Governor Emefiele outlines 8-point agenda for better post Covid-19 Nigeria
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overnor of the Central Bank, Godwin Emefiele Tuesday outlined an eight-point agenda for turning the pain from the current Coronavirus tragedy into good for Nigeria. “I believe we must now envision and work toward a Nigeria
with the cutting edge medical facilities to provide world class care to the sick and vulnerable, enable our universities and research institutions to provide the requisite education and training that is required to keep these ecosystems functioning sustainably and efficiently, and
millions of Nigerians employed in meaningful and well-paying jobs. This is the Nigeria that we
Full text at the back page must aspire to build.” To achieve this, he said, firstly Nigeria would require building a
base of high-quality infrastructure including reliable power that can engender industrial activity; supporting both smallholder and large-scale agriculture production in select staple and cash crops. The apex bank chief also listed the urgent requirement
to creating an ecosystem of factories, storages, and logistics companies that move raw materials to factories and finished goods to markets and using our fiscal priorities to create a robust educational system that Continues on page 27
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World Bank warns ‘copy-cat’ lockdowns could jeopardise African economies ...experts suggest alternatives for big informal economies like Nigeria SEGUN ADAMS
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s African governments deploy a series of emergency measures to fend off the novel coronavirus, structural features of their economies should shape the policy responses that are designed and implemented, said the World Bank in a recent report, warning that a copy-and-paste of western responses may not serve the continent well. Lockdown, restriction of Continues on page 27
Inside Some members of the Lagos State Executive Council after a meeting with Governor Babajide Sanwo-Olu on the government’s palliative measures at the Government House, Marina. L-R: Gbolahan Lawal, agriculture commissioner; Abisola Olusanya, special adviser, agriculture; Obafemi Hamzat, deputy governor; Rabiu Olowo, commissioner for finance; Gbenga Omotoso, information and strategy commissioner, and Gboyega Soyannwo, deputy chief of staff.
Nigeria’s economy to contract by-3.4% in 2020, says IMF P. 26
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Tiv/Jukun crisis: Stakeholders meet in Nasarawa to find lasting solution Solomon Attah, Lafia
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he renewed violent attacks at the border communities of Benue and Taraba states have necessitates the intervention of Nasarawa State government in an attempt to find lasting solutions to the aged-long crisis between the Tiv and Jukun ethnic nationalities. Just recently, according to report, three persons were killed, with scores injured at Jootar, a border settlement mostly dominated by Tiv people, which attracted public outrage and concerns. This is the basis that informed why Benue and Taraba states stakeholders, led by their deputy governors, Benson Abounu and Haruna Manu and some selected traditional rulers of the embattled border communities, gathered in Lafia, the Nasarawa State capital, to fine-tune modalities for peaceful resolution of the recurring decimal in the two states. Nasarawa State was however chosen as a neutral ground, due to its peaceful disposition and the presence of Jukun and Tiv extractions living in some parts of the states. In his opening remark at the meeting, Governor Abdullahi Sule who described the meeting as timely, said, “There is no way to celebrate the Easter than with peace, because Christ himself preach nothing but peace and therefore this is the best time to talk about peace.” “When Nasarawa State was asked to host a peace meeting as this, then I say, let our brothers
from Taraba and Benue states come and have their meeting here and I am hoping by the end of the day, since Taraba is very far from Nasarawa, then the deputy governor came down ward, and will go and sleep in Benue before proceeding to Taraba.” While appreciating the two states for the move for peaceful resolution, Governor Sule said, “The same issues we have in Taraba are the same issues we have in Benue and so also in Nasarawa State.” He said his visit to Benue State when he assume office as governor was as a result of the frequent clashes at the border communities of the two states, aimed at finding a lasting solutions to this kind of crisis. “I made it very clear during the visits that, there are Tiv people who are indigenes of Nasarawa State, and any time we have problem and they run back to their home state, please send them back to Nasarawa so that they can solve their problems right here in Nasarawa. “And am calling on my time colleagues, the deputy Governors let them do same. Let them preach to our people. We are the same people, each one of them, let them see the two states as their own, let them not consider a situation where any time we have a problem, we run to where we have the majority of their people, If we continue to do that, we will not solve this problem. “So I pray and hope that we can actually look at each other in the face and tell each the truth and find lasting solution to whatever we are doing.
COVID-19: Edo urges employers not to lay off staff during outbreak …as Stella Obasanjo Hospital isolation centre receives first patient
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do State government has urged employers of labour in the state not to lay off staff, but rather explore human-faced measures to support workers who are at home due to the restrictions imposed to halt the spread of coronavirus (COVID-19). The state governor, Godwin Obaseki, who made the appeal, said such measures were necessary because of the peculiarities of the fight against COVID-19, which has disrupted the world. According to Obaseki, “I encourage employers not to lay off staff this period, but to explore human-faced measures to support employees during this crisis. This, my people, is a time to show love and a sense of community, so we can win this war as one united people driven by our common zeal to survive and thrive.” The governor assured that the state government has put measures in place to check the spread of the virus and would continue to review the measures daily to ensure that it curtails the spread of the virus. Noting that the state government has trained healthcare workers to attend to the dynamic changes required to arrest the spread of COVID-19, he said, “Health workers who are leading the fight against COVID-19 have now been trained, and they will man the first set of 50
screening centres, starting in the local government areas where we have experienced outbreak of coronavirus.” “We want to screen up to 500,000 citizens in Edo over the next few weeks, and I am pleased to inform you that we now have 2 additional testing facilities in Benin City, where we plan to test up to 5,000 citizens. We will review our current policies when we obtain sufficient data and evidence from the screening and testing,” he added. Noting that it was necessary to make sacrifices to check the spread of the virus, he said, “I want to use this opportunity to appeal to all citizens to join government to look out for, and take care of the most vulnerable and weakest persons in our communities.” Meanwhile, the state commissioner for health, Patrick Okundia, has revealed that the Stella Obasanjo Hospital Isolation Centre (SOHIC) has commenced treatment for the first COVID-19 patient, noting that the patient was responding to treatment. The commissioner, who spoke with journalists in Benin City, said the state had recorded 14 confirmed cases of COVID-19, while contact tracing of 299 persons was ongoing across the affected local government areas (LGAs).
Food items donated by Victims Support Fund (VSP), COVID-19 Task force, being distributed to households at Malaysia Internal Displaced Persons Camp in Abuja as palliative against COVID-19 NAN
COVID-19: Communities resort to self-help against robberies as lockdown takes toll CHUKA UROKO
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ome Lagos communities including Idimu and Egbe in Alimosho area of the state have resorted to self-help in protecting themselves against armed robbery attacks amid the biting impact of the lockdown and sit-at-home order on the state by the Federal Government. These communities have been frequently attacked by an armed robbery gang known as ‘One Million Boys’ who move in large numbers, breaking and looting shops stocked with food materials and beverages. On Monday night, when the ‘boys’ came as usual to rob shops on Liasu Road where they had robbed twice in the last couple of weeks, they were stoutly resisted by young men living in the area
who constituted themselves into a ‘vigilante’ and repelled the ‘boys’. When BusinessDay visited the communities Tuesday afternoon, it was gathered that it was a rough and tough duel between the robbers and the vigilante. Heaps of ashes from burnt tyres laced with pieces of broken bottles littered the whole length of the well over 2-kilometre road. “We did not sleep at all last night; it was as if there was a war. If not for our boys who decided to confront them, many shop owners on this road would be crying and counting their losses now,” a resident, who introduced himself simply as Adams, told our correspondent. Another resident who gave his name as Idowu said he was worried with the frequent armed robbery attacks in their commu-
nity which, he said, was known for being safe and peaceful but had suddenly become a risky area. “We know where all these things are coming from. Government says everybody should stay at home without any provision for the people. Hunger has taken over many homes and everybody is angry. “Don’t forget that everybody is now idle without income. Okada riders are idle; Danfo drivers are also idle and all those who used to make their money from okada, keke and danfo operators are also idle; what do you expect? Idowu queried. Cyril Emeh, a public health worker, commended the federal government for extending the lockdown by additional 14 days, but noted that it was not enough to extend the lockdown without
addressing the social, economic and security concerns of the people in the affected states. “Lagos, the federal capital territory (FCT) Abuja and Ogun state in which the federal government has extended the lockdown should get special attention in terms of relief materials. What we have seen so far as palliatives from the government is an insult. It makes no meaning,” Emeh said. Asked if there was police presence during the clash with the armed robbers, Idowu said he could not tell. “If they came, I do not know, but I want to advise that people should protect themselves. This is the third time these boys are coming to this area; police know and they are supposed to be patrolling this road every night. That is yet to be seen,” he fumed.
COVID-19: TG Arla announces N150m intervention Daniel Obi
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n line with its commitment to the health and well-being of Nigerians, especially during this challenging period of the COVID-19, TG Arla Dairy Products LFTZ Enterprise, maker of Dano Milk, has announced an intervention worth N150 million to support the efforts of the Federal Government of Nigeria in combating the spread of the global pandemic. The intervention includes a donation of N100 million through Tolaram Group to the private sector coalition fund and distribution of N50 million worth of products free to its consumers in supporting them to stay healthy and safe during this period. According to Peder Pedersen, managing director of the company, in a statement, this gesture is in line with the philosophy of the company, especially during a period like this. Pedersen commended the Federal Government through the Federal Ministry of Health, Nigeria Centre for Disease Control (NCDC) and most importantly the health workers who are at the forefront of efforts aimed at containing and managing the spread of the virus.
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…N100m as part of Tolaram Group, N50m worth of products to consumers Pedersen disclosed that the N100 million donations by the company would be disbursed through Tolaram Group to the private coalition committee established by the Central Bank of Nigeria to raise funds from the private sector to fight the pandemic. “As part of the private corporate organizations operating in Nigeria, we are pleased to support the Federal Government and Nigerians during this very challenging period,” he said. Also speaking, Ifunanya Obiakor, head of marketing, explained that about 50,000 households would benefit from the donation of the N50 m worth of products. She disclosed that the Lagos food bank initiative would be used in distributing the products directly to the consumers not leaving out border towns like Badagry and the inhabitants of Lekki free trade zone where its factory is located. She said, “As one of the food companies offering essential products to the populace and exempted from the ‘Lockdown’ order, critical measures are in place to ensure that in compliance with the WHO and local regulations, operations are ongoing in order to deliver our nutritious products
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to the Nigerian consumers”. She further stressed that the company has also embarked on an enlightenment and awareness campaign to educate con-
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sumers on Covid-19 based on WHO guidelines for safety at this period using its website and brand-owned social media platforms.
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COVID-19: Food availability shows FG policies currently working Josephine Okojie
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he Federal Government i m p o r t restriction policy and the emphasis o n h o m e - g row n f o o d s driven by initiatives such as the Anchor Borrowers Programme has indeed been the saving grace for food security amid the novel coronavirus outbreak in the country. The resilience the country has built unwittingly against the COVID-19 pandemic in the area of food is a testimony of the Anchor Borrowers Programme and import restriction policies of the government. The recent approval of 100,000 metric tons of grains from the strategic reserves underscores the workability of an emerging agro-based diversified economy, which if sustained will free the c o u nt r y w a s t e f u l f o o d importation. “The ABP and border closure policy of the government has helped in boosting our food p ro d u c t i o n b e f o re t h e
coronavirus outbreak,” said Ibrahim Kabiru, national president, All Far mers Association of Nigeria. “This is why we still have enough food amid the coronavirus spread but if the lockdown persists we might start seeing food prices escalating, owing to the obstruction in the supply chain,” Ibrahim said. The Central Bank of Nigeria’s ABP initiative which started since
2016 to provide singled ig i t i nt e re st rat e s f o r smallholder farmers and guarantee off-takers in key staples has impacted the country’s agricultural sector tremendously and increased food production. The ABP and FX restriction initiatives have also created a sustainable value chain in rice and other grains in the country. Kabirus noted that farmers are currently unable
to go to their farms as often as possible owing to the lockdown and supply of key inputs is also being obstructed by the directive. He stated that the COVID-19 pandemic is a risk factor to the country’s food security and its impact will be greatly felt next year if smallholder farmers are unable to boost their productivity. “We need to grow enough and replace the grains that
were taken from the strategic res er ves as a stimulus package for Nigerians during the pandemic,” he said. Currently, the coronavirus pandemic is penetrating into global supply chains as countries continue to enforce lockdown policies to curtail the spread of the virus. Globally, food prices are now surging as countries place restrictions on export, forcing prices of rice and wheat – two key staple foods to make rapid climbs in the global market. The situation is creating an added financial burden o n c o u nt r i e s t hat re l y on imports as the virus continues to shatter their economies and erode purchasing power. Before the ABP initiative started in 2016 and FX restriction, Nigeria used to be among the top importers of rice – a key staple in the Nigerian diets. But the narrative has changed with the initiative a n d F X re s t r i c t i o n f o r importers of rice. Nigeria’s rice production has increased significantly and the country is able
to meet up with its local demand for the grain. The ABP initiative has led to an increase in the country’s paddy production from about four million to seven million metric tons annually, according to data obtained from the National Bureau of Statistics (NBS). Numbers of rice mills both integrated and cottage mills have also increased by more than 50 percent as the government and private sector continues to make more investments in processing. The average crop yield per hectare of the crop has risen from 2.5 metric tonnes per hectare to an average of 4 and 5 metric tonnes of the same acreage, owing to the initiative. Currently, the United States Department of Agriculture (USDA) puts N i g e r i a’s m i l l e d r i c e 2018/2019 production at 4.78 million metric tons (MT), up over 2.5 percent from 2017/18 figure of 4.66 million MT. Rice import has reduced by 99 percent from about 1.2 million MT to about 784MT, industry estimates show.
Answer Industries donates egg powder, other relief materials to orphanages Josephine Okojie
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nswer Industries Limited, Nigeria’s sole egg powder manufacturer has donated some of its products, noodles, tissue papers, and other essential household items to children with special needs and orphanages. According to the organisation, the donation was made in a bid to alleviate the sufferings of the physically challenged and socially displaced people in Ogun State amid the coronavirus lockdown. Samuel Sewoniku, o p e rat i o n s ma na g e r o f Answer Industries Limited in Ijebu-Ode, said the novel coronavirus pandemic and subsequent lockdowns of cities and states across the country have brought untold hardship to resource-poor Nigerians, hence, there is the need to reach out to as many people as possible. Sewoniku urged wellmeaning Nigerians and other agro-allied industries to, as a
matter of urgency, assist the under-privileged Nigerians to avoid starvation, lawlessness and resort to crimes as the social investment interventions of the various governments cannot adequately go round. He explained that the egg powder is nutritious, multipurpose and suitable for humanitarian reliefs in internally displaced camps, with a shelf life of over one year.
Egg powder, he added, could be used in virtually all foods, and wholesomeness is not compromised even without cold chain storage, unlike raw eggs. He urged the government at all levels to encourage production and consumption of locally made egg powder to create a value chain ecosystem that is capable of revolutionising egg production in the country.
L-R: David Etuk, production manager; Samuel Sewonike, director of operations, both of Answers Industries Limited and R. A Olaniyan, headteacher, School for Children with Special Needs, SAGAMU, Ogun State, during the donation made by Answer Industries to the school recently in Sagamu, Ogun State. www.businessday.ng
Industrialisation of raw eggs, he added, would avoid wastage and cycles of glut often experienced by egg-producing farmers, he says. Other items included in the donations were bottles of hand sanitiser, noodles, and toiletries. While receiving the materials at the School for Children with Special Needs, R.A. Olaniyan, headteacher, said, “I hereby, on behalf of parents, staff, and learners of the school, appreciate your love and generous donations to our learners.” She said the management of school would make judicious use of the materials for the wellbeing of the children, urging other well-to-do Nigerians to lend a helping hand to the children as well. Also, Bashiru Mudashiru, supervisor, SOS Children’s Village, who received the materials on behalf of the children, commended the company for reaching out in trying times like this, saying it was a demonstration of corporate social responsibility and wilful generosity.
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COVID-19: Enugu unveils coal-city rice, distributes as palliative Regis Anukwuoji, Enugu
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nugu state governor Ifeanyi Ugwuanyi is set to distribute the state-owned rice – ‘coal-city rice’ to some specified categories of beneficiaries as a palliative to cushion the effect of COVID-19 in the state. The governor who was represented at the occasion of unveiling the state homegrown coal-city rice brand by Simon Ortuanya, the secretary to the government said the distribution would commence next week. “This will be distributed to the people of the state as a palliative for the hardship @Businessdayng
posed by the effect of the coronavirus pandemic,” he said. Ortuanya noted the rice brand was part of the government’s response for a successful fight against the COVID-19 and a step further in the quest for the state economic diversification. The coal-city brand rice is planted, processed and packaged in Enugu state and it is a long-grain variety that is stone-free with standardised production. Also present at the function is Matthew Idu, the state commissioner for Agriculture, and special adviser to the governor on Agriculture.
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Life after COVID-19: A note of solidarity to the microfinance industry (1) Small Business handbook
Emeka Osuji
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his is a solidarity note to my friends in the microfinance industry and, by extension, to the informal sector in general, knowing how intertwined the industry is with the sector. We are currently suffering from two key ailments; one being an outcome of the other, and both of which are making it difficult for us to sleep well. The first one is the respiratory illness caused by the pandemic called COVID-19 – some demonic member of a large family of viruses, not new to the world, but has mutated to something terrible and jumped out from its domain in Wuhan, China in September, 2019. Our hearts have been broken to many pieces, as we watch various networks, reel out the casualty figures. We have also been inundated with prescriptions for the cure of the disease, even as scientists have placed a disclaimer on the efficacy of any such prescriptions that claim to cure COVID-19. They insist the cure is yet to be found but acknowledge that there are drugs that can help us build up our immunity, which is the actual thing that kills viruses. The share volume of reading matter on the disease is mindboggling and that leads me to the second ailment we currently suffer – information overload. Owing to the unresolved origin of the COVID-19 virus, even as many accuse the 5G – the fifth generation of
wireless communications technologies supporting cellular data networks - as the cause, a lot of controversy and conspiracy theories have been pushed forward compounding our case. I hasten to restate that the jury is still out on the most important issues concerning the virus – its causes and cure! Now you are beginning to see why I called it a demonic attack. Well, in Nigeria, anything we don’t understand is demonic attack. The only difference between this and others is that this is probably the only demonic attack that has dared our prayer warriors. You will agree that both the shepherd and the sheep are now on the run. However, it is not that the shepherd is not strong enough to protect the flock. Rather it is because the wise stoops to conquer. This is why your pastor has retreated and advised you to stay at home. All true believers must take the advice and, as the Holy book says “be still and see that the salvation of your God”. I would prefer to cut back on reading the materials being thrown out by the social media, especially as most of them are the opinions of contestants on the causes and cures of the pandemic. I believe this is the position of many already bugged down by these controversies. I will therefore avoid telling any story on COVID 19, beyond asking everyone to abide by the rules made by the political authorities regarding ways of ending the transmission of the virus. This is not the time to follow some primitive superstition about the invincibility of your ancestors and clan warriors. Besides, you have seen what is happening to the “Whiteman” whom your ancestors said were Spirits (or Demons) who could solve every problem. An Igbo proverb says: when the bare hands break bars of iron, the nearby trees wish they could flee”. COVID-19 will attack anyone who makes themselves
available, notwithstanding the holy books in their hands, talk less of the charms in their pockets. I would therefore like to emphasise the fact that the world will not end with COVID-19. Far from it. In fact, a better world is in the offing. It came like the night, but dark as it may be, day will follow the night without fail. My interest is how those in the microfinance industry should conduct ourselves, and businesses, so as to protect their lives, business and market positions, while the night lasts. The first tip is for us to stay at home; wash our hands; wear our masks and report any suspicious symptoms we may experience. I recognise the difficulties that may visiting our people whose economy is domiciled between their hands and mouth – hand-to-mouth economy. They have already run out of food. We see people getting aggressive and trying to force themselves on fellow hapless Nigerians and rob them of food items. That is as demonic as COVID-19. The first thing to acquire if one is to survive this pandemic is patience. We should be determined to survive. If we can riot over food in just over two weeks, what shall we do if Cameroun attacks us and a war breaks out as it did in 1967. We should not give the impression that all the fasting we claimed to be doing during special religious events is fake. How can people who fast for 40 days and nights riot over food in 14 days? However, government is not being absolved of its duty to provide general palliative that reaches all Nigerians and not just a few sections. Wise governments know that this is not the time to lie about use of public resources. Second, microfinance banks must reach out to their clients, the MSMEs, who have learned to depend on them, and in some cases are indebted to them. A lender takes interest in the
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I would therefore like to emphasise the fact that the world will not end with COVID-19. Far from it. In fact, a better world is in the offing. It came like the night, but dark as it may be, day will follow the night without fail
Dr Osuji is head of the department of Economics at Pan Atlantic University Lagos. eosuji@ pau.edu.ng @Emekaosujii
The happy people
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oris Johnson, the British Prime Minister, was diagnosed to have contracted the dreaded COVID-19 disease recently, and was subsequently taken not to see an obscenely expensive private doctor in Harley Street but to a government funded, National Health Scheme (NHS) hospital, just like any other British subject. Neither was he ushered into a VIP room at the hospital once he recovered enough to be discharged from the Intensive Care Unit. Information from all available news sources tell us he was moved to one of the general wards. There are several lessons one can learn from the whole Boris Johnson COVID-19 saga. First, is that the whole country was informed of the nature of his ailment from the get go and since then, the government apparatus has deemed it fit, to give the nation daily briefings regarding the state of his health. No unnecessary shrouding of anything in secrecy, since once he assumed public office, he automatically became public property. How can the public, who pay his salary and his subsequent medical bill, through the payment of their taxes, be kept in the dark about his medical condition? That just wouldn’t make any sense, and the robust democratic institutions operating in that system certainly wouldn’t permit it either. Juxtapose that to what transpired with our President who was at a point, out of the country on medical leave, for about three months. Till date, the only thing we have is a story about an ear problem. Second lesson is from a comment Pastor E. A. Adeboye once made, while making reference to the scriptures, when he said that only a fool would listen to someone who doesn’t practice
what he or she preaches. And let me assure you of something, Nigerians are not fools. Last and certainly not least, is the simple fact that one cannot be motivated to correct a reality that one doesn’t face. How can we expect any of our nation’s institutions to function well when government officials don’t even use them? All three of these lessons point to factors which often determine whether a system will work or not. That’s why, with apologies to no one, I doff my hat to the Governor of Kaduna State, Nasir El Rufai, who walked his talk by enrolling his son at a public school. Some like to call this gesture a mere gimmick but I beg to disagree. In my opinion, to toy with his son’s future, if he doesn’t have sufficient faith in the quality of education his son would receive, would be too expensive a gimmick. I believe, the Governor by this singular act, demonstrates his desire to toe the path of good leadership, seldom seen in these parts of the world, by abiding by Paul Wellstone’s guiding principle to, “Never separate the life you live from the words you speak”. Good on him. We will as a people do well to learn to make the connection between choices and consequences. Because we’re responsible for the choices we make, we cannot deny responsibility for their consequences also. A leader who refuses to hold himself to the same standards he holds others, is preparing the grounds for chaos and excellence can never be found there. It’s worthy to note that such conduct is not only reprehensible but it also breaches most rules on good moral conduct. The irrefutable fact that Kaduna State is one of the best governed states in the country did not happen arbitrar-
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ily, it’s the result of making the right choices. Until our thinking changes, we will be living in a fool’s paradise to believe our results will magically change. The world over, good leaders have always recorded enduring success by inspiring their people to change. The operative word here is “inspire”. Of course, it would betray an embarrassing level of ignorance on my part, should I ascribe all the credit to Boris Johnson, for doing the right thing though. Leading a nation where democratic ideals such as equity and justice are part and parcel of their social fabric, and strong institutions hold sway over strong men, such decisions had long been taken away from any of their leader’s hands. As Edmund Burke once said, “Society is indeed a contract...it becomes a partnership not only between those who are living, but between those who are living, those who are dead, and those who are to be born.” So, for those who still wonder if we owe future generations any duty, there’s your answer right there. What we do now will not only determine our future but theirs too. The UK has some flagship institutions/policies which represent their values and ideology as a people. Their liberal welfarism sprouts from a belief that all citizens, no matter their economic status, are entitled to enjoy at the very least, the most basic provisions for a meaningful life; some of such institutions is the NHS, established after the Second World War, to cater for all British citizens, no matter their colour or religious belief. Free housing, free schooling and the job seeker’s allowance, popularly known as the “dole” are others. Though he utterly despised the notion of welfarism and hardly forgo
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welfare of his debtors for many reasons, including humanitarian and commercial/economic. A creditor has the enlightened self-interest to help the borrow to stay alive, so as to improve the chances of repayment. In the annals of financing, only the usurious moneylender tends to want the borrower dead, so as to convert the underlying assets. Other reasons to protect the clients include the need to stay in their subconscious, even in these bad times so they don’t forget you when the day breaks, as it surely does. Three, be wise like the pastors; use and show clients available alternative channels of transacting. Digitisation may have cost you some business in the past. This is payback time for you. The pastors have given their followers all the online information needed to keep the offering coming. They are not commercially oriented. Why not you? One of the misconceptions about the poor, which microfinance came to correct, is that the poor have no money and therefore have nothing to save. Common be smart! You disproved this fallacy in Microfinance 101 class. The clients may still need savings opportunity, even in the lock down. Give them the help to do so. Fourth, for long, I have been telling you that cost minimisation is the fair side of revenue maximisation. Most people, not just you, find this simple concept hard to understand. Even our national and subnational governments find it so hard to understand. This is why they keep looking for more taxes from failed economic agents, and run yoyo with oil prices. If your income falls or if you can’t make money at all, look at your expenses. Cut them.
Character Matters with Daps
Dapo Akande
any opportunity to criticize it, Lee Kuan Yew, the indefatigable father of modern Singapore, nevertheless remarked in his usual didactic manner that, “The key to peace and harmony in society is a sense of fair play, that everyone has a share in the fruits of our progress”. I think it would be fitting for me to end with a quote by Ernest Fitzgerald which says, “It is not by accident that the happiest people are those who make a conscious effort to live useful lives. Their happiness, of course, is not a shallow exhilaration where life is one continuous intoxicating party. Rather, their happiness is a deep sense of inner peace that comes when they believe their lives have meaning and that they are making a difference for good in the world.” Changing the nation...one mind at a time. Akande is a Surrey University graduate with a Masters in Professional Ethics. An alumnus of the institute for National Transformation and author of two books; The Last Flight and Shifting Anchors. Contact: dapsakande25@ gmail.com
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Wednesday 15 April 2020
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How International Financial Reporting Standards (IFRS) benefits SMEs
Timi Olubiyi
I
n the context of this article, Small and Medium-sized Enterprises (SMEs) are referred to entities that may not have public accountability and with their debt or equity instruments not traded in a public market. Various studies conducted by academia, professional and governmental agencies confirm the fact that SMEs are the engine of economic growth and development. However, they are mostly unstructured and as a result of globalisation, SMEs are enjoined to adopt the use of International Financial Reporting Standards (IFRS) in presenting their financial statement which is single reporting standard that cuts across borders. International Financial Reporting Standard (IFRS) refers to a set of accounting standards developed by the International Accounting Standards Board (IASB) to be applied when preparing the financial statement and
balance sheet of a company. IFRS was developed in 2001 by the IASB in the public interest to provide a single set of high quality, understandable and uniform accounting standards. Even though there are many accounting standards in the world, nevertheless to improve adequate financial communication in a meaningful and trustworthy manner the international financial reporting standard is the acceptable way of harmonising accounting practices, and global financial reporting. One significant contribution of the adoption of IFRS to SME is in the improvement of quality financial reporting of the businesses and also help SMEs in international business engagements and financial dealings. Opinion survey amongst selected entrepreneurs and SME operators in Lagos State which is the SME hub in the country indicated that the majority of the SMEs do not have records of financial statements or keep records of financial position of their businesses. Over 70 percent of the SME operators in the survey, who are merely family businesses at different locations in Lagos State argued that much of the disclosures and information required by full financial statements are not relevant to their micro, small and medium businesses. Some professionals amongst the respondent similarly argued that SMEs do not have “public accountability” hence they do not need to disclose as much information as the listed companies do. Almost all the respondents established that the need for IFRS compliance financial statements is the responsibility of big organisations and multinationals.
However, the simple truth is that the adoption of IFRS for SMEs will help in enhancing the quality and comparability of SMEs’ financial statements around the world and can help SMEs to reach international markets easily. It can also assist SMEs in gaining access to finance which will not benefit only the SMEs, but also their customers, clients, stakeholders and all other users of SMEs’ financial statements. This will on the long run bring about growth in the business operations of these SMEs. More importantly, adopting IFRS will have a positive effect on the credit rating scores of enterprises, this will equally strengthen SMEs’ relationships with credit institutions. While I agree that the inherent problems of SMEs such as poor governance, lack of transparency and accountability, incomplete bookkeeping and records, administrative bottleneck, have prevented most SMEs in Nigeria from benefiting from the advantages of adopting IFRS compliance financial records, it is crucial to be on the path of business growth. Investors and creditors often use information about the past in assessing the prospects of businesses. If the quality of financial reporting is poor, it will be difficult to determine correctly the net profit of the business. In the absence of financial reporting, SMEs cannot ascertain whether they are making a profit or loss. If businesses are properly set up and managed and they can easily grow, attract funding and become a large firm and provide much-needed employment and contribution to economic development. Remember that most companies essentially start small as SMEs with less
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The adoption of IFRS by SMEs is hereby encouraged because it will boost the comparison of financial statements within the industry, and across sectors. It will even open doors of international engagements because the financials will conform with international standard available globally
than 200 employees. There is no doubt that the adoption of IFRS would facilitate good decision-making, thereby leading to better transparency, accountability, and compliance with constituted authorities and for access to funding. Adoption of IFRS will improve the quality of financial reporting of the organisation and add global acceptable look to company reporting culture. Consequently, the adoption of IFRS by SMEs is hereby encouraged because it will boost the comparison of financial statements within the industry, and across sectors. It will even open doors of international engagements because the financials will conform with international standard available globally. It is hereby suggested that SME operators should see the adoption of IFRS as a top priority in view of the many benefits that are attached to the adoption. In addition, the new Finance Bill exempts small businesses with an annual turnover of less than N25 million from Company Income Tax (CIT). This can be harnessed by SME operators and entrepreneurs with accounts in line with the provision of IFRS. It is, therefore, reasonable to hire a specialist to achieve or streamline this very important aspect of business structure, if it is currently missing in your organisation. Good luck! Dr. Timi holds a Ph.D. in Entrepreneurship and Small Business Management. He is a prolific investment coach, Chartered Member of the Chartered Institute for Securities & Investment (CISI) and a financial literacy specialist. He can also be reached on the twitter handle @drtimiolubiyi and via email: drtimiolubiyi@gmail.com.
From the blogs
The next wave of virus will be in Africa and it could potentially be devastating
T
he biggest conspiracy against the growth and dominance of Africa and Africans is not the work of Bill Gates, Monsanto, 5G, the Coronavirus or imperialists or colonialists. It is not Donald Trump. It is not China, it is not Boris Johnson or Queen Elizabeth. It is not a right wing conspiracy, or a left wing conspiracy, neither is it a grand plan of Israel or even the Middle East. Africa’s biggest problem is its leadership. No world leader, or richest man in the world will suffer through vaccines or killing many of his own people or use electromagnetic waves to kill us. And let me tell you why: In 2018 alone, about 230,000 brand new Toyota Land Cruiser 80 (2018 models) were sold in Africa. Let’s assume that the private sector and NGOs bought 50 percent of those (a very conservative estimate), then it means the other half were bought by African governments. This means that at a very very generous base price of $60,000, $690 million was spent on sub-saharan Africa alone for governmental bodies and officials to buy Toyota Land Cruisers. (Sales Data Source: Toyota Global Website) The World Health Organization (WHO) global health expenditure database puts general government expenditure for health for Sub-Saharan Africa at $361.777 million for 2017. If we even made the figure $362 Million, it means that we spent on average 52 percent of what we were willing to spend on Land Cruisers rather than on the health of our own citizens. This is just the cost of
acquisition, not maintenance. In 2016, Africa accounted for 1.1 percent ($22.3 billion) of global investments in Research & Development (R&D). Globally, pharmaceutical companies are among the top investors in R&D in the health science sector, but this is not the case in Africa. Africa has 15 percent of the world’s population and 25 percent of the world’s disease burden, but only 1 percent of the world’s research and development budget is spent in the whole of Africa. Even that, it comes from external resources. Africa, a content of about 1 billion people, holds only 0.1 percent of the world’s patents. Only 198 researchers per million people. Yet even then, remember that our R&D expenditure is mostly sourced from abroad. If you think I’m lying, the 2 main centers for Corona testing are funded by Germany and Japan! Illicit financial losses from corruption and embezzlement alone amount to some $50 billion annually. Guess where it goes? The WEST! When you are flying abroad, who usually sits in business class and sleeps and wines and dines in the finest hotels in Europe and America? Is it the African immigrant hustler or the politician and his cronies? Who do you see when you go to the Palms in Dubai or Abu Dhabi? Or in Monaco or on the Champs D’Elysees? How many politicians don’t own $1 million houses in various estates sprinkled across different continents? In such a situation, do you think that all
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someone cares about is to try and destroy us with a virus? We have already systematically weakened our systems. We have very little industrial capacity, we have sold whatever is remaining in Africa to Chinese, we only contribute to 2 percent of the world’s manufacturing. Our leaders pride themselves in dashing us bicycles, t-shirts and bags of imported rice. Do you think anyone worth their time needs to employ sophisticated methods which will endanger their own people to destroy us when we are doing such a nice job of it ourselves? For every day that we live, our compromised healthcare systems and the egos of our leaders are going to sink us further. We have no capacity to produce anything that will help us. We don’t even have the research labs to provide us with research against the virus. Yet we have an 89 percent (Ghana) and over 80 percent (Christian SSA countries) where “men of God” are opinion leaders spewing all sorts of controversies because we have been wired to believe in miracles more than science. Sub-saharan Africa contributes on average only 0.05 percent of the world’s mathematics PhD holders. Wanna juxtapose that with PhD holders in say Theology? Be my guest! Hey wait, Ghana still plans to source from churches $100 million to build a cathedral with a Bible Museum, hoping that it will be a tourist attraction. But nobody remembers the last time it bothered to refurbish its museum of science and technology, which has at its entrance a steam tractor from the early 20th
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Selorm Branttie century and an old Gatlin Gun. We keep crying about drug testing on poor Africans, but how many virologists do we have, and how many virus institutes do we have to deal with the over 25 percent disease burden that we have? Or have our spiritual leaders in the shrines, mosques and churches suddenly become disease spread experts? What is the ratio of doctors to a patient, or nurses to a patient, or medical labs to patients in Sub-Saharan Africa? At this stage, we don’t need Bill Gates to wipe us off the earth. We are doing so alone with our incompetence. We have not even begun fingering the Chinese who are forcing governments to mortgage their mines and in Ghana our Rivers for alluvial gold and bauxite reserves for roads that will last all of 10 years. If you think Coronavirus, digital medical records, vaccine trials and 5G Networks are designed to destroy Africans for the monopoly of some old computer scientist living in Oregon or Washington State in the US to benefit, then you probably should save us all and succumb to the virus as you don’t belong in the 21st century anyway. I know it’s harsh, but that’s the truth. There is no conspiracy against us. We are the captains of our own fate. Branttie is of IMANI, Accra
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Wednesday 15 April 2020
BUSINESS DAY
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COVID-19 spread: Time for responsible leadership and shared responsibility
Franklin Ngwu
D
isturbed by the increasing spread of COVID-19 in Nigeria and across the world, I cautioned last week that it might be pertinent to impose a national lockdown as one of the measures to curtail the virus. Not only was the caution not heeded, some governors further relaxed the floppy restrictions they had in their states with the excuse to allow people to celebrate Easter! What an interesting excuse! How did we end up with the kind of leaders particularly governors we have in Nigeria, a friend lamented! In reviewing the level of compliance to the restrictions in our different states, one can only describe it as flawed and unserious not only in compliance but also in announcements, awareness, enforcement and leadership. This clearly demonstrates that even with the most disturbing mortalities across the world, we are (particularly our governors) are still attending to the crisis with a chequered attention. It is pathetic and shocking, a frustrated elderly friend sorrowfully stated. Are you sure that some of them (the governors) are not intentionally creating the opportunity to have COVID-19 cases in their states to partake in the sharing of the largesse
being distributed, another friend grievingly muted! Of the 36 states and FCT, it seems that Babajide Sanwo-Olu and Dave Umahi are the only governors that really understands the seriousness of the pandemic and the need to curtail it. While many of our governors are unserious and unprepared, others seem to be playing politics with the deadly crisis. Lamentably, as they continue to treat the COVID-19 pandemic with the same levity to which they have treated governance issues in their states and Nigeria, the virus is exponentially spreading. To be specific, the spread of the virus in Nigeria and most recently to Katsina, Kano and Anambra can be clearly attributed to our lousy approach to governance. Another good example is Osun state with about 20 cases as at Monday 13th April 2020. In Lagos even with the Presidential affirmation of lockdown, the security guard of a friend travelled to Kebbi state via Ibadan last week to get married to his third wife! With an index case in Lagos in just about a month ago, we now have about 323 confirmed cases in Nigeria spread across 19 states and FCT. As the spread to other states outside Lagos and Abuja could have been prevented or significantly reduced if we acted proactively through a national lockdown and other strategies, it is important that our leaders particularly the governors show leadership to prevent or curtail further spread to other states. This is most important if we appreciate that all the confirmed cases in 17 states can be traced to people that passed through Lagos or Abuja. Moreover, this call and need to show responsible leadership and shared responsibility cannot be more important
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Moreover, this call and need to show responsible leadership and shared responsibility cannot be more important than now given our weak health sector that is manifesting with very slow rate of testing as compared to other African countries
than now given our weak health sector that is manifesting with very slow rate of testing as compared to other African countries. While Nigeria has tested only about 5,000 cases in a country of 200 million people, South Africa with about 60 million people has done about 75, 000 tests. This is also the case with Ghana of about 31 million people that has carried out about 37,400 tests and Egypt of about 102 million people with about 25,000 tests. Given our population, size and the time that the virus first emerged in China and signalled a potential outbreak, are we not supposed to have at least one test centre and a properly equipped isolation centre in every state of Nigeria? With the emerging wide negative socio-economic and health impacts of COVID-19 on Nigeria, am not sure there is a better time to exhibit responsible leadership and shared responsibility than now. Nigerians expect more than we are getting from our governors in terms of proactiveness, collaboration, strategic thinking and coordinated leadership. Of the 36 governors, the coordinated leadership task rests more with His Excellency Kayode Fayemi of Ekiti state. As the Chairman of the Nigeria Governors Forum, this is the time to exhibit unquestionable leadership and coordination of other governors. While it is commendable but now fruitless to help in reconciling Governor Ganduje and Lamido Sanusi, a more commendable task will be to ensure that our governors understand the seriousness of the socio-economic and health crisis and act accordingly. A situation where the governors seem to be working at cross-purposes and clearly against our national interests is sad and condemnable. If some
Why regionalism/restructuring Nigeria is vital
R
egionalism has come back to prominence, as the political, economic, cultural and social meaning of space is changing in contemporary Europe. In some ways, politics, economics and public policies are de-territorialising; but at the same time and in other ways, there is re-territorialisation of economic, political and government activity. The “new regionalism” is the product of this decomposition and recomposition of the territorial framework of public life, consequent on changes in the states, the market and the international context. Functional needs, institutional restructuring and political mobilisation all play a role. Regionalism must now be placed in the context of the international market and the European Union, as well as the nation-state. Since the inception of the President Muhammadu Buhari-led administration, there have been calls for restructuring. This current system being practiced in Nigeria has failed the whole country. The whole country is on fire. What is the way out? Regionalism or restructuring is the answer. It has worked for us before but the only defect is that it promoted ethnic loyalty but on the contrary, regionalism brought development into the country. The three regions were highly competitive and this brought about rapid development. The West till today enjoys the legacy regionalism gave the country. Majority of the residents of the West are highly educated which has and is still bringing unprecedented growth. The flairs of the type of regionalism practiced during the 1st republic should be worked on and Nigeria should be given an upgraded version. This current system of governance in practice only makes the politicians lazy. Most of the states are in financial trouble because of the failure of past and successive governments
to prepare for the worst. With an improved regional system, the problem of laziness would be curbed to a large extent. It was under regionalism that Nigeria was a pride to Africa. Do not also forget that when Nigeria was practicing regionalism, there was no oil yet discovered. Now that we are in a world whereby oil is falling; regionalism is the answer to Nigeria’s wake up call. More so, restructuring is a song also on the lips of many Nigerians. It has trended for decades and seems to be an inter-generational topical issue in Nigeria. The persistent call for restructuring takes numerous dimensions, but particularly outstanding is in the dimension of politics. It is no surprise though, because the philosophy behind the existence of every state and the control of its resources bothers on politics. Therefore, when there is a damaged cog in the wheel of the politics of the state, it becomes imperative to politically restructure the state. Nigeria as a sovereign state is one that has numerous ethno-tribal groups as matched with its vast territory, large population and enormous land mass. Each of the locales within the Nigerian territory is endowed with either one mineral, vegetative or other natural resources and/or a correspondence of resident human resources (population). In view of this, any knowledgeable administrative analyst would suggest the adoption of the federalist political structure, so as to ensure efficient administration of both the vast territories of Nigeria and its ethno-tribal heterogeneous population. This is what has been administratively put in place as a political mechanism for governance within the Nigerian polity. The current Nigerian political structure which has its roots in the 1946 Sir, Arthur Richard’s constitution of Nigeria, right from its inception till now has
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shown symptoms of administratively sick system of government resulting from such issues as the issue of resources control, outcry of marginalisation, issue of ethno-tribal and regional discrimination, and issue of ensuring that every citizen irrespective of age, sex, religion, ethnic, linguistic, regional or tribal affiliation is given a sense of belonging to the country. Nigeria is Africa’s biggest economy and the most populous black nation on earth. Yet, regional economic inequality and the lopsidedness of Nigeria’s political system have led to a series of protracted conflicts. The country is currently embroiled in crises similar to the tumultuous time after independence in 1960, when regional and ethnic tensions erupted in a vicious power struggle. Back then, following a coup against the northern-led government in January 1966, thousands of Igbos living in the northern region were forced to flee to their homeland following the outbreak ethnic clashes. In 1967, Odumegwu Ojukwu, an Igbo military officer, proclaimed the independence of Republic of Biafra, leading to Nigeria’s first bloody civil war, which ended in 1970. Over forty years later, desires for a breakaway still linger. Both the Movement for the Actualisation of the Sovereign State of Biafra (MASSOB) and the Indigenous People of Biafra (IPOB) aim to restore the state of Biafra and challenge Nigeria’s current political structure. Despite being a federal republic, Nigeria has a unitary constitutional arrangement in which the federal government wields overarching powers. Like the United States of America, Nigeria is structured as a federation with 36 states, one federal territory, and 774 Local Government Areas (LGAs), including Abuja. However, unlike the United States, the central government controls the revenues and nearly
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governors are not relaxing their ineffective restrictions, others seem to be doubting the existence of COVID19 in Nigeria from their actions and inactions. While it is good for the Presidential COVID 19 team to chat with His Excellency Kayode Fayemi from time to time, it is not enough. Nigerians need to see the effectiveness of such discussions in the proactive actions and inactions of our governors. For instance, the chairman of the Nigeria Governors Forum or his deputy should be a member of the Presidential COVID 19 Team. The suggestion and coordination of a national lockdown should be championed in collaboration with the federal government by the Nigerian Governors Forum to make it more effective. Outside asking for waivers and palliatives from Federal Government, the Nigeria Governors Forum should come out with their own policy paper on how the states either regionally or individually will mitigate the socio-economic impacts of the crisis. Expectedly, the mitigation policies should contain details of collaboration with the federal government on one side and with the private sector on the other side. As we have about 17 states that have not recorded a confirmed index case yet, the question is how the governors of the respective states will collaborate with states with confirmed cases to prevent further spread. This will require proactive responsible leadership and patriotic shared responsibility. Dr. Ngwu is a Senior Lecturer in Strategy, Finance and Risk Management, Lagos Business School and a Member, Expert Network, World Economic Forum. E-mail- fngwu@lbs.edu.ng
Ademola Orunbon all of the country’s resources, especially oil and natural gas. Revenues accrue in the Federation Account, where it is allocated monthly to the states and the LGAs, by a federal executive body, the Revenue Mobilisation, Allocation, and Fiscal Commission (RMAFC). The political structure has not always been this way. Prior to the creation of the present-day state of affairs in 1967, Nigeria had four regions under the 1963 constitution, namely Northern Nigeria, Eastern Nigeria, Western Nigeria and Mid-Western Nigeria. Without federal government allocation or revenue from oil, export crops were central to shaping the economy of the four regions, and served as the country’s main source of foreign currency. Political federalism reduced the power of the central government. Thus, national debate and calls for restructuring are nothing new, but they continue to grow amid economic stress, political uncertainty and recurrent violent conflicts across the country. Especially, ahead of the February 2019 elections, the push for restructuring of Nigeria’s political system is gaining momentum. Groups from the south, which have long championed the call for restructuring in defence of regional economic development, are particularly vocal in their demands for upending the current centralisation of political power. Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng Orunbon, a journalist and public affairs analyst, wrote from Federal Housing Estate, Olomore, Abeokuta, Ogun State. He can be reached via: orunbonibrahimademola@gmail. com or 08034493944 and 08029301122
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BUSINESS DAY
Wednesday 15 April 2020
Editorial Publisher/Editor-in-chief
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Frank Aigbogun
Prioritise the security of citizens amid the lockdown
editor Patrick Atuanya
If ignored, we only risk further bloody retaliation from community members
DEPUTY EDITORS John Osadolor, Abuja Tayo Fagbule NEWS EDITOR Chuks Oluigbo MANAGING DIRECTOR Dr. Ogho Okiti EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso BUSINESS DEVELOPMENT MANAGER (South East, South South) Patrick Ijegbai COPY SALES MANAGER Florence Kadiri DIGITAL SALES MANAGER Linda Ochugbua GM, BUSINESS DEVELOPMENT (North)
Bashir Ibrahim Hassan
L
agos state is currently home to one of the ripple effects of the lockdown decree imposed by the federal government in a bid to contain the spread of COVID-19. Insecurity has increased and become a significant concern for residents. News of robbery attacks, raping, house burgling and other unfortunate incidents caused by miscreants create a new headache the Federal and state government must address. On Saturday, hoodlums in large numbers said to have emerged from the Agbado area to Abule Egba in Lagos, wreaked havoc by breaking into shops and houses to loot various items and rob residents of money and valuables. Residents of the affected neighbourhoods in Ogun State like Ijoko, Sango Ota, Ayepe, Ilepa, Ibogun, Itori and Agbado now live in fear, while those in Ajao Estate, Abule Egba, Iju, Agege, Alimosho, Alagbado, reckon that they no longer sleep
well at night because of the threat posed by the hoodlums. On Easter Monday, it extended to the Lekki axis with hoodlums trying to scale the wall into Nicon Town off the Lekki-Epe Expressway. The situation became so bad that residents of the affected communities formed vigilante groups to protect themselves against the miscreants. It is easy to locate the breakdown in the effects of the lockdown on citizens who live out of the earnings from their daily hustle. Three weeks into the shutdown in Lagos, most have used up whatever reserves they had. The possibility of an extension worsens the threat. We implore the federal and Lagos state governments to take necessary steps to prevent an escalation of hoodlums’ activities in the land. They must deploy the stick but also find necessary carrots to remove the basis for such criminality. The IG of Police on Monday named the DIG in charge of the Southwest as the Coordinator of a team to tackle the banditry in Lagos and Ogun States. DIG Peter Ba-
batunde Ogunyanwo will oversee the deployment of the intelligence and operational assets of the Police Force comprising the Police Mobile Force, Federal Special Anti-Robbery Squad (FSARS), Intelligence Response Team (IRT) and the Special Tactical Squad. The Police said they had arrested 191 suspects already. We commend the response of the IG against the backdrop of waffling by the commissioners of police in the areas earlier. While the government seeks to protect its citizens from contracting the COVID-19 virus, we also need to be assured protection from hoodlums or the whole lockdown exercise will be in vain. While we recognise necessary steps taken to ameliorate the effect of the pandemic on Nigeria’s healthcare system and economic performance, however, a threat to security in the country is a threat to economic growth and development, rendering futile any economic stimulus. Heightened insecurity hinders capital inflows, distorts peace and order, and throws more people into misery. The federal
government in its list of economic priorities in a time like this will be making a big mistake if security isn’t prioritised. Youths have begun taking the law into their hands as they sharpen their machetes ready to behead whosoever threatens the peace of their communities. Youths are ready to have blood on their hands than to be robbed by hoodlums. This signifies without any doubt the failed security system Nigeria currently operates. We risk having this as the order of the day despite being an abnormality. These unrests provide the federal government with an opportunity to tackle Nigeria’s insecurity challenges which largely is caused by the high unemployment rate and difficult living condition in the country. Nigeria must tread the rough road of hard decisions to ensure the security of lives and limbs as a priority. Insecure citizens would be difficult to rein in or organise to observe any social control measures such as the lockdown to contain the spread of coronavirus.
GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu HEAD, HUMAN RESOURCES Adeola Obisesan
EDITORIAL ADVISORY BOARD Imo Itsueli Mohammed Hayatudeen Afolabi Oladele Vincent Maduka Opeyemi Agbaje Amina Oyagbola Bolanle Onagoruwa Fola Laoye Chuka Mordi Mezuo Nwuneli Charles Anudu Tunji Adegbesan Eyo Ekpo Wiebe Boer Paul Arinze Boye Olusanya Ayo Gbeleyi Haruna Jalo-Waziri Clement Isong
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14
Wednesday 15 April 2020
BUSINESS DAY
COMPANIES & MARKETS
COMPANY NEWS ANALYSIS INSIGHT
MARKETS
Nigerian stocks jump by most in over-a-month as OPEC & allies announce big production cut SEGUN ADAMS
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tocks on the Nigerian Stock Exchange (NSE) gained by the most since early March after OPEC and its allies agreed to an unprecedented oil production cut to prop up oil price. The benchmark All Share Index gained 1.47 percent, compared to 1.7 percent on March 3, to extend bull-run to three days, the longest seen since the first trading week of the previous month. Gains in big tier banks including big cap stocks like Nestle by 8.52 percent to N830.2 and Seplat by 1 percent to N495 helped pare year’s loss for the broad market to 20.33 percent. However, Dangote Sugar was the day’s biggest gainer after unit price rose 9.74 percent to N10.7. UBA gained 9.73 percent to N6.2, , FBNH edged higher by 6.82 percent to N4.7, Zenith Bank by 5.66 percent to N14, while GTB and Access gained 3.01 percent to N18.85 and 2.31 percent to N6.65 respectively. OPEC+ on Sunday agreed to a record production cut of nearly 10 million barrels per day (mbpd), at least a tenth of global supply, to support oil price that has fallen around 50 percent since mid-February. The 9.7 mbpd cut which exceeds 2008’s record 2.2 mbpd cut will come into effect
in May and June. The collapse in oil price was initially driven by slowing demand for the fuel by economies due to the shutdown of activities caused by the COVID-19. But a failure of OPEC and allies to agree on a production cut crashed price further and threatened oilproducing economies. Specifically, Russia’s refusal to a proposed further cut on March 6 led to a price war between the OPEC ally and Saudi Arabia which saw oil dip below $30 levels at some point. According to Reuters, the recently agreed-upon global cuts will include contribu-
tions from non-members, steeper voluntary cuts by some OPEC+ members and strategic stocks purchases by the world’s largest consumers. The news agency citing relevant sources said the real effective cuts by OPEC+ would total 12.5 million bpd because Saudi Arabia, the United Arab Emirates and Kuwait would cut supplies steeper given higher output in April while some nonmembers would contribute 4 million to 5 million bpd. Nigeria would have to cut production by 23 percent of October Oil production of 1.83 mbpd which is the
equivalent of 414,000 bpd. The initial reaction of the market has been said to be weak due to low oil demand which has fallen by a third since the pandemic. At higher price levels, the pressure would ease on the naira which is said to be overvalued after CBN’s devaluation to N360/$. This would reduce currency volatility risk that has on one hand caused foreign capital flight, while grim economic forecast on the Nigerian economy could ease encouraging investors to pick stocks already trading at deep discounts to their intrinsic value.
CSR
Axxela Donates Life-saving Medical Supplies to Lagos State Government DIPO OLADEHINDE
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xxela Limited has made a multimillion naira donation of 5,000kg of medical oxygen to Lagos State Government, the epicentre of Nigeria’s fight against deadly coronavirus. Speaking on the initiative, Axxela’s CEO, Bolaji Osunsanya said “As an economic enabler, we have taken active steps to engage the government on pain points, and the seamless synergy between the private and public sector will help us overcome this crisis. As an essential services provider, Axxela has ensured that our business enterprise continues to function optimally to provide uninterrupted natural gas supply to critical businesses and infrastructure. Accordingly, we have prioritised natural gas supply to power plants that supply electricity to medical facilities, as well as industrial producers of fast-moving consumer goods critical to the well-being and sustenance of many during this period.” With 20 years of business operations in Nigeria and its expansion to West African region, Axxela has built a culture of safety and a reliable reputation of empowering industries and communities by delivering value-adding energy solu-
tions for socio-economic growth and empowerment. According to Axxela’s Community Relations and Security Manager, Aloiye Aigbonoga, the donation is part of Axxela’s holistic contributions to curtail the spread of the Coronavirus in Nigeria. He said, “As the world deals with a rapid infection rate, we have a responsibility to buckle down and collaborate effectively to fight against the raging pandemic. We applaud the leadership of our state and federal governments and the Nigeria Centre for Disease Control (NCDC), the selfless endeavours of all. Recall, President Muha m ma d u Bu ha r i a n nounced a sum of N10 billion grant to Lagos State, being the epicentre of the virus, while N5 billion was allocated to the National Centre for Disease Control (NCDC). While other corporate organisation such as Access Bank, Zenith Bank and Guaranty Trust Bank gave N1 billion each with facilities for isolation center. Other individuals who have donated N1billion each include Aliko Dangote, Tony Elumelu, Femi Otedola, Abdulsamad Rabiu, Herbert Wigwe, Segun Agbaje, Tim Ovie and Emmanuel Lazarus who gave N2 billion, while Atiku Abubakar gave N50 million and N10 million from Tuface Idibia.
ECONOMY
Nigeria’s economic recovery post-COVID-19, beyond ‘spending strategy’ DAVID IBIDAPO
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t is no longer a news flash that the novel coronavirus, COVID-19 has brought the global economy to its knees, threatening to pull into recession even economies with strong economic buffers, and into a depression, economies with weak or almost non-existent buffers just like in the case of Nigeria. While this may be an eventuality for Nigeria in a worst-case scenario without a stimulus, exiting a recessed or depressed state as the case may be, most likely will not follow the conventional “spending your way out” economic strategy like the 2016 case. This is because fiscal, monetary and market buffers are almost non-existent. This puts Nigeria in a dire state and must devise a new strategy for recovery.
“It is futile to seek comfort in strategies that guaranteed success in the past as history isn’t a good guide in a period like this,” Bongo Adi, member of academic faculty at Lagos Business School said at LCCI webinar which held on Thursday via Zoom themed “Managing the shocks and disruptions of COVID-19.” To contextualise, as at 2019, the CBN’s Ways and Means Advances to the FGN stood at N5.051 trillion, above the policy stipulated maximum of 5 percent of previous financial year’s actual revenue of N3.9 trillion. This makes further aggressive advances to the FG difficult without increasing inflationary and exchange rate pressure as it may mean the CBN printing more naira. Also, Nigeria’s dependence on the volatile crude oil market has thrown the country into
a deeper mess forcing it to readjust its budget to reflect current realities. The significant shortfall in its major revenue source – crude oil sales – which accounts for more than 70 percent of its earning, coupled with the compulsory “holiday” imposed to curb the spread of the deadly virus has exposed the biggest economy in Africa to two major crisis, economic and health crisis. Social and political crisis inclusive. The COVID-19 pandemic which has depressed global export and production, as seen governments across the world expend huge funds in a bid to respond to the crisis, hence, creating more liquidity glut in the global market space. However, sadly, Nigeria which could get a fair share from such glut hasn’t been and currently not well-positioned to attract such liquidity.
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Attracting such liquidity into the Nigerian economy may currently prove difficult given downgrades from stable outlook to negative by Standard & Poor (S&P), a well-respected international credit rating agency, due to its declining foreign exchange reserves amid oil price plunge. However, Nigeria may need to change her economic strategy which has revolved around revenue from crude oil sales and debt when there is a revenue shortfall to creating income from equity issuance of its assets. “In every companies’ balance sheet, there are assets and not limited alone to debts. As a country, we must broaden the focus beyond revenue and debt. Do we not have assets?” Ayo Teriba, CEO of Economic Associates, explained at a recently concluded LCCI webinar.
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According to him, the Nigerian federal government own stakes in companies, own lands and other assets which are wasting away that can be unlocked to attract private capital. Nigeria which has enjoyed a period of economic boom prior 2015 saw her move from 50th largest economy in the world to 27th largest in terms of nominal GDP. “During this period, it is assumed that Nigeria would have acquired a lot of assets which could be unlocked now,” he said. While Nigeria could afford to borrow more in the era of boom, it doesn’t have such luxury today given its weak earnings and debt servicing weighing heavily on its revenue. Hence, may need to consider unlocking its dead assets. Nigeria is currently in a dire state amid this pandemic. A state that is synonymous to the paradox of thrift theory. A vi@Businessdayng
cious cycle where households fear, panic and containment force down spending hence more savings, producers not producing hence suppliers out of work and ultimately decrease in gross output (GDP). With no business activities, the company try to cut down cost by laying off workers which in turn increase unemployment and lowers total savings. According to a presentation by Adi, potential losers in this pandemic are Oil & Gas, Education (except sector could leverage on technology), financial services, manufacturing, construction & real estate, Transportation, Aviation & Maritime, Tourism & Leisure sectors of the economy. However, Medical Supply & Service, ICT, Personal & Healthcare, Ecommerce, Agriculture, Food processing and Retail are potential winners.
Wednesday 15 April 2020
BUSINESS DAY
COMPANIES&MARKETS
Business Event
15
OIL& GAS
PTML, Grimaldi donate N150m, nose masks to support fight against Coronavirus AMAKA ANAGOR-EWUZIE
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orts and Terminal Multiservices Limited (PTML), Nigeria’s largest roll-on-rolloff (RORO) terminal and its parent company, Grimaldi Nigeria have collectively donated a total of N150 million, 10,000 nose masks and 5,000 hand gloves to Federal and Lagos State Governments in support of the fight against the spread of coronavirus (COVID-19) in Nigeria. While PTML donated N100 million to the Federal Government’s COVID-19 Relief Fund Account created by the Central Bank of Nigeria (CBN), Grimaldi Nigeria donated N50 million to the Lagos State Government. The terminal operator also donated 10,000 nose masks and 5,000 hand gloves to Nigerian Ports Authority (NPA) Tin-Can Island Port to support NPA’s effort to checking the spread of the virus at the nation’s seaport. Ascanio Russo, managing director of PTML, said the firm deems it necessary to identify
with the efforts of the Federal Government, Lagos State Government and Nigerian Ports Authority (NPA) in strengthening measures towards containing the spread of the global pandemic in Nigeria, and particularly the port industry. “In addition to these donations, we have at our company level, as part of our contribution to stem the scourge, implemented all the safety guidelines prescribed by the World Health Organization (WHO), the Nigeria Centre for Disease Control (NCDC), the NPA, the Nigerian Maritime Administration and Safety Agency (NIMASA), Port Health Services and others,” he said. According to him, the terminal has remained fully operational as directed by the Federal Government with regards to the continuity of port operations. “We have intensified the use of assigned personal protective gears including nose masks and hand gloves at all terminal work locations, while ensuring social distancing by crowd reduction at all our customer
service points and reduction in number of biometric access cards per agency,” Russo said. He also said that port users are being encouraged to use the company’s electronic platforms in all business transactions, ‘such that customers only come to the terminal for physical collection of cargo’. Russo further said that consignees can obtain and pay provisional invoices at any quick teller enabled ATM machines and select banking platforms. The electronic payment options developed by the company, he said, will enhance prompt service delivery and ensure social distancing in line with safety measures introduced by government to curb the spread of coronavirus. “For all persons visiting or working at our terminal, the use of hand sanitizers at all entry points is mandatory. This measure is in addition to the use of surface sanitizers and disinfectants to keep the environment safe in addition to embarking on public awareness for all port users,” he added.
COVID -19: GTBank announces 90-moratorium on SME loans OLUFIKAYO OWOEYE
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ier-1 lender, Guaranty Tr ust Bank (GTBank) has placed a hold on its loan repayment plan for all Small and Medium Enterprises (SMEs) that have obtained credit facilities from the bank. According to the biggest bank by market capitalization, this is to reduce the pain of the Coronavirus pandemic on SMEs amid the lockdown. The lender explained that businesses that obtained Food Industry Credit, Fashion Industry Credit, Quick
credit for business would be issued a 90-day moratorium on repayment of such loans. By implication, small businesses that fall within these categories would not have to repay their loan in the next three months but the interest rates on the facilities will still be paid. President Muhammadu Buhari had announced a 14-day lockdown which commenced 11pm on 30th March. The president declared the lockdown in order to curtal the spread of the COVID-19 pandemic which has disrupted business activities. The informal sector and
the self-employed have been worst-hit due to shut down if businesses, compared to large corporations whose workers have been working from home. At its last annual General meeting shareholders passed resolution to pay a final dividend of N2:80 per ordinary share of N0.50 to shareholders whose names appear on the register of members as at close of business of March 18th, 2020. As part of its contribution to the fight against Coronavirus, the bank donated a 110-bed isolation centre in Lagos. The project was completed within four days.
Pawan Sharma, chief executive officer, West Africa, Tolaram Group; Chris Ngige, minister of labour and employment, and President Muhammadu Buhari during a visit to the President at the Aso Rock Villa in Abuja
L-R: Kehinde Smith, chairman, board of governors, Igbobi College Yaba; Victor Adegbite, bishop, Diocese of Ikeja, Methodist Church Nigeria; Olumuyiwa Kinoshi, president, Igbobi College Old Boys’ Association, and Akinpelu Johnson, bishop, Diocese of Lagos Mainland, Anglican Church of Nigeria, at the Thanksgiving and Communion Service marking the 88th Founders’ Day Anniversary of Igbobi College, at the Rev Canon Parker Chapel, Igbobi College, Lagos.
L-R: Thompson Ukpebor, channel relationship manager, Lagos Island and Ogun, Lafarge Africa Plc; Richard Zhou, winner, Lafarge Retailers’ Promo, and Itune Brown, retail manager, Lafarge Africa Plc, at the Lafarge Retailer’s promo reward ceremony in Lagos.
KBL Insurance assures customers of continuous service MODESTUS ANAESORONYE
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s the COVID-19 virus continues to spread in Nigeria and the World, KBL Insurance has advised its customers to stay safe, while assuring that its services will continue to be provided remotely. In a statement released to its customers, the Company encouraged the proper maintenance of good hygiene, regular hand-washing, use of hand sanitisers, keeping hands away from the face, and adherence to social distancing guidelines of the Government and WHO.
The Company states that even though its physical offices, most specifically in Lagos, Abuja and other states that have been locked down, may not be open at the moment, personnel can be reached via email while the company’s website remains operational 24/7 for online purchase of relevant insurance products and quotes for other products. The statement assured KBLInsurance’s customers that their risk management needs will still be met by the Company despite the challenges occasioned by the COVID-19 pandemic. Recognizing the need for www.businessday.ng
an enlightened workforce in such a period, KBL Insurance had sufficiently educated its staff members on the risks of the pandemic and relevant precautionary measures to be taken for personal safety. Prior to the stay-at-home directive in parts of the country, the company had implemented various precautionary measures including temperature checks, hand-sanitising points, hand-washing points, and regular deep cleaning of the office premises with emphasis on touch points and work surfaces at its various locations, for the safety of its customers and stakeholders.
Covid-19 Lockdown: The Wife of the Governor of Ogun State, Mrs. Bamidele Abiodun Distributing Relief Items to the Vulnerable in Remo Axis of the state.
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Wednesday 15 April 2020
BUSINESS DAY
Wednesday 15 April 2020
BUSINESS DAY
17
Hafiz Bakare
CEOINterview
Former MD/CEO, Keystone Bank Limited
Interview with Private Sector Leaders
COVID-19 will slow down growth in Nigeria and across the world - Hafiz Bakare, Former MD/CEO, Key Stone Bank On 23rd of March, 2017 AMCON divested fully from Keystone Bank and handed the Bank over to new private owners who had emerged from the much-anticipated divestment process. Hafiz Bakare was appointed to lead the post-divestment transition as a bridge between the erstwhile AMCON-appointed board which he was a member of, and the transition board instituted by the new owners. On 1st of April 2017, Bakare assumed leadership of Keystone Bank as MD/CEO, successfully steered the transition during that crucial period and laid the foundation for subsequent growth. Three years after the divestment, Bakare speaks on his role particularly during the post-divestment transition and a variety of other contemporary issues. Excerpts Could tell us about your career before joining Keystone Bank? et me start by saying that I was appointed MD/CEO of Keystone Bank by the then new owners, the Sigma Golf/River Bank Consortium following the successful divestment exercise which led to the transfer of ownership from the Asset Management Corporation of Nigeria (AMCON) in March 2017. Before then, I was the bank’s Executive Director in charge of Corporate Bank and Treasury, and also overseeing the Lagos and West commercial directorate, having been appointed to the immediate past board by AMCON in July 2014. So, with that sort of background, I was not necessarily coming in from outside Keystone Bank. I had been in the bank for about three years before I was appointed MD/CEO to lead the transition from a government owned bank to a private financial institution. I have wide-ranging professional experience that cut across management consulting, banking, insurance, manufacturing, health and other sectors, locally and also across Africa. I was Chief Strategy Officer for First Bank of Nigeria PLC, where I was responsible for bank and group strategy; mergers and acquisitions; conception and incubation of new subsidiaries; group coordination; new business development; economic intelligence; local and international ratings; investor relations; brand management and corporate communications. Also, I was, at some point in my career at First Bank, overseeing the products portfolio covering consumer banking products, money transfer, agriculture business and wholesale banking products. In the course of my career, I was also Group Director at Industrial and General Insurance (IGI) PLC, an insurance conglomerate with business interests in other sectors locally and internationally. At some point, I was Non-Executive Director at a company called SONARWA i.e Societe Nouvelle d’Assurances du Rwanda, which is the premier insurance institution in Rwanda, as a representative of IGI on the board and as part of my oversight responsibilities. It may also interest you to know that I am a qualified Pharmacist. I equally have an MBA from IESE Business School, University of Navarra in Spain and was top of my class at the preparatory programme where I had a record of 25 As in 26 courses. My main consulting experience was nurtured at Andersen Consulting, which later became Accenture and I was on the firm’s outstanding track. Before I was appointed to the board
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of Keystone Bank as Executive Director in 2014 by AMCON, I was actually running my own management consulting and capacity development practice, which I founded to assist different organizations across different sectors, and post-Keystone, I have resumed management consulting practice among other business endeavours. I was also a Consultant for Knowledge Factory International, UK; an alumnus of the European Bank Training Network’s International Banking Summer School; a Senior Member of the Chartered Institute of Bankers of Nigeria; a Fellow of the Nigerian Institute of Management and a member of the Institute of Directors. In addition to these, I have received executive education at Harvard Business School, USA and Wharton School University of Pennsylvania, USA while I have participated in major international conferences including the IMF/ World Bank Annual Meetings, World Economic Forum on Africa, and Economist Conferences. I have also been a panelist at the African Business Conference of the Harvard Business School at some point and a council member of GLG, Gerson Lehrman Group, in the USA, which is the world’s largest knowledge brokerage and expert network comprising thought leaders and specialists in different fields. In a nutshell, that summarizes my modest career path, which has spanned a number of years. How did you start your leadership in Keystone Bank? What were your responsibilities when you joined them and what were your first pronouncements and actions as CEO? Like I said, I was appointed by AMCON to join the board as an Executive Director in charge of Corporate Bank and Treasury. We did what we needed to do to make sure that we worked with the available resources to improve things further in order to make a mark within the organization, providing adequate support to the then CEO, Philip Ikeazor. When it also happened that one of the Executive Directors who was in charge of the Lagos and West Commercial Directorate had to move on, I had to take on that additional responsibility. There were a number of other things that I had responsibility for as an Executive Director – for example, even the divestment programme itself that is, the divestment of AMCON from the bank, was within my purview from the bank’s side. So, I was the one designated by the erstwhile Board of Directors of the bank as Project Co-ordinator, to www.businessday.ng
oversee that entire process and I was managing the interface with different stakeholders. So, I mean that was what I had to do in my capacity as a member of the erstwhile AMCONappointed board. After the divestment, I was appointed to lead the transition by the new owners under a Transition Board with Alhaji Umaru Modibbo as Chairman while one of my colleagues on the AMCON Board Mrs. Yvonne Isichei was retained as an Executive Director. My leadership of the bank took effect from 1st April 2017, incidentally a Saturday, but the first working day was actually Monday 3rd April 2017. With respect to my first major pronouncements and actions on the way forward which were effected on the very first day as the CEO to lead the transition, let me mention a few: One was the strategic direction of the institution, which I had to indicate to all staff would be hinged on six major strategic imperatives that would drive all our activities thenceforth. These were (1). Governance; (2). Customers; (3). Employees and Resources; (4). Processes; (5). Delivery Channels – branches, alternative delivery channels; and finally, considering where we were coming from, (6.) Earnings. So, that was one of my first major pronouncements, stating basically that these would be the six major imperatives to drive every activity of the bank and that performance measurement with well-defined Key Performance Indicators would be intensified for every job position. In fact, what we did by publishing performance ranking or “league table” on a monthly basis, changed behaviour across the institution and also gave staff the assurance that change didn’t necessarily mean that we would start changing the people, because, of course, in any transition that’s the initial fear. Then, what we did in terms of external communication and engagement, was to send personal mails and letters to all customers of the bank between my effective date of assuming duty on 1st April 2017 which was a Saturday and the actual first working day on Monday 3rd April 2017. It was important for the CEO to personally engage all customers through mails and letters, so, we had that communication and basically it was to inform them, first, about my assumption of office, then to also indicate the successful completion of the divestment programme, that the bank had become a privately-owned financial institution. To also let them know about the leadership transition, seamless handover from the immediate past MD and to equally build confidence that I would leverage the institutional memory to the advantage of eve-
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ryone, in view of the fact that I was a member of the immediate past board and management of the bank. So, that message needed to go out, seeing as customers were a bit apprehensive, not knowing who the new owners were, but because I had been around, that gave them some level of assurance. In the course of the transition, we followed this with face-to-face business development and confidence building marketing calls to Chairmen and CEOs of our various major customers across the country while establishing new relationships. I also sent on that very first day, personal mails and letters to all CEOs of other banks, to introduce myself because I knew that I would be working with them thenceforth. And of course, like I earlier mentioned, there was personal communication in form of an e-mail to all staff of the @Businessdayng
bank, to lay down the strategic direction and my leadership philosophy. I subsequently had meetings with senior management staff. Later that same day Monday 3rd April 2017, I had a town-hall meeting with all staff of the Corporate Head Office, a faceto-face, real-time meeting with everybody in the building. In the course of the transition, we followed that with similar sessions across all the different regions of the bank to meet all staff around the country. You really understood the power of communication. What were your main objectives that led you to reach success and have the desired performance? The major objectives, like I’ve said, were anchored on six strategic imperatives, which I made very clear to all staff from the very first day. Recall I mentioned, governance, customers, employees,
processes, delivery channels and earnings. Those were the major anchors. Then, as part of these objectives we had looked at a few things that we felt were very key, going forward. There was need for some culture change and continued engagement, which was why we had to do all of those things about communication, being open and transparent. And then, capital injection. Of course, if you had a divestment programme it was expected that moving from being a government-owned institution to a privately-owned institution would substantially enhance the capacity of the bank to be able to do things that it hitherto was not able to do. So, under the “Governance” strategic imperative, we highlighted capital injection as one major anchor of what should ultimately happen going forward with the support of the new owners along with forbearances requested from the Central Bank of Nigeria, some of which were granted both during the transition
and subsequently. It was equally necessary to further build the confidence of customers to facilitate deposit mobilization and retention because the life blood of any bank, is to be able to mobilize deposits that you can lend to your customers. It was important that we built public confidence, such that we were able to retain existing customers and develop new business relationships, which provided foundation for post-transition customer attraction, retention and business growth. Something that had been an issue generally in the Nigerian banking industry and particularly at the time, was the issue of non-performing loans. As a player in the industry, the bank had its fair share of nonperforming loans. Some of those loans became non-performing, essentially due to the fact that the country had gone through recession and therefore, the companies operating within could not be completely divorced from what was happening in the economy. A number of the loans were both syndicated and stand-alone facilities in strategic sectors which had been affected by significant changes in the assumptions underlying the original government roadmaps even as these companies had significant verified government receivables. As the economy itself was gradually getting out of that recession, it was important for us to also find a way of working very closely with these customers. So, one of the major anchors was risk management, something that we were very keen on, particularly in the areas of loan recovery, rejuvenation of business activities along with resumption in meeting obligations and perhaps most importantly, collateral enhancement to ensure adequate coverage. We took concrete actions in these areas during the transition with positive results that transcended the period as the succeeding management followed this lead which was reflected particularly in first-half 2018 results underpinned by reversal of impairment charges. I had earlier mentioned branch transformation and this was about improving the façade of our branches as a form of brand projection. Would you say you succeeded in repositioning the bank and laid a good foundation for the subsequent management team? With all modesty, I would say yes! I have mentioned the bit about performance management, which remained very key. Performance stood at the very base of all the cultural transformation, by way of leading by example and the signal that came from the approach and www.businessday.ng
style of the leader. Everybody took a cue from that. So, with the cultural transformation and performance management it became clear that it was an open environment where anyone could succeed. You didn’t have to know anybody, you didn’t have to be my friend, just do what you had to do. We developed very clear performance parameters and followed the strategic direction which was well communicated to all staff leading to a very seamless and successful transition. Let me mention a few of the key highlights in addition to those already indicated: (1) Deposit liabilities increased significantly even within the first four months post-divestment despite the intensely challenging and competitive operating environment at the time, especially for a bank in transition. (2) Loan recoveries increased by over 100% and the number of profitmaking branches also increased considerably (3) There was 40% growth in activity levels on self-service channels and improved efficiency of operations with considerable growth in ATM transactions, POS collections, internet banking and mobile telephone banking volumes. (4) Alongside operational improvements, cost-to-income ratio improved consistently every month during the transition. (5) We enhanced controls leading to effective cost containment, revenue recovery through optimization of revenue assurance tools and enhanced compliance. Specifically, the bank successfully processed USA Foreign Accounts Tax Compliance Act (FATCA) with Global Intermediary Identification Number (GIIN), to facilitate correspondent banking relationship and thereby reduce cost. (6). On the 31st of July, 2017 after very intensive cross-functional teamwork which I supervised personally, we launched Keystone Bank’s Unstructured Supplementary Service Data (USSD) product with the original unique *533# short code so that we could stand to be counted in the industry. It was necessary to ensure our customers continued to have confidence in the bank and have every reason to enhance patronage as we offered them convenient service comparable to, and even better than what was offered by competitors. Our PIN driven product at the time was superior to a number of already established USSD offerings in the industry as we consciously combined customer convenience with security. This provided the foundation for the succeeding management which further fine-tuned the product with subsequent changes in the short code.
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So, under my leadership, we gradually repositioned the bank during the transition, building on the work done by the previous AMCONappointed team of which I was a key member. We put the bank on a turnaround path and laid the foundation for subsequent growth. wCan you give us a little bit about the growth prospect for Nigeria in the light of the COVID-19 crisis? The current situation has made the approved subsisting 2020 budget with its assumptions, revenue and expenditure projections, unrealistic. The Federal Government is already working towards adjusting the budget with a planned 20% reduction in capital expenditure across ministries, departments and agencies (MDAs) and 25% reduction in both recurrent and capital expenditure of government-owned enterprises leading to an estimated N1.5trillion reduction in the size of the N10.59trillion budget. And with the planned reduction in oil price benchmark for the budget from $57 per barrel to $30 per barrel, the implication is an increase in the budget deficit from N1.8trillion to possibly over N3trillion. Growth would therefore be a struggle in the circumstance! There has been a significant drop in oil price to 17-year low at under $30 per barrel due to the effect of COVID-19 on economic activities across the world with our major trading partners, some of the worst hit. This is coupled with the direct implication of the trade war between Saudi Arabia and Russia, having United States also in the mix. Notwithstanding our genuine diversification efforts through the non-oil sector, we still remain a mono-product economy driven by hydrocarbons. So, the dynamics of the oil industry as earlier indicated @Businessdayng
will ensure a drastic reduction in oil, hence foreign exchange revenue. Limited accretion to the foreign reserve due to reduced FX inflow would put pressure on CBN’s ability to sustain the naira at the level it has been for the past three years and we are already seeing the signs with CBN’s recent N380:$1 peg for interventions at the Investors & Exporters and Bureau De Change windows, which the apex bank has termed “price adjustment”. In view of this, planned FX borrowings by the government would have to be put on hold given the potential to spend more naira than budgeted to support servicing such loans if the pressure on the currency reaches a breaking point despite the controlled exchange rate management regime. And it appears this is well understood by both the executive and legislature given the current disposition to the proposal for $22.7 billion foreign borrowing which was initially enthusiastically pursued but now suspended. In that case, even the laudable infrastructure projects might be held back as government devises alternative sources of local funding like the N1.5trillion Infrastructure Fund, an idea which has just been conceived by the CBN working with the private sector to develop the modalities. So, putting it mildly and without delving into details on other macroeconomic variables, economic slowdown is expected but this would not be Nigeria-specific as the world economy and most individual economies across the world are expected to slow down as a direct result of COVID-19. I acknowledge government’s proactivity through the CBN with the earlier mentioned Infrastructure Fund and others amounting to over N3.5trillion to cushion the COVID-19 effects on the economy in addition to forbearances on loan structure and interest rates.
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Wednesday 15 April 2020
BUSINESS DAY
insurance today
E-mail: insurancetoday@businessdayonline.com
African Alliance supports NIA in the fight against corona virus Modestus Anaesoronye
N L-R: Sunday Thomas, acting commissioner for Insurance/CEO, National Insurance Commission; Folasade Joseph, managing director/CEO NAIC; and Bola Onanuga, president of The Nigerian Council of Registered Insurance Brokers during a press briefing by the Minister of Finance, Budget & National Planning, Zainab Shamsuna Ahmed on fiscal stimulus measures in response to the COVID-19 pandemic & oil price fiscal shock held recently in office of the Minister in Abuja.
Pension operators shut physical interaction with contributors, retirees over COVID -19, …association yet to ascertain impact of lockdown Modestus Anaesoronye
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ension Fund Operators and Mangers of the country’s over 8.5 million registered pension contributors say they are on total lockdown because of the nature of its services, which require large scale physical interaction with her retirees and contributors. “We are all at home because we are largely exposed to physical interaction with our enrollees, retirees and potential clients, and so for the safety of all of us, we are not opening our doors now until the COVID-19 issue is over, Ronke Adedeji, presi-
dent of the Pension Fund Operators Association of Nigeria(PenOp), said. But she noted that however that Pension Fund Administrators (PFAs) have online real-time electronic platforms that its contributors and retirees could use to resolve their challenges. On what the impact of COVID-19 and lockdown directive will be on the industry, Adedeji said “we are yet to evaluate the impact, like I told you, we are all at home trying to keep safe first. She said “the industry is reviewing the situation and whatever our response will be, we will let you know, she promised Business Day. The Nigeria’s pension fund assets as at 31st Decem-
ber 2019 hit N10.22 trillion, an increase of 18.28 percent from N8.64 trillion at the end of December 2018. From the total fund under management by the Pension Fund Administers (FFAs), the Federal governments borrowed through different kinds of bonds and treasury bills (Securities) 71.87 percent, amounting to N7.344 trillion. This is contained in the National Pension Commission (PenCom) monthly report released on Friday 7th February 2020. Breakdown of investment of the pension funds assets as at the end of December show that Federal government securities including FGN Bonds took N5.35 tril-
lion, equal to 62.39 percent; while Treasury Bills took N1.88 trillion, equal to 18.40 percent; Sukuk Bonds: 0.82 percent while Agency Bonds 0.11 and Green Bonds: 0.15 percent. From the analysis, money market securities received N1.172 trillion of the total funds under management, equal to 11.47 percent, with N1.055 trillion going into banks instruments, translating to 10.33 percent. Domestic ordinary shares investment, which has been dropping over time as result of poor state of the capital market during the period under review received N55.89.51 billion, equal to 5.41 percent of the total invested funds.
igeria’s foremost life insurer, African Alliance Insurance plc keeps true to its purpose of protecting the future of every Nigerian by making financial contributions to the Nigerian Insurers Association (NIA) Covid-19 support fund. The NIA Covid-19 support fund is an initiative of the Nigerian Insurers Association aimed at mitigating the further spread of the virus in Nigeria. The funds raised are to be used in acquiring and distributing protective gears to the public as well as to the healthcare workers who are at the frontline fighting against the Covid-19. African Alliance is further pleased to support this laudable effort as the NIA announced that the funds raised have made possible a donation of N1m free life insurance cover to healthcare professionals taking care of those infected with the virus. Recall that African Alli-
ance had earlier supported a food outreach to residents of Ikoyi-Obalende LCDA, its immediate community, in conjunction with Megalectrics Ltd, a media company based in Ikoyi and the LCDA. “We believe the government cannot do it alone, therefore it is our corporate responsibility to offer support and provide for the needs of those around us in these trying times. After all, we promised to be with them for life and that means through thick and thin,” Bankole Banjo, the firm’s Brand, Media and Communications manager said. Incorporated in 1960, African Alliance Insurance is a publicly quoted life insurance company operating out of Lagos as well as in 18 branches nationwide. Last month, the firm activated its business continuity plan which implemented specific health measures to curb the spread of the Corona Virus. This was done to ensure the safety of its customers, as well as its employees who are now working remotely.
Funmi Omo, MD, African Alliance
CHI extends rights issue to May 1 over COVID-19 lockdown Modestus Anaesoronye
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he Group Managing Director/Chief Executive Officer of Consolidated Hallmark Insurance Plc, Eddie Efekoha, has said the outbreak of coronavirus (COVID-19) was the cause of extension of the firm’s rights offer period to May 1, 2020, from the April 1, 2020, earlier approved by the Securities Exchange Commission (SEC). He added that it was owing to the fact that discerning investors would usually wait
to the last week of the offer before putting their money through, but has been disturbed by the lockdown. He seized the opportunity to give kudos to regulators for being supportive and proactive during this period. Efekoha also noted that having insurance policy or policies that covers one’s valued assets is the surest way of having peace of mind, stressing that as the entire world continues to grapple with the adverse effects of COVID-19, a deadly virus that literally crippled all facets of human endeavour, the need to leverwww.businessday.ng
age insurance in mitigating risks is of great essence. Efekoha who also doubles as the President of the Char-
Eddie Efekoha
tered Insurance Institute of Nigeria (CIIN) stated this recently during an interview session on Channel Television’s Business Morning programme, citing a couple of instances around the world where insurance has come through to rescue notable world events and businesses. Although he acknowledged that there are no insurance cover for pandemics such as Covid-19 in Nigeria, and that there are very few cases abroad, a high demand for the cover is however expected to rise in the coming weeks as people’s eyes would
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have been opened to the benefits of insurance. According to him, “In the days, months and years ahead, we expect insurance cover for pandemics and other infectious outbreaks to be in high demand and the insurance industry would be expected to come up with an appropriate response and when it is done, the insuring public would be made aware.” On the financial impact of the pandemic on the industry, he said the insurance industry, may not pay claims for business interruption flowing directly from the out@Businessdayng
break of Coronavirus due to the absence of the cover, but the sector remains poised to respond appropriately when business interruption occurs due to specified risks in policies like fire outbreak, explosion damage etc. He however noted that some burglars have taken advantage of the coronavirus lockdown by burgling shops of business owners whinare observing the lockdown directive of the Federal Government. In such case, if the business owners have insurance, they can be rest assured of a compensation.
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insurance today E-mail: insurancetoday@businessdayonline.com
Insurers donation to fight COVID-19 not compelled by NAICOM, say’s NIA Modestus Anaesoronye
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nsurance trade body, the Nigerian Insurers Association (NIA) has condemned an online report, not BusinessDay, which stated that insurance companies were compelled by the National Insurance Commission (NAICOM) to make donations to government for the fight against COVID-19. The NIA said, its members companies were never compelled by the regulator, but that donations to the COVID-19 fight was a voluntary contribution agreed by its members to support government efforts at this time. The 57 insurance companies in the country therefore debunked allegations that they are being compelled to contribute N10 million
each towards the fight against Coronavirus pandemic. Tope Smart, chairman of the NIA told Business Day in a telephone discussion that “we were never compelled by NAICOM, and what we did is the agreement of all our members”. Smart who also spoke to journalist on the development said the claim that their regulator, the National Insurance Commission (NAICOM) compelled them to make the donation was only put in public domain to embarrass the insurance industry. Smart who is also the Managing Director of NEM Insurance Plc, explained that the association decided to align with the private sector to support the efforts and initiatives of the Presidential Task Force, State Governments, Ministry of Health, Nigeria Centre for Disease Control (NCDC) to contain the spread by contributing to a fund
to provide N1 million life insurance cover and procure testing kits and protective materials for the use of medical personnel saddled with the responsibility to the tune of about N100 million. He said: “What happened is that we called a press briefing where we announced that we are providing N1 million free life insurance cover for each health personnel and allied professionals in the country who are attending to victims of Coronavirus (COVID-19) and also procure testing kits, protective materials worth over N100 million. “But the Acting Commissioner for Insurance, Sunday Thomas later called us that the Commission would want to join us to boost our plan, by also contributing to the fund that we have set aside in other to increase the benefits provided under the planned scheme. “We welcome the development
and at that point, we allowed the Commission to take the lead. We were happy that it then became an industry based project where other stakeholders in the industry can join the NIA”. He noted that on their part, they had earlier agreed to intervene in two folds. “We had arrangements to procure testing kits and protective materials for the use of medical personnel saddled with this responsibility. The materials were to be delivered to the NCDC. “Also in line with our profession as risk managers, we agreed as an association to arrange a special life insurance cover for all health personnel and allied professionals who are attending to victims of COVID-19. We decided to provide Death and Permanent disability benefits to the frontline staff who are exposed to a lot of risks”, he added.
L-R: Moruf Apampa, executive director, Operations, FBNInsurance; Kehinde Borisade, managing director/CEO, Zenith Insurance; Fatai Lawal, managing director/CEO, Sterling Assurance and Tope Smart, managing director/CEO, NEM Insurance and chairman, Nigerian Insurers Association during a press briefing to announce the provision of free insurance cover for frontline heath workers involved in managing COVID-19 Victims in Nigeria
We did not force insurance companies to donate for COVID-19 - NAICOM Modestus Anaesoronye
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nsurance regulator, the National Insurance Commission (NAICOM) says it never forced any insurance company to make donations towards the fight against Coronavirus. The Commission said it only called on the insurance companies to join hands and support governments at all levels in the fight against Coronavirus pandemic. NAICOM was responding to an online publication, not BusinessDay which reported that, NAICOM had in a letter directed to registered insurance companies to make donations of not less than N10 million to the fight against Coronavirus. Rasaaq Salami, NAICOM spokesman and deputy director said in a telephone conversation that the Commission is disappointed over the news, describing it as not only false and misleading, but mischievous. He explained that the commission only called on the companies to join in providing support for government at all levels to the fight against Coronavirus in the country. He said: “This report is not only false and misleading but mischievous. It is a deliberate attempt to embarrass the Commission.
CIIN calls for united front in fight against COVID-19 Modestus Anaesoronye
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he president of the Chartered Insurance Institute of Nigeria, Eddie Efekoha and the Director-General of the Institute, Richard Borokini have called for a joint effort by industry stakeholders to support the fight against the global pandemic, COVID-19. In a message to insurance industry stakeholders, Efekoha stated that the fallout from the current pandemic has called for citizens of the country to be responsible for their wellbeing as well as the safety of other citizens. Efekoha urged the public to observe all the guidelines and laws laid down by the relevant agencies including WHO, The Federal Ministry of Health, NCDC and State Government instruments.
The President of the Institute also extended his gratitude to the Nigeria Insurers Association, NIA for its health cover initiative which guarantees a N1 million free life insurance cover for each health personnel and allied professional attending to COVID-19 case. He stated that this scourge required a committed a joint effort by all stakeholders in the Insurance industry and beyond in order to combine resources and expertise for the ultimate victory. Efekoha also commended the regulator NAICOM for its palliatives to the industry and insurance companies who have commenced sensitization campaigns and equally pledged to contribute to a common kitty under the care of the NIA to procure testing kits and protective for medical personnel. He opined that in the fight against COVID 19, the extra mowww.businessday.ng
tivation for the frontline workers would come from tangible support from stakeholders to ensure efficient working tools are provided in order to ensure the protection of all lives as well as good welfare packages during this period. He equally commended the efforts and dedication of the Federal Government, Federal Ministry of Health, Nigeria Centre for Disease Control (NCDC), Lagos State Government and all other State Governments in combating the virus which has crippled the world economy. Similarly, Richard Borokini, director-general of the Chartered Insurance Institute of Nigeria, lent his voice to the crusade urging citizens of the country to observe the hygiene, isolation and quarantine procedures communicated by the agencies at the forefront in the fight
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against the COVID-19 pandemic. Borokini showered encomiums on all healthcare professionals in the heat of the battle and prayed that their efforts will not go in vain. He also lauded the NIA and Insurance companies for rising up to the challenge and contributing their bit to ensure that the Insurance industry can be reckoned with during this time. He expressed optimism that with all hands on deck and in cooperation, the nation would emerge victorious in this battle against an enemy which has already caused extensive damage to lives and to economies all over the world. While acknowledging the impact of events on the Institute’s calendar, he assured members that new dates for all the events affected by the Corona Virus pandemic will be communicated to members as soon as normalcy is returned. @Businessdayng
Rasaaq Salami, NAICOM spokesman and deputy director
“No insurance company is being compelled or forced to contribute to the COVID-19 fund. NAICOM only requested the support of insurance companies further to the agreement between her, the Nigeria Insurers Association (NIA) and the Nigerian Council for Registered Insurance Brokers (NCRIB) for a coordinated effort towards making a consolidated contribution to the fund as an industry”. He noted. He urged the public to disregard the report as false and bias.
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INSIGHT Leaders need to re-think, re-strategise and re-tool in time of crisis The Financial Institutions Training Centre (FITC) has demonstrated its corporate purpose and leadership role in the knowledge and capacity building space when it brought together leaders and luminaries from a broad spectrum of industries for a Leadership Summit webinar with the theme: ‘Leading in the time of Crisis’. Segun Adams writes that its achieved goal was to provide leaders and decision makers with insights to navigating a crisis for which no playbook had hitherto been envisioned or developed.
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very crisis presents both opportunities and threats to businesses. For the Coronavirus (COVID-19) pandemic, its impact on businesses has been devastating, with the entire aviation industry shut. The banking sector is also hit, with loan loss expected to escalate. The crisis has also thrown up opportunities that were previously imagined and raised leadership need for organisations. Banks are today adopting flexible working, e-working and remote working practices that were previously thought to be impossible. The entire banking sector is now driven by technology, with brick and mortar transactions almost eliminated even as a new work-culture is brewing. FITC has therefore held a Webinar version of its Leadership Summit with the theme: ‘Leading in a Time of Crisis’ where issues around leadership, human resource management, financial management and deployment of technology were brought to bear. The webinar provided clues that the world will not be the same again after COVID-19 pandemic, and business leaders must embrace a new business structure driven by technology. The speakers were senior vice chairman, Africa Standard Chartered Bank Group, Bola Adesola, who was the keynote speaker; group executive, Tech and Services at First Bank, Callistus Obetta; country head, human capital, Stanbic IBTC Holdings plc, Funke Amobi, and chief finance officer, Rand Merchant Bank, Adebayo Ajayi. In her opening remarks, Chizor Malize, managing director/CEO, FITC, said the webinar was an opportunity for the industry to learn from individuals who have done great things in the past, and still doing great things at present. This, she said, would enable companies and individuals to hold on to their portfolios, achieve desired goals and prepare for the post COVID-19 crisis period. According to her, the challenges being faced by companies have never been seen before, and there is a need for collaboration on the way out of the crisis. The event attracted participants from Europe, America, Nigeria, Tanzania, Nairobi, Asia, across other African countries. According to Malize, COVID-19 pandemic has presented an opportunity for business leaders to build confidence in their workforce, show empathy and leverage on technology. She believes that ICT has a big role to play in the success of today’s business while training of staff on the use of technology to enable work from home remains crucial. The FITC CEO disclosed that with the COVID-19 crisis, FITC had its business continuity plan in place
Chizor Malize
where it allowed its workforce to work remotely and presented the opportunity for continuous learning and knowledge sharing within the business environment. The keynote speaker, Bola Adesola described the theme of the webinar as apt. According to Adesola, the world has changed, including the way people live and do business. She said COVID-19 had had an enormous impact on people’s lives and businesses, hence the need for organisational leaders to effectively lead their teams to ensure continuity and profitability. “As a sense of danger and loss looms, the organisation’s priority is to ensure the safety, security and wellbeing of its workforce and managing business vulnerabilities, while maintaining some level of productivity. COVID-19 pandemic has already disrupted millions of people’s livelihoods. With the entire population isolating and quarantining, the downstream impact of the terrible scourge is going to be severe,” she said. She asked: How will business leaders maintain effectiveness in the time of crisis, such as this? For the bank chief who had managed a large part of the bank’s conglomerates during the Ebola crisis, companies needed to prepare for a crisis like this, and small business can also get information on how to manage the crisis. For her, there has never been a rehearsal for something like COVID-19. “The pandemic of today has never happened before. So many business contingency plans have to be modified to accommodate this. The current crisis is a completely new parawww.businessday.ng
digm for humanity, and leaders have to build their actions and decision making from a different perspective. It also takes a challenge to lead an organisation in a challenging transition like this,” she said. Adesola suggested that leaders must step up in a time of crisis. “Amid confusion and chaos, a leader must step up and bring order. A leader has to control his/her emotions, especially at the onset of the crisis. In spite of the overwhelming sense of confusion, the leader must demonstrate courage even in the midst of the storm. He/she has to make decisions even amid imperfect information and communicate decisions to the workforce and customers,” she said. To her, people should be forwardthinking, and there was a need to put structures in place that will help in leveraging technology. On the other hand, Callistus Obetta gave insight on what leaders could do with technology, the fourth industrial revolution, and how FirstBank was responding to COVID-19 pandemic, using technology to connect with its customers and workforce. Obetta said organisations needed to build resilient business operations beyond the lockdown period, and technology would continue to play a dominant role in achieving this. He said the boundaries between the physical, biological and technological walls are blurring, the convergence between robotics, artificial intelligence and Internet of Things is imminent. The combination of all these, he added, would create massive disruption.
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In her presentation at the event, Funke Amobi explained that crisis management was about organising, directing, and implementing actions that minimise the impact of a threat. It is about getting the job done and enabling workarounds when routines and resources do not work. She said people were critical to business and it was important to preserve their wellbeing, engagement and productivity levels during and after the crisis. Amobi, who focused on the three Rs: Rapid Response, Resilience Response and Recovery Response, described the COVID-19 era as an unprecedented one. She said in Rapid Response, companies needed to be swift in passing their messages in a clear manner to their customers and workforce. When employees are hit with COVID-19 news, they will start looking at how it affects their work. People management is a business responsibility, not a Human Resource responsibility. At Stanbic IBTC, we articulated the implications of the COVID-19 and communicated same to our staff. We assured them that preventive measures had been put in place and there was no need to panic,” she said. In the resilience response, the bank also used continuous communication and business continuity management, employee engagement, mitigating people risks, and people impact analysis and productivity analysis. The management continued to communicate and assure employees on what it is doing and the need for them to sustain their productivity. Also, Adebayo Ajayi gave insight on the CFO roles in the crisis era, saying CFOs need to dimension the effects of the COVID-19 pandemic on their businesses in the medium term, while carefully reviewing demand and supply requirements. “The CFOs need to dimension the immediate effect of the crisis and evaluate immediate liquidity position and available reserves. They have to gradually implement changes to ensure you stay ahead of completion when normalcy returns while putting measures in place to support their employees on how to adapt to the change and new technology,” he said. CBN deputy governor, Aishah Ahmad, lauded the management of FITC for the success of the webinar and its insightful theme given that organisations and economies were grappling with the fallout of the covid-19 pandemic and traditional ways of working and assumptions are increasingly becoming irrelevant. She also commended FITC for responding to the threat to businesses caused by the current pandemic through the innovative leadership summit, emphasising that the webinar has @Businessdayng
engaged organisations and leaders through knowledge and insights that equips them to paddle through the crisis period while stabilising their operations and portfolios. To cap what was indeed an engaging and illuminating session Chizor Malize, FITC CEO, assured the audience that FITC was committed to delivering more of such impactful sessions and solutions to its clients and stakeholders: “FITC is at the forefront of creating knowledge content and leveraging technology to deliver its services. We are an innovative and world class organization committed to building capacity for industries and strengthen the FSS as well as the Nigerian economy. We would bring forth more of this kind of session with diverse speakers, rich contents and learning.” Attendees included the Central Bank of Nigeria Deputy Governor, Financial System Stability and FITC Board Chairman, Aishah Ahmad; CBN Directors, Directors from NDIC, NAICOM and AMCON, senior management executives from First Bank, GTBank, FCMB, Union Bank, Fine & Country, and Rainoil Limited, among other senior level executives. There was no doubt the summit was impactful given the commendations and accolades that poured in during and after the event and the clamour from participants for more of such sessions. For Emmanuel Abolo, directorgeneral, Economic Thinktank Centre Limited, described the Leadership Summit webinar as a great initiative of FITC, knowledge impactful and full of remarkable learnings that will position and equip leaders to successfully navigate the current crisis. “It was as practical as it could get. We look forward to more from this FITC leadership series” Abolo said Tsukundu Yakubu, head, HR, Bank of Agriculture, was delighted with the insights she gained from the session. ‘Thumps up to FITC for making this Leadership Summit free and applying technology to deliver the programme’. Also, Kehinde Olojede, director, Centre for Endowment Development, Advancement and Alumni Relations (CEDAAR), it was a very insightful and excellent session. “Excellent webinar, a big appreciation to FITC for making this happen. And to the panelists for their well thought out presentation. Great insights we must continue to bear in mind even after the pandemic. It was a very insightful and excellent session indeed,” Kehinde Olojede. In the words of Wanza Kussiy, assistant director, Standard Association of Nigeria, “Great webinar from FITC, brilliant delivery by all the speakers, awesome dissemination of information worth having and building upon”.
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BANKING Assessing impact of post Covid-19 on banking sector Stories by HOPE MOSES-ASHIKE
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tability of the banking sector is crucial to keep economic activities up and running, given that it sits at the heart of the economy, providing funds to corporates and individuals. Without a doubt, the outbreak of COVID’19 has dealt a devastating blow on the banking industry, as confirmed by Uche Uwaleke, Professor of Finance and capital markets, Nasarawa State University Keffi. The business of banking is primarily about financial intermediation, that is mobilizing deposits and making loans. President Muhammadu Buhari on March 29, 2020 in a nationwide broadcast ordered the restriction of movement in Lagos, Ogun and Federal Capital Territory, Abuja, as a result of the persistent spread of Covid-19 in the country. The lockdown in major cities especially Lagos and Abuja that account for a significant proportion of banking business has hampered
deposit mobilization in no small way. Following travel restrictions and disruptions in supply chains, production has been scaled down for many businesses thereby raising the risk of loan defaults. So in a way, COVID’19 will reverse the gains already being recorded with respect to financial soundness indicators of the banking sector which has seen a reduction in Non Performing Loans (NPLs) and an improvement in capital adequacy ratio in
recent times, Uwaleke said. The banking sector NPL moderated from 6.59 percent in January to 6.54 per cent in February 2020, although the ratio remained above the prudential benchmark of 5.0 per cent, according to Godwin Emefiele, governor of the Central Bank of Nigeria (CBN). The capital adequacy ratio of the industry stood at 14.5 percent in December 2019, which analysts said was good in relation to the prudential requirement of 10 – 15 per-
cent. The fact is that the banking industry is currently losing a lot of income, not only from granting credit facilities but also from other services including opening letters of credit and executing standing orders many of which will be halted owing to the current crisis, Uwaleke said. On March 31, 2020, banks suspended indefinitely the cheque clearing in the nation’s clearing System starting from March 31,2020 as directed by the CBN.
The suspension followed the nationwide restriction order by president Buhari as part of measures to combat the spread of coronavirus. Akintunde Olusegun, financial market analyst at Polaris Bank Limited, looked at the impact of lockdown occasioned by Covid-19 and said, it would definitely redefine the entire industry going forward as more emphasis would be placed on digital and technology banking . “A sharp move away from the old fashion brick and mortal banking has become more inevitable due to the business impact of corona virus pandemic . Technology driven Business Continuity plan will replace the conventional alternative or disaster recovery centres, “he said. Looking the banking sector post COVID’19, Uwaleke who is the former Chairman of Chartered Institute of Bankers of Nigeria (CIBN), Abuja branch said it is likely to witness an increase in risk aversion by Deposit Money Banks and as a consequence a reduction in private sector credit. “So, there is no doubt that many lending institu-
tions will be loan shy. This will have a negative impact on profitability and may result in some cost cutting measures including laying off staff. Nevertheless, it is hoped that the Central Bank of Nigeria, through its Loan to Deposit Ratio and other measures including a possible relaxation of monetary policy, will assist the banks in weathering the storm and help to get the economy out of recession, “Uwaleke said. The CBN recently rolled out measures to safeguard the Nigerian financial system and the economy from the emerging headwinds. One of the key policies is the provision of extended moratorium on loans by an additional one year beginning from March 2020. This is to ease pressure on loan repayments. The banking sector regulator also reduced interest rates from nine to five per cent on its existing intervention programmes over the next one year. It created a N50 billion fund to support households and Small and Medium Enterprises (SMEs) affected by COVID-19, among other measures.
COVID-19: Heritage Bank joins WHO to celebrate health workers globally COVID-19 lockdown: Sterling continue to play significant a safer environment for them. Bank introduces palliatives for eritage Bank Plc last save and improve lives.” Commending the health roles to contain the spread week joined the According him, it calls for World Health Or- practitioners worldwide, Ifie of the disease, carter for the our collective joint action to customers’ comfort ganisation (WHO) Sekibo, managing director/ affected patients and embark combat COVID-19 since we
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in the celebration of “World Health Workers Week” and pay tribute to health workers globally for their selfless sacrifice and bravery in the fight against the novel Coronavirus pandemic causing countless mortality rates. The event is an annual commemoration of health workers but this year’s is scheduled to honour and advocate for health workers during the 8th annual World Health Worker Week slated for April 6 - 11, 2020. The theme for this year’s celebration is titled, “Leaders on the Line,” which according to WHO highlights the need to provide greater leadership opportunities for frontline health workers—particularly women health workers, who make up more than 70% of the global health workforce. It further explained, “At the same time, this theme emphasizes how health workers often put themselves on the line, often at great personal risk to themselves and their families, to
CEO of the bank stated that the COVID-19 pandemic has shown the world the heroic efforts health workers on the front lines make every day to keep their respective communities and the world safe and healthy. “Despite the havoc caused by the of coronavirus pandemic on individuals and the medical personnel who are not spared by the disease, they
Ifie Sekibo, managing director/ CEO, Heritage Bank www.businessday.ng
on research to attain robust understand of COVID-19. They also take steps further to proffer recommendation on how to remain safe, hale and hearty, whilst we all embrace the warmth and safety of our home. This is a calling for every individual within and outside to honor and support the brave healthcare workers doing lifesaving work on the front lines,” he stated. He, however, assured that as a bank “We are proud to join forces with health workers and agencies to help suppress the transmission of the virus, minimize social-economic impacts on the global community and work together to boost the nation economic growth,” Also, as part of effort to support and attain a more robust health system in the country, Sekibo has further called and encouraged government at all levels, key stakeholders, including the private sector to strengthen financial and technical support for health workers, as part of efforts to create
are in this together and we will get through this together. Meanwhile, Heritage Bank has assured customers of uninterrupted access to the various services, which they have been enjoying before now. This has been made possible with the activation of the bank’s business continuity management emanating from Heritage Bank’s corporate strategy to guarantee seamless service delivery to the various stakeholders. The bank also adopted a crisis response measures in place to minimise and manage the risk arising from COVID-19 and ensure that the payment infrastructure and logistics to maintain operations going as various State governments continue to observe lockdown to contain the pandemic. To ensure seamless banking transactions, the bank explained that customers are constantly communicated to, to adopt its available 24/7 alternate electronic channels.
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terling Bank Plc, has introduced some palliative measures for customers in a bid to cushion the adverse effects of the government ordered lockdown in parts of the country aimed at halting the spread of the dreaded COVID-19. Abubakar Suleiman, chief executive officer of the bank, who disclosed this in a statement said, “We understand that a lot of businesses have had to shut down their operations to curb the spread of the virus.” According to him, “This has taken a toll on the employment and source of livelihood for many people. We are offering a range of solutions to help Nigerians manage through temporary or extended periods of reduced or lost income as a result of COVID-19.” Among the measures taken so far, he said, is the reduction of the restructuring fees @Businessdayng
on all new and existing loans by up to 50 percent. Also, the bank has made provision for the extension of the repayment of loan obligations that are due. Suleiman said the bank has also suspended the penal charge for late minimum repayment on customer credit cards during this period. The CEO said doctors are on standby for free medical consultation on COVID-19 for the bank’s customers and employees anytime, anywhere because their health and safety remained a top priority. He explained that, for 60 days, customers and employees can have 24hour access to free medicals just by registering for the service. He added that customers of the bank who signed on to its novel and affordable health insurance scheme would access qualitative medical cover worth N500,000.
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Wednesday 08 April 2020
BUSINESS DAY
TRANSPORTation Motoring
RailBusiness
ModernTravel
Roads
Automakers adopt online marketing, sales strategies on COVID-19 … New-age consumers go digital on purchase decision
MIKE OCHONMA
MIKE OCHONMA Transport Editor
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utomakers and dealers across the world including dealer outlets in Nigeria feeling the negative impact of the coronavirus pandemic and the hammering global demand for vehicles have turned to online marketing and sales strategies as part of measures to remain in business until the pandemic abates. Since the outbreak of the coronavirus disease code-named COVID-19, many dealerships in Nigeria have either closed shop or are halfempty, with many of the marketing, sales and administrative staff asked by their respective employers to work from home as a measure to mitigate further spread of the global virus that has shut many economies down following the global lockdown. On the global front, automobile companies such as Hyundai Motor India, MG Motor and MercedesBenz are turning to online portals to boost sales, expecting customers to make a slow return to physical showrooms once the lockdown is lifted. MG Motor India’s online sales channel is scheduled to become operational by the end of the month. While Hyundai is accelerating the launch of its one-stop digital sales platform “Click to Buy.”, MercedesBenz, which currently sells preowned vehicles online, is adding new vehicles on its platform. As much as a quarter of vehicle sales are expected to happen online by 2025. New-age consumers have already started drawing heavily on online information to make vehiclebuying decisions. The spread of Covid-19 and associated preventive norms of social distancing will quicken the shift
to purchases online, auto industry experts said. “The coronavirus outbreak and the subsequent lockdown hastened our decision to opt for such a solution. We are expecting a profound behavioural change. We think more and more consumers would now start finding it more convenient to make purchases online”. MG Motor India President Rajeev Chaba said. Many of the portals will allow customers to research vehicles, make bookings, schedule test drives, avail themselves of financing options and determine delivery dates. All customer queries can be addressed via dealerships in real time and for customers who finalise purchases, delivery will take place once normal operations resume. According to WS Oh, executive director in charge of corporate planning at Hyundai Motor India, “Digital models of retail and sales are garnering traction among buyers. Customers are now factoring in convenience
to their purchase journey, even for products such as automobiles’’. “With the coronavirus situation, this (online sales platform) might be a great option for customers who want to buy a car but do not want to go to any crowded area,” said SS Kim, managing director at Hyundai Motor India. Indeed, auto companies such as Hyundai Motor India, MG Motor and Mercedes-Benz are turning to online portals to boost sales, expecting customers to make a slow return to physical showrooms once the lockdown is lifted. As much as a quarter of vehicle sales are expected to happen online by 2025. New-age consumers have already started drawing heavily on online information to make vehiclebuying decisions. Customer queries can be addressed via dealerships in real time and for customers who finalise purchases, delivery will take place once normal operations resume.
The spread of Covid-19 and associated preventive norms of social distancing will quicken the shift to purchases online, auto industry experts said. Rajeev Chaba, President, MG Motor India said the coronavirus outbreak and subsequent lockdown hastened the automaker’s decision to opt for such a solution. “We are expecting a profound behavioural change and think more and more consumers would now start finding it more convenient to make purchases online”. MG Motor India’s portal will allow customers to research vehicles, make bookings, schedule test drives, avail of financing options and determine delivery dates. “With the coronavirus situation, this (online sales platform) might be a great option for customers who want to buy a car but do not want to go to any crowded area,” said SS Kim, managing director at Hyundai Motor India.
‘Kia Promise’ extends vehicle warranties worldwide …Local franchisee to contact eligible customers MIKE OCHONMA
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ia Motors Corporation has announced the launch of the ‘Kia Promise’ which is a global warranty extension program for its vehicles. The programme is designed to support the brand’s customers whose movements may be limited because of the COVID-19 pandemic. The program covers 142 countries and all vehicles with original Kia warranties that expire between February 1 and April 30, 2020. The program extends the warranty of all eligible vehicles to June 30, 2020. Over 500,000 customers worldwide could benefit from the warranty extension. With many countries and businesses taking precautionary measures to counteract the COVID-19
Hyundai extends warranties to over 1m vehicles worldwide
pandemic, the Kia Promise aims to help customers who may be unable to visit a workshop during this time. It also helps customers who are not able to bring their car in for free servicing during the lockdown. www.businessday.ng
Sangdae Kim, senior vice president and head of global customer experience division at Kia Motors Corporation commented: “By extending Kia’s comprehensive warranty cover to customers who may
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be affected by the pandemic, Kia Motors hopes they have one less thing to worry about during this time. Our goal is to help to alleviate any concerns our customers have about vehicle maintenance during periods of social distancing”. Kia Motors Nigeria will contact all affected customers via emails and phone numbers in the coming days, with more details on the programme. Prioritizing the safety, health and the well-being of its customers, business partners, and employees, Kia Motors continues to closely monitor COVID-19 developments in communities where it does business, even as it continuously strives to prevent infections at its facilities while working with federal, state and local authorities, complying with all standards set by those entities. @Businessdayng
yundai Motor Company has launched Hyundai C A R E, a warranty extension policy for its vehicles worldwide. The program aims to support Hyundai customers who may face difficulties in getting vehicle maintenance due to restricted access to service centers during the COVID-19 pandemic. Hyundai C A R E ensures that all Hyundai vehicles with original warranties that expire between March 1 and April 30, 2020 will benefit from a warranty extension of up to three months until 31st May 2020. All warranties that are originally due to expire in May will also be guaranteed coverage until the end of the month. More than 1.21 million Hyundai vehicles in 175 countries will be eligible for the warranty extension. Hyundai’s decision comes amid a global reaction to the outbreak of COVID-19, which has caused many countries to take various precautionary measures that include closing non-essen-
tial facilities. With Hyundai C A R E, the company expects to help address any concerns customers may have about being unable to visit a service center to get vehicle maintenance or warranty repairs during government-imposed lockdowns. The well-being of the company’s customers and employees is a high priority at the company, which is closely monitoring COVID-19 developments and complying with measures in local markets to mitigate the spread of Coronavirus. Bang Sun Jeong, Hyundai’s vice president of Middle East and Africa said: “We appreciate that many of our customers may have limited or no access to vehicle servicing during these extraordinary times. “With Hyundai C A R E, we wish to set their minds at ease regarding eligibility for warranty repairs and related services in the coming months. Not only do we care about our customers’ health and safety, we care about the ‘health’ and safety of their vehicles as well.” Hyundai Motor dealers will contact all affected customers separately in the coming days, with more details about the Hyundai C A R E program.
Wednesday 15 April 2020
BUSINESS DAY
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TRANSPORTation Motoring
RailBusiness
ModernTravel
Roads
Nissan to cut 1m vehicles to annual sales target Toyota RAV4 gets …Under a restructuring plan, report says specification upgrade MIKE OCHONMA
MIKE OCHONMA
issan Motor Co. management has become convinced the struggling automaker needs to be much smaller and a restructuring plan due out next month would likely assume a cut of 1 million cars to its annual sales target, senior company sources said. Even before the spread of the coronavirus, Nissan’s sales and profits had been slumping and it was burning through cash, forcing it to pull back on an aggressive expansion plan pursued by ousted leader Carlos Ghosn. Unfortunately, the pandemic has only piled on urgency and pressure to renewed efforts to downsize, even as no new sales target has been finalized, and it remains unclear whether one will be formally disclosed. But Nissan’s plans for restructuring through March 2023 should be based on the assumption that it would only be able to return to annual sales of 5 million cars by then, two people familiar with the matter said, adding that, this would entail a large reduction to manufacturing capacity. That compares with a goal of 6 million cars for the same period outlined in July by then-CEO Hiroto Saikawa, who had already stepped back from around 8 million targeted under Ghosn. Nissan likely sold about 5 million cars in the past financial year, but this year’s outlook is bleaker due
ar enthusiasts should be expecting a refreshed offering as Toyota is in the process of upgrading the infotainment and driver assistance tech in its various models, and the latest recipient is the RAV4 SUV. The current-generation Toyota RAV4 was launched just over a year ago, so it’s too early for any styling or mechanical updates, but the automaker has subtly improved the look and feel of the base model’s cabin. For 2020, the GX model receives a leather-covered steering wheel and gear shift knob, replacing the previous urethane trim. On the multimedia side of
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to the pandemic. “For years, Nissan was looking for annual sales volumes around 7-8 million vehicles. The company has never managed to sell much more than 5 million or so,” one of the people told Reuters. Sources say the company can no longer consider this sort of wishful thinking. The resizing issue is really being taken into account as it has a lot of consequences on operations for 2020-2022. ‘’Mechanical, electrical and software systems of modern cars are often developed by suppliers and bring increasing integration challenges and program successes depends on close collaboration between automakers and suppliers’’. A third senior company source said the figure could be even lower than 5 million given the impact of the virus, which has hammered vehicle demand around the
world. The people declined to be identified as details of the turnaround plan have yet to finalized. Next July, Nissan said it was aiming to cut annual global production capacity to around 6.5 million vehicles. Shrinking its sales target by 1 million vehicles would equate to closing three to four more assembly plants and shedding thousands more jobs on top of already announced plans to cut its workforce by 10 percent. The cutbacks would also ripple through to its suppliers and dealers. Nissan declined to comment on its progress in devising a new mid-term plan. “The details will be shared in May,” a spokeswoman said. Key metric of the recovery plan will be its operating profit margin and new CEO Makoto Uchida is likely to keep Saikawa’s target for a margin of about 6 percent. At the very best, a downsiz-
ing is a given, one of the people said. In the third quarter, the margin was just 0.9 percent. Another top priority will be the preservation of cash. By comparison, operating margins at top-selling automakers Toyota Motor Corporation and Volkswagen Group before the coronavirus pandemic hovered around 8 percent. As of December, Nissan’s automotive operations had negative free cash flow of 670.9 billion yen ($6.2 billion), a more than six-fold increase from a year ago. “That’s no longer at an acceptable level,” said one of the people. Meanwhile, the Japanese automaker has requested a $4.6 billion commitment line from major lenders to cushion the impact of the pandemic while it seeks to engineer the desperately needed turnaround, people with knowledge of the matter have said.
Covid-19: Massilia Motors feeds 1000 Homes in Lagos MIKE OCHONMA
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assilia Motors and sole distributors of Mitsubishi Motors in Nigeria, has provided food items to 1000 homes in Ijora, a suburb of Lagos state, where the company’s headquarters is located. Food items including bags of rice, beans, sugar, salt, vegetable oil, pasta, tomato pastes etc were handed over to the traditional ruler of Ijora and an Oba; Abdul Fatai Aremu Aromire, the Ojora of Ijora, by a Massilia Motors team led by Kunle Jaiyesimi, the deputy managing director of the company,. While commending the efforts of government in checking the spread of Covid-19 in the country, the deputy managing director said the company’s
L-R: Marketing Officer, Massilia Motors, Hakeem Sanusi; deputy managing director of Massilia Motors; Kunle Jaiyesimi; Oba Abdul Fatai Aremu Aromire, the Ojora of Ijora; and head of marketing and corporate communication, Massilia Motors, Funmi Abiola; when Massilia Motors presented food items for 1000 families in Ijora, Lagos recently while maintaining social distancing.
gesture “is a way of alleviating the hardship that, the Covid-19 lockdown may have on the people in our neighbouring community”. It would be recalled that
President Muhammadu Buhari recently imposed a lockdown on Lagos and Ogun states as well as the Federal Capital Territory (FCT) as a measure to cope
the spread of Covid-19 in the country. Masilia Motors is a joint venture of CFAO and Chanrai Group, focused on automotive needs in Nigeria.
things, all 2020 RAV4 models receive an upgraded infotainment system with Android Auto and Apple CarPlay connectivity. The driver assist tech update, however, is reserved for the range-topping VX trim grade, which receives an upgraded Adaptive Cruise Control system that now operates at all speeds (previously it only worked above 40km/h). This should come in handy under a heavy traffic situation. The RAV4 is available with two normally aspirated petrol engines, those being a 2-litre unit with 127kW and 203Nm on tap and a 2.5-litre that is good for 152kW and 243Nm. Most of the range is front-wheel-driven, but the 2.0 GX-R and 2.5 VX are fitted with a permanent allwheel-drive system.
FRSC calls for sustained adherence to lockdown order MIKE OCHONMA
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orp Marshal of the Federal Roads Safety Commission (FRSC), Boboye Oyeyemi has called on all motorists to sustain adherence to the respective lockdown orders and adhere to the maximum safety and health standards in vehicles amidst the rising case of COVID-19 in the country. Oyeyemi said that all personnel have been adequately briefed on the imperatives of sustaining the tempo on the ongoing enforcement on overloading of vehicles and mandatory adherence to the social distance directive by all passengers on board, especially as the country continues to battle the deadly virus. Emphasis will be high on Lagos, Ogun and the Federal Capital Territory where presidential lockdown was imposed The Corps Marshal while
felicitating with the Christian faithfuls ahead of this year’s celebration of the crucifixion, death and resurrection of Christ, beckoned on them to manifest love care and obedience to established laws so as to portray the lessons of the Holy Week in positive light. He noted that FRSC will continue to sustain all arrangement on the lockdown as enforcement on all forms of overloading of vehicles and social distance order is still on, even during and beyond the celebration period as the country cannot risk unwanted spread of the virus beyond what has been recorded at the moment. While urging them to stay at home and stay alert, Oyeyemi further called on Nigerians to cooperate with law enforcement agents and ensure maximum compliance with all directives on restrictions and social distance.
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Wednesday 15 April 2020
BUSINESS DAY
Harvard Business Review
ManagementDigest
On the front lines at NYC’s Elmhurst Hospital Rishi Khakhkhar
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lmhurst Hospital, in Queens, New York, is a 545-bed city hospital that serves as a safety-net institution for a largely working-class immigrant population. The novel coronavirus has quickly spread through this vulnerable community, and the hospital is currently operating at more than 100% capacity. In an effort to free up precious beds, dozens of cases unrelated to COVID-19 are being transferred to other facilities. Inpatient wards are overwhelmed with those who, under different circumstances, would belong in intensive care units. This is the “epicenter within the epicenter” of the COVID-19 crisis in New York. It is also where, as a resident emergency physician, I spend most of my days. While the pandemic is a public health crisis, it is also a crisis of management, procurement and operations in our health system. A month ago, Elmhurst had no confirmed COVID-19 cases. Now, possible COVID-19 patients make up more than 80% of the emergency department. As the wave has crashed over Elmhurst Hospital, its leadership and team have responded with creative solutions while working in a bureaucracy not otherwise known to be lean, interactive or nimble. Despite the bleak outlook, Elmhurst Hospital took early, decisive action to rapidly transform itself into a COVID-19 treatment center. These crucial lessons — implemented onthe-fly at Elmhurst — include stemming the tide of relatively healthy COVID patients, tackling sticky bottlenecks and empowering the right leadership team. Here’s how we are managing. STEMMING THE TIDE In Italy, doctors observed that the emergency department is not the right place for most low-risk patients who appear well yet have flu-like symptoms. The majority of them were treated with over-thecounter medicine and frequent hydration at home. Health officials recognized that patients who didn’t have the virus were much more likely to contract it in the emergency department than in the relative isolation of their own homes. Following this observation, doctors at Elmhurst set up a tent — one of the first in New
York — outside of the emergency department. This stemmed the tide in three ways: First, it kept non-critically ill patients out of the emergency room and away from risk. Second, it allowed us to assign physicians who typically work in ambulatory clinics to the tent, freeing up ER doctors for the more critical cases. Finally, in the face of unprecedented demand, New York hospitals have constrained supplies that need to be judiciously managed for high-risk patients. Keeping the critically ill apart from the non-critically ill helps us allocate resources appropriately. No matter how your community handles it, reducing the pressure on your emergency department will allow staff to focus on the coming wave of critically ill patients. Other hospitals have been able to offload ER volume by quickly standing up telemedicine offerings. Your hospital may have other creative solutions. TACKLING BOTTLENECKS At Elmhurst, we’ve experienced three major bottlenecks to providing ideal care: 1. CLINICAL STAFF: The last thing we want is for a mostly healthy person to be sitting next to someone critically ill with COVID-19 in the emergency department. In the early days of the crisis, this was exactly what occurred. The bottleneck was staffing: Triage nurses who typically segment patients by acuity were in short order. Without www.businessday.ng
this crucial staff, patients languished in the waiting room, sharing space with other seriously ill patients. Erecting the tent and separating patients was part of the solution. The other side of it was rapidly updating policies that brought as many staff to the hospital as possible. We brought back needlessly quarantined nurses and also utilized advanced practice providers, such as physician assistants and nurse practitioners, as “super-triagers”: staff who could quickly evaluate and discharge otherwise healthy patients. 2. PERSONAL PROTECTIVE EQUIPMENT (PPE): The national shortage of gowns, masks, gloves and other materials that keep medical staff safe has created a bottleneck and forced us to find creative ways to conserve. For example, Elmhurst has contained suspected COVID patients in a specific, separate area of the hospital under negative pressure, which helps prevent cross-contamination between rooms. Providers working in a COVID section of the hospital can feasibly wear one N95 mask and face shield throughout a shift, while still protecting themselves from infection. While not an ideal long-term solution, it’s allowed Elmhurst to continue seeing and admitting new patients at a reasonable pace while slowing the burn rate of precious PPE. 3. VENTILATORS: Already,
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on multiple occasions, doctors at Elmhurst have scrambled to find a ventilator for a critically ill COVID-19 patient. We nervously anticipate the day when we will not have one. “Make more ventilators” is an obvious solution, but ventilators are complex machines, difficult to produce quickly, and they have been subject to an enormous surge in global demand. We need them immediately — not next month or next week. In response, we have freed up existing ventilators in operating rooms and obtained others from less affected hospitals in our health system. This has been possible only as elective surgical cases are put on hold, but it also offers a national model for finding urgent supplies in forgotten places. Many ambulatory surgical centers, for instance, are equipped with ventilators and should be transformed into makeshift intensive care units. EMPOWER THE RIGHT LEADERSHIP TEAM The most important aspect of Elmhurst Hospital’s response to the coronavirus pandemic has been a willingness to constantly adapt — as the tide strengthens and the bottlenecks narrow — to impossible pressures. By their nature, hospitals are bureaucratic structures with many layers of management. The key has been to empower a leadership team closest to the clinical reality. While working around @Businessdayng
the clock, Elmhurst emergency department leadership has had the freedom and insight to rethink workflows on the fly, create entire negative pressure areas that did not exist before and coordinate admission protocols that can be adjusted as the patient load mounts. WILL IT BE ENOUGH? My peers on the front lines are constantly using innovative strategies to take care of critical patients. So far, Elmhurst has been able to scramble one step ahead, but more difficult decisions — unproven treatments, rationing ventilators and more — are likely coming. While the ingenuity of our clinicians and leaders has steered us this far, I fear that Elmhurst is reaching the limit of what one hospital can do. So my final lesson from the front lines of COVID-19 is this: It is time for a swiftly coordinated effort between our local, state and national institutions to free the movement of ventilators, ramp up the production and distribution of PPE and create desperately needed ICUs from existing resources. We’re doing our best at Elmhurst, but unless we all work together, it won’t be enough.
Rishi Khakhkhar is a resident emergency physician at Elmhurst Hospital and Mount Sinai Health System in New York.
Wednesday 15 April 2020
BUSINESS DAY
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MARITIMEBUSINESS Shipping
Logistics
Maritime e-Commerce
NPA: Driving cost effective port operation amid Covid-19 crisis, movement restrictions amaka Anagor-Ewuzie
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t the early stage of Coronavirus outbreak in China otherwise known as COVID-19 and some parts of Europe, countries globally were faced with the challenge of containing the steady rise in the rate of spread especially as regards to reducing human contacts. Consequently, countries were forced to shut down their airspaces to human traffic and other sectors of business to keep their citizens at home in order to contain the spread of the deadly virus. But then, when the virus was declared a pandemic by the World Health Organisation (WHO), the global shipping industry was faced with two hard choices, to either keep the port business operational to enable the movement of essential goods or to shut the ports like the aviation sector, and face the economy consequences. At the end, it was agreed that shipping just like the food and healthcare sectors was critical to the movement of essential goods especially in countries like Nigeria that depend on import to bring in refined petroleum products, raw materials for the local industries, finished consumer goods and most importantly, drugs for the healthcare system. This was why, prior to the ongoing lockdown in Lagos alongside Ogun State and Abuja, President Muhammadu Buhari gave directive on March 29, 2020 that Nigerian major seaports in Lagos would remain open for business during the lockdown. By implication, President Buhari directed that Apapa and Tin-Can Island Seaports,
both in Lagos, must remain open for business during the lockdown in Lagos state. To actualise this, the Hadiza Bala-Usman led management of the Nigerian Ports Authority (NPA) came up with plans to ensure that ports remained open for import and export businesses. Firstly, the authority started discussion with state governments through the Presidential Taskforce on COVID-19 led by Boss Mustapha, Secretary to the Government of the Federation (SFG), to ensure smooth movement of goods across states without hinderance during the lockdown. Industry players believed that the smooth movement of goods would also help the NPA in dealing with congestion at Ports in Lagos, which has been on ground before the outbreak of the virus. Similarly, the authority believed that the drive to address port congestion should not be relegated to the background, this was why
it started engagement with the Nigeria Customs Service (NCS) to fast track the clearance of over 1,500 overtime containers. Customs has already inspected 400 of such containers and they would be moved to the Federal Lighter Terminal in Ikorodu, said Bala Usman during her recent inspection of terminals in Lagos Ports to ensure ports remain functional at optimal level during the lockdown. “Why we are calling on all consignees to come out and collect their cargo, they should also be mindful that some of these cargoes that are considered overtime would be moved to Ikorodu where they would be auctioned in line with the guidelines stipulated by NCS,” she said. Stating that lack of sufficient handling equipment has been identified as one of the reasons behind the congestion in the port, Usman warned that NPA in the revised concession agreement would ensure that there
would be penalties for terminals that fail to acquire equipment needed to improve efficient service delivery. BusinessDay check shows that in addition, the authority also rallied round all other government agencies responsible for cargo clearance at the ports by encouraging them to be at their respective duty posts to discharge their functions in line with the presidential directive. Meanwhile, to reduce the cost related difficulties experienced by port users due to lockdown in Lagos State, NPA also directed terminal operators to suspend all applicable terminal storage fees on consignments for an initial period of 21 days effective from Monday March 23, 2020. Adams Jatto, general manager, Corporate and Strategic Communications, NPA, who disclosed this in a statement, said the gesture was in recognition of the pressure, which the lockdown imposes on businesses. He noted that the devel-
opment imposed serious responsibility on the Authority to relief this burden on its customers as well as attain the objective of the Federal Government’s Ease of Doing Business Policy. “NPA recognises the financial implications of these policies on the terminal operators and will consider a shift in our operational charges to ameliorate the situation of stakeholders,” he assured. BusinessDay also discovered that this directive generated several controversies at the nation’s port as terminal operators refused to comply due to the uncertainty trailing the repayment of the waived sum. Terminal operators argued that the cost would be a huge burden on their bottom line, adding that there would be no need to waive rent charges as Nigerian ports and some commercial banks involved in receiving import duty payment have remained operational despite the lockdown. However, NPA in a letter dated April 8, 2020 with reference number HQ/GM/MRS/ OP/L.1/Vol. II/371 titled; “Re: Relief Measures to Port Users Due to Outbreak of Covid-19,” assured that the authority would payback using credit notes that commensurate to the rental reliefs granted by each terminal to consignees. The sample of such letter, which was signed by Ugo Madubuike, general manager, Monitoring and Regulatory Services, for the Managing Director, and addressed to the managing director of Eko Support Services Terminal Ltd, a copy of which was obtained by BusinessDay, stated that the compensation would only cover cargoes situated in the terminal within the
period under reference. “The terminal must produce evidence of delivery records indicating waiver of rent for the period in reference. The compensation shall only cover storable cargoes within respective terminals as well as charges approved by the Authority and published by the terminal. Any charge outside these will not be accommodated,” Madubuike stated. Confirming this, BalaUsman told newsmen that the federal government would look at the amount terminals forfeited by given importers rent-free days and would reimburse them through credit for the same amount. She warned that going forward, this measure would not be encouraged in order not to give room for congestion. Usman, assured that the authority would work to resolve other challenges experienced by terminal operators due to the lockdown imposed on Lagos State, noting that the agency was collating the challenges of all terminal operators and would pass them to the appropriate agencies for actions. She pointed out that the government was committed to having smooth operations at the port during this period in other to keep the economy running. Apart from these efforts, the NPA and its shareholders also donated the 130-bed fully furnished Agura Hotels located in Abuja to the Federal Government, to serve as isolation centre for COVID-19 in Abuja. Jatto, who disclosed this, described the gesture as a social responsibility initiative aimed at supporting efforts of the Federal Government to contain the spread of the virus in Nigeria.
NIMASA extends validity of trading certificates for Nigerian flagged vessels, seafarers amaka Anagor-Ewuzie
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etermined to keep shipping business moving amid the outbreak of Coronavirus pandemic otherwise known as COVID-19, the Nigerian Maritime Administration and Safety Agency (NIMASA) has extended the validity of statutory and trading certificates for all Nigerian registered vessels, crew change as well as the Standards of Training Certification and Watch-keeping (STCW) issued by the agency. “The extensions would enable owners and masters
of ships to permit personnel to continue performing their duties in the view of the prevailing extraordinary circumstance of the COVID-I9 pandemic and the nationwide lockdown in Nigeria,” stated NIMASA in a Marine Notice issued at weekend, which was signed by the management. The agency attributed this to the International Maritime Organization’s (IMO) circular letter No. 4202/Add5/Rev.1 dated 2nd April 2020, on guidance relating to the certification of seafarers and fishing vessel personnel, which encouraged Flagged States and Port State Authorities to take practical approach conwww.businessday.ng
cerning the extension of certificates and endorsements. According to the notice, IMO in another circular dated 30th March 2020 further called on governments around the world to designate seafarers and marine personnel regardless of nationality as key workers providing essential service, and to grant them necessary exemptions from national travel or movement restriction. NIMASA further stated that it has also extended the validity of related certificates with expiration dates starting from Ist March 2020 and lst July 2020 for three months or until the full resumption of working
operations in the agency. It further reads: “Extension of the validity of the STCW certificates, certificates of safety training and certificates of medical fitness issued by the Agency if they would otherwise expire between Ist March 2020 and lst July 2020 (both dates inclusive), for three months from the expiry date printed/typed on the relevant certificates.” The agency also extended the validity of other certificates including Certificates of Competency and Certificates of Proficiency, GMDSS radio operator certificate, certificate of safety or certificate of proficiency as a cook.
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The notice further stated that the extension will apply to all Nigerian flagged vessels and seafarers sailing on-board Nigerian flagged vessels and seafarers with Nigerian Certificate of Competency, who are sailing on foreign flagged ship. While stating that crew change/travels from and to vessels in Nigeria is subject to obtaining clearance from the Port Health and the Nigerian Centre for Disease Control (NCDC) concerning status on COVID-19, the notice pointed out that whenever the revalidation of the expired certificate is to be carried out, the new validity shall conform @Businessdayng
with the usual cycle and shall be dated from the original certificate expiry date. Confirming this, Bashir Jamoh, director general of NIMASA stated at the weekend on his official twitter handle @ JamohBashir that NIMASA issued a follow-up Marine Notice to extend the validity of various statutory and trading certificates to mitigate potential COVID-19 disruptions on the interests of Nigerian flagged vessels and Seafarers. According to him, many NIMASA officials would be working remotely during this time even as he added that all hands must be on deck to keep global shipping chain moving.
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Wednesday 15 April 2020
BUSINESS DAY
news 54gene secures $15m Series A round to scale human genetics research FRANK ELEANYA
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frican genomics company, 54gene, has secured $15 million Series A round to scale operations in support of generating novel insights from human genetics research that result in high impact discoveries for improving human health through therapeutic development. The funding is led by Adjuvant Capital, a San Francisco health investment firm backed by the International Finance Corporation, Novartis and the Bill & Melinda Gates Foundation. The round included participation from Raba Capital, V8 Capital, Ingressive Capital, and follow on investment from Y Combinator, Better Ventures, Fifty Years, KdT Ventures, Aera VC and Pioneer Fund. In July 2019, 54gene secured a seed round of $4.5m which brings the company’s total VC investment to $19.5m. The investment will also be used to accelerate discovery capabilities by bolstering operations in genetics, bioinformatics, preclinical, clinical and commercial programmes. “This new partnership marks a significant evolution in the growth of our company,” Abasi Ene-Obong, founder and
CEO of 54gene, said in a statement received by BusinessDay. “In the coming months, we will be focusing on building a genomic resource that we hope will add significantly to global health, while also translating to the health benefits of patients in Africa. We will also be expanding our collaborations in Africa with both public and private stakeholders and investing in setting up a stateof-the-art research lab with high-throughput genetic processing and BSL 3 capabilities in Nigeria, and ensuring that we build some of our innovative pipelines on the African continent,” Ene-Obong said. Launched in January 2019, 54gene seeks to address the significant gap the genomics market currently poses for Africa, and build and use African genetic data sets to make landmark discoveries to support therapeutic development. As of 2018, less than 3 percent of the data used in Genome-wide Association Studies (GWAS) were of African ancestry and currently, less than 1 percent of global drug discovery occurs on the African continent. Located in Nigeria and in the US, 54gene aims to improve the development, availability, and efficacy of medical products that will prove beneficial to Africans and the wider global population.
Nigeria’s economy to contract by-3.4% in 2020, says IMF
... to grow by 2.4% in 2021, inflation to rise by 13.4% in 2020 ... analysts differ on growth projection HOPE MOSES-ASHIKE & BUNMI BAILEY
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he International Monetary Fund (IMF) on Tuesday projected Nigeria’s economy would contract by -3.4 percent in 2020 from 2.2 percent in 2019. The Washington-based Fund expects the economy to grow by 2.4 percent in 2021. Gita Gopinath, IMF chief economist, disclosed this while presenting the world economic outlook at the ongoing virtual Spring meeting of the IMF and the World Bank group in Washington D.C. Inflation rate is projected to rise by 13.4 percent in 2020
from 11.4 percent in 2019, and to moderate to 12.4 percent in 2021, higher than the Central Bank of Nigeria’s single digit target of 6-9 percent. On Nigeria’s current account, IMF projects -3.3 percent contraction in 2020 from a negative of -3.8 percent in 2019. Damilola Adewale, a Lagos-based economist and independent consultant, said IMF’s forecast for full year 2020 looks pessimistic. It’s no brainier that Nigeria’s economy will contract by H1 2020, Adewale said. However, by H2 2020, the virus should have been arrested, global economic activities would return to normalcy, and oil prices would rebound (since
OPEC+, G20 pact would have been effective). “So, putting these together, relatively average growth performance in H2 2020 will moderate the impact of contraction of H1 2020 on fullyear growth numbers. So -3.4 percent is somehow unrealistic,” Adewale said. According to IMF, global growth is projected at -3.0 percent in 2020, an outcome far worse than during the 2009 global financial crisis. The growth forecast is marked down by more than 6 percentage points relative to the October 2019 WEO and January 2020 WEO Update. Other regions are projected to experience severe
slowdowns or outright contractions in economic activity, including Latin America (-5.2 percent), with Brazil’s growth forecast at -5.3 percent and Mexico’s at -6.6 percent; emerging and developing Europe (-5.2 percent), with Russia’s economy projected to contract by -5.5 percent; the Middle East and Central Asia (-2.8 percent), with Saudi Arabia’s growth forecast at -2.3 percent, with non-oil GDP contracting by 4 percent, and most economies, including Iran, expected to contract; and sub-Saharan Africa (-1.6 percent), with growth in Nigeria and South Africa expected at -3.4 percent and -5.8 percent, respectively.
Investors mapping out modalities to operate Tin-Can, Lilypond Parks, says NPA … new arrangement seen eliminating extortion, clogging of trucks along port access roads AMAKA ANAGOR-EWUZIE
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rivate investors that won the deal to take over the operations of Tin-Can Island and Lilypond Truck Parks are currently working out modalities to begin operations at both parks, the Nigerian Ports Authority (NPA) has said. At the completion of the modalities, private operators would oversee movement of trucks accessing Apapa and Tin-Can Island Ports. Jatto Adams, general manager, corporate and strategic communications of NPA, confirmed this to BusinessDay over the telephone. Adams said both investors actually took over the parks on April 2, 2020 but were still trying to map out the modalities to operate both parks. “This was why the NPA has not been able to come out with any pronouncement concerning the takeover of both parks by new investors,” he said. Adams said the NPA was yet to know how both parks would be run by both investors, whether or not it would be on pay-as-you-use basis.
He said NPA was also drafting the agreement with the private investors, assuring that it was only when all the arrangements are concluded that the authority would make public the terms of the transaction. Remi Ogungbemi, chairman, Association of Maritime Truck Owners (AMATO), told SHIPS & PORTS that the TinCan Trailer Park was handed over to MOB Integrated Services Limited while the Lilypond Truck Park would be managed by Truck Transit Park Nigeria Limited. Ogungbemi also confirmed that the investors were yet to roll out modalities for the management of the truck parks. He said the new arrangement would eliminate extortion of truck drivers, reduction in the number of security operatives and clogging of trucks along the port access roads. He further said that for effective management of both parks, all trucks including petroleum tankers must be compelled to leave the roads to their private parks and garages where they would be called when it is their turn to load. www.businessday.ng
Law enforcement agents enforcing the directive of Sani Bello, governor, Niger State, on day one of the total lockdown to mitigate the spread of Covid-19 at Gauraka Junction, along Zuba/Kaduna Expressway, Tafa LGA of Niger State. Pic by Tunde Adeniyi
Historical data offer comfort to equity investors amid market rout MICHAEL ANI
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aking positions in the stock market at a time like this, when the economic downturn from the coronavirus pandemic has made valuations of most blue chip companies cheap, could be one of the biggest gains for long-term investors if historical data are anything to go by. Since the start of the year, stock markets across the globe have taken a pummelling with no indication of how low the crash will go, as the implications of an escalating coronavirus outbreak and slumping oil prices spook investors. The global stock markets have seen some of their worst days in history recently, and the Nigerian equities market is not left out of the downturn as the novel coronavirus rips
across the world and paralyses economies. For the Nigerian Stock Exchange (NSE), the market is down as much as -18.49 percent year-to-date, according to BusinessDay data, as investors try to weigh the impact of the deadly virus that has infected over 1.7 million people globally and brought economic activities to a halt. About N1.814 trillion of investors’ wealth has been lost in the equities market since the year started, and this is due largely to the outbreak. The downturn has marked a dark time for those with a toe in the market and sparked anxiety, especially among new investors, who had been riding high on continued market rallies over recent years. But this isn’t the first time – and won’t be the last – the market would experience such
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a dip, providing clarity and a good opportunity for investors to get their strategy in check. Historical data tracked by BusinessDay show that market recovery could be very swift after an economic downturn, and long-term investors who are bullish at the time of the market downswings get a good run up for their money. “We have been in a similar scenario before and history has shown that the markets bounce back time and time again,” Moses Hammed, an analyst at financial services firm Investment One, said. When a collapse in global oil prices that started in 2014 pushed Nigeria into its first recession in about 27 years, the stock market bled greatly dipping as much 34.97 percent from 2014 through 2016. In 2014, the market posted a negative return of -13.15 per@Businessdayng
cent. In the wrap of the market in 2015, the Nigerian equity market dipped further by -17.36 percent, while in 2016, the downturn moderated by just -6.17 percent. In the three-year period, the net worth of the market declined by N3.98 trillion from N13.23 trillion in the start of 2014 to N9.25 trillion at the end of 2016. This was due to the mive outflows after the fall in oil revenue alongside a depletion of the reserves triggered an acute dollar shortage as foreign portfolio investors booked increased demand for the dollar. The market reversed from its three-year losing streak, helped by the CBN’s move to create a window where investors could get dollars conveniently at a marketdetermined rate.
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news World Bank warns ‘copy-cat’... Continued from page 1
Nkechinyere Ugwu (r), Imo State commissioner for gender and vulnerable groups, directing the distribution of relief items to orphanage homes in Owerri.
GenCos, states to take stakes in DisCos ... As panel proposes ways to fix power sector secretary, Association of Nigerian Electricity Distributors (ANED), when contacted for comment, said he would need to see the full report before he could speak on the matter. Apart from El-Rufai, other members of the committee that prepared the report include the governors of Edo, Anambra, Adamawa,PlateauandLagosStates with input from professional consultants, PwC Nigeria and KPMG Nigeria. It was submitted to NEC on March 19 and would be eventually sent to the Federal ExecutiveCouncilforratification. The report recommends that the electricity market should be governed by contracts and players including GenCos/IPPs, Transmission Company of Nigeria (TCN), DisCos and gas suppliers, backed by payment and performance guarantees. To resolve the electricity market shortfall estimated at over N2.4 trillion, which consists of market shortfall of N1.335 trillion caused by DisCos’ inability to collect adequately and fully remit their collections and tariff shortfall of N1.109 trillion caused by the regulator’s decision not to allow cost-reflective tariffs, the report recommended
that market rules apply and players act based on WillingBuyer-Willing-Seller (WB/ WS) arrangements. The report proposes the recapitalisation of the DisCos by encouraging GenCos to invest in them so that they can bring in their capital and management expertise. Joy Ogaji, executive secretary, Association of Power Generation Companies (APGC), when contacted, said she could not speak to whether GenCos would be open to the arrangement until there were clear guidelines. “GenCos are open to solutions provided they are not political prescriptions without benchmarkable plans on implementation,” Ogaji said. On financing, the report recommends implementing and expanding existing infrastructure finance support programmes to augment distribution,transmissioninfrastructure and rural/off-grid programmes. Some of the programmes already in the works include the $1.6 billion due to the TCN, the proposed Siemens deal which is yet to be determined, the World Bank funding of $1bn, and $550m funding support for the Rural
Electrification Agency. The report recommends that government “provide clear policy guidelines to regulators (NERC, CBN) and market participants regarding strategic objectives above, return market to regulatory norms with the Nigerian Electricity Regulatory Commission (NERC) acting to execute its statutory obligation to create and implement efficient market design to ensure quantitative/qualitative improvements”. It further recommends that governance of DisCos be focused on adherence to regulations, rules and contracts and efficient investment in infrastructure and customer service delivery. To resolve governance issues in the power sector, the board composition of DisCos would now include representation of states and local governments with 27.3 percent as just the core investors and the Bureau of Public Enterprise (BPE). NERC would have to enforce a requirement for each DisCos to have independent directors and BPE would exercise its veto rights in supervising DisCos’ management.
Governor Emefiele outlines 8-point...
ing trend whereby nations are imposing prohibition on their exports, the CBN governor said “India is in a position to ban exports because it is producing critical drugs and medical supplies that the rest of the world needs. “It also has companies that are global champions and even making mergers and acquisitions in advanced nations. Why should this be out our reach,” he asked. “We have the companies
too; we have the manpower and some of the best brains in the world from America to Europe and from Asia to Africa are Nigerians; driving global innovations in fields. “Nigerians are successful everywhere and are already one of the most sought-after immigrant groups in the United states, But now is the time to seize this opportunity and create an environment that empowers our people to thrive within their shores.”
ISAAC ANYAOGU
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ower generating companies (GenCos) and states should have stakes in distribution companies (DisCos) to resolve the intractable electricity challenge in Nigeria, according to recommendations by a government panel. The report of an ad-hoc committee by the National Economic Council (NEC) on reforming the power sector, exclusively obtained by BusinessDay, recommends altering the ownership structure of the DisCos. The committee, headed by Nasir El-Rufai, Kaduna State governor, recommends that states play a leading role in the sector by allocating at least 27 percent shares out of the 40 percent government equity in the DisCos to the state and local government, while the Federal Government retains the rest. It also recommends that GenCos be encouraged to invest in DisCos to aid their recapitalisation, players observe contract terms, and operators respect governance rules. Sunday Odutan, executive
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enables critical thinking and creativity which would
better prepare children for the world of tomorrow. Others pillars forming his pathway to a greater tomorrow for Nigeria are developing a healthcare system that is trusted to keep all Nigerians healthy, irrespective of social class; facilitating
access to cheap and long term credit for SMEs and large companies; developing and strengthening pro-poor policies that bring financial services and security to the poor and the vulnerable and expediting the development of venture capitalists for nurturing new ideas and engendering Nigerian businesses to compete globally. Drawing from the ongowww.businessday.ng
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movement except for providers of essential services, a measure Nigeria has adopted for some of its main states, could lead to an increase in poverty and endanger lives and livelihoods due to the collapse in economic activity and macroeconomic instability, the World Bank warned. “A prolonged lockdown will put at risk the subsistence of their households,” said the Bretton Woods Institution. “The majority of workers hired are in a precarious situation, and most of these jobs are temporary and with low remuneration, do not offer social security, and put workers at a greater risk of injury and ill health.” World Bank’s warning which came less than a week to the extension of Nigeria’s lockdown by President Muhammadu Buhari on Monday, noted that challenges African economies face stem from their large informal sector which accounts for 89.2 percent of all employment. Also, concerns are that small and medium-sized enterprises (SMEs), an important driver of growth in economies across the region, account for up to 90 percent of all businesses and represent 38 percent of the region’s GDP could be affected while the third fear is that interest rate cuts in several African countries in line with monetary policy actions around the world will be ineffective. Since March 30, Lagos, Nigeria’s commercial capital, Ogun State, a growing industrial centre, and Abuja, the federal capital, have been on lockdown to curb the spread of the COVID-19. According to a recent report by Enhancing Financial Innovation & Access (EFInA), a financial sector development organisation that promotes financial inclusion in Nigeria, COVID-19 could affect the livelihood of 50 percent of the 99.6 million Nigerian adult population who earn their income on a daily or weekly basis. Data from EFInA show that 32 percent of Nigeria’s adult population earn their income daily, 17.5 percent weekly, 18.5 percent income monthly, 5.5 percent earn annually, 18.5 percent earn income occasionally or upon completion of job, and 8 percent earn no income. For Lagos, around 60 percent of the adult population are vulnerable while 63 percent and 40 percent of adults in Ogun and Abuja, respectively, are at risk. In Nigeria, the informal sector accounts for 65 percent of Nigeria’s economy, according to the International Monetary Fund (IMF). Participants in these sectors in Nigeria’s main cities have been asked to stay at @Businessdayng
home, yet relief materials provided by the federal and sub-national governments have left much to be desired. According to BusinessDay findings, contrary to the state government’s promise that an economic stimulus package comprising bags of rice, beans, garri (cassava flakes), bread, dry pepper, potable water, and vitamins would be distributed to each household, single units were instead distributed per multiple households and in some cases, a whole street. Similarly, the impact of direct cash transfers by the Federal Government has been limited due to low coverage, posing a challenge for policymakers. In an article published by Quartz Africa, W. Gyude Moore, a visiting fellow, Centre for Global Development, argued that curfews, not lockdowns, would be appropriate for the continent with large informal economies. Citing the example of South Africa, Moore said access to public spaces can be reconfigured without a total lockdown. He also suggested enlisting local community leaders to ensure compliance with movement restrictions, mandatory mask-wearing, continued improvement in testing and direct payment and cash transfers to curb the spread of the disease. This is in line with World Bank’s advice for a twopronged strategy of saving lives and protecting livelihoods. “In this context, policymakers in the region need to design effective strategies that include (short-term) relief measures and (mediumterm) recovery/stimulus measures,” the World Bank said. The global lender said the reduced effectiveness of (traditional) monetary stimulus implies that this two-pronged strategy to combat the COVID-19 pandemic would have to rest on the shoulders of fiscal policymakers, which means African policymakers should aim at strengthening health systems, providing income support to (formal and informal) workers, providing liquidity support to viable (formal and informal) businesses and guaranteeing the provision of public and government services. The World Bank also said financing relief and recovery measures would require assistance from multilateral organisations and bilateral official creditors in a region that is already facing public debt vulnerabilities. “Finally, African policymakers need to think ahead about the exit strategy from COVID-19. Once the containment and mitigating measures are lifted, economic policies should be geared toward building future resilience,” the global bank said.
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INSIGHT Turning the Covid-19 tragedy into an opportunity for a new Nigeria Continued from backpage that is trusted to keep all Nigerians healthy, irrespective of social class; 6) Facilitate access to cheap and long-term credit for SMEs and large corporates; 7) Develop and strengthen propoor policies that bring financial services and security to the poor and the vulnerable; and 8) Expedite the development of venture capitalists for nurturing new ideas and engendering Nigerian businesses to compete globally. India is in a position to ban exports because it is producing critical drugs and medical supplies that the rest of the world needs. It also has companies that are global champions, and even making mergers and acquisitions in advanced nations. Why should this be out of our reach? We have the companies too; we have the manpower and some of the best brains in the world from the Americas to Europe and from Asia to Africa are Nigerians; driving global innovations in all fields. Nigerians are successful everywhere, and are already one of the most sought after immigrant groups in the United States. But now is the time to seize this opportunity and create an environment that empowers our people to thrive within our own shores. To this end, the Central Bank has developed a Policy Response Timeline to guide our crises management and the orderly reboot of the Nigerian economy. Immediate-Term Policies (0-3 Months) In light of the fact that this crisis is an exogenous one thrust upon us without much warning, this phase reflects the government’s efforts at containment and mitigation. Although global cases are heading towards two million with over 123, 600 deaths as of 14 April 2020, we now have 343 cases, of which 10 deaths and 91 recoveries have been recorded. With President Buhari’s continuing strong leadership, Nigeria can now test 1500 persons per day in twelve (12) Molecular Test Laboratories. We believe that this strong leadership in travel restrictions, lockdown, social distancing, and other measures have been greatly effective to curbing the spread of the disease. More so, the Presidential Task Force and Nigeria Centre for Disease Control (NCDC) have helped the country stay ahead of the curve with increased testing capacity, provision of betterequipped isolation centres, and effective contact tracing. Within this milieu, the CBN has responded in several ways, first by supporting hospitals and pharmaceutical industry with low interest loans to immediately deal with the public health crises; then by working with the private sector Coalition Against COVID (CACOVID) to support the Presidential Task Force across its response, while mobilizing palliatives for the poor and vulnerable. Under
this Immediate-Term Response, we have activated the following: 1) Ensuring financial system stability by granting regulatory forbearance to banks to restructure terms of facilities in affected sectors; 2) Triggering banks and other financial institutions to roll-out business continuity processes to ensure that banking services are delivered in a safe social-distance regime for all customers and bankers; 3) Granting additional moratorium of 1 year on CBN intervention facilities; 4) Reducing interest rates on intervention facilities from 9 percent to 5 percent; 5) Creation of N50 billion targeted credit facility for affected households & SMEs; 6) Strengthening the Loan-Deposit Ratio (LDR) policy, which is encouraging significant extra lending from banks; 7) Improving FX supply to the CBN by directing all oil companies (international and domestic) and all related companies (oil service) to sell FX to CBN and no longer to the NNPC; 8) Providing additional N100b intervention in healthcare loans to pharmaceutical companies, healthcare practitioners intending to expand/build capacity; 9) providing N1 trillion in loans to boost local manufacturing and production across critical sectors; and 10) Engendering financial inclusion by ensuring the poor and vulnerable are able, by all means necessary, through banks, microfinance, community and non-bank financial institutions, to access financial services to meet their basic needs. Short-Term Policy Priorities (0 - 12 months) As soon as President Muhammadu Buhari and the Health authorities determine our Coronavirus Transmission Curve is flattening and many of the ongoing restrictions are eased, this will be the phase for repositioning the Nigerian economic space. As part of the lessons from the current pandemic, we must ensure that that our value-added sector, the manufacturing industry is strengthened. www.businessday.ng
Accordingly, the CBN will pursue the following policies in this phase: 1) Reinvigorate our financial support for the manufacturing sector by expanding the intervention all through its value-chain. In most cases, we will ensure that primary products sourced locally provide essential raw material for the manufacturing sector except where they are only available overseas; 2) With the support of the Federal Government, the CBN will embark on a project to get banks and private equity firms to finance homegrown and sustainable healthcare services that will help to reverse medical tourism out of Nigeria. By offering long-term financing for the entire healthcare value-chain (including medicine, pharmaceuticals, and critical care), banks will work with healthcare providers to consolidate on the current efforts to rebuild our medical facilities in order to ensure Nigeria has world class affordable hospitals for the people of Nigeria and those wishing to visit Nigeria for treatment; 3) The CBN will promote the establishment of InfraCo PLC, a world class infrastructure development vehicle, wholly focused on Nigeria, with combined debt and equity take-off capital of N15 trillion, and managed by an independent infrastructure fund
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I believe we must now envision and work toward a Nigeria with the cutting edge medical facilities to provide world class care to the sick and vulnerable...
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manager. This fund will be utilized to support the Federal Government in building the transport infrastructure required to move agriculture products to processors, raw materials to factories, and finished goods to markets, as envisaged at the CBN Going for Growth Roundtable in March 2020; and 4) Continue to prioritize the provision of FX for the importation of machinery and critical raw materials needed to drive a self-sufficient Nigerian economy. Medium-Term Policy Priorities (0 -3 Years): Once the world returns to some new normal having tamed COVID-19 by a combination of vaccines and social distancing, and the Nigerian economy reopens fully for business, we will act quickly to enable faster recovery of the economy by targeted measures towards particular sectors that are able to support mass employment and wealth creation in the country. We will do so by focusing on four main areas, namely, light manufacturing, affordable housing, renewable energy, and cutting-edge research. In manufacturing, for example, it is pertinent to note that Nigeria’s gross fixed capital formation is currently estimated at N24.55 trillion made up residential and non-residential properties, machinery and equipment, transport equipment, land improvement, research and development, and breeding stocks. Of this estimated value, machinery and equipment, which are the main inputs into economic production, are currently valued at only N2.61 trillion. In order to pursue a substantial economic renewal, including replacement of at least 25 percent of the existing machinery and equipment for enhanced local production, we estimate at least N662 billion worth of investments to acquire hi-tech machinery and equipment. Therefore, the CBN will consider an initial intervention of N500 billion over the medium term, specifically targeted at manufacturing firms to procure state-of-the-art machinery and equipment and @Businessdayng
automated manufacturing models that would fast-track local production and economic rejuvenation, as well as support increased patronage of locally processed products such as cement, steel, iron rods, and doors, amongst several other products. The recent private sector investments in cement production using enhanced technology and automated manufacturing models is a good example of the kind of economic renewal we will be pursuing in this phase. We will develop a thorough screening process and stringent criteria for equipment types that would qualify for funding under this phase. In order to boost job creation, household incomes and economic growth, we will be focusing our attention to bridging the housing deficit in the country, by facilitating government intervention in three critical areas: housing development, mortgage finance, and institutional capacity. We will pursue the creation of a fund that will target housing construction for developers that provide evidence of profiled offtakers with financial capacity to repay. The current identification framework in the banking sector using the bank verification number (BVN) will be used to verify the information provided by the off-takers before the developer can access the funds. We will also be considering ways to assist the Mortgage Finance Sub-sector as well as build capacity at the State levels for their land administration agencies to process and issue land titles promptly, implement investment friendly foreclosure laws and reduce the cost of land documentation, as this has remained a major inhibiting factor in the provision of affordable housing in the country. Over the next 3 years, we will also support the financing of environmentally friendly energy production, as this has a tangential long-term health benefits. We will look at efforts to drive innovation and research in every sector, through our universities, research institutions, creative industry initiatives, and all other media of novelty and inventions. In conclusion, I believe we must now envision and work toward a Nigeria with the cutting edge medical facilities to provide world class care to the sick and vulnerable; enable our universities and research institutions to provide the requisite education and training that is required to keep these ecosystems functioning sustainably and efficiently; and millions of Nigerians employed in meaningful and wellpaying jobs. This is the Nigeria that we must aspire to build. COVID-19 may have plunged us into a crisis of unprecedented proportions. But, as Winston Churchill once admonished, we must never let a crisis go to waste. *Godwin I. Emefiele, CON is Governor of the Central Bank of Nigeria
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CBN scraps business plan as loan requirement for N50bn Covid-19 fund Onyinye Nwachukwu, Abuja
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he Central Bank of Nig e r ia ( C BN ) ha s scrapped the submission of business plan as a compulsory requirement to apply for its N50bn loan facility set up to ameliorate impact of coronavirus on businesses and households. Abubakar Abdullahi Kure, managing director, NIRSAL Microfinance Bank (NMFB), announced the development in Abuja follow ing re cent co n cern s that the bank was charging application fees on the loan. The CBN, last month set up the N50bn facility to be disbursed at single digits through the NIRSAL Microfinance Bank for households and small- and mediumsized enterprises (SMEs) that would be particularly hard hit by Covid-19, including hoteliers, airline service providers, health care merchants, among others. Already 80,000 applications have been received and according to Kure, NIRSAL MFB, will in coming week commence disbursement to qualified, genuine
applicants. He said of the total applications received, 40,000 c a m e f ro m h o u s e h o l d s while 30,000 came from Micro, Small and Medium scale enterprises. He encouraged people that have genuine requests to apply but warned those who think the money is just a grant to “stay away.” Explaining the new decision at a news conference, Kure said they initially observed that loan applicants were submitting highly substandard business plans and that to ensure high standard and efficient processing, NMFB engaged a third-party service provider to enable an optional, automated business plan at a highly discounted fee. This, he said was to avoid applicants being charged excessively by other consultants and also to assist applicants during the stay at home period and make application process easy, a situation which generated so much push-back. But he said in order “to stem further controversy, the management of NMFB has resolved that the business plan is no longer a
mandatory requirement and the third party provision of a business plan is no longer compulsory.” He said the reason for scrapping this requirement is to simplify the process, ensure speedy disbursements so that the intervention does not lose its essence through additional costs. Restating C BN ’s earlier clarification that no charges or fees are being collected from applicants, Kure rather stressed that though business plan has been scrapped, including it will make the loan processing a lot easier. He assured that the NMFB would adhere to the guidelines as laid down by the CBN and called for applications from credible businesses and households to mitigate the effects of Covid-19, but would consequently continue to accept the business plans people submit independently. He said what they would now rely on in appraising loan requests is global standing instruction - a platform that allows the NMFB access a beneficiary’s cash flow and deposits in his bank accounts.
Lagos discharges 8 more Covid-19 patients records 6th death Joshua Bassey
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agos State is continuing to record successes in the treatment and management of positive cases of the Covid-19 pandemic as more patients are daily recovering and leaving hospitals. Eight more patients were discharged yesterday, bringing the total recoveries in Lagos to 69 since the index case in February this year. The state governor, Babajide Sanwo-Olu, who disclosed this via his twitter handle on Tuesday, described it as “great news.” He said, “More great news today from our Mainland
Infectious Disease Hospital, Yaba. Eight more people; 2 females and 6 males have tested negative and fully recovered from #COVID19. They have been discharged to return to their families. This brings the number of patients successfully managed and discharged from our facilities to 69. “Please, let us continue to adhere to all the safety advice from our health experts.” However, the state government confirmed another Covid-19 death, bringing the deaths in the state to six since the outbreak of the disease. The state commissioner for health, Akin Abayomi, who gave the update via twitter on Tuesday, said the deceased
was a 56-year-old Nigerian, who recently returned from United States. The dead was said to be receiving treatment at government-owned facility at Yaba. “A 56-year-old Nigerian; male, who recently returned from the United States, has died of COVID19 related complication. “This brings the total number of COVID-19 related deaths in Lagos to six. Also, 13 new cases of COVID-19 infection confirmed. Total number of confirmed cases in Lagos are now 192. “Six additional fully recovered COVID19 patients; five males and one female were discharged,” said Abayomi.
Nigeria now has 12 laboratories to test for Covid-19 - NCDC Godsgift Onyedinefu, Abuja
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igeria Centre for Disease Control (NCDC) on Tuesday said Nigeria now had 12 molecular laboratories with the capacity to test for Covid-19 (Coronavirus) across the country, which is an increase from four laboratories since the country recorded its first case of
the virus in February. The states, which currently have the capacity to test for Coronavirus include; Lagos, Edo, Oyo, Ebonyi, Sokoto, Kano and Plateau. Chikwe Ihekweazu, directorgeneral, NCDC, who made this known during the daily briefing of the Presidential Task Force (PTF) on Covid-19, said the activation of more laboratories
would bring testing closer to the people. He said the challenge to be addressed now was collecting samples for testing. Ihekweazu also informed that the centre has traced a total of 9,000 cases of Coronavirus so far. Osagie Ehanire, minister of health, initially said in March that government was working to activate a total of 13 laboratories.
Sosoliso Airline chairman dies in London from COVID-19 IFEOMA OKEKE
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hairman of the defunct Sosoliso Airline, Victor Ikwuemesi, died on Tuesday in London, few days after he was diagnosed for coronavirus
pandemic. A source close to the family stated that the deceased went into hospital on Saturday, April 11, 2020, for being sick and was tested for COVID-19 and result came out positive on Tuesday www.businessday.ng
morning. “He was in ICU on oxygen but when the oxygen was removed for him to eat he couldn’t breathe on his own. So, they put him on a ventilator and he died shortly after,” the source disclosed. https://www.facebook.com/businessdayng
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Nigeria develops standards, codes for African fermented condiments Hope Moses-Ashike
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anufacturers of African fermented condiments have been enjoined to take optimum advantage of the development of standards and codes of practice for the products to promote greater competitiveness, locally and for export. Osita Aboloma, directorgeneral, Standards Organisation of Nigeria (SON), made the call at the opening of a technical committee meeting on Culinary Herbs, Spices, Seasonings, Tea and Flavourings held at the SON Training Centre, Ogba, Lagos, recently. Represented by the director, planning, research and statistics, Yahaya Nuhu Fana, the SON chief executive stated that the standardisation of the
processes of production and quality of African Fermented Condiments was a necessary component to satisfy consumers and boost patronage of the products locally and internationally. Africa is highly endowed with many fermented food condiments with available literature review identifying nine different products in Nigeria alone, Aboloma stated. He alluded to the fact that production dynamics and methods employed in the manufacture of these fermented condiments differ from one region to another. According to Aboloma, the microbial interplay during production and the nutritional qualities in the condiments however appear to be the same. The SON chief executive stated that the condiments in addition to their flavouring properties hitherto used to
serve as source of plant protein particularly to rural dwellers. He stressed that the associated nutritional benefits of its consumption has captured the attention of urban dwellers and highly placed people. “Standards form the backbone of Quality Assurance that facilitates trading hinged on specifications, adherence to common testing regimes, use of common language, provision of specified level of quality and following international best practices,” he said. He further described the Nigerian Industrial Standard (NIS) as a precise and authoritative document that prescribes rules, guidelines or characteristics for activities or for their results, aimed at the achievement of optimum degree of order for a product or service. He challenged manufacturers of African Fermented
Condiments to ensure compliance to minimum quality requirements and safety of these products as highlighted in the standard when finally approved by the Standards Council. He enjoined the Technical Committee members to bring their rich knowledge and experiences to bear in the deliberations. He stated that the approved standard and code of practice will be presented to the African Organisation for Standardisation (ARSO) for consideration and adoption as continental specifications for wider application. Chairman of the technical committee, Adeniyi Ogunjobi, a professor at the University of Ibadan, stated that Nigeria was leading the way for the rest of the African continent to follow, as there were no records of standards for these set of condiments.
Seyi Makinde (sitting) , Oyo State governor and others during the flag-off of Oyo State Drive Through and Walk Through Covid-19 Community Testing Centre at Lekan Salami Sports complex, Adamasigba, Ibadan.
Matured OMO, NT-bills worth CACOVID: Nigeria’s private sector response to COVID-19 N253.5bn to hit financial market Gbemi Faminu
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arch 26, 2020, it was announced that the Central Bank of Nigeria (CBN), through the Bankers’ Committee and the private sector had come together to form the Private Sector Coalition Against COVID-19 (CACOVID). The coalition was formed due to the urgent need to combat the unfolding and rising cases of COVID-19 in Nigeria. Other objectives of the coalition are to mobilise private sector thought leadership and resources, increase general public awareness, provide fully equipped healthcare facilities to respond to the crisis as well as support government initiatives. This initiative has been roundly successful, as surprisingly, various institutions have donated resources supporting the common goal of ensuring we all “stay alive together”. The coalition has reportedly amassed over N21 billion in donations, and there remains
optimism that this figure will increase in the coming days. With over 20-member organisations, and counting, curious minds want to know how the Coalition came about? According to reports, CACOVID was the brainchild of Aliko Dangote, chairman of Dangote Industries Limited, and Herbert Wigwe, group managing director, Access Bank plc. Following reports of the earliest COVID-19 cases in Nigeria, Dangote and Wigwe partnered several other concerned citizens, private sector institutions and the committee of banks who made independent donations of N1billion each. These individuals and businesses sought to support the Federal Government’s ongoing efforts to tackle the coronavirus menace as it steadily spreads across the country. These donations served as a jolt to other concerned citizens and corporate organisations, convincing them of the need to join the fight against the COVID-19 pandemic. www.businessday.ng
Hope Moses-Ashike
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igerian financial market will this week be awash with liquidity to the tune of N253.5billionfrommaturingOpen Market Operation (OMO) and the Nigerian Treasury bills (NT-bills). A breakdown of the inflows as seen in a note from Afrinvest Securities Limited shows that N195 billion would be maturing fromOMObillswhileN58.5billion would come from NT-bills. However, the CBN is expected to rollover the matured NT-bill at the Primary Market Auction (PMA) on Wednesday. “Our advice is for local qualified investors to take advantage of available corporate offerings DangoteCementbondwitheffective yield range of 12.25% -12.50% and available Commercial Paper offerings expected during the week. On NT-Bills, mid-term bills that advanced last week can be cherry-picked by local investors,” analysts at Afrinvest said. At the OMO market last week, the CBN mopped up a total of N39.4 billion from the financial system liquidity that
stood at N507.0 billion. The stop rates remained unchanged at 12.79 percent as investor demand continued to wane with no interest on short- and medium-term offerings. The report indicated that there was a slowdown in the Nigerian Treasury Bills secondary market activities in the four trading sessions last week, with local investors more on the sidelines but mostly taking interest in long-term instruments and higher yielding corporate offers. Consequently, average yield across all tenors closed flat with a slightly bearish bias up 9bps W-o-W due to sell-offs by some investors to take advantage of the relatively better offers. Precisely, average yield across the mid-term bills gained 0.6% W-o-W while at the long end of thecurve,yieldsshed0.3%W-o-W on slight demand. The short-term bills however closed flat due to only trickles of trades at this end by retail clients. In more detail, the most declining bills were 11Feb-2020(-1.3%)and28-Jan-2020 (-0.6%) while yields on 01-Oct2020 (+1.6%) and 17-Sep-2020 (+1.2%) advanced the most.
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How educators can help stem the tide of cyber bullying Akin Banuso
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t is perhaps one of the great paradoxes of our time – the opportunities that technology presents come with complexities that can be difficult to navigate. Nowhere is this more evident than in today’s classrooms. While technology is helping transform the learning experience in profound ways, it can also leave students exposed to significant online risk if the right measures aren’t in place. A recent survey on online bullying in the Middle East and North Africa revealed the depth of the challenge educators and parents face, highlighting that at least 85 percent of UAE children have been bullied online. In Nigeria, the government has addressed this plight through the provision for an Act that protects people from cyber bullying. However, there is much that still needs to be done in curbing cyber bullying by providing effective means of prosecuting cases in this regard and by raising awareness of the Cybercrimes Act in order to encourage victims of to report the offenders. As a means of dealing with a wide variety of technology-based threats, the National Assembly enacted an Act called The Cybercrimes (Prohibition, Prevention, etc.) Act 2015 Cybercrimes (Cybercrimes Act) with the purpose of providing an effective and unified legal, regulatory and institutional framework for the prohibition, prevention, detection, prosecution and punishment of cybercrimes in Nigeria. It’s worth noting there two specific forms of cyber bullying have been criminalised – cyberstalking and racial and homophobic offenses. Vast research has showed that children lack the necessary supervision required to effectively safeguard them from becoming victims of any form of cyber bullying. While parents have a role to play in limiting and supervising access to the internet, educators can also make a key difference. The more teachers are equipped themselves to deal with cyber bullying, the better the chance we have of combatting the online threat. In fact, there are several powerful ways we as adults can intervene in the cycle of online bullying. Helping to prevent cyber bullying begins with listening to children. Ask them to talk about their lives. Sit with younger children while they play and explore online. It’s a good idea to regularly ask tweens and teens to show you around the websites they visit, where they hang out, who with, and how they talk to each other. This is particularly important in a school setting, where online activities should be closely monitored so that appropriate online behaviour can be encouraged. There are also ways of watching out for signs of online cruelty. This typically involves taking note when children get upset while online or texting, or when they have a reluctance to be at school. At the same time, teachers can keep an eye out for children being mean to others online. Greater awareness around the consequences of bullying can assist in discouraging a culture of cyber bullying. Help children understand that cyber bullying can get them into serious trouble. In some cases, this might even @Businessdayng
involve legal ramifications. At the same time, encourage them to think about the psychological effects cyber bullying might have on others. Its important children feel they can report cyber bullying to you. Microsoft’s recent Digital Civility Index reveals that while cyber bullying is frequently listed as one of the most painful online risks, just 56 percent of teens in Turkey and 46 percent in South Africa ask for help when dealing with an online threat. To counteract this, adults need to promise unconditional support. Part of this involves reassuring children that you won’t curtail phone, gaming, or computer privileges because of others’ behaviour. In the context of a classroom specifically, this would also involve providing students with an anonymous platform from which they can report cyber bullying. One of the most effective ways to prevent online bullying is social and emotional learning—the process through which we learn to build strong relationships and develop healthy boundaries and self-perceptions. Key to this is promoting empathy and kindness. Actively teach thoughtfulness. This can help students understand how small, thoughtful actions can make a huge difference in others’ lives. Educators can even advocate for empathy training at school or start a kindness campaign within their classrooms. This could be as simple as each student agreeing to do one kind thing a day, or it could have a much broader scope, such as developing a programme to challenge a culture of criticism with the school. Similar campaigns can be replicated at home or even in a broader neighbourhood. As a teacher, you can collaborate with other educators to create programmes that explicitly address social-emotional skills. In fact, collaborative learning platforms can enable students to work together respectfully and to negotiate as they co-create. For example, by having students learn how to accommodate the needs of others when creating worlds in Minecraft, teachers can find opportunities to develop deeper emotional literacy and introduce strategies to resolve challenges or understand perspectives. Like teachers, parents have a critical role in identifying and stopping cyber bullying. As a parent, you might be surprised how difficult it can be for a child to admit, even to you, that they are being bullied. To help them get past this, create an environment that allows them to feel safe to tell you the full story. From there, together, you can come up with a plan of action. Encourage your child not to retaliate and to rather ignore or block the bully. Save the online discussions as evidence just in case it escalates to threats of violence and the police need to be involved. Approach their teacher or school counsellor and find out what steps can be taken to prevent it from happening in the future. Reassure your child that they always have your support and shouldn’t feel ashamed. Get them involvedinactivitiesthatmakethem feel good so that they can move on and heal from the incident. At the end of the day, combatting online risks like cyber bullying begins with promoting digital civility and helping one another to be responsible digital citizens. Akin Banuso, country manager, Microsoft Nigeria
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cityfile Covid-19: Abia fumigates markets, public places Godfrey Ofurum, Aba
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bia government has begun a state-wide fumigation of major markets, state and local government secretariats, schools, stadia as well as public buildings and roads in major towns and cities. Speaking with newsmen in Umuahia, Solomon Ogunji, leader of the state committee on Covid-19 handling the fumigation, said that the exercise would further prevent the spread of the pandemic in Abia. Ogunji, who is the commissioner for environment, said that the exercise which commenced on Monday, April 13, would last for three days. According to him, the committee has deployed manual spraying cans as well as motorised machines and fire-fighting trucks for the exercise. Also, executive secretary, Abia State Primary Healthcare Development Agency, Chinagozi Adindu, said that 120 environmental health officers were trained for the exercise. Adindu said that the officers would specifically carry out the fumigation in schools and public places in the 17 local government areas. He described the
exercise as part of government’s proactive measures to forestall the spread of the virus in Abia. He advised the residents to comply with government’s directive and remain at home to avoid inhaling the hydrocarbon chemical that is harmful to health. Some of the manual fumigators were seen carrying out the exercise on Aba Road, Umuahia. Some residents, who spoke on the exercise, said it was necessary. Public affairs analysts, Ambrose Nwachukwu and Uche Nwosu, along with Obinna Ibe, chairman of the Correspondents Chapel, Abia council of the Nigeria Union of Journalists, said the fumigation would further help to contain the spread of the pandemic in the state. They said that embarking on the fumigation during the lockdown, when residents were already confined to their homes, was well-advised. The state government had announced that the lockdown, which commenced on April 1, would end on Friday, April 17, after it was relaxed for three days to enable residents to restock their foodstuffs and attend Easter church services.
Zulum distributes food, cash to IDPs
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overnor Babagana Zulum of Borno has distributed food items and cash to 11,000 Internally Displaced Persons (IDPs) in Magumeri local government area of the state. At the distribution of the items in Magumeri, capital of the local government area, on Monday, Zulum said it was to alleviate their hardship amid the Covid-19 lockdown. He said that about 6,000 women received N5,000, with wrapper materials each, while 5,000 men who were head of various households received a bag of rice and maize, as well as three litres of cooking oil each.
The governor urged residents to maintain personal hygiene, ensure social distancing and avoid unnecessary gatherings to curb the spread of COVID-19. Zulum, who warned the citizens against the dangers of the pandemic disease, urged them to take responsibility in the fight against the virus. “We are all aware of the enormous challenges Borno is already faced with. As a responsible government, we are doing everything possible to contain this virus from spreading in our state. “However, this can only be achieved with your cooperation,” Zulum said. www.businessday.ng
Commander Rapid Response Squad (RRS) DCP Olatunji Disu and some market leaders in Computer village, Ikeja checking violators of government stay at home order, during the enforcement in Lagos, on Monday.
Ayade approves N79m for community micro projects MIKE ABANG, Calabar
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overnor Ben Ayade of Cross River State has approved the release of N79 million for the implementation of 21 micro projects across some communities in the state as part of multi-sectoral interventions. Some of the communities are Atakpa, Calabar South; Ebuafen and Ayikang Iye in Bekwarra; Abijang and Agbokim Mgbabor in Etung and Okweriseng, Ashikpe, Betukwel and Bebuawhan in Obudu local government area. Commissioner for international development cooperation, Inyang Asi-
bong, while presenting cheques to the benefiting communities in Calabar, urged them to hasten the implementation of the projects. Asibong advised them to lay emphasis on standards and specifications with a view to meet global best practices and to further reduce poverty and unemployment in their domain. The projects are a counterpart based fund project between the World Bank and the Cross River State government. The World Bank assisted Community and Social Development Project (CSDP) is under the state Community and Social Development Agency (CSDA), which the Min-
istry of International Development Cooperation (MIDC) Coordinates. The micro projects include the renovation of classroom blocks with motorised borehole and improved toilets, equipped with ventilations within the communities. Also, the provision of 1.5KVA hybrid solar electricity and panoramic solar street lights, the construction and equipping of health post, and the construction of solar powered borehole as well as culverts across the nine communities. Also speaking at the event, the acting manager of CSDA, Fidel Udie, explained that the micro projects were identified by the communities as
necessary interventions to alleviate poverty in the areas. He said the project would directly pull the State and Federal Government closer to achieving the Sustainable Development Goals (SDGs) and called for the judicious use of the funds to meet the set objectives. Some of the community leaders expressed their gratitude to Governor Ayade for the quick interventions during the lockdown and promised to take full ownership of the projects for overall sustainable development. They also said that the projects would reduce poverty and create employment for the people of the state.
‘Low risk’ prisoners to breathe air of freedom in Ekiti, Kwara
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kiti State is releasing “low risk” inmates of Ado Ekiti Correctional Centre as additional measure to curtail the spread of Covid-19 in the state. The attorney-general and commissioner for justice, Olawale Fapohunda, told newsmen on Monday that Governor Kayode Fayemi has directed the ministry of justice to immediately convene a meeting of the state’s Advisory Council on Prerogative of Mercy to that effect. “The governor is concerned about the possible impact of Covid-19 in the Ado Ekiti correctional centre. “He has, therefore, directed that additional measures be taken to decongest the facility,”
the attorney general said. He observed that persons in detention were particularly vulnerable to Covid-19 outbreak. “The step will not only help protect the inmates, but also the staff of the correctional centre, lawyers and others who provide support to the facility. “The ministry of justice will compile a list of identified prisoners for the consideration of the meeting of the advisory council on prerogative of mercy slated for Wednesday, April 15, 2020. “We will focus on prisoners on pre-trial detention for minor or low risk offences,” he said. Fapohunda added the
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ministry would collaborate with the Nigerian Bar Association, National Human Rights Commission, Legal Aid Council as well as civil society organisations to working on the inmates’ rights in the exercise. He said that the approach to be adopted was to ensure that no deserving inmate was left behind. In a similar development, the Kwara State government is grant pardon to nursing mothers and aged persons among others in the four correctional centres in the state. Salman Jawondo, attorney-general and commissioner for justice, said in llorin that the inmates to be pardoned were those with @Businessdayng
minor offences. According to Jawondo, aged inmates in bad state of health as confirmed by a qualified medical practitioner and those who have nearly completed their jail terms would be let go. The commissioner said the gesture was in consonance with the Federal Government’s directive to states in the quest to prevent the spread of Covid-19 Jawondo, who did not specify the number to be freed, said the pardon would involve awaiting trial inmates and convicts. He further said that the exercise would be carried out in collaboration with the state ministry of justice, judiciary and religious leaders.
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South Africa’s central bank slashes rates to post-apartheid low
Reduction is second in under a month as country braces for an extended coronavirus lockdown Joseph Cotterill
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outh Africa’s central bank has slashed its benchmark rate to its lowest in the post-apartheid era as Africa’s most industrialised economy braced itself for a lengthened coronavirus lockdown. The South African Reserve Bank said in a surprise announcement on Tuesday that it had cut its main repo rate by a percentage point, to 4.25 per cent, less than a month after it unveiled an earlier cut of the same size. The South African rand slipped by more than 1 per cent to trade at a rate of 18.3 against the US dollar following the announcement. The bank’s emergency rate cut underlines the danger to South Africa’s economy after President Cyril Ramaphosa last week extended the national lockdown by a fortnight to the end of April. The economy is likely to contract by more than 6 per cent this year, the bank said, compared with its forecast for a 0.2 per cent fall made three weeks ago. A longer lockdown “will likely also increase job losses with further consequences for aggregate demand,” Lesetja Kganyago, governor of the central bank, said. The bank still expects inflation to remain well within its target range of 3 to 6 per cent. In recent weeks the central bank
Homeless people queue for a food handout in Johannesburg on Monday © Kim Ludbrook/EPA/Shutterstock
has launched purchases of undisclosed amounts of government bonds to unblock local money markets and announced relief measures on bank loans for businesses affected by the pandemic. There have been more than 2,200 confirmed coronavirus cases in South Africa. Public health officials have said the growth in cases has been lower than expected and
that the lockdown has bought the country time to prepare for a peak in infections. South Africa’s economy was already struggling before the country implemented the containment measures, following years of stagnant growth and with unemployment at close to 30 per cent. Moody’s downgraded the government’s credit rating to below
investment grade last month in response to a rapid rise in debt and a legacy of graft, completing South Africa’s long descent into junk status. The debt load has left the government with limited resources to stimulate the economy through the lockdown. Civil society groups have warned of a looming humanitarian crisis without more state support for the poorest.
Tito Mboweni, the finance minister, said on Tuesday that he was “leaving no stone unturned” in a search for international financing to aid South Africa’s pandemic response. The rand has lost more than a fifth of its value against the US dollar so far this year, part of the rout in emerging markets as investors retreat to safe havens.
Global economy to suffer worst blow since the 1930s, warns IMF Most countries’ economies set to be at least 5% smaller, even after recovery Chris Giles
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he coronavirus crisis will leave lasting scars on the global economy and most countries should expect their economies to be 5 per cent smaller than planned even after a sharp recovery in 2021, the IMF said on Tuesday. Forecasting that this year would be the worst global economic contraction since the Great Depression of the 1930s, Gita Gopinath, the fund’s chief economist, said the world outlook had “changed dramatically” since January with output losses that would “dwarf” the global financial crisis 12 years ago. “A partial recovery is projected for 2021, with above-trend growth rates, but the level of GDP will remain below the pre-virus trend, with considerable uncertainty about the strength of the rebound,” she said. The IMF expects advanced economies to contract by 6.1 per cent and emerging economies to shrink by 1 per cent this year, although positive growth is still expected in India and China. But even after the sharp rebound which the IMF forecasts for next year, output
A closed café in Vienna, Austria. Businesses around the world have shut their doors © Leonhard Foeger/Reuters
is still expected to be 5 per cent lower in 2021 than expected in the IMF’s forecasts from October last year for advanced economies. “This is a deep recession. It is a recession that involves solvency issues and unemployment going up substantially and these leave scars,” Ms Gopinath said. Emerging economies are forecast to perform better as a whole, but that is boosted significantly by China which is expected to have output in 2021 that is just 1.4 per cent lower than the IMF forecast six months ago. If extensive lockdowns have to be extended beyond the second quarter of the year and Covid-19 returns in a www.businessday.ng
milder outbreak in 2021, the overall economic hit would be twice as large, the IMF estimated. Although the lockdowns are generating large economic contractions across the world, Ms Gopinath said they were necessary to get the pandemic under control. “There is not trade-off between saving lives and saving livelihoods,” she said. The IMF’s economic forecasts for 2020 are not as pessimistic as many private sector forecasts. They assume that the lockdowns will result in an 8 per cent loss of working days which will be concentrated in the second quarter for most countries but in the first quarter for China. Even with these moderate assumptions, global economic performance will be hit hard, the IMF said. It forecast that world output would decline by 3 per cent in 2020, 6.3 percentage points down from the growth forecast of 3.3 per cent that the IMF expected as recently as late January. Coronavirus business update How is coronavirus taking its toll on markets, business, and our everyday lives and workplaces? Stay briefed with
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our coronavirus newsletter. Sign up here In 2009, the worst year of the financial crisis, global output dipped 0.1 per cent. The IMF considers any growth rate below 2.5 per cent to be a global recession because, 90 per cent of the time, global growth exceeds that rate. Given the large fall in output, unemployment is expected to rise sharply even though many countries have adopted job retention programmes to keep employees attached to their places of work. As a result, incomes per person are expected to fall in nine in 10 of the IMF’s 189 member countries. In the US, unemployment is expected to rise from 3.7 per cent in 2019 to 10.4 per cent this year and only dip to 9.1 per cent in 2021. There is likely to be a smaller rise in the eurozone from 7.6 per cent last year to 10.4 per cent this year and 8.9 per cent in 2021. Almost all other countries should plan for output next year to be about 5 per cent lower than thought likely in October 2019, the IMF said — a forecast that reflects significant bankruptcies and lay-offs. This growth performance will result in much weaker public finances as countries seek to @Businessdayng
limit the damage from Covid-19. The IMF praised the efforts countries have taken individually to mitigate the pain and provide insurance for companies at the sharp end of the crisis. It said countries were right to lock down their populations to limit the spread of the virus and forecast that those such as Sweden that have followed alternative and looser policies would face just as deep recessions. She added that the fiscal insurance provided by governments and extraordinary actions by central banks to keep financial markets functioning smoothly “will go a long way toward ensuring that the global economy regains its footing after the pandemic fades, workplaces and schools reopen, job creation picks up, and consumers return to public places”. But she warned that many emerging economies did not have the resources either to provide adequate health services for their populations or to limit the economic damage. With many confronting simultaneous health, economic and financial crises, they “will need help from advanced economy bilateral creditors and international financial institutions” over the months ahead, she said.
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UK economy faces 35% quarterly plunge if lockdown lasts Office for Budget Responsibility warns of impact if restrictions stay for three months Delphine Strauss
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he UK economy faces a 35 per cent plunge in output in the second quarter of 2020 if a lockdown to fight the spread of coronavirus remains in place for three months, the country’s fiscal watchdog has warned. The Office for Budget Responsibility said on Tuesday that in this scenario, government borrowing would rise by £218bn to £273bn in 2020-21, taking the deficit to 14 per cent of gross domestic product — the highest since the second world war and well above the financial crisis peak of 10 per cent. The downgrade to the OBR’s March forecast was largely due to a collapse in tax revenues, which would be 15 per cent, or £130bn, lower than the watchdog expected a month ago. Government spending would be £88bn higher than forecast in March — largely due to the measures taken to support household incomes — and at 52 per cent of GDP, also the highest since 1945. The OBR emphasised that these measures should help to limit the long-term damage to living standards and the public finances, stressing that “the costs of inaction would certainly have been higher”. “It’s clear this will have a very significant impact on our economy . . . It’s important to be honest about that,” chancellor Rishi Sunak said in response to the OBR’s
The OBR said the figures should be taken as a ‘reference scenario’ because it could not predict how long restrictions on economic activity would last © Getty Images
report. “It’s clear that we must defeat this virus as quickly as possible. That’s not a choice between health and economics.” The OBR said the figures should be taken as a “reference scenario”, not a forecast of what was most likely to happen, because it could not predict how long restrictions on economic activity would last. To calculate the hit to GDP, it estimated the share of output that would be lost in each industry, factoring in the share of key workers and those able to work from home: hardest hit are education, with output down 90 per cent, and ac-
commodation and food services, down 85 per cent. Its estimate of the quarter-onquarter fall in GDP is on a similar scale to the economic hit predicted by official statisticians in France, where comparable lockdown measures are in place. The OBR said it would be accompanied by a very fast rise in the unemployment rate, which could reach 10 per cent in little more than a month, despite extensive use of the government’s furlough scheme. It has assumed that about 30 per cent of UK employees would be covered by the fur-
lough scheme, at a cost to the exchequer of £42bn — far higher than the Treasury’s original estimate. Equivalent support for self-employed workers could cost the government about £10bn over three months. The OBR has assumed that the three-month lockdown would be followed by a further three months of partial restrictions, after which the economy would recover quickly with no lasting damage. “We hope the contraction is temporary. In this modelling we have not tried to estimate any longer-term scarring to the economy,”
said Robert Chote, the OBR’s chair. Paul Johnson, director of the Institute for Fiscal Studies, a thinktank, said: “Let’s hope they are right to be as optimistic as they are about the speed of recovery once lockdown is over.” Even on these relatively benign assumptions, GDP would still fall by 13 per cent on an annual basis in 2020 — much more than the annual falls seen around the ends of each world war or in the financial crisis, the OBR said. Public sector net debt would rise sharply to exceed 100 per cent of GDP in the short term, reflecting not only higher government borrowing, but also the Bank of England’s additional quantitative easing and its new cheap financing for banks. Debt would end the fiscal year at 95 per cent of GDP — compared with the 77 per cent the OBR had forecast just over a month ago. It would remain 10 per cent of GDP above the Budget forecast even in 2024-25. The OBR said each additional month of lockdown could add about £35bn to £45bn to borrowing in this fiscal year, with a somewhat smaller amount saved for each month less. The Resolution Foundation, a think-tank, said the OBR’s scenario, while grim, was far from the worst case — because it assumed “almost no scarring or lasting impact on the economy from this recession, which history shows is unlikely to be the case”.
JPMorgan braced for losses from ‘fairly severe’ recession Net income falls by 69% in first quarter as America’s biggest bank ramps up loan provisions Laura Noonan
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PMorgan Chase warned that the coronavirus crisis could take an even bigger toll on its business this year, after reporting a 69 per cent fall in first-quarter profits as it ramped up loan loss provisions to prepare for a “fairly severe recession”. America’s biggest bank reported net income of almost $2.9bn for the three months ended in March, down from about $9.2bn a year earlier. Earnings per share of 78 cents were far below the $1.76 predicted by analysts contributing to a Bloomberg poll. Loan loss provisions jumped almost $6.8bn to $8.3bn, their highest level since 2009 when the US economy was reeling from the global financial crisis. The bank’s chief executive Jamie Dimon said the extra provisions, which fell most heavily in the bank’s credit cards division, reflected “the likelihood of a fairly severe recession”. On a call with journalists, chief financial officer Jenn Piepszak warned that “given the current market environment . . . credit
reserves build could be meaningfully higher in aggregate over the next several quarters relative to what we took in the first quarter”. Both she and Mr Dimon stressed that the ultimate outcome depended on how well the government stimulus plans would work. JPMorgan is known as being one of the most conservative banks on Wall Street. Ms Piepszak said higher provisions were taken even though just 4 per cent of mortgage holders had missed payments so far, and late payments on www.businessday.ng
credit cards were up only slightly. Still, the scale of the provisions sets a grim tone for the other big US banks reporting later this week. JPMorgan also warned that it expected a $3.5bn fall in non interest revenue at its investment bank for the 2020 year overall, while net interest income across the bank is now expected to come in at $55.5bn for the full year — lower than the $57bn-plus figure JPMorgan flagged at its investor day on February 25. Other headwinds in the chal-
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lenging circumstances of low interest rates, rising unemployment and the suspension of swathes of the global economy included lower fees from asset and wealth management business and lower investment banking fees “on lower activity”. Mr Dimon — who said his career plans had not changed after life-saving heart surgery in March — stressed that the bank had “performed well in what was a very tough and unique operating environment”. He pointed to growth in deposits, where balances grew by 23 per cent year-on-year. Analysts largely agreed, including RBC analyst Gerard Cassidy who told clients: “Overall, JPM posted a decent underlying firstquarter results in the midst of unprecedented headwinds.” Saul Martinez, analyst at UBS, said the results showed “JPM’s strengths in that the company is able to take a sizeable reserve charge and still be profitable given its considerable pre-provision profit buffers. Not all banks may be able to do this.” Investment banking revenue @Businessdayng
fell 49 per cent year-on-year, to $886m, mostly because of $820m of writedowns on bridge loans. In an email to staff, investment bank boss Daniel Pinto stressed that JPMorgan’s bridge loan book was a quarter of the size than it was going into the financial crisis. Markets revenues of $7.2bn were up 32 per cent — far higher than the “mid teens” rise Mr Pinto had indicated in late February — as “strong client activity” drove a 34 per cent rise in fixed income trading while a derivatives boom helped equities revenues to rise 28 per cent. Shares were around 2.8 per cent higher in early trading at $100.92, in line with a rise in the S&P 500 index. The outlook marks a complete turnround to a year ago, when Mr Dimon told analysts economic growth in the US “can go on for years. There’s no law that says it has to stop.” Just three months ago, JPMorgan reported its highest ever annual profit, making net income of $36.4bn as its consumer and investment banks then boosted profits even as interest rates fell.
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POLITICS & POLICY Lockdown extension: Did the President miss the momentum? ZEBULON AGOMUO
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efore the nationwide broadcast on Monday, April 13, 2020, by President Muhammadu Buhari in which he extended the stay-at-home order in Lagos, Ogun and the Federal Capital Territory (FCT), Abuja by additional 14 days, many Nigerians were not expecting to hear anything to the contrary. Their eyes were rather glued to the television screen to hear some clear-cut pronouncements on practical steps by government on how to ensure that palliative packages got to every Nigerian citizen, particularly, those resident in the affected areas. Before the Presidential broadcast, those who daily follow the chart on the rise in the cases of COVID-19 in Nigeria, already knew that there was no way Aso Rock was going to remove the embargo placed on movements. Truth be told, there is no indication that the country is out of the woods. If the country has only tested a paltry number of people, less than 10,000, from a huge population of over 200 million, you get close to 350 cases, with 10 deaths; it simply means that the surface is not even being scratched. Many infected Nigerians are, most probably, moving about distributing the disease, unchecked. Many Nigerians believe him, as he rightly pointed out, that “this (the extension of the lockdown) is a difficult decision to take, but I am convinced that this is the right decision. The evidence is clear. “The repercussions of any premature end to the lockdown action are unimaginable.
We must not lose the gains achieved thus far. We must not allow a rapid increase in community transmission. We must endure a little longer.” It is believed that having contained the cases that were traced to people that came in from foreign countries (index cases) and those who made direct contact with them, it is now time to trace community contacts. These are those, who may have come in contact with infected people without knowing. The thinking is that within the next two weeks, such people would begin to manifest the symptoms and probably report themselves to the appropriate centres. Although the President said what was expected of him, by telling Nigerians, particularly those resident in Lagos, Ogun and the FCT to still stay at home for the next 14 days in their own interest, he missed the momentum by not addressing the vexatious issues of biting hunger in the land and how the much-stated stimulus from the Federal Government could get to every Nigerian. An analyst, who x-rayed the speech, said: “He dodged the opportunities to inspire a populace that is falling in depression over failure of our governments to recognise the pangs of hunger that have formed a more dangerous virus, the hunger virus. “He frittered another chance to create hope and confidence of the people in their President. The President’s speech was full of no measures; half measures and tentativeness that suggested that we still needed weeks to plan for palliatives that Buhari announced during his first broadcast of 30 March 2020. How does he explain these? Does he care? Does he know, indeed, what Nigerians are going through.”
President Muhammadu Buhari
Recall that in the last two weeks, the stimulus or palliative packages rolled out by the Federal Government have been a subject of controversy. Not just that the masses repudiated the method of distribution, the leadership of the National Assembly also took exception to the bogus claim of those saddled with the responsibility of sharing, that huge amount of money had been distributed to a large number of unverifiable beneficiaries. Nigerians had cried out, using various means, especially the social media, telling the government at the centre, to use the house-to-house method used when politicians go out to campaign for votes; or use the ward method, or use the Bank Verification Number (BVN) to transfer money to them. These were issues on ground before the broadcast and Nigerians had expected the President to speak to those issues. But he never did.
Nigerians, who listened attentively, thinking that the President was going to address the alleged lopsidedness in the distribution and the “ethnicisation” of the palliative, were disappointed when they did not hear any of such. Observers say that the President’s refusal to address the welter of allegations swelling around the stimulus package may have inadvertently empowered those in charge to continue their alleged racketeering. The closest Buhari came to the palliative issue was when he noted that “no country can afford the full impact of a sustained restriction of movement on its economy. I am fully aware of the great difficulties experienced especially by those who earn a daily wage such as traders, day workers, artisans and manual workers.” “For this group, their sustenance depends on their ability to go out. Their livelihoods
depend on them mingling with others and about seeking work. But despite these realities we must not change the restrictions,” he further said. He also said that the palliatives would be sustained without talking about how they should be equitably distributed. He lost Nigerians when he said: “In the past two weeks, we announced palliative measures such as food distribution, cash transfers and loans repayment waivers to ease the pains of our restrictive policies during this difficult time. These palliatives will be sustained.” He also spoke about a register which many Nigerians have criticised and alleged to have been compiled along party line. He really appalled many when he said: “I have also directed that the current social register be expanded from 2.6 million households to 3.6 million households in the next two weeks. This means we will support an additional one million homes with our social investment programs. A technical committee is working on this and will submit a report to me by the end of this week.” Recall that the anger over the failure of the Federal Government to provide for the citizens unlike other nations that openly announced various packages for their people and the faulty method of distributing whatever was available, sparked all sorts of reports on the social media. Some commentators berated some of the philanthropists who donated huge sums of money into the coffers of the Federal Government towards the fight against the COVID-19; saying that they should have donated directly to the suffering masses instead. To worsen the situation, the Federal Government, through the Inspector-General of Po-
lice, decided to declare war against anyone who dares foment trouble while the lockdown lasts. But complaints are rife that many households are going through excruciating pain at the moment. Capturing the gloomy situation of things at the moment, Ikeddy Isiguzo, a media guru, in his article on ‘Coronavirus broadcast – Nigerians await President Buhari’s broadcast on hunger’, said: “Official statistics rate Nigeria as the poverty capital of the world.” According to him, “By noon on 14 April 2020, about 95.9 million Nigerians are living in extreme poverty, that is 47.6 percent of the population. Extreme poverty, also known as deep poverty, abject poverty, absolute poverty, destitution, or penury, according to the United Nations’ 1995 report of the World Summit for Social Development is characterised by severe deprivation of food, safe drinking water, sanitation facilities, health, shelter, education and information. Nigeria earned the unenviable title of the world’s poverty capital in June 2018 when the number of the extremely poor was 86.9 million. It has clung to the title ever since.” As it stands at the moment, some Nigerians are taking the same decision the four lepers at the gate of Samaria took as recorded in the scripture, in the search of food to satisfy their hunger: “If we go into the city we will die of starvation. If we surrender to the enemy they may kill us also. What do we have to lose?” This is where many Nigerians are at the moment: a pessimistic view of life. “Death is death— whether COVID-19 or hunger.” It appears, they are ready to die of the former than of the latter.
benefit and their palliatives will not be shared amongst politicians and their followers only. The party, however, called the attention of President Buhari, Governor Babajide Sanwo-olu and Ogun State Governor, Dapo Abiodun to another worrisome spate of security threat, which had resulted in citizens now finding it very hard to sleep at night. The party urged the governors to urgently deal the increasing rates of gang robberies, attacks and all forms of criminalities under the guise of lockdown, while also
urging the President to give the development a serious attention. “We noticed that President Buhari did not mention the rising cases of attacks against Nigerians during this lockdown, specifically in Lagos and Ogun State, while making his nationwide broadcast on Monday evening, it is a very serious matter, as many residents has been calling for help on social media, while many of the videos online are very disturbing, when these assailants invade their neighbourhoods,” the statement said.
Don’t neglect private sector in palliative, ADP tells Buhari ... Charges government to tackle security threats in Ogun, Lagos, others Iniobong Iwok
T
he Action Democratic Party (ADP) has called on the Federal Government of the All Progressives Congress (APC) under President Muhammadu Buhari not to neglect the private sector that has larger number of employees, in their palliatives as a result of the lockdown, to contain the rapidly spreading Coronavirus. This was contained in the reaction of the party to Monday’s live broadcast of
President Buhari on the need to extend the lockdown for another 14 days. According to the statement issued on Tuesday by Adelaja Adeoye, the national publicity secretary of the party, the party noted that it was commendable that the President has highlighted the efforts of the government so far; however that critical sector of the economy must not be forgotten in the provision of palliatives. “We must prepare not only to contain the Coronavirus, but also consider the effect of the lockdown on the emwww.businessday.ng
ployers of labour and their employees, who carry the largest workforce. “Some of them might resort to downsizing after the pandemic is over, because of how bad they may have been affected. To avoid massive job cut, the government at both Federal and state levels should work out some relief for these employers, in form of support,” Adelaja said. He stressed further that these employers have their tax records with the government, arguing that this is the time they needed government supports the most, as
there is a projection that the economy might plunder, which will affect many of them, especially the entrepreneurs and small scale businesses. ADP also noted that while it is appreciated that President Buhari has increased the social benefits from 2.6 million households to 3.6 million, which shows an addition of 1million households, there must be transparency and accountability in the process of making these funds available to the beneficiaries, so that the real vulnerable Nigerians will
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Wednesday 15 April 2020
BUSINESS DAY
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Wednesday 15 April 2020
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43
Live @ The STOCK Exchanges Prices for Securities Traded as of Tuesday 14 April 2020 Company
Market cap(nm)
Price (N)
Change
Trades
Volume
Company
Market cap(nm)
Price (N)
Change
Trades
Volume
PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 247,039.32 6.95 4.51 237 12,610,464 UNITED BANK FOR AFRICA PLC 215,456.35 6.30 1.61 316 35,645,268 ZENITH BANK PLC 455,249.16 14.50 3.57 846 35,589,583 1,399 83,845,315 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 172,297.41 4.80 2.13 557 51,818,963 557 51,818,963 1,956 135,664,278 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 1,994,742.28 98.00 3.16 219 2,419,959 219 2,419,959 219 2,419,959 BUILDING MATERIALS DANGOTE CEMENT PLC 2,061,901.40 121.00 3.42 276 1,445,572 LAFARGE AFRICA PLC. 199,736.66 12.40 -1.98 224 17,338,771 500 18,784,343 500 18,784,343 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 291,280.06 495.00 - 15 2,108 15 2,108 15 2,108 2,690 156,870,688 REAL ESTATE INVESTMENT TRUSTS (REITS) SFS REAL ESTATE INVESTMENT TRUST 1,386.00 69.30 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 0 0 UPDC REAL ESTATE INVESTMENT TRUST 8,405.05 3.15 - 2 21,150 2 21,150 2 21,150 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 2 21,150 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 52,512.75 55.05 - 19 41,853 OKOMU OIL PALM PLC. PRESCO PLC 36,450.00 36.45 - 6 9,257 25 51,110 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,500.00 4.25 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 2,100.00 0.70 - 15 234,610 15 234,610 40 285,720 DIVERSIFIED INDUSTRIES JOHN HOLT PLC. 217.92 0.56 - 0 0 1,903.99 2.93 - 0 0 S C O A NIG. PLC. TRANSNATIONAL CORPORATION OF NIGERIA PLC 27,234.15 0.67 -4.29 73 6,220,350 U A C N PLC. 20,457.21 7.10 0.71 44 1,240,124 117 7,460,474 117 7,460,474 BUILDING CONSTRUCTION ARBICO PLC. 423.23 2.85 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 29,700.00 22.50 -1.32 60 1,020,923 165.00 6.60 - 0 0 ROADS NIG PLC. 60 1,020,923 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,234.62 0.86 - 3 6,565 3 6,565 63 1,027,488 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 6,263.60 0.80 - 4 44,243 GOLDEN GUINEA BREW. PLC. 829.98 0.81 - 0 0 GUINNESS NIG PLC 49,721.69 22.70 - 29 201,634 INTERNATIONAL BREWERIES PLC. 134,310.34 5.00 - 53 2,276,899 NIGERIAN BREW. PLC. 195,124.41 24.40 9.91 8 410,756 94 2,933,532 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 140,400.00 11.70 9.35 124 2,632,869 FLOUR MILLS NIG. PLC. 88,158.16 21.50 - 29 182,650 HONEYWELL FLOUR MILL PLC 7,771.59 0.98 8.89 19 212,426 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 766.26 4.30 - 0 0 N NIG. FLOUR MILLS PLC. NASCON ALLIED INDUSTRIES PLC 22,520.23 8.50 - 20 240,717 UNION DICON SALT PLC. 2,993.06 10.95 - 0 0 192 3,268,662 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 13,147.41 7.00 1.45 58 665,643 NESTLE NIGERIA PLC. 658,063.22 830.20 - 155 90,418 213 756,061 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 5,316.09 4.25 - 15 67,728 15 67,728 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 15,881.91 4.00 -9.09 41 1,187,757 UNILEVER NIGERIA PLC. 60,322.56 10.50 - 58 511,997 99 1,699,754 613 8,725,737 BANKING ECOBANK TRANSNATIONAL INCORPORATED 88,995.32 4.85 4.30 90 1,307,342 FIDELITY BANK PLC 61,426.57 2.12 0.95 164 25,996,501 601,867.62 20.45 8.49 537 19,661,243 GUARANTY TRUST BANK PLC. JAIZ BANK PLC 15,026.77 0.51 8.51 17 2,660,396 STERLING BANK PLC. 43,761.44 1.52 9.35 74 5,538,562 UNION BANK NIG.PLC. 189,284.89 6.50 -1.52 17 246,112 UNITY BANK PLC 5,260.20 0.45 7.14 9 357,710 WEMA BANK PLC. 23,916.17 0.62 5.08 32 1,517,124 940 57,284,990 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 1 100,000 AIICO INSURANCE PLC. 9,517.37 0.84 - 5 24,400 AXAMANSARD INSURANCE PLC 16,590.00 1.58 - 3 3,000 CONSOLIDATED HALLMARK INSURANCE PLC 2,439.00 0.30 - 1 500 CORNERSTONE INSURANCE PLC 7,953.93 0.54 - 8 108,418 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 1,611.16 0.22 -4.35 6 420,000 LAW UNION AND ROCK INS. PLC. 4,210.40 0.98 - 0 0 LINKAGE ASSURANCE PLC 3,680.00 0.46 - 1 450 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 1 288,000 NEM INSURANCE PLC 10,561.01 2.00 -3.38 13 179,590 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,960.40 0.55 - 5 1,000,000 REGENCY ASSURANCE PLC 1,333.75 0.20 - 0 0 SOVEREIGN TRUST INSURANCE PLC 2,272.89 0.20 - 1 300,000 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 2,800.00 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 0 0 WAPIC INSURANCE PLC 6,477.75 0.27 3.85 16 590,900 61 3,015,258 MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,629.63 1.15 - 1 200 1 200
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MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 6,784.62 1.05 - 0 0 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,671.82 1.36 - 0 0 RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 6,900.00 3.45 1.16 73 2,058,202 CUSTODIAN INVESTMENT PLC 33,820.72 5.75 - 1 100 DEAP CAPITAL MANAGEMENT & TRUST PLC 495.00 0.33 - 0 0 FCMB GROUP PLC. 34,060.66 1.72 0.58 104 11,747,324 ROYAL EXCHANGE PLC. 1,029.07 0.20 - 0 0 299,391.57 28.50 9.62 25 332,812 STANBIC IBTC HOLDINGS PLC UNITED CAPITAL PLC 13,980.00 2.33 1.30 84 4,695,166 287 18,833,604 1,289 79,134,052 HEALTHCARE PROVIDERS EKOCORP PLC. 2,991.61 6.00 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 1,030.41 0.29 - 6 445,979 6 445,979 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 593.50 0.60 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 5,299.36 2.54 - 36 568,135 GLAXO SMITHKLINE CONSUMER NIG. PLC. 5,979.38 5.00 6.38 33 650,550 3,968.04 2.30 4.55 14 233,458 MAY & BAKER NIGERIA PLC. NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 949.58 0.50 -3.85 12 416,500 NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 95 1,868,643 101 2,314,622 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 710.40 0.20 - 2 300,000 2 300,000 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 911.95 0.31 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 216.00 2.00 - 0 0 287.07 0.58 - 2 1,000 TRIPPLE GEE AND COMPANY PLC. 2 1,000 PROCESSING SYSTEMS CHAMS PLC 1,080.09 0.23 9.52 2 222,000 E-TRANZACT INTERNATIONAL PLC 10,962.00 2.61 - 1 207 3 222,207 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,123,311.48 298.90 - 2 7 2 7 9 523,214 BUILDING MATERIALS BERGER PAINTS PLC 1,941.82 6.70 - 4 1,640 BUA CEMENT PLC 1,029,476.36 30.40 -1.30 38 809,454 16,240.00 23.20 - 16 239,375 CAP PLC MEYER PLC. 265.62 0.50 - 1 522 1,769.32 2.23 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC PREMIER PAINTS PLC. 1,156.20 9.40 - 0 0 59 1,050,991 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,192.12 2.03 - 0 0 2,324.95 1.32 4.76 29 790,923 CUTIX PLC. 29 790,923 PACKAGING/CONTAINERS BETA GLASS PLC. 34,998.04 70.00 - 0 0 GREIF NIGERIA PLC 388.02 9.10 - 0 0 0 0 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 88 1,841,914 CHEMICALS B.O.C. GASES PLC. 1,519.29 3.65 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 1 5,000 1 5,000 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 77.00 0.35 - 0 0 0 0 1 5,000 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 6 40,100 6 40,100 INTEGRATED OIL AND GAS SERVICES OANDO PLC 32,818.93 2.64 10.00 52 2,097,587 52 2,097,587 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 58,019.78 160.90 - 29 32,182 ARDOVA PLC 14,587.79 11.20 -0.44 36 565,431 CONOIL PLC 10,027.61 14.45 9.89 18 205,822 ETERNA PLC. 3,116.91 2.39 - 1 10,000 MRS OIL NIGERIA PLC. 4,206.05 13.80 - 5 1,439 TOTAL NIGERIA PLC. 32,695.95 96.30 - 20 11,248 109 826,122 167 2,963,809 ADVERTISING AFROMEDIA PLC 1,509.28 0.34 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 15,796.05 1.62 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 235.27 0.20 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,528.94 2.73 -5.86 32 1,060,220 TRANS-NATIONWIDE EXPRESS PLC. 421.96 0.90 - 0 0 32 1,060,220 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,259.15 2.75 - 0 0 IKEJA HOTEL PLC 2,058.01 0.99 - 9 40,006 TOURIST COMPANY OF NIGERIA PLC. 7,076.28 3.15 - 0 0 TRANSCORP HOTELS PLC 30,401.62 4.00 - 0 0 9 40,006 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 3,960.00 0.33 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 187.49 0.31 - 0 0 LEARN AFRICA PLC 694.31 0.90 - 5 75,200 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 427.10 0.99 - 9 231,000 14 306,200 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 580.20 0.35 - 2 350,000 2 350,000 SPECIALTY INTERLINKED TECHNOLOGIES PLC 688.80 2.91 - 0 0 SECURE ELECTRONIC TECHNOLOGY PLC 1,126.31 0.20 - 0 0
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INSIGHT
BUSINESS DAY Wednesday 15 April 2020 www.businessday.ng
Turning the Covid-19 tragedy into an opportunity for a new Nigeria GODWIN EMEFIELE
A
s many people are now aware, the outbreak of the Novel Coronavirus Disease (COVID-19) in China has rapidly permeated and profoundly changed the world. While this crisis is first and foremost a public health issue, which has claimed the lives of over 123,600 people worldwide, and counting, the economic damages are unprecedented on several fronts: crude oil prices have declined dramatically to as low as US$17 per barrel by the end of March, even before applying the discounts many oil exporters are offering; stock valuations for the NSE-ASI, Nikkei, Dow Jones and FTSE-100 have declined by an average of 23.8 percent between January and March 2020; global airlines have lost about US$252 billion in revenues and across the broad range of industries from hospitality to services, the pain is growing. These outcomes have expectedly thrown the global economy into a recession, the depth and duration of which is currently difficult to fathom. In fact, the International Monetary Fund (IMF) predicts that the global economy would decline by 3 percent this year. Around the world, countries have moved away from multilateralism and responded by fighting for themselves with several measures to protect their own people and economies, regardless of the spillover effects on the rest of the world. According to the World Customs Organization, a total of 32 countries and territories, adopted stringent and immediate export restrictions on critical medical supplies and drugs that were specifically meant to respond to COVID-19. As of 10 April 2020, an updated count of total export restrictions by the Global Trade Alert Team at the University of St. Gallen, Switzerland suggest a total of 102 restrictions by 75 countries. On 4 March 2020, Germany announced an export ban that applied to all sorts of medical protection gear including breathing masks, medical gloves and protective suits. Around the same time, President Macron announced that France will requisition all face masks produced in the country, a de facto export ban. Between 8 February 2020 and 6 April 2020, India released eight (8) different export notifications banning several drugs and medical supplies including hydroxychloroquine, ventilators, personal protections masks, oxygen therapy apparatus, and breathing devices. On 3 April 2020, the Trump Administration
Godwin Emefiele
invoked the war-era US Defense Production Act to stop major US mask manufacturer, 3M, from export of respirator masks, N95, to Canada and Latin America. Fears of a long global recession have also led to worries about unprecedented global food insecurity, with concerns that agricultural production may be dislocated by containment measures that constrain workers from planting, managing and harvesting critical crops. Rather than seek cooperative and global solutions, several countries have resorted to export restrictions of critical agricultural produce. According to the International Food Policy Research Institute (IFPRI), about 37 countries have enacted various forms of food export restrictions in response to COVID-19, even in countries where average production exceeds domestic consumption. For example, Viet Nam, the world’s third largest exporter of rice, suspended granting rice export certificates until the country “reviews domestic inventories”.
Russia, the world’s largest wheat exporter, announced a ten-day ban on the export of buckwheat and rice due to concerns over panic buying in local supermarkets. What if these restrictions become the new normal? What if the COVID-19 pandemic continues in a second wave or another pandemic occurs in which all borders are shut, and food imports are significantly restricted? What if we cannot seek medical care outside Nigeria and must rely on local hospitals and medical professionals? For how long shall we continue to rely on the world for anything and everything at every time? Although these developments are troubling, they present a clear opportunity to re-echo a persistent message the CBN has been sending for a long time, and at this time even more urgently so: we must look inwards as a nation and guarantee food security, high quality and affordable healthcare, and cutting-edge education for our people. For a country of over 200 million people, and projected to be
‘‘
We do not know what the world will look like after this pandemic. Countries may continue to look inwards and globalization as we know it today may be dead for a generation
about 450 million in a few decades, we can no longer ignore repeated warnings about the dangers that lie ahead if we do not begin to depend largely on what we produce locally, because the security and well-being of our nation is contingent on building a welldiversified and inclusive productive economy. When I became Governor of the Central Bank in June 2014, imports of rice, fish, wheat and sugar alone consumed about N1.3 trillion worth of foreign exchange from the Bank. The immediate question that came to my mind was: can we not grow these ourselves? After all, only a few decades ago, Nigeria was one of the world’s largest producers and exporters of palm oil, cocoa and groundnuts. Today, we import nearly 600,000 metric tonnes of palm oil, whilst Indonesia and Malaysia, two countries that were far behind us in this crop, now combine to export over 90 percent of global demand. In 2017, Indonesia earned US$12.6 billion from its oil and gas sector but US$18.4 billion in from palm oil. I believe that this pandemic and the immediate response of many of our trading partners suggest it is now more critical than ever that we take back control, not just control over our economy, but also of our destiny and our future. In line with the vision of President Muhammadu Buhari, the CBN has indeed created several lending programmes and provided hundreds of billions to smallholder farmers and industrial processors in several key agricultural produce. These policies are aimed at positioning Nigeria to become a selfsufficient food producer, creating millions of jobs, supplying key markets across the country and dampening the effects of exchange rate movements on local prices. This philosophy has been a consistent theme of the CBN’s policies over the last couple of years. At the 2016 Annual Bankers’ Dinner, I challenged the bankers that we needed to take decisive actions to fundamentally transform the structure of our economy. Throughout that speech, I talked about the damaging effects of Nigeria’s unsustainable propensity to import, and opined that it was high time we looked inwards and stopped using hard-earned foreign exchange (FX) to import items that we could produce locally. This determination, therefore, formed the bedrock of the Bank’s policy, which restricts access to FX for importers of many items. These sentiments were re-echoed at the 2017 edition of the same Bankers’
Dinner, with specific examples of several companies that have benefited significantly from this policy of self-sufficiency. With President Buhari’s full support, we have continued to refine this policy to ensure that the best interest of Nigeria is served. Many times, the Bank has been accused of promoting protectionist policies. My answer has always been that leaders are first and foremost accountable to their own citizens. And if the vagaries of international trade threaten their wellbeing, leaders have to react by compelling some change in patterns of trade to the greater good of their citizens. That is why in response to COVID-19, we are strengthening the Nigerian economy by providing a combined stimulus package of about N3.5 trillion in targeted measures to households, businesses, manufacturers and healthcare providers. These measures are deliberately designed to both support the Federal Government’s immediate fight against COVID-19, but also to build a more resilient, more self-reliant Nigerian economy. We do not know what the world will look like after this pandemic. Countries may continue to look inwards and globalization as we know it today may be dead for a generation. Therefore, as a nation, we cannot afford to continue relying on the world for our food, education and healthcare. The time has come to fully transform Nigeria into a modern, sophisticated and inclusive economy that is self-sufficient, rewards the hardworking, but protects the poor and vulnerable, and can compete internationally across a range of strategic sectors. In order to achieve this goal, we must begin immediately to support the Federal Government to: 1) Build a base of high quality infrastructure, including reliable power, that can engender industrial activity; 2) Support both smallholder and large scale agriculture production in select staple and cash crops; 3) Create an ecosystem of factories, storages, and logistics companies that move raw materials to factories and finished goods to markets; 4) Use our fiscal priorities to create a robust educational system that enables critical thinking and creativity, which would better prepare our children for the world of tomorrow; 5) Develop a healthcare system Continues on Page 31
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