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Nigeria pays higher interest rate on new $2.8bn borrowing Receives total bids of $9.25bn External debt hits $24.9bn after bond sale T N

Political pressure may have suppressed release of Nigeria’s unemployment data

... Analysts fear job data may have got worse ... NBS blames delay on lack of funds

LOLADE AKINMURELE

igeria, yesterday, successfully raised a new $2.86 billion Eurobond but at a higher interest rate, which would put further pressure on debt service to revenue ratios. The country currently

MICHEAL ANI

spends an average of N69 of every N100 revenue servicing debts. The higher interest rates

paid on the new debts could take it above 70 percent unless the government is able to signifi-

cantly boost revenue collection analysts said. Continues on page 34

he fear that a higher unemployment rate will have a negative impact on the fortunes of Nigeria’s ruling All Progressive party (APC) at the general elections early next year may be behind the delay in releasing the country’s unemployment data, sources tell BusinessDay. The National Bureau of Statistics (NBS) last released unemployment figures in the third quarter of 2017, and since then analysts and other users of such data have waited in vain for an update. NBS has blamed the delay on paucity of funds. “The delay in the release of Continues on page 34

Inside Firms Capex spend in Q3 still below pre-recession level P. 2 L-R: Ndubusi Kalu, former military governor, Lagos State; Bala Yesufu, celebrant/author “Export Architecture Roadmap,” his wife Anita; Olusegun Osoba, chairman of the occasion, and Yetunde Odejare, permanent secretary, office of the deputy governor, Lagos State, representing deputy governor, during a lecture and the book launch to celebrate Bala 60th birthday in Lagos, yesterday. Pic by Olawale Amoo

IJINLE: Osun launches initiative to revive P. 35 traditional Yoruba fashion

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Nigeria dials up mobile banking revolution Banking system of Africa’s largest market being opened to non-banking institutions like telecoms.

s Nigeria set to replicate the success of Kenya’s digital payments upheaval on an even grander scale? MTN, the top African telecom operator, certainly hopes so as it prepares to apply for a mobile banking licence under a new regime launched by Nigeria. By opening up access to Nigeria’s banking system to non-financial companies such as telecom operators, the central bank hopes to make basic financial services accessible to the tens of millions of people in the country who have no bank account. MTN, the South African telecom operator that is Nigeria’s biggest carrier with more than 50m subscribers in the country, is the group best positioned to capitalise on the opportunity, just as Kenya’s Safaricom did by launching Mpesa in 2007. Nigeria, though, seems determined to avoid a repeat of Mpesa’s monopoly by forcing telecom groups to work closely with banks. Rob Shuter, MTN’s chief executive, told a telecoms conference on Tuesday that the company plans to apply for a licence under the west African country’s new regime and

60m

Number of people in Nigeria— out of a 200m population — who do not have bank accounts aims to launch its Mobile Money service there in the second quarter of next year. Mazen Mroue, chief operating officer of MTN Nigeria, argued there was “big potential” to convert the carrier’s 50m Nigerian customers into mobile money users. “We’ve already laid the foundation so it becomes easier to extend these services,” he told the Financial Times at his office in Lagos. “This is an opportunity for all stakeholders to work together, and use existing telco infrastructure to assist all of the unbanked . . . we’re open for collaboration with any player that really wants to leverage our infrastructure.” Nigeria has plenty of catching up to do. Kenya’s Mpesa has signed up 23.4m users — some 80 per cent of the adult population — becoming the de facto technique for transferring money for many people in the east African country. Nigeria’s economy is five times the size of Kenya’s, underlining the scale of the opportunity. More than 60m of Nigeria’s roughly 200m people do not have bank accounts. MTN is in prime position to sign many of them up to a mobile payments service, not least because of vast agent network. There is barely a village or market across Nigeria’s 924,000 sq km, no matter how remote, without someone at a yellow MTN table selling phone credit. Banks find it uneconomical to serve lowincome customers who generate little revenue, said Karima Ola, who leads African deals at Leapfrog

Investments, a private equity fund focused on companies serving consumers earning $2-$10 a day. Such customers also have difficulty accessing banking facilities. “For some of these customers, you [join together] and give six to seven of your debit cards to a guy on a bicycle who rides three miles to the ATM — think of the risks involved there,” she said. “The solution is agency banking, where you have a local agent who can take money and [disburse money]. Who has the biggest number of agents in the country? It’s the telcos.” Banks cannot afford to put branches in every corner of the country — for logistical, economic and security reasons. But MTN has agents scattered throughout, for instance, in Borno State, which has borne the brunt of the Boko Haram insurgency. There are challenges to MTN’s position. Edward George, head of research at Ecobank, said: “MTN’s market share has been falling steadily for the last five years . . .[and] we’ve seen both Airtel and Glo gaining market share and growing strongly.” Airtel has developed a mobile banking service in its home market of India, while 9 Mobile, the company that rose from the ashes of the bankrupt Etisalat Nigeria, could use it as an opportunity to gain market share, said Mr George. Other groups that could benefit from the spread of mobile money include the Rocket Internet-backed ecommerce group Jumia and digital financial services providers such as Paylater, which provides microloans. “Our market is limited right now to the banked and there are more unbanked than there are banked in Nigeria,” Paylater’s chief executive Chijioke Dozie. “If more of the unbanked started going into these payment

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If more of the unbanked started going into these payment systems, or digitising their [savings] through mobile money wallets then we can definitely service them

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By Neil Munshi, FT

Rauf Aregbesola, governor, Osun State; Gboyega Oyetola, governor-elect, his wife Kafayat Oyetola; Wale Adeeyo, chairman, Federal Mortgage Bank of Nigeria, and beneficiaríes, at the launch of IJINLE.

Nigerians studying in the US rise to a 6-year high ... ASUU strike, poor funding encouraging exodus BUNMI BAILEY

aced with incessant strikes by the Academic Staff Union of Universities (ASUU), poor funding of education and inadequately equipped schools, Nigerian youths are increasingly running to the United States to get education. ASUU are currently on another of their annual strike actions aimed at forcing the government to increase funding for universities in the country. The Union embarked on an indefinite strike action since November 4 but more than a week after, the government is yet to call ASUU to the negotiating table. Students are already back home and praying that ASUU and the government start what has become a ‘strike, negotiation and suspension of strike’ annual ritual. In between this ritual, students suffer and some are not able to even return to school due to one misfortune or the other. Four year

annum according a report by US based student support organisation College Board. This means that the 12,693 student studying in the US are paying as much as US$325 million (N117 billion) per year as tuition fees. This is besides the feeding, accommodation and transportation costs. Students in Nigerian public universities pay less than N500,000 per annum as tuition fees. Some education analysts say this explains the poor funding for education in the country and hence the exodus by those who can afford higher quality education outside the shores of the country. Globally, Nigeria ranked 13th among the countries with the highest number of students in America, while China, India, South Korea, Saudi Arabia and Canada are the top five countries, according to the report. ASUU claims its current strike is to protest against alleged fed-

Continues on page 34

Firms Capex spend in Q3 still below pre-recession level BALA AUGIE

systems, or digitising their [savings] through mobile money wallets then we can definitely service them.” By waiting a decade longer than countries such as Kenya to embrace mobile banking, Nigeria has avoided some pitfalls, such as struggling to keep track of the money flowing through the telecom groups providing the new services, said Mr Dozie. “The [Nigerian] central bank has probably been cautious in terms of not trying to rush into the mobile money space given they want to ensure that they can monitor what goes on,” he said. “The telcos are not regulated by them, so they’ve tried to marry [financial institutions] and telcos [in order to] regulate them adequately because this will have a huge effect on the financial system.”

programmes in many universities tend to drag on for five to six calendar years due to this annual ‘strike’ ritual. But for a few privileged Nigerians that can afford it, the United States has become the preferred destination to get an education. The number of Nigerians studying in the United States rose last academic year has risen to a 6-year high in the 2017/2018 academic year. Nigerians in American tertiary institutions rose 8.4 percent to 12,693 in the 2017/18 academic year from 11,710 in the 2016/17 year, according to the 2018 Open Doors report released on November 13, 2018. It is highest number of Nigerian students in the USA since the 2013 session, BusinessDay analysis of the figures have shown. Nigerian students studying in the US has increased steadily from 7,316 in the 2012/2013 academic year to the current level. The increasing number of Nigerians in US universities is despite the fact that average tuition fees in the US for the 2017/2018 academic year is US$25,620 (N9.2 million) per

igerian companies that conserved cash during the downturn of 2016 are beginning to loosen their purse strings as evidenced in the improvement in capital expenditure (Capex) spending in Q3 2018, although it is still below 2015 levels. Corporate Nigeria has been reluctant to spend aggressively since the recession of 2016- brought on by a precipitous drop in crude oil prices, which stoked a severe dollar scarcity. However, the relative peace in the Niger Delta region combined with a rebound in crude oil price and production and the introduction of Investors and Exporters windows helped the country exit its first recession in the second quarter of 2017. That gave firms the leeway to source foreign exchange and import raw materials and equipment to

meet production and pursue expansion plans. The capital expenditure spending of 40 non-financial companies that have released third quarter 2018 results increased by 20.86 percent to N226.16 billion from N187.12 billion in the September 2017 period. This compares with a drop of 38.17 percent to N187.12 billion in the 2017 periodfromN304.52billionin2016and a decline of 41.27 percent to N304.52 billioninSeptember2016fromN522.68 billion as at September 2015. “They have been trying to expand by increasing their capacity to meet new demand following the economic slowdown of 2017 and 2016,” said Ayodeji Ebo, managing director/ CEO of Afrinvest Securities Ltd. The consumer goods, and energy firms drove much of the growth in capital expenditure. Oando Nigeria Plc, an oil and gas major, saw investment in property plant and equipment surge by 212.94

percent to N21.38 billion as at September 2018, while it revenue grew by 31.13 percent to N505.13 billion in the period under review. For the consumer goods firms, Guinness was more aggressive in using cash stock piles to fund infrastructure as investment in property plant and equipment surged by 876.10 percent to N4.07 billion as at September 2017. However Nigerian Breweries hasn’t been investing in capital expenditure as investment in property plant and equipment has been falling in the last five years. Julius Berger Nigeria Plc, the largest construction company by market capitalization saw investment in property plant and equipment surge by 814.80 percent to N1.56 billion as at September 2018; the last time the company acquired assets was in 2015.

•Continues online at www.businessdayonline.com

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Made-in-Nigeria helicopters to debut through partnership IFEOMA OKEKE

ational Agency for Science and Engineering Infrastructure (NASENI) is partnering the Nigerian Civil Aviation Authority (NCAA) to provide relevant guides in its plan to produce Made-inNigeria helicopters. Besides, the agency charged with the responsibility of fast-tracking home-initiated industrialisation, has placed an order for a Dynali H3 easy flyer sport ultra-light helicopter for the purpose of reverse engineering. Muhammed Sanni Haruna, executive vice-chairman/ CEO of NASENI, spoke in Lagos Wednesday during a courtesy visit to the NCAA headquarters where the Mukhtar Usman, director-general of NCAA, received him Haruna said in line with the agency’s mandate in Aviation and Aeronautics Technology, the agency reached out to potential partners and manufacturers of helicop-

ters. He said Dynali Helicopter Manufacturer was found to be a willing partner, adding that the Dynali Helicopter was selected because its technology was easier to copy, learn, domesticate and modify. “They are willing to build the capacity of our staff for maintenance, repair, assembly and manufacturing of helicopters in Nigeria,” he said. He assured that before the end of 2019, staff of the agency would have mastered the art of building the helicopters, adding that the agency had in the past produced unmanned aerial vehicle (drones). He said, “Research and Development is not one or two - day affair but we have facilities for reverse engineering. “In fact we have a centre which we call rapid prototyping centre. Any machine that you want to reproduce, we have facilities, advance manufacturing equipment for that matter on how to give us something fast but then

aviation is a high safety and security industry that certain things, we must wait for certification from here (NCAA) before we proceed further. “We are confident that through your support and that of other stakeholders, the made-in Nigeria Helicopter project will be a success.” In line with NASENl’s mandate in Aviation and Aeronautics technology, Ministerial and Presidential directives to the Agency to develop made-in-Nigeria helicopters, the agency reached out to potential partners and manufacturers of helicopters and eventually found Dynali Helicopter Manufacturing Company of Belgium as a willing partner to fast-track technology acquisition and domestication. The company is the manufacturer of a wide range and models of Dynali H3 easy flyer sport ultra-light helicopters. The company produces the simplest, easy to maintain and operate helicopters of high quality and of international standards.

Financial autonomy: Reps task Presidency to sign COREN amendment bill into law KEHINDE AKINTOLA, Abuja

ouse of Representatives has called on President Muhammadu Buhari to sign the Council for Regulation of Engineering in Nigeria (amendment) bill into law without further delay. Toby Okechukwu, chairman, House Committee on Works who gave the charge during an oversight function to COREN headquarters in Abuja, expressed optimism that the bill when signed into law would grant the Council the financial autonomy from overdependence on annual budgetary provisions. While giving breakdown of the Council’s budget performance, Kamila Maliki, COREN Registrar, disclosed that out of N648.5 million approved in the

2018 Appropriation Act, only N190.2 million had so far been released as of third quarter of 2018. Maliki said the Council, which generated the sum of N722.2 million, was currently in deficit of over N2 million having exhausted its internally generated revenue on recurrent and overhead within the period under review. He disclosed that the Council also remitted total of N30 million to the Federation Account, as provided by the extant law. The COREN Registrar, who applauded the delegation for the support enjoyed towards the passage of the amendment bill, informed members that the Council had desired to advance its regulatory roles with a view to attaining the membership of the International Engineering Alliance (IEA).

He described the organisation as the ‘global elite club’ of about 34 countries, including the United States, saying, “The Council was invited to the Alliance office in the US for talks and a proposal to visit COREN in Nigeria to see how we operate.” Speaking further, Okechukwu (PDP-Enugu) urged COREN management to galvanise professional efforts towards facilitating the signing into law of the COREN Establishment (amendment) bill recently passed by the National Assembly. He said the amendment if signed into law would ensure adequate autonomy and financial independence for the Council, as well as enable it expand its nets toward regulating activities of both local and expatriate engineers and workmen coming into Nigeria.

Edo partners LAPO to promote science, technology education IDRIS UMAR MOMOH, Benin

do State government says it is partnering Lift Above Poverty Organisation (LAPO) in providing the best educational opportunities to its school system and students. Christopher Adesotu, the state commissioner for science and technology, made the disclosure during the grand finale of the 2018 annual LAPO quiz competition for secondary schools in Edo and Delta states. Adesotu, represented by Ukpenbor Jonathan, director of science and technical development in the ministry,

noted that there was no place in the world where education was singularly funded by the government. He said the activities of LAPO had served as a springboard of success to many schools and students in Nigeria, particularly in Edo and Delta states. He commended the organisation for its famous educational value programme as well as social responsibilities that cut across the showcasing of intelligence through competitive intellectual contests and massive procurement of science equipment to schools and award of scholarship to the

deserving students. The commissioner, however, disclosed that the state government was willing to collaborate with professionals and non-governmental organisations to create jobs and wealth. While explaining that all the major stakeholders in the country have realised the important role of science, technology and innovation in driving rapid industrialisation and sustainable development, he opined that the country could still be salvage and repositioned for leadership roles in science, technology and innovation in Africa and the world.

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A global first for humanitarian action: Nigeria’s businesses partner with the United Nations to support the north-east EDWARD KALLON Kallon is United Nation’s Resident Coordinator and Humanitarian Coordinator in Nigeria. Kallon is also the Resident Representative of the United Nations Development Programme in Nigeria (UNDP).

n Thursday 15th N o v e m b e r, t h e U n i t e d Nat i o n s and Nigeria’s business leaders will partner up to support millions of people in north-east Nigeria whose lives have been hampered by violence and insecurity. A handful of companies will be the first to write a new chapter in the history of the Nigeria Humanitarian Fund by joining the Private Sector Initiative. The Nigeria Humanitarian Fund-Private Sector Initiative is a simple, powerful funding mechanism to pool donations and resources to create a more effective response to humanitarian crises. Up until now, governments were the only donors to the Fund. The initiative is timely and much needed. In October I visited the town

of Bama in Borno State, where over 23,000 people - mostly women and children -have fled violence and now live in a crowded and dusty camp. One thousand more people arrived in the camp in October alone. Civilians in the worst-affected states of Adamawa, Borno, and Yobe continue to bear the brunt of a conflict that has led to widespread forced displacement, human rights violations, and loss of livelihoods and income. It has also led to despair and loss of hope. One of the people I met in Bama was Halima. She is a mother of six young children from a remote community in Borno State that was attacked in 2016 by non-state armed groups, causing her to flee for her and her family’s lives. In the chaos, she was separated from her husband and children. When I met her, they had all just been reunited. It was extraordinarily moving to hear Halima speak of the joy of seeing her family once again. The experience of displacement and terror that Halima and her family underwent, mirror that of millions of displaced vulnerable and innocent civilians across north-east Nigeria.

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The initiative that the UN and Nigeria’s business leaders will launch on Thursday is a new way for commercial entities and entrepreneurs to become directly involved in the humanitarian response to the crisis.By tapping into this strong and vibrant private sector we can collectively provide more aid to more people

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Most of them continue to rely on humanitarian assistance – like food, clean water medicine and safe water - to survive.Since the beginning of 2018, about 200,000 people have arrived in the nearly 270 camps in the northeastern

states. The crisis has left more than 7 million people in need of emergency assistance to survive and stay safe. The needs are great and the situation dire, but much can and is being done, by the Government of Nigeria, the United Nations and other international and Nigerian humanitarian organisations. Over 3,000 aid workers, the vast majority of whom are Nigerians, are working daily to support those most in need. Private sector companies and investors have a pivotal role to play in responding to the humanitarian crisis – and many are already actively helping and supporting their fellow Nigerians. While Nigeria is hit by one of the world’s worst humanitarian crises, it is Africa’s biggest economy and home to one of Africa’s most vibrant private sectors. The initiative that the UN and Nigeria’s business leaders will launch on Thursday is a new way for commercial entities and entrepreneurs to become directly involved in the humanitarian response to the crisis. By tapping into this strong and vibrant private sector we can collectively provide more aid to more people. The Nigeria Humanitarian Fund-Private Sector Initiative

(NHF PSI) presents a unique opportunity to create a blueprint for future private sector engagement in humanitarian action across the globe, and to use a United Nations fund that is measurable, accountable and effective. Since its inception in May 2017, the Fund has allocated close to US $70 million in humanitarian assistance, supporting the response to the cholera outbreak this year and providing aid to hundreds of children with malnutrition. The NHF PSI opens a pathway to participate in the process of not only meeting the immediate needs of hundreds and thousands of families affected, but also in their recovery process. Companies that take part can help invest in not only saving but also rebuilding the lives of Halima and the millions of others whose lives have been torn asunder by violence. This investment provides a beacon of hope for a brighter future. This is business for good. hastag InvestInHumanity (hastag)NigeriaHumanitarianFund

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Efficiency in Nigeria transportation sector and its economic factors FESTUS OKOTIE Okotie, a maritime transport specialist, wrote via fokotie.bernardhall@gmail.com

igeria is undoubtedly a highly populated country with an estimated population of above 170million people. The population is also highly diverse and this gives our nation the advantage of a highly diversified economy. The glorious days of oil boom of 1973 is part of the factors that pushed the economy of our nation to the roof, which also affected our transport system a great deal. This was responsible for infrastructural demand and improvement in the transportation sector. However the Journey so far has indicated clearly that there has not been a balance in our nation’s transportation system especially because of the various economic leakages within our transportation system and the inadequate investment in

modern technology and human resources to drive our transportation system to its full potential. The focus of this article is to highlight some benefits of using Customized Enterprise Resources Planning software to block some of the financial leakages in our nations transport system, review of its existing policies, agreements and attracting more investors to this sector. The new strategy of improving on the railway sector across the nation by this current government calls for commendation. Some of the points highlighted in this article are as follows: 1. Deploying a customized Enterprise Resource Planning Solution to integrate all the various agencies in the maritime sector (e.g. NPA, Shippers Council, NIMASA, NIWA etc) to share strategic data that relates to cargo throughput, vessel traffic, berth occupancy, container traffic, truck traffic, cargo shed occupancy, fees & dues collections, staffing, license registrations, license issuance and redundancies in the system.A well organised, coordinated and efficient deployment of this enterprise platform will enhance data integrity, identify all revenue generating points,leakages,monitor the

performance of the respective revenue lines, optimize revenue collection and most importantly assist government and its agencies in planning for sustainable growth and development. There will be a single data entry point and strict processes for data adjustments and control to avoid possible manipulation of inputted information/data. The ERP will also ensure a uniform data in circulation. There will be plugging of leakages through direct access of information from the shipping companies, terminal operators, clearing agents and other operators, given that sometimes the data shippers supply to the regulators are usually different from the figures availed to other operators for the purpose of avoiding charges. When the ERP program is well implemented, all losses and leakages will be blocked. 2. Review of the various concessions and leases entered into by the government with the organized private sector to ensure that the full benefits of those transactions are accrued to the government. Also to be reviewed are the obligations and responsibilities expected from the contracting parties with a viewing of identifying breaches and ways to remedy same, thereby, enhancing efficiency and operational excellence. 3. Designing and implement-

ing a blueprint programme that will ensure that all car rental/ leasing companies, commercial vehicle operators and various land transport terminals/parks are duly registered and granted license to operate by the Federal Ministry of Transportation at a fee that should be renewed annually. Centralizing the registration would promote improved security, monitoring of the safety standard of the vehicle and entrench good behavior by the drivers. All these will also be captured by the ERP. 4. Improving railway terminal infrastructures to make it attractive for organized private sector investments and enhanced appeal to the commuters. This will generate ancillary revenue to the government through concession fees, license fees and taxes. For our national railway system to be improved upon, the need for maintaining the metropolitan, intrastate and interstate infrastructure should be contracted through private companies and leasing arrangements. The Federal Ministry of Transportation, Nigeria Railway Corporation should be responsible on behalf of the federal government and its consultants for managing these arrangements. The following are transport economic factors that need con-

sideration for us to upgrade the system and increase efficiency: What are the acceptable levels of transport infrastructure in a country like Nigeria in the 21st century? What is the current contribution of transport to the Gross Domestic Product (GDP)? What are the strategies to improve the current level of development in the transport sector? How will socio-economic incentives drive new investments in transport infrastructure? How does the enhancement and additional investment in the sector translate to improved quality of life, additional jobs and other economic multipliers? Where are the critical points that need immediate intervention railway, road, water-ways, airports, inland terminals and seaports? Does the regulator need to be regulated or is the supervision inadequate? Overall, the present administration is doing its best but needs to accelerate its approach. By improving the transport system it will bring about a more coordinated, efficient and productive system which can only add value to and improve our economy.

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comment Positive Growth with Babs

Babs Olugbemi Olugbemi FCCA, the Chief Responsibility Officer at Mentor as Leadership Limited and Founder, the Positive Growth Africa

he dictionary.com defines diversity to be a state or fact of being diverse; difference; unlikeness: diversity of opinion. Diversity is an important vocabulary that has come to stay with huge importance in all societies. We have over the time emphasised diversity in Nigeria on the ethnicity, religion and equality basis, hence the federal character slogan. Diversity has been recognised for the race, ethnic, colour, sex, religion and for people with less-ability. However, there is a form of diversity that is, though related to people have not gained traction in recognition among business and political leaders even with those who had travelled wide and far with maximum exposure to top notched management techniques.

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Diversity beyond diversity Peter, (a pseudo name) a Clevel executive of his company, a diversely located entity in Africa travelled outside the country on a week’s work-study to one of the successful international companies within his industry. He was privileged to understudy the CEO of the company in the foreign land and participated at the meetings to observe how things were done. His intention was to study and understand the characteristic of the High-Performing Organisations (HPOs) and replicate this in his company and across its subsidiaries. He noted that Arnold, the CEO, rarely interjects people at meetings and speaks just a few words to conclude or take a decision at meetings. Arnold has been a reputable CEO for two decades and known for ninety per cent accuracy for his decisions. Based on what Peter witnessed and Arnold’s impeccable records, he determined to speak less and listen more. However, he developed the habit of accusing staff at his meetings of speaking too much once the expression of the staff is beyond his tolerable limits. Peter gained exposure to the importance of listening skills, but he failed to value the diversity in the personality of people as the impetus to listening skills. The understanding the personal-

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People communicate differently based on their emotional contents and ability. Neuro-diversity is necessary for the workplace to tolerate people who think and communicate differently either from their ability or inability or out of passion

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ity profile of people as either extrovert and introvert is a key factor to managing people and leading high-performing organizations. People communicate differently based on their emotional contents and ability. Neuro-diversity is necessary for the workplace to tolerate people who think and communicate differently either from their ability or inability or out

of passion. Some of the extroverts we accuse of talking too much if they make sense and don’t deviate from the subject of discussion have the high level of passion and commitment for the organisations. Their level of enthusiasm and ownership thinking is the catalyst for the desire to express diverse views and make meaningful contributions to the team. In the workplace, we need to understand that the diversity in the personality profile of the people is more important than that of their sex, race and religion. The personality is the embodiment of the culture, sex, religion and background of the person. If the personality of the introvert is not understood, a leader will not know how to extract a response from such staff. Most often, the important contributions are in the introvert but lack of the suitable word for expression prompt the silence. An extrovert will willingly volunteer his or her voice and must be moderated if his or her comments are progressive but never be discouraged or shut off with unguided comments. Leaders should be mindful of their unconscious bias in order to get the best from their people. Peter’s attitude made his meetings a place of silence as most of his staff will rather keep being observers than to be embarrassed as someone who talks too much. His engagement be-

came less effective and turned into the one-man show. This was, however, due to his unconsciousness of the need for leaders to find and let the best idea win irrespective of how the idea is expressed. There are many Peters in the workplace. If your disposition to diverse views that is not in line with yours is negative, you are a Peter in another version. Leaders who are progressive must learn to accept the views of others in the search for the strategy to win more business and gain market dominance. Recognising the diversity in the personality of people will give you access to a greater range of ideas and also create a fulfilling work environment for your talents. People that are expressive have been discovered to be more committed to achieving results for their team. At all levels, leaders should be mindful of their bias and generate ideas in a meeting without necessarily making people feel out of order. People are essential to organisations if they must be effective and contribute to the nation’s strive to achieve the objectives of the sustainable development goals.

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Towards the standardization of human resource management practice in Nigeria Jude Adigwe Adigwe is a certified Human Resource Management (HRM) professional and is the Human Resources and Administration Manager at Sharemind Lagos adigwejudeobi@gmail.com

his topic is timely as the Chartered Institute of Personnel Management (CIPM) Nigeria marks its golden jubilee. The human resource management (HRM) profession in Nigeria is an evolving one—though not perfect, it is promising. Regardless of the promise the profession holds, there is still a lot of room for improvement. I will offer a few ideas on how HRM practice in Nigeria can be standardized. First, I think CIPM is doing a great job by preparing aspiring HRM professionals with instructional training prior to being certified. Beyond instructional training, there should be insightful practical sessions embedded in the professional training. Practical sessions make concepts and theories come alive as well as

deepen the insights of students. Workforce planning, recruitment and selection, performance management, training and development et cetera remain abstract until they have been experienced. Practical experience could be gained (before proper employment) through internships, audio-visual sessions et cetera that depict best practices in these different domains. Second, there is need for more robust laws on employment and abecause it guarantees fair play in practice. It guarantees protection of rights of all involved in the employment dynamics. While the laws we have are better than not having any, there is need for lots of improvement. As the world of work evolves so should the laws (that regulate engagement of actors etc.) be reviewed and amended to capture present realities. Third, the need for regular research on HRM issues cannot be overemphasized. Research offers opportunities to have deep insights into issues. With such insights, ideas on how to improve standards of practice are birthed. Rule of thumb, though convenient, can never be a substitute for theory which is an integral part of research. HRM profession-

als must bear in mind that work experience, no matter how vast, is not theory. Fourth, I think CIPM needs to have regular engagements with employers through their associations. This is very important because many of the challenges faced by professionals in practice stem from the unwillingness of employers to uphold best practice despite recommendations offered. The power distance that exists between HRM professionals (who can only advise) and employers (who have reward power as well as the prerogative to make final decisions) is a yawning one. Employers should be made to see the financial and non-financial benefits of accepting some of these recommendations. This might seem a herculean task but it is worth trying. Fifth, the need for licensing or better put, licensed practice cannot be overemphasized. If standards will have to be maintained then it is important to ensure that only licensed individuals are allowed to practice. That said, I know this is almost impossible because Nigeria is every so often bedeviled with challenges of implementation. Regardless of this challenge, CIPM should endeavour to liaise with other regulatory bodies to see how this can be achieved. If this chal-

lenge can be addressed, licensed practice would also imply recognition for professionals who uphold the standards of the profession and sanctions for defaulters. Sixth, there is need for indigenous texts on HRM practice. Business across the globe is heavily influenced by context. This, among other things, would explain the nuances of business operations of same company across branches domiciled in different geographical locations. Since HRM as a profession is geared towards advancing business objectives (through humans), it is only fitting to craft texts that capture the dynamics of doing business in Nigeria and how HRM practice can be seamlessly and strategically aligned without compromising the ideals of the profession. While acknowledging reality we can still strive for ideals. Seventh, the curriculum of higher institutions of learning would need to be periodically updated to capture the emerging issues in the profession. This is paramount because it will deepen the insights of students as well as equip them well to get off to a good start when employed. Also, HRM scholars in higher institutions of learning, should engage in consulting activities in order to stay abreast with burning issues

in organizations, industries and the labour market as it pertains to HRM practice. Students cannot be properly equipped for the world of work if those who teach them do not have any professional engagement outside classrooms. Consulting activities should partly inform decisions on areas to conduct research as well as shape content of and approach (es) to lectures while findings from research should partly inform solutions proffered to organizational problems. This is how practice and research reinforce each other to deepen insights which consequently informs the need and ways to improve standards. From the ideas offered above, it is crystal clear that standardizing the practice of HRM in Nigeria should be done holistically. A holistic approach acknowledges complexities which is a better way to approximate closer to underlying issues. Acknowledging these complexities and addressing them will help us move towards standardizing the HRM practice in Nigeria insofar as we stay committed to the cause come rain or shine.

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Frank Aigbogun editor Anthony Osae-Brown DEPUTY EDITORS John Osadolor, Abuja Bill Okonedo NEWS EDITOR Patrick Atuanya EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, DIGITAL SERVICES Oghenevwoke Ighure GENERAL MANAGER, ADVERT Adeola Ajewole ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso SUBSCRIPTIONS MANAGER Patrick Ijegbai CIRCULATION MANAGER John Okpaire DIGITAL SALES MANAGER Linda Ochugbua GM, BUSINESS DEVELOPMENT (North)

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Thursday 15 November 2018

Killing of Shiites must stop in Nigeria

n December 12, 2015, the military took the law into its hands and massacred over 347 members of the Islamic Movement of Nigeria (IMN) who allegedly blocked the convoy of the Chief of Army Staff, Lt.-Gen. Tukur Buratai. Although the military has used several lies to justify the killings, a panel set up by the Kaduna state government to investigate the killings indicted the Nigerian army for the Zaria massacre. Specifically, the panel indicted Maj. General Adeniyi Oyebade, the General Officer Commanding the Nigerian Army’s 1st Devision in Kaduna for authorising the operation. The Panel only stopped short of indicting the Chief of Army Staff General Burutai who also bears responsibility for, and has defended, the killings on several occasions. Regardless, the army stands accused of grave killings of civilians and crime against humanity. The Panel rightly pointed out that the killings are a crime against humanity and those re-

sponsible must be brought to justice. The report also blamed the leader of the Islamic Movement in Nigeria (IMN), Sheikh Ibraheem El-Zakzaky for the clash and recommended that he should be investigated and prosecuted. The government said that the action was taken to preserve peace and stability in the state. Since then, the members of the group – this time not only in Kaduna but also in Abuja, Kano, Katsina and Jos have been protesting the government’s actions and also demanding for the unconditional release of their leader, ElZakzaky, his wife and other members of the IMN who had been in detention unlawfully since their arrest in 2015 following the sect’s clash with the Nigerian Army. Sadly, the sect’s members are being systematically mowed down and killed in several states for protesting the ban on their sect and the continued incarceration of their leader and members or for simply embarking on their religious processions. Some weeks ago, soldiers again opened fire on the group who were on a religious procession which began around the Suleja area

of Niger State. They encountered soldiers around Zuba, a satellite area of Abuja and issues quickly escalated. Videos appeared online showing irate members of the sect throwing stones at soldiers with soldiers shooting live bullets at them as if in a war situation. Hostilities resumed again two days later, in Wuse, Abuja with security agencies shooting members of the sect protesting the killing of their members. We note the increasing crackdown on Shia Islam in Nigeria since the ascension to the president of Mohammadu Buhari, a Sunni Muslim. In 2016, President Buhari confirmed Nigeria’s membership in the Islamic Coalition against terrorism formed in 2015 by Islamic countries following the order of Saudi Arabia, the leading Sunni nation. Iran was conspicuously left out of the coalition. On the surface, it appears an innocuous move, but underneath the move is a pandering towards Saudi Arabia and other Sunni countries who have never hidden their hostility towards Shia Islam. To make matters worse, the Nigerian government condemned

the Iranian-backed Shia Houthi militia resistance group fighting the Saudi-backed government of Abid Rabbo Mansur Hadi in Yemen for targeting the Holiest city of Islam, Mecca, in a ballistic missile attack – a claim hotly disputed by both the Houthis and their Iranian backers. The reality is that the Buhari government is dragging Nigeria into a SaudiIran proxy war. Paradoxically, those two countries have somehow managed to keep this conflict out of their lands, and have turned other countries into proxy battlefields for political supremacy. We note and commend the restraint show by Shiites who, despite the shocking scale of persecution and killings, have not resorted to taking up arms against the Nigerian state. Nigeria is still a volatile country trying to overcome the Boko Haram insurgency. It cannot afford another deadly conflict. We urge the federal government to desist from persecuting the Shia’s in Nigeria, release its leader on bail as granted by the courts and also punish all those involved in the killing of IMN members. A stitch in time saves nine.

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BUSINESS DAY

Thursday 15 November 2018

CityFile Ekiti warns against illegal levies in schools

RAPHAEL ADEYANJU, Ado-Ekiti kiti State government has ordered heads of public primary and secondary schools who had collected unauthorized levies at the beginning of the 2018/2019 academic year to return same to their pupils and students. The deputy governor, Bisi Egbeyemi, who ordered a full compliance by head teachers and principals of the schools, said education development levy and other unauthorised fees, remained abolished in the state. In a statement signed by Odunayo Ogunmola, his special adviser on media, the deputy governor further directed that evidence of such refunds must be brought to the ministry of education for verification. He stressed that where such fees have been collected and remitted into government coffers, such schools should bring the evidence of such remittance to the ministry of education. Egbeyemi said the action was consequent upon the Executive Order 001 signed by Governor Kayode Fayemi on October 24, 2018 abolishing payment of education development levy and other unauthorised fees in the state.

A cross section of traders being attended to by TraderMoni officials at oyingbo Market in Lagos, on Tuesday.

Electrician bags 6 months for stealing

Bonga oil spill: Victims urge FG to A prevail on Shell to pay $3.6bn fine SAMUEL ESE with agency report

rtisanal fishermen in the Niger Delta, affected by the December 2011 Bonga oil spill, have urged the Federal Government to compel Shell to pay the $3.6 billion fine for the spill. Samuel Ayadi, coordinator, Niger Delta Zone, Artisana Fishermen Association of Nigeria, made the call in Yenagoa. Justice Mojisola Olatoregun of a Lagos Federal High Court, on June 20, had upheld the $3.6 billion fine imposed on Shell by the National Oil Spills Detection and Response Agency (NOSDRA) and dismissed Shell’s appeal. Ayadi lamented that Shell Nigeria Production and Exploration Company (SNEPCO), had yet to comply with the court order, saying that the judgment was a lifeline to the fishermen. Following the December 20, 2011 spill, NOSDRA in March 2015, imposed a $3.6 billion fine on Shell for discharging 40,000

barrels of crude into the Atlantic Ocean. The fine comprised $1.8 billion as compensation for the damage to the natural resources and consequential loss of income by the affected shoreline communities as well as a punitive damage of $1.8 billion. Ayo Akinyerule, chairman of NOSDRA board, had urged SNEPCO to pay the fine to enable the agency to compensate the impacted fishermen and communities. Ayadi said that the fishermen thrown out of business by the incident had patiently waited for the litigation processes to end. “The Bonga oil spill was a heavy blow to us artisanal fishermen. Ironically the spill from the oilfield named after the local fish specie, Bonga, was what led to the near extinction of the specie. We can no longer see Bonga fish in our dishes because the spill wiped out generations of the specie. He said the fishermen in the wake of the spill, were were directed by NOSDRA to pull out of fishing to avoid catching

contaminated fish that would jeopardise public health. “The income loss is in addition to the damage done by the contamination of our fishing gear, outboard engines and nets. Since the three months appeal window has lapsed, we call on President Muhammadu Buhari to prevail on SNEPCO to comply with the court judgment and pay the fine so that NOSDRA can compensate the victims,” he said. Ayadi said their return to sea will also guarantee that they play their own part in ensuring food security and reducing dependence on imported fish. It would be recalled that on December 20, 2011, during loading of crude at Bonga fields within OML 118 situated 120 kilometres off the Atlantic coastline, the export line ruptured and discharged crude into the sea. The export line, according to a joint investigation report by NOSDRA and SNEPCO spewed about 40,000 barrels (6.4 million litres) of crude oil into the sea.

Man to die by hanging for killing father

Jos Court of Appeal (COA) has sentenced a middle-aged man Jibril Idrisa, to death by hanging for killing his aged father over N56,000.00 being proceeds from the sale of Guinea Corn. Delivering judgment, Justice Habib Abima, over-turned the judgment of the Lower Court that acquitted Idrisa. “The court sets aside the judgment

delivered by the lower Court discharging and acquitting Jibril Idris. “He is found guilty of the offence of culpable homicide punishable with death contrary to section 211 of the penal code law of Bauchi State. “The court hereby sentences him (Jibril Idris) to death by hanging,’’ the Abima ordered. The appellate court held that the lower court erred in its judgment.

Family members of the deceased, through their counsel, Ishaq Magaji, prayed the appellate court to set aside the January 26, judgment of Justice M.A. Sambo of the state High Court, Bauchi. Magaji said that convict agreed that he killed his father and buried him in a shallow grave beside a river in Tafawa Balewa, after an argument over the proceeds from the sale of some bags of Guinea corn.

n Iyaganku Chief Magistrate Court in Ibadan on has sentenced an electrician, Adeoye Babalola to six months imprisonment for breaking into a student’s house and stealing a laptop and other items. The chief magistrate, Abdulateef Adebisi, ordered Babalola, 28, to spend six months in the Agodi Federal Prison for the offences. Adebisi convicted and sentenced Babalola following his guilty plea and based on evidence before the court. “You are found guilty on count two, breaking in, and you are sentenced to three months imprisonment; on count three, stealing, you are to serve three months in prison,’’ he held. The chief magistrate, however, said that the sentences are to run concurrently. Adebisi also gave the convict an option of N5, 000 fine on each count. Babalola was charged alongside one Yusuf Ibrahim, 22, on three-count charge of receiving stolen goods, break in and stealing. Salewa Hammed, the police prosecutor, told the court that Babalola broke into the residence of one Morenikeji Ademola and stole some items. “The accused stole a brown bag valued at N5,000 containing a laptop worth N35,000, a pressing iron valued at N3,000 and a power bank worth N3,000, property of Ademola. “Babalola was caught in the act by a community leader, Mathias Abiyosoye, who reported the case at the Apete Police Station,’’ Hammed said. The prosecutor also told the court that Ibrahim, who allegedly received the plasma television set, cell phones, laptop and gas cylinder from Babalola, knew that the items were stolen. Ibrahim, however, pleaded not guilty to the charge of receiving stolen goods. He was granted bail in the sum of N50, 000 with one surety in the like sum. The offences contravene section 390, 411 (1) 427 of the Criminal Code, Laws of Oyo State 2000. The case is to be heard again on December 27.

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Thursday 15 November 2018

BUSINESSTRAVEL SAHCO upgrades facilities to deliver premium services to customers … Renews ground handling contract with Arik Air Stories by IFEOMA OKEKE

kyway Aviation Handling Company Public Liability Company (SAHCO) has continued to invest in the upgrade of its facilities and equipment to deliver quality services to its customers. A visit by BusinessDay to the facility recently show that the company has expanded its warehouse to accommodate more consignments and purchased newer equipment to cater for the increasing influx of cargo into its facility. Speaking during a media tour at the company’s headquarters in Lagos, Basil Agboarumi, the managing director/CEO, SAHCO, said as a forward-looking company, SAHCO has tapped into the vast technology available to ground aviation handlers all over the world as this is evident in the upgrade of its facilities and equipment that meets global standard. Agboarumi assured that the company will continue to provide passenger handling, ramp handling, cargo handling, aviation security, premium lounge and baggage reconciliation services in all commercial airports across Nigeria. Speaking on the growth of the company, he said, “Over the years, SAHCO has recorded tremendous growth, remarkable improvements and have added value to aviation development in Nigeria. Our market share grew from 21percent in 2009 to over 40percent and our revenue has grown by over 100percent post privitisation. “By the end of December 2017,

SAHCO has maintained a stable operating performance with a compounded annual revenue growth rate of 4.43percent. The company also recorded improved profitability with a five year average operating and profit margin of 12.1percent and 11.6percent respectively by the end of December, 2017.” On the renewed agreement with Arik Air, Agboarumi emphasised that it portends endorsement and credibility on the services of the ground handling company, as the agreement was renewed for another three years. He said: “Today is unique for SAHCO. The Initial Public Offering (IPO) for SAHCO has begun and we are signing this contract with Arik Air. Arik Air has been with SAHCO for several years and we have witnessed the growth of the company over the years. “We are happy that the new management has established the airline on the right path. Arik Air is a good company to do business with. We are very proud to associate with the air-

Ethiopian takes delivery of its eighth freighter

thiopian Cargo & Logistics Services, Africa’s Largest Cargo operator, has taken delivery of its 8th B777 freighter aircraft in its cargo fleet family, on November 10, 2018 at its home base at Bole International Airport. Maintaining its trajectory of rapid growth and expansion in the global cargo industry, Africa’s Largest Cargo Service provider and largest Global Cargo Network, Ethiopian Cargo and Logistics Services, play a critical role in providing global standard supply chain management in facilitating import and export economies of African countries. Regarding the delivery of the new freighter, Tewolde GebreMariam, Ethiopian group CEO, said, “We are

very delighted to welcome our 8th B777 freighter aircraft. The new aircraft will help us bolster our leading role in cargo operation in Africa and beyond, further expanding our commendable contribution in boosting the continent’s airfreight export/ import traffic as laid out in our Vision 2025. “As the largest cargo operator in Africa, we are currently serving over 44 international dedicated Freighter destinations in the Africa, the Gulf, Middle East, Asia, the Americas and Europe, augmenting the export of perishable farm products from the continent of Africa and the import of high value industrial goods. With more freighters on order, we are set to consolidate our role in availing much needed airfreight service within Africa and beyond, further catalysing the continent’s economic growth.” Regarding its 15-year growth road map, Vision 2025, Ethiopian Cargo and Logistics Services envisions generating two billion dollars of revenue with 19 dedicated freighter aircraft and transporting 820,000 tons of cargo to 57 destinations.

line. Wherever Arik Air is mentioned, we will stand up for you. We have new equipment coming in. Some of them are on the high seas, while others are with us here already in the country. Also, Murat Ozcan, vice president, ground operations for Arik Air said that the airline had for the past five years developed a mutual relationship with SAHCO. He added that the management would be willing to constantly renew its contracts with the ground handling company. He posited that equipment of SAHCO had improved over the years and urged the management to constantly invest in state-of-the-art equipment. “We have a very long standing relationship with SAHCO and they have always been there for Arik Airlines. For the past five years, we have had a very great experience with them and I am happy to say that we have signed for another three years for SAHCO to provide ground handling assistance for our networks.

Why we are yet to launch our international flights - Air Peace

ir Peace has blamed aviation politics for the delay in starting its flights to longhaul routes, including London, Guangzhou-China, Houston, Mumbai, Johannesburg, Dubai and Sharjah. Speaking at the 5th Aviation Stakeholders’ Forum organised by the Federal Ministry of Transport in Abuja on Thursday, Oluwatoyin Olajide, Air Peace chief operating officer, said authorities of most of the international destinations the carrier had been designated to operate to were either deliberately foot-dragging in processing its application or imposing frustrating conditions to discourage it from flying into their domains. Some of the destination countries, she said, responded to the airline’s application only after about two years. Where the destination countries reluctantly approved the airline’s application to fly into their domains, Olajide regretted, impossible charges were imposed to frustrate and discourage it from acting on such approval. The high charges imposed on Nigerian airlines by other nations, she said, were unfortunately not responded to back home. The foreign airlines were rather pampered in Nigeria and given approval to operate to multiple destinations. She dismissed claims that domes-

tic airlines lacked the capacity to take advantage of the Bilateral Air Service Agreements (BASA) Nigeria signed with different countries. In demonstration of its capacity, she said, Air Peace was at the moment consistently operating into 14 domestic and five regional destinations, including Accra, Banjul, Dakar, Freetown and Monrovia. Olajide maintained that Air Peace had capacity to operate into all destinations approved for it, announcing that the airline was concluding arrangements to launch its Dubai and Sharjah services before the end of the year. In apparent response to the claim that some foreign airlines operating in Nigeria had offered 20 pilots jobs, the Air Peace COO said the carrier had so far directly offered jobs to more than three thousand Nigerians, besides impacting the nation’s economy in many other respects. She also identified the inability of airlines to operate into most of the nation’s airports once it was sunset as a great disservice to the operational capacity of the carriers. Speaking on the suspended national carrier project, which Air Peace had criticised as being out of fashion and a drain on public resources, Olajide wondered whether it would be fair for the Federal Government to confer the planned airline with advantages not available to the existing private carriers.

Dana Air celebrates 10 years of service to Nigeria

ana Air has celebrated its 10th anniversary in Nigeria’s aviation industry with a strong commitment to continue to offer its guests the best of service hinged on safety and customer satisfaction. Obi Mbanuzuo, the chief operating officer of Dana Air while addressing newsmen in Lagos said, “despite all the challenges that airlines in Nigeria have to grapple with, Dana Air is proud to be celebrating 10 years of providing massive job opportunities, capacity development, training, broad corporate social responsibility and most of all, amazing flight service to Nigeria and Nigerians. “When we commenced operations 10 years ago, precisely on the 10th of November, 2008, our desire was to change the convention and exceed the flying aspiration of our guests with our world-class services and today, with the support and loyalty of our esteemed guests, we have been able to achieve 10 years of service to Nigerians. “As you may be aware, we are

about the second private domestic airline in Nigeria’s history to achieve this feat, and it’s on record that over 60 airlines have gone under without being able to even survive even 5 years in the industry. It hasn’t been easy as we have had to grapple with a lot of challenges in the last 10 years ranging from infrastructure, multiple taxes, and high cost of aviation fuel, but we are delighted to have been able to brave the storm and I must say our commitment, proficient management style, high standards, and passion for excellence brought us this far.’’ On the airline’s CSR since inception, Obi said, “we have done quite a lot. Through our charitable trust, the Dana Foundation, we have been fulfilling our Corporate social responsibility with an in-flight envelop donation program and this has helped to raise millions of naira for the sickle cell foundation in Lagos, as well as autism patients. “We have also supported a couple of other similar organizations like Rotary Club on blood donation and cancer fighting organizations

like project PinkBlue, Children Living with Cancer Foundation just to mention a few.’’ Commenting on the airline’s sponsorship of two Nigerian clubs, the Dana Air accountable manager said, “Dana Air is the only Nigerian airline at the moment sponsoring two Nigerian league clubs- Heartland FC of Owerri and Akwa United fc in Akwa Ibom state. In unveiling the multimillion naira deal for both clubs, we considered their status. “For Akwa, they just won the Aiteo cup at the time, and Heartland, the governor wanted something special not just for his players but his people and our partnership with the government is part of what the stateowned club is enjoying at the moment. This has also helped ease their transportation to away games, and improve their away performance.’ “As part of our commitment to help our teeming youths achieve their dreams and also grow their craft, we have supported a couple of entertainment and comedy shows in Nigeria.”

Thursday 15 November 2018

BUSINESS

COMPANIES & MARKETS

DAY

Ecobank partners IFRC to strengthen Africa communities

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C O M PA N Y N E W S A N A LY S I S A N D I N S I G H T

OIL & GAS

Oando aims to boost crude oil output by 25% in 2019 DAVID IBIDAPO

a n d o p la ns to pump 25 percent more oil in 2019 than it currently does, according to Wale Tinubu, group chief executive officer of the indigenous oil company. That will take the company’s production to 50,000 barrels daily from 40,000 in the space of a year. Tinubu, who spoke at an energy conference in Abu Dhabi last week, also said his company targets an increase of 50,000 barrels daily over the next three years, at which point the company’s total production would more than double from current levels to 90,000 barrels daily. Oando stocks gained 1 percent to N5 per share Tuesday, according to NSE data.

The stock price is down 17 percent to from its N5.99 peak as at January, a broader reflection of the broad index which is also down some 16 percent year to date as political uncertainty thickens ahead of the 2019 elections. Until late October, oil prices had crossed the $80 per barrel mark in what was not only good news for the economy but for oil companies in Nigeria. Oil prices have however headed south in November, falling as low as $67 per barrel Tuesday, according to Bloomberg data. Tinubu expects further downward pressure on crude oil prices going forward. “There will be a lot more oil coming to the market. I see a lot of volatility with a long-term downward trend in prices. Oil price may drop to $60/bbl next year,” Tinubu said. “The market needs to

prepare for greater U.S. exports; U.S. shale production will be enough to outweigh declines elsewhere,” he added. BusinessDay analysis of Oando’s nine months financial period ended 2018 showed that the company

grew its revenue from external customers from its exploration and production section by 56 percent from N76 billion in 2017 to N118.8 billion. Revenue from supply and trading also grew by 26 percent during the period.

PUBLIC INSTITUTIONS

FIRS to miss tax collection target for 4th straight year LOLADE AKINMURELE

he Fe deral Inland Revenue Service (FIRS) is unlikely to meet its 2018 tax collection target of N6.75 trillion in a potential blow to government revenue and signal of dwindling company profits. Over the past decade, the Nigerian equivalent of the United States IRS, hit its annual target through to 2014, but has since fallen short of budget for the past three years. If the 2018 target is not attained, the FIRS would have missed its target for four straight years. The tax agency could only raise N2.5 trillion in the first half of 2018, 37 percent of the full-year target. Babatunde Fowler, FIRS chairman, said last week t h a t t h e a g e n c y ’s t o t a l take this year (non-oil taxes and petroleum profits tax combined) through to end-October was N4.3

trillion. At this rate, it would achieve N5.16 trillion for the full year, well short of the budget but still its best collection to date ahead o f 2 0 12’s N5.01 trillion, according to data collated by investment bank, FBN Quest. The quarterly target for collection is N1.69 trillion yet the FIRS managed N1.17 trillion in the first quarter of 2018 and N1.33 trillion in the second quarter, which are both below target.

The poor outturn hasn’t led to a more conservative target. The 2018 target represents increases of 38 percent and 67 percent on the budget and the outturn for 2017. Analysts have been critical of the over-optimistic target, arguing that an economy still licking its wounds from a recession in 2016 makes it almost impossible to rake in the budgeted sum. Fowler said the agency

was vigorously pursuing 6,000 firms it had identified with annual sales over N1 billion but without a record of “commensurate” tax payments. This pursuit, sometimes through the firms’ banks, has been queried by some leading accountancy firms in Lagos. A tax amnesty programme expected to raise N306 billion has not been successful, as only N30 billion has been raised. That’s less than 10 percent of the target. Efforts to boost tax revenues in Nigeria, where tax as a percentage of GDP is as low as 7 percent, has intensified in the last three years as the government attempts to wean itself from an overdependence on crude oil. The FIRS is the leading tax collection agency and has therefore the greatest responsibility for achieving the FGN’s targets for total revenue. The FGN’s share per the approved 2018 budget is N88 billion.

Revenue stood at N386 billion in 2018 from N306.3 billion in 2017. The decline in crude oil prices since October this year coupled with short falls in crude oil production and crude oil exports have raised major concerns for

the Nigerian economy. Nigeria’s crude oil production is currently at a deficit of about 200, 000 barrels with an average production of 1.8 million barrels per day, below the budgeted benchmark of 2.0 million b/d.

TELECOMS

MTN CEO shrugs off Nigeria dispute as he lays out banking plans BLOOMBERG

hrugging off the small matter of $10.1 billion of claims against Africa’s largest wireless carrier in Nigeria, Rob Shuter, CEO of MTN Group told a conference in Cape Town on Tuesday that MTN will apply for a mobile-money license in the country in the next month. That’ll be followed by a concerted financial-services roll out next year to its more than 60 million Nigerian subscribers. The pledge is a clear sign MTN is committed to Nigeria into 2019 and beyond, despite a run of disputes that’s cut its market value in half over the past three years. The latest of those troubles are an allegation by Nigeria’s central bank that MTN illegally repatriated $8.1 billion, and a separate claim that the wireless carrier owes $2 billion in back taxes.

The crisis is so severe that South Africa’s Reserve Bank warned last week that the country’s entire financial system would be at risk, should MTN be forced to transfer the full $10.1 billion. A full withdrawal from Nigeria would be a “worstcase scenario,” the institution said in its Financial Stability Review. But for now, that doesn’t appear to be on the table. Sitting alongside the MTN CEO at the same conference, Nigerian Communications Commission Chairman Olabiyi Durojaiye said the regulator is “ready to work and co-operate” with the phone company. Shuter added that he’s working with the relevant authorities to get to a suitable resolution. A deal is close, a person familiar with the matter said on Thursday, and Shuter may be making plans with an end game in sight.

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Thursday 15 November 2018

Business Event

BANKING

Ecobank partners IFRC to strengthen Africa communities BALA AUGIE

cobank and the International Federation of Red Cross and Red Crescent Societies (IFRC) have signed an agreement to work closely together to empower local communities to cope with disasters more efficiently. “Many innocent lives continue to be lost in Africa simply as a result of insufficient investment in disaster preparedness. Many of the natural hazards that take place do not need to become major disasters when a population is prepared and able to respond adequately. We need to address the underlying causes of this vulnerability, including lack of funding to equip communities with required systems and skills,” said Fatoumata Nafo-Traoré, IFRC’s Regional Director for Africa. The growing gap between funds needed by humanitarian groups and funds available to them is a major cause of communities’ vulnerability to disasters. It is on this account that Ecobank is partner-

ing with National Red Cross and Red Crescent Societies in Africa to secure resources for their local first aid volunteers. “Ecobank will leverage its innovative technology to fundraise across Africa in an effort to mobilise capital to help narrow the funding gap. Through our Ecobank Mobile App, we will be able to support the Red Cross and Red Crescent’s domestic fundraising efforts,” said Sam Adjei, Regional Executive, Central, Eastern and Southern Africa (CESA) and Ecobank Kenya’s Managing Director. A first project is already being rolled out in Ghana where Ecobank is launching a digital public fundraising campaign. A unique QR code (a type of bar code used to access information through your mobile phone) has been created and displayed in branches, making donating easy and immediate. “Transforming Africa is the principle on which Ecobank has built its business,” added Sam Adjei. “Today, we are present in 33 countries across the continent. That scale is what creates impact

and determines how well we take our continent to the next level in a sustainable way.” Training will be another key pillar of the partnership, as IFRC will work with the Ecobank Academy, a pan-African corporate university based in Lomé, Togo. IFRC’s staff members will participate in a number of customised programmes to enhance their management skills. As part of the agreement Ecobank employees will also be given the opportunity to attend First Aid training sessions, enabling them to save lives during every day emergencies and disasters. Ecobank Tanzania will be the first Ecobank affiliate to roll out a first aid training course for its staff. “Supporting Africa’s most vulnerable by investing in local humanitarian organisations is not only cost-effective but it also ensures long-term and sustainable results. Local humanitarian actors make a difference every day in their own communities. They respond to crises quickly, providing assistance that is culturally appropriate,” said Nafo-Traoré.

L-R: Abdulrazak Jayeiola, president, Institute of Chartered Accountants of Nigeria; Bello Kazaure Husseini, high commissioner, Nigerian High Commission, Australia, and Lawal Itopa Lamidi, fellow, Institute of Chartered Accountants of Nigeria, during the commission’s hosting of Nigerian delegates to the World Congress of Accountants held at Sydney, Australia.

Coronation CEO sees Nigeria’s population as allure to investors MICHEAL ANI

espite declining foreign investments as a result of increased tension in the buildup to the 2019 elections, alongside increasing rates in advanced countries that has aggravated sell offs in emerging markets, Nigeria’s population is still a number that no investor can ignore, Jimoh Ibrahim, CEO of Coronation merchant bank said. “Investment is all about risk and returns, even in worst economies, investors will always be interested in investing if they knew they will get a premium for the kind of risk they are taking. A country like Nigeria, with a population of 198million, which is a number no investor will ever want to ignore”,Jimoh said at the side-line, when the bank partnered the ChatteredfinancialAnalysts(CFA)society in attracting investment in Nigeria. Foreign direct investment in Nigeria fell to 379.84 billion naira ($1.2 billion) in the first half of the year from 532.63 billion naira ($1.7 billion) a year earlier, the Central bank of Nigeria said in its half year economic report. The apex bank also noted the

closure of two global banks (HSBC and UBS) local offices in the countries, for reasons not disclosed. Controversies have trailed their closure especially given the fact that HSBChashadseveralbacklashfrom the government after it predicted that Nigeria’s president Buhari’s victory in the 2019 elections will stall the economy. In the same vein, UBS has also expressed displeasure over the CBN’s hammer on the country’s biggest non-oil foreign direct investment, after the former instructed the telecom giant to bring back an $8.1 billion it illegally repatriated as dividend since 2007. Jimoh said “it is normal, some investors will come, while some will leave,becausetheyredefinetheirrisk rewardframeworkfromtimetotime, and if this risk reward frame work is no longer in line with their expectations, it doesn’t mean that things are not the way they should be”. “On the issue of MTN, Jimoh said the regulator has decided on, the regulator must have done their investigation and decided on the best decision for the country. Of course, it will have impact on direct investors but the government is also interestedinresolvingthesituationin

such a way that it doesn’t have much negative impact on the economy. As such, I am sure very soon, it will be resolved”. However,whilethetalkoftheexit of these lenders have raised questions in the heart of investors, Egyptian financial services giant, EFG Hermes last week, announced it will be getting an investment-banking licenseinNigeriathisweek,aspartof itsplansinexpandingitscapitalmarket business across frontier markets. “Inanycountry,duringelections, you always see the Impact on the economy especially in the market. If you look at the US, even with the Mid-term elections the New York stock index dropped by more than 2000 points over in the last three weeks,sothesituationisnotpeculiar to Nigeria. I think the government is doingwhattheyneedtodotoensure thattheeaseofbusinesscontinuesto improve and investors are going to keep coming in”. “I think also that things are going togetbetter,asittakestimeforimpact of infrastructural things put in place to be felt in an economy. I think overtimewewillstartseeingthattheeffort of government and Central Bank is yielding result”,Jimoh said.

EVENT

Over 500 business executives expected at 2018 French Week ISAAC ANYAOGU

rganisers of The French Week, an annual celebration held around the world to celebrate bilateral relationship between France and other countries will commence from November 16 in Nigeria and over 500 business executives and government functionaries are expected at the annual event. “The Economic relation between France and Nigeria is ever growing,” says Moses Umoru, the director General of Franco Nigerian Chamber of Commerce in a release sent to BusinessDay. Moses further said, “Bilateral trade stands at 3.6 billion Euros as at year end 2017. Nigeria stands as the leading trade partner of

France within the sub-Saharan African region and the 9th largest worldwide. “ According to Moses, the trade products between both countries range from refined petroleum, pharmaceuticals, mechanical, agro foods, to natural hydrocarbon. Moses said the visit of the president of the French republic, Emmanuel Macron in July of 2018 has brought about renewed relationship between both countries. “The 1% interest loan support for Lagos, Kano and Ogun states to the tune of 475,000 Euros during the visit is a testament to France support for Nigeria’s development and growth. This has resulted in greater confidence in the Nigerian market by French

investors. According to the organisers, the 2018 French Week will hold from the 16th -23rd of November, 2018. Some of the events scheduled to take place include the Beaujolais Nouveau Cocktail (Wine tasting event) holding on Friday 16th November at the Moorhouse Hotel Ikoyi. The highlight of the event is usually its economic summit and this year’s theme is “The Nigerian Business Environment, Cross Border Trading Doing Business in France which will hold in Lagos. Jumoke Oduwole, Senior Special assistant to the Federal Government of Nigeria on Industry Trade and Investment has been selected to give to Keynote address on the theme.

L-R: Banji Fehintola, president, CFA Society Nigeria; Stella-Marie Omogbai, head, corporate banking; Olufunsho Olusanya, executive director, treasury & international banking both of FSDH Merchant Bank Limited, and Uche Olowu, president/chairman of council, Chartered Institute of Bankers of Nigeria at the CFA Society Nigeria Awards ceremony. FSDH Merchant Bank was presented with the Gender Diversity Award in promoting Career Progression for Women in firms with less than 500 employees Category at the Eko Convention Center in Lagos.

L-R: Temidayo Ekundayo; Funmi Ekundayo, MD/CEO, STL Trustees; Akin Naphtal, CEO, InstinctWave, and Akinwumi Oni, head of Trust Services and legal, STL Trustees Limited, at the 4th Nigeria Finance Innovation Awards (NFIA) where Funmi Ekundayo of STL Trustees won ‘The Trustees’ CEO of the year 2018 Award

L-R: Innocent Oboh, president/CEO, Dijo Group, receiving award from Emma Wenani, business director, Global Media Alliance, Ghana at the Nigeria Brand Awards that happened recently.

Thursday 15 November 2018

Research & INSIGHT A WEEKLY PUBLICATION OF BUSINESSDAY RESEARCH & INTELLIGENCE UNIT(BRIU)

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How addressing housing deficit can solve unemployment rates in Nigeria ISAAC ESOWE

ciation of Home Builders (NAHB), building or rehabilitating of a housing stock creates jobs in the construction space; the association estimated that by building 100 affordable housing units for families through the low-income housing tax credit program could lead to the creation of more than 120 jobs, on average, during the projects’ construction phases. Even more importantly, long after the homes are occupied, the resultant effects from the residents in these new units can support as many as 30 new jobs in a wide array of industries, including retail, healthcare, and local governments. State and local government

will benefit immensely By bridging the housing deficit will impact greatly on the revenue of the state and local governments as when affordable homes are built, the funds coming into the cities and states can be substantial. Revenues can take the form of fees for permitting, zoning, and utilities, or they can reflect sales, income, or property taxes generated by constructionrelated economic activities. PROSPECTS OF THE HOUSING SECTOR According to the data gathered from Nigeria.gov.ng and compiled by BusinesDay Research and Intelligent Unit(BRIU) shows that the housing sector has the capacity to

engender employment, increase productivity, raise standard of living and alleviate poverty. It also has the capacity to reduce crime rates, civil disobedience, militancy, and terrorism and substantially address wealth distribution as well as security concerns. It has the capacity to achieve this because investment in housing affects all facets of our lives through its multiplier effect on economic development and forward linkages to the financial markets and backward linkages to land, building materials, tools, furniture and labour markets. Typically, a country’s labour force in the built environment consists of all professionals such as land surveyors, town planners,

12734BDN

igeria’s housing shortages could be a blessing in disguise, as behind this challenge lies an opportunity that could change the economic outlook of the nation particularly in addressing the unemployment and poverty levels in Nigeria. The housing deficit in Nigeria has widened in the last two decades, as a result of rapid growth in population which is estimated at about 199.0 million people as at the end of the second quarter of 2018. In 1991, housing deficit was estimated at 7 million housing units but increased to 12 million housing units in 2007; 14 million housing units in 2010 while as at the end of 2011, it stood at 16 million housing units. In first half of 2018, housing deficit was estimated by real estate industry experts to be not fewer than 20 million housing units. Research shows that in bridging this housing gap and creating affordable housing units to meet housing demand will create a good number of job opportunities both during the construction process, installation of electrical appliances and other housing gadgets, with attendant boost in consumer spending. This process will in turn engage both skilled and unskilled individuals, more so, reduced the unemployment rate which is at all time high in the country. Consequently, it is more worrisome to know that the Nigerian leaders at both the federal and state levels are not looking at tapping the opportunities in the housing sector to address unemployment when the number of the unemployed and underemployed across 36 the state of the federation stood at about 31.4 million as at the end of 2017. The portion of the unemployed Nigerians accounts for 17 per cent of the total labour force which is at about 83.9 million people. This happens in a country where investment in housing stock alone has the tendency to help bridge the unemployment and infrastructural gap. According to National Asso-

architects, quantity surveyors, builders and engineers as well as skilled and unskilled labour namely bricklayers, plumbers, carpenters, welders, painters, electricians, suppliers of building materials, block moulders, security men, drivers, horticulturists, gardeners, etc. Taking the construction of a medium-sized (2/3 bedrooms) bungalow as an example, it is capable of directly creating employment for an average of 76 workers. The number goes up significantly when the forward and backward linkages are factored into the process. Therefore, for a 1,000 housing schemes of two bedroom bungalows, on the average, up to 76,000 workers could be engaged for a period of between 12-18 months. Globalisation also creates more opportunities for the practitioners in the building construction industry. There is larger market due to involvement of international finance. Foreign direct investment on projects leads to increase in construction demand. Competition between foreign firms enhances value for money of projects in the host country. With globalisation, cross-fertilisation of ideas and innovations are enhanced just as there will be possibility for technology transfers and development of local firms will further increase the adoption and application of information technology among indigenous companies and professionals. It should be noted that the real estate industry makes up about 60 percent of the world’s global assets. In the developed countries, the real estate industry supports the financial sector, enabling the creation of asset-backed loans and securities. The Nigeria’s real estate system cannot work without a proper land registry as banks cannot lend against a property without evidence of ownership. The current land ownership system is burdensome and excludes many people from formal ownership. Based on these facts, real estate is one of the most critical sectors that if reformed will propel growth and alleviate poverty in Nigeria.

WIDE OPEN MINDED RMB Nigeria. Solutionist Thinking.

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CEO INTERVIEW

Thursday 15 November 2018

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Baker Magunda CEO of Guinness Nigeria Plc

Interview with Private Sector Leaders

We have doubled our market share in 12 years - Guinness Nigeria CEO Baker Magunda, new CEO of Guinness Nigeria Plc in this interview with BusinessDay’s Frank Eleanya, discusses the company’s financial year results for 2018 which it released recently. He opens up the company’s outlook and investments in the areas of technology and human capital.

ooking at the 2018 financial year, what can your organisation say stood out? Last week in Abuja, we announced dividends which reflected a massive growth in the organisation. The dividends we gave our shareholders was just about N4 billion and that is double what we gave out in the year before. I also think I should celebrate that team that was here before me for tightening the cost structure of the organisation. There was high inflation, low opportunity on pricing, cost of production going up, the ability to deliver real time with the savings of the organisation and making ourselves fit for a competitive environment was a very big deal then. Two other things I want to speak about are that, in spite of the challenges that we are talking about, we kept true to our words and we continue to do things in the community. We are committed to delivering water to communities, and working with farmers to share their prosperity, and doing the ‘I Care’ initiative to the hospitals. I think that is something we need to celebrate as well. Tough as the times are, one is holding true to the values that we stand for. The final thing is celebrating the growth of our people. Lots of them are being promoted within the organisation and there were new people hired into the organization. We have seen real improvement in our gender balancing. Of all the people we hired in 2018, about 43 per cent were female, which is the highest we’ve done. My leadership team is 50-50 male and female. You won’t find that in many organisations in Nige-

ria. We have exported a lot of talents in the market as well. So it is a good thing just seeing the growth of our people and sharing what they know. You saw an increase in taxes in 2018 and consumers rejected price increase yet the dividend you paid rose, what exactly did you do differently? Our financials end JulyJune. So when we talk about 2018 results, we talk about July 2017 to June 2018. The tax increase happened on 4th of June 2018. So that takes the tax conversation out of 2018. But we can talk about it as a so-what? The things that were different in the results that we delivered is that we had a stronger portfolio – much more balanced than the competition has, providing for a bigger range of consumers, occasions and opportunities. We continue to invest in capacity in areas where we saw opportunities like spirits, one-way packs which speaks to occasions and trends that we are seeing. We did a lot to increase our distribution footprints and reach more consumers, on more occasions etc. We did a lot of work almost doubling the markets that we serve directly in 2018. So a combination of great portfolio, brands, the right costto-service and the expansion of the roads to consumer were the things that really brought the growth that we saw. What role did technology play in your financial year 2018, and what role do you see it playing going forward? The brewing industry is one of the oldest industries in the world. There is a lot of money that has been put into our manufacturing assets to

will be able to respond to the reality of the market. As you move into local sourcing you should also be able to use that material that you find in the market as the same level as if you have imported it. The rest of things we are doing are in the consumer marketing area.

upgrade them. So you will see that things that used to be manual are almost fully automated. We got a new investment that we just put in about 12.5 million pounds which is helping in us in PET and alcoholics. There are eleven women that are running that operation. If you ask me, five years ago, there could have been a 100 people. There is an increase in attention of the sophistication of our brewing packaging and operation. It does three things. It removes risk of human accidents; it delivers consistent quality, and it improves the global standards of the brands that we are bringing

to the country. Secondly, in the processes that we run in the organisation; we have a lot of backroom operations we run through the shared services centre. Whether in Bangalore in India or in Nairobi, you will see us shifting most of the manual work that we used to do, - everything from finance to payroll processing – all of that has now been fully automated, to self-serve technology, like how we settle our expenses,. We have moved off manual to platforms like that. When you look at the work load we did in Benin Brewery (we are going into spirits, we are putting a lot of investment

there), all of them are state-ofthe-art stuff that we are putting in there. We continually look for opportunities to serve those three purposes: Iconic global brands; brew them to the best international standards, remove risk to human health and safety, and make it easier and more standard. The final thing I will like to speak to is that as we go into sourcing of local materials, it also means you need a new way of using those materials to get the same results of product quality. So we have invested a lot of money in technology to be able to handle sorghum, for instance. Many other countries that we go to, they still struggle with it. The investment that has gone in there

How are you responding to the changing demography of your consumer base, with millennials becoming a dominant force? Nigeria is one of the youngest countries in Africa, so you are right. From the point of demographic spread you have a lot of teens who will become adults in the next four to five years. From a brand perspective, there are modules that we have internally, where we are able to figure out what is the trend. Trends show up differently, one is the area of palates. As a population becomes younger they tend to show up in different palate, so you have to recognize that and be able to position brands around that pallet. Secondly, there is a change in occasions which they interact with brands. For older consumers, they can meet with friends, maybe in a bar or over a celebration, which is changing. The way people are shopping from much more organized trade, the way they are using the brands in their homes with friends, occasions with music and entertainment, you need to understand and deliver both the liquid that answers that, whether it is a nonalcoholic occasion or it is an alcoholic occasion and the format. Some consumers no longer want bottles because of cockroaches coming into their houses. We have put in a lot of money in one-way packs because of a lot of people are becoming urban and they have smaller spaces and there is consumption on the go. There are trends that we observe with regards to wellness. People are more conscious about

their wellbeing and what they ingest so that could mean less sugar and lighter drinking occasions. You have to be able to respond to that sort of change. Our marketing team is always looking for what is the real trend we are seeing. How e ve r, o ne has to acknowledge the biggest driver of all these changes – there is always a conflict between aspiration and accessibility. I aspire to take the brands that I can, but is it something I can afford today? We always have to have the balance between real delivering aspirational brands for the young people as they become more global but you also have to be sensitive because they are light on the pocket, hence they should be able to afford the accessibility of these brands. We have quite a big range and we think that is our strength. We are still expanding in the beer category. In the nonalcoholics we have Orijin Zero, Dubic and we are working on many more things that you will be seeing coming through over the next twelve to fifteen months. What is the impact of the current state of the capital market on Guinness performance? When we observe what has happened over the past nine months, there has been a lot of pressure on the stock market. You have also observed that there has been a lot of pressure for many of the listed companies. I think that is only a symptom. The real issue is in the work that the government is doing to re-establish confidence that the recovery is real and that it is going to be sustainable. You know how investors operate; they put their money where they feel confident. I think if that confidence comes back you

will see the market coming back positively. Capital will follow opportunity, which is a general principle. The second bit will be with consumer confidence coming back, the impact on our business will be that as consumers start feeling much more confident, they will spend. The trick there for us is prepare yourself so that when the demand starts coming back, then you are prepared to serve the growth. If you ask me what are we doing about it? We will continue to invest. It is difficult, but we will continue to invest because we know this pressure will go away. We have seen it many times. We are commissioning one line and there is another line we will be commissioning in two weeks in Benin. So we are continuing to invest. How have you addressed the issue of logistics to get your products to every corner of the country given the poor infrastructure problem in the country, Is logistics a big challenge in Nigeria? The answer is yes. You should have read all published results in the last one week or two. The one line where everybody has demonstrated pressure was really intense has been on logistics, warehousing, and distribution cost, which has been going up. As the fuel prices come back, we rely on the transporters and they will charge you a bit more. Infrastructure side of the main cities is very difficult. The cost to serve per kilometre becomes higher. The spread of your manufacturing assets – how close are you to the market versus consolidating - that also has a part to play. On our part, we have been working hard to increase the

number of customers that we serve directly and that has almost doubled in the past twelve years. It has two reasons to do that, one is you get closer to the market and you are much more insightful which products are lacking in that region. We have also changed and restructured our commercial team to reflect an end-to-end business team per region. What we used to have was a bit disconnected. What that does is that all the decisions that are going to be made are given at regional level. I think that also helps to speed the execution and also to be more thoughtful around the logistics that you need to serve the demand that you see. We have moved a lot of brands

into one-way packs. We have invested in one-way-packs for Malta Guinness. It serves two things; one is the change in consumer lifestyle behaviour, so you are able to access the locations where people are on-the-go. The third thing that we are doing is to relook the whole portfolio and say “if I were to have one truck carrying 10 tons of Johnnie Walker,” for instance, the value of that is possibly equivalent to carrying 40 tons of beer. So there are areas you cannot find Satzenbrau because we have chosen that it is better for us to go into that space with Orijin Spirits or Malta Guinness etc. So we are careful about where we go, considering the opportunities and the balancing that needs to be done.

BUSINESS DAY

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

Year Open

38,243.19

Market capitalisation

N13.609 trillion

NSE Premium Index

The NSE-Main Board

NSE ASeM Index

2,564.13

1,713.69

1,087.32

Week open (02 – 11–18)

32,124.94

N11.728 trillion

2,339.62

1,416.86

786.19

Week close (09– 11–18)

32,200.21

N11.756 trillion

2,343.01

1,421.31

787.55

Percentage change (WoW) Percentage change (YTD)

0.23 -15.80

0.14 -15.89

NSE Lotus II

NSE Ind. Goods Index

NSE Pension Index

330.69

2,560.39

1,975.59

1,379.74

714.57

289.85

2,208.59

1,399.15

1,184.05

726.34

293.52

2,233.25

1,345.86

1,180.36

NSE Banking Index

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

1,746.68

475.44

139.37

1,443.81 1,447.79

419.29

121.92

417.33

119.60

NSE 30 Index

0.31

0.17

0.28

-17.06

-27.57

-17.11

0.47 -12.22

-1.90 -14.19

976.10

-1.65 -25.59

-1.27

-1.12

3.81

-0.31

-11.24

-12.78

-31.88

-14.45

More stocks show negative strength on Lagos Bourse IHEANYI NWACHUKWU

he Nigerian Stock Exchange (NSE) All Share Index (ASI) moved further into the negative region with a record year-to-date (Ytd) decline of 15.95percent as at November 12 trading day. The new dip became feasible as more equities joined the league of stocks that are showing red signs than the green. Looking at the year-to-date price change of many stocks, some of them have far underperformed the NSEASI and chief amongst them is Lafarge Africa Plc at N15 per share, representing 66.6percent decline when compared to its year-open price. The stock market has been responding to concerns over upcoming elections as well as the general risk-off sentiment for Emerging and Frontier Market assets. With the outlook for the Nigerian economy still relatively stable, many investment advisers are foreseeing a post-election equities market recovery. At 20kobo per share on Monday November 12, it shows Sunu Assurance Nigeria Plc has only this year lost 60percent of its share price. Also at 20kobo per share, Courteville Business Solutions Plc share price has decreased by 60 percent this year; same applies to Multiverse Plc at 20kobo (-60percent). Despite impressive third-quarter (Q3) numbers, stock prices declined in line with negative investor sentiment observed lately at the Lagos Bourse. With less than two months to year-end, the market may close this year on a negative note. Priced at 36 kobo per share, AG Leventis (Nigeria) Plc has lost 48.6percent of its year-open value. At N9.35 per share, Cadbury Nigeria Plc has declined this year by 40.3percent. Cornerstone Insurance Plc which stood at 22kobo per share has recorded Ytd decline of 56percent. Stocks that helped to push the NSEASI into the negative territory include

Dangote Flour Mills Plc with share price at N5.85 representing 51.9percent decline year-to-date. Other equities that have shown negative strength and their year-todate percentage decline are Wapic (-20percent); Zenith Bank (-6.4percent); Veritas Kapital Assurance (-46percent); Union Dicon Salt (-46percent); Unilever (-4.3percent); United Capital (-16.1percent); Union Bank (-37.8percent); UBA (-23.3percent); UACN Property (-42.7percent); UAC of Nigeria (-40.8percent); Transcorp Hotel (-15.4percent); Transcorp (-16.4percent); Trans-Nationwide

Express (-16.7percent). Total Nigeria Plc stock price has declined by 13percent this year; Regency Alliance (-56percent); Red Star Express Plc (-12.1percent); PZ Cussons (-55.6percent); Pharma- Deko (-35.6percent); Oando Plc (-17.4percent); Niger Insurance (-56percent); Neimeth (-20percent); Nigerian Breweries (-39.1percent); Mobil (-22.4percent); Me ye r ( - 2 1 . 4 p e rc e nt ) ; Mu tu a l Benefit (-54percent); Livestock Feeds (-37.3percent); Lasaco (-40percent); John Holt (-12percent); Julius Berger (-15.4percent); Japaul Oil (-58percent); Jaiz Bank (-23.8percent); International

Breweries (-38.4percent); and Honeywell (-48.6percent). Furthermore, Guinness (-21.3percent) has shown negative strength on the Lagos Bourse. GTBank (-10.4percent); GSK (-49.1percent); FTN Cocoa (-60percent); Forte Oil (-49.5percent); Flourmills (-43.1percent); First Aluminum (-30percent); Fidelity Bank (-20.3percent); FBN Holdings (-13.6percent); ETI (-7.6percent); Conoil (-19.6percent); Cutix (-9percent); Dangote Cement (-10.9percent); Dangote Sugar (-35.5percent); Diamond Bank (-22.7percent); Abbey Building (-18.5percent); Access Bank

(-25.4percent); Africa Prudential ( - 1 1 . 1 p e rc e n t ) ; B e r g e r Pa i n t s (-22.3percent); BOC Gas (-8.1percent); Chemical and Allied (-21.8percent); and Champion Breweries (-30.3percent). Analysts’ views Cordros Capital research analysts said: “Despite recent gains, we reiterate our negative outlook for the equities market in the short to medium term, amidst political concerns surrounding the 2019 elections, and absence of a positive market trigger. However, positive macroeconomic fundamentals remain supportive of recovery in the long term.” “Following a mild uptick in market performance in the prior week, we believe this buying interest will be sustained this week. Nevertheless, we expect profit taking to drag performance towards the close of the week”, said Lagos-based Afrinvest analysts in their November 12 note. “With the culmination of the thirdquarter (Q3) 2018 earnings season, we expect a mixed theme this week as issues around the polity remain in focus”, said United Capital research analysts. According to FSDH Research analysts, the performance of the equity market in the last six years shows that the market recorded positive performances between October and November in three of the six years. “Looking at the oversold position in the equity market, the equity market may appreciate in November 2018. While we note that some investors are trading carefully in the equity market, particularly because of election considerations, we believe the market has strong growth potential for investors with a mediumto-long-term view. “Investors can gradually enter the equity market through cost-averaging investment strategies. Investors should position in stocks that have good fundamentals. We see opportunities in the banking, consumer goods, food and beverages, building materials, and oil and gas sectors of the equity market. Investors can buy stocks that pay dividends”, FSDH Research analysts said in their recent report.

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United Capital investment views

Domestic equities recuperate, NSE-ASI up 0.2% week-on-week

he domestic equity index closed the week unscathed, recording a marginal 0.2percent w/w gain. Although the market opened the week on a dull theme and closed in the red on three of five trading days, the gains recorded midweek tilted in favour of the bulls. The All Share Index closed the week at 32,002.2 points while YTD return recuperated to -15.8percent. Likewise, market capitalization accreted N27.5billion to settle at N11.75trillion. Meanwhile, activity level strengthened as average volume and value traded rose 17.4percent and 11.8percent to 253.4million units and N4.1billion respectively. In other news, the Nigerian Stock Exchange lifted the suspension earlier placed on shares of five companies due to failure to file relevant financial accounts, they are Premier Paints Plc, Austin Laz & Company, Academy Press Plc, Ekocorp Plc, and FTN Cocoa Processors Plc. Sectoral performance was evenly mixed as three sector indices rose and declined concurrently. The Oil & Gas (+1.3percent), Consumer Goods (+1.6percent) and Agriculture (+5percent) indices closed higher as buying interests in SEPLAT ( + 6 . 9 p e rc e nt ) , UAC N (+11.1percent), NESTLE (+7.4percent) and PRESCO (+10.7percent) buoyed the indices. On the other hand, the Industrial Goods (-3.8percent), Insurance (-1.9percent) and Banking (-0.5percent) sector indices lagged w/w as declines in CCNN (-11.6percent), WAPCO (-14.3prcent), AIICO (-8.5percent), NIGERINS (-8.3percent), ACCESS (-7.8percent), WEMA (-5.2percent) and FBNH ( - 2 . 6 p e rc e nt ) o u t p a c e d the gains recorded in CAP (+3.3percent), DANGCEM (+0.05percent), L ASACO (+3.5percent), FCMB (+6.5prcent) and DIAMOND (+6.7percent). Meanwhile, market breadth a yardstick for gauging investor’s sentiment reflected a dampened theme as the ratio closed at 0.8x (previously 0.3x); 25 stocks advanced while 32 declined. With the culmination of the Q3-18 earnings season, we expect a mixed theme this week as issues around the polity remain in focus. Mon e y Market : CBN surprises markets with two OMO auctions Markets remained sufficiently liquid as OBB and overnight rates averaged 4.2percent compared to an average of 7.8percent in the preceding week. Liquidity was braced by inflows from the CBN which more than offset 305.2bn worth of fresh OMO bills that were issued by the bank after floating a total of 681.2bn against N 376b i l l i o n matur i t ies. Notably, two OMO auctions were conducted during the week – a divergence from the usual trend of the CBN. In the secondary market, players traded sentiments on expectations of OMO auctions at attractive yields,

as well as the unexpected by 2bps w/w to close at OMO auction. Consequently, N363.65/$1. Looking ahead, yields on benchmark Nigerian we expect the sustained Treasury Bill (NTB) papers weekly FX intervention by the inched higher by 23basis CBN to continue to support points (bps) on average to the local unit as demand pressures persist. Meanwhile, WEEKLY REPORT close at 13.7percent: 91-day (up 105bps to 13.2percent), the downtrend in global 1 8 2 - d a y ( u p 2 2 b p s t o crude oil prices, if sustained, a negative outlook 13.4percent) and 364-day portends STOCK MARKET REPORT FOR NOVEMBER 9TH 2018 (down 1bps to 16.8percent). for reserves. Global Market Review In this coming week, we and Outlook anticipate system maturities A total turnover of 1.079 billion shares worth N18.196 billion in 14,372 deals were traded this week Global equities mixed, toinvestors the tune of N552.1billion, by on the floor of the Exchange in contrast to a total of 1.267 billion shares valued at oil hovers around $70per split between OMOhands maturities N20.346 billion that exchanged last week in 15,088 deals. of N423.8billion and NTB barrel (/b) and Fed stands pat ratechart with 909.849 million maturities of Industry N128.2billion. The Financial Services (measured by volume) led on the activity equity indices shares at N12.765 billiontempo traded in 7,822 contributing 84.32% and 70.15% to the We valued expect the ofdeals; thusGlobal logged a mixed performance total equityevents turnover volume and value respectively. The Consumer Goods Industry followed with these to guide trading in thethirdprevious In the 52.651 million shares worth N3.342 billion in 2,876 deals.The place was Oil week. and Gas Industry sentiments through the week. with a Bond turnover ofMarket: 36.318 millionLull sharestheme worth N674.243US million in 1,324 deals. market, the outcome of the midterm congressional guides trading sentiments Trading in the Top Three Equities namely Zenith Bank ePlc, l eAccess c t i oBank n sPlctand h aFBN t Holdings s aw Plc, the A cautious theme directed (measured by volume) accounted for 557.380 millionDemocrat shares worth N9.434gain billion in majority 3,231 deals, trading sentiments in the contributing 51.66% and 51.85% to the total equity turnover volume and value respectively. bonds space on the backdrop control of the US House of of some uncertainty on the Representatives and the Equity Turnoverof - Last 5 daysoff the week Republicans the US Senate direction yields with a spike in yields which impacted market sentiments. came on the back of some Additionally, the Fed left rates unchanged at its Turnover Traded Advanced Declined Unchanged offshore sell-off. Overall,Turnover FGN policy Date yields Deals edged Volume higher Value (N) penultimate Stocks Stocks meeting Stocks in Stocks 2018 bond 3,134 average 157,834,915 to 1,750,793,178.88 17 24 58 5-‐Nov-‐ 18 on a continuation by 9bps close but99 signalled ov-‐18 3,063 149,653,300 2,793,474,772.47 23 rate hikes. 67 further14 gradual at6-‐N15.5percent, driven by of104 7-‐Nov-‐18 2,858 450,139,900 9,398,636,273.12 102 17 the DJIA, 67 of18 all these, increases in maturities 2034 Amidst 8-‐Nov-‐18 2,639 2028 200,131,887 2,672,680,834.35 S&P 104 500 and 19 NASDAQ 15 70 indices (+14bps), (+14bps), 9-‐Nov-‐18 (+14bps) 2,678 121,260,461 105 3percent, 18 19 68 and 2.1percent 2027 and1,580,724,249.27 2030 rose (+12bps). Also, average yield 0.9percent w/w.

for FGN Eurobond inched higher by 15bps to settle at For Further Inquiries Contact: Market Operations Department 7.5percent while average yield in corporate Eurobonds edged lower from 14.7percent from 10.3percent. Looking ahead, we expect proceedings to be bullish as investors take advantage of the yields uptick. Foreign Exchange: Pressure on Dollar reserves slows amid rising yields In the Foreign exchange market, the performance of the local currency a g a i n s t t h e U. S d o l l a r was in line w ith recent narratives, closing mixed across market segments. The CBN sustained its weekly FX intervention in the wholesale and retail FX market. Accordingly, FX reserves eased marginally 0.3percent w/w to $41.8bn as at We dnes day as p re s su re s o n F X s e e m s to be dissipating on the back of rising yields in the environment. Meanwhile, b e n c h ma rk B re nt p r i c e breached the $70/b support level on Friday, less than a month after touching a record high of $86/b. In line w ith this, F X rate at the Parallel and Official market depreciated by 14bps w/w and 2bps w/w to close the week at N361.5/$1 and N306.65/$1 respectively, while NAFEX rate appreciated marginally

I n E u ro p e, t h e U K ’s Office for National Statistics Page 1 reported that the country posted its fastest quarterly growth in almost two years of 0.6percent in Q3-18. Although, there are concerns over loss of momentum going forward, due to uncertainties surrounding BREXIT negotiations. Consequently, the Pan European STOXX (+0.6percent), UK’s FTSE (+0.2percent) and France’s CAC (+0.2percent) all trended northwards w/w. Emerging markets equity indices were mixed in the prior week. The Brazilian IBOV (-3.4percent), China’s SHCOMP (-2.9percent), South Africa’s JALSH (-1.8percent) and Russia’s RTSI (-1.2percent) trended southwards w/w while the Indian SENSEX (+0.4percent) index closed the week in the green zone. No t w i t h s t a n d i n g t h e take-off of US sanction on Iran at the start of the week, benchmark Brent price fell into a bear market during the week, breaching the $70/b psychological level. This can be attributed to the waivers granted by the US to key importers of Iranian oil – Japan, India, Turkey, Taiwan, South Korea, and China – while the effect of the sanction on global supply is expected to be largely offset by a pickup in output by Saudi Arabia and Russia.

Investor’s Square •Have you been shabbily treated by your registrar, stockbroke r or other capital market operators? Let us know and investor will help you investigate and report back. E-mail: iheanyi.nwachukwu@businessdayonline.com

Passive investment flows vital for African capital markets –LSEG report

mong the key findings in a recent report by the Africa Advisory Group of the London Stock Exchange Group (L SE G) is that passive investment flows are key to supporting depth of African capital markets. Pa s s i ve i nve s t m e nt funds track the performance of a financial index, with a longer-term view of receiving a return by following the upward trend in the market. Exchange-traded funds (ETFs) and index funds are the main investment i n s t r u m e nt s u s e d f o r benchmarke d passive investing. Introduced 25 years ago, ETFs are now one of the fastest-growing asset types in the financial markets, with a cumulative aggregate growth rate in assets under benchmark (AUB) of 18.9percent over the past decade. As of March 2018 assets under management ( AU M ) i n E T Fs a n d exchange traded products (ETPs) globally stood at $4.9trillion, invested across more than 5,000 ETPs on more than 70 different exchanges in 56 countries. “It is crucial that local regulators promote an investing environment that will combat illiquidity and high transaction costs,” the report notes. In comparison with active net inflows, the last five years have seen a gradually shifting trend to more passive investment

strategies in Emerging Markets. Major reasons for this significant trend towards passive flows include: passive strategies require a fraction of the management fees required for active investing, leading to higher net returns. The following challenges were identified as hindering passive flows into African markets: lack of understanding among African stakeholders around the benefits of a country classification upgrade; high transaction costs and insufficient levels of liquidity; limited re s e a rc h c ov e ra g e o f African equities, leading to unfamiliarity among global investors. Based on these challenges, the following recommendations were suggested: engage with a n i n d e x p rov i d e r i n upgrading market status by following a framework that tracks and fosters ma rke t d e v e l o p m e nt ; regulators should adopt supportive legislation; enhance international ma rke t i ng ca mp a ig n s to raise awareness; and develop a deeper domestic institutional equity market. Many African equity markets are dominated by individual retail i nv e s t o r s. W h i l e t h i s creates an important sense of democratised capital and wealth distribution, it actually curtails the flow of international institutional capital, which seeks out markets influenced by

the behaviour of other institutional capital managers adhering to similar investment discipline and stewardship codes. This restricts the growth potential of African markets. Development of a d e e p mu t u a l f u n d s market creates a stronger institutional market, increasing the propensity of crowding in overseas institutional capital mutual funds. There are added peripheral benefits related to increasing savings rates and deepening financial inclusion in certain countries. The reports recommends that government should consider strengthening its international reputation through external marketing of the domestic market, such as carrying out global roadshows and capital markets days and promoting the issuance of more sovereign instruments overseas. This will help to increase the international investment community’s familiarity with the country. LSEG last week launched five reports on different aspects of capital market development. The reports address five key topics: developing the green bond market for infrastructure products ; attracting passive investment flows; developing offshore local currency bond markets; capital raising challenges for SMEs and; corporate information dissemination.

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Vetiva Research

Vetiva reaffirms ‘buy’ rating for Dangote Sugar stock IHEANYI NWACHUKWU

etiva Capital Management Limited in its most recent earnings review of Dangote Sugar Refinery Plc evaluated the earnings performance of the company as seen in the nine months (9M) 2018 financial statements. Speaking on the report, the consumer goods analyst at Vetiva, Ifedayo Olowoporoku stated that “Dangote Sugar Refinery released its 9M’18 results showing a 28percent year-on-year (y/y) revenue decline to N116.8 billion. “The topline performance was impacted by sustained influx of lower quality unlicensed sugar smuggled into the country as well as deterioration in the Apapa traffic gridlock which continued to hamper evacuation and distribution of finished

products from the refinery”. Nonetheless, the report showed that DANGSUGAR reported 9M’18 profit after tax (PAT)ofN16.7billion,translating to a 14percent net profit margin – above peer average of 11percent in the same period. Ve t i v a h a s r e v i s e d its estimates and stated expectations for the rest of the year. Quoting from the report, “Despite the more c o m p e t i t i v e o p e ra t i n g environment, we expect DANGSUGAR’s volumes to improve 20percent quarteron-quarter (q/q) in Q4’18 supported by the seasonal boost from the festive season”. Driven by this, our FY’18 PAT figure is revised to N23.6 billion and our 12-month target price comes to N21.46, a 65percent discount to current price –affirming our BUY rating on the stock. DANGSUGAR currently trades at a FY’18 P/E of 7.1x and dividend yield of 7.0%

Market news in brief CISI, NSE new deal seen boosting finance professionals in Africa

he Chartered Institute for Securities & Investment (CISI) has entered into a new partnership with the Nigerian Stock Exchange (NSE) to provide training for CISI’s qualifications in Nigeria, under the auspices of X-Academy, the knowledge platform of NSE. The partnership will result in CISI accrediting X-Academy as its training partner in Nigeria for qualifications including the International Introduction to Securities & Investment (IISI), International Certificate in Wealth & Investment Management and Certificate in Derivatives. X-Academy will be offering both face-to-face and online training for these qualifications. The CISI is the 45,000 strong, global not-for-profit professional body with members in over 100 countries. It has been working in Africa since 2012 offering exams and membership across the continent, with regulatory approval for its examinations in eight countries. It opened its first African office in Kenya in June. Over the last 18 months, almost 3,500 CISI examinations have been sat in Africa, making it CISI’s fastest growing market. The CISI is an Associate Member of the Africa Securities Exchanges Association (ASEA) in a partnership which aims to promote professionalism

and develop channels for capacity building and knowledge sharing to support the growth of the capital markets profession in Africa. Helena Wilson Chartered MCSI, Assistant Director, CISI Global Business Development said: “We are delighted to partner with The Nigerian Stock Exchange to provide training for CISI’s internationally recognised qualifications in Nigeria, supporting the development of human capital within the fast-growing Nigerian capital markets. CISI qualifications are fast becoming a benchmark across Africa, and this partnership is symbolic of Nigeria’s growing influence both within Africa and on the global stage.” Pai Gamde, Chief Human Resource Officer of NSE, said: “This partnership is a testament to the years of investment we have made in pushing the boundaries of financial education and stimulating investors’ participation in the Nigerian capital market. In 2017, we launched X-Academy to offer our ecosystem a blended learning approach and the curriculum across CISI programs reflects the same intent. We are quite excited about this development and we look forward to a long lasting relationship with CISI”.

(FY’18E DPS: N0.98). Ifedayo further stated, “We highlight that most of the challenges facing DANGSUGAR in the current financial year are more external with respect to the Nigerian operating environment. While these factors should be transient in nature, efforts to curtail

the smuggled sugar by government authorities as well as improve traffic flow in the Apapa axis have yielded very dismal results and we are less optimistic about the timeline for i m p rov e m e nt i n t h e s e conditions. Nonetheless, the company has noted its independent efforts to

bypass these impediments, with Management stating new initiatives to explore water ways for product logistics. Meanwhile, we note the possible upside for domestic sugar prices in the near term given recent uptick in global sugar prices, up 25percent quarter-to-date (QTD)”.

Nigerian Bourse records N2trn worth of stock deals in 9 months

rom January to September, the cumulative transactions on the Nigerian Stock Exchange (NSE) increased by 21.23percent to N2.007 trillion in 2018 as against N1.655 trillion recorded in same period of 2017. Total transactions at the nation’s bourse reduced by 2.79percent from N133.84 billion recorded in August 2018 to N130.20 billion (about $425.6 million) in September 2018. Foreign investors outperformed Domestic investors by 29.54percent in September 2018. Total foreign transactions increased by 18.82percent, from N70.97 billion in August to N84.33 billion in September 2018. Foreign outflows increased by 27.60percent from N34.31 billion to N43.78 billion whilst foreign inflows increased by 10.58percent from N36.66 billion to N40.54 billion over the same period. There was a significant decrease of 27.03percent in total domestic transactions from N62.87 billion in August 2018 to N45.87 billion in September 2018.

Stockbroking Houses in new move to improve capacity, others

he Ass ociation of Stockbroking Houses of Nigeria, (ASHON) in an exploratory move, is seeking partnership with a leading Mauritius based Information and Communications Technology ( ICT) Company, Acoyvis Limited. The foreign ICT firm has proposed an international workshop for ASHON to address the global best practices in technology governance and the need to enhance oversight functions of board members of Stockbroking firms and bring them closer to the staff in the back office for harmonious operations. Specifically, Acovyis, adjudged as one of the leading companies in ICT training has proposed a comprehensive training programme for board members of Stockbroking firms and back office staff in line with the global best practices in technology governance and oversight functions. If endorsed by A S H O N, t h e p ro p o s e d series of joint workshops will address a wide range of issues that will strengthen international competitiveness of its members.

Addressing ASHON’s Executive members, the exploratory meeting, Acoyvi’s Chief Executive Officer, Susanne Alfs, stress e d the essence continuous training of board members and back office staff to upscale their skills in view of frequent challenges in ICT architecture. She explained that distruptive trends in the ICT world have brought into fore the imperative of acquisition of latest skills in technology. “With technology invading even the remotest corner of our organizations, it is also moving up a few notches on a typical board agenda. But in the past, technology knowhow was not typically sought after in board members. That is why many boards today struggle to keep up,” she said. Responding, ASHON’s Chairman, Patrick Ezeagu, described her presentation as a management change that every board must embrace. Ezeagu note d that the presentation has re-opened the on-going discussion on the fourth revolution and the need for every professional to be prepared for a change.

Present in the meeting were the first Vice Chairman of ASHON, Akin AkeredoluAle, Second Vice Chairman, Sam Sam Onukwe, Council Member, Ify Ejezie, Treasurer, Bunmi Ajayi, and the General Manager, Business Development and Corporate Services, Central Securities Clearing Systems Plc, Joseph Mekiliuwa. “You have talked about the fourth revolution which is going to disrupt a lot of things in terms of how to do business. People are going to have less margins while many may lose jobs except they upscale their skills. “Therefore, I believe that there would always be a place of collaboration for like minds, and I can tell you that the Council members shall deliberate on what have been said and arrive at a consensus on the areas to collaborate with Acoyvis”, Ezeagu stated. He explained that stockbrokers in Nigeria were resilient as they operate in an environment characterized by market volatility, frequent changes in technology and high cost of its acquisition, unstable government policies and uncertainty in the economy following

unguarded utterances of the political class, causing panic among investors. Ezeagu also noted that ASHON’s members are in support of the ongoing demutualization of The Nigerian Stock Exchange but they are also interested in how the demutualizes market will impact their businesses. Commenting on the challenges facing Stockbrokers in Nigeria, Alfs stated that many of them were technology based. She urged ASHON’s members to acquire technology skills saying the pace of velocity change will increase into the future. “But also, the Nigerian government should work on its reputation and increase the capital inflow to have a higher liquidity in the market to achieve a more positive outlook”, she said. Only recently, ASHON in an advertorial advised the political class to guard against unguarded statements that are heating up the polity. The Association was prompted by continuous slide on the exchanges in Nigeria following dumping of shares by foreign investors who are apprehensive of likely crises in the 2019 general election.

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Feature Shoring up tax revenue to GDP Nigeria’s tax revenue at about (6) per cent to GDP is low compared to other countries and it is hampering (Nigeria’s) development. This prompted a recent discussion on ‘Leveraging Domestic Resource Mobilization for Sustainable Development’ by NESG on how to increase tax revenue. Tony Ailemen writes.

igeria’s current poor revenue outlook and its negative consequences on government spending and the need to shore up tax to GDP, formed the fulcrum of a recent fiscal policy round-table, hosted by the Fiscal Policy Commission of the Nigeria Economic Summit Group NESG, in Abuja. Issues identified at the event include, absence of reliable data for planning, poor tax to GDP revenue at 6%, low income from taxation, high level of tax evasion, lack of public confidence on government’s ability to effectively utilize tax proceeds to provide infrastructures and very high debt service costs, relative to income generation. Experts at the forum who spoke on “ Leveraging Domestic Resource Mobilization for Sustainable Development” called for a strong innovative thinking on how to shore up revenue base to enhance sustainability, using fiscal policy measures to improve the revenue from both oil and non-oil sector. They see this as critical to sustainably financing Nigeria’s development programs and long term macro-economic stability. Sarah Alade, Chairman of Gates Foundation who supported NESG Fiscal Policy Roundtable traced Nigeria’s inability to fully implement the Millennium Development Goals MDGs agenda to halt poverty, to poor resource mobilization. She called for “intensification of domestic resource mobilization in Nigeria, like other African countries to achieve sustainable development” Nigeria’s economy had over the years suffered from low revenue mobilization, despite high spending needs, with large overall fiscal deficit and pressure on debt services which hovers around 46% of revenue generated The experts see government spending on Infrastructures further shrinking at the current level of tax total revenue to GDP of about 6%, from both oil and non- oil sector, unless strong efforts are put in place that will push tax to GDP revenue up to over 15%, between 2018-2020. Nigeria’s tax-to-GDP ratio is

also considered to be very low relative to peers. A tax revenue to GDP of 6 % is one of the lowest with an Africa average put at approximately 23%, indicating that Nigeria’s revenue to GDP is just one third of the continent’s average. The need therefore to increase revenue by governments at both national and sub national levels becomes inevitable through various sources, including excise duties, amongst others. Doyin Salami, Co-Chair and Resident Commissioner, Fiscal Policy Roundtable, gave reasons for the focus on issue of “fiscal governance”, saying that Nigeria was moving close to “ an unsustainable level in terms of its fiscal arrangements” Defining Fiscal governance as the embodiment of “ rules, regulations and procedures that influence how government policies are planned, approved, implemented, monitored and evaluated”, he lamented that the country’s debt service to revenues was becoming “ unsustainable” at close to 46%. “In the face of falling revenues, the country is also burdened by the increasing need to raise expenditures, making it obligatory for Nigeria to triple its revenue base to drive improved revenue performance and likely match the Africa average of 22%. Speaking further on the issues of taxation, Salami revealed that while between 1 to 3% of the top productive population

in other countries pay anything between 50 and 75% of the tax revenue, the reverse is the case in Nigeria. “When l speak on fiscal governance, it is not just at the federal level, while there may be macro data, there is certainly no micro data. Our preliminary research suggests to us that the tax collectors do not really know who the customers are. We don’t have data about households, corporates and even sectors. All of these make it very difficult to get budget or fiscal governance into any meaningful shape” “There is need to begin to take a look at various kinds of opportunities and reforms. Yes, a lot has been said of the reform of VAT as Nigeria today maintains one of the lowest global VAT rates. In some countries, when you look at the GDP from the consumption or expenditures sides, between 50 and 60% of that consumption expenditure is Vat-able, In Nigeria, again, it is much lower than that. We however need to be careful here, and evaluate how effectively the country has implemented the current VAT arrangements. “So, you may begin to say, should we raise the rate and keep the same number of vatable goods and services or should we expand the range of goods that are vat-able and keep the rates at the current levels. There have been suggestions around creating a luxury rate. In my view there are also chalkboard around how you can

implement that. Indeed, there are some countries where they have brought down other taxes in other to raise the VAT. You must look at a basket of taxes.” He continued “In a system where patronage is a way of life, the people who you ought to be pursuing are left out while we go after the lower income earners. It is time for Nigeria to focus its tax strategy on the top 3%. This is not a Nigerian creation; In the United States of America, it is the top 3% that are responsible for almost 60% of the tax revenues. The important question therefore is, who are the top of our own income pyramid paying taxes? “ “If they are not, what do we do about that. It is the tax collectors who should go after the big men, but the big men get exemptions because they have the connections to call whoever can keep the tax people off their backs” In his submission, Amine Mati, the Senior Resident Representative of the International Monetary Fund IMF, called for a review of the current Value Added Tax, VAT, rationalization of tax incentives, as well as reductions in Customs duty waivers. While recognizing that government has set a revenue target of 15% through the Economic Recovery and Growth Plans (ERGP), Mati sees this realizable on implementation of certain measures which include, review of its revenue administration,

tax policy, amongst others. “ So, what are the options, there are several, but the one, l want to focus on is the excises and the potentials” He said Nigeria revenue base can be improved through review of excise duties such as those on consumption, smoking, drinking, gambling, fossil fuel consumption, pollution and motoring. Whereas government before 2009 used to apply excise duties to a wide range of products that yielded huge revenues, at the moment excises are only applied to products such as tobacco and alcohol. He said excises despite being one of the easy sources of revenue to get, at the moment only bring 0.1% of the GDP to Nigeria as against 3% and 6.4% for ECOWAS countries and Turkey respectively. Mati’s recommendations were based on the premise that since Excise Duties do not necessarily require legislations, government can increase revenue base using executive orders, making it an easier tool to boost revenue. Mati also sees low tax collection rates as a direct reflection of perception of weak service delivery by taxpayers and weaknesses in revenue administration. The speakers identified that Nigeria does not have a modern consumption VAT rate at the moment, as the current setup disallows input credit on capital goods and services (de facto, taxing investment and possibly explains why companies ask for VAT exemptions and other tax incentives under the CIT system. Johnson Chukwu, MD Cowry Assets Limited, speaking on the implications of the low tax to GDP ratio, said “government will find it difficult to fund the budget and will have to rely a lot on borrowing” He posited that government needs to improve on the ease of payment to enhance compliance and voluntary payment, as well as strengthen its level of enforcement and evaders should be severely punished. According to him, “government must be responsive to its civic duties to the public so that the citizens will have a compelling conviction to meet their obligation of tax payment as a result of the governments ability to execute social projects”

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LegalBusiness BD Business Law Industry Report Practice Intelligence Partnerships

INSIDE Facts and arguments on tax deductibility of gas flaring payments

Lawyers, others confident AfCFTA would be signed sooner than later Theodora Kio-Lawson

26 Post NBA election conflict: Court grants Obi Okafor’s prayer

26 DOA wins more at the Nigerian Legal Awards

27 Ojukwu calls out national judicial service commission

he Chairman of the Nigerian Bar Association Section on Business Law (NBA-SBL), Seni Adio, SAN has expressed optimism that the African Continental Free Trade Area Agreement (AfCFTA) would be successful signed in the nearest future. Seni who was recently inaugurated into the presidential committee for Impact and Readiness Assessment of the Africa Continental Free Trade Area (AfCFTA), by President Muhammadu Buhari, spoke at the Africa Trade Forum 2018 in Lagos, Nigeria. Adio, who spoke exclusively to BusinessDay Law Editor, stated that he was confident that the impact and readiness assessment committee, whose report is due in nine weeks, would make a good case for the signing of the AfCFTA. He thus, urged legal practitioners to stay at the forefront of ongoing reforms, as the AFCFTA is expected to open a new vista of opportunities not just for practitioners in the area of trade law but for all lawyers. Also speaking at the forum, Joy Kategewa, Africa Regional Office head, United Nations Conference on Trade and Development, disclosed that for the AFCFTA to work, all stakeholders must give some serious thought to how Intra-Africa trade can positively affect Foreign Direct Investment. She said, “The sort of investment that will make the AfCFTA significant is one that gets us to build capacity

Photo of His Royal Highness, the Prince of Wales unveiling medallion marker of the Commonwealth walkway with Olasupo Shasore SAN, Chair of the Nigeria Commonwealth walkway Committee. The walkway will be the first in Africa and will be a 20 location - 5 km route through Lagos Island to promote a sense of place, encourage interest and awareness in few selected cities and link the whole Commonwealth together

and scale up Intra Africa trade. Policy must work with skill and at the same time with enterprise.” Hippolyte Fofack, chief economist and director, research and cooperation department, African Export Import (Afriexim) bank, spoke of the banks faith in the AfCFTA, noting that through it, the AU has given purpose to young Africans who aspire to greatness, as it deals with Africa’s biggest challenge - trade financing. “Afriexim Bank greatly believes in the AfCFTA. We believe that it is the most important thing happening in Africa. It is no longer theoretical or hypothetical. It is now real,” Fofack said. Continues on page 26

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BDLegalBusiness

Facts and arguments on tax deductibility of gas flaring payments TAXAIDE

n two recent decisions, the Federal High Court (FHC) decided that gas flaring payments are not tax deductible. In this note, we have set out below the relevant facts, arguments, basis of the decisions and the consequent impact of these decisions on Gas Producers. Federal Inland Revenue Service v Mobil Producing Nigeria Unlimited (FHC/L/3A/2017) This was an appeal by the Federal Inland Revenue Service (FIRS) on the decision of the Tax Appeal Tribunal (TAT) on the grounds that the TAT erred in law when it held (amongst other things) that the Petroleum Profit Tax Act (PPTA) and the Associated Gas Re-injection Act (AGRA)do not expressly require a company to obtain Gas Flare Certificate before it can categorize its gas flare payments as tax deductible. The FIRS argued that gas flare payments were not charges for gas flaring but penalties for flaring gas and are not tax deductible under the PPTA and the AGRA. The FIRS argued further that a penalty paid for carrying out an action or failure to carry out an action as the case may be, does not fall under expenses incurred wholly, exclusively and necessarily for oil operations. On the other hand, Mobil contended that gas flaring payments are not penalties as contemplated by the FIRS by virtue of Section 4 of the AGRA which provides that the penalty for gas flaring without approval of the Minister of Petroleum Resources is forfeiture of the concession granted to a company and not the payment of any sum. Hence, gas flaring payments cannot be regarded as penalties. In reaching a decision, the FHC recognised the fact that gas flare payments fell under the scope of tax deductible expenses under Section 10(1)(L), however, the FHC held that

every oil and gas production company is under an obligation to apply for and obtain the written permit/ consent of the Minister before flaring gas. Therefore, lack of a written permit to flare gas is in contravention of the AGRA, thus, gas flare payments are “illegal payments” which should not be tax deductible. Federal Inland Revenue Service v. Shell Petroleum Development Company of Nigeria Limited (FHC/ L/1A/2017) This is also an appeal by the FIRS against the decision of the TAT that gas flare payments do not constitute penalties instead they are royalties paid for gas flaring. Shell made some payments to the Department of Petroleum Resources to flare gas in the 2006, 2007 and 2008 Years of Assessment (YOAs) and treated same as deductible expenses in its returns for the YOAs. The FIRS disallowed the deductions and assessed Shell to additional tax for the reason that the gas flaring payments were penalties because Shell was not issued a certificate by the Minister of Petroleum to flare gas as contained in the provisions of the AGRA. The FHC in reaching a decision held that the TAT acted ultra vires by substituting gas flare payments from penalties to royalties. The Court further decided that gas flare payments

are not within the category of expenses incurred wholly, exclusively and necessarily for petroleum operations and as such are not tax deductible. IMPLICATIONS Pending a contrary decision by the Court of Appeal, the position of the Court is that gas flaring payments are not tax-deductible expenses. As can be seen from the foregoing decisions of the FHC, there is the likelihood that the Court may have reached a different decision in the event that the relevant Gas Producers were able to show gas flare certificates and or permits approving the gas flared. In light of this,as a short-term strategy to mitigate potential exposure with regards to the ability to claim gas flare payments as tax deductible expenses, it may be necessary for Gas Producers to ensure that they obtain gas flare certificates issued by the Minister. A long term and sustainable approach may be for Gas Producers to minimize gas flaring either through deliberate gas utilisation or having arrangements with gas utilisation companies in order to reduce or eliminate gas flare payments.

Oyeyemi Oke and Gabriel Aiyeetan are of TAXAIDE.

GLOBALREPORT

Top U.S. law firm announces all women class of new partners

op U.S. law firm, Cravath, Swaine & Moore LLP has announced its new class of partners – a set comprising only of women. Reports have it that, it isn’t the first time Cravath has had a diverse partnership class. In 2016, the attorneys elected to the partnership were also all women, but with another impressive slate of women joining the ranks of partner, it is clear the firm’s commitment to integrating women into the top levels of the profession is priority. The list of soon-to-be partners include, Lauren Roberta Kennedy is a graduate of Columbia Law School. She practices in the firm’s litigation Department, with focus on general commercial litigation matters. Sasha A. Rosenthal-Larrea also got her J.D. from Columbia Law School. She’s a corporate lawyer with a speciality in capital markets matters. Allison M. Wein

went to Northwestern University School of Law. Her practice is in the corporate department with a focus on mergers and acquisitions. In her remarks, the firm’s presiding partner, Faiza Saeed (the first woman to lead Cravath), spoke in support of this move. She said, “Lauren, Sasha and

Thursday 15 November 2018

Allie have done tremendous work for our clients and are highly skilled and talented lawyers,” Saeed said of the promoted attorneys. “They are active in the Firm’s diversity efforts, including our Women’s Initiative, and each has been involved in student recruitment and associate mentorship as well.”

Lawyers, others confident that AfCFTA... Continues on page 25

He further disclosed that the Afriexim bank was now focused on working with young African entrepreneurs to develop bankable projects around the continent. Also dwelling on the challenges and gaps in trade financing across Africa, Ambassador Albert Muchanga, United Nations Commissioner for Trade spoke of ‘Agenda 2063’. According to him, Agenda 2063 is a ten-year deliverable plan that can be achieved successfully with the implementation of the AfCFTA. The 2018 Africa Trade Forum hosted by Nigeria’s Ministry of Industry, Trade and Investment, and coorganised by the United Nations Economic Commission for Africa (ECA), The Rockefeller Foundation, and the African Union Commission (AUC), brought together key stakeholders from across the continent - political and governance spheres; private and public sector; entrepreneurs, philanthropists; academia, researchers, and development partners, to discuss the process for realizing the African Continental Free Trade Area (AfCFTA). The AfCFTA was signed in March 2018 by 44 African countries and, if ratified, will become one of the world’s largest trading blocs. It is also the biggest trade agreement signed since the World Trade Organisation (WTO) was established, bringing together 1.3 billion people with a combined gross domestic product (GDP) of more than $2 trillion in a single market. The agreement aims to provide improved competition and lower business costs. BusinessDay recalls that the Chairman of the Nigerian Bar Association Section on Business Law (NBA-SBL), Seni Adio, SAN along-

side other critical stakeholders, were on Monday October 22, 2018 inaugurated into the Presidential Committee for Impact and Readiness Assessment of the Africa Continental Free Trade Area (AfCFTA). The committee charged with the responsibility of identifying short, medium and long-term measures to prepare Nigerian businesses for the take-off of the AfCFTA trading bloc; review the trade remedy options to safeguard the Nigerian economy from predatory and other unfair trade practices, is expected to submit its reports in 12 weeks. The NBA-SBL since its annual business law conference in June 2018, where it provided a platform for stakeholder consultation on the endorsement of the African Continental Free Trade Agreement (AfCFTA), has continued to engage with the Nigeria Office for Trade Negotiations and other relevant stakeholder towards the signing and implementation of the AfCFTA. The annual business law conference resolved that bar associations and large law firms in Africa with the support of their governments, must position the legal profession to maximize the benefits of free trade by seizing the initiative to reorganize the profession and guide the inevitable disruption to the profession that will be enabled by the AfCFTA, artificial intelligence and local competition by global law firms. It was also agreed that the Section on Business Law should deepen the understanding of trade law within Nigeria by establishing a specialist Trade Law Committee within its organisation and facilitate training seminars on international trade law and negotiations for public and private sector lawyers.

DOCKET Post NBA election conflict: Court grants Obi Okafor’s prayer

ustice Olukayode Adeniyi of the Federal High Court sitting in Abuja, on Tuesday granted the prayer of Arthur Obi Okafor, SAN, a contestant in the last Nigerian Bar Association (NBA) elections, for the amendment of his originating summons and written address in support, filed against the Incorporated Trustees of NBA and 36 others. The trial judge resolved to confirm the status of the case, whether indeed the Hon Chief Judge approved the application for the matter to be heard as fast-track proceedings pursuant to Order 37 of FCT High Court Civil Procedure Rules 2018, as conveyed to the Court by J.S. Okutepa, SAN, who conducted proceedings with the leave of Ikechukwu Ezechukwu, SAN, who himself, Okutepa, SAN, and 10 other legal Practitioners. Arthur Obi Okafor also confirmed that they have already made moves to effect service of the processes through DHL to the 6th and 7th Defendants, adding that, they have served the 1st to 3rd, 4th, 5th, and 8th to 23rd defendants. The NBA President, Paul Usoro, SAN, in response to the originating process, as 4th defendant, filed a motion to enter conditional

appearance which was granted by the court as prayed, after the claimant was given two days to file and serve the amended processes to the affected parties. It would be recalled that Arthur Obi Okafor, SAN, had gone to court to challenge the declaration of the election results by Electoral Committee of the NBA (ECNBA) and the swearing-in of Paul Usoro, SAN, as winner of the election without a post-election audit.

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BUSINESS DAY

INDUSTRYFILE

LegalBusiness

DOA wins more at the Nigerian Legal Awards

fter its Big win at the Law Digest Awards, DOA has remained in the league of winners, as once again it carted away top categories at the recent Nigerian Legal Awards. The Firm was nominated for the following awards, Corporate Commercial, Banking and Finance; Private Equity, Energy and Power; Telecomms and Technology, Real Estate and construction, Law firm of the year Mid-size practice; and Young Managing Partner of the year. The Firm won the awards, Corporate Commercial team of the year, Telecomms and Technology of the year, Young Managing Partner of the year which was won by our Managing Partner Adeniyi Duale; Also two of its Partners, Soibi Ovia and Adeleke Alex-Adedipe picked up the rising, 40 under 40

awards which recognises excellence under lawyers under the age of 40 years. In this photo, Managing Partner, Adeniyi Duale and other other members of the DOA team are seen receiving the award from pioneer Chair of the Section On Business Law, George Etomi.

THE BUSINESSOF LAW

Ojukwu calls out national judicial service commission

…insists that appointment of judges must be transparent Theodora Kio-Lawson

enior advocate and former aspirant to the office of the president of the Nigerian Bar Association (NBA), Prof Ernest Ojukwu, SAN has called on the National Judicial Service Commission to see that judges are appointed in an open and transparent process. Ojukwu who made this call on Tuesday in a statement to the media, claimed that the current Notice of Appointment of additional Judges at the National Industrial Court does not meet Transparency Threshold He cited the recent NOTICE by the President National Industrial Court of Nigeria (NIC), on the appointment of 20 additional judges for that Court as not meeting the transparency threshold. “It actually offends the NJC Rules,” he said. “There was need for the Judicial Service Commission to do the right thing. Let us have our The Notice in question, dated 31st October 2018 advertised that the Chief Justice of Nigeria “has GRACIOUSLY given His approval for the commencement of the

process that will lead to the appointment of twenty (20) additional judges for the National Industrial Court of Nigeria” and goes on to state that: “All interested persons are advised to act accordingly”. Note that, The National Judicial Council (NJC)’s Procedural Rules requires that: (i) There shall be “call of expression of interest by suitable candidates by way of public notice placed on the website of the Judicial Service Commission/Committee concerned, notice boards of the courts and notice boards of Nige-

rian Bar Association Branches; (ii) The Judicial Service Commission/ Committee shall specify the closing date for the receipt of applications and /or nominations in the call of expression of interest….” Ojukwu thus queried: “What does the “Notice” require interested candidates to do? “Act accordingly”? How? He continued, “There is no notice relating to the appointment of additional judges of NIC on the website of the National Judicial Service Commission or on any NBA website. The NIC Notice does not have a deadline for expression of interest; it does not state qualifications. It does not direct any interested person on what to do whatsoever. By the way, the Notice to be issued is not the responsibility of the head of Court. It is the Judicial Service Commission that ought to issue the Notice under the NJC Rules. The Learned Senior Advocate noted that one of the strongest challenges to the independence of the Judiciary in Nigeria is the appointment and process of appointment of judges.

PhotoFile Etomi conferred with lifetime Achievement Award

George Etomi, Founding Partner, George Etomi & Partners (GEP), has been conferred with the prestigious Law Digest Lifetime

LEGALBUSINESS CALENDAR NBA-SBL Mentoring Programme

he Nigerian Bar Association Section on Business Law (NBA-SBL) has officially announced its inaugural Mentorship Programme for young lawyers across Nigeria. The programme, which is scheduled to run in various regions of country for nine months, starting from November 2018 - July 2019) will cover aspects of legal practice, such as law office management, professional & personal development and ethics and client communication amongst others. Speaking about this development, the Secretary of the Section, Dr Adeoye Adefulu disclosed that selected mentees who would be paired with notable experts and senior lawyers in Nigeria, would have the opportunity to develop technical knowledge as well as acquire soft skills from these practitioners in the legal industry from across various focus areas in re-

Adeoye Adefulu, Secretary, Nba-Sbl

nowned law firms and companies. The NBA-SBL has sent out notifications to young lawyers across the country to send in their applications on or before Friday November, 16, 2018

One day seminar on ‘The role of litigation in 2019 electoral proces’

he Section on Legal Practice (SLP) Committee on Democratic Process and Electoral Litigation is set to hold a one-day conference in Port Harcourt, on Monday, 3rd of December 2018. The event themed, ‘The Role of Litigation in the 2019 Nigerian Electoral Process’, will hold NBA Port Harcourt House, Port Harcourt, Rivers State. In a statement signed by both the Section Chairperson, Miannaya Essien SAN, and the Chairman of the committee, Ferdinand Orbih, SAN urged members of the profession to take advantage of this

Miannaya Essien, San, chair, section on Legal Practice

opportunity for professional growth.

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Leadership

Thursday 15 November 2018

Shaping people into a team

Making process improvements stick EARLY EXCITEMENT USUALLY LEADS TO BACKSLIDING. tarting with Frederick Taylor and W. Edwards Deming, managers have long been obsessed with ways to improve business processes. And in the past 20 years a host of improvement initiatives, including lean production, Six Sigma and agile, have swept through a range of industries. Studies show that companies embracing such techniques may enjoy significant improvements in efficiency and costs. But when the University of North Carolina’s Brad Staats and the University of Oxford’s Matthias Holweg and David Upton looked at the benefits, they noticed a gap. “These things always work well initially, but often the gains fade very quickly,” Holweg says. “It’s always felt like researchers were telling only half the story. It’s not just about putting the programs in place — it’s also about making them stick.” To understand why some improvements are sustained and others aren’t, the researchers examined 204 lean projects launched from 2012 to 2017 at a European bank with more than 2,000 branches in 14 countries and serving more than 16 million customers. The lean initiative, started by the head office, was supported by a global consulting firm, which helped create an in-house academy to train lean “champions” at each regional subsidiary. Initial projects focused on processes (such as opening an account and making a wire transfer) that could benefit from decreased handoffs and fewer steps and were common to all regions. The regional offices subsequently identified additional projects according to their needs. The projects shared an overarching goal: to increase labor productivity, a key variable in service operations. At first glance, the initiative appeared to be a great success. Over the first four years the bank launched 33 to 51 projects every six months, each involving 1,600 employees, on average. Initial improvements in efficiency averaged 10%; the gains rose to 20% after a year and 31% after two years. Those numbers are in line with the bestperforming lean implementations in any industry, the researchers say, and the bank was rightly very pleased. But when the researchers looked more closely, they found a more complicated picture. Despite the impressive aggregate gains, 21% of projects failed to yield any improvements. And

among the 79% that showed initial improvements, many regressed: Only 73% were still producing results above baseline after a year, and after two years the number fell to 44%. Adding up the projects that had no improvements and the ones for which improvements were temporary, only slightly more than one-third of projects held on to gains after two years. The researchers also explored whether projects that were initially successful could not only preserve the gains but also show continuous improvement — getting progressively better over time, which is the goal of many lean projects. Just 51% of them were continuing to improve a year after launch; after two years the figure dropped to 36%. Seeking to understand these findings, the researchers looked at factors identified in previous research as influencing the initial success of lean projects: the experience of local leaders driving implementation, the level of training provided and teams’ familiarity in working together. None explained the difference, suggesting that what accounts for initial success is different from what’s needed to hold on to gains or to improve further. Interviews with lean champions in the bank’s 14 countries provided

some insight. Managers said that one condition needed to keep improving was visible support from board members and senior leadership — without it, frontline workers believe that the company’s enthusiasm for the effort has waned, and backsliding ensues. They also cited the need for consistent measurement and monitoring and noted that problems arise when significant early improvements give way to diminishing returns. “Addressing the low-hanging fruit is easy; it becomes harder in the long term,” one lean champion told the researchers. The data reinforces these observations. Projects with strong support from the head office showed 35% greater improvement after a year than ones without that support; they were also less likely to backslide, with 79% performing above baseline after a year, compared with 61% of projects not driven by the head office. “Senior leadership, through paying attention to the lean improvements, clearly has a major enabling role in sustaining improvements,” the researchers write. Some companies hope that a continuous-improvement mentality will become embedded in their culture and will motivate front-line workers even without the involvement of senior leaders, but this work suggests that

hope may be unrealistic. The researchers also interviewed executives with deep experience leading lean initiatives across a range of industries; from this, they identified three ways in which organizations can help initiatives achieve sustained improvements. The first is by communicating the program in a clear narrative that aligns with the organization’s purpose. For example, a hotel might focus on how a lean process will improve guest satisfaction; that’s more likely to motivate employees than an emphasis on cost savings. The second is by directing efforts toward pain points whose easing would clearly benefit employees. For instance, one hospital’s initiative aimed to decrease the time medical personnel spent on paperwork, freeing them up for patient care. The third is by ensuring that senior leaders act as coaches, enabling small wins to increase employees’ motivation and engagement. A particularly troublesome obstacle to sustained improvement, the researchers say, is initiative fatigue, which occurs when leaders jump too quickly from one improvement fad to another. (One of the researchers has joked about the danger of airport bookstores, which tempt traveling executives to pick up business books that may send them in pursuit of a new improvement plan.) Embarking on a new project is often more exciting than staying the course, but that doesn’t necessarily deliver the best long-term results. Staats says, “It’s always easier to start something, whether it’s weight loss, going to the gym or smoking cessation. Getting individual changes to stick is hard, and getting organizational changes to stick is even harder.” +++ SIDEBAR IN PRACTICE: Helen Bevan Helen Bevan has spent 25 years overseeing change initiatives at England’s National Health Service, which serves more than 50 million patients and employs 1.2 million health care staffers. She spoke with HBR about the challenges of preserving the gains from one initiative while launching new efforts. Edited excerpts follow. Why is it so hard to sustain an initiative’s improvements? It’s an issue of energy. And when a new initiative comes along, people

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

ask, “What do we do with the old one?” Much of our workforce models the behavior of senior leaders, and when those leaders shift their energy to something else, it’s hard to sustain things. What differentiates changes that stick? Sustainability starts at the beginning, in how we frame a project and what it means to the organization and our purpose. It’s the difference between behaving like a buyer and behaving like an investor. If we’re asking doctors to get on board something that’s under way, it’s already too late. We need to get them invested in the project, and thinking like owners, well before it begins. When I look at the difference between projects that are sustained and ones that aren’t, it often has to do with taking the time at the beginning to set them up, frame them the right way, and get people invested. Is this especially hard in a health care setting, where efficiencies may seem to conflict with quality care? Our purpose is health and wellness. That’s what motivates people in this sector; they don’t come for the pay. If we can frame a project as relating to things that really matter to the people who work here, they will connect with it on an emotional level. Even doctors, who make decisions logically, are more likely to engage and be motivated if an initiative fits with their emotions and values. So we show data and avoid jargon. If we talk about “lean” and “agile” and use words like “kanban,” “kaizen” and “scrum,” it feels like we’re taking away people’s autonomy. We can convey those concepts perfectly well without those words. But don’t people worry that the programs are actually about cost cutting? Of course we focus on costs — we have finite resources. But it’s about framing. Instead of talking about waste, we focus on unwarranted variation in care. Every patient with the same condition should get the same high-quality treatment; when that doesn’t happen, it can be a matter of life and death. Variation also adds to cost, so reducing unwarranted variation increases care and reduces cost. We see more success when we frame things in terms of our mission, which is care.

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BUSINESS DAY

Onuwa Lucky Joseph (08023314782) Editor.

Coca Cola sets sail on ambitious safe birth initiative Onuwa Lucky Joseph

ensure repair and reactivation of equipment deemed bad by public hospitals. MedShare will come in periodically to evaluate and repair old equipment.

he statistics are rather dire, for pregnant Nigerian women and the kids they give birth to. According to a 2013 National Demographics and Health Survey, of every 1000 Nigerian women who give birth, 576 of them lose their lives! The same study also found out that fully 39% of women do not receive antenatal (pre-delivery) care. The number globally is 14%. As well, only 40% of new mothers receive healthcare after childbirth. For the most part, the ‘omugwo’ practice, where in-laws and family visit the new mother to help baby sit, cook aromatic pepper soup and give her general body massage is deemed to be adequate for management of after-birth stress. Another tragic finding, 37 out of every 1000 children born in Nigeria don’t survive past their first month of life. It’s a crisis situation that should compel governments to do a lot more, particularly with regards to maternal healthcare. Unfortunately, the healthcare story in Nigeria is not much different from what afflicts other sectors. It’s clearly a bad case. Reason why well-heeled Nigerians prefer to give birth abroad. A status thing, maybe, but not always so. Sometimes, would be parents know firsthand of pregnant women who didn’t survive the delivery experience and they want no part on that list. What makes it all the more painful is that in over 80% of the cases, the deaths are preventable. The mothers didn’t need to die, neither the children. So why do they die? For the most part, it’s for lack of access to professional care and vital devices, amongst others. That is the broad story, and it’s one that Nigerians have talked about for years on end, and that politicians have capitalized on at campaign season with promises that create hope which usually turns out a mirage. Into this chaos steps Coca Cola Nigeria with its Safe Birth Initiative which the company painstakingly explains is not designed to eradicate the problem, considering its enormity, but supposed to galvanize partnerships both from the public and private sector, all hands on deck to ensure a quick roll back and that sustainable measures are put in place to see to this. To quote Peter Njonjo, President Coca Cola West Africa, “We recognize that the many factors responsible for the very high

Training session conducted by US-Based Engineering World Health (EWH) at the School of Biomedical Engineering, Lagos University Teaching Hospital

maternal and newborn deaths will require different kinds and levels of interventions. We also recognize that no one platform or programme can possibly deal with all the factors”. FORGING THE SAFE BIRTH PARTNERSHIP Coca Cola Nigeria is well acquainted with the Nigerian terrain, having been here for more than 70 years. It’s a business that clearly has reach as an advantage. And with reach comes understanding of the peculiarities of its market including of its consumers and prospects. This must be why they zeroed in on women, as they make up the bulk of Coke sellers – in their kiosks, restaurants and shops all over Nigeria – and as consumers too. Invariably, Coke over the year being conversant with the Nigerian woman and her concerns, she being a net enabler of the Coke business, the company, in search of appropriate public sector partnership, reached out to the Office of the Senior Special Assistant to the President on Sustainability Development Goals, OSSAP – SGDs, Princess Adejoke Orelope-Adefulire, a former Deputy Governor of Lagos State. Interestingly, the SGDs Office has not quite acquired the high profile it had as MDGs Office under the leadership of Hajiya Amina Mohammed, now Deputy Sec Gen of the United Nations. However, it has, quietly, in partnership with other arms of government as well as the private sector

been bullishly driving its onerous mandate. And it saw the partnership with Coca Cola as a good way to get good mileage on its Goal 3 which has as targets: Reduce global maternal mortality ratio to less than 70 per 100,000 live births End preventable deaths of new borns and children under 5 years of age, with all countries aiming to reduce neonatal mortality to at least as low as 12 per 1000 live births and under-5 mortality to as low as 25 per 1,000 live births Reduce by one third, premature mortality from non communicable diseases through prevention and treatment and promote mental health and well being Ensure universal access to sexual and reproductive healthcare services, including for family planning, information and education, and the integration of reproductive health into national strategies and programmes. The other public sector institution partner, for obvious reasons, is the Federal Ministry of Health. Private sector collaboration came in the form of MedShare, a US based nonprofit that retrieves surplus medical supplies and equipment from US hospitals and manufacturers and redistributes them to needy hospitals in developing countries. However, although MedShare has the equipment in stock and are willing to donate them, there are

clearly other costs attached, e.g. logistics, training, needs assessment, monitoring, etc. For all of that, Coca Cola had to invest a $1m donation to ensure feasibility while also coordinating the Initiative. PROJECT SCOPE The Safe Birth Initiative is about strengthening the ability of public hospitals to ensure safe births and reduce the unacceptably high numbers of maternal and newborn deaths in Nigeria and the sub region. To achieve this, Coca Cola, alongside its partners, is Equipping 15 public hospitals nationwide with vital equipment and kits necessary to enhance safe birth. (The National Hospital Abuja had four 40-foot containers delivered in October 2018, including 2 units of operating suites already installed). Training biomedical engineers (and this is where Sustainability comes in). Nigeria’s awful maintenance culture is in ample evidence at our hospitals. A two-week training was conducted by experts for biomedical engineering technicians at the Lagos University Teaching Hospital, in October 2018. This sort of training which will be done from time to time will help ensure that biomedical technicians are sufficiently motivated to keep hospital equipment up and running rather than gathering dust as is usually the case. In collaboration with MedShare,

EVENT LAUNCH At the event launch which was done on November 3, 2018 at the National Hospital, Abuja, all parties were effusive with praise for Coca Cola and the good work it was doing on behalf of Nigerian women. The Minister of Health, Prof Isaac Adewole, while enjoining other private sector players to play their part, thanked Coca Cola for “making our women safe; keeping them alive and putting into effect the statement that they must not die while giving birth.” Hajiya Aisha Abubakar, Minister of Women Affairs and Social Development, commended the partnership, “which will certainly ensure sustainability and capacity building for our people within the healthcare system.” Princess Orelope Adejoke-Adefulire, while affirming that “The life of every mother and child counts”, appreciated Coca-Cola for being “a strong collaborator and wonderful partner in ensuring that every mother and every child stays alive”. EQUIPMENT FOR INSTALLATION Some of the equipment that will go to 15 hospitals nationwide include Ultrasound machines, Infant Incubators, Resuscitaire Infant Warmers, Delivery Birthing Bed, Anesthesia Machine, Multi-parameter Patient Vital Signs Monitors, Phototherapy Light, Stainless Steel Baby Bassinets, Handheld Doppler, Fetal Monitor, Baby Scales, Operation Theater Light, Patient/Hospital Beds and Mattresses THE CALL FOR COLLABORATION In his closing remarks, Coca Cola’s Director for Public Affairs and Communications, Clem Ugorji, called on other corporates to feel free to join the Initiative as partners. Calling attention to the fact that the Initiative logo was not Coca Cola branded, he assured other corporate organisations that they were welcome to co-own the Safe Birth Initiative and play their own part to ensure that much fewer Nigerian women and children die from childbirth and after-birth complications. For a country like Nigeria, this is definitely an initiative worthy of commendation and emulation.

BUSINESS DAY

Thursday 15 November 2018

Corporate Social Impact

How corporate organisations can help themselves by helping others

naugurate a funnel system capable of bringing together enthusiastic young or older people. Common denominator is that they be keen on improving their

lot. Train them on how to handle your products or ideas. Set them free as entrepreneurs in charge of the product and their own lives Equip them with start-up grants which may or may not be repayable Guide and monitor their performance RESULT: It’s rare to have 100% success rate but you will have good success and build loyalties that last, in some cases, for as long as your company does. THANKSGIVING IS ALSO FOR CORPORATES November is Thanksgiving season. And for all kinds of reasons. Traditionally, that’s when most food crops come due for harvest. And being so close to end of year, everywhere blowing is the festive air. In traditional societies, November is that time of year when hunger is least an issue. Yam is being harvested, same as rice, beans, soya beans, potato, guinea corn, etc. Early harvests would have been cassava and maize. These two, however, can also be harvested in November, giving the dining table a variety that some hotel buffets can’t rival. When people think Thanksgiving, however, they think America and the Turkey that is usually set free by the President. Nobody pays a mind to the countless millions that will be slaughtered as Thanksgiving Sacrifice to the belly god, whatever the religion professed by those sacrificing. Every fourth Thursday is a national holiday in the US to observe Thanksgiving. For the rest of the world, it doesn’t quite have the religious and patriotic connotation, but we should all be thankful all the same. Question is, should corporates observe Thanksgiving in whatever guise? Well let’s see Your company is still in business. Your generator has not packed up, and you still have adequate budget for fuel. Competition has not outmuscled you from your terrain. Nigeria’s porous borders notwithstanding, customers still buy your sometimes more expensive product. Government’s policy flip-flops may have made you a little dizzy, but you

Biomedical Engineering Technicians at the end of the 2-week capacity training aimed at improving hospital equipment maintenance and uptime

are regaining your foothold on things The FIRS didn’t close your doors or put any of those annoying notices on your premises You survived a few corporate mishaps You have a budget for end of year party! You are already projecting for next year despite everything. There’s a lot to be grateful for. You only need take your eyes off the blinding negative stuff. The party need not be an elaborate affair, but staff can bond well over bites and drinks, and as is becoming the custom, visit Orphanages, IDP Camps, Prisons, etc. to spread the smile. But even more than food and drinks is to pass on knowledge that equips the not so privileged with tools for making something of their lives. Happy Thanksgiving! 100 MOST INFLUENTIAL PHILANTHROPISTS Life pivots around those few people who have the smarts to make more money than is enough for themselves, but generous enough to want to share of their good fortune with others. Richtopia has become the go to place to find out who is who in the philanthropy business worldwide. CSI intends to weigh in on the matter in the near future, especially as it regards the Nigerian ‘awardees’. Here, we bring you the first 30 on the list: Aside numbers 6 and 11, number 25 also made quite an impression. Warren Buffet (Investor)

Bill Gates (Business magnate, Philanthropist) JK Rowling (Writer) Oprah Winfrey (TV Personality) Elon Musk (Entrepreneur/Investor) Aliko Dangote (Industrialist) Richard Branson (Business Magnate/ Investor) Mark Zuckerberg (Technology Entrepreneur) Jeff Bezos (Technology Entrepreneur/ Investor) Mike Bloomberg (Businessman, Politician) Tony Elumelu (Banker/Entrepreneur) Eric Schmidt (Businessman/Software Engineer) George Soros (Investor) Michael Dell (Businessman/Investor) Paul Allen (Technology Entrepreneur) Leonardo DiCaprio (Actor) Tony Robbins (Life Coach/Entrepreneur) William Shatner (Actor/Producer/ Singer) Mark Cuban (Businessman/Investor) Ellen DeGeneres (Television personality) Arianna Huffington (Syndicated columnist/Businesswoman) Steve Wozniak (Inventor/Engineer/ Programmer) Prince Andrew, Duke of York (Royalty) Tim Cook (Business Executive/Industrial Engineer) Aliaune Thiam (AKON) (Singer/Producer) Melinda Gates (Philanthropist)

Pierre Omidyar (Entrepreneur) Sir Ken Robinson (Author/Speaker) Marc Andreessen (Entrepreneur/Software Engineer) Phil Keoghan (Television Personality) IBOLAND POISED TO ABOLISH OSU CASTE SYSTEM December 28 is the date! Lots of people are eagerly looking forward to this red letter day when the Osu Caste system will be abolished in Iboland. Prince Ikenna Onyesoh, Regent of Nri Kingdom, affirms the abolition on that date and goes on to say it would be ‘spiritually suicidal’ for anyone to continue the practice after that date. If that sounds too good to be true, that’s exactly how it sounds. It is a good thing that this will be happening during this festive season, when, traditionally, Ndigbo tend to congregate in their ancestral land. They will come from everywhere to hear this proclamation loud and clear, and hopefully, the Osu caste system, accurately described by the Regent as a ‘devaluation of mankind’ will be consigned to the dustbin of history. For a discriminatory practice that has thrived for centuries, it’s hard to imagine that one proclamation is all it will take for it to be laid to rest. One expects, however, that this, coming from the traditional and universally respected Nri Kingdom, will be one strong nail driven into the coffin of the despised caste system.

Thursday 15 November 2018

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BUSINESS DAY

GARDEN CITY BUSINESS DIGEST Experts call for law on Sickle Cell tests in Rivers schools as over 50m Nigerians now carriers ... Rotary launches war on SC in Rivers ... Says primary healthcare practitioners carry the power to save the next generation IGNATIUS CHUKWU

ivers State must make a law making genotyoe tests compulsory for admission in any school in the state. This is as Nigeria leads the world in high prevalence of the dreaded Sickle Cell syndrome with one quarter of the population or 50 million as carriers. Now, a a war to save the next generation has been launched in the state. The call was headed by the the permanent secretary in the Ministry of Health, Primary Healthcare Unit, Agba Harry, who, said at a healthcare campaign venue in Port Harcourt put together by Rotary International that Nigerians can no longer be allowed to pass impaired genes from parents to children non-challantly. Harry hailed the effort of Rotary International in mounting a campaign and the training on Sickle Cell which he said his department had been eager to do for long to no avail. The perm sec called for awareness also on Resis, saying its effect on blood compatibility was as important as that of Sickle Cell. He said Resis was the cause of high maternal mortality rate in Nigeria. He admonished the trainees to : «Talk to everybody you come across about genotype, talk about Resis ». On this note, Sickle Cell campaigners who swarmed Port Harcourt at the week said the power to save the next gen-

Governor, Nyesom Wike eration was in the hands of primary healthcare providers who must stop persons intending to marry from toying with genotype tests. The team led by Rotary President, Ibim Semenitari, wants the healthcare givers to learn the right practices that would either eliminate or reduce the menace of sckle cell. Semenitari said ; « We often gloss over this and seem to want to wish it away. No ! Take active steps to reduce the incidence ». She told the caregivers to step up their game because they interface with the people. Rotary organised the training in Port Harcourt to train the primary healthcare practitioners and others in the interface stage that have much to do with Sickle Cell by bringing

experts that delivered lectures and donating drugs and items to the healthcare centres in Rivers State. Semenitari observed that some persons usually get married before caring to find out their genotyes, saying nobody had the right to punish children by giving birth to sicklers (SS). « Begin with finding out your genotype because you have no right to make any child suffer. Fid another person to marry if the one you love so much is AS. Do not subject the next generation to Sickle Cell Anaemia ». The lead resource person, Angus Ikpe, a public health consultant and chief medical director of Standard Care Hospital in D-Line, said Africa and Asia lead the world in the SC

menace and that malaria and SC distribution were related. He said sicklers have problem anywhere oxygen was scarce and that a sickler is always in cunpredictable risis because the blood cells are always deficient. He said SC is the commonest genetic disorder but that blood infusion comes to the rescue from time to time. He said the latest hope is a procedure undergoing clinical trial oversees which may introduced processing of the blood of a sickler and reintroducing it after purification and enrichment, but that time for commercial application was still not known. A 42-year-old sickler, Ifeoma Ifejjika, also a Rotarian, thrilled the audience with her real-life experience with the sickled genes, saying what the doctors said were true but far more true that stated. « A sickler dies one million tyoes before death comes because of many crisis and the certainty of death ahead. We also feel that we have been much of a burden to our families and so we seem to recline not to add to it. This creates a withdrawal syndrome that most family members would never imagine ». She said she fought the battle against defeat by deciding to create impact and keep living her life as if death was not near, from day to day. Tears welcomed her lecture when she said mentors told her to brave it up and stand up to testify but that if she failed to do so, they would present her to the audience as a classical case of Sickle Cell. Another Rotarian, Carol Cookey, an expert on Nutrition, dazzled the trainees on the right choice of food for sicklers and other persons and how people could eat their way to heathy life. During the interactive session, many questions were fired from many of the large audience due to the striking awareness reactivated in the health workers and other intervention personnel.

Eat‘N’Go hits PH to create new taste in Niger Delta with three brands IGNATIUS CHUKWU & INNOCENT ETENG

ood and taste may take a new shape in the oil region following the entry into the market by Eat’N’Go, a franchisee outlet. The new taste giant has made inroads into Port Harcourt, introducing three world class brands, Domino’s Pizza, Cold Stone Creamery (ice cream) and Pinkberry Gourmet Frozen Yoghurt. This was revealed on November 7, 2018, in Port Harcourt during a press briefing that marked the unveiling of the outlet located at Olu Obasanjo Road during which invited members of the public received free pizzas and their chosen flavours of ice cream and yoghurt. Eat’N’Go, which came to Nigeria in 2005 but mainly maintained a presence in Lagos, opened shop in Port Harcourt the next day (Thursday) for formal business transactions. It will join other international taste brands such as Mr Biggs, Chicken Republic, Kilimanjero to fight for space. There are some dominant local brands such as ‘The Promise’ that work hard to dominate the city. According to the company’s Chief Operating Officer (COO), Antoine Zammarieh, the reason for storming Port Harcourt is because the people deserved the best, not only in terms of rich brands, but also in efficient service-delivery. He said the strategy if to strive to take the Niger Delta region from Port Harcourt. Meanwhile, the company’s human resource director, Adeeko Olusola, stated that not less than 150 persons have already been directly and indirectly engaged by the company in Port Harcourt. He promised that customers would get value for every naira they spent on the company’s products. He also assured that the products would be affordable to all classes in society, depending on the buyer’s preference. “Our guarantee to you is that (for) every one naira you spend, you get absolute value,” he said. Domino’s Pizza is a world brand that started in the United States (US) in 1960. The company currently has 900 outlets in the world, with 300 stationed outside the US. Also, Stone Cold Creamery and Pinkberry Yoghurt owe their origins to the US.

Sickle Cell: The pains and confessions of a courageous sickler

Port Harcourt by Boat With

IGNATIUS CHUKWU

orty-two year old Ifeoma Ifejika stepped out boldly at the auditorium of the Rivers State Primary Healthcare Board at the Waterlines (Warmate House) and took the floor by the storm to reveal the true pains and feelings of a sickle cell (SS) patient; simply called a sickler. Before she spoke, various health experts

especially Dr Angus Ikpe had tried to convey the pains and the sinking feelings a sickler undergoes on a daily basis, but when she stepped out, she shocked the audience by confirming everything that was said, but added that all of this was not enough to express the magnitude. The hall became sick, at least in feeling. Ifeoma tried to show how it feels to be sure you may not live the next day. So, if you were in class, how would you develop the right attitude and right size of ambition to study hard and write an exam you were sure you may not live to use? Tears started rolling down some cheeks. Hear her: “I have lived in the fear of dieing, a life too dangerous to aspire. The love of family is an issue because while it makes one feel good to be loved but it makes one feel guilty of denying your family the joy they so deserved. That

adds to the pressure of a sickler. It hurts when people trivilaise their families. The sickler now feels she has caused too much pain to her family. Such a person feels sensitive. The sickler hurts without showing it, and lives daily with the fear of dieing the next day. Every single moment, something goes wrong ; even when you went to bed the previous night hale and hearty. Every speaker in the hall mentioned the bone crisis of a sickler. Ifeoma confirmed thus ; « Your bone often feels like it wants to pop out. It takes God to seek skills after your dreams or to feel you still have things in you despite sickle cell. My determination is to overcome the feeling. Many sicklers die a million times before they died. The psychological trauma is tougher than the medical side. » She went philosophical to scratch a reason to keep hope

alive. « There is always a reason for whetever that happens to us. God sees the end, that is my strenght, my motto. I have to rest often. Each one has a surprise. The pain or crisis has a surprise. You can’t explain it in two days. » Ifeoma is an active Rotarian who helps peole with her story. She has a piece of advice to any sickler striving to fight on : « Concentrate on the positive, not the pains. » Many went home in tears, but not without thanking Ibim Semenitari, the president of Rotary Club of Port Harcourt Cosmopolitan, who organised a training for healthcare practitioners and caregivers on Sickle Cell to create awareness and stop pains to the next genertaion. Since Sickle Cell has no cure yet, the best bet, Ibim said, is to avoid AS/AS or AS/SS marriages. The people to help make this happen are the caregivers.

BUSINESS DAY

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Thursday 15 November 2018

Investing in Rivers State RIRS launches online tax administration January 2019 as tax clearance to be in matter of days • Hopes to boost Ease of Ding Business • Tax pace sanitised • Enumerators working to reveal all landlords, tenants in PH Ignatius Chukwu

he much-awaited seamless tax system backed by online tax management system may come into operation in January 2019, the executive chairman of the Rivers State Internal Revenue Service (RIRS), Adoage Norteh, a chief, has declared. Speaking at a breakfast meeting at the Faarah Cottage Lounge located at 37a Aba Road, at the weekend, the executive chairman declared that the agency has worked to sanitise the chaotic scene he inherited on resumption of office. He also revealed how his team was working to ensure that every citizen paid tax, no matter how small, saying enumerators are in town capturing all houses, landlords and tenants into a new but robust tax net. The Executive Chairman said the evidence of the job being done at the RIRS is the fact that the internally generated revenue (IGR) of the state has not dropped despite the drop in economic performance of the nation. He also said the Nyesom Wike administration had ordered a halt in the collection of many taxes to reduce pain to individuals but that the IGR of the state has not dropped. Tax Clearance Online from January Annual tax returns will no longer be manual. It is the total of your financial transactions in the previous year. All you have to do is disclose your staff details that would reveal increase or decrease in number and amount paid to each of them. We collect PAYEE, not profit tax. It is your statement that would declare what you paid to each staff as salaries in the year. We now compute their taxes and check what you remitted as

Adoage Norteh, executive chairman, RIRS

PAYEE for the year under review. This process is cumbersome and sometimes lingers up to March of the following year. Now, IT will make it simpler. All you need to do is to give us your soft copies and we get back to you immediately. Annual returns would not take very long time any more. We met chaotic scene When we came in, we met a system that was chaotic, so we embarked on repair work. We laid a robust ICT infrastructure so we can get things working. ICT requires modification from time to time and we can now use it to do a number of things. Before now, we did tax clearance manually but by March 2018, we launched the Rivers State Tax Administration and Information Management System (RSTAIMS). So, by January 2019, there would be

no manual but digital system. You apply online and get your tax clearance with ease. We are doing that for the purpose of the tax payers because sometimes they need it very urgently. Delays are not good in tax administration. The excessive bureaucracy is gone through online processing. It will now be a matter of days. The system will be interactive. You can lay complaints. Tax enumerators in town Tax enumerators are in town already building a data base. We will put all of that together in one basket. We would clean it up to avoid duplications, and then we are ready to go. The Internal Revenue Service (IRS) is not your enemy, and not a political party. It has no party flag or logo. Tax is for everyone, provided you earn income; whether you are a religious person, a party person,

trader, or whatever. As far as you earn income, we charge tax on it, according to what you earn. There is a tax calculator in the online tax register to enable you calculate your own tax. This way, there should no more be crowds at the tax office. We want a seamless system. If you are computer literate and want to obtain tax clearance, you can come to the revenue office with the soft copy and we can convert it. By January 2019, this system will kick off. Tax space now sanitised The Nyesom Wike-led administration stopped a lot of taxes because of the economic challenges facing individuals. The Rivers State tax space has been sanitized to an extent. The chaos that has been there has reduced, though not an easy task at all. Even as we talk, there are touts still parading with tax demands. What a tax payer has to do is to confirm if the demand notice is genuine. The government wants businesses to be done with ease in our state. We are proud to say that ‘The Ease of Doing Business’ index now in Rivers State indicates a very positive progress because of the removal of multiple taxes. We are proud of that. Soon, the tax environment will be attractive. Massive campaigns will go out next year on this change. That ease will further improve by the time we launch the online system. Tax money is being used for development in both the urban and rural areas of Rivers State. People now wonder, is this the same Port Harcourt I left a few years back? That is what encourages me to work harder on tax collection. I am not a spokesman for the government but I am only testifying in the area that I have seen. We expect the firms to open their books so we can work with them. We want to build trust so that tax administration can be transparent and easy. Soon, the tax environment will be attractive. Massive campaign will

come next year about the migration from manual to digital tax system especially the tax clearance certificate system. Tax compliance getting better in Rivers There is remarkable improvement in tax compliance in Rivers State, but there are people that will never comply, unless pushed. This is evidenced by the fact that IGR is not dropping despite recession and economic hardship. If you go round Port Harcourt, you will find that many companies are no more, including PZ, Kingsway, Michelin, UTC, SCOA, National Oil; from Trans-Amadi, to Reclamation Road, to Industry Road, to Harbour Road, and to Azikiwe Road. Drop in the national economy has hit Rivers State badly. Enumerators working round the clock Our job is to get everyone to pay tax, even if it is N200 per month. Enumeration will reveal the landlords and from there, we get to their tenants. We do not have problem with tax interference because Gov Nyesom Wike has never called me to take it easy with this person or to go after that person. He is aware of the tax laws and he does not interfere in my work. Tax is rooted in law; the tax code is there. We interpret it. The law spells it all out; the penalty, the interest, etc. There is the Best of Judgment (BOJ) concept which allows the tax master to estimate tax for a person and it is the duty of the person so taxed to present documents to bring it down or even up. It is the discretion of the tax master. Despite this, we have a human face. We can grant waivers. Some people reduce profit and push all the income to salaries and job orders. We now look for the commensurate tax they should have paid on PAYEE and withholding taxes for job orders. This way, the lies fall off.

How ‘Wisdom to Wealth’ scheme plans to create entrepreneurs in Niger Delta with music, loans, etc Ignatius Chukwu & Favour Ichemati

talent-hunting group in Port Harcourt, Rivers State, is set to unleash hidden stars in the Niger Delta and Nigeria with strategic schemes that include music, empowerment and loans without collateral. It is termed W2W. Anyamate Kio, the executive coordinator, Wisdom to Wealth and Development Foundation, spoke with BusinessDay in Port Harcourt. This is a non-governmental organization (NGO), an empowerment NGO. We call ourselves the NGO for mind, business and project development towards sustainable leadership, peace and prosperity. The various streams: The do talent development; un-

der this we have Divine Icon. It is a national music talent hunt, out to train music artistes from 16 years and above to become music celebrities. We started in 2013 and this is our Season 6. With a N2.5m deal where the winner goes home with N500,000, we register the person with Fellowship of Gospel Music Ministers of Nigeria and open platforms for the winner in Moment of Worship in Port Harcourt and other programmes that we are affiliated to. The third thing is that we take them on a tour African country after producing their singles. We also produce singes for the top three to seven. We are in the semi-finals and the people in the house take the opportunity of trainings including entrepreneurial skills, empowerment trainings and music trainings.

At the end of the day, every person goes home with at least a skill. There is the ‘Loans without Collateral’ scheme. We realize that government empowerment dealing only on seminars and lectures without giving cash will not give birth to real entrepreneurs. When trainees wait for months to get loans, their skills will disappear or become obsolete. This is a fast-growing technological world. If you say you have the knowledge of printing recharge cards and you have not started printing in the next six months, your neighbour may start printing and you will be a late comer. That is why we launch the ‘Loans without Collateral’. We have from N50,000 to N1m. The third platform is the ‘Vocational Training Platform’ where we

give skills to our trainees on skills such as soap making, bead making, hair dressing, computer training, web development, etc. That is the capacity and vocational platform in house. The fourth one is what we are bringing on board, ‘Icons Mind Magazine’. This is a celerity magazine that is going to showcase achievers in various endeavours. They will have to give their stories that would serve as stimulus to beginners to realize that if this person can make it, after going through this, I too can make it. Semi-final of Divine Icons: We started with over 500 contestants in Season 6 in 28 states in Nigeria and Abuja plus two African countries (Liberia and Zimbabwe). I had to stop the African countries because this year, we limited it to

Nigeria. From this, 58 were chosen to come for the quarter finals after which the performance and voting were able to get 25 to go to the semi-finals. Today, five persons will be eliminated by reason of the least performance. The rest 20 will remain in the house, just as you have Project Fame, etc. Elimination will continue every weekend. On November 25, the grand finale will happen with about eight contestants to challenge at Atrium on Stadium Road. Conclusion: The legacy one can leave is what you have done to impact on people. Any leader that cannot empower his followers is only taking a walk. By the time you are off the stage, you will see that there is nobody to take your place.

Thursday 15 November 2018

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eCam calls for PPP in driving ICT usage in elections CONRAD OMODIAGBE

he Electronic Campaign and Marketing Summit (eCam) is set to push for public private partnership (PPP) between policy makers and innovative experts from the private sector on methods of improving efficiency in election and campaign processes through maximum utilisation of information communication technology (ICT). With collaboration between the Federal Ministry of Communications and other agencies such as the Independent National Electoral Commission (INEC), Nigerian Communications Commission (NCC), National Information Technology Development Agency (NITDA) and National Orientation Agency (NOA), eCam hopes to explore how the use of ad-

vanced technology can better election process management in Nigeria. The summit, starting today in Abuja, will bring together members of academia, local and international experts in the ICT field and government agencies, to discuss tactics and strategies of collaboration between organised private sector and the government, especially election umpire INEC, for transparency and efficiency in the election process. Speaking on the imperative need for technological advancements in election process, Sola Oworu, CEO, eCam, notes that the world is now a global village and Nigeria needs to catch up. “The world is not waiting for Nigeria and taking a cue from other countries like the US, India and even South Africa, ICT has played a significant role in their campaign processes for example 7D

holographic technology. Social media has also allowed campaigns to be transmitted across borders simultaneously, the internet has also allowed for things like short messages unlike the past where the whole city is defaced with posters, which has reduced,” he says. With Vice President Yemi Osibanjo set to attend, the summit is meant to be a unique fusion of insightful speakers and attendees sharing ideas and strategies while networking with one another. Other attendees for the summit include INEC chairman, Mahmood Yakubu, Garba Abari, director-general, NOA, Ali Pantami, directorgeneral, NITDA, and vice chairman NCC, Umar Danbatta. The two-day event scheduled to hold at the Shehu Musa Yar’Adua Centre, Abuja, will also feature speakers like

Larry Kim, John Rampton, Scott Stratten, Barry Shwartz, and Chris Ducker. Stakeholders from relevant sectors and agencies will also grace the summit, as means of utilising technology to attain global standards of security and marketing during the 2019 elections will be analysed and explored. On what would be the takeaway from the event, Oworu notes that the summit is a small part of a robust plan by eCam, in helping Nigeria attain an efficient standard of campaigning and coordinating elections. “The takeaway should be that methods of improving our electoral processes using modern technology are devised with the help of experts and stakeholders, effectively implemented by the bodies involved in electioneering all in a bid to achieve a more democratic Nigeria,” he said.

33 NEWS

BUSINESS DAY

Banks refund N72.2bn to customers after complaint resolution HOPE MOSES-ASHIKE & ONYINYE NWACHUKWU, in Benin City

he volume and value of e-transactions are projected to continue to increase nationally and globally as a result of broader ecosystem scope, evolution of channels, and adaptability to disruptive innovations/modes payment increased inclusion and evolving technologies. The CBN through it Consumer Protection Department (CPD) has resolved over 13,715 complaints resulting in the refund of about N72.2 billion to customers by the deposit money banks. The breakdown of the refund shows that N66.5 billion, $18.5 million or N5.6 billion converted using CBN’s official rate of N306, €26,319.03 or N10.43 million, and £9,085.98 or N3.13 million were refunded to customers in the country. This is coming as 25,043 cases of fraud were reported by deposit money banks in 2017, compared with 19,531 cases in 2016, representing a 28 percent increase in reported fraud cases in 2017 Even though there was a 24 percent reduction in actual fraud loss value in 2017 compared with 2016 figures, actual fraud loss value amounted to N1.63 billion in 2017. The statistics provided by the CBN at the workshop show that there was a significant increase in the year-

on-year volume and value of transactions across all payment channels in Nigeria. Consequently, 1.4 billion transactions with a value of N97.4 trillion were processed in 2017 as against 869 million transactions with a value of N69.1 trillion recorded in 2016. An increase of 59.7 percent and 40.9 percent were recorded, respectively, in the volume and value of transactions in 2017. The CBN said on Wednesday that it would soon issue a framework on consumer protection. Disclosing this in Benin City at the ongoing workshop for finance correspondents and business editors organised by the Nigeria Deposit Insurance Scheme (NDIC), Salam-Alada S.K, director, CPD, conducted a mapping exercise of financial literacy activities in Nigeria as one of the achievements of the department. Other achievements were the biannual consumer protection compliance exams, review of the guide to bank charges (2004, 2013 and 2017) and conducting of baseline survey on financial literacy in the country. Salam-Alada, who was represented at the workshop, suggested some way forward for regulatory intervention/ collaboration to include, implementation of consumer protection framework, establishment of industry fraud desks and strengthening internal controls among others.

Diabetes: Edo assures health sector initiatives will ease burden

L-R: Adetola Atekoja, chairman, Rydal Mews; Modupe Anjous, chief executive officer, Rydal Mews; Adeola Azeez, deputy country head, Deutsche Bank Nigeria, and Bankole Animashaun, director, Rydal Mews, during Rydal Mews 7th anniversary celebration in Lekki, Lagos

Nigeria lags peers in non-oil export earnings as poor infrastructure hurts manufacturers ODINAKA ANUDU

igeria lags behind a number of countries in non-oil export earnings as Africa’s biggest economy faces poor infrastructure slump that continues to hurt local manufacturers. South Africa, continent’s second largest economy, earned 164.9 billion rand (about $13bn) from exporting automobiles alone in 2017, according to the 2018 Automotive Export Manual. Bangladesh, often regarded as one of the poorest countries in the world, rakes in $28 billion just from textile export annually. In 2016/17, Brazil, with almost Nigeria’s demographic size (209m), exported 28.15 million metric tons (MT), earning over $38 billion just from sugar. Sugarcane contributed $43.8 billion to Brazil’s gross domestic product (GDP) – equivalent to almost 2 percent of the entire Brazilian

economy. Even India, which was projected to grow as fast as Nigeria by the Goldman Sachs in 2012, is set to produce 35 million tons of sugar next year. For Nigeria, data from the National Bureau of Statistics (NBS) show that the country earned N577 billion from total export in the first quarter of 2018, and N218.98 billion in the second quarter (if you factor out Other Oil Exports). This is about $2.20 billion for the half-year of 2018. “The key issue is competitiveness. Unless we have an environment that positions the economy for competitiveness, we cannot make any headway,” Muda Yusuf, director-general, Lagos Chamber of Commerce and Industry (LCCI), said in Lagos on Wednesday. “Today, diesel is N260 per litre. So, how will those in the manufacturing sector survive? Export is not just about cocoa, shea butter and other primary products,which make up 90percent of our export port-

folio today. Export is about industrialisation, value-addition and manufactured products,” Yusuf, who was a keynote speaker at a book launch by Bala Yesufu, Cadbury’s director of corporate communications and governmental affairs (West Africa), said. He explained that Nigerian manufacturing and export sectors cannot make headway without strong infrastructure, citing the case of Apapa ports roads as one key reason why exporters were struggling today. Nigeria needs to spend 3 to 5 percent of its GDP on infrastructure annually. A 2018 Financial Derivatives Company analysis shows that the country needs to spend $15 billion annually for 15 years to develop its infrastructure. A 2016 research by BudgIT using data from Indexmundi, the United States Department of Agriculture (USDA) and Vetiva Research found that Nigeria had a 45 percent share of world’s

palm oil market in 1960. Frank Aigbogun, publisher of BusinessDay, said, “Nigeria only scratches 900,000 metric tons of palm oil per annum, which represents just 1.52 percent of global production, despite having a 45 percent share of the product in 1960.” Aigbogun, who was the book reviewer, lamented the state of Apapa roads and how Nigeria’s lack of seriousness led to the withdrawal of GE’s railway arrangement, which could have ended Apapa woes, stressing that the country needed to do more to drive non-oil export earnings to serve as a buffer to the economy. According to Bala Yesufu, the government needs to resuscitate the Export Expansion Grant and pay back billions of backlogs to help exporters compete. Yesufu said there was a need for total impact assessment of the African Continental Free Trade Area before Nigeria sign onto it.

do State governor, Godwin Obaseki, has assured that the various initiatives in the state’s health sector will ease the burden of diabetes disease among sufferers, urging lifestyle changes to keep the disease at bay. Obaseki gave the assurance in commemoration of the United Nations World Diabetes Day, observed on November 14, each year. According to Obaseki, the health insurance scheme, which is being finalised, the Edo Health Care Improvement Programme (Edo-HIP) and other initiatives with local and foreign partners in the health sector will contribute significantly to providing the needed medical support for persons suffering from diabetes and other illnesses in the state. He noted that the theme for the 2018 and 2019 World Diabetes Day, ‘The Family and Diabetes,’ calls attention to the roles of “families across the globe in the management, care, prevention and in educating their members on diabetes. This also shows that when members of families adopt certain lifestyles, it will go a

long way in preventing diabetes.” He said the state government’s approach to improving health care was one that prioritises everyone’s health, and explained that the health sector has been delineated to cater to the needs of all Edo people and residents. He added that the health insurance scheme would provide the impetus for efficient functioning of the primary health care centres in the state. “Families are encouraged to join the collective fight against diabetes by supporting each other with information on the importance of regular medical checks, the right diets, exercise and an adjusted lifestyle that would help in managing and preventing the disease. “One of our strategies is prevention. We are convinced that preventive health care reduces cost, if any, and eliminates pains and suffering associated with treating a disease. The Edo Health Improvement (EDOHIP) programme has been aligned with our preventive health care strategy.”

34 BUSINESS DAY NEWS Nigeria pays higher interest rate on new... Continued from page 1

The successful transaction follows closely behind Nigeria’s successful engagement with the Fitch rating agency, and their subsequent decision to change the outlook on Nigeria’s sovereign rating from B+ (negative) to B+ (stable), based on improving macro-economic fundamentals. However, this new borrowing takes Nigeria’s total external debt to $24.9 billion, six percent of the Gross Domestic Product of Africa’s largest oil producer, even as it provides cover for declining external reserves. The Federal government sold benchmark-sized dollar bonds maturing in 2025, 2031 and 2049, which is equivalent to a 7-year, 12-year and 30yearbonds,atapricehigherthanitsprevious issuance. It sold January 2049 (the 30-year bonds) at 9.25 percent which compares with the 7.625 percent yield achieved on a 30-year bond a year ago. The federal government also raised a 12-year bond at 8.75 percent compared with the 7.875 percent achieved on a similar tenor in Feb-

ruary and sold the 7-year bond at 7.625 percent. BusinessDay learnt that the total book size or bids on the bond was $9.25 billion representing an over subscription of three times despite the significant oil and wider macro market volatility Nigeria face and it allows the country achieve its 2018 external debt requirements for the year’s budget at a cost lower than many of its peers across Sub-Sahara Africa. The proceeds are expected to fund the country’s N9.1 trillion ($29.8 billion) budget, which has a deficit of N2.4 trillion and could even widen if ambitious revenue targets set out in the budget are not achieved. The sale also provides a buffer for external reserves which have shed $6 billion since the end of June, after the Central bank raised dollar sales to defend the naira against fund outflows that have rocked other emerging market currencies. External reserves stood at $41.6 billion as at November 13, according to CBN data while the naira weak-

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ened 0.15 percent to N364 per US dollar at the Investors and exporters window, Wednesday. “Nigeria paid more to raise the Eurobond because of rising interest rates in the United States which has seen risk premiums repriced and made the global market conditions tighter than they were at the previous issuance,” said Wale Okunrinboye, head of research at Lagos-based pension fund, Sigma Pensions. Other countries have largely avoided the Eurobond market in the second half of the year over fears that the cost of borrowing would be significantly higher as interest rates in US treasuries rise to their highest since the global financial crises. But cash strapped Nigeria has had to go into the market as revenues have consistently fallen below set targets in the last three years despite expanding expenditure. The pricing was determined following a series of meetings with investors in London and conference calls with investors globally attended by the Nigerian delegation, which comprised Minister of Finance,

L-R: Adegoke Omotola, coach/speaker, John Maxwell Team; Clara Okorie, coach/speaker; Olusoji Oyawoye, speaker, and Aminat Gbajabiamila, personal development and brand transformation coach, at the press conference to announce the Discover Achieve Replicate Enjoy (DARE) summit in Lagos, yesterday. Pic by Olawale Amoo

Political pressure may have suppressed... Continued from page 1

the data is due to pressure from

government officials, who may be trying to prevent the opposition from using an increasing unemployment rate to score cheap points against the incumbent in the oncoming elections,” said a source familiar with the situation on the condition of anonymity. Nigerians will go to the polls to elect the president, state governors, as well as federal and state legislators in February 2019. APC faces a strong opposition from the People’s Democratic Party (PDP), which has vowed to regain the presidency that it lost to the ruling party in 2015. PDP has chosen Atiku Abubakar, a wealthy businessman and former Vice-President, as its presidential candidate, to challenge President Muhammadu Buhari. Both are Muslims from the north. The last time Africa’s largest economy reported an official unemployment rate was more than one year ago, when the rate stood at 18.8 percent as at Q3 2017, the highest since 2010, according to Bloomberg data. The development is however unusual, given the promptness in data release the NBS has been known for in recent times. The unemployment rate has more than doubled since 2015,

when President Muhammadu Buhari came into power. “This suggests that it may dampen his bid to return to office when he seeks re-election in February 2019,” another source said. Unemployment rate in Nigeria averaged 10.63 percent from 2006 until 2017. It reached an all-time high of 19.70 percent in the fourth quarter of 2009 (the peak of the global financial crisis) and a record low of 5.10 percent in the fourth quarter of 2010 (the period of high oil prices). Abubakar says he will end the multiple exchange rate system so as to attract more foreign investment into the country, if elected president in the February 2019 general elections. This will in turn help create jobs and reduce unemployment, he said. The Nigerian Graduate Report, released last week by Stutern, in partnership with BudegIT Co. and Jobberman, said that unemployment among Nigerian youth (15 - 35 years) ‘‘stands at a staggering 53 percent, which is significantly higher relative to previous years.’’ Stutern said that the report is timely because of the urgency needed to address the challenges in Nigeria’s labour market, and argued that Africa’s most populous nation faces one of the worst unemployment crises in its history. Although it is expected that the

Zainab Ahmed, the Minister of Budget and National Planning, Udoma Udo Udoma, Central Bank Governor, Godwin Emefiele, Director General of the Debt Management Office (DMO), Patience Oniha, and Director General of the Budget Office of the Federation, Ben Akabueze. The Joint Lead Managers for the issuance were Citibank Global Markets Limited and Standard Chartered Bank and the financial advisors were FSDH Merchant Bank Limited. Commenting following the successful pricing, Ahmed said: “Nigeria is investing strategically in critical capital projects to bridge our infrastructure deficit, provide a better operating environment for the private sector, and improve the standard of living of our citizens. The proceeds of this issuance will provide critical financing for projects in transportation, power, agriculture, housing, healthcare and education as well as the capital elements of our social investment programmes. Nigeria’s Economic Recovery and Growth plan is delivering results.” Commenting on the pricing, the DMO Director General, Oniha said: “Nigeria’s continued ability to access the international markets to raise capital is a testamenttoinvestor’sconfidencewhich has been supported by continuous engagement with them on various reform initiatives and outcomes. The issuance of the Eurobonds, which received the prior approval of the Executive and Legislative arms of government, will not only provide capital to finance various projects, but also contribute towards the achievement of the Debt Management Strategy. The ability to raise US$2.86 billion, which is the exact amount governmentneededinvolatileandchallenging marketconditionshasbeendescribedas a stellar outcome ” While Nigeria’s low debt to GDP ratio suggests there is still room for more borrowing, it is its debt service as a percentage of revenue that has drawn widespread concerns. In 2017, Nigeria’s debt service to revenue ratio ballooned to a record

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high of 69 percent which implies that for every naira earned, the country spends 69 kobo servicing debt, leaving just 31 kobo to spend on infrastructure or educate its rising population. The new $2.8 billion borrowing, will put further pressure on the already high debt service to revenue ratio. In the second quarter of 2018, Nigeria spent a total of $202 million servicing debt raised from a mix of multilateral borrowers and private investors, according to DMO data. That takes the amount spent servicing external debt this year to $427 million, having spent $225 million in the first quarter. Forecasting with the half year trend, external debt service payments could hit $854 million by year-end, 84 percent higher than the $464 million spent in 2017. The estimated external debt service costs for 2018 is 19 percent of the Federal Government’s oil earnings in 2017. The second quarter debt service cost of $202 million represents a 248 percent increase from the comparable period of 2017 when $58 million was spent servicing foreign debt. The amount is $109 million shy of the $331 million spent servicing external debt in the whole of 2015. Commercial bonds soaked up the largest chunk of the payment in Q2 2018, with 56.5 percent, while multilateral loans and bilateral loans accounted for 25 percent and 7.9 percent respectively. Agency fees and oil warrant accounted for 10.3 percent. The Federal Government earned N2.7 trillion in oil and non-oil revenue in 2017, the lowest since 2011 when the government earned N2.56 trillion. Thatimplies revenue toGDP ratioof 2.3 percent, the lowest in at least a decade. Already, the Federal Government’s total non-debt recurrent expenditure of N2.8 trillion in 2017 was more than its total 2017 revenue. Yields on the Eurobond maturing 2047 closed higher at 8.75 percent from a yield of 7.625 at issuance, showing a rise in risk perception for the country as oil prices dipped yesterday.

Nigerians studying in the US rise to a... Continued from page 2

return to economic growth in Q2 2017 following five consecutive quarters of negative growth should provide an impetus to employment, analysts fear that the current rate if released would be much worse than the 2017 figure, especially given the slow pace of economic growth in the country. “We do not think the pace of recovery is strong enough to encourage businesses to raise their demand for labour,” analysts at Lagos-based CSL Stockbrokers, a wholly owned subsidiary of FCMB Group Plc said. “That said, as the macroeconomic conditions continue to improve, underpinned by improved liquidity in the FX market, favourable oil prices and improved domestic production of crude, we expect unemployment to decline gradually.” Nigeria’s GDP growth as at Q2 2018 slowed to 1. 5 percent from the 1.95 percent that was recorded during Q1 2018 while population stood at 198 million, according to NBS data. Ayodele Teriba, CEO, at Economics Associates told BusinessDay, “We cannot expect unemployment to improve in an economy that is experiencing per capita decline. The latest figure of our GDP growth is 1.5 percent showing that our GDP is growing less than 2 percent while the population is growing at 3 percent and that has been the case since 2015.”

Thursday 15 November 2018

eral government’s failure to honour a 2009 funding agreement with the union. Similar strikes by ASUU in the past disrupted the academic programmes of public universities and in some cases led to elongation of periods that students spend to complete courses. “The constant emergence of strikes from the Academic Staff Union of Universities (ASUU), which makes Nigerian students spend longer than what is required to study, low funding of the universities makes them to be poorly equipped to give the kind of education that the modern digital economy requires,’’ Ayo Akinwunmi, Head of Research, FSDH Merchant Bank told BusinessDay by phone yesterday. He added that Nigerians are drawn to the USA by scholarship opportunities that are available for study there. The desire by Nigerians to acquire the ‘‘qualitative knowledge’’ that is available outside the country is also another factor responsible for the rise, says Ernest Odior, who teaches economics at the University of Lagos. ‘’The quality of education offered there is better than the one that we have here,’’ Odior said by phone yesterday. ‘’We do not have the hardware, though we have the manpower. So people go to America to study because of the exposure to higher studies,’’ explained Odior, who said he did his PhD ‘‘partially’’ abroad. Many Nigerians also prefer to study in the US because ‘’the American system is a bit faster than the Nigerian system,’’ says Odior, so they go there to

complete their studies on time. He also believes that many Nigerians flock to the US to study because there are job opportunities there. ‘‘Once they finish their studies there they have the opportunity to get jobs.” This view is supported by Akinwunmi, who said that the poor quality of education in Nigeria could lead to brain drain. “We need policy reforms that will upgrade our educational system in Nigeria,’’ he said. Johnson Chukwu, CEO, Cowry Asset Management Limited warns that preference for foreign schools by Nigerians will not be in Nigeria’s interest, given the cost implications. “There will be a capital outflow from the local economy. When there is an outflow of students to any country, you will notice the burden on foreign exchange because we have to pay for those services with our foreign reserves,’’ he said. The report by Open Doors also shows that in the sub-Saharan Africa region, Nigeria ranked as the number one source of African students studying in the U.S, followed by Kenya with 3,322. Ghana came in third with 3,213, Ethiopia fourth with 2,118, while South Africa had 2,040 students. Thereport,preparedbytheInstitute of InternationalEducation(IIE) and the U.S Department of state’s Bureau of Educationaland CulturalAffairs (ECA), highlights the impact of international education on the U.S higher education sector. It also examined the numbers and profile of international students in the U.S in 2017/18 and of U.S students receiving academic credit for studying aboard in 2016/2017.

Thursday 15 November 2018

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BUSINESS DAY

NEWS

BPE hires KPMG to advise on NIPOST overhaul ENDURANCE OKAFOR

igeria’s Bureau of Public Enterprises (BPE) has hired KPMG LLP to advise it on plans for the “restructuring and modernization” of the stateowned Nigerian Postal Service (NIPOST), the Abuja-based privatization agency said in an emailed statement. The six-month contract will ensure the postal company is “commercially viable and attractive to customers,” Communications Minister Adebayo Shittu said in the same statement.

The Nigeria Postal service Department came into being with the establishment of the Nigeria Telecommunications Limited (NITEL) on January 1, 1985. NITEL emerged from the merger of the Telecommunications arm of the defunct Post and Telecommunications Department of the Ministry of Communications with the former Nigeria External Telecommunications Limited (NET). Through the promulgation of decree No. 18 of 1987, NIPOST became an Extra-Ministerial Department.

Nigeria’s rice import to increase by 3.4m MT in 2019 – USDA ... to become biggest importer after China Endurance Okafor

y 2019, Nigeria is projected by the U.S. Department of Agriculture (USDA) to become the world’s biggest rice importer after China by a whopping jump of 13 percent to 3.4 million metric tons in the period. According to the latest Rice Outlook report released Tuesday, “China and Nigeria are projected to remain the largest rice importing countries in 2019, followed by the EU, Cote d’Ivoire, and Iran,” the USDA also cited that “Nigeria and Egypt are projected to account for the bulk of the 2019 import increase.” The USDA rice outlook projection for Nigeria however contradicts the optimism by the government of Africa’s largest economy to become rice self-dependent in the nearest future. Vice President, Yemi Osinbajo had said in 2018 that Nigeria will stop importing rice into the country within the next one year owing to the Federal government interventions in rice production. “We only import 2 percent of rice into the country presently and this is because we are funding agriculture and production of rice locally,” he said. He noted that Nigeria was spending $5 billion yearly on the importation of rice before the FG government intervention programme to boost local rice production. According to him, “today, only two per cent of rice consumed here are imported while the remaining 98 per cent are locally produced, since we came to power, we have been funding agriculture and encouraging our farmers across the country so as to be self-sufficient in food production.” Osinbajo said in early 2018. According to data from Bloomberg terminal, rice production in Nigeria had increased more than 50 percent since 2012 to 3.7 million tons last year. Domestic demand rose 4 percent to 6.7 million tons in the 2017-18 year that ended in May, leaving gap of 3 million tons.

However according to Lai Mohammed, Nigeria’s Minister of Information and Culture, Nigeria in 2014, imported 1.2 million metric tonnes of rice, 644 metric tons in 2015, 644 metric tons and 5,000 metric tons in 2016 and 2017 respectively. In an earlier report released by the Washington-based organisation in October, Africa’s most populous nation with about 200 million people recorded a poor performance in rice production. However Nigeria’s government discredited it as “fake” and “untrue.” “I want to say categorically that the story is fake and immediately that story broke out, I contacted Central Bank of Nigeria and Comptroller General of Customs, I had meetings with the Rice Producers’ Association and also with the Millers and they all confirmed that, that story is not true,” Mohammed had said. Mohammed said the Federal government Anchor Borrowers Rice Programme is working, adding that “Nigeria has been able to reduce by 90 percent the $1.65 billion it was paying on rice importation, and increase the number of integrated rice processing Mills increased from 13 to 25.” Nigerian rice farmers have been hit by insecurity, higher input costs and widespread flooding in the main rice growing states of the country. Mohammed Sahabi, chairman of the Rice Farmers Association of Nigeria in Kebbi, one of the country’s main rice-growing states, said “the rain has not been favorable to rice farmers this year, we lost more than 20,000 hectares of unharvested rice this year in Kebbi alone.” Meanwhile, the USDA rice outlook report which examines supply, use, prices, and trade for rice, including supply and demand prospects in major importing and exporting countries disclosed that the current global rice production exceeds consumption by 2.3 million tons, with 2018-19 “global ending stocks” projected to reach 163 million tons, 17.8 million tons more than previously forecast.

Nigeria’s presidential candidates confronted with litany of moribund industries ODINAKA ANUDU

s political campaigns begin next week, presidential candidates are confronted with unveiling a practical blueprint for reviving hundreds of moribund industries around the country. Incumbent President Muhammadu Buhari of the All Progressives Congress and opposition candidate Atiku Abubakar of the People’s Democratic Party are two main contenders to the seat of president. Theyarefacedwiththetaskoftelling Nigerians what they intend to do with the Ajaokuta Steel Complex , which has gulped $8 billion public funds without producing one sheet of steel. Since 1994, successive governments have claimed that the complex is 98 percent complete, but the remaining two percent has become a hard nut to crack for successive administrations. Muhammadu Buhari’s government budgeted N3.9 billion in 2016 and N4.27 billion in 2017 for the resuscitation of the steel, despite an earlier business case in the last administration showing that the complex could only work if properly privatised. BusinessDay checks show that Ajaokuta Complex has the capacity to produce one million metric tonnes of steel, one million metric tonnes

of coal , manganese and limestone, among others. Due to lack of operations at Ajaokuta Steel, Nigeria today imports steel valued at $3.3 billion every year. Frank Udemba Jacobs, immediate past president of the Manufacturers Association of Nigeria (MAN), said over 50 percent of raw materials used in the sector would have been locally available had Ajaokuta been working. Similarly, the Aluminium Smelter Company,locatedinAkwaIbomState,is not in operation due to a tussle between Bancorp Financial Investment Group Divino Corporation (BFIG), a consortium of U.S.-based Nigerian investors led by Reuben Jaja, and the United Company RUSAL, a Russian firm. “We need that resolved. Aluminium Smelter Company needs to be re-started so that we can get ingots for local roofing sheets manufacturers,” Oluyinka Kufile, chairman, Basic Metal, Iron and Steel Group of the Manufacturers Association of Nigeria (MAN), told BusinessDay earlier in an interview. Nigeria has three paper mills that are not working at optimal capacity. These include: Nigeria Paper Mill (NPM)Limited located in Jebba, Kwara State; Nigerian Newsprint Manufacturing Company (NNMC) Limited, Oku-Iboku, Akwa Ibom State; and Nigerian National Paper Manufacturing Company (NNPMC)

Limited in Ogun State. Studies show that Nigeria loses N180 billion annually from nonperformance of these paper mills. Nigeria spends N50 billion on the import of papers annually, according to a research done by Abimbola Ogunwusi and Peter Onwualu, director and former director-general of the Raw Materials Research and Development Council (RMRDC). Newspapers and publishing firms are struggling to import papers with limited foreign exchange, leading to very high cost of paper products. Nigerian manufacturers borrow from commercial banks at 23 percent. They spent N51.35 billion on alternative energy in the second quarter (H2) of 2017; N66.03 billion in the first half (H1) of 2017; N62.96 billion in H1 of 2016, and N69.99 billion in H2 of 2016 and self-generate over 13,000 megawatts of electricity, according to MAN, As of today, many private companies are either shut down or mired in intractable legal tussles. Vita Malt in Agbara, Ogun State, is shut down. Multi Trex, a 65,000 metric-tonne cocoa processing factory, the largest in the country, has been taken over by the Asset Management Company of Nigeria (AMCON).

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L-R: Anthony Arabome, immediate past president, Chartered Institute of Personnel Management of Nigeria (CIPM); Nkeiru Adesogan, national treasurer, CIPM; Udom Inoyo, president/chairman of council, CIPM; Olawale Adediran, vice president, CIPM, and Ajibola Ponnle, registrar/CEO, CIPM, at the opening ceremony of the 50th Annual National Conference of CIPM in Abuja, yesterday.

IJINLE: Osun launches initiative to revive traditional Yoruba fashion

n almost dying traditional Yoruba fashion is in the verge of revival due to a new initiative launched yesterday by Governor of Osun State Rauf Aregbesola. Tagged ‘Ijinle,’ the project is an entrepreneurial initiative aimed at commercially reviving the traditional and unique fashion of the Yorubas in Southwest Nigeria. It is built around the veteran, Kabiru Durojaiye, a custodian of the age-old and fast-dying Mastercraftsmanship in Vintage Yoruba Tailoring, which is the traditional way of making Yoruba wears. To preserve Kabiru’s skills, Osun organised an entrepreneurship project, through which 15 promising young tailors were competitively selected to intern with Kabiru over 18 weeks to learn

the intricate details of producing vintage traditional Yoruba fashion pieces and new products. The 15 interns graduated from their internship at an elaborate ceremony held November 12 at Terra Kulture, Lagos in the presence of the governor of Osun as well as the incoming governor, Gboyega Oyetola; Ooni Of Ife, Oba Adeyeye Ogunwusi, chairman, Federal Mortgage Bank of Nigeria, Wale Adeeyo; Adebola Williams; Founder, LDA Couture, Lanre Da Silva. The 15 interns are the first stream of trainees to power a new fashion social enterprise focused on preserving vintage Yoruba tailoring tagged the Ijinle. The event was hosted by musician, Sound Sultan and Segun ‘Laff Up’ Ogundipe. The Ijinle product line was also launched at the event. Ijinle Vintage,

Ijinle Millenial and Ijinle Smart, with Big Brother Nigeria 2018 contestant, Tobi Bakre joining the runway models to showcase the innovative Ijinle vintage and smart pieces. In keeping with the project’s goal of advocating for further adoption of indigenous fashion in public and private sector for the purpose of boosting the local economy and a Nigerian identity, the event featured Ojoma Ochai, Director of Arts West Africa, British Council who made the case for the government toevolvepracticalpoliciestoexpandthe demand side in boosting the Nigerian Garment value chain given that the country currently spends $4 billion yearly on imported clothes.

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Thursday 15 November 2018

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BUSINESS DAY

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Thursday 15 November 2018

FINANCIAL TIMES

World Business Newspaper

Theresa May seeks support for draft Brexit treaty Divided cabinet faces crucial showdown at 2pm meeting George Parker, Jim Pickard and Alex Barker

rime Minister Theresa May will on Wednesday challenge her divided cabinet to back a draft Brexit treaty, as Tory Eurosceptic MPs warned that they could try to topple her if she presses ahead with her plan. The historic cabinet meeting comes after negotiators in Brussels ended months of talks by agreeing Britain’s terms for leaving the EU. Mrs May now has to sell it to her cabinet and parliament. Cabinet ministers were given their first sight of the draft withdrawal treaty and an accompanying outline of a political declaration on the future EU/UK relationship on Tuesday evening; Number 10 was relieved that none of them resigned overnight. Mrs May also took comfort from an unexpectedly warm welcome for her deal from some Tory newspapers. “This Brexit deal is best for Britain,” said the Daily Express headline on Wednesday morning. The Daily Mail’s leader said: “A deal at last! Now give it a chance.” Yet the cabinet meeting, beginning at 2pm, and the subsequent parliamentary battle to approve the Brexit deal represent the most dangerous moments in Theresa May’s premiership. Labour leader Jeremy Corbyn

attacked the government’s “failure” to bring back an acceptable deal from Brussels as his opposition Labour party geared up to vote against the agreement in the coming weeks. Mr Corbyn said during Wednesday’s prime minister’s question time that the “shambolic mess” of a deal breached the government’s own lines and failed to deliver a “Brexit for the whole country”. “From what we know of the government’s deal it’s a failure in its own terms,” he told the House of Commons. But Mrs May insisted that the text would allow the country to take control of its borders, its laws and its money while protecting jobs and the integrity of the UK. “We are significantly closer to agreeing on what the British people voted for in the referendum,” she said. On Tuesday night, Jacob ReesMogg, leader of the pro-Brexit European Research Group, said he was considering joining other Tory MPs in calling for a vote of no-confidence in Mrs May. Boris Johnson, former foreign secretary, claimed Mrs May would leave Britain “a vassal state” to the EU. The Brexit Files: How will Brexit affect immigration? The Democratic Unionist party, which props up Mrs May’s government, also warned it could vote against the deal, raising the

Nigeria dials up mobile banking revolution Country’s banking system is being opened to non-financial groups like telecom operators

Neil Munshi

second quarter of next year. Mazen Mroue, chief operating officer of MTN Nigeria, argued there was “big potential” to convert the carrier’s 50m Nigerian customers into mobile money users. “We’ve already laid the foundation so it becomes easier to extend these services,” he told the Financial Times at his office in Lagos. “This is an opportunity for all stakeholders to work together, and use existing telco infrastructure to assist all of the unbanked . . . we’re open for collaboration with any player that really wants to leverage our infrastructure.” Nigeria has plenty of catching up to do. Kenya’s Mpesa has signed up 23.4m users — some 80 per cent of the adult population — becoming the de facto technique for transferring money for many people in the east African country. Nigeria’s economy is five times the size of Kenya’s, underlining the scale of the opportunity. More than 60m of Nigeria’s roughly 200m people do not have bank accounts. MTN is in prime position to sign many of them up to a mobile payments service, not least because of vast agent network. Continues on page A3

The cabinet meeting and subsequent parliamentary battle represent the most dangerous moments in Theresa May’s premiership © PA

prospect that the deal could be defeated when it goes before the House of Commons, probably next month. The DUP’s Jeffrey Donaldson told BBC Radio 4’s Today on Wednesday that from “what we have heard . . . this deal has the potential to lead to the break-up of the United Kingdom and that is not something we can support”. But Mrs May was confident she could cross her first hurdle — this afternoon’s cabinet meeting — without a significant number of resignations, although Downing Street feared that Eurosceptic

ministers Penny Mordaunt and Esther McVey may quit. Dominic Raab, the Brexit secretary who was sidelined in the final stages of negotiations in Brussels, declined to say on Wednesday if he would support the deal. If he or other highprofile Eurosceptic ministers resigned, Mrs May would be in serious trouble. While Mr Rees-Mogg and Mr Johnson were cranking up pressure on Eurosceptic cabinet ministers to mutiny, William Hague, former Tory leader, said that Mrs May had secured the best pos-

sible deal in the circumstances. “They have to stick together above all,” he said. “Unless this cabinet sticks together, there is no alternative government sitting there.” Lord Hague said the alternative to Mrs May’s deal could be no Brexit at all. If the cabinet approves the agreement, Mrs May and the EU are expected to publish the full draft withdrawal treaty, which runs to more than 400 pages, and the accompanying statement on future relations running to about 15 pages on Wednesday afternoon.

Energy shares track oil price rebound Wall St rises and energy stocks fight back; pound volatile as Brexit dominates Michael Hunter and Alice Woodhouse

rebound for oil prices helped energy stocks off the worst of their lows and a move higher on Wall Street after US inflation data met forecasts helped European bourses turn positive overall. Brent, the international oil benchmark stabilised — up 2.4 per cent to $67.01 — after a 7 per cent slide over the previous session, when fears that increased supply from the US would coincide with a slowdown in the global economy harried the market. Opec cut its forecasts for world oil demand in 2019 and said supply growth from outside the exporters’ organisation would outstrip demand. West Texas Intermediate, the US contract, regained 2.9 per cent to $57.29 a barrel. It fell more than 7 per cent over the previous session. Oil majors were weaker across the globe, but off their lowest levels of the day as oil prices fought back. The Stoxx index tracking the sector in Europe fought back to trade just slightly lower, having been down by as much as 2 per cent. BP was up 0.2 per cent and Total added 0.7 per cent.

There were bigger moves in China, which came before the best extent of oil’s rebound. Cnooc fell 4.7 per cent, its lowest in almost three months. PetroChina lost 2.7 per cent. Equities Wall Street indices rose after US consumer price inflation data met forecasts, and did little to imply that the Federal Reserve might have to increase the pace of its interest rate rises. The S&P 500 was up 0.3 per cent, having fallen by 0.2 per cent overnight. European bourses bounced off some of their lowest levels in two weeks. The region-wide Stoxx 600 was down 0.3 per cent, with the German Xetra Dax flat and the FTSE 100 up 0.2 per cent. Ho ng Ko ng ’s Ha ng S e ng dropped 0.5 per cent, led lower by the energy sector. On China’s mainland, the CSI 300 lost 1 per cent after government data showing retail sales in China grew at the slowest pace in five months in October. A fall for the energy sector also dragged down Australia’s S&P/ ASX 200. The index was off 1.7 per cent, hit by its dominant energy and mining stocks. Japan’s Topix managed to buck the trend, bouncing up 0.2 per

cent in a broad rebound from the previous session’s 2 per cent loss, although its energy stocks missed out. Forex and fixed income Sterling continued to track nerves surrounding the UK government’s ability to get domestic approval for the Brexit deal agreed between the government and the EU. Investors kept watch on the process as a cabinet meeting on the terms got underway, which then have to go before Parliamen. Sterling faded from gains made immediately after news a deal had been struck. It was down 0.2 per cent on the day versus the dollar, at $1.2999, and was steady against the euro, with a unit of the shared currency costing £0.8698. “With such a wafer-thin working majority, and the population seemingly cooling to the idea of a Brexit, whatever form it takes, opposition politicians will have little incentive to back a deal that, if they withheld their support, would likely see the end of PM May, and possibly raise the prospect of a general election.” The dollar’s rally paused, with the index tracking the world’s reserve currency down 0.2 per cent. The euro was up 0.2 per cent at $1.1317.

Thursday 15 November 2018

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NATIONAL NEWS

BUSINESS DAY

Nigeria dials up mobile banking revolution...

South Africa minister quits over perjury scandal

Continued from page A2

Resignation boosts Ramaphosa government’s credentials in fight against corruption

There is barely a village or market across Nigeria’s 924,000 sq km, no matter how remote, without someone at a yellow MTN table selling phone credit. Banks find it uneconomical to serve low-income customers who generate little revenue, said Karima Ola, who leads African deals at Leapfrog Investments, a private equity fund focused on companies serving consumers earning $2-$10 a day. Such customers also have difficulty accessing banking facilities. “For some of these customers, you [join together] and give six to seven of your debit cards to a guy on a bicycle who rides three miles to the ATM — think of the risks involved there,” she said. “The solution is agency banking, where you have a local agent who can take money and [disburse money]. Who has the biggest number of agents in the country? It’s the telcos.” Banks cannot afford to put branches in every corner of the country — for logistical, economic and security reasons. But MTN has agents scattered throughout, for instance, in Borno State, which has borne the brunt of the Boko Haram insurgency. There are challenges to MTN’s position. Edward George, head of research at Ecobank, said: “MTN’s market share has been falling steadily for the last five years . . .[and] we’ve seen both Airtel and Glo gaining market share and growing strongly.” Airtel has developed a mobile banking service in its home market of India, while 9 Mobile, the company that rose from the ashes of the bankrupt Etisalat Nigeria, could use it as an opportunity to gain market share, said Mr George. Other groups that could benefit from the spread of mobile money include the Rocket Internetbacked ecommerce group Jumia and digital financial services providers such as Paylater, which provides microloans. “Our market is limited right now to the banked and there are more unbanked than there are banked in Nigeria,” Paylater’s chief executive Chijioke Dozie. “If more of the unbanked started going into these payment systems, or digitising their [savings] through mobile money wallets then we can definitely service them.” By waiting a decade longer than countries such as Kenya to embrace mobile banking, Nigeria has avoided some pitfalls, such as struggling to keep track of the money flowing through the telecom groups providing the new services, said Mr Dozie. “The [Nigerian] central bank has probably been cautious in terms of not trying to rush into the mobile money space given they want to ensure that they can monitor what goes on,” he said. “The telcos are not regulated by them, so they’ve tried to marry [financial institutions] and telcos [in order to] regulate them adequately because this will have a huge effect on the financial system.”

Joseph Cotterill

Congo’s opposition unity dissolves within 24 hours Re-emergence of divisions boosts president’s party ahead of December election Tom Wilson

he opposition in the Democratic Republic of Congo was plunged into chaos after two popular leaders withdrew their support for a unity candidate in next month’s presidential election less than a day after he was anointed. Congo’s opposition parties had promised to join forces to unseat President Joseph Kabila’s ruling party for the past three years. In the end, their hardwon unity dissolved within 24 hours. Félix Tshisekedi, leader of Congo’s biggest opposition party, and Vital Kamerhe, who finished third in the last vote in 2011, had agreed with five other leaders to back Martin Fayulu in the election on December 23. But they backtracked on their selection on Monday, when both men told the Congolese press their parties had rejected the decision to support Mr Fayulu. The re-emergence of divisions is a major setback for the opposition in an election where the ruling party appears intent on doing everything it can to hold on to power. Having already delayed the vote for

two years, Mr Kabila named a successor to run in his stead in August and has bolstered the ruling coalition’s party structures and campaign resources in the past six months. Mr Fayulu was seen as a compromise candidate for a group of opposition leaders who have often struggled to work together because of personal rivalries and mutual suspicion. A former ExxonMobil businessman, Mr Fayulu leads a party that controls only three seats in the country’s parliament and lacks the national-level support of some of the other leaders. Still, he has been a consistent opponent of Mr Kabila’s presidency for at least 10 years and earned a reputation as a brave leader willing to stand side by side with protesters. Other leaders have vacillated between co-operation and confrontation. Moïse Katumbi, the former provincial governor turned opposition figure, who was one of the leaders that agreed to support Mr Fayulu on Sunday, told the Financial Times that he remains fully behind the candidate, despite the defections. “What counts in life is consistency, and Fayulu has demonstrated that,” Mr Katumbi said. “If we are going to sup-

port a candidate to bring back peace, to bring back confidence from investors, then that candidate is Fayulu,” he said. Mr Fayulu told the Financial Times that he was due to speak with Mr Kamerhe and Mr Tshisekedi and would urge them to re-join the opposition coalition. “This is the unity that the people of Congo are asking for,” he said. “We cannot miss this opportunity.” Mr Katumbi said the remaining Fayulu supporters would begin campaigning for him immediately. The opposition talks that resulted in Mr Fayulu’s selection were mediated by the Kofi Annan Foundation. Mr Kamerhe and Mr Tshisekedi, along with the other five political leaders, both agreed they would end their political careers if they failed to respect the outcome of the dialogue, according to signed letters published on Tuesday by the foundation. Mr Kamerhe and Mr Tshisekedi could not be reached for comment. In a show of confidence AndréAlain Atundu, the ruling coalition’s spokesman, said the chaos within the opposition ranks was a “non-event”. “We are not running a campaign against the opposition, we are campaigning on our strengths” he said.

German economy contracts for first time in more than 3 years Fall in exports to China combines with auto industry problems to hit growth Claire Jones

ermany, Europe’s largest economy, contracted for the first time in more than three years, shrinking by 0.2 per cent between the second and third quarter on the back of a fall in exports. The drop, the first since the first quarter of 2015, complicates the task of the European Central Bank ahead of a crucial meeting in December, when monetary policymakers are expected to confirm that they will withdraw one of the most important elements of the bank’s crisis-era stimulus. Growth in the eurozone’s economic powerhouse, which has consistently outperformed other economies in the region, was expected to be weak on the back of delays in German automakers’ compliance with new EU emissions standards. While the automakers’ woes are expected to be temporary — with demand for vehicles bouncing back once the new standards are met — the contraction was slightly sharper than expected. It suggests that Germany’s

economy, which provides almost one-third of all eurozone output, is being badly affected by the global trade war between the US and China. “Even without [the effect of the automakers’ woes], the German economy would hardly have grown at all due to declining demand from China,” said Jörg Krämer, chief economist at Commerzbank, who said he would cut his forecast for German growth this year from 1.8 per cent to 1.5 per cent — much lower than the 2.2 per cent recorded for 2017. The problems of the automotive sector knocked a quarter of a percentage point off gross domestic product growth, according to Commerzbank estimates. “The slight quarter-on-quarter decline in the gross domestic product was mainly due to the development of foreign trade. According to provisional calculations, exports were down while imports were up in the third quarter of 2018 compared with the second quarter of the year,” the federal statistics office said. “As regards domestic demand, there were mixed signals. While

gross fixed capital formation both in machinery and equipment and in construction was higher than in the previous quarter, final consumption expenditure of households declined. Government final consumption expenditure was slightly higher than in the previous quarter.” The German figure follows disappointing figures for the eurozone as a whole in the third quarter. The eurozone’s economy expanded by just 0.2 per cent, down from 0.4 per cent in the second quarter — the smallest expansion in more than four years. Italy’s economy did not grow at all. In the second quarter, Germany’s economy grew by 0.5 per cent. The ECB will almost certainly say that it will stick with plans to end the expansion of its €2.6tn quantitative easing programme at the end of this year. Mario Draghi, its president, had already acknowledged last month that German automakers’ failure to meet the new standards would weaken growth, but said this only mattered in the short term and the region’s economy was still “solid”.

alusi Gigaba has quit as South African home affairs minister in the wake of a perjury scandal, solving a political predicament for Cyril Ramaphosa and boosting his government’s claim to tackle misrule. Mr Ramaphosa’s office said on Tuesday that he had accepted the resignation of Mr Gigaba, a former finance minister who said he was leaving “to relieve the president from undue pressure” over a court’s finding that he lied under oath. The resignation caps a dramatic fall from grace for Mr Gigaba, who was once a rising star in the ruling African National Congress and an ally of former president Jacob Zuma, who rewarded him with the top job at the Treasury. Mr Gigaba survived the downfall of his political patron this year after the ANC sacked Mr Zuma as state president and replaced him with Mr Ramaphosa. The new president pledged to root out corruption but also tried to woo Zuma allies by offering them posts. But in recent weeks a series of scandals caught up with Mr Gigaba — notably a ruling by the high court that he had lied when he claimed he had not approved a luxury private airport for the Oppenheimer business family, the subject of a protracted legal dispute. Mr Gigaba was also embarrassed by the release of a private sex tape that he said was hacked from his phone. Mr Ramaphosa was due to decide Mr Gigaba’s fate this week after South Africa’s public protector, a kind of government ombudsman, found that the minister had violated the constitution by perjuring himself. The Oppenheimers accused Mr Gigaba of reversing the approval at the behest of the Guptas, the business family at the heart of allegations that Mr Zuma oversaw “capture” of state institutions for private ends. Under Mr Zuma, Mr Gigaba also served as the overseer of stateowned companies that were allegedly looted by the Guptas. The Economic Freedom Fighters, an opposition ANC breakaway party, responded to Mr Gigaba’s resignation by calling him “a Gupta stooge who was the engine of state capture under Jacob Zuma”. The party added that Mr Gigaba “ensured that the Guptas attained citizenship in South Africa” during a previous stint as home affairs minister. Mr Gigaba has denied helping the Indian-born brothers to gain citizenship and has always denied other wrongdoing. Mr Zuma and the Guptas deny corruption. In a statement the ANC said that Mr Gigaba’s resignation was “a sign of the increasing maturity of our democracy and of leadership willing to put the country ahead of their own individual situations”. Mr Ramaphosa has appointed Blade Nzimande, the transport minister, to take over Mr Gigaba’s portfolio until a permanent successor is found.

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FG’s school feeding fails to ignite interest in Lagos JOSHUA BASSEY

he school feeding programme of the Federal Government, which implementation began two years ago, has failed to ignite interest in Lagos State, as the state government does not consider it a priority amid challenges of provision of basic infrastructure in schools, BusinessDay learns. There are about 1,017 public primary schools in Lagos State. It was gathered that although the issue received deliberations at the highest level in the state, and a provision allegedly made to capture its implementation starting from 2017, the fund had to be re-channelled to address other pressing needs. The state government, it was learnt, does see not consider feeding of pupils in public primary schools a priority that should receive special funding, as provision of basic infrastructure to ca-

... as state battles infrastructure challenge ter to the increasing pupil population in public schools in the state is more of a priority to the government at this time. Maryam Uwais, special adviser to President Muhammadu Buhari on social investment programmes in the office of the Vice President, recently said the Federal Government so far spent over N49 billion on the school feeding programmes in 26 states of the federation. The implementation of the programme requires joint funding to the ratio of 60/40 percent between states and the Federal Government. An official in the office of Lagos State deputy governor, Idiat Adebule, who doubles as commissioner for education, confirmed to BusinessDay that the school feeding programme remained a consideration that might never receive implementation. “If you look at other states that have embraced it, it is

used as a bait to draw pupils to schools. In Lagos, our public schools are full to capacity. Our priority is to provide adequate infrastructure to cater for the growing population of pupils, train and retrain teachers to provide quality education to our children. “Our priority also is to provide a conducive learning atmosphere and environment. School feeding is a good initiative, but it is not a top priority for now,” the anonymous official said. Speaking also on this, Ganiyu Sopeyin, chairman, Lagos State Universal Basic Education Board (SUBEB), said the state government was still working on how to implement the feeding programme. According to Sopeyin, there are challenges associated with it such as pupil population, reaching schools in riverian areas and other proximity challenges. The Federal Government

recently said 9,300,892 pupils across 26 states had been captured in the school feeding programme. Uwais said the school feeding programme had also engaged about 96,972 cooks with over 100,000 small-scale farmers being part of the supply chain for food items. “Being a programme that aims at empowering communities, the government has engaged 96,972 cooks with over 100,000 smallscale farmers being part of the value chain, supplying locally sourced ingredients. So far, the government is now feeding 9,300,892 children in 49,837 government schools in 26 states. It is noteworthy that currently, public schools require 6,800,000 eggs, 594 cattle and 83 metric tons of fish weekly to be supplied to the cooks, for the purpose of feeding the children,” Uwais in August said while giving update on the programme.

Thursday 15 November 2018

Nigeria to focus on women, youth, others to achieve financial inclusion target HOPE MOSES-ASHIKE

igeria is determined to achieve the financial inclusion target of 80 percent by 2020 with a strong focus on including five excluded groups - women, youth and people in the rural areas. Women, the youth (under 35 years), rural residents and those in Northern Nigeria (North East and North West) are the most financially excluded, according to a survey by Enhancing Financial Innovation and Access (EFinA). The working group and the technical group of the inclusion strategy are also working to increase the agent network to bring financial services to the people. To further enhance financial system stability, the Nigeria Deposit Insurance Corporation (NDIC) says it has embarked on various public awareness campaign explaining the role and responsibilities of the customers to their banks, and vice versa. “NDIC in collaboration

with all relevant key players in the nation’s financial system will continue to work on several initiatives to accelerate financial literacy and financial inclusion, especially among rural communities nationwide so as to promote inclusive growth in Nigeria,” Umar Ibrahim, managing director/ CEO, NDIC, said. Represented by Mohammed Yayangida Umar at the ongoing workshop for business editors and Finance Correspondents Association of Nigeria, he said the NDIC would continue to work closely with CBN to ensure effective supervision of the banks so as to ensure strict adherence to rules and regulations guiding banking operations. Speaking on ‘Financial Inclusion in Nigeria: The Journey So Far,’ Temitope Akin-Fadeyi, head, financial inclusion secretariat, Central Bank of Nigeria (CBN), mentioned some of the challenges to financial inclusion to include security, problem of economy and low literacy level among others.

NECA kicks as Nat’l Lottery Commission meddles in NB JOSHUA BASSEY

Akinwunmi Ambode, Lagos State governor (r), with Ifeanyi Odedo, national president, Full Gospel Business Men’s Fellowship International-Nigeria (FGBMFI), during a courtesy visit by FGBMFI-Nigeria at the Lagos House, Alausa, Ikeja,

Abaribe’s N100m bail bond: Court orders interim forfeiture FELIX OMOHOMHION, Abuja

Federal High Court, Abuja, Wednesday, ordered Eyinnnya Abaribe, a senator, and two others who stood as sureties for the leader of the proscribed Indigenous People of Biafra (IPOB), Nnamdi Kanu, to temporarily forfeit their N100 million bail bond each. Justice Binta Nyako also ordered that the N100 million bail bond should be converted into cash and deposited with the registrar of the court. The court ordered that the money should be paid within two months of the

order and would be permanently forfeited if after six month they were unable to produce the IPOD leader to face his trial. Kanu was arrested in 2015 on an 11-count charge bordering on terrorism and treasonable felony. Six of the charges, including that of terrorism, were struck out early 2017. Abaribe, a Jewish priest, Emmanuel Shallon-Ben, and Tochukwu Uchendu had stood as sureties for Kanu on April 24, 2017, after the court granted him bail on health grounds. This was after spending 11 months in the custody of the Department of State Security (DSS). In granting

Kanu bail, Justice Nyako asked him to produce three sureties with N100 million each. Nyako said one of the sureties must be a senior highly placed person of Igbo extraction such as a senator. She held that the other surety must be a highly respected Jewish leader since Kanu said his religion was Judaism, while the third person must be a highly respected person who owned landed property and was resident in Abuja. The judge said she was convinced that Kanu was ill and needed more medical attention than the Nigerian Prisons was giving him.

igeria Employers’ Consultative Association (NECA) has lashed out on the National Lottery Regulatory Commission (NLRC) over what the association termed “gruff actions” of National Lottery Commission’s director-general, Lanre Gbajabiamila, in shutting business premises of Nigerian Brewery (NB) plc. It would be recalled that the Lottery Commission had a disagreement with NB in 2016 over a sales promo. The commission had argued that the promote had every element of lottery, and for this reason, wrote to the NB to pay the statutory levies and commission, a position the NB disagreed with, as it insisted that it

was a promote and not lottery. The disagreement had resulted in a legal tussle. The employers’ body, in a statement issued by its director-general, Olusegun Oshinowo, and made available to the media, expressed shock and dismay at the “uncivil behaviour of Gbajabiamila in shutting down the offices and business premises of NB across the nation. According to NECA, “ Gbajabiamila’s action had failed to respect the ongoing case CA/A/207/2016, NECA & 1 or vs. AG Federation & 3 others which is connected to the issue that allegedly prompted the closure of the Nigeria Brewery Plc. NECA said that the court had earlier directed parties in the case to maintain status quo ante since 2016.”

Estate developers get value for money as FCTA moves to overhaul DDC JAMES KWEN, Abuja

state developers in Abuja are to get more value for the money they invest as the Federal Capital Territory Administration (FCTA) is set to overhaul the Department of Development Control (DDC) so that it can function more efficiently. Minister of Federal Capital Territory (FCT), Muhammad Bello, who stated this Wednesday while receiving the report of the panel of inquiry on the August 17 Jabi Building Collapse in Abuja, said the move was aimed at strengthening DDC institutional framework to enable it cope with the ever increasing growth in building activ-

ities in the FCT. Bello, who was represented by the permanent secretary, FCTA, Chinyeaka Ohaa, noted that decentralising the department would also place it in a vantage position to keep to pace with the changing profile of the Territory and improved service delivery. The minster assured that, “the recommendations contained in the report will be implemented in order to address the lingering issues of building collapse in the FCT in particular and Nigeria in general. “Building collapse, we would all agree, is a universal phenomenon that is also witnessed even in advanced countries. Regardless, the

Administration is concerned that with the calibre, number and mix of professionals in the building industry in Abuja and indeed Nigeria, the incidence of building collapse can be curtailed to the barest minimum in the country in general and the FCT in particular.” Danladi Matawal, a professor of Civil Engineering and chairman of the Panel of Inquiry into the Jabi Building Collapse, while presenting the report, recommended massive injection of staff in the FCTA Department of Development Control by recruiting engineers, architects and also the use of qualified FCDA pool of field officers to forestall incidences of building collapse.

Thursday 15 November 2018

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BUSINESS DAY

Innovation

Apps

Fin-Tech

Start-up

Gadgets

Ecommerce

IOTs

A6 BUSINESS DAY

Broadband Infrastructure C002D5556

Bank IT Security

Thursday 15 November 2018

How AI can save Nigeria from multi-billion dollar illegal logging CALEB OJEWALE

n what could be described as an unusual place to find a solution to Nigeria’s illegal logging problem, the Making AI event by Google in Amsterdam has revealed a possible solution to the illicit trade, which also threatens environmental sustainability. Millions of trees from Nigerian forests have been lost to illegal logging over the years, and a report by the Environmental Investigation Agency even suggested that, as much as $1 billion could have been realised in the illegal trading of logs from Nigeria just within a four-year period. It was also reported that sometime in 2016, 1.4 million logs of rosewood valued at $300 million were seized by Chinese authorities after being shipped from Nigeria. There have been in-

sinuations that the logs were illegally cut and taken from Nigeria, claims that are now hard to establish as the shipment got released under what some environmental right groups describe as ‘controversial circumstances’. However, with the application of Artificial Intelligence, Nigeria may be able to combat this illegal activity, which also wrecks havoc on the environment. The best part of this is that the technology could be made available for free, once there is an expression of readiness and commitment from organisations in Nigeria with interest in environmental sustainability. The technology, developed by Rainforest Connection, a non-profit establishment, uses Google’s TensorFlow machine learning framework in detecting the sounds of chainsaws and logging trucks in the forest.

The innovation is the work of Topher White, CEO of Rainforest Connection, who developed the platform to collect audio data from the forests, through old cell phones placed on trees, transmitting this data which is then processed and sends immediate alerts to local groups/authorities when logging activities are detected. The technology developed by Rainforest Connection uses old cell phones that are thrown away, putting them up in trees with solar panels, and equipped with microphones. They listen to all the sounds in the forest and stream through the internet. This, as White explained is then analysed with artificial intelligence for logging trucks, chainsaws, gunshots etc, subsequently, alerts are sent to local groups on ground. White in an exclusive in-

terview with BusinessDay, explained that the old cell phones placed on trees, “listen to all the sounds in the forest and stream it up to the cloud where we then analyse it for chainsaws, logging trucks, gunshots, motorcycles. Things that indicate damaging activity and then we send alerts to local partnerships like tribes and NGOs who can show up and stop it in real time. Also, we have built tools to make law enforcement available to them as well as legal action.” According to White, similar projects have been executed in Cameroun, in a sustainable logging reserve called Mbang, and there are new projects in Democratic Republic of Congo (DRC) and South Africa. There are potentials for the application of this technology in Nigeria, and Rainforest Connection is eager to do something in the

country. “We would love to operate in Nigeria, especially also because Nigeria is a hub of technological innovations. It will be great for us to work out there with people that can help improve the technology. For us, everything depends on the partnerships, because it does not matter if we detect illegal logging and there is nobody there to stop it. “We have not had any groups come to us from Nigeria that want to use the technology, but if anybody will like to use it to catch illegal logging or just conservation in general, we would love to work with them,” White told BusinessDay. Setting up in a new country costs $25,000, but White explained that when a group approaches the company for the technology to be provided in any area, they could help raise funds for such operations. This, according to

him, is predicated on the sincerity of those requesting for the technology, even though it is faster to deploy when funding is already available. The ($25,000) setup will cover about 100 square kilometres (approximately 10,000 hectares) for a few years, but can cover more area by focusing installations on roads and periphery of the target area. Acknowledging Google’s impact, White noted “without Google, we wouldn’t be able to do any of what we do. And I think in doing so, we have become a great example of how their tools can be used in helping people in a lot of these remote places.” Bridget Gosselink, head of product impact at Google. org, also told BusinessDay, “apart from the tools, Google has been consulting and providing advice on how they can improve the AI in their models (for better impact).”

How Interswitch blockchain service eases pressure on low SME financing FRANK ELEANYA

nterswitch in partnership with Microsoft, unveiled a supply chain financing service that rides on blockchain technology on the first week of November. The first of its kind innovation has an ambition to practically reduce the pressure that small businesses face in accessing funding from big financial institutions like banks. Easy access to finance is a major problem facing many small businesses in Nigeria and perhaps the rest of Africa. Many of them have gone out of business for not being able to get funding. In view of that, financial technology (fintech) startups came up with different solutions aimed at increasing access to funding by reducing the documentation requirements that traditional institutions will usually request. With Blockchain however, the traditional financial institutions can fund small businesses without fear of the high risk. Interswitch explained in a statement that the service which is built and hosted using the Microsoft Azure Blockchain platform brings together entrepreneurs, big financial players and corporates organisations to provide end-to-end visibility that ensures fast and seamless trade financing in supply chain operations. It is not only the first time such a service is offered in Nigeria, it is also epoch-making in the sense that it is the first

time corporate entities including traditional financial institutions are openly embracing blockchain technology. The Interswitch blockchain service highlights the point that there are more uses of the technology beyond cryptocurrencies. Cryptocurrencies have become the only way most individuals and even businesses define blockchain technology. Blockchain technology, however, refers to an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value. The blockchain database is not stored in any single location, in other words, the records it keeps are truly public and easily verifiable. By leveraging the Microsoft Azure Blockchain technology, Interswitch gives financial institutions that are willing to lend or finance small businesses the leverage to monitor their investments. It not only provides security as lending institutions now have a way to verify their investments, it also ensures transparency. There is also reduction in the risk of fraud and ensuring that investments are tailored to actual needs which eliminates waste of resources. According to the Interswitch’s statement, small to middle-sized businesses can access more funding in a shorter time (up to three weeks) from participating banks such as United Bank for Africa (UBA), Guaranty Trust

Bank Plc (GTBank) and Zenith Bank Plc while benefiting from increased sales cycles from participating corporations like Dangote Group. “In our 15 years of operation, we have experienced the bottlenecks associated with the existing corporatebased financing infrastructure in Nigeria,” Mitchell Elegbe, group managing director and chief executive officer Interswitch noted. “This is why we are happy to partner with Microsoft, by leveraging the advanced technology of the Microsoft Azure Blockchain, to prove the possibility of building a distributed ledger that is practical, viable and has the propensity to solve some of Nigeria’s most difficult financial and logistic problems.” Launched in May, 2018, the Microsoft Azure Blockchain integrates Microsoft Flow and Logic Apps – which offer hundreds of connectors to thousands of applications – to make the creation of blockchain apps easier. “Blockchain empowers the next step – enabling a single, authentic data set shared across counterparties,” Matt Kerner, general manager of Microsoft Azure said in an interview. “This is already improving the way transactions happen.” Transaction enquiries and verifications on the Interswitch Block platform are handled by authorised officials from participating entities, without the incentives of a cryptocurrency.

“This will be the first enterprise-grade blockchain service in Nigeria, and one of

only a handful of production blockchain applications in use by banks and corporate glob-

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

ally,” Michael Glaros, principal program manager, Microsoft said in a statement.

Thursday 15 November 2018

Luxury

Malls

Companies

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Spending Trends

Nigeria’s FMCG e-commerce sales to grow on internet penetration, market size …enabling regulatory environment needed Bunmi Bailey

igeria’s FMCG e-commerce sales has potential to grow exponentially due to growing internet penetration, large market size and population density. This is according to fast moving consumer goods (FMCG) E-commerce report by Nielsen Holdings Plc., which also stated that the rise of e-commerce is providing exciting growth opportunities for hundreds of thousands of companies in all shapes and sizes and has opened up a whole new shopping world. But despite the e-commerce boom, it currently contributes less than 7 percent of the global FMCG market, which is $4 trillion, according Nielsen Holdings, a global measurement and data analytics company. The report looked at how FMCG players in Nigeria and other countries’ governments and regulatory bodies can create a more enabling environment for e-commerce and help clients prioritise markets and make more informed decisions about their e-commerce investments through these key drivers. Market size Nigeria has the largest economy in Africa. For e-

commerce, market size matters. Large markets generally provide more opportunities and profit potential for e-commerce players. Bigger markets are also able to mobilise larger investments into e-commerce technology and innovation, which further accelerates ecommerce. For example, the U.S. and China, the world’s two largest economies, not only generate the most FMCG sales, but are also leading innovators. Bank account penetration Credit and debit cards, and mobile wallets (e.g., Alipay and PayPal) are the most popular ways to make online purchases, and they all require bank accounts. Bank accounts are essential and necessary ecommerce purchases. Markets that succeed at ecommerce tend to have very high levels of bank account penetration. But Nigeria still lags behind its peers in terms of bank account penetration. According to World Bank Fintech Database 2017, the number of bankable people declined in the last four years to 39.4 percent in 2017 from 44.2 percent in 2014 while SSA countries on average gained across the region as it increased to 42.6 percent in 2017 from 34.2 percent in 2014. For any FMCG company to increase its sales volume, at

least 94 percent of the population must have a bank account Internet penetration Internet penetration is an important driver for ecommerce success. To make an order or an online payment a user needs access to the internet. According to the report, Nigeria internet access doubled in the past five years, which has helped drive impressive growth for the country’s biggest online retailer Jumia, which posted an impressive 47 percent increase in sales in 2017 Smartphone penetration Smartphone penetration is a major driver to FMCG e-commerce success. This is especially apparent in many emerging markets where

smartphones are cheaper and more readily available than computers. For example, South Korea, smartphones are now used for more than half of all business-to-consumer online sales while in Canada, FMCG has emerged as the most frequently shopped categories from smartphones. Ease of doing business E-commerce growth can be achieved in a country where businesses are easy to do. The World Bank ranks South Korea as one of the top five nations with high consumer protection, ease in taxation and permits for businesses, and simplified trading across borders. Population density Countries with a high pop-

ulation density have significant e-commerce advantages through lower logistic and infrastructure costs. In countries with dense populations, deliveries can reach more people in a shorter time and requires less stores and depots. Postal reliability The vast majority of e-commerce sales utilise public and private postal services. The reliability of these services is an important contributor to ecommerce success. Customers need to be sure that their purchases will arrive when expected and in top condition. Singapore is a great example of postal reliability with its standardised addresses and efficient postal code system, which are complemented by densely populated areas and a good transport network Trust Consumer trust is crucial for e-commerce success. Trust includes many aspects. For example, shoppers need to be sure that they are purchasing genuine products, that deliveries will arrive safely on time and in good condition, and that the payment process is secure. Trust is a particularly important consideration in the FMCG online space, especially for fresh and frozen foods, where the quality of the product can easily be compromised. Saving culture Markets where the popula-

tion saves more tends to also spend more online. And notably, these sales are generally not cannibalising offline sales, indicating that consumers are comfortable dipping into their savings for additional purchases. Such consumers are generally value conscious and actively pursue good deals. For example, China has a high household savings rate, and consumers there are certainly enticed by the promise of cheaper prices, as reflected by the incredible success of Black Friday, the world’s biggest shopping day. Maturity of FMCG e-commerce retailers There is a clear relationship between mature ecommerce markets and high online FMCG sales. How well established ecommerce is in a market not only determines current success but is also a key driver of future growth. The length of time e-commerce players have operated, their geographical reach, brand assortment, prices and deals, delivery time and options are among the indicators of e-commerce maturity. Mature e-commerce markets can more easily ensure consumer loyalty, engage new online shoppers, and develop cutting edge services that make the online shopping experience more appealing.

International Remy Martin brand ambassador wows consumers with exclusive opulence experience Ifeoma Okeke

ast month, Florian Heriard Dubreuil, member of the House of Rémy Martin visited Lagos and Abuja, sharing bespoke Rémy Martin XO Opulence revealed experiences with select guests in the two cities. In 1981, to reinforce the quality strategy of the Rémy Martin House it was decided to create XO which would express the excellence of the cognac Fine Champagne. The Cellar Master André Giraud with his expertise crafted a blend of over 400 eaux-de-vie. On the nose, it offers a wide spectrum of aromas of late summer fruit combined with rich floral notes of white flowers such as jasmine. The perfect expression of cognac Fine

Champagne opulence on the palate with mature flavours of juicy plums, candied oranges, hint of hazelnuts and cinnamon. A velvety texture with a lingering finish. Opulence Revealed explores the different families of flavours present in this unique cognac. The experi-

ence is as visually arresting as it is flavourful; guests were treated to a beautiful table spread on which all the various elements were displayed – a veritable bouquet of flowers joined by decadent parmesan, candied ginger, artisanal chocolate, dried figs, honey, plums, hazel-

nuts, cinnamon and more. Guests were encouraged to sample these aromas as Florian Heriard Dubreuil guided them through a Rémy Martin XO tasting. “The concept of Opulence Revealed was created to bring the intricate flavour profiles of Rémy Martin XO to life in a tangible way and it was an honour to share this very special sensory experience with our guests”, shares Florian Heriard Dubreuil. Remy Martin XO has a strong story behind it. It was in 1981 that Cellar Master André Giraud crafted an XO that would bring out all the complexity and excellence of Cognac Fine Champagne. Produced up to 400 aged eaux-de-vie, the iconic Rémy Martin XO bears the inimitable signature of the House’s Cellar Master. It offers a rich aromatic palette:

touches of white blossom such as jasmine and iris, hints of candied fruits like plums, figs and oranges, and woody notes of cinnamon and freshly grated hazelnuts. Its flamboyant mahogany color is striking at first glance, while its exceptional velvety texture is revealed on the palate. It is a worthy homage to our never-ending quest for excellence. In 1981, to reinforce the quality strategy of the Rémy Martin House it was decided to create XO which would express the excellence of the cognac Fine Champagne. The Cellar Master André Giraud with his expertise crafted a blend of over 400 eaux-de-vie. On the nose, it offers a wide spectrum of aromas of late summer fruit combined with rich floral notes of white flowers such as jasmine. The perfect

expression of cognac Fine Champagne opulence on the palate with mature flavours of juicy plums, candied oranges, hint of hazelnuts and cinnamon. A velvety texture with a lingering finish. Founded in 1724, Maison Rémy Martin is the embodiment of Cognac Fine Champagne. The fruit of the prestigious regions of Grande and Petite Champagne, its cognacs hold outstanding ageing potential. The exclusive selection of grapes that make up the heart and soul of cognac, combined with the inimitable know-how of the cellar masters create a one-of-a-kind aromatic intensity. For over three hundred years, the House has pursued one ambition: to reveal the talents of nature and humankind through its quest to capture the very heart of Cognac.

Politics & Policy

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2019: PDP urges INEC to disqualify APC, prosecute Sanwo-0lu …PDP jittery of failure - APC Iniobong Iwok

he Lagos State chapter of the People’s Democratic Party (PDP) has urged the Independent National Electoral Commission (INEC) to disqualify the ruling All Progressives Congress (APC) from contesting the governorship election in Lagos State and also prosecute the party’s governorship candidate, Babajide Sanwo-Olu, for violating the election timetable on start of campaigns. It would be recalled that the Vice President, Yemi Osibanjo, Governor Akinwunmi Ambode, and the Lagos APC governorship candidate have recently been visiting markets in the state to distribute ten thousand

naira each to traders as support in a scheme known as trader-moni. But the PDP in a statement to the media and signed by its state Publicity Secretary, Taofeek Gani, said that the recent rallies in Lagos markets by the Vice President which equally introduce the APC governorship candidate to the traders for votes was intended for campaigns and not to launch any trader support programme or trader-moni. The statement further said that Sanwo-Olu was often introduced as the governorship candidate of the APC in such visitation to the traders, stressing that the visitation are often accompanied with APC campaign posters, souvenirs, musicians promoting APC and its governorship candidate.

Presidential candidate of the Peoples Democratic Party (PDP) and former Vice President of Nigeria, Atiku Abubakar exchanging greetings with Professor Ben Nwabueze, while the national chairman of the PDP, Prince Uche Secondus looks on during Atiku’s consultative meeting with leaders and stakeholders in the South-East on Wednesday in Enugu.

The PDP claimed that the markets’ visitation was an electoral impunity which INEC cannot deny knowledge of, adding that the trend gives unfair advantage to the APC ahead of next year’s general election. The statement further berated the commission for refusal to sanction the APC in the state who have in recent time also been using the state media to engage in campaign, stressing that position of INEC was indication that the commission was not ready to conduct next year’s elections. “The deliberate rallies into Lagos markets by the vice president, is basically to introduce the APC governorship candidate to the traders for votes and not intended to launch any trade support programme. “Sanwo-Olu at every of the visitations is introduced as governorship candidate of APC and the vice president always seeks the traders to vote APC to continue the ‘trader-moni’. Similarly, the visitations are fleshed up with APC campaign posters, souvenirs, musicians to promote APC and Sanwo-Olu. “The Lagos APC and governorship candidate have been using the state media houses to lure voters. We shall not standby to be technically rigged out of this election, we take very strong objections to these illegal and foul campaigns by the APC governorship candidate,” the party said. According to the PDP, “We state categorically that the INEC is officially abetting this electoral impunity by looking the other way pretending not to notice the APC violations.

How I would recue Nigerians from poverty - Ezekwesili Iniobong Iwok

he Presidential Candidate of the Allied Congress Party of Nigeria (ACPN), Obiageli Ezekwesili, has said that her administration would focus on investing in human capital development and give priority to education as a means to checking the rising poverty among Nigerians if voted into power after the 2019 general election. Ezekwesili, who was a former Minister of education and solid minerals, stated this while presenting her manifestos to the media in Lagos, saying that the country would not win the war on poverty without investing in human capital development. She identified seven ‘monstrous’ challenges facing the country and proffered solution to them, stressing

that the county would not progress without a holistic plan and strong visionary leadership. “If I’m elected President of Nigeria, education and skill development of healthy Nigerian people shall be our number one priority,” Ezekwesili said. According to her, “No matter what we do, we would never win the war on poverty without investing massively in human capital development. Education would be the new oil; my vision for education is that it would flourish and create a progressive society. “Extreme poverty in Nigeria is increasing by nearly 6 people every minute. In the time it will take me to deliver my speech today, about 250 Nigerians would have become extremely poor. Think about that for a second. But that is not even the worst part. “According to the World Poverty

Clock, if the current trends continue - or to put it another way, if we continue to elect this poverty- bringing APC/PDP leadership, the number of people living in extreme poverty in Nigeria would increase from about 88 million today to 120 million in 2030. “That means that in the next 12 years, over 30 million more Nigerians will join the infamous number of extremely poor people who live on less than N700 per day.” According to her, “When a country has a GINI coefficient above 35percent, it means the income inequality in that country is very high. Nigeria’s GINI coefficient is between 46 and 60 percent. Such levels of extreme inequality have all sorts of destabilising implications for the country. Tackling the inequality and lifting 80 million Nigerians out of poverty will be the mission of my presidency.

Thursday 15 November 2018

‘Atiku Presidential Campaign Organisation offers APC free crash course on how to run an issue-based campaign’

he Atiku Presidential Campaign Organisation (APCO) has said that its attention was brought to a statement by the All Progressives Congress accusing the Presidential Candidate of the People’s Democratic Party of attempting to smuggle in large sums of money into the nation for the purpose of funding his campaign. APCO said that the APC had in a statement allegedly called for security agents to be on the watch to prevent the imaginary ‘illicit cash’ from entering Nigeria. According to the campaign organisation, “We are surprised that the same APC which made that false allegation has made a 180-degree turn by releasing a new statement contradicting their earlier statement and alleging that the former Vice President is broke. “In their statement, they contend that ‘Atiku Abubakar is at a crossroads on how to source funds for the 2019 electioneering campaign.’ Our response is to urge the APC to make up its mind on which lie it wants to tell the Nigerian people and then stick to that lie. As a party in power, there ought to be more stability in the APC at least to give the public and the international community some assurance that the party is not imploding. No wonder there is a

lot of policy flip flop under the APC administration.” Accusing the APC of desperation, APCO said: “We know that the APC is desperate to distract attention from the recent indictment of Vice President Osinbajo by the House of Representatives for grand corruption and the interrogation of their chairman, Adams Oshiomhole, by the Department of State Security on charges of collecting huge bribes to influence party primaries. “Given the sordid state of things in the APC and its imminent implosion over money politics, we are not surprised that the APC is throwing wild allegations at former Vice President, Atiku Abubakar, in the hope that something will stick.” According to the campaign group, “Our advice to the APC is that they should send their spokesman to the Atiku Presidential Campaign Organisation for a two-week crash course on how to run an issuebased campaign that is guided by civility and refined language. “While the APC is throwing about baseless accusations, our candidate, Atiku Abubakar, is set to launch tangible policies that will get Nigeria working again. Our campaign is focused on addressing the concerns and the welfare of Nigerians by Atikulating plans to move Nigerians out of poverty.”

I will not hand over to illegal PDP executives in Kwara – Oyedepo SIKIRAT SHEHU, Ilorin

kogun Iyiola Oyedepo, former People’s Democratic Party (PDP), in Kwara State, on Wednesday said he will not handover the party’s property to illegal executive members as presently constituted in the state. Oyedepo, who made this known in Ilorin while briefing journalists, said having received several calls from his former youth leader, Mahmud Dansofo, that he was instructed by the Chairman (Kola Shittu), to hand over party’s property to the new executive, insisted that the PDP executive led by Kola Shittu was illegal. “I know that there should be the need for proper handing over of the party’s property to those that must take over. But there is need to hand over to lawfully and properly constitute executive of the party. “It is my considered opinion that Kwara State executive of PDP as presently constituted is illegal and cannot be the proper people to whom the property of the party can be entrusted,” Oyedepo clarified. Speaking further, he explained, “It is a well known fact that as from the 1st day of August 2018, I ceased to be the chairman of PDP in Kwara State.

“And since then I have waited in vain that the party, PDP will put its house in proper shape to elect a new executive of the Party in accordance with its well-known provisions of its constitution. “As far as I am concerned, the Kola Shittu-led executive is illegal and not properly constituted in accordance with the extant laws of PDP. Nobody in that Executive can come forward to claim the properties of the Party from me.” Oyedepo noted that when he left PDP, there were still some members of the executive that did not leave him, saying that it was the constitution of PDP that when a member of the executive resigned or removed, he should be replaced from his locality. Oyedepo also resolved that there are still members of the PDP executive in the state that has not been dissolved by the National Executive of the party have. “I left many other members of the executive that neither resigned nor the executive members under me dissolved by the National Executive of PDP. Something must be done to make the executive legal after my departure. “If that is not done whatever structure is put in place by the PDP in Kwara State is illegal and I cannot do any political business with an illegal body,” he added.

BUSINESS DAY

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NEWS YOU CAN TRUST I THURSDAY 15 NOVEMBER 2018

Opinion Presenting Nigerians with a fait accompli CHRISTOPHER AKOR Chris Akor, a First Class graduate of Political Science, holds an MSc in African Studies from the University of Oxford and is BusinessDay’s Op-Ed Editor christopher.akor@businessdayonline.com

e rhap s o n e o f t h e enduring contributions and relevance of Chidi O dinkalu and Ayisha Osir i’s book “Too Good to Die: Third Term and the Myth of the Indispensable Man in Africa” is the attempt to explain the phenomenon of the military god-complex in Nigeria, where soldiers have hijacked politics and g overnance in Nig er ia since 1966 and continue to dominate the political terrain whether in and out of uniform, usually exploiting Nigeria’s fault-lines and promising to fight corruption. They did this by promoting a false narrative of “the structural fragility of state(s) which are ‘ethnically and religiously heterogeneous,’ and that “they alone have the capability to keep these states

THE PUBLIC SPHERE

CHIDO NWAKANMA Nwakanma is a Visiting Member of the BusinessDay Editorial Board and serves on the Adjunct Faculty at the School of Media and Communication, Pan Atlantic University, Lagos. Email chidonwakanma@gmail.com.

he dominant ideological battle between the media and power in America entered the second level Tuesday, November 13, 2018. CNN sued the American President over denial of access to the White House for its Senior Correspondent Mr Jim Acosta because the revocation of the credentials violates the constitutional right of freedom of the press. “The administration stripped Acosta of his pass to enter the White House following President Donald Trump’s contentious news conference last week, where Acosta refused to give up a microphone when the president said he did not want to hear anything more from him”, AP reports. “White House Press Secretary Sarah Sanders said: “this is just more grandstanding from CNN, and we will vigorously defend against his lawsuit.” “Trump has made CNN and its reporters a particular target of his denunciation of “fake news” and characterisation of the media as an enemy of the people. CNN CEO Jeff Zucker, in a letter to White House chief of staff John Kelly, called it a

together while simultaneously demonising civilian politicians as a venal and corrupt class from whose predations the military exerts itself to save the people.” Well, military rule became anachronistic in the late 1990s and the military had to beat a retreat to the barracks in 1999. But the military god-complex had continued to hold sway i n Nig e r i a. Th e y have m o nopolised the political space, of course, with a handful of private businessmen and politicians and have continued “to sponsor political actors and pre-deter mine contests for power” through subterfuge, sham elections or both. This group has decided who governs this country from 1999 till date and are set or have already determined who will emerge president in 2019. Former President Obasanjo – the dean of the ex-generals and their unofficial spokesperson – was the first beneficiary of this military god-complex in 1999. Although, he sought to violate the predetermined order of passing the presidential pie amongst themselves every four or eight years; and although the members of this group could quarrel and fight amongst themselves in contestation for the presidential pie, their dominance of the political space and influence

is yet to diminish. They have continued to set the electoral agenda and continue to deter-

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I’m equally worried that the ex-generals have never made a good choice for Nigeria. I’m worried that the horsetrading and negotiations that went into the adoption of Atiku as the preferred choice of the ex-generals will greatly constrain the former vice president and limit his ability to do what is right for the country

mine who emerges as Nigeria’s president in ever y election since. Of course, to do this effectively, they co-opt some politicians and businessmen to give it a political or democratic outlook. Take, for instance, the way this group booted out former president Goodluck Jonathan from power and installed General Buhari. It started with voluble leader of the group

accusing the Jonathan of incompetence and pursuing an ethnic agenda. He also led the way in the adoption of General Buhari, a perennial presidential aspirant as the man to deliver the country. Pronto, all the retired generals and their civilian lackeys or associates dumped the former president and lined up behind the Buhari project. What followed was one of the best image laundering and public relations work ever to be done on a candidate for election. In a jiffy, the generally held perception (created by the same set of people) of General Buhari as an ethnic champion, religious bigot, and perpetual unelectability was demolished. Before long, he became Nigeria’s messiah with a magic wand to, at once, end corruption and insecurity in Nigeria and bring about an age of economic and social development never experienced in the country before. Nearly four years down the line, the same set of people are tired of Buhari and have anointed another candidate – Atiku Abubakar - to take his place. Like Buhari, Abubakar ha s a p e rc e p t i o n p ro b l e m, still created by a section of this group, of being a corrupt individual with an inordinate desire for power. Just like they did for Buhari, they have began the process of refurbishing

Atiku’s image and presenting him to Nigerians as the best candidate to rescue the nation’s battered economy. Just like in 2014, they have set the agenda for 2019 and everyone seems to be following their lead without question. Don’t get me wrong. I felt in 2014 and still feel Buhari was never qualified and should never have been the president of Nigeria. I felt and still feel he isn’t intellectually, morally and physically fit to govern a diverse and complex country like Nigeria. I feel another four years of Buhari will spell catastrophic disaster for the country and may eventually lead to the disintegration of the country (a situation I believe the military godcomplex will not countenance for selfish reasons). I felt and still feel Atiku Abubakar, despite his perception problem, could have made a good choice of president in 2007 or even 2015 and would have helped deepened Nigeria’s political culture and development. I felt and still feel Nigeria’s problem isn’t corruption and corruption is only a symptom of a deeper problem – the weakness or absence of institutions, and a candidate that will help in the building of strong institutions will be the better choice for the country. But I’m equally worried that the ex-generals have never made a good choice for Nigeria.

I’m worried that the horsetrading and negotiations that went into the adoption of Atiku as the preferred choice of the ex-generals will greatly constrain the former vice president and limit his ability to do what is right for the country. I’m worried that the proclivity of the military god-complex for constitutional vandalism hasn’t waned and that their helping a candidate to office will mean a continuation of the destructive influence and power of this group. I’m also worried that the military god-complex has refused to even countenance the candidacy of more qualified aspirants and have continued to rely on the politicians and military officers of old that are part of the problem of this country. These devious fellows have always deter mine d the options for Nigerians and have made it difficult for the people to exercise real choice in the important matter of choosing the people to govern them. In a free society, the electorate decides everything; in dictatorships, it is those who count the votes; but in banana republics like Nigeria, it is neither of those, but a shadowy group of ex-generals who determine everything and only present the people with a fait accompli! It is not for nothing that Obasanjo referred to Atiku as Nigeria’s next president.

The war of press versus power in America “pattern of targeted harassment.” “The White House initially contended it was Acosta’s refusal to give up the microphone that led to his banishment; CNN said it’s apparent the president didn’t like his questions.“Mr. Acosta’s press credentials must be restored so that all members of the press know they will remain free to ask tough questions, challenge government officials and report the business of the nation to the American people,” said Theodore Olson, former U.S. solicitor general and one of CNN’s lawyers on the case. The White House Correspondents’ Association backed the lawsuit, filed in Washington, D.C., district court.“The president of the United States should not be in the business of arbitrarily picking the men and women who cover him,” said Olivier Knox, president of the correspondents’ group. “CNN asked for an injunction to immediately reinstate Acosta, as well as a hearing on the larger issue of barring a reporter. To prove the administration’s case last week, White House press secretary Sarah Sanders distributed via Twitter a doctored video sped up to make Acosta’s physical actions toward the intern seem more threatening.” As we noted in a 2017 essay, the ideological war hacks back to halcyon days. The Age of Enlightenment seemed to have declared it for one party. In the ring are Donald Trump and the mainstream media of America. Resolution of the war could lead to a reiteration of the roles of the press or modifications of existing theories, notably the social responsibility theory. Donald Trump brings to the battle the full armoury of the Office of President of the United States, his popularity with American vot-

ers and the backing of the White Anglo-Saxon Pentecostal Church. The White Church claims God sent Donald Trump for these times. There are many Nigerian supporters of Donald Trump who hate the American media, notably CNN, in defence of Trump. Donald Trump fought long odds to become President of the USA. On the other side are the major media organs of America. They include The New York Times, CNN, and The Washington Post. Other forces on the press portion of the battle include The Huffington Post, NBC News, Time, Esquire, New Yorker and various local titles. Across the ocean, other media are providing supporting firepower. They include The Guardian and the venerable BBC. On their part, the media have a long history of fighting battles for relevance with authority figures and are now well entrenched to fight the ideological battle. Twitter maven Trump only on Friday, February 17, 2017 declared the media “the enemy of the American people.” He stated: Donald J. Trump @realDonaldTrump The FAKE NEWS media (failing @nytimes, @NBCNews, @ABC, @CBS, @CNN) is not my enemy; it is the enemy of the American People!” Earlier, his then chief strategist Steve Bannon had called the media the “opposition party”. On the surface, the war is a fall out of the last US election. In the run-up to the US General Elections that Trump won, most of the media endorsed his opponent, Hilary Clinton. The media, as well as pollsters, projected a win for Clinton. Eventually, Trump won the Electoral College but lost the popular vote to Clinton.

Through it all and particularly on assuming office, Donald Trump has sought to delegitimise the American media by branding them as bearers of fake news. It is a battle for control of minds and hacks back to the days of Emperor Kings or to Africa where rulers insist that they only have the final say on matters. Donald Trump has come with a desire to upturn many things in America. The role of the American press is one of his primary targets. He does not want a press that probes, questions and continuously targets power holders, making them accountable in words and deeds to the citizens. Centuries of practice have seen the American press established as defenders of democracy. Indeed, a former American President Thomas Jefferson underlined the importance of the media to American democracy. During his time as U.S. minister to France,

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Donald Trump has come with a desire to upturn many things in America. The role of the American press is one of his primary targets. He does not want a press that probes, questions and continuously targets power holders, making them accountable in words and deeds to the citizens

Thomas Jefferson penned a letter to a statesman from Virginia, waxing poetic about the importance of a free press. “The basis of our governments being the opinion of the people, the very first object should be to keep that right,” Jefferson wrote to Edward Carrington in 1787. “And were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter. ButI should mean that every man should receive those papers and be capable of reading them”. The relationship between the media and power has of necessity been adversarial. Professor Fred Omu captured this well in Press and Politics in Nigeria: 1859-1935, his history of the early Nigerian press. It tells of the struggles of the pioneers with the colonial administrators. Section 2, subsection 2 of the 1999 Nigerian constitution similarly establishes a basis for an adversarial relationship when it charges the media to uphold the Fundamental Objectives and Directive Principles of State Policy of Nigeria and hold the government accountable to the people. Many governments do not like the media on account of its role in holding government accountable. Governments with an agenda that runs against the currents are particularly prickly about the media. In the case of Trump, the man who deployed the media to run a campaign against a sitting President for years now considers those same vehicles for his projection as bearers of fake news. It was not fake news when the media reported his birther campaign against Barack Obama. Trump is acting like disgraced former President Richard Nixon

who also saw the press as enemies. He told Henry Kissinger in 1972, “The press is the enemy, the establishment is the enemy, the professors are the enemy.” The American media has operated with the philosophical underpinning of the social responsibility theory of the press, itself an outcrop of the Hutchins Commission Report of 1947 that affirmed the significant role of the media in modern society and the need for it to exercise its enormous powers with a responsibility to society. Robert Hutchins and his 12 wise men took four years to write their report. Time magazine publisher Henry Luce commissioned the effort at a time when the media was subject to much criticism. Big and powerful publishers were unpopular with the public, while the public suspected the motivations and objectives of the press. The situation today recalls that era. Trump has many supporters who see the news media today as evil, unfair or unbalanced in their coverage. CNN, with its global reach and its pitched battle with Trump, represents for many a symbol of what is wrong with the media. Longer term, the media would depend above all on its fundamentals in this long war. Those fundamentals are the practice of verification and the canons encapsulated in the four pillars of the Code of Sigma Delta Chi, the Society of Professional Journalists. Those enjoin journalists to Seek truth and report it; Minimise harm; Act independently and Be accountable. Across the world, journalism ethics deal with the principal concerns at the heart of the profession. These are truth, accuracy, fairness, transparency, proper representation, attribution and the right of reply.

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