buy the pound. Ahead of the resignations, net short positions on sterling were at their highest since September, when the currency was last below $1.30.

The market is understandably cautious and will want to see further evidence pointing to a soft Brexit before the pound gets up a head of steam.

Two pieces of evidence are crucial: that Mrs May’s strategy continues to hold sway within her divided Conservative party, and that the EU negotiates with her rather than rejects the PM’s proposal out of hand.

Investors have yet to see the white paper detailing the Chequers deal, and will want to gauge the reaction of European leaders.

Kathrin Goretzki, G10 strategist at UniCredit, said the Chequers deal was “a necessary first step” and a basis for negotiation.

“Now, with this in place they can start talking about something,” she said. “But the market is rightly aware that the EU is not going to accept that position right away.”

Whatever the extent of Brexit risk remaining in the currency, it also seems to be having a diminishing influence on the BoE, that other key component of sterling’s value.

The signals from governor Mark Carney and his colleagues are that overnight borrowing costs will rise beyond the current base rate of 0.5 per cent, possibly in August.

The Westminster turmoil is a reason for the BoE to tread cautiously, Ms Goretzki argued. Brexit uncertainty had increased even further, she said, adding that “the right thing [for the BoE] to do would be to hold off [raising rates] now.”

But although BoE policymakers continue to pay due heed to Brexit, the case for a rate rise has been strengthened by falling unemployment, rising wages and improved data.

US stock futures slide after US plots fresh China tariffs PAN KWAN YUK

W

all Street traders are bracing for a bruising day on Wednesday after the Trump administration started the process of imposing tariffs on a further $200bn of imports from China, in a sharp escalation of the trade battle between the world’s two largest economies.

With an hour to go before the opening bell, futures for the S&P 500 are down 0.7 per cent while those for the Dow Jones Industrial Average and the Nasdaq 100 both dropped 0.8 per cent.

The moves follow a sharp selloff in Chinese and Hong Kong stocks on Wednesday. European stocks posted smaller drops, although those more exposed to China’s economy and the trade dispute - namely miners and

metals maker - took a bigger hit.

US chipmakers were among the biggest losers in pre-market trade.

Advanced Micro Devices, Nvidia and Micron Technology were all down more than 1 per cent amid fears that China would retaliate by banning these companies - whose memory chips are used in many smartphones, computers and other devices - from the country.

Industrial stocks, after having enjoyed several days of calm, are back under fire again. Boeing is down 1.2 per cent, Caterpillar dropped 1.5 per cent and Deere & Co. shed 2 per cent amid the heightened trade war fears.

The jitters helped boost demand for Treasuries however. Yield on the 10-year, which move inversely to price, is down 2.6 basis points at 2.8473 per cent. The dollar also got a bump, with the dollar index up 0.2 per cent at 94.33.

US President Donald Trump gestures while speaking to Jens Stoltenberg, Nato secretary-general,during breakfast on Wednesday in Brussels © AP

Trade war escalation rattles global stocks and China’s currency Wall Street set to follow weaker share markets in Asia and Europe MICHAEL HUNTER, PAN KWAN YUK AND GABRIEL WILDAU

W

a l l St re e t w a s s e t to open lower on Wednesday and join a global share market sell-off as investors recoiled from the Trump administration plans to impose new tariffs on $200bn worth of Chinese imports.

US equity futures trade signalled an opening decline of 0.7 per cent for both the S&P 500 and the Nasdaq Composite. Investors anticipate a tough start for US chipmakers with shares in Advanced Micro Devices, Nvidia and Micron Technology all down more than 1 per cent amid fears that China would retaliate by banning these companies — whose memory chips are used in many smartphones, computers and other devices — from the country.

Industrial stocks, after having enjoyed several days of calm, were back under fire, with the likes of Boeing down 1.2 per cent, Caterpillar off 1.5 per cent and Deere & Co. shedding 2 per cent.

European stocks remained down more than 1 per cent in afternoon trade, and those more exposed to China’s economy

and the trade dispute led the declines. The Europe-wide Stoxx 600 fell 1.1 per cent. The index tracking miners, who rely on China’s economy to generate demand for much of their output, lost 3.4 per cent. with copper prices at a year-low. The equivalent benchmark for industrial metals makers fell just over 3 per cent.

The escalating trade war is adding to downward pressure on China’s economy from a slowdown in infrastructure investment and reduced subsidies for the property market.

“Given that we now have $250bn of tariffs either in place or in the works, on top of existing tariffs on steel, aluminium, washing machines, and solar panels, the US is proposing to place a tariff on nearly half of China’s exports to it,” said Michael Every, senior macro strategist at Rabobank.

The CSI 300 index, which tracks Shanghai- and Shenzhentraded blue-chips, closed down 1.7 per cent, leading a broad retreat in the Asia Pacific region.

The renminbi was 0.4 per cent softer against the US dollar after dipping to its weakest intraday level since July 3.

“When US actions surpass expectations, the entire market takes a hit, not just sectors that are specifically affected,” said Chen Yunyang, macroeconomic analyst at New Times Securities in Shanghai.

For the renminbi, bearish sentiment is linked more directly to the trade war impact. Market participants are worried that tariffs or a negotiated settlement will erode China’s current account surplus, which has already narrowed in recent years.

After suffering its worst month in June and extending its decline in early July, the renminbi had traded in a narrow range for the past four sessions amid signs that the central bank was intervening modestly to support the Chinese currency.

Central bank governor Yi Gang and party secretary Guo Shuqing have both publicly stated that the renminbi is unlikely to slide significantly. The People’s Bank of China has also set its daily exchange-rate fixings somewhat stronger in recent days than the level implied by the central bank’s stated formula — a signal that the central bank is discouraging major depreciation.

Nex shareholders’ punchy payday protest PHILIP STAFFORD

M

ore than 40 per cent of shareholders in Nex Group have voted against the UK financial technology company’s policy allowing management’s share bonuses to vest if a planned sale to Chicago’s CME Group goes ahead.

Investors registered their protest against Nex’s remuneration report at its annual meeting in London on Wednesday. Just under half of shareholders who had voting rights cast their ballot. Nex chief executive Michael Spencer is the largest shareholder, and controls more than 17 per cent of shares.

Based on feedback, Nex said the investors’ protests were because of provisions in its share plans related to options and awards if there is a change of ownership.

Days before the end of the financial year, Nex agreed a £3.9bn sale to CME, the US derivatives exchange. It expects the deal to close in the second half of the year but the deal must first receive antitrust approval in the US, UK, Hong Kong, Germany, Italy and Sweden.

Nex typically awards its executive management team shares as part of a long-term incentive scheme. If the CME deal is completed, 75 per cent of the executive managements’ shares will effectively vest and the rest will

be replaced with a cash award six months later. ISS, the shareholder advisory group, had urged investors to vote against the proposal.

Nex said it was “disappointed” by the reaction and said it “would review and respond to the feedback from shareholders” if the CME deal did not proceed.

The vote means Nex directors have faced successive rebellions from shareholders over their actions. Last year they barred Nex Group’s board from making political donations after it used shareholder money to back five Conservative candidates at the general election. Shareholders overwhelmingly voted in favour of the CME deal at a meeting in May.

DAY BUSINESSDAY A6 BUSINESS

C002D5556

C002D5556

Thursday Thursday1212July July2018 2018

InfraCredit joins league of Harvard Business School cases We hope that the Harvard Business School case will attract more global capital inflows into Nigeria’s infrastructure investment, which is profoundly needed.

– Chinua Azubike

Chinua Azubike, InfraCredit CEO

One year after it launched operations, the choices and challenges facing Nigeria’s first infrastructure credit guarantee company have attracted the attention of scholars at the Harvard Business School. How it fares could have a magnified impact on bridging the country’s infrastructure gap.

By Obiora Tabansi Onyeaso

I

nfrastructure Credit Guarantee Company (InfraCredit) has joined an elite circle of African companies by having a case study about its mission and operations published by the Harvard Business School. It would now form part of the curriculum at the renowned business school.

The case which is titled Infrastructure in Nigeria: Unlocking Pension Fund Investments was co-authored by John D. Macomber, a senior lecturer in finance, and Pippa Tubman Armerding, director at Africa Research Office. Both are senior faculty at HBS. Each year, HBS publishes about 350 cases. Only a tiny fraction is devoted to organizations outside North America, Europe and Asia. Often characterized as the defining pedagogical experience of an HBS education, the case method has been described as ‘a profound educational innovation that presents the greatest challenges confronting leading companies, non-profits, and government organizations and places the student in the role of the decision-maker.’

On an average, HBS sells 10 million cases per year. Its dominance in the field is evidenced by the fact that 80 per cent of the case studies used by business schools around the world are written by its faculty.

Macomber and Armerding identify the scale of financing required to close the infrastructure finance gap in Nigeria, as well as the challenges facing developers of projects with long-term profitability recovery.

It is estimated that Nigeria would need to spend up to $3 trillion over the next 30 years to shore up its gaping infrastructure deficit.

In the short-term, the National Integrated Infrastructure Master Plan projects that Nigeria would need to make infrastructure investments of over $127 billion in the next five years.

The case investigates two central issues that would determine InfraCredit’s capacity to meet its ambitious goals: the funding options available to the company to support its growth, and the obstacles that must be overcome if the appetite of the country’s pension funds for infrastructure debt securities is to grow.

Established last year, InfraCredit was conceived as a quasi-private credit enhancement provider by the Nigeria

Sovereign Investment Authority (NSIA) in collaboration with GuarantCo, a member of the Private Infrastructure Development Group. Essentially, its mission is to catalyze long-term local currency debt capital formation for investment in infrastructure projects by providing guarantees of timely payment for holders of debt securities issued by eligible infrastructure entities.

Until InfraCredit guaranteed Viathan Funding’s N10 billion issue, which paid a coupon of 16 per cent over a ten-year period, a tenor that long for a corporate infrastructure entity had never been done before.

At its launch, Uche Orji, managing director and CEO of NSIA spelled out its mandate. ‘InfraCredit will enhance Nigeria’s capacity to attract and unlock pools of capital from pensions and insurance for infrastructure investment in key sectors of the economy.’

The vision was that by providing credit guarantees to developers/operators of eligible infrastructure assets, it could reduce their cost of local currency debt capital, and significantly extend the tenor of their debt, thereby quickening the country’s infrastructure deficit catch-up rate.

InfraCredit enjoys an AAA credit rating from Agusto & Co and GCR, a first for a domestic local currency guarantor in SubSaharan Africa. This constitutes its key credit strength, which it deploys in lending its balance sheet by guaranteeing transactions .

Under its mandate, eligible projects will broadly fall under any of ten activities: agricultural, energy, gas distribution, ICT/Telecoms, infrastructure, inputs to infrastructure, social infrastructure, transportation, waste management, and water distribution & treatment.

From a low base of 25 per cent of GDP today, InfraCredit’s goal is to pump up the

Source: National Integrated Infrastructure Master Plan (NIIMP)

country’s infrastructure stock to 70 per cent in line with international benchmarks within 30 years.

The first transaction successfully completed by InfraCredit within its first year of operations was for Viathan Funding, a special purpose vehicle of Viathan Engineering, a provider of captive and embedded power solutions based in Lagos. Viathan needed funds to expand its generation capacity, build a compressed natural gas plant, and pay off short-term expensive loans. At the time, bank loan rates went as high as the mid-twenties.

I n f r a C re d i t g u a r a n t e e d V i a t h a n Funding’s N10 billion issue, which paid a coupon of 16 per cent over a ten-year period.

Until then, a tenor that long for a corporate infrastructure entity was unheard of.

This transaction exposed the main benefit that InfraCredit brings to mobilising private capital for infrastructure debt issuers; InfraCredit enhanced Viathan’s credit from a BBB- credit rating by Agusto & Co. and Global Credit Rating (GCR) to an ‘AAA’ rating, and crowded in sixteen institutional investors including twelve pension fund administrators.

To finance infrastructure development, the local debt capital markets needs to be relatively developed. In today’s environment, accelerating the development of domestic capital markets in emerging markets, particularly for local currency debt, is more crucial than ever as global financial reforms have transformed banks’ willingness and ability to lend, and recent events have highlighted the potential

repercussions of borrowing significantly in foreign currencies, at least for businesses that are not export-focused.

In its corporate presentation, the company hinted at the size of its ambition.

It plans to grow its aggregate guarantee portfolio of corporate infrastructure bonds from the current N10 billion up to N510 billion by 2021.

A quantum leap of that proportion implies the assumption that with the successful operations of InfraCredit, new local bonds issuance will undergo a faster annual growth rate in the future than has historically been the case.

Data from FMDQ indicates that from 2013 to date, corporate bond issuances, which today stand at N327 billion, have grown by a sluggish c.23% compounded annual growth rate which is significantly low given the huge deficit in funding required to plug the infrastructure gap.

In his comments on the HBS case, Chinua Azubike, CEO of InfraCredit said ‘We are very honoured that Harvard Business School has chosen InfraCredit as a model for its MBA students. It is a great privilege that in such a short space of time since we began commercial operations, our mission and activities have been judged worthy of attention by the world’s leading business school. We are committed to fulfilling our mission and its long-term sustainable impact. In the end, we hope that the case will attract more global capital inflows into Nigeria’s infrastructure investment, which is profoundly needed.’

Thursday 12 July 2018

C002D5556

NEWS DFID UKAid addresses challenges confronting education in Nigeria MIKE OCHONMA

D

epartment for International Development (DFID) and UKAid is collaborating to address some of the critical challenges facing quality of education and best ways it could be improved upon in Nigeria.

The Developing Effective Private Education Nigeria (DEEPEN) programme is a DFID UKAid-funded programme managed by Cambridge Education, a member of Mott MacDonald UK. The programme was established to improve the quality of education in private schools, especially those serving children from low-income households in Lagos.

Using a market-development approach, the DEEPEN programme continues the progress from the Education Sector Support Programme in Nigeria (ESSPIN), with a particular focus on improving learning outcomes of children from low-income families.

This is the second in a series of dissemination events and will bring together senior government officials and other stakeholders in education – including commissioners, permanent secretaries, and directors – in the South-West region of Nigeria.

Speaking at the event which held at the Radisson Inn in Abeokuta recently, the team leader of the DEEPEN programme, Gboyega Ilusanya emphasised on the need to address the challenge of improving education quality.

“Given the rising importance of private education, the learnings of DEEPEN will help to set the agenda and structure for the intervention of states and development partners in education.”

The DEEPEN programme has, without doubt, recorded numerous successes in its attempt to establish a vibrant and dynamic market for private education in Lagos.

More than 277, 000 children from across 2,500 schools have directly benefitted from DEEPEN’s interventions. We believe this is a good opportunity for stakeholders to learn and better understand how to effectively manage the phenomenon of private education, particularly in schools serving children from low-income households.

By conclusion of the project in August 2018, DEEPEN aims to have helped establish a vibrant and dynamic market for private education.

Human capacity building required to sustain Lagos’ development - Ambode JOSHUA BASSEY

L

agos State governor, Akinwunmi Ambode, says to continually grow and sustain the development of the state, building human capacity is a must.

Ambode also submitted that the future for the state’s public service was dependent on continued development of capacities of workers, as well as innovative and creative use of resources to achieve more with less.

He spoke Wednesday at the conferment of the ‘award of excellence and outstanding in capacity building’ on Lagos State government by the Nigerian Institute of Training and Development (NITD) at its 26th annual trainers’ conference held in Abuja.

According to Ambode, for individuals to become more effective and productive, they must possess technical, administrative, and human skills and citizenship behaviour.

Represented by Benson Oke, his commissioner for establishments, training and pensions, Ambode argued that high performances had been known to be associated with organisations that exposed their human capital to

capacity development and trainings.

“From the repair of military vehicles to the processing of income tax returns, from surgery to urban planning, lean is showing that it cannot only improve public services but also transform them for the better.

“Crucially for the public sector, a lean approach breaks with the prevailing view that there has to be a trade-off between the quality of public services and the cost of providing them,” he said.

He explained that any organisation, the Lagos public service inclusive, could benefit from capacity development trainings by increasing productivity, helping to retain people, nurturing future managers, and increasing employee engagement.

“In our envisioned future of work, the importance of eliminating waste cannot be over-emphasised. Countless studies have shown that, with good and sound processes relating to management of time and resources, one finds that meagre resources can be extended to produce outstanding results. In other words, organisations and individuals can achieve more with less,” he said.

Tin-Can Customs intercepts cache of ammunition concealed in container, vehicle AMAKA ANAGOR-EWUZIE

T

he Nigeria Customs Service (NCS), Tin-Can Island Port Command, said on Wednesday, that it had intercepted a cache of ammunition concealed in a container and a vehicle during two separate operations that took place on July 9 and 10.

A statement signed by Uche Ejesieme, public relations officer of the command, stated that a 1 x 40-foot container with the number TGHU 60143419, which came in through the Ports and Cargo terminal of the port was found to contain live ammunition and jack knife.

According to Ejesieme, Musa Abdullahi, area controller of command, immediately ordered the transfer of the container to the Enforcement Unit where it was examined and found to contain 150 rounds of ammunition and pieces of various sizes of jack knife.

He said the container, the exhibit, and a suspected had been arrested and currently kept in the Customs Enforcement station

for further investigation.

He disclosed that the command had during routine tally operations, when vehicles were being discharged from vessel at Five Star Logistics Terminal, also discovered a black bag in one unpacked Ford Edge with the chassis number 2FMDK48C98BA05947.

“During further examination, it was discovered that the bag contained 149 rounds of 38mm calibre live ammunition; 92 rounds of 9mm calibre live ammunition; 2 rounds of 7.62mm calibre live ammunition; 11 cartridges of live ammunition; 12 expended empty shells of various calibres and one empty magazine,” he said in the statement.

He however added that the vehicle and the exhibit were being held at the Enforcement Unit of the command for further investigation, as impounded items contravened the schedule 4 Absolute Import Prohibition List item 17 of the Common External Tariff and the Section 46 of the Customs and Excise Management Act (CEMA) Cap C45 LFN 2004.

BUSINESS DAY

A7

Thursday 12 July 2018

C002D5556

BUSINESS DAY

A7

BUSINESS DAY

C002D5556

NEWS YOU CAN TRUST I THURSDAY 12 JULY 2018

Opinion When will our president begin to accept responsibility?

CHRISTOPHER AKOR Chris Akor, a First Class graduate of Political Science, holds an MSc in African Studies from the University of Oxford and is BusinessDay’s Op-Ed Editor christopher.akor@businessdayonline.com

O

ne of the hallmarks of great leadership is the assumption and acceptance of full responsibility for the performance and all decisions of the work unit. Leadership responsibility does not just entail accepting responsibility for just the leaders’ outcomes and results, but for the outcome of his/her team. United State President Harry S. Truman had a sign with the inscription “the buck stops here” conspicuously displayed on his desk. The clear message was to indicate that he did would not ‘pass the buck’ to anyone else but accept full responsibility for the way the country was governed. He demonstrated both in words and actions that the buck stops at his table and responsibility will not be passed on beyond that point.

Truman was Vice Presi-

dent to the popular Franklin D. Roosevelt and upon his death, just three months into his fourth term, succeeded him and took the unprecedented decision to allow all the members of Roosevelt’s cabinet to continue in office. He told them in no unclear terms that while he was open to their advice, only he would make policy decisions, and he would be fully responsible for all decisions made.

Truman popularised the phrases “the buck stops here” and “if you can’t stand the heat, you better get out of the kitchen” and used them constantly in his speeches to indicate that any leader worth his/ her onion would naturally take responsibility for everything that happens under his/her watch and not seek to pass the buck onto others.

Besides, there is a philosophical argument about agency. A free action comes with responsibility; the willingness to bear losses and enjoy gains for such agency. Denial of responsibility means there is no agency and the person involved is rather a victim. A victim bears or accepts no responsibility.

Of course, Western countries have popularised and accepted the culture of responsibility such that leaders frequently vacate their offices when things/issues/decisions go wrong. In 2016, we saw how

David Cameron resigned as Prime Minister of the United Kingdom just a year after winning a clear majority in the general elections following his gamble on Brexit that returned a leave verdict. He held himself fully responsible for the decision to conduct the referendum and felt “the will of the British people is an instruction that must be delivered” and he was not the person to deliver on that.

But while other societies have made progress in getting people and most importantly, leaders to accept responsibility for their actions, in Nigeria, we continue to blame others and external forces for the results of our actions. Nigerians generally define responsibility in Abrose Bierce’s words as “a detachable burden easily shifted to the shoulders of God, fate, fortune, luck or one’s neighbour. In the days of astrology it was customary to unload it upon a star”.

This is also the hallmark of leadership in Nigeria. It is standard practise in Nigeria that leaders take the glory for anything positive that happens under their watch but stridently deny responsibility for any failings or things that go wrong.

The practice did not begin with Buhari. It is a longestablished one. One of the worst offenders here is former president Olusegun Obasanjo.

Those who have read his ap-

palling memoirs “My Watch” will at one notice Obasanjo’s penchants to glorify himself to no end for any modicum of progress made under his watch and his pathetic attempts to deny responsibility for his actions and choices, which, in hindsight, have proved disastrous.

He will blame and eviscerate every other person – from his vice president, to his ministers, state governors, heads of agencies and the common man on the street – but refuse to accept any blame for his bad choices or outcomes of his choices.

But president Buhari has taken that culture now to a ridiculous level. From the blast of the whistle, he has blamed every other person – from the past administration, to corrupt politicians, foreigners, the judiciary, lawyers, and indeed anyone blameable aside himself, of course, and members of his cabinet – for all the ills of the country.

There was a groundswell of market optimisim that greeted the president’s assumption of office. But instead of the rolling out urgently needed market reforms and providing direction for the economy, the president sat back, did nothing until the tides began to turn and when it was too late, began rolling out a series of antiquated command and control policies which sought to control the foreign exchange market and the

economy. The effect was that foreign investors were forced to repatriate their investments and halt new ones, resulting in a crippling foreign exchange scarcity that led to severe job losses, hyper inflation, and severe dislocations in the economy.

But despite these clear evidences, the government and all its personnel continue to blame the past administration for the economic depression that was caused directly by the actions and inactions of the government.

What about corruption and the inability of the government to secure convictions, which is essentially due to shoddy investigation and shambolic and incompetent prosecution? The government would rather blame corruption for fighting back; lawyers who do their legitimate jobs for defending corrupt individuals; and the judiciary for frustrating the administration’s fight against corruption.

If the government is queried for incapacity and inability to handle the frequent herdsmen killings in most parts of the north-central and northwestern states, the president will blame climate change, the late Libyan leader, Muammar Gaddafi and his band of foreign fighters for the killings. When pressed over his government’s lethargic response and seeming culpability in the killings, he

blames opposition politicians and thugs for the crisis. Even when his son, an adult, went on a bike ride and had a crash, he blamed the security details attached to him for the accident.

When international organizations like the Human Rights Watch and Transparency International release reports detailing his administrations flagrant abuse of human rights and the country’s worsening corruption perception index, the government will blame them and accuse them of working for corrupt politicians to tarnish his administration’s image.

What about the world data lab that recently reported that Nigeria has overtaken India as the country with the highest number of those living in extreme poverty in the world?

Instead of looking at the policies of his administration that are directly responsible for throwing millions of Nigerians down the poverty lather, his government will rather blame past administrations.

Clearly, the president and his administration are not used to accepting responsibility because a culture of taking responsibility cannot exist in a culture of blame and recrimination. But we need to remind the President that he wasn’t elected to blame but solve problems. In Truman’s words: “if you can’t stand the heat, you better get out of the kitchen.”

Dangote: The travails of the only rich man in a village

IK MUO Ik Muo, PhD. Department of Business Administration, OOU, Ago Iwoye, Ogun State

I

always take delight in the words of our elders which convey pure wisdom and address issues that were yet to occur when they were coined. Our people say that the only rich man in any community is in trouble and indeed, very poor. I was not there when our people manufactured this adage but having become an elder myself, I have imagined what would have led to this weighty proverb. The lone rich man is in trouble because he is so busy attending to numerous villagers that he is distracted from his business. The goodies he doles to his kinsmen also eat deep into his surpluses and because of these two consequences, his business suffers.

He also attracts enmity, jealousy and conspiracy because he is unable to satisfy everybody or satisfy them as they would want while some would wonder: why not me. On the other hand, the community also suffers because everybody stops making efforts, while the

community fails to develop its collective capabilities and resources because it can always rely on the bigman . More so, because the people believe that his resources are limitless, their expectations keep on leapfrogging and at a certain stage they even wonder why the bigman would not adopt a red-cross model and just help everybody without waiting to be begged. The community’s problems become worse if the bigman throws his weight about, develops an above the law mentality or suffers from Arik syndrome (Arik started acting with impunity because it held the aviation industry by the throat; though, not anymore!)

I don’t know how to say it but most often, my business involves minding other peoples’ businesses. I have scanned the media, in the recent past and I have come to the unequivocal conclusion that the above scenario reflects the fate of Alhaji Aliko Dangote-AAD;( the man, his foundation and his awesome, diverse business interests), who is currently Africa’s biggest big man and the second most influential black man in the world. If not because of my self-effacement tendencies, I would have challenged both rankings because the rankers never assessed my net-worth nor my powerfulness which I believe will compete favourably with AAD. But

since he is my friend, I will let him be because I don’t want to lose friends over such minor issues.

Back to the issue at stake, this is the current reality in Nigeria. The solution of every economic and even social issue of the day in Nigeria( community) depends on or awaits the attention of AAD( the only rich man). These include perennial petroleum scarcity and power insufficiency, food insecurity, frightening level of unemployment, conservation of foreign exchange and the weight of the Naira, low industrialization index, horrible road network, poor quality of education and the oil-dependent nature of the economy. So pervasive is his involvement in these issues that I wonder if Nigeria needs an economic management team.

AADs $4.5bn agricultural project spread over 5 states, the $800m dairy farm of 50000 cows and 500m litres of milk by 2019, the $20m tomato factory in Kano aimed at checkmating the Chinese and the agreement with OCP Group of Morocco on fertiliser production would create more than 250000 jobs, diversify the economy, alleviate poverty and reduce the nation’s import bill, make Nigeria the largest rice exporter in the world by 2021 enhance food security, address rural urban drift and crash the price of fertilizer sold to farmers.

AAD’s refinery and petrochemical complex ( largest in Africa) with 650,000 BPD capacity, will end fuel scarcity, create 235000 and yield $500m in taxes within 3 years.

The Peugeot factory acquired in conjunction with some states and the truck assembly plant in association with Sino Truck, both for domestic use and export will also diversity the economy, create jobs and conserve forex. Nigeria has already attained self-sufficiency in cement production courtesy same Dangote,, who is also involved in the construction of Apapa Ports access roads and the 45kms Obajana-Kaba road, using his concrete model, which Fashola described as the way we should continue to build, going forward, in exchange for some tax remissions, which he also said is like credit advance to government. AAD Sugar Refinery, will generate 100000 jobs and ensure sugar self-sufficiency while he has just taken over the Kastina Songhai project abandoned 6 years ago. He has commitedN200bn for a unique university in Abuja, has donated a business school to the university in Kano and is funding an Education for Employment center in Abia state , demonstrating commitment to human capital development. He has commenced a $150m solar power project in Kano and built a N2bn in-

tegrated Dangote village for IDPs in Maiduguri. According to NEITI report, AAD contributed 56%(N16bn) of FGN tax from solid minerals for in 2013 and paid N5bn premium to insurers in 2016. In addition to operationally solving all the prroblems of Nigeria, he is also generating ideas as a member of the Nigerian Industrial Policy and Competitiveness Advisory Council I should not have bothered recounting all this because AAD has severally said so himself but I do not want to be accused of plagiarism.

Check out his speeches at the Guardian 2015 Man of the Year award, Nigerian Economic Summit, Kastina Economic & Investment Summit, NigerianKenya business summit, when the VP visited his refinery and at the corporate Council for Africa event. In all these, he declared his commitment to turning around and diversifying the economy, working hard to take the economy to the next level, building a refinery that is higher than the combined capacity of all refineries, a fertilizer capacity that is ten times more than what is available in Nigeria today, generate 12000MW, more than thrice what Nigeria currently generates and export refined oil rather than importing and creating Jobs elsewhere, list his refinery et al on the NSE and help NSE to outgrow Johannesburg

Stock Exchange and how the rate of youth unemployment in Nigeria gives him sleepless Nights( a statement even our PMB has not made), assuring that Nigeria( and Africa) would soon become the world’s food basket. AAD has said and continues to say the right and heart-warming things. Unfortunately however, these are the kinds of statements that should emanate from Kemi Adeosun, Godwin Emefiele, Udo Udoma whoever is the chairman of the EMT, and in sane climes, from the president himself.

So, like the only rich man in the village, AAD has taken on all the responsibilities. Already other villagers are grumbling: Ogun State governor complains that Dangote trucks destroy the roads; Ndigbo say the only Dangote investments in ala-Igbo are deaths and traffic jam by his reckless drivers and his trucks; the FCT in 2016 rejected his Salah gifts; some people complain that he cornered an unfair share of our forex, enjoy great tax waivers, is becoming monopolistic and is muscling out other players, citing his spat with Otedola, Ibeto and BUA. Our only luck so far is that Dangote does not overtly throw his weight about.

If he were to behave as some of his drivers….

Note: the rest of this article continues in the online edition of BusinessDay@https:// businessdayonline.com/

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Ghana Office: Business Day Ghana Ltd; ABC Junction, near Guinness Ghana Limited, Achimota – Accra, Ghana.

Tel: +233243226596: email: mail@businessdayonline.com Advert Hotline: 08116759801, 08082496194. Subscriptions 01-2950687, 07045792677. Newsroom: 08022238495 Editor: Anthony Osae-Brown. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.

DAY IN ASSOCIATION WITH

Thursday 12, July 2018

ww.businessdayonline.com

facebook.com/businessdayonline

@businessDayNG

C002D5556

2

BUSINESS DAY

Thursday 12, July 2018

ww.businessdayonline.com

facebook.com/businessdayonline

@businessDayNG

C002D5556

ANALYSIS

2018 FIFA WORLD CUP RECORDS ONLINE VIEWING NUMBERS Anthony Nlebem, reporting from Moscow

T

he 2018 FIFA World Cup Russia has seen record online viewing figures, thanks to advances in OTT technology and the burgeoning mobile media streaming market.

International media ratings measurement service Conviva has revealed that during the first week of the World Cup, 393 million plays of matches were successfully streamed, the equivalent of 6.9 billion viewing minutes, via 59 million unique video streaming apps.

Cloud delivery platform Akamai reports that viewers of the first round of Russia 2018 streamed 65% more data over the Akamai Intelligent Platform than they did during the whole of the Rio World Cup just four years earlier. The number of streams running concurrently hit a record 9.7 million, when Mexico played Sweden at the same time as South Korea played Germany on June 27, 2018. The viewing peak the company recorded hit 5 million for the entire tournament in Rio. This also occurred when two games were played simultaneously – the US versus Germany and Portugal versus Ghana.

Akamai reports that peak bandwidth for streaming in the first round in Russia 2018 hit 23.8Tbps, compared with 6.99Tpbs at the Rio World Cup. In fact, 75% of all matches played in the first round in Russia have exceeded the peak bandwidth for the entire Rio tournament.

British public broadcaster the BBC reveals that the England versus Tunisia Russia 2018 match played on June 18, 2018, was watched by three million people via BBC iPlayer, this was a record breaker for the platform. All eyes are now on the streaming figures for the England versus Sweden game due to be played at 3pm GMT on July 7, 2018.

Editor: Anthony Nlebem Tel: +234 803 836 9508 Email: tony@businessdayonline.com

2030 WORLD CUP: ALGERIA TO JOIN BID WITH MOROCCO, TUNISIA

A

lgeria is considering submitting a joint bid to host the 2030 FIFA World Cup with Morocco and Tunisia, Algeria’s sports minister said, just weeks after Rabat lost out to a US-led bid to host the 2026 tournament with Canada and Mexico.

Sports Minister Mohamed Hattab told reporters that his country, which has at times been at odds with its neighbour Morocco – notably over the Western Sahara issue – would “study the possible candidacy of the Maghreb countries for the organisation of the World Cup”.

“An application from the Maghreb with Morocco, Algeria and Tunisia can be achieved through existing infrastructure as well as future projects,” said Hattab.

“When we look at our cities, with the sporting and culture facilities present, we are able to consider that we can host major world events.”

Morocco, which has failed in all of its five attempts to host the tournament, voiced its interest in bidding for the 2030 edition immediately after learning it had failed to secure the 2026 run.

Moncef Belkhayat, a member of Morocco’s failed 2026 bidding committee, said in June that King Mohammed VI had the ambition to see the North African country host the event in 2030.

“I’m delighted his Majesty King Mohammed VI has taken the decision to make Morocco a bid nation for World Cup 2030,” Belkhayat said at the time.

“It shows also our perseverance to do better and better for the sake of Morocco and worldwide football.”

Both Morocco and Tunisia made it to this year’s tournament but were eliminated at the group stage while Algeria, absent in Russia, made it to the second round in Brazil back in 2014.

Designed by: Aderemi Ayeni Tel: +234 703 435 2828 Email: aderemi.ayeni@businessdayonline.com

3

BUSINESS DAY

Thursday 12, July 2018

ww.businessdayonline.com

facebook.com/businessdayonline

@businessDayNG

C002D5556

NEWS

T

he Supreme Committee for Delivery & Legacy (SC), the organisation responsible for delivering the infrastructure required for the 2022 FIFA World Cup Qatar, will be giving fans at the 2018 FIFA World Cup Russia a taste of things to come when the tournament heads to Qatar in a little over four years’ time – with a series of free creative and interactive installations and events in Moscow and Saint Petersburg from 7th -15th July.

The SC has partnered with a range of Qatari organisations to launch creative campaigns that will showcase Qatar as a prime cultural and sporting destination and bring the country’s unique 2022 FIFA World Cup tournament concept to life.

Majlis Qatar – the SC and its Qatar-based stakeholders will be hosting Majlis Qatar, a three-tiered pop-up space in the centre of Gorky Park, Moscow, that resembles a Bayt Al Sha’ar – a traditional tent common throughout the Gulf region, and which serves as the inspiration for the 60,000-seat 2022 FIFA World Cup venue, Al Bayt Stadium – Al Khor City. Majlis Qatar will host the public, media and VIPs, and will showcase the very best of Qatari hospitality.

Qatar Elements – As one of the centerpieces of the campaign, the SC will also host the world’s first floating multimedia museum.

Located on the Moskva River, near Gorky Park, museum visitors will be invited to travel to Qatar through an immersive multimedia show, where informational graphics on Qatar’s hosting plans will be projected on to walls, appearing to flow down into the river’s

water.

Qatar-Russia Portals – The SC will also be launching a series of innovative ‘portals’ that will connect cultures and communities around the world. Digital portals placed across Doha, Saint Petersburg and Moscow will allow fans to interact between the cities via live broadcasts, giving fans in Russia a realtime view of what life is like in Qatar. The Qatar-based portals will be located in Hamad International Airport, the popular Souq Waqif market and Ali Bin Hamad Al Attiyah Arena, where the SC is hosting Qatar Fan Zone. @Roadto2022 Exhibition – Furthermore, Moscow’s famous GUM department store will also play host to a football exhibition showcasing FIFA World Cup™ memorabilia and

exhibits from Qatari stakeholders, including Qatar Museums and the Sheikh Faisal Museum. This is in addition to two stunning oryx – the national animal of Qatar – statues painted by a Qatari and a Russian artist.

Speaking ahead of the fan-focused activities, Fatma Al Nuaimi, the SC’s Communications Director, said: “It’s important that we give football fans a real taste of what’s to come when they visit Qatar for the next FIFA World Cup. Not only do we want to update them on how much progress we’ve made in our preparations for the tournament since we won the hosting rights in 2010, we also want to introduce them to the country, our culture and what they can expect in 2022.

“Qatar is a vibrant country blending a rich cultural history with world-class facilities and cutting-edge technology. These events will showcase all of this to football fans and families here in Russia, and I hope we encourage many of them to attend the first World Cup in the Arab world when we host in just over four years’ time.”

Underpinning all these exciting activities will be traditional and digital advertising campaigns across key locations in Moscow and Saint Petersburg.

The Qatari stakeholders contributing to the success of Majlis Qatar include the Ministry of Culture and Sports, Qatar Tourism Authority, Qatar Airways, Qatar Museums, Qatar Foundation, Katara, Souq Waqif, Doha Film Institute, Qatar Football Association, Qatar Olympic Committee, Aspire, Al Shaqab, beIN SPORTS, Al Kass, Ooredoo and the International Centre for Sports Security.

4

BUSINESS DAY

F

Thursday 12, July 2018

IFA president Gianni Infantino has signaled that the global football governing body could review the fair play rule as requested by Senegal, adding that he believes Africa will perform better at the next World Cup in 2022.

Infantino’s remarks follow Senegal’s official complaint to FIFA over the conduct of Japan, which qualified to the knockout stages at the expense of Senegal, from Group H in Russia.

Senegal which was tied with Japan on points obtained, goals scored and goal difference, after playing all three group stage games, was penalised for having two more yellow cards than the Asians as per the FIFA fair play conduct regulation.

Senegal’s football governing body however wants FIFA to consider negative football tactics as part of its fair play rule, arguing that

ww.businessdayonline.com

facebook.com/businessdayonline

Japan resorted to passing the ball around in their own half during the last quarter of the game, instead of pressing for an equaliser.

“As for the rules, you always learn. You always have a de-brief after and see what you can do better,” Infantino said, in an interview with the BBC, confirming that the ruling will be reviewed after the tournament.

Senegal’s elimination completed Africa’s worst showing at the World Cup since 1982.

All five African teams including Egypt, Morocco, Nigeria and Tunisia were eliminated after group stages.

Asked whether Africa’s premature exit saddened him, Infantino said: ‘Of course’.

“The World Cup is for the whole world and the African teams were very, very close at the end.”

He added that he believes the continent will fare better at Qatar 2022.

@businessDayNG

C002D5556

“An Asian (team) made it – an African not – but I think they will be ready soon for the next one,” he said.

Infantino, who insisted on the use of video technology at the World Cup despite criticism and warnings that it was too soon to introduce the new system at the biggest football stage, said he is happy with the progress made so far.

“I think it is working pretty well. We have had a very, very positive outcome so far so we have to continue to keep the level high,” added the Swiss-Italian.

Video Assistant Referee (VAR) has caused debate among football fans despite Fifa claiming on Friday that it has enabled match officials to call 99.3% of incidents correctly.

The World Cup, whose quarter-final stage begins on Friday, will end on 15 July when the Russian capital Moscow hosts the final.

BUSINESS DAY

5

Thursday 12, July 2018

ww.businessdayonline.com

facebook.com/businessdayonline

@businessDayNG

C002D5556

NEWS

Anthony Nlebem, reporting from Moscow/Russia

I

t was a historic moments for seventeen Nigerians who got the most astonishing package of the year, the 2018 FIFA World Cup Experience. Having the benefit of viewing a live World Cup can never be compared to watching matches on a TV screen.

The elation and fulfillments the fans derive from this moment is in comparable, its more exciting and fulfilling watching the games live at the stadium and having a real-time experience with the players, fans, coaches and the atmospheric beauty of the stadium that makes you part of the game.

My 2018 FIFA World Cup experience in Russia is something that I will live to remember as the fun, excitement and the opportunity of hanging out with fans from across the continent that specifically came to cheer their country to glory.

Seventeen lucky Nigerian youths had a lifetime football experience in the Coca Cola Score a Trip to Russia promo when the leading premium soft drink giant, Coca Cola Nigeria took them to St. Petersburg, the ancient city in Russia with a population of 4.991 million and boost of the most expensive stadium

ever built, the St. Petersburg stadium.

At a cost of $1.1 billion at current exchange rates, it is considered one of the most expensive stadiums ever built. With a capacity of 56,196 for regular league matches, but increased to 68,000 for the World Cup. They also had a City tour to beautiful and historic places like; Grand Palace at Peterhof, Peter and Paul Fortress, FIFA Fan Park, the Winter Palace and Hermitage Museum, the largest art gallery in Russia and is among the largest and most respected art museums in the world.

Jeoffrey Ekoja, a civil servant working with the Kaduna state Polytechnic was so stunned at what he saw.

“Waoo, the experience has been fantastic in Russia, a good place with nice people with warm welcome for visitors; the environment is amazing and honestly, I enjoyed my stay here in Russia. But the challenge for us is the language barrier that makes it difficult for people to communicate effectively, “ said Ekoja.

Speaking of his first experience of watching a live FIFA World Cup game after watching Sweden play against Swaziland at St. Petersburg stadium, Ekoja was full of words.

“Very happy to watch live here at St. Petersburg stadium Stoke City’s midfielder Xherdan Shaqiri, Arsenal’s Granit Xhaka and

very interesting to see all the players on TV live and direct. This has really brought joy to my life and I am grateful to Coca Cola Nigeria for the privilege to watch a live World Cup match.”

“Overwhelmed to see fans cheering their team teams and the jubilations were incredible, we mingle and make new friends. Coca Cola has given us the biggest World Cup experience.”

Koja could not hide his feelings about the beautiful edifice at St. Petersburg stadium.

“Woo!!! I was so fantastic, I have never seen such stadium in my life and it’s a dream come true to be here in Russia. When I return back to Nigeria, I will tell my friends and family my World Cup experience, especially my experience at St. Petersburg. “ Enugu born Godwin Ananmani Chukwuemeka, a psychology graduate from Eastern Mediterranean University in Turkey also shared his historic moments with Coca Cola World Cup Experience of watching a World Cup Live game for the first time.

“After my studies in Turkey, I came to Nigeria to process my documents for my Masters programme, before I was selected among the seventeen lucky winners in the Coca Cola Score a Trip to Russia promo.

“Though it’s not my first experience to be in a cold country, it’s awesome seeing beautiful structures in St. Petersburg. A great opportunity to see this nice and sweet environment; seeing the electric powered buses is an incredible experience,” Chukwuemeka revealed.

“Watching a World Cup live game is a moment I will never relinquish for a long time, the live experience is much different from TV screens. Live experience affords you the opportunity to see the players and meeting with them and their fans.”

“There are lots of rich Nigerians who wished they had this opportunity, for me having this privilege to watch a live World Cup game at the magnificent St. Petersburg stadium is something I can’t express in speech, but am extremely delighted to be among the lucky winners. I feel much fulfilled with this Coca Cola World Cup experience in Russia. This has given me hope that many opportunities lies ahead of me.”

“I saw what I have never seen before, Turkey have a metro train stations, but not what I have seen in Russia. A visit to the galleria shopping mall was also awesome where top brands in shoes and clothing were on display.

A sight tour to Saint Peters and Paul Cathedral shows Russia has a great historical background, “ he added.

Christopher Rita Osayameh, from Benin in Edo state and the only female among the lucky 17 lucky winners in the Coca Cola Score a Trip To Russia Promo said she could not believe that she could be in Russia.

“I have seen live differently, and the atmosphere here is beautiful. I was really fun to watch a live World Cup match in a foreign country. The stadium edifice; I have never seen such stadium in my life. The sight tour to Peter and Paul fortress and boat cruise will forever live in my memory.”

6

BUSINESS DAY

Thursday 12, July 2018

ww.businessdayonline.com

facebook.com/businessdayonline

@businessDayNG

C002D5556

B

ehind the impression of Russia’s smooth-running World Cup are legions of migrant workers from Central Asia, who built the stadiums and keep them running, staff concession stands, and clean up after fans, who revel through city streets.

They are among millions of migrants who perform menial jobs across Russia, and face routine police harassment and ethnic profiling. They are accused of depressing wages and plotting terrorism, yet unlike in Europe or the U.S., no one talks of building a border wall to keep them out. That’s because they form a pillar of the economy and aid Vladimir Putin’s geopolitical strategy — and without them, Russia might not have managed to host a World Cup at all.

As world-class soccer unfolds in their midst, orange-vested migrant workers take selfies with fans and steal glimpses of a match on a co-worker’s cell phone, or watch replays on a dormitory TV after a 12-hour shift. You won’t hear them complain.

“This country took us in, and gives us work,” said Bobur Ulashov, who left his village in southern Uzbekistan five years ago in search of a job. Today, the 37-year-old sweeps rubbish into his dented mental dustpan and plucks beer cups out of bushes at Moscow’s official World Cup fan zone.

He has little interaction with the visiting crowds — “they see the orange vest and keep walking,” he shrugs. He doesn’t hesitate when asked who he’s rooting for. “Russia. Who else?”

Russia provides work to people like Ulash-

ov, who sends $100-200 home every month to his 6-year-old son, wife, parents and siblings.

And people like Ulashov provided Russia cheap labor to prepare for the World Cup. “Migrants made up the main workforce” in the construction of stadiums and transport infrastructure for the tournament, said Valery Solovei, a professor at Moscow’s MGIMO foreign policy institute and an expert on immigration and nationalism. “Without migrant workers, Russia couldn’t have built all these things so quickly.”

Building Workers International says 21 people died on World Cup construction sites.

Human Rights Watch documented hundreds of complaints from World Cup workers, finding that many had no written contract of any kind, and some were working in temperatures of minus 25 degrees Celsius (minus 13 Fahrenheit) with one indoor break in a nine-hour shift.

“Abuses included non-payment of wages, significant delays in paying wages, very unsafe working conditions in some sites, and also retaliation against workers who complained,” said Yulia Gorbunova of the group’s Moscow office.

Russia’s World Cup organizing committee says it worked with FIFA on an inspection system to root out alleged labor violations and

FIFA said last year that it had seen a sharp fall in the “number of issues” at Russian construction sites after its inspections. Neither the Russian organizers nor FIFA provided figures or details on what they found, or said whether anyone was prosecuted.

That’s a concern for Russia’s workers and for the 2022 World Cup in Qatar, where migrant workers perform nearly all menial labor and have few legal rights.

Migrants staffing Luzhniki Stadium, Moscow’s 81,000-seat primary venue, insist their conditions are good - 30,000 rubles ($470) a month during the tournament, with one or two days off per week. But most didn’t want their full names published for fear their employers would punish them.

Gafirjon Kurbonov isn’t afraid to talk. He helped lay asphalt in St. Petersburg as Russian cities cleaned up ahead of the World Cup, and now works as a registered taxi driver in Moscow. His wife and two small children have joined him, and he wants to settle here.

“Business is good. There are so many foreign (fans),” he said in rapid-fire, Tajik-accented Russian. And after the World Cup is over? “There will always be work.”

Even harder than obtaining working papers and a fair salary is battling discrimina-

7

BUSINESS DAY

Thursday 12, July 2018

tion. Security officers guarding the metro system systematically single out Central Asians to check their bags and documents, ignoring those with more Slavic features.

Russian authorities have said identity and bag checks are part of overall security necessary to protect the country.

When Russia sank into recession because of Western sanctions over the annexation of Crimea, Central Asians took blame for pushing down wages, inciting terrorism and petty crime. a Kyrgyz taxi driver plowed into pedestrians near Red Square early in the World Cup, social networks buzzed with abusive comments about “guest workers” who turn to terrorism — even though Russian authorities insisted it was just an accident by a sleep-deprived driver.

Central Asian migrant workers have been linked in the past to Islamic extremism, however. “Since they are feeling social pressure, they radicalize,” Solovei said. Discrimination “spawns a feeling of protest.”

Yet when nationalist politicians campaign to impose visas on Central Asians, government officials balk, fearing that would cost Russia its influence in the strategic region. And the debate quickly dies down.

Russia has proportionately more migrant workers than any country in Europe, Solovei said — some 6 million according to official statistics, 10 or 11 million according to unofficial estimates. Most come from the former Soviet republics of Central Asia — ancient Silk Road towns of Uzbekistan, impoverished valleys of Tajikistan on the Afghan border.

Some settle in Russia and become a part of the fabric of multi-ethnic cities like Moscow. Others remain guest workers for the long term, returning home every year for weeks or months at a time — and supplying remittances that make up a substantial chunk of Central Asia’s national budgets.

A Kyrgyz street sweeper named Gulnara showed off cell phone pictures of her young adult children back home, whom she hopes to see this summer. That helps her face the challenge of cleaning the mess left by soccer fans on historical streets near Red Square.

At the St. Petersburg stadium, a maintenance worker waited shyly in a corridor as fans poured out of the first-round match between Russia and Egypt. Seeing the jubilant Russian faces, he guessed that the home team had won, but had to ask a passerby the score.

ww.businessdayonline.com

facebook.com/businessdayonline

@businessDayNG

C002D5556

NEWS

ENGLAND FANS USING FAKE ID HACK TO GAIN ACCESS TO STADIUM

E

ngland fans are exploiting a loophole in red tape for the World Cup in a desperate bid to reach Russia – but risk being turned away if their subterfuge is discovered.

As part of the agreement between FIFA and the Russian government, bona fide fans do not require visas for visits to the host nation that start up to the day of the final, 15 July.

Instead, they can travel with a “Fan-ID”, which is issued free in a simple online process. It takes around five minutes and approval is normally almost instant.

As well as basic passport information, the application also requires a ticket number or FIFA booking reference.

Prior to the tournament, it was presumed that the FIFA Fan-ID was electronically locked to the match ticket. But The Independent has verified that someone else’s ticket number from a previous game is sufficient to apply successfully for a Fan-ID. Supporters keen to follow England’s progress through the knockout stages have used a number of strategies to obtain a ticket number.

On Twitter, a supporter identified as “InstantFanID” is offering to share his booking details, telling fellow fans: “I will give you a ticket reference number and you PayPal me a pound or two as thanks.

“But you get the ticket ref first – trust system.

Message me for deets.”

Other fans have taken the numbers from tickets for past matches that are being offered for sale online as sporting memorabilia.

Using a ticket number from an earlier game, The Independent successfully applied for a FanID for a supporter who does not plan to visit

Russia.

But anyone seeking to use a document obtained in this way to try to enter Russia is running significant risks.

The organisers say: “The electronic form of a Fan-ID provides the entry of a spectator to the Russian Federation, the exit from the Russian Federation and guarantees the issue of a Fan-ID in laminated form” – which supporters require to enter any of the stadiums.

But there is the added stipulation: “On condition that the spectator possesses the ticket for the 2018 FIFA World Cup.” Many fans report that they have been admitted into Russia without having to show a valid ticket.

Airlines, which face fines if they carry ineligible passengers to Russia, may also require proof in the form of a match ticket before the traveller is allowed on board.

Fares to Samara are surging as demand increases from England fans. The main links are via Moscow or Istanbul, with fares typically around £1,400 return.

Some fans are turning their attention to the venue for the next match, were England play Croatia in semi-final in Moscow on Wednesday 11 July.

British Airways has confirmed it may deploy larger aircraft on the route. At present it has three flights a day between Heathrow and Domodedovo airport in Moscow. One is a Boeing 787 Dreamliner, with the other two using narrow-bodied Airbus A321 jets.

One or more of these services could be switched to a much larger Boeing 777 if demand is sufficiently strong.