BusinessDay 15 Oct 2019 by BusinessDay

CBN contradicts self on Diaspora remittance DIPO OLADEHINDE & MICHAEL ANI

he Central Bank of Nigeria’s statement that Nigeria’s Diaspora remittance stood at $2.6 billion is contradicting official CBN data which show the actual Diaspora

remittance stood at $24 billion as at 2018, a fact check by BusinessDay has revealed. THE CLAIM Isaac Okorafor, CBN director, Corporate Communications Department, in a chat with a media firm at the weekend, said the

FACT CHECK total inflow from Nigerians living abroad is $2.6 billion and not $26 billion, as being quoted in some quarters. According to him, the data,

purported to be from the World Bank, had also been queried by the Monetary Policy Committee (MPC) of the CBN, as it did not reflect the actual amount of inflows from Nigerians living abroad. “Now, when the World Bank sums up the dollar value of inflows

from Nigerians living abroad, they say we receive remittances of $26 billion. I’m disappointed that enlightened people could now say remittances is $26 billion, giving an impression as if CBN has it in

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news you can trust I * * TUESDAY 15 OCTOBER 2019 I vol. 19, no 414

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Reps urge NNPC to plug loopholes in its revenue profile

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2020 budget: FG under pressure to meet revenue target, says Ahmed he Federal Government is under pressure to meet the revenue target of N10.33 trillion proposed in the 2020 budget, Zainab Ahmed, minister of finance, budget and national planning, said in Abuja on Monday. Ahmed, who spoke at the breakdown of the 2020 executive budget proposal, admitted that government is under pressure to rev up revenues and ensure that revenue targets are met to fund development. “Nigeria must mobilise significant resources to invest in human capital development and critical infrastructure,” Ahmed said. “Given the low revenue to GDP ratio (currently at about 7 percent), we must pursue optimal

fgn bonds

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South-East economy slumbers as governors fail to trigger prosperity ODINAKA ANUDU

outh-East governors are failing their people and shifting blame to the centre. They are averse to economic integration, can’t attract investors and watch while infrastructures within their domain decay. The South-East has the highest number of abandoned projects, with state projects featuring prominently, a 2019 survey

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Inside FG, labour in make-ormar dialogue as strike P. 2 looms L-R: Girish Sharma, CEO, Colgate Tolaram LFTZ Enterprises; Abimbola Fashola, former first lady, Lagos State; Kanye Tagbo-Okeke, social bravery winner; Yayah Zaki, physical bravery winner; Anthony Lawrence, intellectual bravery winner, and Pawan Sharma, chief operating officer, Tolaram Group West Africa, at the 2019 Indomie Independence Day Awards celebration in Lagos, at the weekend. Pic by Olawale Amoo

Tuesday 15 October 2019

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news Lessons from Kaduna for other Nigerian states on mortgages, land titling

…state provides free land for housing projects …processes land titles promptly to attract private investors CHUKA UROKO

Vice President, Professor Yemi Osinbajo presenting Certificate of Performance discharging Transcorp plc of post privatisation performance obligations in respect of Transcorp Hilton Hotel, Abuja to the chairman, Transcorp Plc (Owners of Transcorp Hilton Hotel, Abuja), Tony Elumelu, while the Minister of Finance, Budget and National Planning, Hajia Zainab Ahmed (m) watched, during a meeting of National Council on Privatisation chaired by the Vice President at the Presidential Villa, Abuja.

FG, labour in make-or-mar dialogue as strike looms JOSHUA BASSEY & INNOCENT ODOH, Abuja

n what appears to be the last efforts to avert a looming industrial action over the N30,000 minimum wage, the Federal Government and the labour unions will today, October 15, meet once again to resolve some of the lingering issues concerning the consequential adjustment in the minimum wage. The Ministry of Labour and Employment in a statement on Monday said the meeting of the Joint National Public Service Negotiating Council (JNPSNC) and labour is scheduled for 1.30pm today in the minister’s conference room. Chris Ngige, minister of labour and employment, had on Monday met separately with the Organised Labour team and the government

side of the JNPSNC in an effort to resolve the trade dispute. A statement issued on Monday by Charles Akpan, deputy director of press and public relations of the ministry, said that while the meeting with the labour team of the JNPSNC started by 12pm and ended 2.45pm, the minister sat in conciliation with the government side of the council between 3pm to 6pm. Negotiations have broken down several times as the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC) after receiving briefing from the JNPSNC issued a statement recently warning that if the issues of the consequential adjustment were not addressed by Wednesday, October 16, the labour movement would have no other alternative than to call its members nationwide

to embark on a total strike. Although grade levels 1-6 according to the government have started receiving their salary increase of N30,000 minimum wage from N18,000 since the new minimum wage was signed into law by President Muhammadu Buhari on April 18, labour is demanding a 29 percent adjustment on the salary of grade level 7-14. It also demands for salary increase of 24 percent for grade level 15-17, while the government is offering 11 percent for the level 7-14 and 6.5 percent for level 15-17. According to the statement, Monday’s meetings were collective bargaining negotiations, affording both parties the opportunity to share vital information, especially critical statistics to allay the fears as well as undo all encumbrances constraining

the attainment of a common position. “Deliberations were intended to smoothen the rough edges in preparation for a fruitful high level conclusive meeting scheduled for tomorrow, Tuesday, 15th October, 2019. Both sides were satisfied with the briefings they received from the minister and promised to get back to their constituencies for further inputs,” the statement said. Representing the Organised Labour were the deputy chairman of the NLC, Comrade Amaechi Asugwuni; NLC general secretary, Comrade Emma Ugboaja; Musa Lawal Ozigi of the TUC, Nuhu Toro (TUC) Lawal Alade Bashir as well as Comrade Musa Abbas.

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Nigeria’s informal FMCG market thrives on women entrepreneurial energy

…but lack of access to credit, logistics impair expansion STEPHEN ONYEKWELU

omen entrepreneurs in the Fast Mov i n g C o n sumer G oods (FMCG) value chain are surmounting the tough business environment in Nigeria and creating enterprises where women are making profitable business decisions. With the support of Women Entrepreneurs Finance Initiative (We-Fi), in partnership with the International Finance Corporation (IFC) and Daraju Industries Limited, a dynamic case study has been launched that shows how women entrepreneurs are riding on opportunities in Nigeria’s fast-moving consumer goods space. But women entrepreneurs are still barely scratching the surface of opportunities in the FMCG sector due to limited access to credit and logistics, the case study showed. The FMCG sector is critical because it is the third-

largest contributor to the Nigerian economy, estimated at 16 percent of gross domestic product (GDP). The sector depends on micro, small, and medium-sized enterprises (MSMEs), which constitute more than 96 percent of all businesses in Nigeria. Thirteen percent of these informal businesses are owned and run by women. Women own and lead roughly 6.6 million formal SMEs and 39 million micro-businesses in emerging markets. The case study surveyed 250 male and female distributors on factors affecting sales performance, which included access to finance, logistics, technology and networks. Overall, distributors identified six business bottlenecks as the main barriers to their growth. In addition to the ones listed already, manpower and business management skills have been critical. Female distributors who participated in the survey www.businessday.ng

had on average fewer years in operation, less experience as a distributor, and fewer employees than male counterparts. They are older, more educated, have fewer family dependents, and spend more time on their businesses. But sales revenue for female distributors is on par with male counterparts and even higher in some regions. “Female distributors that accessed credit in 2017 in the FMCG space had 20 percent higher sales and 26 percent higher in 2018,” said Heather Kipnis, lead, Women’s Entrepreneurship at IFC. “Women distributors cited lack of access to finance and logistics (particularly access to vehicles and storage) more than men in the survey,” Kipnis said at the launch of the case study. With access to their own vehicles, distributors gain flexibility in both picking up inventory and dropping off goods to customers in remote,

rural, and hard-to-reach markets. Similarly, with access to storage facilities, distributors can hold more inventories in stock and in closer proximity to consumers. But social and cultural legacies still exclude women, who constitute over 50 percent of the market in Africa. “Strong unequal distribution of assets among men and women still skews and deprives women of playing critical roles in Nigeria’s social and economic spheres. There are many female entrepreneurs in Africa partly because women have fewer options. In Nigeria’s mostly informal economy, women thrive and open up new markets,” Eme Essien, Nigeria country manager at IFC, said. “The IFC has mapped out over $1 billion as part of a global agenda to improve access to finance for women entrepreneurs.”

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he intervention and determination by the Kaduna State government to address its housing deficit and enable ordinary people in the state to access decent housing has placed it ahead of other states of the federation in the area of housing. The state holds out lessons for other states and the Federal Capital Territory (FCT) with its giant strides in creating mortgages and making property registration easy for buyers. The state has strengthened its mortgage system by passing the Mortgage and Foreclosure Law and followed it up with the creation of the Kaduna State Mortgage and Foreclosure Authority. “This makes Kaduna the first state in Nigeria to create a mechanism to facilitate resolution of default issues in this important sector,” said Nasir El Rufai, the state governor, who spoke at a real estate forum in Lagos recently. The governor explained that by Executive Order in June 2019, the state established the Ministry of Housing and Urban Development to drive its vision for expanding the housing stock in the state. The state is digitising land documentation and titling and, according to the governor, the Kaduna Geographic Information Service (KAD-

GIS) is processing land titles promptly to attract private investors in the housing sector. Kaduna is nearly 5 percent of Nigeria’s population but accounts for up to 1 million units of the country’s 17 million housing units deficit. This gap exists mainly at the lower end of the market, which is not particularly attractive to the private sector. This is why, as a government, the state is confronting housing delivery frontally. It is doing its best to widen and broaden the mortgage system that it has created to support the sale of government houses. This initiative is aimed to enable Kaduna citizens to buy houses and pay over 15-20 years, paying at single-digit interest rates. Recently, Kaduna partnered with Sterling Bank to provide single-interest mortgages in the state. It has also signed an MoU with Nigerian Mortgage Refinance Company (NMRC) and the FHA Mortgage Bank to jointly commit N3 billion to providing affordable mortgages. As part of a framework to support investors and buyers in the real estate sector, El Rufai said the state was providing free land for housing projects in the state and also addressing the demand side of housing by expanding access to mortgage.

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FG lists N15bn green bond on NSE

he Federal Government on Monday listed its N15 billion green bond on the daily official list of the Nigerian Stock Exchange (NSE). The seven-year bond issued at coupon rate of 14.50 percent on June 13, 2019 would mature on June 13, 2026. The Series II Green Bond was issued to finance renewable energy, afforestation, and transportation projects, according to the News Agency of Nigeria (NAN). The series 11 bond followed the debut Sovereign N10.69 billion Green Bond that was issued in December 2017 and listed on the NSE in July 2018. Commenting on the listing, Jude Chiemeka, NSE head, Trading Business Division, said that the exchange was pleased to admit the bond. “We are pleased to admit the Series II FGN Green Bond to our Green and Sustainable Bond Market. “Our collaboration with the Ministry of Environment (MOE) and the Debt Management Office on deepen@Businessdayng

ing the Green Bond market, which dates back to 2016, reinforces the Exchange’s commitment to position Nigeria as a financial centre for green and sustainable financing,” Chiemeka said. He noted that the recent partnership with the Luxembourg Stock Exchange (LuxSE) further demonstrates NSE’s passion to provide enabling environment for issuers and investors in the Nigerian capital market. “The Exchange will continue to work with key stakeholders in transitioning to a low-carbon and sustainable economy as well as develop innovative products and services in close collaboration with the market,” he added. Chiemeka also congratulated the Minister of Environment and the Management of the DMO on the successful issuance of a second Green Bond. He said that the laudable feat would aid in addressing environmental challenges and fostering sustainable financing in Nigeria.

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Rice smuggling: Court orders interim Rain or no rain, we’ll fix Ogun roads, governor assures freezing of 45 accounts of three banks Razaq Ayinla

otwithstanding the challenges of perennial rainfall and attendant flooding in most part of Ogun State, the state government says it would stop at nothing to fix the intra and inter-city roads under it. “We are even going beyond State and township roads, we have taken it upon ourselves to fix federal roads that run through the State,” a statement by Kunle Somorin, the chief press secretary to Governor Dapo Abiodun, said. The statement said the State Governor has issued firm directive to the Public Works Agency

(OGPWA) handling the palliative and reconstruction works across the State to step up its games and that he would not brook any excuses about rain. “Consultant to the State Governor on Works and Infrastructure, Engineer Ade Akinsanya, told me that the Governor is mounting pressure on the leadership of OGPWA to ensure that our people have roads to go about their business as a matter of right. Indeed, he challenged us to reverse the public infrastructure deficits in the State within the next few months – rain or no rain,” the statement added.

Felix Omohomhion, Abuja

Federal High Court in Abuja on Monday ordered the Central Bank of Nigerian (CBN) to temporary freeze 45 bank accounts linked to three companies alleged to be involved in rice smuggling into the country. I n a n e x- p a r t e m o tion, with No: FHC/ABJ/ C5/958/2019, CBN had asked the court to freeze the accounts of the companies involved in the alleged smuggling of rice into Nigeria.

‘Nobody attacked Oshiomhole’ – Edo CP restates

The companies whose accounts are domiciled with 10 commercial banks in Nigeria are Sun Sam A1 International Limited, Sun Sam International Limited and Sunchrist O. Trans Nigeria Limited. Justice Ahmed Mohammed, who gave the order, directed the head offices of First Bank Nigeria, Stanbic IBTC Bank, Union Bank, Un i t e d Ba n k f o r A f r i ca (UBA), Zenith Bank, Sterling Bank, Access Bank, First City Monument Bank (FCMB), Polaris Bank, and Eco Bank Nigeria to freeze forthwith for 45 days all transactions

on the accounts pending the outcome of the investigation and inquiry currently being conducted by the CBN. In arguing the ex parte application on behalf of the apex bank, its counsel, Nosike Nicholas, asked the court to freeze the accounts for 90 days. However, Justice Mohammed granted the apex bank permission to freeze the accounts for only 45 days. He said that the order of freezing for 45 days was subject to renewal for further days upon an application by the CBN, in the event that its

investigation could not be concluded within the first 45 days. Nosike who anchored the application on section 60, Paragraph (B) of the Banks and other Financial Institutions Act (BOFIA) 1991 as amended told the court that “there is an ongoing investigation against the defendants who are customers of the commercial banks, adding that the transactions under the accounts can cause significant financial loss to the rice industries I particular and the Nigeria economy in general”.

... as Edo APC chieftains caution against heating up the polity

he Edo State commissioner of police, DanMallam Muhammed, has restated the State Police Command’s position that there was no attack on the person or residence of former governor of the state and national chairman of the All Progressives Congress (APC), Adams Oshiomhole. Muhammed, who said this in an interview with journalists on Monday, debunked allegations of an attack on the former governor, warning troublemakers to steer clear of the statem saying the Police beefed up security around the APC national chairman while his visit to the state lasted, during which no attack was recorded. “To the best of my knowledge, no one had access to the house of the national chairman. When he came into the state, we beefed up security around him, from his house to the Oba’s palace, from there to the airport before he left for Abuja. “Let me use this medium to warn trouble makers that Edo State is very peaceful and calm. The state is the most peaceful in the South-South region of Nigeria. We will do everything according to the law to ensure that the peace the people of Edo State enjoy is not truncated and any attempt

by anyone to cause trouble in the state will be resisted with maximum force,” he said. A chieftain of the APC in the state, Charles Idahosa, described the allegations as efforts by unscrupulous elements to heat up the polity so that evil elements could have their way. According to Idahosa, “The State Commissioner of Police has come out to state categorically that there was no such attack on Oshiomhole. The state government has also denied knowledge of such an attack. But these people keep insisting that the former governor was attacked. They have brought in other actors to corroborate what never happened. That is the height of spreading fake news. “It is obvious that they are concocting these attacks to get public sympathy. They should quit the charade. We want to warn them not to heat up the polity. The Edo State Government is led by a man who puts a premium on law and order, as can be seen in Governor Godwin Obaseki’s numerous reforms as well as other public engagements.” Another chieftain, Peter Ologun, said it was regrettable that a national chairman of the ruling party would resort to spreading fake news to draw sympathy to himself.

Jumia charges government to leverage tech to manage huge population for productive economy Daniel Obi

EO of Jumia Nigeria, Juliet Anammah, has identified access to quality education as a key to managing huge population for productive economy. According to Anammah in a statement, there is a need for policies that support micro industries in order to tackle unemployment. “Providing unemployed youths with internet-enabled smartphones is one of the infrastructure that could take millions out of unemployment,’’ she said. Anammah made this disclosure while speaking as a panel member at the 25th Nigerian Economic Summit in Abuja, which dissected the topic on demography: “Nigeria in 2050: boom or bust,” alongside the founder of the Kukah Centre,

Bishop Mathew Kukah; Governor of Ekiti State, Kayode Fayemi, and Emir Sanusi, who said Nigeria’s huge population was yet to be converted into productive use. “We need policies that support micro industries. We have millions of people underemployed today. How do we tackle it,” she asked. Providing unemployed youths with enabled internet smartphones is one infrastructure that can take millions out of unemployment, she said. The Emir of Kano said Nigeria’s attributed the negative vices ravaging the country on huge, uneducated population. The focus of the panel session was on how Nigeria’s demographic realities can be transformed into social and business opportunities. www.businessday.ng

L-R: Ikechukwu Nnamani, president, Medallion Communications Limited; Akin Naphtal, CEO, Instinct Wave; Oluseyi Olanrewaju, finance director, Vodacom Business Nigeria, and Fejiro Adaka, finance manager, treasury, Vodacom Business Nigeria, at the 5th Nigeria Finance Innovation Award held in Lagos, where the company won CFO of the year and Finance team of the year awards.

SMDF partners OCP Africa to explore, develop Nigeria’s phosphate reserves GBEMI FAMINU

h e S o l i d Mi n e r a l s Development Fund (SMDF) and OCP Africa Fertilizers Nigeria Limited (OCP), a subsidiary of OCP Group, have signed a technical cooperation agreement relating to the exploration and development of Nigeria’s phosphate deposits in Sokoto Basin, in Casablanca, Morocco. This agreement will ensure technical cooperation between SMDF and OCP Africa in the fields of phosphates exploration a n d a p p ra i s a l ; s u p p o r t SMDF effor t to develop p h o s p hat e m i n i ng, a n d provide training and academic exchanges aimed at developing human capacity in the Nigerian mining sector through the training of exploration geologists and mining engineers. Based on the success of the Presidential Fertilizer Initiative, the President recently approved the strategic exploration and development of phosphate and potash deposits across the country as an extension of the Presidential Fertilizer Initiative.

Nigeria is the biggest agriculture market and crop producer, and amongst the biggest consumers of agricultural nutrients in Africa. With the country’s population projected to hit 400 million by 2050, crop production will need to keep up to ensure agricultural self-sufficiency in the country. The local production of phosphate will provide a cost-effective solution of increasing Nigeria’s phosphate fertilizers application rate which at 2kg/hectare is far below the global average of 16kg/hectare and peer countries such as Kenya and Ethiopia at 19kg/ hectare and 13kg/hectare respectively. Speaking on the strategic partnership, Fatima Umar Shinkafi, executive secretary, SMDF, stated, “Phosphate is one of the 5 strategic minerals that have been identified by the SMDF for immediate intervention. Agriculture and mining have been put in the forefront of the current government’s priorities; and agro-minerals (e.g. phosphate) readily provide a good link between the two important subsectors of the economy.

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Stakeholders converge on Lagos to address Nigeria’s sustainable development gap SEYI JOHN SALAU

lobal Compact Network Nigeria (GCNN) recently convened stakeholders’ breakfast roundtable to identify concrete contributory actions towards delivering on the 2030 Agenda for Sustainable Development in Nigeria. Themed “Bridging Nigeria’s Sustainable Development Gap,” the roundtable highlighted key financing issues affecting the success of the global goals in Nigeria as well as possible solutions to the problems. Muhammad Sanusi II, the Emir of Kano and SDG advocate, said the global goals were achievable if all stakeholders collaborate to make them work. “As Nigerians and Africans, we are primarily responsible for the SDGs. We do not need the UN to tell us to fight poverty; we do not need anyone to tell us that we should be concerned about malnutrition, about infant mortality, about maternal mortality,aboutyouthunemployment, because we are primarily the victims of the systems that we have created. Many of these issues go back to the roots of nonattention to the SDGs both from thegovernmentandthepopulace in general,” Sanusi stated. Lise Kingo, CEO/executive director of the United Nations Global Compact, said while prog@Businessdayng

ress on the global goals had been made, it was also clear that four years in, the continent was not on track. “We are the last generation that can stop runaway climate change, and we are the first that can eradicate poverty. One common thing we have found in over 70 countries across the world where we are present is that the private sector has a crucial role to play in achieving the SDGs.” Soromidayo George, the chair of GCNN and director of corporate affairs and sustainable business at Unilever in Ghana and Nigeria, said the time to take actions to address the challenge at hand was now. “Undoubtedly, poverty today is a real and present danger. It harms our women and children, it saps our men, drains national productivity, and to say it is an urgent problem understates the point.” “For the SDGs to be realised in Nigeria, companies should integratethemintotheiroperations. Theseintegrations,nomatterhow small they might be from individual companies, will not only go a long way in reducing poverty in Nigeria,theywillalsoformawhole that can make Nigeria achieve the SDGs by 2030,” said Bola Adesola, senior vice chairman for Africa at Standard Chartered Bank and vice-chair of the board of the UN Global Compact.

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Many voices, one heart STRATEGY & POLICY

MA JOHNSON

“I

t is unfortunate, but the truth is that almost every set back the NA has had in our operations in recent times can be traced in to insufficient willingness to perform assigned tasks: Or simply insufficient commitment to a common national/military course by those at the frontlines”- Lt Gen Yusuf Buratai, COAS, This Day, June 19, 2019. Before delving into the main thrust of this article, let me start by acknowledging our soldiers for the courage and devotion displayed so far in combating the war on terror. Anywhere in the world, there are good and bad soldiers. One would expect the good soldiers to be more than the bad ones. The bad apple theory readily comes to mind when one considers many voices raised concerning the commitment and loyalty of our soldiers to the counterinsurgency operations in the north-east of Nigeria. The bad apple theory emphasise that the corrupt practices in security organisations namely the police force, army, navy, air force and other agencies is due to some “bad apples” that are found in a clean barrel. Simply put, corruption or incompetence is brought about by a few bad elements that are working in a presumably, clean and ethical security system. The fact is that the system comprising the good and bad security personnel is not as clean and ethical, as

one would have expected. As expected, there have been many voices of varying amplitude from Nigerians regarding the security situation in the country. The reason is not far-fetched. It is because there can be no meaningful development in an environment that is insecure. The quote above reminds me of the book “On the Psychology of Military Incompetence”, in which the author Norman F. Dixon, a retired lieutenant colonel of the British Army, admitted that the costly mishaps and tragic blunders that occurred in a century of wars he examined were due largely to military incompetence. Dixon’s unique and penetrating book x-rays 100 years of military inefficiency from the Crimean War, through the Boer conflict to the disastrous campaigns of the First World War and calamities of the Second. The book brought out an interesting perspective about military leadership, military organisations and who they potentially attract for leadership responsibility. But Dixon was by no means the Chief of the General Staff of the British Army. He wrote the book based on his experience as a field officer during the Crimean War. Dixon’s published work applies insights from psychology to military history. From the spate of killings of our soldiers and civilians by insurgents recently, anyone with intellectual interest in the Nigerian-styled insurgency would have tried to figure out what could be responsible for the negative remarks from a service chief to his officers and men. Every military leader is eminently entitled to his opinion on the performance of his officers and men. The opinion, however, must inspire those who are faithful, loyal and honest in the performance of their responsibilities. One keeps wondering what would have

provoked Gen Buratai to say before the press that his troops are insufficiently committed to a common national/ military course. The disparaging remarks from the head of an army on his troops during internal security operations have far-reaching implications. I know that there is a huge difference between interest and commitment. When one is interested in doing something, it is done as convenient. The moment one is committed to doing something; there are no excuses, only results. Those with leadership qualities commit and follow through. That is why I have always drawn inspiration from the Harvard Business Review publication on leadership. Somewhere in the book, it is cleverly stated that: “A peacetime army can usually survive with good administration and management up and down the hierarchy, coupled with good leadership concentrated at the top. A wartime army, however, needs competent leadership at all levels. No one yet has figured out how to manage people effectively into battle; they must be led.” Every soldier in the battlefield must have leadership qualities. Leaders take responsibility and they are the ones who “deliver the goods.” When one examines our polity, what is common in recent time is that our so-called leaders do not always take responsibility for anything in the wrong. What some of our leaders do on many occasions in defence of their errors is to set blame game machinery in motion. Benjamin Franklin says that “I never knew a man that was good at making excuses who was good at anything else.” Some civilians perceive from remote that our soldiers who are involved in fighting insurgents work as a team. If our soldiers were not working as a team, the entire northern part of Nigeria could have been taken over by insurgents. Nigerians know that our soldiers are not

‘

One vital point about team work is that you always have your colleagues on your side. It is pulling together all your resources-men and material, not pulling apart. Yes, there could be many voices. But they must have one heart. This does not happen until there is an environment that has a clean and ethical security system; an environment of encouragement and support

equal in experience, talent, or education but in commitment. The commitment of our soldiers must start with their leaders and radiate to the entire team. If you are a leader, the true measure of your success is not getting people to work, neither is it by getting them to work hard. It is by getting people to work hard together, and this to my mind takes commitment. One vital point about team work is that you always have your colleagues on your side. It is pulling together all your resources-men and material, not pulling apart. Yes, there could be many voices. But they must have one heart. This does not happen until there is an environment that has a clean and ethical security system; an environment of encouragement and support. So leaders need to take responsibility for working to create that ideal environment in order to reduce significantly “bad apples” in the organisations they lead. Team work of the military in particular, is never tested in peace time. It is tested when adversity hits. When there is danger, the military is faced with reality of the battle space. Many years of insurgency has revealed where our military is strong and where their weakness lies. Most organisations do not talk about their weakness. But the reality is that losses of soldiers and civilians can be learning experience if the attitudes of our leaders are right. Our Creator allows us to experience the low points of life in order to teach us lessons we could not learn in any other way. Irrespective of our views on insurgency within the country, let us have one heart, full of appreciation and praise. Thank you!

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

Environmental management in Nigeria’s maritime sector

nvironmental management has become increasingly essential as a component of business operation, and one that needs to be successfully sustained. The need for constant evaluation and appraisal of the environment, safety and security in Nigeria’s maritime industry has drawn urgent attention because of the increasing environmental regulations and requirements further needed in the maritime sector. In 1987, the discovery of a major toxic waste dumped by a foreign company at Koko town near Warri in Delta State, Nigeria led to the establishment of the Federal Environmental Protection Agency (FEPA) by Decree No. 58 of 1988. Ports contribute significantly to the economic development of nations and so the awareness about the adverse effects that Ports pose to the air, water, soil and sediments needs to be evaluated. While efficient ports are very important to the economic development of the surrounding environment, the related ship traffic, handling of the goods in the ports and the hinterland distribution can cause a number of negative environmental impacts. Ship-source marine pollutants which emanates from cargo carried or waste generated on board usually contains oil or oily mixtures and noxious substances. This usually accumulates from machinery operation or from the domestic activities of the crew living on board. This also includes ship borne pollutants which include garbage, solid wastes and antifouling paints on ship hulls. The incidence of ship generated marine pollution has increasingly engaged the attention of the international maritime community in its effort to promote safe shipping and the protection of the marine environment and the growing concern about pollution centres on the potential for the shipping business to nega-

tively impact the marine environment and the related biodiversity within the maritime field. It is imperative that stakeholders not only understand the positive effects of green solutions from an ecological point of view but also see the positive synergies regarding operational and economic performance. It therefore requires structures such as processes, technologies and methods that support green strategies that will help fulfil both economic and environmental objectives that will ultimately help contribute to sustainable growth and development. FEPA regulated the collection, treatment and disposal of solid and hazardous waste from municipal and industrial sources, and the Environmental Impact Assessments (EIA) mandatory for any major development project likely to have adverse impact on the environment. In 1999 FEPA was replaced with the National Environmental Standards and Regulations Enforcement Agency (NESREA). The ever increasing global concern on environmental health demands that wastes be properly managed and then disposed of in the most friendly and acceptable way. This is to minimise, and were possible, eliminate the potential harm to humans, plants, animals and our natural resources. Solid waste, as an example, has become an important issue in Nigeria: Piles of wastes are often found near roads, in rivers and in areas known to be affected by flooding. This is causing significant health and environmental problems. Against the backdrop of public concern and the need for mitigating policies, the shipping industry has actively sought to curtail the negative environmental effects arising from the shipping sector. At an international level, under Annexes I, II, III, IV, V and VI of MARPOL, various legal instruments and controls have been provided to encourage regulation www.businessday.ng

and enforcement by flag states, coastal states and port state control. International Maritime Organization (IMO) identifies these sources and by their provision, port authorities are obligated to provide reception facilities for the handling of a range of waste including oil, chemical and garbage. Ports are also required to produce a Port Waste Management Plan, including information on the type and location of facilities, notification requirements, details of providers and costs. These plans are to be made available to port users, to ensure that vessels needs are met promptly with no undue delay. Studies have shown that the effects of ship based pollution on the marine environment threaten the fishing industry. Maritime sector industries such as fishing contribute about 3 to 5 percent to the Nigerian agriculture share of the GDP. The introduction of non-indigenous species to our aquatic environment threatens not only a very important protein source in the diet of Nigerians, but also our economic stability. The measures applied so far by IMO in terms of the conventions and their enforcement by flag state, coastal state and port state control have yielded fruitful results, especially in curtailing pollution from accidental spills arising from collisions. However, pollution from non-accidental sources continues unabated and some port authorities have been found wanting regarding the provision of the requisite port waste reception facilities. The implication is that rising levels of marine pollution from ship based discharges are expected in these ports in the long run. Lack of adequate waste reception facilities in developing countries’ ports is such that vessels have no choice but to discharge waste at sea. However, some vessel operators prefer to dump waste at sea, where there is a low risk of being caught, rather than use the provided

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FESTUS OKOTIE facilities and thus pay the required user fees. In West and Central African ports, facilities are becoming available in varying forms but remain inadequate hence ship waste collection processes in the ports are not only inefficient but also their management remains poor. Currently the Nigeria Ports Authority (NPA), our custodian of national ports, does not own or operate waste reception facilities, but outsources that responsibility to a private pollution control company which helps provide port reception facilities in all navigational districts. It is evident that solid waste management in Nigeria is plagued with inefficient collection methods, insufficient coverage of the collection system, improper disposal, lack of institutional arrangement, insufficient financial resources, absence of bylaws and standards, inappropriate technology, etc. While the policies and laws are fragmented and are formulated not on nationally generated baseline data, participation of the people in the policy formulation and implementation is lacking, and enforcement and monitoring of laws and policies is inadequate. It is therefore necessary that the legal (policies and laws), institutional, political, socio-cultural, financial, economic and technical aspects of solid waste management be given optimum attention with all seriousness. Okotie, a maritime transport specialist, writes via fokotie. bernardhall@gmail.com, Fokotie@bernardhallgroup. com

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Mokyr’s a culture of growth: A review in the African context (2) RAFIQ RAJI

Convention is fluid emember when if you wore sneakers with traditional attire, you would likely be thought a misfit? But today, it is consider quite cool, isn’t it? All it took was a few celebrities to wear the abnormal combination. This second example would resonate with Muslims. Some Muslims wear trousers that stop just before the ankle as a religious practice. It wasn’t considered a “cool” thing to do. Have you noticed, however, that supposedly “cool” suits nowadays come with trousers that stop just before the ankle? Celebrities are cultural entrepreneurs. They are cultural change agents. It is not always the case that they seek to change culture deliberately. For some, it is precisely their bold actions that throw them into the limelight. Others simply rode on popular culture and acquired fame in the process and thereafter are able to introduce new trends of their own. It is also the case that through them, people can be dissuaded from negative cultural practices. “What is it precisely cultural entrepreneurs do? Mokyr posits “they are persons who become sufficiently influential to change the cultural menus of enough people and who persuade many of them

to adopt the cultural variants they are proposing.” To be sure, not all cultural entrepreneurs succeed. Those who do are individuals who successfully contested and overthrew existing authorities in a specific area of culture and created a competing variant”. Two hugely successful cultural entrepreneurs of their time are Isaac Newton and Francis Bacon, whose legacies endure to this day. More relatively recent examples are prominent economist John Maynard Keynes and American civil rights leader Martin Luther King Jr. If these examples do not resonate with you, maybe this would: an Oprah Winfrey qualifies as one. Put simply: “influential individuals affect the beliefs and preferences of others”. They are probably also the most effective channel through which culture can be changed today. Who are our celebrities? Are the beliefs they espouse progressive or retrogressive? Are the contents of our arts ones that spur innovation and new thinking or the entrenchment of old beliefs? Institutions can be created or remodelled to tune our cultural output towards progressive goals. For instance, what are the criteria by which our censor boards approve art, movies, music, etc.? A warning. Cultural entrepreneurship is a hugely risk affair. In Europe, Mokyr recounts, “New people challenged the conventional wisdom in every area of knowledge and thought. To be sure, a variety of conservative bodies made serious attempts to suppress innovators and some of the most innovative cultural entrepreneurs paid with their lives.” But while during the European Enlightenment, “fragmentation, footlooseness, and

the proliferation of printing presses meant that it became increasingly difficult for politically powerful incumbents to suppress subversive and heretic new beliefs generated by cultural entrepreneurs,” with the internet and technology, it is much easier today to be one with not as much risk or effort. Modern man vs traditional man I digress from Mokyr (2016) a little bit. Who is a modern man? And how does he defer from the traditional man. To the ignorant, the instinctive definition veers towards the ethnic, tribalistic or racist. It is no such thing. Geert Hofstede’s (2001) Culture’s Consequences: Comparing Values, Behaviours, Institutions, and Organisations Across Nations quotes now late Harry Triandis’ (1971) Some psychological dimensions of modernisation, a paper he presented at the 17th Congress of Applied Psychology in Liege, Belgium on the differences between the two as follows: A modern man “is open to new experiences; relatively independent of parental authority; concerned with time, planning, willing to defer gratification; he feels that man can be master over nature, and that he controls the reinforcements he receives from his environment; he believes in determinism and science; he has a wide, cosmopolitan perspective, he uses broad in-groups; he competes with standards of excellence, and he is optimistic about controlling his environment.” The traditional man, however, “has narrow in-groups, looks at the world with suspicion, believes that good is limited and one obtains a share of it by chance or pleasing the gods; he

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Have you noticed, however, that supposedly “cool” suits nowadays come with trousers that stop just before the ankle? Celebrities are cultural entrepreneurs. They are cultural change agents. It is not always the case that they seek to change culture deliberately

estimated Nigerian population. This means that any increase whatsoever in the cost of living as the proposed VAT increase will do - will be a burden on the people. However, the more logical but less obvious reason is that the increase in VAT in Nigeria will essentially lead to a hike in double taxation. In simple terms, double taxation refers to taxing the same income twice. As noted earlier, a nexus is required between the income (taxes) and government expenditure. Considering that governments use taxes to raise income to meet expenditure needs, it is essential to examine what the government at various levels in Nigeria is required to expend revenue generated via taxes on. Provisions of basic social amenities still remain at the core of the government’s duty to improve the living conditions of its citizen. Unfortunately, this is largely not the case in Nigeria at the moment. Security in Nigeria has become personal and the cost is borne by all and sundry. The threat to lives and properties remains high and exorbitant fees are being paid for street security and/or deployment of security solutions to homes and office premises. It is becoming increasingly risky for many to travel on road even over short distances due to the high rate of kidnapping necessitating the need to hire security personnel on such travels or find an alternative and more expensive way to travel. In a publication by Quartz Africa in May 2019, it was stated that “Nigeria has one of the world’s highest rates of kidnapfor-ransom cases” alongside countries like Venezuela, Mexico, Yemen, Syria, the Philippines, Iraq, Afghanistan and Somalia.

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Modernise your philosophy of life Being a modern man does not require that you give up your religion or your traditions. Instead, it is underpinned by the philosophy that there is a rational explanation for everything. In applying this ethos, you approach problems objectively, seek new and better solutions, and continually seek to improve your lot. The traditional man, however, seeks irrational and mystical explanations, and procures the services of its dubious practitioners when in doubt. The outcome is very well what underpins our problems as a country. Whether it is perennial traffic in a busy Nigerian city, power failure on end, lack of reliable potable water supply, and so on, the “traditional man” outlook of most of our compatriots is why we live relatively miserable lives. So, my questions to you are thus: Which of a modern or traditional man as described above is better? And which one are you? Become better. Better still, become best.

“Dr Raji is chief economist at Macroafricaintel. He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @ DrRafiqRaji)”

Proposed hike in VAT: An increase in double taxation he federal government of Nigeria recently announced plans to increase Value Added Tax (VAT) in 2020 by 0.5 percentage points from its current rate of 5 percent. Among the reasons given for the proposed increase include raising revenue to meet the obligations of the government and increasing the income generated from nonoil sources. As the VAT rate in Nigeria is one of the lowest in the world, one might be moved to think that the proposal is completely innocuous and for the good of the populace. A deeper analysis though suggests that this might actually be a hike in double taxation. Fiscal policies remain one of the major tools of governments worldwide to bring about economic growth and development for their citizenry. The other tool is monetary policy which is majorly under the purview of the Central Bank. The main instruments of fiscal policies are taxes and expenditure used to spur economic growth through a strategic combination. An increase in taxes results in increased income for the government which implies that there will be more money available to spend on projects which are critical and essential to improve the living standards of the people. If taxes are such important tools in the hands of government, why then is the proposed VAT increase in Nigeria generating such uproar among the populace? The simple answer to this question is that a large number of Nigerians earn a very low income and therefore have a very limited purchasing power. In fact, the World poverty clock estimates the number of people living in poverty in Nigeria at about 94.4 million which represents about 47.7 percent of the

identifies with his parents and receives direction from them; he considers planning a waste of time, and does not defer gratification; he feels at the mercy of obscure environmental factors, and is prone to mysticism; he sees interpersonal relations as an end, rarely as means to an end; he does not believe that he can control his environment but rather sees himself under the influence of external, mystical powers.”

PHILIP OGUNTOYE As long as the threat to lives and properties remain, Nigerians will have no choice but to keep expending a substantial part of their already taxed income on security. The health sector also remains an avenue for the government to reassure the citizens of its commitment to their general welfare. Public hospitals in the country are in a deplorable state. Nigerians exhibit more confidence in foreign health care and raise huge funds to undergo treatment abroad. Many claim that the availability of the facility in Nigeria is still not sufficient to guarantee quality healthcare considering the quality of medical education in the nation. Health education in Nigeria is poorly funded whilst workers are also poorly treated. Many Nigerian health professionals are seeking greener pastures outside the country and are excelling in their field while Nigeria still remains underdeveloped. The incessant strike by medical practitioners poorly catered for leave many families with no choice but to seek medical attention from private hospitals or even abroad where they can afford it. Sadly, the budget allocation to the health sector as a proportion of the total marginally rose by 7.43 percent to N365.77 billion in 2019 from N340.46 billion in 2018, and this is grossly inadequate to bring about the required change in the sector. Developing human capital via education is a critical venture for the government to expend funds into. Public schools have become moribund and the privately-owned ones charge premium fees and parents and guardians are left with no choice but to pay. There is also the case of incessant strike in Nigerian universities which unnecessarily

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prolongs students’ stay in school and most of it can be attributed to the failure of the government to fulfil funding promises to the Universities. The United Nations Educational Scientific and Cultural Organization (UNESCO) recommend a budgetary allocation to education of 15 to 20 percent of the total budget of developing countries but in Nigeria, the budgetary allocation has consistently fallen short of this with about 7.05 percent allocated to education in 2019. Attending private schools should be purely optional and should never be conditioned on the fact that the public schools cannot provide comparable quality education as is majorly the case now. The foregoing emphasizes that citizens having to pay for what the government has taxed their income for is simply double taxation. Working class citizens continuously pay the government to do what they still expend their personal resources on. Since the people who bear the direct burden of taxation in Nigeria today are the same people who provide the infrastructures that the government is supposed to provide, it is clear that they are already unconsciously under the burden of double taxation. Any increase in tax, be it VAT as is being proposed now or any other one is surely not just an increase in taxes but in double taxation. Until there is a guarantee and manifest action by the government to provide amenities for which citizens have been taxed for, any increase in tax rate remains a double jeopardy.

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Tuesday 15 October 2019

BUSINESS DAY

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

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Facts, figures and the lure of fairy tales

he Economic Advisory Council took off Wednesday, October 9, with an additional task that represents a tall order. At the inauguration, President Muhammadu Buhari dismissed existing data on Nigeria and charged them to develop data that would reflect more accurately happenings in the economy. The president deemed the collation and publication of this data as “the most important national assignment” of the times. President Buhari stated: “As you develop your baseline study, I would like you to focus on primary data collection. Today, most of the statistics quoted about Nigeria are developed abroad by the World Bank, IMF and other foreign bodies. Some of the statistics we get relating to Nigeria are wild estimates and bear little relation to the facts on the ground. This is disturbing as it implies we are not fully aware of what is happening in our own country. We can only plan realistically when we have reliable data.” He boasted of the achieve-

ments of the government he leads in its self-perception. “As you are aware, as a government, we prioritised agriculture as a critical sector to create jobs and bring prosperity to our rural communities. Our programs covered the entire agricultural value chain from seed to fertiliser to grains and ultimately, our dishes. As you travel in some rural communities, you can clearly see the impact. However, the absence of reliable data is hindering our ability to upgrade these programmes and assure their sustainability”, President Buhari stated. The President also dismissed claims and data of aid agencies working with the Internally Displaced Persons (IDP) in the troubled North-East. He asserted, “Today, we hear international organisations claiming to spend hundreds of millions of dollars on IDPs in the North-East. But when you visit the camps, you rarely see the impact. In 2017, when the National Emergency Management Agency took over the feeding of some IDPs in Borno, Yobe and Adamawa, the amount we spent was significantly lower than the claims made by these international organisations.

Therefore, actionable data is critical to implement effective strategies to address pressing problems such as these humanitarian issues. I, therefore, look forward to receiving your baseline study as this will help us shape ideas for a sustainable and prosperous future,” President Buhari said. At the heart of the President’s statements are matters of philosophy, perception and reality. The federal government has consistently claimed achievements, particularly in agriculture, that vary with the facts that citizens see. The government also quarrels with the data shared by the National Bureau of Statistics (NBS), one of the most respected bureaucrat organs of Nigeria. The claims sometimes tend towards the ludicrous such as the assertion by the former Minister of Agriculture Audu Ogbeh that rice mills in Indonesia shut down because of reduced demand arising from higher rice production in Nigeria. The ambassador of that country debunked the claims. It is understandable for the government to seek positive narratives. Such narratives must, however, be congruent with the experiences and realities that operators of the

economy and citizens can see. Patriotism does not change economic facts. It is as well that the president has laid down this significant marker for the EAC. The presidential council is similar to the Economic Advisory Council to the Prime Minister of India. Members of the EAC are reputable economists with names to protect, individually and collectively. The perception is that Mr President appointed them for their independence, objectivity, strength of character and adherence to the facts. Chairman of the PEAC, Doyin Salami, affirmed the independence of the body and its focus at the event. He said the EAC’s focus is “Nigeria first, Nigeria second, and Nigeria always.” They would prioritise the Nigerian people rather than mere numbers. Salami stated: “Our goal is that the economy grows in a manner that is rapid, inclusive, sustained and sustainable so that Nigerians will feel the impact.” Nigerians look to the EAC for facts and figures that speak truth to the situation of the country without any fairy tales. It is what the economy needs and what Nigerians deserve in these hard times.

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Tuesday 15 October 2019

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Whatever happened to Philippines debt slavery?

n May 2017, Forbes released a column, which claimed that “New Philippine Debt of $167 billion could balloon to $452 billion: China will benefit.” It was written by Anders Corr, who was portrayed as an independent geopolitical risk analyst. He predicted that the Philippines would be in debt slavery at the end of the Duterte era. Now that half of that prediction period has passed, let’s see whether Corr was right. The projections According to Corr, the Philippine government debt of $123 billion would soar to $290 billion because China would impose high interest rates on the debt: “Over 10 years, that could balloon Philippines’ debt-to-GDP ratio as high as 296 percent, the highest in the world.” Based on flawed data and mistaken assumptions, the prediction sounded idiotic. Yet, Forbes’s brand reputation and Corr’s background felt credible to international media. Most of his clients are linked with Pentagon, its allies and defense contractors. He has been an associate for Booz Allen Hamilton in Hawaii (as was Edward Snowden when he worked for CIA) and served half a decade in US military intelligence. He has conducted “research” for US Army in Afghanistan, at US Pacific Command and US Special Operations Command Pacific. And he seems to specialise in efforts to destabilise critical areas in Asia. In his projection, Corr assumed absence of transparency on the in-

terest rate, heavy conditionality and repayment terms of $167 billion of new debt for the Philippines. Due to accrued interest (which he grossly overestimated), “Dutertenomics, fuelled by expensive loans from China, will put the Philippines into virtual debt bondage if allowed to proceed.” (In reality, the government’s borrowing sought to rely mainly on domestic sources, to alleviate foreign exchange risks). Corr offered no evidence to substantiate the assertions. Yet, the commentary was quickly recycled across the Western media. The tacit assumption seems to have been that since Forbes represents world-class quality, so do its contributors (even those that have been subsequently fired, such as Corr). So what’s the truth about the alleged “debt bondage”? The realities Let’s compare Corr’s forecasts with projections. Between 2017 and 2022, most Philippine authorities estimated the debt would mildly decline. My estimate was slightly more conservative because I expected trade wars to begin to bite by 2018-20. In contrast, the implication of Corr’s claim was that Philippine debtto-GDP ratio would soar to some 150 percent in year-end 2019 and to 296

percent by 2022 (Figure). In retrospect, Philippine authorities may have been 0.5-1 percent too optimistic, while I may have been too pessimistic by 0.5-1 percent. What is certain, however, is that Corr has already proven wrong by almost 110 percentage points (!). Corr’s 2017 “predictions” have nothing to do with economic realities. It is also quite likely that, in another three years when Duterte will leave his job, both Philippine authorities and I will prove right by an error range of 1 percent to 2 percent, whereas Corr will prove wrong by some 250 percentage points (!). When investment analysts commit such failures in markets, they are fired, banned or imprisoned. That’s not the case with Corr. Despite disastrous projections, he has been used as an “expert” by major international media, such as Bloomberg, Fox, CNBC, New York Times, Nikkei Review, Al Jazeera, and UPI. More recently, Corr predicted worldwide “financial carnage” if China intervenes in Hong Kong (Institutional Investor, Sep 23, 2019); claimed that millions of Uighurs linger in “Chinese concentration camps” (Washington Free Beacon, Jul 15, 2019); blasted the “Trump-Xi’s G20 trade truce” (Observer, Jul 1, 2019); and predicted that the division of the Philippine island Palawan into three provinces was a part of “China’s territorial expansion move” (Rappler Apr 13, 2019). In the Philippines, even the Defense Forces Forum shared Corr’s “news” (Facebook, April 29,

2018) that the country had been invaded by 45,000 Chinese covert military operatives (he mistook online gaming operations, which China wants Philippines to eliminate, with covert military cells).

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In early 2017, a Forbes contributor claimed President Duterte will bankrupt the Philippines economy in five years. Half of the period is gone. Will the country default in 2022?

Economic hit men Corr’s political links are most intimate with neoconservative and interventionminded US senators, such as Marco Rubio, and vulture capitalists, including Paul Singer (who funds the abovementioned Washington Free Beacon) that have recently supported destabilisation in Hong Kong, Philippines and elsewhere in Asia. He also cooperates with the radical conservative Japan Forward, which once recommended apartheid-policies to manage immigrants in Japan, the French Catholic daily La Croix International and the Union of Catholic Asian (UCA) News, which has since 1979 operated in the same Asian countries as Voice of America and the National Endowment for Democracy (NED). These catholic outlets work closely with the anti-Duterte leaders of Philippines Catholic church and the Liberal Party which suffered a meltdown in the 2016 election. Since Corr’s predictions have no predictive power, the definition of an “economic hitman” may be more applicable in his case. The real question is, why are such economic hitmen still used as “independent analysts” by some of the world’s most powerful international media? The commentary was originally released by The Manila Times on October 7, 2019. Dan Steinbock is the founder of Difference Group and internationally recognised expert of the multipolar world economy. He has served at the India, China and America Institute (US), Shanghai Institute for International Studies (China) and the EU Center (Singapore). For more, see http://www.differencegroup.net/

One year shy of 60, Nigeria still gropes in the dark

he Lugardian contraption called Nigeria has come of age. Hasn’t it existed for over a century? It was in 1914 that the southern and northern protectorates were amalgamated, and the geographical space was called Nigeria. So, Nigeria is a disparate political entity and a conglomeration of ethnic nationalities. And for a considerable length of time, the geographical space, which was christened Nigeria by Flora Shaw, was a British colony. During the colonial era, Nigerians who acquired western education became politically conscious. So, in 1922, the first political party in Nigeria was formed following the adoption of the Clifford’s constitution for use in the country. Then, Nigerians were elected into the Lagos and Calabar legislative councils. More so, educated Nigerians who were conscious of the evils and disadvantages of colonial rule started agitating for the political emancipation of Nigeria. Nnamdi Azikiwe, a political ideologue and an alumnus of Lincoln University, America led the charge for the decolonisation of Nigeria. Anthony Enahoro, who moved the motion for Nigeria’s independence; Nwafor Orizu, one-time senate leader; Obafemi Awolowo, a former premier of western region and UPN national leader; Tafawa Balewa, who became our Prime Minister in 1960, and others fought relentlessly for Nigeria’s attainment of political sovereignty and freedom. Upon our attainment of statehood and political sovereignty in 1960, the departing British colonialists, who were amenable to the northern people’s political domination of Nigeria helped Tafawa Balewa to become the Prime Minister of Nigeria in 1960. He overcame his political betters like Nnamdi Azikiwe and Obafemi Awolowo to become our Prime Min-

ister in 1960. The British imperialists had clandestinely enthroned the northerners’ political hegemony and dominance of Nigeria in order to achieve their selfish and sinister goals. It’s they who institutionalised the perverse and monstrous culture of imposition of political leaders on Nigerians, which has led to the emergence of mediocre political leaders in Nigeria. That’s why after the collapse of the first republic and the end of the Nigeria-Biafra civil war, a political dark horse called Shehu Shagari beat Nnamdi Azikiwe, Obafemi Awolowo, Aminu Kano, and Ibrahim Waziri in the 1979 presidential election. And Olusegun Obasanjo was helped to power in 1999 by the king-makers and northern interests to placate the indignant Yoruba people over the annulled June 12, 1993 presidential election. Again, Alhaji Umaru Musa Yar’adua, who won the 2007 presidential election, confessed that the election which brought him to office was marred by electoral fraud. We should note that Tafawa Balewa, Olusegun Obasanjo, Shehu Shagari, and Umaru Musa Yar’adua, who were beneficiaries of Nigeria’s egregious culture of imposition of leaders on the populace, squandered the opportunities offered to them to transform Nigeria positively. And they couldn’t entrench enduring peace and unity in Nigeria, which is the bedrock of national development. Today, Nigeria is stuck in the mud of underdevelopment because it hasn’t been led by its best politicians since it became a politically independent country. However, a country’s development is intrinsically linked to the quality of leadership provided to the citizens by its national leader. The economies of Malaysia,

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Singapore, and other great Asian countries had been leapfrogged to a dizzying great height because their leaders possess political ideologies, moral probity, and leadership qualities. A good political leader, who is a visionary, imagines the type of country he wants, and works assiduously and patriotically to build that country. So, during Muhammadu Buhari’s first coming or incarnation as our civilian president, millions of Nigerians thought him to be the messiah, who would revamp our economy, evolve our own technological culture, which will be predicated on functional educational system, and entrench peace and unity in the country. And not a few Nigerians felt that his leadership of Nigeria would be a departure from Goodluck Jonathan’s clueless, tardy, uninspiring, and corrupt administration. We believed him to be the political leader, who would root out corruption in Nigeria and bring sanity to our systems of doing things given his ascetic nature and distaste for corruption. However, President Buhari’s occupation of the highest political office in Nigeria has led to his demystification. Under his watch and guidance, Nigeria is steadily and progressively going to the dogs. In his first term in office, Nigeria’s economy slipped into recession. It came out of it soon after, however, Nigeria, as a country, which has oil resources and humongous population, has not witnessed rapid economic progress and technological transformation under his leadership. Today, owing to the mismanagement of our economy, millions of Nigerians have been reduced to sub-humans. The worsening economic situation in the country has made millions of Nigerians become vulnerable to joining terrorist groups like the Boko Haram and others. The impression-

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CHIEDU UCHE OKOYE able young northern people who joined Boko Haram had been indoctrinated with distorted teachings of Islam which fire them up to levy war against the Nigerian state. Aren’t we aware that the unresolved Boko Haram incubus poses a great threat to our continued existence as one indivisible country? In addition to this, the Fulani cattle Herders, who are classified as a deadly terror group should be checked; otherwise, their murderous deeds will plunge Nigeria into a huge conflagration, which will cause its disintegration. President Muhammadu Buhari should up his game as to the leadership of Nigeria in order to improve the people’s living condition and ignite the rapid economic and technological growth of Nigeria. He should wean himself off ethnocentric proclivities and religious bias and initiate pragmatic pan-Nigerian policies, the implementation of which will transform Nigeria into a developed nation-state and assure us that he is not a sectional leader and divisive figure. Until he starts doing the right things, Nigeria will continue to grope in the dark for national redemption and salvation from the debilitating forces of national disunity and underdevelopment. Okoye, a poet, wrote in from Uruowulu-Obosi, Anambra State08062220654

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Tuesday 15 October 2019

BUSINESS DAY

Media business When M&A is crucial to survival yet Nigeria’s advertising sector is cold to it …in the face of increasing business challenges Stories by Daniel Obi Media Business Editor

lobally, Mergers and Acquisitions (M & As) is considered a strategic business tool for leveraging brand equity and also to have the competitive edge. The concept is deliberate coming together of two or more companies to form one entity which could take the form of merging all structures and employees. Experts say M&A which could be permanent or temporal has become a big part of the corporate financing all over the world. While this business concept of local firms merging has either forcefully or unilaterally been embraced by some players, it is yet to be witnessed in the advertising industry in Nigeria. What is obtainable are largely sketchy cases of foreign affiliations. In view of the increasing challenging environment occasioned by business dynamics, various stakeholders and different forums have advocated for mergers of firms in the advertising community to compete favourable in the global market but importantly to withstand storms. But the advices are not really penetrating. Biodun Shobanjo, the chairman of Troyka Holdings, who has spoken at different advertising related forums, believes that it is only when operators in the industry re-think, redefine the industry and consent to mega firms through mergers and acquisitions that the industry will further be pushed up. Addressing the outdoor segment of the advertising community

some time ago, the successful business man believed that it is due to the plethora of one-man business in the Outdoor industry that sometimes advertisers feel they are doing the agencies favour, when it should be the other way round. Also, speakers at the recent meeting of Association of Advertising Agencies of Nigeria, AAAN toed Shobanjo’s line when they emphasised collaboration among the industry operators, support of one another, discovery of more markets and finding solutions to clients challenges as solutions for survival. The speakers who included Jimi Awosika, Vice Chairman of Troyka

Holding; Bola Thomas, AAAN Trustee; Steve Babaeko, CEO of X3M Ideas and Lanre Adisa, CEO of Noah’s Ark agreed that collaboration is a way forward. But the industry appears solidly stuck in the past; satisfied with metoo agencies as the operators seem not to be interested in M&As. This is either the operators are not ready to go through the haul of the process of M&As or the operators in the entire Nigerian advertising space are treading with caution on the belief that most of the companies do not have fundamentals to enable M&A transactions. However, Innocent Nwani, Director at Hill+Knowlton Strategies

UBA deepens savings culture among Nigerians, increases customer base

“We got the patronage of loyal customers and we are happy that this saving culture is growing in the country. It is important that everybody should understand the importance of saving and save for the rainy day”, he said. According to him, key objective of the campaign is to encourage customers to save regularly. Every quarter during the campaign, UBA rewarded 20 winners with N1.5 m each. At the end of the campaign, a total of 80 winners were rewarded with N120m. Dupe Olusola, Group Marketing director of the bank said UBA is rewarded its customers because “we value our customers and secondly we want our customers to develop savings habit. www.businessday.ng

Nigeria’s IMC industry, particularly Adverting, the silent issue which nobody talks about is the Asset value and goodwill of these companies. “In M&A transactions, these two are important among several vital factors that executives, investment bankers, and other stakeholders have to consider”. Asked why agencies are not embracing M&As as part of strength, Jenkins Alumona , CEO of Strategic Outcomes Limited, an integrated marketing communication firm that has deep understanding of the Nigerian market during an interview recently linked this to ego. “There is something about the ego of some Nigerians that baffles me. I don’t understand when the economy is contracting we are having more agencies come on stream, mostly with the same approach except for a few. Agencies and media companies are not merging. It is frightening to see how we are prepared to allow our egos ruin our businesses”. Akonte Ekine, CEO of Absolute PR, based in Lagos identified lack of trust as major issue working against the concept of M&A in advertising and other industries. He agreed that there is more to M&A than name and logo but stated that business should transcend beyond an individual who started the business. He said there is fear of who loses more when the M&A does not work. For business advantage, individual companies can come together to muster the strength to bid for a business and subsequently execute the business jointly. This is part of AAAN forum recently that called for collaboration for survival in a turbulent economy.

Hollandia Evap Milk unveils Mercy Johnson-Okojie as brand ambassador

… rewards customers in promo he success of recent concluded ‘UBA Wise Savers’ campaign is what will make any other bank to consider such investment. For a year, UBA had ran a campaign, inviting customers to save a minimum of N30, 000 for three months but in instalments of N10,000 monthly. At the end of the campaign which ended last weekend, the 70-year old bank did not only develop the habit of savings among Nigerians but it increased its customer base by extra one million and increased its deposit base by additional N150 billion, says Anant Rao, UBA’s Group Head, Customer Fulfilment Centre (CFC) and Telemarketing.

Nigeria Ltd., a global communications consultancy firm said one of the factors militating against M&As in the IMC sector in Nigeria is the inability to see the bigger picture, powered by myopic and selfish tendencies. “Most of the practitioners are fixated in their mentality of ownership and- the fear of losing control. The industry is populated with people who want to call the shot, unfortunately most of them do not have enough clients to keep them afloat. This explains why most of them cannot pay their employees”, he told BusinessDay. Nevertheless, he said beyond the reasons being brandished for the lack of adoption of M&A in

“We are rewarding them because we know that it is not easy in the economy this time and this reward gives them an opportunity to have more access to cash for personal and business purposes. This is to demonstrate that they mean a lot to us and we value them”, Dupe said. In his comment, the Group Executive, Transformation and Resources, Chiugo Ndubisi, who appreciated the customers said the major objectives for this promo which were to create and encourage a savings culture and to reward loyal customers have been achieved . He promised that the bank is coming out with a bigger promo very soon

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ollandia Evap Milk, evaporated milk brand, has unveiled Mercy Johnson-Okojie as its new brand ambassador, according to a statment. As an accomplished actress, wife and mother, Mercy Johnson-Okojie perfectly embodies Hollandia Evap Milk’s allrounder brand proposition. With this partnership, she will be able to share how the brand has enabled her achieve goals on multiple fronts, while inspiring consumers who aspire to do same. Mercy’s success is a testament to her multiple talents and skills. In parallel, Hollandia Evap Milk is creamy, tasty and nourishing, and it is an all-rounder evaporated milk and ideal as the perfect accompaniment for a variety of meals, foods and drinks. Through her versatility, Mercy @Businessdayng

Johnson-Okojie would bring her lifestyle choices and influence to bear to fully relate the nutritious benefits of this wholesome allrounder Hollandia Evap Milk to every member of the family. Chi Limited’s Managing Director, Deepanjan Roy in the statement said that Mercy Johnson-Okojie’s passion is evident in everything she does, and she truly embodies the ideal qualities that the brand wants to be associated with. “We have chosen Mercy Johnson-Okojie to be the face of the Hollandia Evap Milk brand as we believe she will inspire a much larger audience to understand and adopt Hollandia Evap Milk for its quality nutritional benefits, convenience and value for money. We are thrilled to have her as our Hollandia Evap Milk Brand Ambassador,” he said.

Tuesday 15 October 2019

BUSINESS DAY

Branding

Japanese imaging giant, Canon deepens Nigerian market … Invites customers to Discovery Week Daniel Obi

anon, imaging solutions provider which officially established its presence in Nigeria in 2016 is deepening its camera and printing solutions market, a decision primarily informed by the big size of the Nigerian market. With new range of products and programmes, the Japanese multinational corporation intends to have a strong grip of the most populous African market especially at a time picture consumption is growing. “Today, almost everybody clicks for pictures because of plethora of devices. It is therefore up to the camera manufacturer to show the limitation of smartphones as regards quality pictures and to convert a percentage of the customers who are clicking pictures to camera usage”, Amine Djouahra, senior manager sales and marketing – B2C, Canon Central & North

Africa said in Lagos. Speaking with BusinessDay at the start of Canon’s Discovery Week, a programme designed to meet, engage with customers, Amine Djouahra noted that many people clicking and posting pictures daily today will develop interest into photography. “Some

L-R: Amine Djouahra, sales & marketing director - B2C, Canon Central/North Africa and Hakeem Salam, Canon Nigerian Professional Photographer during the launch of new Canon products in Nigeria

Three more exceptional children added to Indomie’s Heroes Hall of Fame Daniel Obi

n continuation of Dufil Prima Foods Plc, maker of Indomie Instant Noodles, Corporate Social Responsibility (CSR) initiative for children, has unveiled and rewarded three more heroes as winners of the 2019 Indomie Independence Day Awards (IIDA). Each awardee went home with a cash scholarship fund of N1 m courtesy of Dufil. Additional donations came in from kindhearted individuals and corporate organisations. With the emergence of this year’s set of winners, a total of 42 winners have now been rewarded over the 12 year existence of the initiative. The award which is in three categories: Physical, Social and Intellectual Bravery categories, saw 13 year old Yahaya Zaki from Sokoto State, who risked his life entering into a well to save a young girl who had slipped and fell inside, claiming the Physical bravery category. Winning the Intellectual bravery category was a 14 year old aspiring mechanical engineer, Anthony Lawrence from Umuokpara Dibia Okohia Isiala Mbano local government area of Imo State. He won for constructing a functioning prototype police patrol van employing used carton boxes, glue and electronic components he

will like to go professional or into enthusiastic amateur but keen into high quality service. It is Canon’s role to be part of this transition because the smartphone cannot give you the quality of pictures premium cameras can give you”, he said. He reiterated Canon’s strategy

salvaged from the waste bin; truly demonstrating the ingenuity of a Nigerian child. The third winner, Kanyeyachukwu Tagbo-Okeke is an autistic artist who helps other autistic kids by raising awareness about autism. Kanye, a 9 year old who lives in Maitama, Abuja also won the sum of N1 scholarship award in the social bravery category. While giving his welcome address, the Chief Executive Officer, Tolaram Group West Africa, Pawan Sharma, said the initiative was established to fill the gap that exists in celebrating and rewarding the positive efforts, strong character and achievements of many young children who have exhibited various acts of courage and heroism at one time or the other within the country. “This event is noteworthy as it is in consonance with the core values and deep rooted belief of our company and the brand (Indomie) that in every child lies what it takes to become great”. In his keynote address, human rights advocate, Segun Awosanya (aka Segalink) in his speech titled, ‘Equipping the Nigerian child for innovation in a climate of accelerated global advancement’ expressed that “Children are the arrows in our quiver, they are the innovators, change makers, and world changers we shoot into the future to accomplish a task we may never be able to do ourselves.” www.businessday.ng

to play a role in every picture and video but beyond that, Canon would like to give customers the chance to improve, change lives with the emerging industrial and emerging technologies Djouahra who identified Nigeria as its biggest market said the company has extended its warranty period to two years to satisfy customers who are conscious of service and the company also came with different products to meet different customers’ expectation. The Canon Discovery Week, dedicated to professional photographers, amateur or occasional, aims to get to know Canon users better by giving them the opportunity to interact with our team, which is more than happy to share best practices and give advice on Canon products. During the customers’ week, customers will have the opportunity to immerse themselves in various experiences that will give them the opportunity to develop their creative skills, with the support of the Canon team.

Advertising body holds 14th edition of creative festival

he Association of Advertising Agencies of Nigeria (AAAN) has set out plans to hold its 14th edition of the Lagos Advertising and Ideas Festival (LAIF) awards on December 1,2019 In a statement, the AAAN Publicity Secretary, Jenkins Alumona said the award will be held in Lagos in December, this year. The LAIF Awards, which commenced in 2006, was instituted by the AAAN with the aim of recognising, rewarding and fostering creative excellence in all areas of marketing communications. The statement quoted Chairman, LAIF Management Board and AAAN Vice President, Steve Babaeko, as saying that this year’s awards will be centred on storytelling and the authenticity of the African story. The organisers disclosed that the awards will have three major events, namely the LAIF Seminar/Exhibition, Young LAIFERS Competition and the LAIF Awards Dinner. The LAIF Seminar/Exhibition is expected to attract practitioners and non-practitioners from the marketing community, who will have an opportunity to engage with local and international brand luminaries as they provide in-depth insight into key marketing and marketing communications challenges and proffer solutions to the posers identified.

‘Pursuit of Exponential Development’ tops discussion at FUTO Alumni lecture in Lagos Daniel Obi

dubuisi Ekekwe, Chairman of FASMICRO Group who also writes regularly in the Harvard Business Review will deliver the keynote address of the Federal University of Technology Owerri (FUTO)Alumni Biennial Lecture slated for October 24 this year at Nigeria Institute of International Affairs, Lagos. He will discuss ‘The Pursuit of Exponential Development’ at the event which would also attract other the best minds for search of solutions for personal and national advancement. His topic becomes germane as the world is fast moving away from traditional thinking to predictive thinking, a paradigm shift expected to spur innovations and development. It is therefore expected that exponential development will first occur in thinking and subsequently manifest in the environment and the economy. Any nation ready to pursue exponential development therefore must alter its tradition thinking to futuristic view and prepare its citizens especially the youth on this journey.

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Pursuing exponential development has become very critical for Nigeria, the country with estimated population of 198 million which is expected to rise to about 400 million in the next 30 years, to avoid consequential insecurity, economic and environmental disaster. Today, Nigeria must seriously rethink its poverty reduction strategy as the country with over 87 million people living in extreme poverty, has overtaken India as the country with largest number of people in extreme poverty living on less than $1.90 a day. Ndubuisi Ekekwe’s paper at the FUTO Alumni event will therefore be thought-provoking as he shares strategies to pursue exponential development from many facets. Other great minds lined up to share their visions and positions on the quest for technological advancement include Kingsley Fregene , Group Leader for Robotics & Intelligent Systems at Lockheed Martin, Advanced Technology Laboratories (LM ATL); Sam Amadi, former NERC MD, the Chief Ideas Officer 6th Sense; John Ugbe, Multi choice MD; Kashim Ali, Partner Impact Engineering Ltd; Lynda Madu, @Businessdayng

Associate Director Corporate Development and Services, Nestoil Group amongst others. This year’s lecture is the 6th in series. The first edition held in 2006 on the topic “Power and Development in Nigeria: seeking that workable solution” was delivered by Bart Nnaji under the distinguished Chairmanship of Dora Akunyili of blessed memory. As technology continues to evolve, and processes become more sophisticated, organizations and nations are racing to improve approaches and models to produce rich governance models. “Nations, Organizations and people are redesigning and upskilling their capabilities to take full advantage of digital opportunities for competitive advancement. With these in mind, we continue to raise the bar of our conversation with every topic of the Biennial lecture series. So this 6th edition, we bring that international platform that would allow experts to share and discuss latest practices, ideas and technology that can transform Nigeria and Africa”, explained the Chairman of the Lagos Chapter and the Biennial lecture organising Team, Collins Opara in a statement.

Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINESS DAY

COMPANIES & MARKETS

COMPANY NEWS ANALYSIS INSIGHT

DEALS

ACA sells Cornerstone Tower to strategic investor after 25% return LOLADE AKINMURELE

eading panAfrican investment firm, African Capital Alliance (“ACA”), has sold an A-grade office building in Lagos, Cornerstone Tower, for an undisclosed fee to a strategic investor, Everty. ACA’s pioneer Real Estate Fund, Capital Alliance Property Investment Company (“CAPIC”) made the investment in partnership with Cornerstone Insurance Plc. and Fin Insurance. CAPIC is a $165 million fund established to invest in real estate and real estate related opportunities in West Africa. The fund invests in residential, retail, office and hospitality assets. The firm is also in the process of launching CAREN II, which is an income and growth product. Cornerstone Tower, located in Victoria Island, was completed in April 2019 and has 13 floors comprising 24,000m2 of gross building area, and 12,000m2 of gross lettable space, along with features such as raised floors and multi-level parking.

Cornerstone Tower received an IFC Excellence in Design for Greater Efficiencies (“EDGE”) provisional certification as a green building, a recognition given to encourage developers to reduce their buildings’ energy and water consumption by significant percentages, thus lowering their potential carbon footprint. Obi Nwogugu, speaking for ACA said, “The sale of Cornerstone Tower, shows that there is a market for properly developed assets that meet high-quality, international specifications.” Despite the challenges in Nigeria’s real estate market over recent years, it has become increasingly competitive and sophisticated, according to Nwogugu. “Our strategy is to invest in assets in optimal locations and to prepare them for discerning space users,” Nwogugu said, before adding that ACA “remains focused on asset differentiation and delivering good returns across our portfolio”. Ganiyu Musa, CEO Cornerstone Insurance Plc also expressed delight at the sale, “Our partners met and, in many instances, exceeded our expecta-

tions regarding cost, timeliness and quality. We were extremely pleased at the professionalism from conception to exit”. T h e B u y e r, E v e r t y shared a few comments on the sale “We’re pleased

to add Cornerstone Towers to our international real estate portfolio. Everty is committed to investing in assets that are at the cutting edge of design and sustainability; and our purchase of Cor-

nerstone Tower is testament to that. Nigeria is increasingly becoming an attractive countr y for companies to invest in, and buildings such as Cornerstone Towers reflect the am-

b i t i o n a n d i n n ovat i o n happening across the country.” With this exit, the Cornerstone Tower portfolio investment has delivered a gross USD IRR of 25.6% to CAPIC’s investors.

L-R: M. O. Apata, director, Apata Memorial High School; Ifejiofor Tochukwu, 1st runner-up, Intra-school phase of Lagos State Private School Spelling Bee Competition; Adebayo Precious, winner; Olalekan Toyosi, 2nd runner-up, and Njide Ken-Odogwu, manager, sponsorship and promotion, MTN Nigeria, at the 2nd batch of the Intra-school phase of the MTN mPulse sponsored Lagos State Private Schools Spelling Bee Competition at the Apata Memorial High School, Isolo, Lagos.

KPMG to help improve companies’ tax function as it launches ‘Tax Reimagined’ … as companies likely to fall prey of FG’s aggressive move for tax revenue DAVID IBIDAPO

igerian companies over the years have fallen prey of the whips of tax authorities due to defaults in tax payment, remittances falling short of tax authorities’ expectations etc. Tax experts have noted that tax payment and compliance despite mandatory according to the law is a complex system which has seen companies’ fault in their tax strategies and inefficient in undertaking their tax functions. To this end, KMPG Nigeria at a press conference on Thursday announced the launch of “Tax Reimagined” in Nigeria which is a new way for corporates to design and implement a strategy to manage their tax affairs in

the ever-changing landscape in the world of taxation. The solution was said to have been launched in South Africa and earlier this month, in Nairobi, Kenya. Dermot Gaffney, Africa head of tax reimagined said, “This is a service where KPMG facilitates the in-house tax functions of our corporate clients to reinvent their tax function, so they can focus on their key issues and risks to ensure their tax strategy is aligned with the overall business and finance strategy. “it is important that tax function is clearly able to articulate its mandate to the wider organisation and demonstrate the value they bring to the business,” he said. According to him, it is easy to measure tax in financial numbers but they don’t tell the entire story and

value proper management of tax within and organisation brings to that organisation, hence the holistic solution would help the tax function within any corporate entity to tell the story of tax. “if you get your tax wrong, authorities can easily close down your business, so you have to pay attention to the management of your tax function,” he said. Meanwhile in a fast changing and technology driven world, it is expedient that companies keep abreast and remain savvy in disruptions around the world especially in the area of taxation. “There are many global trends and disruptors that are placing increasing pressure on large organisations and the number of new technologies available to the tax function can be confusing,”

Ralf Bauer, KPMG Germany and EMA region Tax Reimagined solution architect explained further. With global tax reforms, tax authorities responding to increase their share in the revenue. This finally comes down to the tax department of companies as they need to supply accurate data and information in real time. “It is critical that the head of tax in any large group understands the range of solutions and sourcing options in the market and is able to identify which may be the best suited to his organisation’s need,” he said. From the Nigeria angle, there has been a lot of aggressiveness towards tax revenue, also evident in the recently presented 2020 budget as this threatens further companies that are inef-

ficient in their tax functions. “As we see the Nigerian economy is going and the gaps between government revenue and expenditure, tax as become more important as a source of bridging that gap, going forward, there will be more of it” Nike James, tax partner, KPMG Nigeria emphasised. “With Tax Reimagined, you are more assured that you are running your business in a very efficient manner, numbers generated for your tax liabilities are more accurate and ultimately your cost of compliance as an administration declines,” she explained. This initiative should see a ripple effect in improving government revenue and reduce penalties and cost imposed by tax authorities on inefficient companies in

the area of tax. Wole Obayomi, partner & head, tax, regulatory and people service said, “Corporates are facing many common issues in today’s fast changing world but the solutions needed to help them comply with their tax obligations in the different markets they operate in are unique to each client. “KPMG’s Tax Reimagined is a technology driven solution that is customised to each client’s particular circumstances and need.” While this solution would largely be beneficial to larger companies due to their complexity in operations, KPMG explained going forward it may look into creating a lighter version for small and medium scale companies in driving efficiency in tax functions.

Editor: LOLADE AKINMURELE (lolade.akinmurele@businessdayonline.com) Graphics: Samuel Iduh

Tuesday 15 October 2019

BUSINESS DAY

COMPANIES&MARKETS

Business Event

Road safety gets boost as Guinness, UNITAR partner FRSC on enforcement, literacy GBEMI FAMINU

s governments around the world move to attain the United Nation’s goal of sustainable cities and communities, the Nigerian government has reinstated its determination to strategically collaborate with the organised private sector to deliver on efficient and safe motoring. It is estimated that these collaborations will reduce road accidents, injuries and death by 50 percent by 2020. These assurances were given during the renewal of the partnership agreement between Guinness Nigeria, the United Nations Institute for Training and Research (UNITAR) and the Federal Road Safety Corps (FRSC). Speaking at the occasion, Corps Marshall, Boboye Oyeyemi, restated the Corps’ commitment towards ensuring safer roads at all times, particularly with knowledge gained from the High Visibility Enforcement (HVE) training. “We are very committed to improving road safety in Nigeria all year round. Our officers are very excited at the training opportunities provided by this partnership. Renewing this partnership

with Diageo and UNITAR is a step in the right direction and we are providing necessary measures, structures and policies to ensure that the partnership achieves its set objectives,” Boboye said. In his remark, Baker Magunda, CEO, Guinness Nigeria, applauded the efforts of the Federal Government and the FRSC promising that Guinness Nigeria would not relent in its effort at providing viable opportunities for engagement with relevant stakeholders to drive home the message of safety on our roads and reducing the number of road traffic injuries and fatalities related to drinking and driving. “Guinness Nigeria is proud of the partnership with UNITAR and FRSC. We have made some progress with regards to improving road safety in Nigeria. However, we are still intensifying motoring literacy to achieve the goal of sustainable cities and communities. Part of our intervention and commitment in support of the efforts of the government include providing education on the misuse and responsible consumption of alcohol while we also advocate for effective policies, programmes and partnerships with relevant stakeholders in this regard.

This intervention also cuts across other countries and in Nigeria we are steadily working on this in partnership with the Federal Road Safety Corps (FRSC). Commenting on the partnership, the Lead, Road Safety Global Initiative at the United Nations Institute for Training and Research (UNITAR), Ms. Estrella Merlos, commended the vision of both Guinness Nigeria and the FRSC, which aptly aligns with the 2030 projection of the United Nations on sustainable cities and communities to save lives. The two-day HVE workshop involved practical checkpoint exercises and use of breathalysers. The participants also discussed solutions and shared best practices on road safety legislation and regulation, road and transport infrastructure, as well as pedestrian responsibility and leadership. Guinness Nigeria also donated two additional breathalysers to the FRSC. Diageo, known in Nigeria as Guinness Nigeria Plc, and UNITAR have partnered to deliver the HVE programme to five cities over three years and practical trainings and learning events have also taken place in South Africa, Mexico and Dominican Republic.

L-R: Laurent Damiems, director of CNIEL; Anthony Alkosseifi, GM, Delifrost Caterers Nigeria Limited; Najib Khatib, managing partner, Delifrost Caterers Nigeria Limited; Christian Boto Abegan, culinary expert; Pierre Gray, master of Cheese in France; Christophe Spotti, communications manager, CNIEL, and Hassan Sefrioui, client services director, Sopexa Africa, at the launch of the first edition of AfroGourmands in Lagos.

L-R: Opeyemi Awojobi, sponsorship manager, Tolaram Group; Cinthia Afuzy, a contestant representing Adamawa State; Ben Murray Bruce, chairman Silverbird Group; Guy Murray Bruce, director, Silverbird Group, and Omotayo Azeez-Abiodun, public relations manager, Tolaram Group, at the crowning and cheque presentation to Miss Lush at the MBGN 2019 in Bayelsa.

Credit Direct rewards customers, staff at Customer Service Week SEGUN ADAMS

redit Direct Limited (a member of FCMB Group plc) joined the rest of the world to celebrate and reward their customers and staff at this year’s Customer Service Week. The customer service week is celebrated annually during the first full week in the month of October, and this year’s celebration spans from October 7 – 11, 2019. The essence of the week-long celebration is to appreciate the importance of customer service and of the people who serve and support customers daily. This informed the theme of the celebration for this year “The Magic of Service.” Every outlet of the company across Nigeria is engaged in various activities to make the week more colourful and remarkable. The line-up of activities for this year’s customer service week included: Colleague

Appreciation Day, a day to appreciate colleagues for their continued support ; Moments with the MD, during which the managing director, Akinwande Ademosu, called to appreciate outstanding customers and staff; Community Engagement Projects, various corporate social responsibility initiatives were execute (Renovating 25 schools in Nigeria, providing seats and study materials to schools, providing pipe borne water to communities, etc) aimed at enhancing the well-being of their host communities; free medical checks will be extended to civil servants in selected locations across the country during which medical professionals will provide consultation and dispense drugs to them; The week will be rounded off with a Costume Day; a day for all staff to represent any tribe they choose by wearing a cultural dress. This is done to appreciate Nigeria’s rich diversity and promote unity

amongst staff. To flag off the week, Ademosu expressed his gratitude to staff for their works and commitment, and charged them to be deliberate about delivering excellent services at every duty and task towards customers and their colleagues. He also promised to ensure that Credit Direct will always provide the right environment to foster service and excellence. Commenting on the customer service week, the Divisional Head, Customer Experience & Corporate Communications, Credit Direct Limited, Achia Tor-Agbidye said, “Credit Direct is always committed to offering excellent services to our customers, both old and new. We are using this medium to appreciate and reward our customers for their continued support and preference for Credit Direct services and our customer service teams for their commendable work all year round.”

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L-R: Charles Nnochiri, head of marketing, PZ Cussons Consumer SBU, PZ Cussons Nigeria Plc; Abiola Laseinde, head, corporate services (Africa), PZ Cussons Plc; Leo DaSilva, Premier Cool Campaign ambassador; Juliet Ibrahim, Global Handwashing Day 2019 Campaign ambassador; Dipo Dawodu, finance director, PZ Cussons Consumer SBU, PZ Cussons Nigeria Plc, and Yosola Nwachukwu, assistant brand development & activation manager, Personal Care; during the activities marking the Global Handwashing Day 2019 at Dansol High School, Lagos.

L-R: Abiona Babarinde, general manager, marketing and corporate communications, Coscharis Group; Christian Chigbundu, MD, Coscharis Mobility (SIXT), and Hyginus Omeje, sector commander, FRSC Lagos, at the media briefing to announce the Coscharis Mobility driving Academy in Lagos. Pic by Olawale Amoo

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Tuesday 15 October 2019

BUSINESS DAY

Investments

ENERGY INTELLIGENCE

Market Insight Companies Commodity Tracker Policy

OIL

GAS

PETROCHEMICALS

POWER

INNOVATION

Nigeria’s Indorama Eleme Petrochemicals leverages GE technology to boost power output STEPHEN ONYEKWELU

ompanies operating in Nigeria have resorted to generating own power given the lack of reliable, regular electricity supply from the national grid. This is why Nigeria’s Indorama Eleme Petrochemicals Limited is leveraging on General Electric Power’s technology to fire its plants. The petrochemicals company has successfully executed GE’s 6B Performance Improvement Package (PIP) upgrade on the first two out of six 6B gas turbines at the petrochemical facility in Eleme, Rivers State.

A gas turbine is a combustion engine that can convert natural gas or other liquid fuels to mechanical energy. This energy then drives a generator that produces electrical energy. It is electrical energy that moves along power lines to homes and businesses. The Eleme upgrade increased Indorama’s plant output by 15 percent per gas turbine, more than doubling the expected increase of 6 percent. The upgrade will help extend the interval for combustion and hot gas path inspections, reducing overall maintenance costs. In addition, this project is expected to increase power plant availability of up to 3,960 hours over 16 years.

“The growth in production is directly proportional to an increase in power needs and operational costs”, said a senior management official of Indorama Group of Companies. “Due to growing power demand in Nigeria, our objective is to expand our production. GE’s technology will help us mitigate costs while ensuring there is enough power to support increased production at a lower cost.” At Indorama’s Eleme plant, GE successfully installed the technology upgrade. The turbines achieved an increased output of 5 megawatts (MW) per unit, exceeding the expected benefits of 2.5 MW. In addition, combustion and hot gas path (HGP) inspections which were

Future Energy Nigeria gets Power Ministry’s endorsement

rganisers of the Future Energy Nigeria say the event has received the endorsement of Nigeria’s Federal Ministry of Power, an indication that the ministry is committed to seeing the project succeed. In its 16th edition, the Future Energy Nigeria which holds November 12 and 13, in Lagos, provides an opportunity for high level discussion on how to solve critical issues affecting the power sector which sees over 70 million without energy access in Africa’s biggest economy. The endorsement was delivered by Louis Edozien, the permanent secretary in the Federal Ministry of Power through an official letter to the organisers. “The Ministry is proud to be in partnership with the successful hosting of this year’s event,” he said. “The success of the last conference has given the Ministry the confidence to accord the upcoming event the necessary support that will avail stakeholders the opportunity to appreciate the gain recorded in the country’s power sector.” Acknowledging the support, Ade Yesufu, business development director, Future Energy Nigeria’s, said the Ministry’s written endorsement valued and an important stimulus. “We are proud to be the only event of its kind in Nigeria to receive official endorsement from the Federal Ministry of Power.” The event organisers have also confirmed that the Transmis-

separately carried out at 12,000 hours and 24,000 hours respectively will both take place at 32, 000 hours. Over 16 years, this new schedule will save Indorama the cost of carrying out 21 separate combustion and four HGP inspections and adding 3,960 hours of production. “At GE, we’re always focused on understanding our customers’ needs so we can tailor the right innovative solutions to increase the power plant’s operational performance and profitability,” said Elisee Sezan, CEO for GE’s Gas Power businesses in Sub-Saharan Africa. “In 2009, GE launched the 6B Performance Improvement Package, featuring advances in materials, coatings, sealing

POLICY

Big oil may take FG to court over claims of $62bn unremitted profits DIPO OLADEHINDE

I sion Company of Nigeria (TCN) will be an official supporting utility of the event. The upcoming event at Eko Hotels, Lagos will present solutions for the power sector and connect power and energy professionals working together to advance a sustainable energy economy. “Nigerians are taking ownership of the power deficit and are taking charge of their energy future” Yesufu said; “we are looking forward to bringing together all the stakeholders across the entire power sector value chain.” The organisers say leading industry partners and suppliers Jubaili Bros and Greenville LNG have been confirmed and returning as gold and silver sponsors respectively. The exhibition is expected to feature over 70 leading www.businessday.ng

global and local technology and services providers for the power and energy industry, including country pavilions from South Africa and India. According to the release, “This year’s Future Energy Nigeria further offers the unique opportunity again to go behind the scenes at a thermal power plant as part of a technical site visit tour at the Egbin Power Plant. “An affiliate of the indigenous energy conglomerate, the Sahara Group, the company operates one of the largest thermal power plants in sub-Saharan Africa and contributes over 10 percent of the total electricity generated to the Nigerian national grid. This makes it the heartbeat of power and the largest provider of electricity to Africa’s largest economy.

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and aerodynamics derived from its F-class technology to increase output and efficiency.” Sezan said that GE’s continued investments in upgrades for mature fleets are helping power producers and industrial operators, such as Indorama, remain competitive in today’s dynamic marketplace. Today, PIP is installed on over 200 units globally, and it has become the standard configuration for new 6B gas turbines. GE has been operating in Nigeria for over 40 years, with more than 750 employees, 90 percent of who are Nigerians. The company has businesses spanning across key sectors including oil and gas, power, healthcare and renewables.

nternational Oil Companies (IOCs) also called big oil (companies) operating in Nigeria may be considering legal options available to them after federal government announced plans to recover as much as $62 billion due to unchanged 26 year old Production-Sharing Contracts (PSC) laws that has hurt Africa’s biggest oil-producing country, analysts say. “The IOCs will definitely go to court for arbitration, which will drag for a long time. The Federal Government cannot blame the oil companies for exploiting a weakness in Nigeria’s legislative structure,” Ademola Henry, team leader at the Facility for Oil Sector Transformation (FOSTER), told BusinessDay. Bamidele Odugbesan, media relations manager of Shell Nigeria, one of the major IOCs affected told BusinessDay that Shell does not agree with the legal basis for the claim that it owed outstanding revenues and the matter is pending before the court. In Nigeria, PSCs are used on over 70 blocks, which were signed with IOCs and independents, such as Addax, Shell, ExxonMobil, Total and Chevron, several national oil companies including CNODC, KNOC and Statoil, and a number of indigenous companies. According to the Natural Resource Governance Institute (NRGI), Nigeria has lost an estimated $60 billion in royalty payments and nearly $2 billion in extra government revenue due to the non-implementation of the 1993 Production Sharing Contract (PSC) provisions that permit royalty payments according to the Deep Offshore Act. Early this Month, Nigeria’s Senate took the first reading of the bill to amend the Production Sharing Contract (PSC) Act of 1993 as lawmakers emphasised the need to review the bill in order to @Businessdayng

enhance earnings for Nigeria. Ifeanyi Ubah, senator representing Anambra South said the non-review and amendment of the PSC Act had cost the federal government about $21 billion (about N7 trillion) in the last 20 years. “Nigeria, haven lost trillions of naira due to non-review of the PSA Act, stands to gain an additional sum above N30 billion naira monthly if the Act is reviewed and amended,” Ubah said at the upper chamber meeting last week. Also, George Sekibo, senator representing Rivers East frowned upon the attitude of the executive, the operators of the law, saying it was agreed that the sharing formula be reviewed when the price of crude oil moved to $20. Latest Nigeria National Petroleum Corporation (NNPC) financials showed PSCs had the highest production with 45.40 percent over the three year period while Joint Ventures (JVs) came second with 28.99 percent, Alternative Financing (AFs) had the third highest production with 10.77 percent, Nigerian Petroleum Development Company (NPDC), the upstream company owned 100 percent by NNPC, had the fourth highest with 8.12 percent production while Marginal Fields (Independents) had the lowest production contributing just 6.71 percent to total production. Under the PSC arrangement, the contracted company does not own any petroleum until it is taken out of the ground. Royalties and certain taxes are then paid, after which the company is allowed to recoup certain costs in oil. The remaining production is then shared between the company and Nigeria National Petroleum Corporation (NNPC) on the basis of an agreed production share. The government, however, now wants to get the oil companies to honour the long-standing contract and remit funds that have gone unremitted since crude crossed the $20 per barrel mark.

Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINESS DAY

ENERGY INTELLIGENCE Analysis

Schneider Electric is turning innovation into an art form As a global specialist in energy management and automation in more than 100 countries, Schneider Electric is unveiling next-generation integrated energy solutions across multiple market segments, ISAAC ANYAOGU attended the company’s Innovation Lagos event and reports that the French company looks like it wants to even innovate how we imagine.

magine waking up on a cold morning and the air conditioner knows to warm your bedroom. Your coffee maker prepares your coffee - cream and no sugar. Your bedroom senses your need for more light and gently parts the curtain. Sinatra seeps from the ceiling and your bathroom serves you hot water following prompts on your smart phone. Dressed, you step into your living room just as the lights come on. At the door, an alert chime on your phone warning you to avoid the Third Mainland Bridge because the traffic today seems like it’s nursing a grudge. Midway into your journey, you’re not sure you closed the kitchen door. You share this concern with Alexa and in seconds, the door is securely locked! While this may look like an overactive imagination, the folks at Schneider Electric already have an app for them. It is not just enough that houses be smart, the company believes they must be wiser. Imagine your smart phone regulating your room temperature or a factory’s central cooling systems warning the facility manager it is due for service. This is how Schneider Electric understands Life, turned On. “We are innovating for the future,” says Christophe Begat, managing director of Schneider Electric in remarks kicking off the company’s Innovation Day Lagos which held on October 10, 2019 and featured expert learning sessions around issues including cybersecurity, end-to-end traceability for consumer-packaged goods and even smart, self-healing grids for electric utilities. Schneider Electric seeks to power and digitise the economy to keep the world energised, efficient and connected. Already, the Internet of Things is reshaping how we live as devices have become more connected than any time in human history. In many homes today, smart phones and tablets serve us through voice assistants like Alexa and Google Assistant. Some homes have motorised blinds, smart entertainment systems, smart fridges and coffee makers, IP cameras and smart locks on doors. Devices have become so smart; it seems we are playing catch-up. An enabler of this connected world is advances in digital technology, a field Schneider Electric leads. The number of connected devices worldwide now exceeds 17 billion, with the number of IoT devices at 7 billion and this does not include smart phones, laptops or fixed line phones. “The transformation the world has seen in the last 20 years, is far more than what the world saw 200 years preceding the last 20 years all because of tech innovation,” said Temitope Fasoranti, executive director at Zenith Bank who shared how

L-R: Albert Fuchet, Cluster President, Anglophone Africa, Schneider Electric; Christophe Begat, Managing Director, Anglophone West Africa, Schneider Electric, Alhaji Bola Azeez, CEO, Bolamark Engineering Limited, Mojola Ola, Head, Building Business, Anglophone West Africa, Schneider Electric; Nurudeen Oyedeji, Channel Manager, Anglophone West Africa; Ifeanyi Odoh, Head, Offer Marketing and Business Development, Anglophone West Africa, Schneider Electric at Innovation Day Lagos, October 10, 2019.

innovating around smarter energy systems using Schneider Electric’s products helped save the bank 60 percent in energy costs. Albert Fuchet, Schneider Electric cluster president, Anglophone Africa in his keynote address, said the company sees every problem encountered by society as an opportunity for innovation. Fuchet however, warned that the way we live now is not sustainable. “If we don’t do anything, experts are telling us that global temperatures will rise between 3 and 4 degrees which will mean more environmental disasters, more migration and catastrophe and in a city like Lagos, we don’t want to think about the implications.” Human activity is responsible for carbon emission which in turn leads to rise in global temperatures. While, energy consumption is rising, over 2 billion people are without access to energy, yet over 60 percent of the energy used today is lost due to inefficient use, Fuchet said. “Schneider as a global company is addressing this challenge with stakeholders working on the climate challenge,” Fuchet said. In the last United Nations Climate talks, 87 global companies pledged to decrease their carbon emission but according to Fuchet, this is not a new goal at Schneider Electric. “We have been working for years on this, but officially we are committed to achieving net zero emission by 2030.” To beat back the threat of climate change, he suggested we save, electrify and decarbonise. Between 30 and 50 percent energy can be saved by making buildings more efficient and generating electricity where it is used. Electricity from renewable www.businessday.ng

energy sources including wind and solar can cut carbon emissions by 60% in the next 20 years Fuchet said. The disruptive technologies of the digital economy are challenging companies to think and act differently. “We are helping businesses and individuals unlock opportunities and make the most of this digital revolution across all market spheres,” Begat told journalists. Schneider Electric’s digital magic wand - EcoStruxure At the heart of Schneider Electric’s innovation is its EcoStruxure an open, interoperable, IoT-enabled system architecture and platform. It leverages advancements in IoT, mobility, sensing, cloud, analytics and cybersecurity to deliver innovation at every level. Developed in 500,000 sites with support of over 20,000 developers, 650,000 service providers and partners, in 3,000 utilities and connects over 2 million assets under management, the EcoStruxure architecture is serving four end markets including building, data center, industry and infrastructure. Re-invented buildings EcoStruxure for buildings is enabling sustainable design and active energy management in buildings. It is used in over 1million buildings including at the Hilton Worldwide and the Malaysian prime minister’s office. Buildings today have evolved beyond bricks and cement, they are now smarter. Fady Morgan, digital energy business development director, International Operations for Schneider Electric in his presentation said key trends that will shape the industry include urbanisation, digitisation and energy consumption.

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Morgan said Nigeria’s projected urbanisation rate is put at 3 percent which translates to over 6 million people leaving villages for large cities like Lagos. “But we are not building fast enough to meet this growth. So we need to change what we are doing.” Schneider Electric believes that buildings should provide personalised experience to all occupants. In re-invented buildings, artificial intelligence will deliver data insights and help building users and facility managers operate their asset much more efficiently by knowing life cycle of assets and when to repair or replace them. Buildings will evolve into generation assets with local renewables that limit carbon foot print. They will also be simplified across systems from design to operation, enabling faster and cost-effective installation through open systems and APIs. Digital transformation EcoStruxure is helping companies in their digital transformation. A representative from the Nigerian Liquefied Natural Gas (NLNG) said Schneider Electric helped it create a cohesive digital strategy. Irfan Yunus, vice president sales, process automation EMEA, said companies can make the most of their digital transformation first by thinking about easy ways to get started at their facility or for their machine. Then leverage their domain expertise and the ecosystem available to develop solutions across the IT/OT domains, bring power and process requirements together to find cross-efficiencies and support them with integrated software. Already 20 of the largest oil and gas companies and 10 of the world’s @Businessdayng

top electric utilities have employed EcoStruxure to aid their digital transformation. Data Centers In data centers, Remi Pouchuq, Secure Power Business Development Manager, MEA, said EcoStruxure architecture provides increased availability and improved efficiency and performance at each node. Digital transformation is helping businesses get ahead, hence today’s collective challenge is to provide end-to-end management and resiliency to increasingly complex distributed computing ecosystem, Pouchuq said. Schneider’s idea is to use cloudbased systems to mange hybrid IT environments. The process includes collecting and analysing massive amounts of data, remotely monitor and manage all of a company’s sites from a single device and connect with outside experts to remotely monitor and service, then scale management systems leading to achieving better performance with predictive capability through big data analytics to spot trends and forecast failures, EcoStruxure is helping them tackle complex IT and DC environments with Cloud-based management systems, big data analytics, mobile insights and optimized operations. Nigerian market Since energy demand outstrips supply in Nigeria, opportunities abound yet the economy has the world’s highest number of poor people, raising concerns for affordability. “We launched the Global Access to Energy programme to make sure that energy is available for everyone, everywhere at every moment. Whilst catering for energy integrity at the base level, we also have basic solutions for someone who simply wants to turn the lights on and off and for off-grid communities,” said Ifeanyi Odoh, head offer marketing at Schneider Electric. The company is also supporting training opportunities designed to re-skill electricians, partnering with local training institutions to train over 200 electricians. It equipped a JAMB center and supports some universities. It has provided 200 free modules and international certification of which over 1000 Nigerians have benefited. “When you look the solutions, you get a feeling it is high-end but we have major and minimum offer for all classes of customers, we are committed to bringing access to energy to a maximum number of people because we believe energy and digital are fundamental human rights,” said Begat. Viviane Mike-Eze communications manager at Schneider Electric said the inclusive nature of their service offering can be seen in that most installations in off-grid communities are powered by the company devices.

Tuesday 15 October 2019

BUSINESS DAY

OFFGRID BUSINESS Investment

UAE builds 300MW renewable energy plant in Lagos

300MW renewable energy power plant has been established and it is ready to generate power in Lagos soon. This was revealed when the United Arab Emirate Ambassador to Nigeria, Fahad Obaid Al Taffaq, paid a courtesy visit to the Minister of Power, Sale Mamman in his office on Tuesday. Mamman reiterated Federal Government’s openness to genuine investors especially in the power sector. He assured that the Ministry will collaborate with the United Arab Emirate in its areas of investments in Nigeria. The United Arab Emirate ambassador to Nigeria Fahad Obaid Al Taffaq informed the Minister that a 300 megawatt power plant established by the United Arab Emirate, UAE is ready for take-off in Lagos to supplement the National grid. Al Taffaq said the 300MW power plant established by a member of the Emirate Royal Family, Ahmed Al-maktum, has the capacity for expansion within a few months to about 1,000mw. He noted that the power project is part of the United Arab Emirate investment activities in Nigeria. The Ambassador however

requested the assistance of the Minister in securing a generation license and tariff from the Lagos

State Government. Al Taffaq explained that the company had concluded all agreements with

Nigerian entrepreneurs bag renewable energy award STEPHEN ONYEKWELU

irst WATT Renewables has emerged winners of the 4th West African Forum for Climate and Clean Energy Financing (WAFCCEF) contest, held recently in Abidjan and co-organised by the African Development Bank. Young Nigerian entrepreneurs, Sherisse Alexander and Oluwole Ewéje, presented the project. Based in Canada, First WATT Renewables runs its project through an ‘SPV’, or ‘Special Purpose Vehicle’ set up to isolate financial risk, with a ‘take-or-pay’ model, that is an indexed electricity-purchase agreement in dollars. Energy is provided as a service to the buyer, who makes flat-rate monthly payments. According to its initiators, the project eases the transition towards Another award-winning project, Sweep Ghana, transforms energy-rich waste, including 20 percent of Accra’s household waste, to produce 15 megawatts (MW) of electricity for the national grid. A third winning company, Dutch & Co, helps to bridge the gap between supply and demand for electricity in Africa. It reduces demand by installing low-energy LED lighting and increases supply using solar PV. “The candidates and their coaches had work to do. There

were projects at different stages of maturity. But for us, the question was this: Which project has the best chance of securing funding straight away? There were many really appealing projects, different types of technology in different countries, and we had to make a choice,” explained the jury as it delivered its verdict. Eight projects were submitted, from Côte d’Ivoire, Ghana, Togo, Cameroon and Nigeria. “WAFCCEF plays a crucial role in developing the next generation of clean energy entrepreneurs on the continent and serves as a link with investment initiatives by the African Development Bank and other financial institutions” said Daniel Schroth, acting director of the Bank’s renewable energy and energy efficiency department. “We have previously supported other WAFCCEF winners through the Sustainable Energy Fund for Africa (SEFA) and we hope to be able to select some additional projects for the Bank’s pipeline.” Launched in 2013 by the Private Financing Advisory Network (PFAN), the WAFCCEF contest is organised by a partnership of the African Development Bank, the ECOWAS Centre for Renewable Energy and Energy Efficiency, (ECREEE), the ECOWAS Bank for Investment and Development and the African Biofuel and Renewable Energy Company

Arab Emirate to invest in electricity transmission and distribution network across Nigeria.

Conference

(ABREC). The PFAN network consists of more than 150 experts in climate funding and clean energy from around the world. The programme is hosted by the United Nations Industrial Development Organization (UNIDO) and the Renewable Energy and Energy Efficiency Partnership (REEEP) in Vienna. It is also supported by the governments of Australia, Japan, Norway, Sweden and the USA, and by the Kigali Cooling Efficiency Program (K-CEP). “I was very impressed by the quality of the projects submitted. I was also pleased with the positive reactions of the investors attending the event, demonstrating the added value of the PFAN approach to the development and financing of clean energy and climate projects,” said Albert Boateng, PFAN coordinator for West Africa. The first WAFCCEF was won by the SMEFUNDS (‘Small and Medium Entrepreneurship Fundamentals – Green Energy & Biofuels’), a Nigerian start-up behind the first production installation for cooking fuels in the form of a bio-ethanol gel made from plant waste. In 2014, this company received a $580,000 grant from SEFA to finance technical studies, legal and financial advisory services and a full environmental and social impact assessment.

ANALYSTS: Isaac Anyaogu (Team Lead), Stephen Onyekwelu, Dipo Oladehinde

Shell for the supply of gas to the plant. He also informed the Minister of the interest of the United

Energy Institute set to host its annual energy sustainability conference

nergy Institute Nigeria, in partnership with the UK Department for International Trade (UK DIT) is set to hold this year’s edition of its annual Energy Sustainability Conference. The conference, scheduled to hold from 16th to 17th October 2019 at the Lagos Oriental Hotel presents a suitable platform for all stakeholders within the energy industry to discuss, share ideas, and make valuable recommendations that will enhance further growth and development of the sector. Under the theme “Energy Landscape: Minimizing Risks and Maximizing Opportunities”, this 2-day conference seeks to enable knowledge transfer, foster relations, and sharpen skills of participants through specialist hubs, breakfast sessions and various industry specific panel sessions. Speaking about the conference, the Chairman of Energy Institute Nigeria Osten Olorunsola said “The dual challenge of meeting the demand and the supply side of energy on one hand, as well as being environmentally responsible and sustainable on the other hand, simply means that industry practitioners have to devise a means of pulling in two opposite directions at the same time”. “This is the reason we gather all players across the energy spectrum to co-create solutions to global energy challenges” he added. Reiterating its undertaking to be Africa’s leading investor by 2022, Emma Wade-Smith, Her Majesty’s Trade Commissioner to Africa said: “Promoting the merits of Nigeria and the broader African continentasaneconomicpartner,means advancing one of the continent’s most

prosperous sectors to realize its optimal potential. Our priority is one of solving long-term issues, opportunities for sustainable development and shared prosperity. Earlier this year, we announced we would host an Africa Investment Summit in London; an event that will bring together businesses and governments to promote both the investment opportunities across Africa and the scale of the UK’s investment offer.” In June, the UK government became the first major economy in the world to pass laws to end its contribution to global warming by 2050 and advocates for new technology, innovation and best practices for greener, more sustainable energy. Tackling climate change whilst meeting the energy needs of a growing and developing economy is matter of urgency and this dual objective and partnership has a focus of bringing attention to the way we produce and consume energy long term British Deputy High Commissioner, HarrietThompsonandGovernorofOgun State, Dapo Abiodun, are both marked to beattheevent.Otherguestsinclude:Tony Attah (Managing Director, Nigeria LNG Limited), Ed Ubong (Managing Director, Shell Nigeria Gas), Soji Awogbade FEI (Principal Partner Aelex Legal Practice) , Layi Fatona (CEO, ND Western), Tunde Afolabi (Chairman, Amni International), AbdulrazaqIsa(Chairman,Waltersmith), Austin Avuru (CEO, Seplat Petroluem), Charles Odita (CEO, Midwestern), Joy Ogaji (Executive Secretary, Association of Power Generation Companies), Yomi Awobokun (Managing Director, Enyo Retail & Supply) and many more.

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email: isaac.anyaogu@businessday.ng, stephen.onyekwelu@businessdayonline.com, oladehinde.oladipo@businessdayonline.com

Tuesday 15 October 2019

BUSINESS DAY

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

Higher

Human Capital

Sex for grades: FCCPC condemns sexual harassment on campuses

WAEC gets change in leadership as Bah becomes Registrar

...Calls for holistic approach to eradicate menace

he West African Examinations Council (WAEC) has announced the appointment of Pateh Bah, from The Gambia, as its new registrar/ CEO. Bah succeeds Iyi Uwadiae from Nigeria and will serve for a five-year tenure - October 2019 to September 2024. Bah until his appointment as the registrar served as the head of Gambia National Office. In a statement made available to BusinessDay, Abiodun Aduloju, director, public affairs of WAEC, says Bah has made appreciable contribution to the development of education, adding that he was a member of the Governing Boards of the Gambia Technical Training Institute and the Gambia National Accreditation and Quality Assurance Authority. According to the statement, “His appointment to the position of Registrar was ratified by Council – the International

HARRISON EDEH, Abuja

gainst the backdrop of recent revelation by a BBC undercover reporter, who exposed lecturers who sexually abused students at the University of Lagos, in what is now referred to as “sexfor-grades” acts, the Federal Competition and Consumer Protection Commission (FCCPC) has condemned in strong terms the sexual harassment and other forms of exploitation in institutions of learning across the country. The commission said students, as consumers of educational services, are entitled to safe, secure and liberal educational environments where the relationship between faculty and students promotes confidence and robust knowledge sharing. Babatunde Irukera, director general, FCCPC, said it has consistently taken and urged relevant authorities to take necessary action in response to allegations of inappropriate conduct by lecturers. Irukera in a statement said on April 30, 2018, it requested authorities of the Obafemi Awolowo University (OAU) to act both swiftly and decisively regarding an allegation of sexual misconduct against a member of faculty that emerged after a student

cried out. It noted that it has remained in communication with OAU to ensure the investigative and disciplinary process was both transparent and timely. “OAU ultimately disciplined the member of faculty in a decisive manner. On June 21, 2018, the Commission welcomed and commended OAU’s action. “On October 6, 2019 the Commission again applauded Ahmadu Bello University (ABU) for its unprecedented bold and resolute action in disciplining 15 employees for sexual misconduct, and conduct bordering on corruption. “Subsequent to, and perhaps contemporaneous with these actions, the British

Broadcasting Corporation (BBC) was apparently journalistically investigating institutions in West Africa in a Sex For Grades menace. “This investigation has led to swift and commendable responses by the University of Lagos authorities, specifically the suspension of the implicated lecturers and the closure of the “cold room”. The open disclosures and naming by victims and others of possible violators across the country underscores what is essentially a problem of rampant proportions. This conduct is not limited to the identified in this statement. We strongly urge others to take decisive and transparent action as well as limiting en-

abling fora for such conduct in their school communities,” the commission said. The commission called for strong, collaborative and coordinated action and a robust policy framework to address sex for grades acts either from the students or lecturers. It asserted that the absence of collaboration among various stakeholders has “severely undermined the educational process and created a cloud of questionability over educational outcomes. Whether as a willing participant, a victim, or an unsolicited student, this insidious practice compromises all and undermines the validity of degrees obtained, or failures/delays in graduating.

etermined to empower female students across selected schools in Lagos state, Laterna Ventures Limited, leading book sales and Distribution Company has partnered with Ladies Helpline Initiative, (LHI) to host the Young Girls Summit 2019. The event is part of programme designed in commemoration of the international day of the girl child which is observed annually be the United Nations. Robert Lawson, assistant general manager, Laterna Ventures Limited while speaking during the Young Girls Summit 2019 in Lagos, said “This is a day set

Governing Board of WAEC - at its 67th annual meeting held in Freetown, Sierra Leone, in March 2019. Bah is a graduate of Pune University, Maharashtra, India from where he obtained a Bachelor of Commerce degree in 1997. He also holds various postgraduate and professional qualifications from other institutions in India and the UK. “Bah worked briefly with the Ministry of Education, Youth, Sports and Culture, Banjul, The Gambia from 1990 to 1991 before he joined the service of WAEC at its Gambia National Office on October 9, 1991. In 2002, he was appointed as Personal Assistant to the Registrar/CEO and he consequently, relocated to the Council’s Headquarters in Accra, Ghana. While at the Headquarters, he rose to the position of Principal Assistant Registrar on April 1, 2010. He diligently and successfully served as Personal Assistant to two successive Registrars”, the statement.

St Anne’s School Old girls mark 150 years of Alma mata KELECHI EWUZIE

O L-R: Ipoola Alani Akinrinade, third to the left, Chairman of the occasion; Akin Ogunbiyi, group chairman, Mutual Benefit Group and founder, The Akin Ogunbiyi Foundation; Wife, Adedotun; Michael Faborode, former Vice Chancellor, Obafemi Awolowo University, Ife and other panelists at the unveiling of the Akin Ogunbiyi Foundation and the maiden lecture series held in Osogbo.

Laterna, LHI partner to empower female students across schools in Lagos KELECHI EWUZIE

KELECHI EWUZIE

aside by the United Nations to highlight the needs and challenges faced by the girl child and to call attention of the need to empower the girl child to allow them aspire to equal right in the society. “The girl child can be powerful agents of change within her family and so enough of all those prejudices and abuses that they have been subjected to. We thank God for some advocacy groups that have come up, one of which is the LHI. “This year we are partnering with LHI to celebrate this day and we are focusing this year on ‘Harnessing the Winning Creativity of the Girl Child.’ The girl child has talents and skills, so she has the right to express them positively. She has a right to express her voice. She should www.businessday.ng

not be seen subjected to the kind of abuses that we have witnessed in our society, even in our tertiary institutions,” Lawson said. He mentioned that some of the activities to mark the event are tour of the facility; girls talk and question time; and panel session of female authors who will share their real life experiences. Lawson stated that there is also emphasis on inculcating the habit of reading, adding that rather than using the cell phones for questionable things, this same tool can be channelled to much more positive uses. Also speaking at the event, Nnaji Ugbaja, head of corporate affairs unit, Laterna Ventures Limited said the selection of the schools that participated in the event was

a mix of private and public schools. “Generally, schools don’t like their students to travel to far distance. So, we decided to use schools within this vicinity. The public schools have to get authorisation from the local education district before they are permitted to come. All together, we invited five schools. We have over 40 students participating. “This year, we decided to partner with LHI, which is at the fore front of promoting issues surrounding the girl child. The convener of the event Izehi Hannah Agunkejoye is an author who has a book which we sell at Laterna and we decided to work with her,” Ugbaja said. He assured that Laterna Ventures will be doing much more than this in the future.

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ld girls of St Anne’s School, Ibadan have rolled out programmes as part of activities to commemorate the 150 years anniversary of the school. At a press briefing organised in Lagos, Funmilayo Soleye, chairperson of the 150 years anniversary committee, said the anniversary is the high point of the old girls celebration every year adding that it serves as a reminder of the status and history behind the school. St. Anne’s School can be said to be the forerunner of all girls’ school in this part of Nigeria as it is the first School in Nigeria to offer formal education to the girl child. Its history is traced back to the establishment of the CMS Girls Institution in Lagos in 1869 and Kudeti Girls School, Ibadan in 1899. It is the merger of these two schools in 1950 that produced St Anne’s School, Molete, Ibadan. Soleye observes that over the years, the old girls from different sets have been carrying out several projects in the school, adding that 150th anniversary represents the first time the old girls will be coming together as one body to celebrate and inaugurate the legacy projects. Speaking on the 150th anniversary theme: ‘The trials and successes of the girl-child education in Nigeria: The St. Anne’s @Businessdayng

Story’, Soleye said the anniversary scheduled for 17th to 19th October in Ibadan would serve as an avenue to honour past and present principals and to commission projects by old students in the school. Adenike Adeshina, member of the committee in charge of finance and funding while speaking on the challenges faced by the school currently urged state governments to return missionary schools to the owners willing to take their schools back. According Adeshina, “The government has the mandate to provide quality education for its populace, but it should not stop the private sector. For the schools that have been set up by the missionaries, if they are ready to take the schools back the government should release the schools to them” “The government can carry their share of the burden but they should allow the missionaries who founded the schools to do same if they wish to. The government can provide a regulatory framework to ensure the standards of education are kept,” Bisola Ariyibi, in charge of media and publicity committee of the 150th anniversary recalled that “St. Anne’s in those days had people from the north, south, east and outside Nigeria. “The school also had Cameroonians who came to our school and we learned to live with one another, the question was not where did you come from?” Ariyibi said.

Tuesday 15 October 2019

BUSINESS DAY

EDUCATION ‘Private sector investment in infrastructure key for manpower development’ … As NB donates education facilities to school in Abuja KELECHI EWUZIE

he Federal Government of Niger ia says the continuous investment by private sector in educational infrastructure represents the needed resolve to ensure the development of skilled manpower in Nigeria. Adamu Adamu, Minister of Education while speaking when an ultra-modern block of classrooms, library and toilet facilities was donated to Government Day Secondary School, Karu, Abuja by the Nigerian Breweries organisers of the of the prestigious Maltina Teacher of the Year initiative - a brainchild of the Nigerian Breweries/ Felix Ohiwerei Education Trust Fund, commended the company for its commitment to the development of education. Adamu Adamu who was represented at the occasion

by Lami Amodu, director, Basic and Secondary Education expressed his delight at commissioning the model block of six classrooms in honour of Olasunkanmi Opeifa. According to him, “The company has been at the

forefront of improving the educational sector by continually investing in educational infrastructure, encouraging teachers and students in the country. With initiatives such as the Maltina Teacher of the year and, the

various school intervention programmes, the story of the development of Education in Nigeria cannot be complete without Nigerian Breweries”. The construction of the facilities in the school is part of the prize won by Opeifa

Linda Olumese, Principal, Anike -AdeTreasure, Vincent and wonderful pupils of CALEB British International School, Abijo displaying different tribes and culture in unity for Nigeria’s 59th Independence celebration.

Olasunkanmi for emerging as the 2018 Maltina Teacher of the Year. He also got One million Five Hundred Thousand Naira cash prize, a capacity development programme plus another One million Naira to be paid to him annually for five years. Jordi Borrut Bel, managing director, Nigerian Breweries Plc., explained that the gesture embarked upon by the company is in line with its commitment to Winning with Nigeria and also part of the its contribution to the advancement of education in Nigeria through the Maltina Teacher of the Year initiative. Bel who was represented by Vivian Ikem, head, Government Relations, Nigerian Breweries Plc. Says the Maltina Teacher of the Year initiative is hinged on a realisation that teachers hardly get the recognition they deserve in spite of the pivotal role they play in determining the quality of our education

and the future of our country, Bel stated that the idea of the school-based project was to ensure that when a teacher wins, his community also benefits. In her remarks, the principal of the school, Funmilayo Kayode expressed great appreciation to Nigerian Breweries for what she described as a historic moment, not just for the school but Karu Community and the nation as a whole. “This goes to show that there is hope for education in our country. The Maltina Teacher of the Year initiative has greatly changed the course of history for teachers and schools in the country.” She said. Delivering the vote of thanks, the 2018 Maltina Teacher of the Year, Olasunkanmi Opeifa charged teachers to rededicate themselves to the profession noting that teachers’ rewards are no longer to be enjoyed in heaven but rather while they are alive.

Corona stirs up healthy lifestyles culture among students, parents

Greensprings School out to change Xenophobia narrative for future leaders

… Launches new fitness centre

KELECHI EWUZIE

earning to imbibe the culture of healthy lifestyles by eating healthy diets, observing regular exercises and going for regular medical checkups will no doubt give a child an edge among his peers. It was with this in mind that Corona Secondary School (CSS), Agbara, Ogun State organised the maiden edition of its ‘Health and Fitness Week. The event is part of the efforts of the school to ensure that they promote the culture of healthy living for students and parents alike as this will further assist to raise the next generation of healthy citizens. The week-long event had both internal and external fitness trainers taking participants through a set of routine aerobic exercises on the open field of the school, before sunrise, on each of the days. Chinedum Oluwadamilola, Principal, Corona Secondary school , Agbara Ogun State said, Health is paramount adding that as a school, they always want children to do well in their examinations, as well as for them to grow up as responsible adult in a healthy body.

Oluwadamilola observes that exercise and fitness have been known to pump oxygen into the brain so that brain cells can function very well, and it is also good to start having healthy feeding habits, regular exercise, very early in life. While speaking at the Health and Fitness Week, Oluwadamilola stated that there is no better way to start it than in school. According to her, “This shouldn’t be confused with sports, because it is not about sports, it is just to exercise the body, and that is important to us. As you know, a healthy body would beget a healthy

mind. Academics have to do with the mind, and if the body is weak, sluggish, deceased in some cases, a child isn’t going to be able to do anything. Speaking on the importance of exercise, Oluwadamilola said a habit of exercise on a daily basis would improve sleep which is proven by research, and that would transform to the child’s brain, by making him able to assimilate properly and being at alert. The principal further said that this exercise, though the maiden edition for the school would henceforth be held every term and will be incorporated in all the three terms. She advised parents to

L-R: Olusola Falodun, chairman, Parents Teacher Association (PTA), Corona Secondary School; Chinedum Oluwadamilola, principal, Corona Secondary School, Agbara; Tenny Egwuatu, PTA Vice-Chairman and Paul Obah, vice-principal (Academics) at the launch of a new fitness center for staffs and teachers of Corona Secondary School Agbara, during the ‘Health and Fitness Week’ held at the school premises www.businessday.ng

integrate it as part of their children’s’ route outside the school premises. Afonume Okwe, guest speaker of the occasion said the essence of the week was to make the children, parents and staff imbibe the culture and the lifestyle of staying fit and healthy. According to her, “We are trying to raise health awareness, and of cause make the children imbibe the culture and the lifestyle of staying fit and healthy. That is being transmitted to the parents as well because, when you catch the parents, they would ensure propel their children to as well be health conscious. At the official launch of the teachers and staff fitness center, Olusola Falodun the Parents Teachers Association Chairman, CSS Agbara, said the gym center was necessitated to encourage teachers and staff of the school embrace the fact that living healthy should be a way of life. “We feel that, healthy living, of which exercising is part of is important in the life of every individual. So this is a project that the PTA supported immensely in terms of financial contribution, and we are glad that it has now been commissioned”, Falodun said.

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s part of its contribution to change the negative Xenophobia narrative among the next generation of leaders, Greensprings School, Lagos recently organised a National Day with the theme Xenophobia: A Cry for Unity. The programme which was organised to mark the 59th Nigeria’s independence anniversary also provided an opportunity to create awareness among the students about the effects of xenophobia and the need to maintain a peaceful relationship with people from other tribes, religion, cultures, as well as with the international community. Ba r n e y Wi l s o n , d e p uty director of Education, Greensprings School, said the school decided to focus on xenophobia, which is plaguing not only Africa, but the whole world. Wilson said the school is using the event to challenge students to be independent in their thoughts; to be respectful of their answers; to chart a new way so that the economies can come together so that we can benefit from the love that we have for each other “Xenophobia is really ignorance; making assumptions about people based on what one has been told, @Businessdayng

adding that as tomorrow’s leaders, students don’t have to hold on to their opinions about other tribes and countries based on what they were told”, Wilson said. Wilson further said as Nigeria celebrates her independence, “We want the community to know that Greensprings School is saying one Africa, unity, love each other, don’t make assumptions, come together, spend time with each other and learn to respect each other.” He said the school expects the students to be better leaders tomorrow than the existing leaders today. Some of the parents that spoke with journalists said the annual national day helps the students to be aware about their country and when they participate in activities like dance and drama, they get to understand the culture of Nigeria. They added that with this year’s theme of xenophobia, the students are more aware of what it is and how not to participate in xenophobia and the best behaviour they should put up as Nigerians. Highlights of the day saw parents bring their indigenous food and drinks, which were displayed so that students and other guests will have the opportunity to eat food from other tribes and savour the diversity of the country.

Tuesday 15 October 2019

BUSINESS DAY

#SexForGrades and our obsession with credentials

s I watched the BBC Africa hidden camera footage showing university lecturers abuse their power, it confirmed to me what I already know: employers place too much emphasis on university degrees and grades and it is hurting the continent. Our educationto-employment system is so broken that some lecturers take advantage of the desperation of young people to possess a tertiary degree for fear they will be blocked out of the formal economy for the rest of their lives. Over ninety percent of formal entry-level jobs in Nigeria require these elusive degrees that are no prediction of competencies, especially in light of what we all know - which is that too often, these grades are distorted by coercion/control. Given this reality, it has become a “do or die” affair to get a degree by any means because young people are told degrees and certifications are the “keys to the kingdom” rather than the competencies behind those degrees. Some educators take advantage of this warped system as it elevates them to demi-gods of the kingdom who have the power to make or break young people’s futures. This “quiet corruption” across the education-to-employment system begins at the basic education end where you have teachers who coerce students and parents to pay for their (the teacher’s) own afterschool lessons or study materials in order to get favorable grades or “support” during the make-or-break national exams...to secondary and tertiary levels where #sexforgrades and student extortion is commonplace... all the way to the employment end of the spectrum where desperate jobseekers are coerced into “paying to play”. A colleague of mine once shared that in her private university in Benin, an esti-

mated 50% of graduates paid for their degrees. Everyone knows the lecturers who accept or demand bribes, she said, and so from day one, you pick and choose your courses based on whether you intend to “pay to play” or “go it alone”. This isn’t just an African phenomenon: you can easily find sex-for-grades news articles chronicling incidents in the U S or even Singapore, albeit less endemic, or cases of the rich and famous paying their children’s way into university admissions. What’s universal across regions is the growing angst and anxiety that even though you can learn online most of the skills taught in traditional universities, that tertiar y degrees are still the gateway to higher earning potential. The way forward from here is to emphasize competencies over credentials. We all heard Kiki Mordi open up about how sexual harassment prevented her from getting that degree. Gasp! Who would have thought an on-air-personality-turned-investigativejournalist doesn’t have a degree! And yet, she must have developed the competencies required to produce such stellar investigative journalwww.businessday.ng

ism output through alternative means. What should matter are the competencies she has developed and not the lack of credentials. Imagine if 90 percent of job descriptions didn’t block out the 90 percent of Africans who don’t possess a university degree or the “relevant work experience” - which are always the top 2 requirements - and instead focused on the required competencies to deliver on the job?. It’s time to rethink and rewire our education-to-employment system so it starts to focus on competencies young people are developing inside (and mostly outside) of traditional classrooms and institutions and starts to screen them IN for those c o mp e t e n c i e s i n s t e a d o f s c re e n i n g t h e m O U T f o r lack of credentials (#CompetenciesOverCredentials). Employers and other “gatekeepers of economic opportunity” owe it to young people to design or adopt existing simple-and-cheap methods for screening based on competencies rather than using degrees as a proxy for capability I’ve seen how well this strate g y can w ork. Since 2013, our Nigeria-based organization WAVE has been

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“screening in” such hardworking young people regardless of their education background/pedigree and training them in the skills required to secure work, start a career and build a brighter future. Though the majority of WAVE’s 3000+ alumni do not possess a tertiary degree, their incomes more than double within one year post-training as they transition into formal employment, entrepreneurship or further their education. Elements of WAVE’s screen-train-match model are already being replicated by public secondary and tertiary educators as well as private and social sector organizations to train thousands of young people in work-readiness skills annually. WAVE is just one of many educators, employers, government enablers and youth who are part of a growing R e a d y 4 Wo r k m o v e m e n t committed to growing access to skills development and economic opportunity for young people regardless of their education credentials. Indeed, the shift is happening globally as humanmachine partnerships make it increasingly possible to evaluate candidates based on their capabilities rather than age, gender or educa@Businessdayng

tion pedigree, but I would argue that nowhere faces the emergency need to leapfrog more than the African continent, which will have the largest potential workforce by 2030. While of course it is important to work to expand access to tertiary education, we also owe it to the 90% who currently do not get access, to recognize alternative pathway programs that are succeeding in developing these skills in young people despite not being degree institutions. If we can achieve this, perhaps the next educator who tried to coerce a now-not-sodesperate student or parent would be told to “keep their grades” because the student had actually developed the required knowledge / competencies and was confident that the average employer used inclusive hiring practices that would give her the opportunity to demonstrate her competencies over credentials, her skilling over schooling. Misan Rewane is cofounder of WAVE, an organization focused on leveling the playing field for young people to access the skills and opportunity to become what they imagine.

Tuesday 15 October 2019

BUSINESS DAY

INTERVIEW

‘Nigerian unemployed graduates do not have skillset necessary for this 21st century’ Ademola Akitoye is the CEO and Director of AI Multimedia Academy. In this interview with BusinessDay, he shares insights on how his love for the multimedia industry led him to set up his company which has trained over 1000 young Nigerians. The CEO also sheds light on the importance of skill acquisition at a time when soft skills are key requirements for employment. Excerpts:

an you tell us all about A1 Multimedia Academy? My name is Ademola Akitoye. I am the CEO and Director of AI Multimedia Academy. We are into multimedia academy capacity development, skills acquisition, and for the past eight years, we have engaged in training a lot of youth. We have different courses that we offer in multimedia: graphic design, animation, cinematography, editing, visual events, and interactive design. We design visual events, marketing interactive designs, and web designs. How have you been able to tackle unemployment through your organisation? We recognise that the major challenge in our environment is unemployment simply because we have a lot of graduates who are not skilled. They have gone to school and graduated probably with B.sc and National Diploma but the Nigerian curriculum is not designed in such a way to make them employable when they are out of university. These unemployed graduates find it difficult to be gainfully employed because of insufficient jobs mainly resulting from lack of capacity. They don’t have that skillset that is necessary for this 21st century. So what we have been able to do over the years is that we have been training many of them and many of them are currently doing very well. They have gotten employment, some of them are working on their own-they are self-employed and we also have some of them that are now into graphics design full-time, feeding their family and have gotten married. We also have some of our students who have passed through our academy and are now doing well; they are now working in big organisations- multinational organisations, entertainment industry, publishing, and television production. You said your multimedia is about training youths. What brought about the idea to target and train the youths? When I graduated some years ago, I fell in love with training and a large part of me also fell in love with technology. Meanwhile, I graduated in1998; served the following year and then worked briefly with a Canadian. It was along the line that I realised there was a skill gap in the multimedia industry. I have always loved multimedia. I love camera and graphics, so I went for additional training outside the country, where I also did a lot of work and so realised there was a gap in the industry. I decided then that I was going to share my skills with a lot of youths. That was what brought about setting up A1 Multimedia Academy in 2011,

Ademola Akitoye

primarily for the love I have for training, and secondly I wanted to impact all my skills to the upcoming youths who motivated me with their interest in the industry. Another thing that motivated me to set up the firm was the skill gap in the industry. I wanted to provide many people with the necessary skills needed to take up the available jobs in the industry. How did you source for funds to start? Funding for SME is the major problem, and especially for someone who is just coming up with only a dream. The fund is a big challenge, no doubt about it, but because I was determined and needed to get it started, I had to sell my car. I needed to buy a very powerful laptop, and one or two gadgets. I couldn’t raise the money anywhere so what I did was to take the bold step of selling my car, my only car I had that time and that was how I started as one man. I started it all alone and I was just the only one working in the organisation but eventually, I had another person and from two we grew to three, four, five and we now have a staff strength of over 10 people. What are the challenges so far? The challenges are enormous. In this part of the world, power is the number one crucial thing needed for the survival of every business. We spend a lot on the power supply and it is really sad up till now no one has been able to solve the problem of power- that is the number challenge. The second problem is fund accessibility; banks don’t readily give money to SMEs and even if they give they give at an astronomical interest rate which is too high for SMEs. Another challenge is getting good peowww.businessday.ng

ple to work with you; the problem of getting trustworthy manpower that believes in your vision and what you want to achieve- I guess many youths also face that problem at the initial state. I think those are the challenges and we have been able to overcome them to a great extent through adjustment. In the area of funding, we have disciplined ourselves; most of the money we make is being put back into the business to grow. What are the challenges you face when trying to access credit from banks? There are stringent conditions if SMEs are trying to access funds from any commercial bank. The banks are out there to make money, there is no doubt about that and you can’t blame them. Looking at our environment, data are not readily available. Banks can give you money and you run away, who is going to be responsible for that? For you to access a loan in the bank, you need collateral. There is no doubt about it whether you are small or big, but tell me, how many SMEs have such collateral? However, the government is now coming out to help through the central bank by directing them to give loans to small businesses. Even with that, it is not easy to access the loans; you still have to pass through a lot of stringent conditions to access such credits. Can you tell us about your mission? Our mission is to make learning easier for youths, to train as much as possible in the area of multimedia so that they can contribute their quota to the growth and development of the nation and also have the ability to expand beyond the scope of Nigeria.

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Right now we only have one branch in Lagos so we are hoping to expand to other parts of Lagos, and Abuja. We have people calling us from Abuja, from Port-Harcourt, and some from Kaduna. Almost all states in the country want to see us, they need the skills. Some of them are begging us to come but due to lack of funds, we couldn’t expand as such. So our greatest mission is to expand beyond the present place we are and penetrate to other areas in the country, if we can do that then we will achieve a lot or one of our dreams. How has your vocational training been able to enhance the growth of the economy? In terms of employment, I think I have said it before: in terms of employment we have been able to equip young Nigerians through our vocational training to become employable. Some of them are now working as self-employed using the skills they studied in class. Some of the cinematographers, animators, and graphic designers are contributing their quota to the country. In addition to our contribution to reducing the unemployment rate in the country, we are also providing employment. As I said earlier on, initially when I started in 2011, it was just me alone but in 2019 we have over 10 working staff and we still want to expand. The more we expand, the more we are going to engage more people. How many students have been able to get employment after the training in your academy? Many have already gotten employment, I don’t have all the statistics but we have trained up to 1000 students since we started and I can tell you that a large percentage of them, let’s say 70percent of them, are positively engaged. Out of those that are gainfully employed, they are either working with organisations, or as freelancers, or as self-employed, so we have been able to achieve that. After training, how can one start even though he does not have the resources? Depending on the type of programme the person went through, the cost of starting might not be even more than the laptop they already own. So it might not be a big problem. For example, somebody who is into graphic designing does not need more than his laptop and from there he can begin to make some money and even if at all you don’t have money for other resources you can also be engaged by an organisation that will be paying you. It means every month such a person will be paid and as such can save up to buy whatever he/she needs to buy. If you want to be on your own it is not a problem. Either way, you @Businessdayng

start with whatever you have saved and begin to buy your equipment. So, whichever way you take, will get to where you are headed. For those who don’t have jobs after graduating what is your advice to them? Those who are jobless, who have not gone to any training, this is the 21st century. There is a big revolution going on all over the world and the revolution is skill. If you don’t have skills regardless of whether you went to Harvard and did MBA, whatever certificate you have, it is important to also acquire a skill. With that, people will engage you more. As much as the certificate is important and youths should acquire it, they should also remember that they need to back it up adequately with the necessary and modern skills. I will encourage anyone who is lying out idle anywhere to step forward, acquire a skill. One thing I can assure you of is that you will get the job. There is no doubt, you don’t even have to work for anybody, you can work for yourself and you can also team up with other people and have your company. We have students we have trained that have opened their own companies. So the opportunity is wide and there is a potential that the multimedia business is still growing and there is enough room for you to make it in multimedia business. What are the roles you want the government to play to help SME? The government has a lot of roles to play. One of the problems that need to be addressed immediately is the area of power supply. Another area that the government should come in is funding. They can provide more loans to organisations. I will make example of Lagos State employment agency that is giving cheap loans to SME. You know, the Federal Government can also come up with that kind of programme by getting a loan with enough moratorium and spread the loan repayment over the period of two, three, four or five years with 5 percent or 4 percent interest rate. I think that will help a lot of SMEs and engage more hands. What can you say on the rate of unemployment in the country and how can the government tackle it? The rate of unemployment is alarming in the sense that the engine of any development in any society is SMEs. For example, if you go to China today you will see a lot of phones, toys, and all that being manufactured. The Chinese government needed to encourage SMEs by putting in place the necessary infrastructure that SMEs can grow and society can change. I think a SME has a lot of roles to play in solving the unemployment problem growth rate in Nigeria.

Tuesday 15 October 2019

BUSINESS DAY

FEATURE

How Dubai’s ecosystem propels start-up incubation, expansion

…$100m fintech fund unlocked for Nigerian start-ups, others TEMITAYO AYETOTO

evin Czok rode a bright career in Germany, managing investments for a venture capital fund firm until he struck a chord with the idea of improving hotels’ presence around the web, selling bookings smarter within a short time. From reviewing about 800 opportunities for investment yearly, he gradually veered into researching and travel marketing to Dubai to affirm the validity of the problem he was about to solve. He found his outcome shocking. No one had solved the idea he describes as an ‘existing demand in an existing market’. A week after, he resigned, opted for the 10th global Fintech hub, Dubai, to nest his idea and found Gregory Amon as a co-founder. “I resigned from my job, a job that I would have continued for decades but this was an opportunity. Gregory had the industry expertise, I had the expertise in building companies and funding them and we jumped at it,” Czok said, speaking excitedly at the Entrepreneurship Department of the Dubai Chamber of Commerce and Industry. But why Dubai, instead of racing to queue behind an endless list of start-ups jostling for expansion push in Silicon Valley, UK, France, Germany or Switzerland? “The choice of Dubai is because it is a tourism hub; we have been supported very well by Dubai tourism under the Accelerator programme. There are just so many hotels, wealth, so many headquarters and chains we can have access to. We don’t do things because they are easy but because they are challenging,” Amon explained. Czok’s idea, Hotel Data Cloud, has since taken flight just as its start-up peers, Meekd. com, a specialised online search engine with a focus on no sponsored results or paid-for search results and JunkBot, manufacturer of robotic kit that enables people to build robots from almost anything. According to Meekd.com founders, leaving Bangkok, India for Dubai had everything to do with the opportunities including the amount of venture capitalists that actually have specific focus on technology. Essentially, they realised the ecosystem for support was already established. “It’s nascent as a lot of these have just come in the last three years. As it’s maturing, I think we are in the right place to do it,” he said. From its Chamber of Commerce to its financial centre, commodity trade zone and Fintech Hive, the government of Dubai is exploring various options to help start-up and emerging ventures through the early-growth stage, with particular focus on expanding throughout the region. For Sheikh Mohammed bin Rashid Al Maktoum, vice president of the United Arab Emirates, prime minister and ruler of Dubai who has decisively led this vision, the aim is to turn the city to a test bed for emerging technologies and exporters of innovative solutions. The Dubai International Financial Centre (DIFC), for instance, has asked Nigerian financial technology start-ups and others around the globe to think first of its Fintech Hive, especially with the unlocking of a $100 million Fintech Fund. Ghait Abdulrahman, head of Ecosystem Development & Partnerships at AREA 2017, another free zone said the centre is particularly enthralled by the vibrant growth of Nigeria’s Fintech hub and is keenly open to work with interested parties in terms of early-stage support for growth, expansion and experimentation with innovations.

The Dubai ‘Museum of the Future’, a futuristic design currently under construction, scheduled for completion in 2019.

Dubai ‘Office of the Future’, the most advanced 3D printed building in the world.

With financial inclusion drive of the Central Bank of Nigeria, growing smartphone penetration, the surge in e-commerce and regulatory impact of the introduction payment service initiatives, Nigeria’s cumulative Fintech funding has surpassed $250 million over the last five years, according to Enhancing Financial Innovation and Access Fintech 2018 report. Peyman Parham Al Awadhi, senior vicepresident, DIFC marketing and corporate communications at its Dubai headquarters said there was a deliberate effort to diversify the city’s economy into fresh areas of economic potential which the Fintech space features prominently. The Centre has already seen a marked increase in the number of firms that make up its eclectic Fintech ecosystem, which more than doubled in size from over 80 to 200 companies in the last six months. It has also witnessed a significant rise in the number of Fintechs wanting to participate in the DIFC’s dedicated accelerator programmes, which have become the first step towards testing the regional market for many global start-ups. Having recently recorded a three-fold growth of registering more than 100 Fintech firms in 2019, the leading international financial hub in the Middle East, Africa and South Asia (MEASA) is predicating its attraction on three main supportive structures: its Innovation Testing License (ITL), Fintech Hive

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and Startupbootcamp and an ecosystem of partners and potential investor. Through the Dubai Financial Services Authority (DFSA), the independent financial regulator, the DIFC in 2017 introduced the testing licence as a new kind of restricted licence to allow Fintech firms to apply for a customised class of financial service licence. ITL was tasked with the mandate to allow qualifying Fintech firms develop and prove innovative concepts under the DIFC guidance, without being subject to all the regulatory requirements that normally apply to regulated firms. Under it, Fintech firms are privileged to test products or services for six to 12 months, while the DFSA could consider extending that period in exceptional cases. And in instances where firms meet the outcomes detailed in the regulatory test plan, and the full DFSA Authorisation requirements, they will migrate to full authorisation. In the form of grooming, the DFSA works with applicants to understand the nitty-gritty of viable business proposal and establishes the appropriate controls for the safety of customers involved, on a case-by-case basis. The ITL initiative followed the launch of the Fintech Hive in June, generally referred to as the Dubai Future Accelerator programme. The focus has been to bring together leaders and entrepreneurs to compete and address the growing needs of the region’s financial services industry, using innovative technol-

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ogy solutions, in a variety of areas including trade finance and alternative finance-based services. Lately, the programme launched its 6th cohort, which will see about 30 companies from around the world participate and potentially sign MOIs with leading government entities looking to drive the next generation of innovations. With DFA’s efforts in facilitating collaborations, companies will work hand in hand with the government entities to address their industry-specific challenges as well as provide recommendations and smart solutions to tackle such challenges during the programme’s nine-week period. Also under the jurisdiction of the Accelerator is Area 2071. It has hosted 20 global start-ups valued at over AED 42 million to participate in two renowned global Accelerator Programs. What the initiative does is to serve as an ecosystem that offers start-ups and emerging companies, whether local, regional or global an innovative working space, allowing them to hatch their ideas, develop products and pilot projects, which in turn contribute to the economy and expand growth. The city’s authority plans to reinforce Dubai’s position as one of the world’s top ten FinTech hubs through an evolving regulatory environment, the quality of collaborators brought into the DIFC as its vision of driving the future of finance becomes a reality, Arif Amiri, chief executive officer of DIFC Authority said, responding to the growing choice of the DIFC by entrepreneurs seeking to scale their business in the region. According to the DIFC, its financial services aimed at promoting sector development which features continuous enhancement of its legal and regulatory infrastructure, most recently introducing a new employment and insolvency law. It has also created room for consultation of industry experts through sector-specific associations such as the Wealth Management Working Group. The centre especially boasts of a financial free zone in terms of legal, economic and tax advantages. It charges zero percent tax rate on profits, zero percent on personal income tax, permits full foreign ownership and removes the restriction on foreign talents or employees. With the DIFC companies enjoying the same tax benefits as 19 other free zone firms in Dubai, the DIFC has grown rapidly to be considered the foremost financial centre between the European and Asian time zones. It had about 1,853 active registered companies in as of March 2018, up from 1,648 at the end of 2016. In 2017, the DIFC’s total assets increased to US$3.55 billion, representing a 15 percent rise on the 2016 figure. DIFC’s net operating profit also rose, by 8 percent to a total of US$140 million. The DIFC’s ability to limit barriers to market entry for start-ups is an offshoot the United Arab Emirate management of the proceeds of its rich oil deposits. Although the Emirate’s status as a ‘no tax’ country came to an end in January 2018, when value added tax was introduced throughout the country, the rate, at 5 percent, remains one of the lowest in the world. However, there are challenges which some start-ups believe have to do with attracting venture capitalists. They believe there is still low competition for investment on the part of institutional investors, especially from outside the region. This is why the government is ensuring that its interventionist initiatives help spike the interest of investors at large.

@Businessdayng

Tuesday 15 October 2019

BUSINESS DAY

BDTECH

In association with

E-mail: jumoke.akiyode@businessdayonline.com

The drive for agent banking to significantly deepen financial inclusion …As Itex advocates mobile payment technology to reach the unbanked Nigerians JUMOKE AKIYODE-LAWANSON

ver the years, there have been concerted efforts by the Central Bank of Nigeria (CBN), deposit money banks, fintechs and other stakeholders in the industry to bring about a drastic reduction in the number of Nigerian adults who cannot access formal financial services. The importance of financial inclusion with the attendant benefits of raising the country’s Gross Domestic Product (GDP), improvement in the standard of living of citizens and increase in per capita income among other benefits cannot be over-emphasized. Agent Banking, a system of providing banking services such as cash deposit and withdrawal, bill payments, funds transfer and BVN enrolment to customers through licensed agents outside the bank branch has been identified as a major enabler of last mile access to formal financial services by the unbanked and underbanked population in Nigeria which as at 2010 stood at a whopping 39.2million individuals and 46.3 percent of the total adult population of the country. The Financial Systems Strategy

20:2020 launched by the Central Bank of Nigeria has as one of its focal points seeks to reduce the amount of people without access to financial services to a maximum of 20 percent of the adult population by year 2020. In 2018 the Shared Agent Network Expansion Facility(SANEF) was created with the primary objective of accelerating financial inclusion in Nigeria. The core objective of SANEF is the creation of 250,000 agent points by the end of 2019 and another 250,000 by the end of 2020 making a total of 500,000 agents in two years. In response to the needs of under banked or unbanked Nigerians,

companies such as Itex set up Agent Networks to drive inclusion through nationwide deployment of mobile money agents. This informs the introduction of the upcoming Itex Agent Banking Summit which is expected to bring together all relevant stakeholders in the agent banking space to reflect and discuss ways and means to ensure the sustainable growth and spread of agent banking in Nigeria as part of the strategy for achieving the financial inclusion goals of the financial system strategy. Deliberations at the summit are intended to culminate into formulation of key recommendations for

implementation by stakeholders. Speaking at a pre-event press briefing in Lagos, Ernest Uduje, MD/ CEO of Itex said that the upcoming Agent Banking Innovation Summit is designed for the purpose of developing innovative means to ensure the sustainable growth and spread of agent banking in Nigeria as part of the strategy for achieving the financial inclusion goals of the financial system strategy. “The summit will feature a keynote and lead speeches as well as discussion by a panel made up of industry experts. There will also be an interactive session where delegates which will comprise of representatives of banks, payment service providers, regulators, agent network managers, merchants and agents and other stakeholders will be able to make contributions and share perspectives,” he said. According to him, “discussions will range from the efforts of CBN and other stakeholders to expand the frontiers of shared agent banking network, to Nigeria’s experience in building agent network to a point of saturation. This will also include the formulation of key recommendations that will translate to a positive impact in the Nigeria payments industry.” Also speaking, Frederick Igbenedion, executive chairman, Itex said

the company continues to look for coordinated ways to support the ability of our agents and partners to enhance their efficiency in the delivery of financial inclusion services. “This Summit therefore follows from our pattern of driving innovations while always interacting with other stakeholders in order to design and deploy the most efficient and effective solutions to meet our collective goals to better serve general populace,” he said. According to the organisers, the maiden edition, asides from setting the tone for subsequent ones will deliberate on the role that innovation can play in driving the attainment of the goals of agent banking. Stakeholders in the agent banking value chain must be innovative in the way services are designed and deployed for specific targets in order to meet the needs of those targets. To address these issues at the summit, key players in the industry including Aishah Ahmad, the deputy governor, financial systems stability, Central Bank of Nigeria, Sam Okojere, director, payment system management, Central Bank of Nigeria, Ronke Kuye, CEO, SANEF, Wole Oyeniran, technology strategy &transformation Leader, Deloitte West Africa will be there to share insights with delegates.

Innovative technology solution providers to showcase futuristic tech at Nigeria eGovernment conference JUMOKE AKIYODE-LAWANSON

n a bid to enhance government service delivery to the masses and increase its internally generated revenue (IGR), technology companies like IHS, Airtel, Globacom, VDT, MTN, Galaxy Backbone and Broadbased Communications have indicated interest to participate at this year’s eGovernment Conference where new technology solutions that will enhance government service delivery and reduce unemployment in the country, will be discussed and showcased. The forum, which is scheduled to hold on October 24 in Lagos is being organised by DigiServe Network Services Limited in partnership

with the Federal Ministry of Communications, Federal Inland Revenue Service (FIRS), Nigeria Communication Commission (NCC), National Information Technology Development Agency (NITDA), Association of Telecoms companies of Nigeria (ATCON) and Nigeria Internet Registration Association (NIRA). The one-day conference seeks to discuss how technology adoption in government can boost government IGR, enhance government service delivery and reduce unemployment in the country. With the theme: eGovernment: Powering Governance with ICT, the conference also provides an opportunity for the stakeholders to discuss the recently approved National eGovernment

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plan and parley on how to remove the barriers militating against the growth of the Nigerian telecoms and ICT sector. Other technology companies that also indicated their interests to participate, include MainOne, Rack Center, ICSL, Nigcomsat, Juniper, Medallion, eStream Networks, Anchor Telecoms, Pan African Tower, 21st Century Technologies, among others. Biodun Omoniyi, the managing director of VDT Communications, said in his letter of response that VDT would participate and showcase its latest technology solutions that are currently driving retail broadband services across the country, which he said would enhance government service deliv-

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ery and boost IGR, while blocking financial leakages in government. According Lanre Ajayi, executive chairman of DigiServe Network Services Limited, “the Nigeria eGovernment Conference would provide a platform where government officials and experts in various specializations in ICT can interact, share perspective and develop roadmap to mainstreaming ICT in various departments of government. He assured Nigerians that the conference would not just be another talk shop, but an avenue to proffer practical solutions to real-life problems. “We are assembling top notch experts and world-class ICT service providers to come and share their expertise on how to deepen ICT in governance. The resolutions at the

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conference will be printed in book format and delivered to relevant government agencies and other stakeholders, with a view to ensuring implementation of the resolutions” Ajayi said. Babajide Olusola Sanwo-Olu, the governor of Lagos State, is expected to deliver the opening speech as the host governor, while Ernest Ndukwe, the chairman, board of directors, MTN Nigeria, will present the keynote address. Other keynote presenters include; Jim Ovia, chairman, board of directors, Zenith Bank, Babatunde Fowler, executive chairman, Federal Inland Revenue Service (FIRS) and Chairman Joint Tax Board (JTB), and Ali Isa Ibrahim Pantami, the minister for communications technology.

Tuesday 15 October 2019

BUSINESS DAY

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E-mail: jumoke.akiyode@businessdayonline.com

Indigenous tech company launches innovation to enable access to financial services with phone number JUMOKE AKIYODE-LAWANSON

oftcom, an indigenous software technology company focused on using innovation to solve some of Africa’s biggest challenges has come up with a solution for last mile financial inclusion with the launch of its latest innovation – ‘Eyowo’; a bank on mobile phone, which is said to revolutionise how people send, spend, save, receive and borrow money. According to Tomi Amao, CEO, Eyowo, “this solution was created in an attempt to solve the financial inclusion problem in Nigeria today. The aim for Eyowo is to provide simple, modern and reliable financial services to anyone with a phone number. This includes consumers, retailers, businesses, and developers.” Describing it as the bank for all, Amao said at the press launch in Lagos that; “Our target market is everyone who has a payment need and has a phone number. This includes people and businesses who want to make or receive payments for goods and services online and offline.”

L-r: Olusola Teniola; president, Association of Telecommunication Companies of Nigeria (ATCON), presenting award for Outstanding Contribution to the Telecom industry to Henry Iseghohi; the MD/CEO of Broadbased Communications Limited at the Nigeria Tech and Innovation Awards 2019, held in Lagos recently.

With Eyowo, Nigeria’s 173 million mobile network subscribers can send and receive money, buy airtime, pay bills, make cardless ATM withdrawals, request and accept payment from customers using only their phone numbers. The company says that indi-

viduals can also save and earn interest, borrow money at zero interest and have access to dollar cards to carry out international transactions. “We’ve engineered products that are truly accessible to everyone regardless of the social status

Inlaks hosts digital banking summit to proffer solutions for financial industry JUMOKE AKIYODE-LAWANSON

n a bid to further develop the banking industry in Africa with growing technology, Inlaks Limited, an information technology company and systems integrator is set to gather stakeholders, regulators and investors in the Financial Services Industry (FSI) at the maiden edition of the Inlaks digital summit to discuss issues and proffer solutions to aid the growth and development of digital banking. The summit which is scheduled to hold in Lagos on 18, October 2019, will explore the diverse opportunities technology offers to the financial and banking sectors and how African business leaders can harness it, as discussions will surround the theme of “Unlocking the opportunities in the digital banking age.” Speaking on the importance of digital solutions for financial services, especially at a time where there is a conscious drive to deepen financial inclusion rates in Nigeria, Femi Adeoti, managing director Inlaks said; “for over three decades, Inlaks has thrived successfully in bringing authentic and innovative solutions to its customers. In today’s world of unprecedented shift in digital tendencies across industries, every economic sector must be well-prepared for the imminent change to stay relevant. Inlaks Digital Summit 2019 will address issues relating to the relevance of technology to the financial and banking industries, preparing our industry for coming techno-

logical disruptions and arming them with adequate knowledge on the future of banking”. Tope Dare, executive director, infrastructure business at Inlaks told journalists during a pre-event press briefing at the company’s headquarters, that the summit has come at the right time given that there is now a rapidly growing adoption of digital banking by consumers and increased investments in this segment. “The financial service and banking sector, in the last decades, has witnessed disruption due to changing technology and consumer behaviors. By 2020, most of the big players in the fintech industry will be competing with banks for same customers. Therefore, only banks that can transform into an effective digital bank will survive the threat and stay relevant. At Inlaks Digital Summit, key players in the industry will share their experience on multiple solutions to the challenges related to branch transformation, mobile money and cyber security. Four major focus of the conference will be on data to drive business, new business models, regulatory requirements for digital banking and finally, technology that will influence banking operations,” said. On the involvement of Fintechs and telecommunications companies who have recently been granted payment service banking licenses to operate in the financial services sector and have the technical know-how, Dare told BusinessDay that stakeholders in banking as well as fintechs and telcos will be involved in discuswww.businessday.ng

sions to proffer solutions through a communique to the industry regulators. Also, he said that discussions on industry issues will help solution providers like Inlaks, think of ways to develop innovations that will aid the future of banking. “As companies continue to evolve, we realize that we need more of collaboration rather than competition. Banks are now collaborating with the technology companies to deliver value to customers,” he said. The summit will include panel discussions and keynote addresses, networking sessions, product exhibitions/demo and an award recognition ceremony. Elucidating more extensively on the summit activities, Olufemi Muraino, executive director, financial business at Inlaks added that awards of recognition will be given to Inlaks’ worthy clients and partners to appreciate their long-standing trusts in Inlaks as their service provider. He further mentioned that different OEMs will be exhibiting latest products and innovations to specialized decisionmakers focused on finding unique solutions and emerging technologies for successful baking operations. The summit parades over six partners and more than 300 participants. Inlaks said speakers have been carefully selected to represent every segment of the financial services industry, consumers, commercial banks, micro finance banks (MFBs), fintechs, insurance, telecoms companies, agent banking networks, and the regulators.

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they belong to. Eyowo is available on Android, iOS, USSD, Voice, SMS and on the web”, said Ope Adeyemi, product and partnership lead at Eyowo. The company also highlighted Eyowo retail, a service which uses just one tool to manage orders, payments, inventory, customers, settlements and reports, thus helping retailers organise their business more efficiently for optimal growth. Businesses can also now accept more forms of payment - cash, card, bank transfers, and Eyowo. “This will significantly expand the customer base and horizon for internet-enabled businesses who today can only receive payments from bank account holders.”, Adeyemi said. On how it works, Amao explained that retail payment has been re-invented through this tool, as the system allows retailers accept cash, transfer, card and eyowo wallet payments seamlessly with or without mobile internet subscription. Pair to pair payment has also been simplified as Eyowo has rethought corporate internet banking systems. According to him, the flex-

ibility of the platform has made it possible to build on top of the application program interface (API) solution as it has created a developer platform that enables developers to build payment products, tools, and experiences that people love by exploring Eyowo Developer API documentation, SDKs and other resources. These API integrations will help platforms in receiving payments and making payments to anyone who has a phone number. The system also allows for customers with trusted profile and spending habits to borrow money with zero interest. Interestingly, the Eyowo platform can now be connected to 1,500 different applications around the world. To deliver on its promise, Eyowo has partnered with leading financial service institutions including Providus Bank, GTBank, Interswitch, NIBSS, Bank of Industry, Verve, amongst others. “We will continue to join forces with organisations whose ethos are aligned with our vision for financial services in Africa,” Amao said.

Iseghohi gets award for outstanding contributions to telecom industry JUMOKE AKIYODE-LAWANSON

enry Iseghohi, the chief executive officer of Broadbased Communications Limited , an open access metropolitan fiber optic network company, has been awarded for his outstanding contribution to the telecommunications industry by the Association of telecom companies of Nigeria (ATCON), during its Nigeria Tech and Innovation Awards 2019, held in Lagos recently. Broadbased Communications Limited which operates an open access metropolitan fibre optic network covering all major districts in Lagos also won the Wholesale Telecom Provider of the Year 2019 and the Metropolitan Fiber Infrastructure Company of the Year 2019 Awards. Consequently the company provides Fiber Optic Network connectivity for Mobile Network Operators (MNOs), 4G network operators, all the submarine cable landing stations, all major internet service providers, all data centers, Nigeria internet exchange point, major global telecom operators, all the banks, the Nigerian Stock Exchange (NSE), all electronic payment switching and processing companies, oil companies, major corporate firms and @Businessdayng

residential estates in partnership with other telecom service providers in each estate. Henry Iseghohi said that, “these awards are testaments to the company’s dedication to the open access model, the goodwill of our esteemed customers, the hard work and dedication of the staff of Broadbased Communications who have installed and maintain over 3,500km of fiber optic cable connected to 22 points of presence in Lagos with additional metro fiber networks in Kano, Akwa Ibom and points of presence in Abuja, Port Harcourt and Enugu. According to him, capital expenditure required to deploy fiber is huge and companies do not need to duplicate such huge expenditures when they can share their fiber network infrastructure with other duly licensed operators. Iseghohi is a strong advocate of licensed operators coming together to address the varied issues facing the telecom sector in Nigeria including the effect of the major corporate customers on pricing for leased line services, their use of unlicensed operators, indiscriminate destruction of cable network infrastructure by road construction companies, access to low interest rate funds for network deployment amongst others.

Tuesday 15 October 2019

BUSINESS DAY

property&lifestyle Land prices soar as residential devt activities improve in H1’2019 Stories by CHUKA UROKO

n spite of the slowdown in the Nigerian economy, investors, especially those with patient capital and long term view of the market, are still committing money into the country’s investment market with many preferring to invest in property which is considered a more secure asset class. This explains why in the first half of 2019, land reprised its role as a stable investment, with its price rising year-onyear in many parts of Nigeria, especially Lagos where emerging destinations were the toast of investors and sundry buyers. Within the same period, residential development activities witnessed marginal improvement with government’s housing development programmes gaining traction more than ever before. In Lagos, land values appreciated sharply along the Agungi – Abraham Adesanya – Sangotedo axis and this is understandable. Price rise is always a function of demand. This axis is in high demand as they border the Lekki Free Trade Zone (LFTZ) which has many on-going developments. This means that land prices in the axis are pushed up by speculators with eyes on those developments which include the Dangote refinery project and other anchor projects in the zone as they near completion. The axis is seen to have

growth potential as land is demanded for housing, industries, commercial real estate development such as retail and office space; schools and other business activities. Northcourt Real Estate’s half-year 2019 market report shows that land price in Abraham Adesanya area has risen by 50 percent, year-on-year, from N24,000 per square metre in 2018 to N36,000 per square metre in 2019. Sangotedo recorded an increase of 7 percent from N28,000 per square metre in 2018 to N30,000 per square metre in 2019. According to the report, land price in Ikoyi and Victoria Island also rose significantly within the period under review. Ikoyi saw 24 percent price rise from N363,000 per square metre in 2018 to N450,000 per square metre in 2019. Victoria Island had a 13 percent price hike from N300,000 per square metre in 2018 to 340,000 per square metre in 2019. On the Lagos Mainland, Magodo, an upper middle class settlement in the city, led price increase at 16 percent, rising from N110,000 per square metre in 2018 to N130,000 per square metre in 2019. Ikeja GRA recorded marginal increase of 8 percent from 261,000 per square metre in 2018 to N240,000 per square metre in 2019. Although investment thinking in property is shifting with some investors opting to buy assets out of the country and many looking to sell local assets, there has been a marginal increase in activities

in the residential property sub-market. Market conditions, especially vacancy rates, have improved but not yet where the market should be. In Port Harcourt, vacancy rates have moved, but only slightly, when compared with end of 2018. “Old GRA, GRA Phases 1, 2 and 3 recorded vacancy rates of 7 percent, 9 percent, 9 percent and 15 percent respectively. Abuja’s Apo and Gwarimpa are 14 percent and 2 percent vacant. Ikoyi and Victoria Island in Lagos state are respectively 41 percent and 23 percent vacant,” Ayo Ibaru, Director Real Estate at Northcourt confirmed. According to him, the federal government’s National Housing Plan to construct 536 units in the Northern parts

of the country, even though below the expectation of analysts, made some progress. He said that developments were based on the study of what would fit best with the prevailing culture. The FCT’s quota in the development amounted to 72 units; Kogi, Kwara, Nasarawa and Benue have 76 units each while Niger and Plateau have 80 housing units each. Added to this is the 3.7 billion that has been committed by the Federal Government to the completion of the Zuma Housing Project in Abuja expected to be commissioned by Q2 2019. A major development in the market as highlighted in the report is on how coworking space initiative has continued to grow as business owners are unable to

meet up to the dollar rent obligations for Grade A office space. Ibaru noted that Nigeria’s commercial real estate market is going green. He said that most ongoing prime office developments, or those that have been delivered in recent years, are a testament to the fact that green buildings have come to stay. “Within the period too, the US government acquired about 50,000 square metres of land in Eko Atlantic City for the Consulate’s new head office,” he said, adding, “a 21-storey smart office tower is being constructed in Uyo, Akwa Ibom state at an approximate cost of 19 billion funded via a PPP; upon completion, it is expected to house leading oil services firms.”.

First Homes Africa redefines homeownership with novel solution for millennials

n incremental and consistent basis, the real estate market in Nigeria receives new innovations fashioned to redefine approaches and offer solutions to home ownership problems in the country. One of the latest entrants is First Homes Africa with its online landlord platform

…subscribers become home owners just contributing for 15 months that is out to change both the dynamics and narratives in the Nigerian housing market where affordability issues have consigned the young ones to the rental market. The platform which was launched on October 1, 2019, focusing on first time home

New standard for recycled plastic seen saving over N1.8trn yearly for Nigeria

buyers, especially the millennials, has an ambitious target of 60,000 apartments in the next four years to be delivered to home seekers through a well structured rent-to-own arrangement. The technology-driven platform which encourages subscribers to cultivate saving culture also allows them to contribute for only 15 months and become home owners in a location of their choice. “First Homes Africa is an online real estate start- up offering a transparent, flexible and unique approach to home ownership targeted at the continent’s young adult,” explained Bayo Ogunusi, a Co-Founder/CFO of the company who spoke to journalists in Lagos. Ogunusi explained further that by focusing on the least served demographic in the African housing market, the company provides housing designs and payment terms that are tailored to the life style

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of Africa’s millennial. According to him, due to growth in population and rural-urban migration, there is a growing gap in the demand and supply of housing in Nigeria. The housing market faces a number of challenges that affects its competitiveness and potential for growth. “These include, but not limited to poor infrastructure and outdated construction techniques; absence of cheap and long-term mortgages; administrative bottlenecks in title registration and planning permission,” Ogunusi said. He lamented, however, that interventions made by past and current governments at both federal and state levels to close the housing deficit have not yielded much result as all policies and programmes have consistently excluded first time home buyers. This gap, arising from the failure of those interventions, he said, was what First Home Africa was out to close. To

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do this, he explainedd, the company has built an ecosystem around their platform which comprises all housing stakeholders including the government, insurance companies, developers and builders, building materials manufacturers, built environment professionals, etc. “To further enhance delivery on our brand promise, we are already working with trusted partners in the housing ecosystem in Nigeria,” Francis Ekeng, the company’s founder confirmed at the press briefing. “With the use of technology-cloud computing, big data, predictive analysis, artificial intelligence, mobile technology and social networks, we plan to create a pull approach to housing market and create houses that are suited to the continent’s young adults lifestyle; reduce the waste traditionally associated with house design and building in Africa and pass the savings on @Businessdayng

new standard for rec ycled plastic wa ste ha s b e en developed in Nigeria and the promoters of the innovative product say it will save for Nigeria over N1.8 trillion annually. The new standard, which was developed by Standards Organisation of Nigeria (SON) in collaboration with stakeholders in the food industry, has capacity to improve production processes of plastics. It is also capable of ensuring safety and quality of products, leading to an increase in its use which, in turn, provides opportunities for employment rather than expending the nation’s hard earned resources on importation. SON explained that the need to develop the standard was also coming on the heels of a recent coordination by the federal ministry of environment to develop a national policy for the lifecycle of plastics in the country. At the moment, Nigeria is the third largest importer of plastics in primary forms after Egypt with just 30 percent capacity to produce locally while the remaining 70 percent is being imported. Osita Aboloma, Director General of SON, said at a technical committee meeting on polymer and related products that there have been lots of demand for the standard for recycled plastics by stakeholders, the private sector and manufacturers, stressing that for the national policy of the federal ministry of environment to gain ground, it must be backed by standards. “This meeting would not have come at a better time than now when there are rising concerns over the use of recycled pet bottles in the food industry,” he said. The SON boss, represented by the agency’s Director, Standards Development, Chinyere Egwuonwu, said it would also give consumers and producers the confidence that the products and services they were developing or using were safe and reliable while also keeping the environmental safe. “The recycling of pet bottle packaging represents one of the most successful and wide spread examples of plastic packaging recycling. The growth in collection and processing of pet bottles for food packaging application has been increasing significantly over the last 10 years,” he said. He said further that the growth has been accomplished by significant investments in plastic recovery facilities and food grade recycled pet processing. “The food and beverage recycling association of Nigeria remains the driving force for the development of this standard,” he said.

Tuesday 15 October 2019

BUSINESS DAY

property&lifestyle How investments in housing sector can drive economic vitality, create jobs—El Rufai Stories by CHUKA UROKO

t a time in Nigeria when economic activities are slowing and job opportunities for the country’s teeming youth population are shrinking, investments in housing sector can drive economic vitality and create the needed jobs, Nasir El Rufai, Kaduna State governor, has said. Besides being a public sector operator, El Rufai is a built environment professional with a degree in Quantity Surveying. He is currently a fellow of the Nigerian Institution of Quantity Surveyors (FNJQS) and also a fellow of the Royal Institution of Chartered Surveyors (FRICS). The governor, who spoke at a one-day conference hosted in Lagos by the Royal Institution of Chartered Surveyors (RICS) Nigeria Group, said the real estate sector could play a much bigger role in the Nigerian economy than it is thought or even imagined. “In many developed nations, the property sector in general, and the housing segment in particular, is a bedrock of the economy and an important tool for stimu-

lating growth,” he said, adding, “housing construction indices are some of the most common measures used by analysts to gauge economic trends in Organisation for Economic Co-operation and Development (OECD) countries. In most economies of the world, real estate, especially housing, contributes significantly to their GDP. El Rufai cited USA, Britain and Canada where the housing sector contributes between 30-70 percent of their GDP. Investment in housing accounts for 15-35 percent of aggregate investment worldwide and the sector employs approximately 10 percent of the global labour force. Conversely, the housing and construction sector in Nigeria accounts for only 3 percent of the country’s GDP. This means that the country has an extremely low ratio of credit to GDP and, “of the little credit provided by commercial banks, only a fraction of it is for mortgages. Mortgage finance is where much of the economic opportunity in housing can be unleashed,” the governor said. This implies that Nigeria has to invest more in the housing sector and particularly in the mortgage sector

whose contribution to the country’s GDP at the moment is less than 1 percent. But, according to the governor, it is open to question if the federal government should be directly involved in housing provision, as a builder or giver of contracts. He however has no doubt that the government can do a lot through its agencies, especially in promoting longterm mortgages at singledigit interest rates. The governor, who was represented at the event by Hausat Adebola Ibikunle, the Kaduna State commissioner for housing and urban development, believes too that the government social housing is required, and this must be led by government because the market (private sector) alone cannot solve the issue of housing for all. Because of its multiplier effect, the housing sector has the potential to generate employment, increase productivity, raise standards of living and alleviate poverty. “Investment in housing affects all facets of life through its multiplier effect on economic development through forward linkages to the financial markets and backward linkages to land owners and the markets for

building materials, tools, furniture and labour,” the governor said. Besides the Nigerian Mortgage Refinance Company (NMRC), a secondary mortgage institution, another government’s intervention in the housing sector that is already driving economic vitality and creating jobs across the country is the Family Home Fund (FHF). “Family Homes Fund Limited is a partnership between the Federal Ministry of Finance and the Nigerian

Sovereign Investment Authority (NSIA) as founding shareholders,” El Rufai explained. According to him, the fund is the largest affordable housing-focused fund in Sub-Sahara Africa, leveraging its significant capital (in excess of N1 trillion by 2023) to facilitate access to affordable housing for millions of Nigerians on low to medium income. Through the strategic partnership with various players in the sector and

some of the world’s main Development Finance Institutions, he said, the fund has an ambitious commitment to facilitate and supply 500,000 homes and 1.5million jobs for the low income earners by 2023. The good news is that, “so far, the fund has constructed some homes and still constructing across the country from Lagos, Ogun, Kano, Adamawa, Borno and Kaduna, of course, with over 13000 jobs created and about 360,000 to be created.”

Estate surveyors canvass PPP model in housing devt to catalyse job creation ‘Innovation will drive change

ousing sector professionals under the aegis of Nigerian Institution of Estate Surveyors and Valuers (NISEV), have canvassed Public Private Partnership (PPP) model in housing development as catalyst for job creation and economic fortification. The estate surveyors who made their case during a Road Show that took them to the office of the Lagos State governor as part of activities marking this year’s United Nations World Habitat Day,

presented to the governor their ‘Roadmap to Housing for All’—a compendium of communiqués of the institution’s annual national housing summits. The United Nations has set aside the first Monday of every October, essentially, to draw global attention to the state of housing in towns, cities and communities as well as on the basic right of all to adequate shelter. Rowland Abonta, the president of NIESV, said the annual NIESV Housing Summit

has contributed immensely to the national housing discourse, by awakening the consciousness of the government and general public to the all-important aspect of housing to national life. The annual summit, he said, served as a key machinery for driving the vision and priorities of NIESV as a professional association, and also to serve as the window to the nation and the world in offering advocacy on housing, creating awareness through sensitization of government

L-R: Tosin Kadiri, Secretary, NIESV Housing Faculty; Emma Okas Wike, NIESV’s First National Vice President; Chika Okafor, Chairman, NIESV Faculty of Housing; and Adedotun Bamigbola, Chairman, NIESV Lagos State Branch, at a press briefing on the occasion of 2019 United Nations World Habitat Day. www.businessday.ng

and the general public on the importance of affordable housing delivery. Represented by Chika Okafor, chairman NIESV Housing Faculty, Abonta opined that the NIESV presented some recommendations as actionable strategies for all tiers of government to make affordable housing available to all citizens of Nigeria. The institution, in its eight (8) point recommendations, has urged government to be more committed to affordable housing delivery as its core social responsibility to all Nigerians by utilising housing as a catalyst for economic development. “Housing should also be used for arresting urban decay through effective delivery strategies,” the president said, advising that the government should engage professionals in the housing delivery value chain such as the estate surveyors and valuers. He advise further that government should reduce housing cost through modern techniques and construction materials; build a robust mortgage system with single digit interest rate regime and tame crime challenges through city regeneration.

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needed in real estate industry’

ncreasingly, innovative ideas are coming into all facets of real estate—development, investment, marketing, leasing and even advisory—all reflecting the realities of today. Real estate is the largest asset class in the world said to be worth more than all the stocks and bonds combined. Experts say that, in the last three years, there has been an increased interest in PropTech and other innovations. Experts and chief executives in the industry recognize the impact of innovation and are progressively adopting digital solutions for their organizations, believing that it is innovation that will drive the needed change in the industry. “It is common knowledge that innovation has changed the way business is done in the 21st century and there is no doubt that real estate has benefited from improved efficiencies,” Udo Okonjo, CEO, Fine and Country West Africa, confirmed to BusinessDay. Okonjo said that, given the days of online listings, virtual tours, and e-signing, @Businessdayng

there has been a significant shift in how things are currently done. With the move towards mobile, emphasis has shifted from efficiency to another dimension. “Not only are paperless transactions the norm, but mobile-centric technology has essentially transformed the landscape. Access to information, customer expectations, and client service are more different now than they were 5-10 years ago. And there are more changes to come,” she said. She quoted Alan Watts as saying, some time ago, that “to resist change, to try to cling to life, is like holding your breath: if you persist you kill yourself”. Okonjo is of the view that with little resistance to change, there are many lessons to be learned, adding that it is of concern that real estate practitioners will sometimes have trouble unlearning old methods and relearning. She cited instance of mobile business transactions which are not just a new way to conduct business, but a fundamental change in the way things are done.

Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINES DAY

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Tuesday 15 October 2019

BUSINESS DAY

news Nigeria’s entrepreneurship sector gets boost as International Breweries trains 300 youths Daniel Obi

total of 300 successful applicants have emerged out of 17, 000 applications across the country in the 2019 edition of International Breweries Kickstart. The Kickstart is an innovative youthentrepreneurshipprogramme that empowers young people with the financial muscle, training and mentorship to implement different entrepreneurial ventures. The 300 successful applicants emerged based on three criteria namely: feasibility of the business proposal, scalability of the business in its ability to create additional jobs and continuous positive impact in its community. They will progress to the next phase known as the Boot Camp. The Boot Camp, which is designedtotrainshortlistedapplicants on profitable business management, is a rigorous three-day capacity building intervention that will expose the young entrepreneurs to course contents that will aid them in managing their businesses in their respective communities. The threeday Boot Camp training boasts of a robust curriculum which comprises of courses on introduction to entrepreneurship; business plan development; customer service; leadershipandteambuilding;introduction to marketing; business laws &taxation;andbusinessaccounting 101 among others. Participants will also receive the enterprise tool kit from the Enterprise Development Centre of Pan Atlantic University.

Thetraining,accordingtoastatement will take place in three designated venues in Lagos, Abuja and Anambra states to aid easy access for youths who applied across Nigeria. According to Michael Daramola, legal/corporate affairs director, “Worldwide, mentorship, training and start-up capital are three vital pillars of success in business. Over the years, the statistics of business failures have confirmed this to be true. This is the reason we take this phase very seriously and have carefully selected our faculty members who will build the capacity of these young entrepreneurs with the necessaryskillsandknowledge to make a difference in their businesses and their respective communities by extension.” Having become a national empowerment programme, this year’s edition received more applications from the agricultural sector closely followed by manufacturing and production. Others are ICT related businesses, crafts, education, circular packaging among others. In her own words, Temitope Oguntokun, country lead, Sustainability and Stakeholder Management, International Breweries, said, “We are very happy and satisfied with the turnout for this year’s edition which has gone national. 42% of the applications emerged from South-West while South-South and South-East had 17% and 16% respectively. The Northern region comprisingNorth-East,North-West and North-Central accounted for 25% of the applications received. www.businessday.ng

BDCs see VAT increase leading to unemployment, poverty Hope Moses-Ashike

ureau De Change (BDC) operatorsinNigeriahavecondemn the proposed increase in Value Added Tax (VAT) to 7.2 percent from 5 percent, saying the increasewillleadtomoreunemploymentandpovertyinthecountry. They spoke through the Association of Bureaux De Change Operators(ABCON),notingthatthe immediate implication is that every Nigerian will either directly or indirectly be affected by the whopping 50percentincreaseinVAT. TheaverageVATcollectioninthe past6yearsisaboutN900billion.The revenue is shared 15 percent to the Federal Government, 50 percent to states and 35 percent to LGs net of 4percentcostofcollectiontoFIRS. Butbeyondtherevenueincrease of about 50 percent, the association says there will be other attendant consequences like higher inflation rate, interest rate hike, more unemployment and people will generally becomepoorer. The association says in a statement that it will increase the burden onthepoorandSMEscontrarytothe 2017NationalTaxPolicy.Wealsobelieve that seeking to expand the VAT net while also increasing VAT rate at thesametimeisaconflictingstrategy. “Instead ABCON review is of the opinion that the system can generate twice as much from VAT

at current rate by expanding the scope of threshold and ensuring a robust administration rather than by increasing rate. A review of VAT waivers,betterpolicingoftheborder to improve import VAT collection, framework for VAT on imported services and digital economy,” the statementnotes. On the other hand, the Association expresses concern over the rising level of the nation’s public debt, calling on the government to expresscautionandreductioninthe publicdebt. In its review of the BDC subsector in Q3’19, the Association calls on BDCoperatorstodevelopstrategies for attracting autonomous foreign exchange as well as for boosting inter-BDC trade so as to reduce dependenceonCBNintervention. “As business confidence increases within the BDC sub-sector, traders should improve on strategies to attract autonomous foreign exchange sources as against rigid concentration of CBN intervention funds. “With volumetric increase in foreignexchangeliquiditywithinthe sub-sector,INTER-BDCtradewillbe promoted resulting into dynamic exchange rate regimes derivatives. Thus, the framework and structure must be developed by the regulatory bodies and ABCON through adequate policies and supervision,” itstates.

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Technology critical to Sanwo-Olu’s THEMES agenda - official JOSHUA BASSEY

agos State commissioner for finance, Rabiu Olowo, says technological innovations were critical to drive the THEMES agendaoftheBabajideSanwo-Olu’s administration. The THEMES is derived from TransportationandTrafficManagement, Health and Environment, EducationandTechnology,Economy, Entertainment and Tourism as well as Security (THEMES), which formthepillarsthroughSanwo-Olu hopes to deliverance good governance to Lagosians. Olowospeakingataroundtable panel discussion on “Finance agility in digital world: Nigeria branch discuss 2019,” organised by Chartered Institute of Management Accountant (CIMA), in Lagos, said the government was conscious of the role technology plays in delivering quality governance and is leveraging it. “To take Lagos to the next-level, digitisationandtechnologyinnovationsissettoplaycrucialrolesinthe implementationoftheadministration’s THEMES agenda, especially in the education sector from 2020. “Digitisation and technology willcutacrossanddriveinnovation in transportation and traffic management,healthandenvironment, educationandtechnology,making Lagos a 21st century economy, entertainment and tourism; and @Businessdayng

security and good governance,” Olowo said. He noted that though the private sector “is a notch higher than public sector in digitalisation of their operations, the public sector will ultimately catch up.” The commissioner said that thegovernmentaccordspriorityto digital transformation of the state’s financial system, and “though there are challenges, lots of opportunities abound in digital innovations in the state’s public sector. “Technology is the loop to trigger innovations, improve financial system,growbusinessesandtransform the society. But for technology to achieve desired impacts, people need to be equipped and motivatedtobeabletoleverageon digitalinnovationsinmannersthat benefit individuals and society,” he said. Olowo,however,observedthat for technology to thrive and be effective in driving business and achieve better financial system, all stakeholders “must respect regulations. Inhiskeynoteaddress,Stephanie Beuvelet, the CEO of 9mobile said people and business “need to anticipate coming digital transformation, and that a lot of rapid changes would soon take place, especially in robotic engineering, artificial intelligence and mobile technology, as they would soon be faster, better and more clever.

Tuesday 15 October 2019

BUSINESS DAY

Markets + Finance

‘Providing proprietary research, commentary, analysis and financial news coverage unmatched in today’s market. Published weekly, Markets & Finance provides all the key intelligence you need.’

If FirstBank Insurance were a quoted company, its shares would be most attractive BALA AUGIE

FirstBank Insurance: HI Financial Performance

f FirstBank Insurance Limited were a quoted company, investors would have swooped on its shares, and it would have the most attractive valuations among peers. This is because the insurer has been thriving even amid the dark cloud hovering around the economy, as it continues to record double digit growth in earnings. It ranked first in key performance compared to peer rivals, who are listed.. With an efficient underwriting capacity, improvement in investment returns, and solid capital base, FirstBank Insurance will continue to remain a cash-cow to FirstBankHolding Plc, its parent company. The company attributes it success to an excellent manag ement team and board of directors who understand the industry, and a talented workforce. An efficient asset allocation strategy resulted in robust investment income that added strength to profit, as it invested the free float in investment securities like bonds and equity when yields were favorable. Firstbank Insurance’s gross premium income increased by 40.92 percent to N23.12 billion in June 2019, that’s compares to Custodian Investment revenue growth of 40.85 percent ; Aiico Insurance (31.74 percent); Nem Insurance Plc (28.25 percent); Wapic Insurance Plc (24.37 percent); AxA Mansard Plc (24.69 percent); Mutual Benefit Assurance Plc, (8.69 percent), Cornerstone Insurance, (8.64 percent); Lasaco Insurance, (11.11 percent), and (22.23 percent). FirstBank Insurance said the growth in revenue was driven largely by the retail life insurance business, annuity business and the corporate segment of the general insurance business.

In the entire industry, the company is the most efficient in curtailing cost while growing profit as combined ratio stood at 55.13 percent in June 2019. T h a t c o m p a re s w i t h Aiico’ combined ratios of Insurers’ ROAE

Insurers’ Combined Ratios

98 percent; AXA Mansard, (107.31 percent); Wapic, (160.36 percent); Mutual Benefit, (97.44 percent); NEM, (87.70 percent); Las a c o, ( 1 1 5 . 9 4 p e rc e nt ) ; Consolidated Hallmark, (107.67 percent); Law Union

and Rock, (127.08 percent); Sovereign Trust Insurance, 75.23 percent, and Linkage, (142.46 percent). The combined ratio is the sum of an insurance company’s loss ratio and its expense ratio. The industry norm is to achieve a combined ratio of less than 100 percent and the target is to bring it as low as possible;the implication is that a combined ratio of over 100 percent equates to an unprofitable company, Analysts at Coronation Merchant in a recent report said that FirstBank Insurance is able to create economies of scale for its front and back office operations, as evidenced in a benign expense ratio. Generally, size economies are evaluated by relating the operating cost (claims and operating expenses) insurers to their output level. While profits of insurers have been strained by major claims that resulted in huge underwriting losses, First Bank Insurance continues to utilize shareholders resources in generating higher profit. For instance, it has the strongest return on average equity among companies tracked by BusinessDay, signaling quality of asset. First Bank Insurance’s return on average equity (ROAE) stood at 46.97 percent in June 2019, that compares with Aiico, 40.0 percent ; Custodian 25.04

percent; AxA Mansard 13.07 percent ; Wapic, 3.07 percent; Mutual Benefit, 27.48 percent ; NEM, 24.45 percent; Cornerstone. 8.65 percent; Lasaco, 10.98 percent; Consolidated Hallmark, 10.61 percent ; STI, 33.41 percent, and Regency, 11.83 percent. Insurance companies in Africa’s largest economy are grappling with declining underwriting profit arising from falling rates due to unhealthy competition and craze to get few available business particularly corporate accounts. Also, high cost of doing business has makes it difficult for operators in the industry to breakeven, while taking a cover is the least of the problem of of an average Nigerian, whose pockets have been squeezed by rising inflation and spiraling utilities charge. Gross Domestic Product (GP) expanded by 1.94 percent in the second quarter of the year, this compares with 2.10 percent in the second quarter. Over 50 percent of population of 200 million people lives on $1.92 a day, and inflation rate at 11 percent is higher than the central bank’s target range of 6 percent and 9 percent. The average combined ratio (CR) of Composite Insurers over the period 2014-18 was 119.1 percent, while Non-Life and Life In-

BD MARKETS + FINANCE Analysts: BALA AUGIE www.businessday.ng

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surers have combined ratios of 110.20 percent and 115.40 percent, implying lack of underlying profitability, according to data gathered by Coronation Merchant Bank. Di sapp ointing ly, the country lags emerging markets in insurance penetration, but policy maker is implementing rules to ensure that operators in the industry are well capitalized so that they care take on more risk. N i g e r i a’s t o t a l 2 0 1 8 insurance premiums are reported at N400 billion (US$1.1bn) compared with nominal GDP of N129.1trn, thus 0.31% of GDP. In comparison, a country like India with similar US dollar GDP per capita to Nigeria has an insurance industry equivalent to 3.69 percent of its GDP. We examine India’s successful drive for insurance later in this report. Despite the above monumental challenges, FirstBank Insurance has been magnifying profit. Net profit after tax increased by 25.50 percent to N3.56 billion in June 2019 from N2.84 billion the previous year, and profit before tax rose by 27.10 percent to N4.30 billion in the period under review from N3.38 billion the previous year. First Bank is well capitalized to meet the new minimum capital base set by the National Insurance Commission (NAICOM). Its shareholders’ fund of N17.06 billion as at June 2019 is above the benchmark. Analyst s note d that some of the well capitalized insurers have the capacity to acquire smaller players with short falls of N3 billion and they added that insurers that are unable to raise capital could opt for recapitalization. “We believe it will be difficult for listed insurers with a shortfall of above N5 billion to raise additional capital from the current weak capital market,” said analysts at Chapel Hill Denham Ltd.

Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

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news South-East economy slumbers as governors... Continued from page 1

by the Chartered Institute of Project Management of Nigeria said. There are 15,000 abandoned projects in the SouthEast; 11,000 in the SouthSouth; 10,000 in the SouthWest; 6,000 in the North-West; 7,000 in the North-Central; 5,000 in North-East, and 2,000 in Abuja, the report said. For over 12 years now, the Enugu-Onitsha Expressway has been in a state of disrepair, wasting the lives of commuters in accidents and gunshots from dare-devil armed robbers. Yet, past and present governors of Enugu and Anambra States have failed to galvanise finances to build that road, justifying their inaction with a lame excuse that it is a federal road. Their empty excuse contradicts interventions in other parts of the country. On September 8, Dapo Abiodun, Ogun State governor, disclosed that he was working with Babajide Sanwo-Olu, Lagos State governor, to build and commercialise three federal roads: Ikorodu-Ogijo-Sagamu, EpeIjebu-Ode and Lagos-OtaAbeokuta roads. “I met with my counterpart, Sanwo-Olu, and we decided that as a matter of urgency, we need to take over some roads which include Epe-Ijebu road, Ikorodu-Sagamu road and Lagos-Ota-Abeokuta road so as to reduce the population of the people passing the LagosIbadan Expressway,” Abiodun said. “Sanwo-Olu and I met with the president to hand over those three roads… A few weeks ago, the president handed over the roads to us,” he further said. Several Nigerians from the South-East region have died on Enugu-Onitsha Expressway. On June 11, 2018, a family of seven died on EnuguOnitsha Expressway in one out of hundreds of fatal accidents that occur on that road. The road is currently under construction by the Federal Government, but such construction has been on since 2007 during the time of late President Umaru Musa Yar’Adua. Several federal roads in the region are dilapidated, but state roads are also not better. From Anambra to Imo, down to Enugu, Abia and Ebonyi, roads are death traps, Busi-

nessDay checks show. In Imo State, NazeNekede-Iheagwa Road is an eyesore. Students pay N150 instead of N100 to go to school from Owerri town, with commercial motorcyclists having a field day. The state has become one big dumping site – with wastes dumped along the streets, thereby courting disease outbreak. South-East states are not among the poorest in the country. Abia State got N33.52 billion in federal allocation and internally generated revenue in the first and second quarters of 2019, according to the National Bureau of Statistics. Anambra has N32.23 billion while Ebonyi got N26.5 billion. Enugu State’s share was N35.7 billion and Imo got N37.4 billion. The cost of rehabilitation of Enugu-Onitsha road is N7.35 billion, according to the Federal Ministry of Works’ record. Mbaise-Umuahia Road costs only N102.5 million. “Nobody is feeling the impact of those governors,” Sam Oyigbo, lawyer and pastor, said. “Their roads are terrible. Streetlights in Anambra and many of the states are not working. No water, no security, and taxes are increasing, but you will not see what they do with the revenue they get,” he said. Analysts say the region’s governors have failed to attract investors owing to policy inconsistency and petty politics. In real sector investments, the region has attracted only 3-5 percent of investments in the last seven years, according to the Manufacturers Association of Nigeria data. There is a case in hand. Few years ago, a Chinese machine maker Zhengzhou QI’E Grain and Oil Machinery Co Limited planned to invest over $10 million in small-scale palm oil mills in five states in Nigeria, including Imo and Anambra. Zhengzhou was to provide funds and machines to the small-scale palm oil millers to enable them supply it with palm oil. Letters were sent to governors of the states to provide land for smallholder farmers for expansion, according to Igwe Hilary-Uche, president of Oil Palm Growers Association of Nigeria (OPGAN).

•Continues online at www.businessday.ng

CBN contradicts self on Diaspora ... Continued from page 1

its pocket,” Okorafor said.

THE FACT To check for the authenticity of the $2.6 billion remittances claim by the Central Bank, BusinessDay proceeded to obtain official data as published by the apex bank. The data obtained from the CBN’s Balance of Payment report put Diaspora inflows in

the country at $24.009 billion in 2018. This contradicts the earlier comments of the CBN’s spokesman who claimed the Diaspora remittance was $2.6 billion. Efforts to reach Okorafor proved abortive as he didn’t response to calls from BuisnessDay about the subject matter. WHAT OTHER REPORTS ARE SAYING Further findings revealed www.businessday.ng

L-R: Adeyinka Shonekan, Divisional Head, Business Development, Central Securities Clearing System (CSCS) plc; Tunde Amolegbe, 1st Vice President, Chartered Institute of Stockbrokers (CIS); Haruna Jalo-Waziri, MD/CEO, CSCS plc; Dapo Adekoje, President, CIS; Oluwole Adeosun, 2nd Vice President, CIS, and Adedeji Ajadi, Registrar and Chief Executive, CIS, during a courtesy visit to CSCS.

2020 budget: FG under pressure to meet revenue... Continued from page 1

revenue generation.” She called on Nigerians as well as prospective investors to support government in solving the country’s revenue generation problems.

She warned ahead that “some reforms will be tough but must be done if we will look at the facts and be frank to ourselves” and assured on engagements with the private sector on any changes in taxes with regard to rates or administration methods. “Achieving fiscal sustainability and macro-fiscal objectives of government will require bold, decisive and urgent action. Government is determined to act as may be required,” she said. Ahmed said the government has recently launched strategic revenue growth initiatives to boost revenue generation to drive the targeted revenue to GDP ratio of 15 percent as set out in the Economic Recovery and Growth Plan. “We have launched the strategic revenue growth initiatives with three thematic areas, which include achieving sustainability in revenue generation, identifying new and enhanced enforcement of existing revenue streams, and achieving cohesion and elimination of identified leakages,” she said. “There is need to build a sustainable revenue genera-

CBN’s data of $24.009 billion is similar to World Bank’s data. World Bank estimated Nigeria’s Diaspora remittance would hit $24.311 billion, about 6.11 percent of its gross domestic product. Another report by a government agency, National Bureau of Statistics (NBS), said remittances from Nigerians abroad rose to $24.05 billion (N7. 3 trillion) in 2018, from $21.5

tion ecosystem by ensuring resilient and optimal performing revenue streams while applying the right incentives, safeguard, accountability and performance Management systems,” she further said. “The 2020 budget is designed to be a budget of fiscal consolidation to strengthen our macroeconomic environment and investment in critical infrastructure, human capital development and enabling institutions key to job creation,” Ben Akabueze, director general, Budget Office, said. He said more revenues are needed to drive the expenditure and ensure that the budget works for all citizens, explaining that the budget seeks to enhance the social investment programmes to deepen their impact on the marginalised and most vulnerable Nigerians. Tunde Fowler, chairman, Federal Inland Revenue Service (FIRS), said the importance of the increase in value added tax (VAT) cannot be overemphasised as there is need to ensure increased revenue to fund the budget. He, however, stressed t hat t h e i n c re a s e d VAT would raise the capacity of the state governments to meet the needs of the citizens since they receive over 80 percent of the VAT. The House of Representatives Committee on Petroleum Resources (Upstream) has, meanwhile, urged the

Nigeria National Petroleum Corporation (NNPC) to step up its operations in order to raise the N10 trillion needed by the Federal Government to fund the 2020 budget. Musa Adar, chairman of committee, made the call on Monday when Mele Kyari, NNPC GMD, appeared to interface with the lawmakers on the operations of the agency in the upstream petroleum sector. Adar wondered why Nigeria always had a deficit budget with the quantum of petroleum it produces and called on the NNPC to generate more revenue for the country. He noted that with the formal engagement with NNPC and other agencies, there was need to plug all the loopholes in the revenue profile of the agency for the benefit of Nigerians. In his response, Kyari said NNPC was taking steps to realise the national target of 3 million bpd and 40 million barrels of reserve of oil before the end of 2023, lamenting that there were challenges in the oil sector which the present management of NNPC was poised to tackle. He also appealed to the lawmakers to help put in place relevant legislations that would help in attracting foreign investment into the petroleum sector. The key assumptions of the 2020 budget as proposed by the government has oil price at $60/b, inflation rate

billion (N6.5 trillion) in 2017. PricewaterhouseCoopers (PWC), a private multinational professional services network with headquarters in London, United Kingdom, estimates that migrant remittances to Nigeria could grow to $25.5 billion, $29.8 billion and $34.8 billion in 2019, 2021 and 2023, respectively, while over a 15year period, PwC expects total remittance flows to Nigeria to almost double in size from

$18.37 billion in 2009 to $34.89 billion in 2023. “The growth in remittances is subject to global economic forces, which could spur or hinder growth of remittance flows. Other factors that will drive remittance flows include growth in emigration rate, economic conditions of the resident countries and the economic fundamentals in the Nigerian economy,” PwC said in its report titled “Strength

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at 9.98 percent, GDP growth at 3.01 percent, exchange rate at N305/$, nominal consumption at N119.28 trillion, crude oil production at 2.3 million bpd, and nominal GDP at N139.65 trillion. A breakdown of the budget shows a total of N8.15 trillion revenue, with N1.81 trillion projected to be derived from non-oil, N2.64 trillion from oil, and N3.7 trillion from other revenue sources. The proposed total expenditure stands at N10.33 trillion. Expenditure by the ministries, departments and agencies is projected at N2.145 trillion, recurrent expenditure at N4.88 trillion, debt service at N2.453 trillion, sinking funds at N296 billion, statutory transfer at N556 billion, leaving a deficit of N2.18 trillion. A further breakdown of the budget proposal shows that N259.2 billion has been allocated to Works and Housing, N127.67 billion allocated to Power, N123.07 billion allocated to Transport, N162.74 billion allocated to Education, and N99.87 billion allocated to Defence. Others include N90.98 billion for Health, N79.79 billion for Agriculture and Rural Development, N45.45 billion for Ministry of Humanitarian Affairs, Disaster Management and Social Development, N53.85 billion for Aviation, N78.34 billion for Ministry of Water Resources, N41.34 billion for Ministry of Industry, Trade and Investment, and N37.55 billion for Ministry of Science and Technology. from Abroad: the Economic Power of Nigeria’s Diaspora”. EXPERTS’ CONCERN Over time, stakeholders have raised concerns that the officially recorded remittances into the country are much lower than the actual remittances that take place through unofficial channels. This means a larger chunk of Nigeria’s remittances flows through the unofficial channels.

•Continues online at www.businessday.ng

Tuesday 15 October 2019

BUSINESS DAY

news

IIDA 2019: Indomie honours Nigerian ‘heroes’ for acts of bravery Desmond Okon

s a way of giving back to the society, Dufil Prima Foods, maker of Indomie noodles, awarded children who have demonstrated acts of heroism at the 12th edition of the Indomie Independence Day Awards (IIDA) held recently in Lagos. The award was started in 2008 to fete, recognise and reward Nigerian children as part of the social responsibility initiatives of Dufil Prima Foods. Kanye Chukwu, Anthony Lawrence, and Yahaya Zaki emerged winners from the three categories—social bravery, intellectual bravery, and physical bravery, respectively. Each winner went home with a cash prize of N1 million, a plaque and other goodies. “We are here once again to reward acts of heroism in young children who have made notable sacrifices at great risk to themselves, and those who have struggled to survive despite the unfavourable conditions they found themselves in. These children have pushed

the limits of courage and performance to a new level,” said Girish Sharma, chief operating officer, Dufil Prima Foods. In his welcome address, Sharma said the award was a reflection of the importance and belief of the company in the extraordinary qualities of the Nigerian child, which must never be ignored but celebrated. It was also said the award was in consonance with the organisation’s core values and deep-rooted belief that in every child lies the seed of greatness. “Dufil Prima Foods believes that children need to be empowered. IIDA is part of our efforts to empower our children and we have carried this out relentlessly for the past 12 years,” he said. It was learnt that since inception of the awards, 39 brave Nigerian children have been discovered across the country and celebrated on a big stage amid high-profile figures. Therefore, with the addition of three more heroes, 42 children now have their names written in history and in the hall of fame of Dufil Prima Foods.

PEBEC launches flagship tour in Lagos GBEMI FAMINU

residential Enabling Business Environment Council (PEBEC) has officially launched its flagship subnational tour in Lagos, as the event was witnessed by business leaders, state officials and representatives of federal and state government departments and agencies at the Federal Palace Hotel, recently. Themed ‘Lituation,’ the launch focused on highlighting several economic reforms engineered by the Council since July 2016, to transform Nigeria’s business environment, while also revealing a subnational tour of the six geo-political zones that offers entrepreneurs and other stakeholders an opportunity to collaborate more closely. Over three years, the Council through the Enabling Business Environment Secretariat (EBES), has successfully implemented more than 140 reforms, all geared towards making doing business easier for Micro,

Medium and Small Enterprises, which make up over 90 percent of registered businesses in Nigeria, contributing close to 50 percent of the country’s GDP. Delivering the keynote address, Babajide Sanwo-Olu, governor of Lagos State, lauded the strength of the young Nigerian entrepreneurs as engine of growth for the country, as he also remarked on the progressively-easier business landscape in Nigeria as a result of improvement in both physical and technological infrastructure. According to Jumoke Oduwole, special adviser to the President on Ease of Doing Business, “The next level for us presents itself as the need to deliver measurable results and impact in the improvement of regulatory, bureaucratic and legislative environments for businesses operating in Nigeria, particularly Micro, Small, and Medium Enterprises, so that you not only thrive, but are able to compete favourably with counterparts globally.”

Fuel subsidy to gulp N450bn in 2020 - finance minister

inister for Finance, Budget and National Planning, Zainab Ahmed, says under-recovery of Premium Motor Spirit (PMS), popularly referred to as fuel subsidy will gulp N450 billion in 2020. She said this on Monday in Abuja, at the public presentation of the 2020 budget proposals. Ahmed said it was called ‘under-recovery’ because it was the cost of operation of the Nigeria National Petroleum Corporation (NNPC). “We have a provision for under-recovery of PMS in the sum of N450 billion. If you look at the Budget of-

fice website, it is in the fiscal framework, which is an annexure to the budget.” The News Agency of Nigeria, reports that President Muhammadu Buhari had on Tuesday, presented a budget proposal of N10.33 trillion to a joint session of the National Assembly. He put the Federal Government’s estimated revenue in 2020 at N8.155 trillion, comprising oil revenue of N2.64 trillion, non-oil tax revenues of N1.81 trillion and other revenue of N3.7 trillion. Other estimates are N556.7 billion for statutory transfers, N2.45 trillion for debt servicing and provision of N296 billion as sinking fund. www.businessday.ng

L-R:Dermot Gaffney, Africa head of tax reimagined, KPMG South Africa; Nike James, partner tax, KPMG Nigeria; Wole Obayomi, partner/head, tax, KPMG Nigeria, and Ralf Baner, tax reimagined solution architect, KPMG EMA Region, at the press conference on the KPMG Tax Reimagined – a special technology-driven strategy for tax functions’ with an operating model to achieve reduction of costs, improvement of quality and unlocking of value in Lagos. Pic by Pius Okeosisi

Non-passage of PIB stagnates Nigeria’s oil reserves at 37.5bn barrel Solomon Ayado, Abuja

... as Lawan assures passage of PIB, PSC

igeria’s oil reserves are stagnated at 37.5 billion barrels since 2007 due to the nonpassageofthePetroleumIndustry Bill (PIB). This is as the situation has discouraged investments in the oil sector the PIB is required to restore, if passed. ThiswasrevealedMondayata public hearing session organised by the Senate’s Joint Committee on Petroleum (Upstream), Finance, Gas and Judiciary on Deep Offshore and Inland Basing Sharing Contract (Amendment) Bill 2019. In attendance were the minister of state for petroleum, Timpre Sylva, critical stakeholders in the oil and gas sectors including the group managing director of the Nigerian National Petroleum Corporation (NNPC), Kele Kyari, as well as managing directors of

oil firms. The minister said during the event that while the oil reserves increased from 22 billion barrels in 1999 to 37 billion barrels in 2007, only 500 million barrels were added to it between 2007 and 2019. Sylva noted that the reason for the stagnation was due largely to lack of required regulatory laws for the oil sector, and that the ugly situation had driven away investors. “The Public Hearing being held today on Deep Offshore and Inland Basin Production Sharing Contract (Amendment) Bill 2019 by the relevant Senate Committees,willnodoubtserveasprecursor for consideration and passage of PIB in no distant time. “Perhaps as a result of some level of regulations , from 1999 to 2007, we grew our oil reserves from 22billion barrels to 37bil-

Agric, finance ministers contradict stance on border closure Cynthia Egboboh, Abuja

inisters of agriculture and that of finance, budget and national planning on Monday raised divergent views on the border closure implemented by the government to check high level of smuggling, raise local production and earnings. Mohammed Nanono, minister of agriculture and rural development, said in Abuja that opening of the borders was not in sight as the neighbouring countries had failed to respect Nigeria’s stance on smuggling. The minister, speaking at the press conference in Abuja, said closing the border was a measure of controlling smuggling of goods into the country, “So long as these neighbouring countries bordering us will not respect Nigeria’s stand, the border will remain closed. “Our farmers are happy with the border closure, as

they are now getting better prices for their local produce, especially the rice farmers”, he said. Nanono, however, lamented that since the closure of the borders, there had been suspected smuggling of expired rice and raw materials through the ports. “Getting food in the country is fairly cheap compared to other countries. We are already producing enough to feed ourselves, but we need to reorganise our market to ensure free movement of food to deficit areas,” he said. However, Zainab Ahmed, minister of finance, budget and national planning, had earlier said that the government had started discussions with the neighbouring countries to address the issues to ensure opening of the borders. “We have begun discussion with the neighbouring countries to address the issues of border closure so we can reopen the borders.

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lion barrels which however got stagnated between then and now (2019) with 37.5 billion barrels , meaning that for 12 years, only 500 million barrels were added to the reserves. “The reason for this is very obvious, lack of required regulatory laws for the sector which has been driving away investors,” the minister said. According to Sylva, the situation can only be changed if the Senate set machinery in motion and accelerate passage of the PIB to enhance growth and stability of the oil sector. Meanwhile, the Senate president,AhmadIbrahimLawan,has assuredthatthePIBwillbepassed expeditiously by the 9th National Assembly. Specifically, Lawan, while declaring the public hearing open, said the bill that had not been passed since 2007, the 9th NASS

would break the jinx. He informed that the PIB was first introduced during the 6th National Assembly, to the 8th National Assembly and it was passed but not granted assented by the President. “Collaborative approach between the executive and the legislature is being considered in getting the PIB passed and assented to, this time around because the bill is highly needed to attract investors into the sector and widen our oil reserve base,” he said. On the Deep Offshore and Inland Basin Bill, Lawan has said the Senate will amend the law on Production Sharing Contract (PSC) Act. He said “it has become absolutely necessary for us to do so as a country so that we can generate more revenues from our endowments.”

NASS committees to work jointly as MDAs begin 2020 budget defense Wednesday Solomon Ayado, Abuja

s federal ministries, departments and agencies (MDAs) are expected to begin their defense for the 2020 budget on Wednesday, the Senate and House of Representatives’ committees in the National Assembly are to work jointly to enhance speedy passage of the appropriation bill. President Muhammadu Buhari had presented a budget of N10.33 trillion for the 2020 fiscal year, with capital spending allocations to key sectors. The Works and Housing sector has the highest allocation of N262 billion; the Power sector: N127 billion; Transportation: N123 billion; Universal Basic Education Commission: N112 billion; Defence: N100 billion; ZonalInterventionProjects:N100 billion; Agriculture and Rural Development: N83 billion, and Water Resources with N82 billion. Other sectors include Niger Delta Development Commission: N81 billion; Education: N48 billion;Health: N46 @Businessdayng

billion;Industry, Trade and Investment: N40 billion;North East Development Commission: N38 billion; Interior: N35 billion;Social Investment Programmes: N30 billion;Federal Capital Territory: N28 billion, and Niger Delta AffairsMinistryallocatedN24billion respectively. Also in the 2020 budget, the sum of N556.7 billion was provided for Statutory Transfers to include N125 billion for the National Assembly; N110 billion for the Judiciary;N37.83 billion for the North East Development Commission (NEDC);N44.5 billion for the Basic Health Care Provision Fund (BHCPF);N111.79 billion for the Universal Basic Education Commission (UBEC); and N80.88 billion for the Niger DeltaDevelopmentCommission (NDDC), which is now supervised by the Ministry of Niger Delta Affairs. Buharihadsaidthebudgetary allocation to the National Human Rights Commission increased from N1.5 billion to N2.5 billion to enable the Commission to performitsfunctionsmoreeffectively.

Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINESS DAY

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42 BUSINESS DAY

Tuesday 15 October 2019

news

Obaseki inspects Dangote’s Port, strategise on linkage with Benin River Port

do State governor, Godwin Obaseki, and president of Dangote Group, Aliko Dangote, on Sunday, inspected ongoing work at the Dangote Jetty and Port operated by Dangote Group on the Lekki axis of Lagos State. The port serves as an inspiration for the Benin River Port being developed by the Edo State government and China Harbour Engineering Company Limited. The governor, who has been attending meetings in Abuja and Lagos at the weekend, said key among the issues discussed during the inspection was how Dangote’s port would be linked to the Benin River Port to supply

petrochemical products to the port in Benin City. According to Obaseki, we discussed areas of cooperation and support for the Benin River Port, which will have facilities to receive products directly from Dangote’s plant. The visit included inspection of the Dangote Refinery and Petrochemical plants, reputed to be a game-changer in Nigeria’s petroleum industry. The Benin River Port is also expected to serve as a sister port to the Lekki Deep Seaport, being developed by China Harbour Engineering Company Limited. The preliminary tests for the Benin port project have been finalised.

Minister lauds private sector investment to promote entrepreneurial skills among youths KELECHI EWUZIE

inister of Labour and Employment, Chris Ngige, says investment by private sector in entrepreneurship will enhance the potential of the teeming Nigerian youths to become job creators rather than job seekers. Ngige lauded Nigerian Bottling Company Limited (NBC) for taking the lead in promoting entrepreneurship among Nigerian youths through its Youth Empowered Initiative. The minister made this known during the three-day Youth Empowered Workshop in Abuja sponsored by NBC, where over 500 youths were trained on life and business skills. The minister, who was represented by Martina Nwordu, director of special duties/projects in the ministry, described the initiative as laudable, affirming that such platform would greatly ignite entrepreneurial spirit in Nigerian youths. The NBC Youth Empowered workshop is part of the CocaCola Hellenic global initiative designed to support over

1,000,000 young people globally between ages 18 and 30 by 2025, to build life and business skills and long-lasting networks that will enable them transit to meaningful employment. The minister, who urged participants to take advantage of the opportunities offered by the company, disclosed that the Federal Government remained committed to solving unemployment challenges in the country. “I am very happy that you all chose to be here today, to empower yourselves and I want to reassure you all that the Ministry of Labour is totally committed to addressing the challenges of unemployment and underemployment confronting the youths of this country,” she said. Ekuma Eze, public affairs and communications director, NBC, in his welcome remarks, said the initiative was developed to help young people achieve their career ambitions by supporting them with relevant skills and right information they need to transit to meaningful employment as well as enhancing their potentials to be self-employed or job creators.

2019 Onitsha Ofala promo winners applaud Globacom

cross section of winners at this year’s Azu Ofala festival have applauded the major corporate sponsor of the festival, Globacom, for supporting people with its empowerment initiatives. One of the five keke winners, Ekpechi Henry, lauded the telecoms company for its credibility. “I thank Glo for this wonderful gift because it is not everyone that promises that can deliver,” Henry said. Another keke winner, Okey Eneh, said, “This is one of the wonderful things one can get. Globacom has demonstrated again that it cares and loves the people. I participated a couple of times and I am happy to show it to everybody that the Glo Ofala raffle is real.” In the same vein, one of the winners of the LED television sets, Ebirim Akunna Cynthia, a graduate of Computer Science, Imo State Polytechnic, Umuagwo, said it was simply unbelievable, adding, “All my doubts are over since I

received the call that I won a TV set. God bless Globacom richly.” Other Keke winners who were excitedly cheered by the crowd at a lucky dip drawn by the wife of the Obi of Onitsha, Igwenwanyi Achebe, included Ifeanyi Deluo Ike; Emeka Henry Chidi and Mofunanya Onochie, while the duo of Ikechukwu Mmadula and Ogbunando Adaeze also received television sets at the festival. Winners of the age grade carnival competitions held at Azu Ofala won various cash prizes. Aghaedo Age Grade (1970-1972) came first in the age grade competition while Umuawele Age Grade (1974-1976) was adjudged second and Malunwanne Age Grade (1961-1963) emerged third in the age grade competition for 1958 to 1980 age groups. For age grade 1948 to 1958, the first position went to Ndioma Age Grade (19561958), while Nwannebuife Age Grade (1952-1954) came second and Nnebuife Age Grade (1956-1958) emerged third.

L-R: Vincent Oyo, managing consultant, Image Consultants Limited; Olorunnissola Balogun, corporate communication and governmental relations manager, BASF, and Linda Brown, head of communications and transformation Africa, BASF, during their visit to BusinessDay head office, Apapa, Lagos. Pic by Pius Okeosisi

Transcorp Hotels fulfils postprivatisation obligations SEGUN ADAMS

ational Council on Privatisation (NCP) at its meeting Monday, presented Transcorp Hotels plc with a Certificate of Discharge, indicating the company has fulfilled all privatisation conditions attached to the sale of the hotel and will no longer be subject to any post-privatisation monitoring. At a ceremony that took place at the Presidential Villa, Vice President Yemi Osinbajo, who chairs the Council, presented the certificate to Tony Elumelu, chairman of Transnational Corporation of Nigeria plc (Transcorp), the core investor in the hotel. Speaking at the event, Alex Okoh, director-general, Bureau of Public Enterprises (BPE), stated that Transcorp excelled at achieving the KPIs established during the monitoring

and evaluation of the asset. Key areas of achievement include an increase in customer base by 113%, increase in service excellence captured by an 82% decrease in customer complaints, and an increase in operational efficiency with retained earnings rising to 70% of turnover. “The success achieved by the Hotel has evidently proven both the diligent process of implementing the privatisation programme on one hand and the commitment and professionalism of the Management Team of the Hotel on the other,” he said, adding that “The approval is sequel to the review and analysis of the outcome of our routine performance evaluation earlier conducted on the Hotel, which clearly indicates that the achievements recorded by Transcorp Hotels are in line with all the covenanted obligations embedded in the Share Sale Purchase Agreement (SSPA),” Okoh said. Recall that in 2005, Trans-

corp emerged the core investors in the privatisation of the hotel asset, which later became Transcorp Hotels plc in 2014 following a decision to make this asset available to the investing public as shareholders. The company later extended its reach to Calabar operating as Transcorp Hotels Calabar and further acquired strategic properties in Lagos and Port Harcourt where it intends to develop new hotels. In 2018, Transcorp Hotels completed a USD$100m upgrade of the iconic and multi-award winning Transcorp Hilton Abuja, which was a key factor that led to the final discharge of the company by the BPE from further postprivatisation obligations. Commenting on this, Elumelu said, “Our group is known for business turn around and value creation and I support public-private partnership as a viable option for catalysing our economic development.

For public-private partnerships to work and become a viable approach for the transformation of our country, privatised entities and their owners must justify government’s confidence in them by visibly improving the acquired assets, create jobs, and increase government revenues. “Such positive outcomes will encourage the government to privatise more national assets and free itself of revenue for critical social and infrastructure sectors such as education, healthcare, roads, transportation, etc.” He also commended this government for its efforts in driving economic development in Nigeria. Also speaking, the MD/ CEO of Transcorp Hotels, Owen Omogiafo, said, “This is a significant milestone in the history of our company and a further demonstration of our long-term commitment to improving lives and transforming our nation.”

Nigerian universities sign MoU with RDIC for digitisation, storage, publication services Jumoke Akiyode-Lawanson

niversity of Benin (UniBen) and the Benson Idahosa University (BIU) have become the first of Nigeria’s top universities to sign partnership agreements with Retail Development and Investment Company Limited (RDIC), an information technology company, to help digitise, store and publish data for the universities through the company’s publication engine, www.iwemi.com. RDIC, which primarily focuses on content management and distribution using technology tools, recently signed memorandum of understanding (MoU) with both universities in Edo State, agreeing to manage the universities’ digital assets, implement their e-Textbook programmes and integration, provide library content platforms and services as well as anchor the schools’ content distribution, among others.

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Speaking during the Uniben signing event, Ikponmwosa Omoruyi, chairman of Uniben public private committee and deputy vice chancellor of the university, said the partnership was aimed at driving academic excellence through the ease of access to information that digitisation would provide. “This event is epochal in our quest for driving academic excellence in our university. Our university’s partnership with RDIC will not only make for easy access to educational content for our students and academic staff through online storage of theses, dissertations and other publications, but will also boost the school’s revenue generation, completely eliminate intellectual property loss, facilitate ease of reference to specific project materials and provide global visibility of the school’s project work to multi-national companies and project financiers,” Omoruyi said. Omoruyi promised to give

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the partnership all the necessary support to ensure that it succeeded in its objectives, and urged members of the university community to avail themselves of the opportunity the partnership offered them to enrich their academic experience. Alsospeaking,MichaelOsasuyi, public relations officer of Uniben, saidhewasveryoptimisticaboutthe potential of the agreement to boost the profile of the school. “University of Benin is a trailblazer in the academic world and has got a number of firsts to its credit. This agreement, which is another first of its kind in the history of this country, will go a long way in projecting this citadel of knowledge in the best light and will earn it a place of pride amongst its peers locally and internationally,” he said. Ejimofor Akah, the project director of Iwemi.com, expressed his delight at the formalisation of the partnership and pledged to deliver on the expectations of the @Businessdayng

university. “I am delighted to be part of this partnership between the University of Benin and the RDIC. I convey our organisation’s commitment to providing quality and timely delivery of the services which we have been appointed to provide in such a manner as would bring about overall excellence and prosperity to the university,” Akah said. Regarding Iwemi.com, Akah explained thus: “Our platform engine enables lecturers to publish their academic textbooks, teaching aids and peer-reviewed faculty journals within minutes. The lecturers determine the sale priceoftheircontent,andonasuccessful sale, our partnership with Fidelity Bank plc ensures that the lecturer’s royalties are paid within 48 hours. Our team will also work with Uniben to scan and digitise project work submitted from 2001 till date and will also assist in preparing these records in a format that can be accessible on iwemi. com or any database,” Akah said.

Tuesday 15 October 2019

BUSINESS DAY

FINANCIAL TIMES

World Business Newspaper KADHIM SHUBBER IN WASHINGTON

s the impeachment inquiry by House Democrats gains momentum, Donald Trump’s attorney-general is running his own investigation. William Barr’s focus is not the president’s calls with Ukraine, but whether the now-completed justice department probe into Russian meddling in the 2016 election was the product of a conspiracy against Mr Trump that included US allies. This investigation of the investigators has come into focus in recent weeks as Mr Trump and Mr Barr have dragged allies such as the UK, Australia, Italy and Ukraine into old battles, just as a new war over impeachment has commenced. “I was investigated. And they think it could have been by UK. They think it could have been by Australia. They think it could have been by Italy,” Mr Trump said this month. Though Mr Barr has appointed John Durham, the US attorney in Connecticut and a widely respected prosecutor, to lead the justice department’s review of the Russia probe, both he and Mr Trump have courted controversy by getting directly involved. Mr Trump pressed Ukraine’s leader, Volodymr Zelensky, to assist his attorney-general, suggesting the Russia investigation may have originated in Ukraine. The US president made the request on the same July 25 call where he pushed for a probe into debunked allegations against former vice-president

Trump’s attorney-general investigates the investigators

Barr searches for evidence of a conspiracy against the president in the Russian probe

William Barr has taken the unusual step of visiting the UK and Italy as part of his review of the Russian investigation © AFP

Joe Biden, a frontrunner in the race for the Democratic presidential nomination. The US president made a similar request to Australia’s prime minister, Scott Morrison, while Mr Barr has taken the unusual step of travelling to the UK and Italy as

part of the review, employing ing a more hands-on approach than is typical for America’s most senior law enforcement official. The efforts have cheered the president’s allies, who have long argued that the real scandal of the 2016 election was the behaviour of

officials at the justice department and the FBI, which is part of the department. “The American people deserve to know how the false “Russia collusion” accusation started,” said Jim Jordan, the ranking Republican on the House oversight committee.

“That’s exactly what Mr Durham is doing with his professional and thorough investigation. He’ll find out exactly what happened and hold the right people accountable.” But the review has also stirred controversy overseas and sparked claims that Mr Trump is using US institutions for his own political benefit. “This is an investigation that has attributes of a political purge aimed at creating a counterfactual narrative to undermine, for political reasons, the legitimacy of a counter-intelligence investigation,” said David Laufman, a partner at Wiggin and Dana who helped oversee the early stages of the Russia investigation at the justice department. Mr Durham has conducted his work with little fanfare since his appointment in May by Mr Barr, who has claimed the FBI spied on the Trump campaign. “Spying did occur. The question is whether it was adequately predicated,” he told Congress in April. The justice department this month said Mr Durham was “exploring the extent to which a number of countries, including Ukraine, played a role in the counter-intelligence investigation directed at the Trump campaign during the 2016 election”.

Africa must take a leading role in the data economy

Ecuador bows to protests and scraps decree ending fuel subsidies

Continent-wide solutions will help boost growth and alleviate poverty

Austerity programme was introduced to satisfy $4.2bn IMF lending requirements

VERA SONGWE

GIDEON LONG IN BOGOTÁ

he Ecuadorean government reached a deal with indigenous activists on Sunday night to end 11 days of violent protests, saying it would withdraw a presidential decree that scraps fuel subsidies and replace it with a new one. President Lenín Moreno hailed the agreement as “a solution for peace and for the country”. “The Government will replace decree 883 with a new one that contains mechanisms to focus resources on those who need them most,” he tweeted, after talks with indigenous leaders brokered by the UN and the Catholic Church. He did not give details of what the new decree would entail. Mr Moreno announced decree 883 last week. It scrapped

fuel subsidies that had been in place for 40 years. He said it would save the state $1.3bn a year as it strives to meet the targets of a $4.2bn IMF lending programme. The end of the subsidies led to sharp rises in gasoline prices and diesel prices doubled overnight. Transport workers, leftist activists and indigenous groups took to the streets in protest, fighting violent battles with the police and armed forces, who this weekend have been deployed to enforce a curfew in the capital Quito. At least five people have been killed during the protests and over 2,000 arrested or injured in the Andean nation’s worst violence in years. The IMF and economists will be waiting to see what the new presidential decree contains to assess its impact on the IMF lending programme. www.businessday.ng

echnology has broken down barriers and ensured freedoms for millions in a way no other invention has be-

fore. At last month’s meeting of the UN General Assembly, 91 world leaders listened to US President Donald Trump rebuke China from inside the room, but hundreds of millions of people viewed the speech on their smart devices across the globe. However, the challenge for heads of state is to ensure that technology ushers in an age of prosperity for all citizens worldwide rather than an era of domination by a few, an all too familiar story. This can only be achieved by improving the governance of data — how information is collected and shared — and guaranteeing that all citizens have equal appreciation of, access to and control of, the new data economy. Harnessing the potential of technology and the data economy is essential to meeting the UN’s Sustainable Development Goals in Africa, from assisting development and accelerating prosperity to ending poverty. Unless positive action is taken, however, Africa could easily fall further behind.

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Decisions taken by African leaders and policymakers over the next few years on embracing the data economy will determine the scale of the benefits the continent and its people will realise. Rather than drilling for oil, Africa should be building for the data economy. Data is now the world’s biggest, most expensive and most important commodity and no society can afford to ignore its potential. The Brexit saga has shown Europe, if not the rest of the world, that integration is far better than disintegration. Asia continues to integrate and to construct a union with new trade agreements like the Transatlantic Trade and Investment Partnership, and the Mercosur trade deal between the EU and the South American bloc — Brazil, Argentina, Paraguay and Uruguay — has finally been agreed after 20 years of talks. Trade and integration remain an important part of a global solution for building a prosperous world. Africa is already taking a leadership role on integration, with the recent adoption of African Continental Free Trade Area agreement. Now it must also do so on the data discussion. African countries can claim a new and more influential position in the changing world order as the @Businessdayng

international community collectively seeks to design a new multilateral architecture for collaboration on data. Africa already has the tools with which to navigate the shifting global patterns, including its young population whose information, data and innovation will be sought by all. There a number of steps African policymakers can undertake in order to lead the data conversation. They should make an intelligent bet on technology (as they have done on trade), allowing it to guide politics rather than vice versa. They can embrace the innovation of Africa’s youth and reject scaremongering. African leaders should create a common intellectual property rights agency to protect the continent’s valuable assets. Economics tells us monopolies are neither fair nor efficient; data monopolies are unlikely to be any different. Given the global nature of the data economy and the crossborder capabilities that exist to collect and trade data products and services, global institutions like the UN, its affiliated organisations and the Bretton Woods institutions all have a central role to play in shaping global policy that will promote data harmonisation and interoperability, while still ensuring the collective interests of Africa.

Tuesday 15 October 2019

BUSINESS DAY

NATIONAL NEWS

Kurdish-Syria deal fails to halt Turkish assault Ankara vows to press on with operation to clear Kurdish groups from strategic town of Manbij LAURA PITEL IN ANKARA, CHLOE CORNISH IN BEIRUT AND HENRY FOY IN MOSCOW

urkish-backed Syrian rebels will press ahead with a plan to take a key town in northern Syria, Recep Tayyip Erdogan vowed on Monday, in a sign that a deal between Kurdish forces and Damascus may fail to halt the Turkish assault in the region. The Turkish president said Ankara was in discussions with Moscow, the most important foreign backer of Syrian leader Bashar al-Assad, about the fate of the strategic Arab-majority town of Manbij. It needed to be “emptied” of the Kurdish “terrorist organisations” that control it, he said, adding: “The true owners, our Arab brothers . . . they will enter there.” Mr Erdogan’s remarks came amid reports of Syrian forces mobilising close to Manbij as they headed north to the border frontline, underscoring the uncertain and fast-changing lines of control in north-east Syria after the Kurdish-dominated Syrian Democratic Forces (SDF) announced on Sunday that they had reached a military agreement with the Assad regime under Russian sponsorship. Kamal Akif, spokesperson for the SDF foreign affairs department, confirmed that under the memorandum of understanding, the Syrian army and SDF “will be in any border region under threat, Russia will oversee the movements of the Syrian army, wherever they are needed”. “Our priority now is to stop the Turkish attacks,” he added, referring to a Turkish assault that began last week. The operation, which Ankara says is aimed at establishing a 32km “safe zone” in a stretch of Syrian territory that adjoins the border with Turkey, triggered an international outcry and warnings that it could lead to a resurgence of Isis. Ankara, which has faced mounting warnings of US sanctions over its incursion into Syria, argues that it is targeting Kurdish terrorist groups linked to a militia that has fought a 35-year insurgency inside Turkey. But scores of civilians have reportedly been killed in the assault, which has forced an estimated 200,000 people to flee. Syrian regime forces moved quickly after striking the initial deal with Kurdish leaders, which appears to bring Mr Assad much closer to his aim of retaking “every inch” of the country as he strives to quash a crushing civil war now in its ninth year. Syrian army units have entered at least three cities across the north-east, including Ain Issa where the SDF is headquartered, Syrian state media reported. While analysts say Turkey

would be keen to avoid direct clashes with the Syrian army, which is backed by Russia and Iran, they say Ankara is likely to want to consolidate its gains and push on in the Arab-majority areas that have been the main focus of its campaign. Clashes continued on Monday in and around the towns of Tal Abyad and Ras al-Ayn, where the first week of the Turkish ground offensive has been concentrated, according to the London-based monitoring group the Syrian Observatory for Human rights. US troops, who guided and bolstered the SDF as they spearheaded the fight against Isis jihadis, have previously been stationed in Manbij, a frequently contested border city. It was unclear if they remained in the town after the Trump administration announced on Sunday that it would evacuate all 1,000 remaining American forces in Syria’s north. Mark Esper, the US defence secretary, said that the Turkish invasion had dug deeper into north-east Syria than expected, putting American soldiers at risk. Manbij, to the west of the Euphrates river, has long held symbolic significance for Mr Erdogan, who insists it “belongs to the Arabs”. The town has been under the control of Kurdish forces since 2016, when they pushed out the Isis jihadis who had seized it in 2014. Haid Haid, a consulting research fellow at the Chatham House think-tank, said it was important to Turkey to push the militia “back across the river” to consolidate and extend its influence in Syria’s north-west. “The only area they [Kurdish forces] control beyond that line is Manbij, that’s why it’s become the central fixation, he said. Murat Yesiltas, director of security studies at the Ankara-based think-tank Seta — which has close links to the Turkish government — said Turkey would be eager to see its proxies gain a foothold in Manbij before the Syrian army arrived in the region. “It’s first come, first served,” he said. Mr Erdogan said on Monday that there were “a lot of rumours” about the agreement between Kurdish groups and Damascus, which came just four days after the launch of the Turkish assault. He said Turkey was having “positive” discussions with Russia about the future of Kobani, a Kurdish-majority border town that is highly symbolic to Syria’s Kurdish population. “On Manbij we are at the stage of implementing our decision,” he added. Discussions between Russian and Turkish political and military officials were “ongoing”, Russian president Vladimir Putin’s spokesman said on Monday. He declined to comment on the content of any conversations. www.businessday.ng

From left: Michael Kremer, Abhijit Banerjee and Esther Duflo were recognised for developing new research methods to identify the most effective ways to fight poverty

Nobel Prize in economics won by trio for work on easing poverty

Abhijit Banerjee, Esther Duflo and Michael Kremer praised for experimental fieldwork DELPHINE STRAUSS IN LONDON

bhijit Banerjee, Esther Duflo and Michael Kremer have been jointly awarded the Nobel Prize in economics for their experimental approach to alleviating global poverty. Mr Banerjee and Ms Duflo — a couple both at work and in their private life — are professors at the Massachusetts Institute of Technology, while Mr Kremer is a professor at Harvard University. Ms Duflo, 46, becomes only the second woman to be awarded an economics Nobel, after the US economist Elinor Ostrom who won the prize in 2009 for her work on human co-operation. She is also the youngest-ever laureate in economics: the previous record was held by Kenneth Arrow, who was 51 when he was awarded the prize in 1972. The three, who often collaborate in their research, were awarded the prize — officially known as the Sveriges Riksbank Prize in memory

of Alfred Nobel — for developing new, experimental research methods to identify the most effective policy interventions to fight poverty through field studies. “Our goal is to make sure the fight against poverty is based on scientific evidence,” Ms Duflo told a press conference. “Often the poor get reduced to caricatures and even those [who] try to help them do not understand the deep roots of what is making them poor . . . We try to address problems as scientifically as possible.” The Nobel committee said the trio’s approach had “completely reshaped” development economics, with a clear impact on poverty and great potential to further improve the lives of the worst-off around the world. An example cited by the committee was their work on the “learning crisis”, which found that providing textbooks would not by itself help children learn more in school, without better and more tailored teaching.

Mr Kremer first ran field studies to explore these issues in Kenya in the mid-1990s, while Mr Banerjee and Ms Duflo later conducted similar trials in two Indian cities, Mumbai and Vadodara. Such field experiments have now become the standard method for development economists, the Nobel Committee said. Their approach mirrors those traditionally used in clinical trials for new drugs; but the Nobel committee noted that as well as testing whether a certain intervention worked, they also investigated why it worked, using contract theory and behavioural economics to understand the driving forces behind people’s decisions. Ms Duflo said it was “incredibly humbling” to win the prize, especially as it was usually awarded to those with many more years of experience, but added that the decision to recognise the field of development economics reflected “the incredible collective work” of hundreds of researchers in a network working on global poverty.

Spanish court jails nine pro-independence Catalan leaders Defendants sentenced up to 13 years for sedition and other offences DANIEL DOMBEY IN MADRID

pain’s Supreme Court has sentenced nine pro-independence Catalan leaders to prison terms of up to 13 years for sedition and other offences, in the climax of what the head of the court has called the most important trial in the history of Spanish democracy. Madrid has sent hundreds of law enforcement officials to Catalonia in anticipation of widespread protests against the sentencing and a possible deepening of the rupture between Catalan separatists and the government ahead of general elections on November 10. On Monday, protesters against the verdict blocked roads, while others converged on the centre of

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Barcelona. Spanish media reported that Pablo Llarena, the prosecutor in the trial, had responded to the verdict by reactivating his request for the extradition of Carles Puigdemont, the former head of the Catalan government, who has fled to Belgium. The case centres on the illegal independence referendum on October 1 2017, which the then Catalan authorities held despite the constitution’s provisions on the “indissoluble unity of the Spanish nation”, and a subsequent unilateral declaration of independence. In its decision the Supreme Court found the chief defendants guilty of sedition — leading what it characterised as an uprising that undermined the rule of law — but not of the graver offence of @Businessdayng

rebellion. The court sentenced Oriol Junqueras, the former deputy leader of the region’s government, to 13 years in prison for sedition and abuse of public funds. Six other former Catalan officials were sentenced to 10 to 12 years. Two Catalan politicians who headed pro-independence organisations were sentenced to nine years each. Three other defendants were fined and barred from public office for 20 months. “Today’s decision confirms the defeat of a movement that failed to gain internal support and international recognition,” said Pedro Sánchez, Spain’s caretaker prime minister, who accused the separatists of ignoring an antiindependence majority within Catalonia.

Tuesday 15 October 2019

BUSINESS DAY

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Gunvor has learnt lessons from corruption case, says chief Torbjorn Tornqvist vows to continue tightening procedures at the energy trader NEIL HUME

nergy trader Gunvor has learnt lessons from a longrunning bribery and corruption investigation and is willing to walk away from “good business” if it is too risky, according to its chief executive and majority shareholder Torbjorn Tornqvist. Last year a former Gunvor employee was given an 18-month suspended sentence after he admitted to bribing officials in Congo-Brazzaville between 2009 and 2012 to secure oil cargoes. “I don’t want to be involved with anything remotely like the Congo case ever again. And nor do our employees, or our stakeholders,” said Mr Tornqvist in an interview. “I am perfectly ready to walk away from good business if the compliance decision says it isn’t right. I am not frustrated about it. I am at ease with it.” The bribery case compounded what was a lossmaking 2018 for the company. However, it has bounced back this year, posting gross profits of $800m in the nine months to September, helped by more favourable markets and a strong performance from its gas business. Large-scale physical commodity trading often involves operating in countries that have been hotbeds of corruption, or where it is difficult to secure business without well-connected intermediaries. Some of these relationships have become a focus of investigations by the US Department of Justice, as well as prosecutors in Switzerland and Brazil. Geneva-based Gunvor is expected to announce a settlement with Swiss prosecutors this year in relation to its dealings in CongoBrazzaville. They have been investigating whether the company

failed to properly supervise its employees. “At that time the company was growing very fast. We did not have the right procedures in place,” acknowledged Mr Tornqvist. “Today, we have a top-tier compliance programme. And we must continue to improve it as the risks and markets continue to change.” He added: “Quite frankly I think the commodity industry will have to go the same way. What might have been acceptable 10 year or 15 years ago is not acceptable today whether from a legal, ethical, or moral point of view.” Gunvor was co-founded in 2000 by Mr Tornqvist, a former BP trader, and billionaire Russian businessman Gennady Timchenko. The privately-owned company has grown rapidly during the past decade and is now one of the world’s biggest independent energy traders, handling 2.7m barrels of oil and products per day. Mr Tornqvist holds 76 per cent of the company. Hit by tough trading conditions and a string of exceptional charges, Gunvor suffered its first ever loss in 2018. This triggered a major restructuring of the company that saw most of its senior management changed and top traders axed. “It was the most drastic overhaul of the business since I started it,” said Mr Tornqvist. “I realised we needed to bring in new ideas, a younger, more hungry generation. The overhaul remains an ongoing process.” Gunvor has been looking for a strategic investor and was close to a deal with Algeria’s state-owned oil company Sonatrach before the army deposed President Abdelaziz Bouteflika earlier this year. “Gunvor is not actively searching for a partner right now,” said Mr Tornqvist.

US private equity group to buy Sophos for $3.9bn Software-focused buyout firm Thoma Bravo agrees latest in series of deals KAYE WIGGINS, NIC FILDES AND PHILIP GEORGIADIS IN LONDON

S private equity group Thoma Bravo has agreed a $3.9bn deal to buy the cyber security company Sophos, removing another British technology stalwart from the public markets. The Oxfordshire-based cyber and network security software developer said that it was first approached by Thoma Bravo in June. Kris Hagerman, Sophos chief executive, said the offer of $7.40 a share in cash, a 37 per cent premium on last week’s closing price, was “pretty compelling”.Major shareholders including the private equity group Apax and the original founders, who collectively own more than a quarter of the company, have accepted the deal. Mr Hagerman said San Francisco-based Thoma Bravo, which has bought a string of cyber security

groups, intends to keep Sophos as a standalone company after the takeover, and give it the opportunity “to continue to grow, expand and execute in its own markets”. Thoma Bravo acquired Sophos’ rival Barracuda in 2017 and has added Imperva, Veracode and LogRhythm. It was reported to be interested in acquiring Symantec’s Norton and McAfee’s antivirus brands last year. The Sophos deal is its first outside the US. Sophos, which mainly serves small and medium-sized businesses, is the latest UK company to be taken private by a foreign buyer taking advantage of the pound’s weakness. Thoma Bravo warned shareholders in the UK that if they opt to take the money in sterling, they will have to shoulder any currency fluctuations that “result in a payment below or above 583p per Sophos share”. The deal will not close until the first quarter of next year. www.businessday.ng

Graft under Jacob Zuma cost South Africa $34bn, says Ramaphosa President tells FT Africa Summit impact of corruption is greater than thought TOM WILSON IN LONDON

decade of corruption under Jacob Zuma is likely to have cost South Africa more than R500bn, President Cyril Ramaphosa said on Monday. As he sought to reassure investors that sweeping reforms would revive the economy and bring perpetrators to account, Mr Ramaphosa warned that the impact of years of graft under Mr Zuma, his predecessor, was even greater than previously thought. “It was much bigger than I think most people could ever have imagined,” Mr Ramaphosa told the FT Africa Summit in London. “[The cost] runs way beyond, in my view, more than 500 billion. Some people have even suggested that it could be a trillion rand.” The R500bn ($34bn) sum is about a tenth of South Africa’s gross domestic product. Analysts have estimated that un-

der Mr Zuma, Africa’s most industrialised nation lost between R1tn and R1.5tn in missing tax revenues and a lack of foreign investment in addition to the direct costs of graft. The patterns of corruption that developed under the former president, widely described as “statecapture”, brought critical institutions including the revenue service and the state power monopoly Eskom, to the brink of collapse. Those responsible would now be held to account, Mr Ramaphosa told the audience of investors, business leaders and senior African politicians. “I am more confident than I have been in the past that our prosecuting agents, in putting together everything they need to do, will definitely be going after those who are complicit in criminal activity,” he said. “Be they in the country or outside of the country, they will follow them up.” Last week Mr Ramaphosa’s antigraft fight received a boost when the US government imposed sanctions

on the Guptas, the business family at the centre of graft allegations against Mr Zuma. The Guptas were “members of a significant corruption network” that diverted government resources to their businesses, the US government said. The family and Mr Zuma deny wrongdoing. Mr Ramaphosa, the former anti-apartheid leader turned businessman who served as Mr Zuma’s deputy for four years, took office in February 2018 promising to confront graft and rebuild the economy. Some 20 months later, many South Africans have criticised the president for moving too slowly, but Mr Ramaphosa sought to assure the audience that results were expected soon. “In the last year and a few months, we’ve made tremendous progress in turning our country around,” Mr Ramaphosa said. “We have stemmed that bleeding [and] we are now ready to open a new chapter.”

Mnuchin says tariffs may rise in December without final China trade deal Treasury secretary’s warning highlights fragility of ‘phase one’ agreement announced last week JAMES POLITI IN WASHINGTON

teven Mnuchin, the US Treasury secretary, has warned that a new round of tariffs set for December 15 on $156bn of Chinese goods would be triggered if Beijing failed to seal the limited deal tentatively struck with Donald Trump last week. Mr Mnuchin’s warning in an interview with CNBC on Monday highlighted the fragility of the truce reached on Friday in the US-China trade war, despite Mr Trump’s declaration that a “love fest” was suddenly at hand between the world’s two largest economies. While Mr Trump hailed the

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settlement reached on Friday after Liu He, China’s vice-premier, spent two days in Washington negotiating with top US officials, Chinese officials have been more cautious about the outcome, merely pointing to progress between the countries. The limited deal outlined on Friday involves the US holding off on a tariff increase from 25 per cent to 30 per cent on $250bn of Chinese goods, which was due to take effect on Tuesday. In exchange, China agreed to boost agricultural purchases and make some limited concessions on access to its financial markets and curbs on intellectual property theft. But there was no joint statement or text. @Businessdayng

Mr Trump said it would take up to five weeks to complete the “phase one” deal, roughly in time for him to meet Xi Jinping, at the Apec summit in Chile in mid-November. Although the US never took the December 15 tariff increase off the table, Mr Mnuchin’s explicit warning raises the stakes for remainder of the negotiations. “I have every expectation if there’s not a deal those tariffs will go in place, but I expect we’ll have a deal,” Mr Mnuchin said. The deal was limited because it failed to address many of the biggest sticking points in US-China economic relations that are at the root of the trade war, such as industrial subsidies and cybertheft.

Tuesday 15 October 2019

BUSINESS DAY

ANALYSIS

Economics Nobel for poverty work will help restore profession’s relevance Prize-winners prove economists are tackling one of humanity’s fundamental problems MARTIN SANDBU

y awarding the Nobel memorial prize for economics to three pre-eminent researchers on the causes and remedies for poverty, the Royal Swedish Academy of Sciences has not just honoured a particular body of academic work but given a shot in the arm for the broader standing of the economics profession itself. The failure to foresee the financial crisis as well as the neglect of growing inequalities for a long time has reinforced an image of the academic economists as so many Panglosses too caught up in their own otherworldly models to see the world as it is. There is little in economics that is more immune to that charge than the poverty research of Abhijit Banerjee, Esther Duflo and Michael Kremer, this year’s laureates. The very fact that the research being honoured is on the nature and causes of poverty demonstrates that economists have not forgotten about humanity’s fundamental economic problem — how to feed, clothe, and shelter itself and acquire other basic necessities of life. The problem

has mostly (but not entirely) been solved in the advanced economies, but the existence of development economics, to put it tritely, shows that economists care. Good economists also care what works. Mr Banerjee, Ms Duflo and Mr Kremer are being honoured for a long series of field experiments, or studies carried out in real but carefully controlled conditions to measure credibly what sort of policies can make a difference to poverty and related outcomes. They have taught us, for example, that education in poor countries is not always held back by lack of resources but rather by the failure to adapt teaching to individual learners’ needs; they also showed that temporary fertiliser subsidies did more to encourage poor farmers to improve their productivity than permanent ones. Their work reflects two very healthy tendencies in economics over the last few decades. The first is a strong empirical turn: the cutting edge of research has shifted from ever more sophisticated theoretical modelling to — also sophisticated but ultimately more useful — measurement of what happens in the real world.

Macron under pressure on security lapse in intelligence service Inquiry to probe how employee at Paris police HQ was able to mount attack DAVID KEOHANE IN PARIS

mmanuel Macron is under pressure to explain how an apparently radicalised IT worker could have remained undetected at the heart of the French intelligence services before killing four colleagues. A parliamentary inquiry is due to be given the go-ahead by lawmakers this week and will investigate the events in which the 45-year-old who had worked at the Intelligence Directorate of the Paris police headquarters since 2003 mounted a knife attack there this month. He killed three police officers and an administrative worker before being shot dead. Christophe Castaner, interior minister, said immediately after the killings that the attacker had previously given no cause for alarm. But evidence quickly emerged that he was both radicalised and had planned the attacks. According to police reports released following the attack, two of the perpetrator’s colleagues complained to their superiors about his behaviour in 2015 after he expressed approval for a deadly Islamist attack on satirical magazine Charlie Hebdo. However, they did not submit a written report and their concerns were not taken further. Some security experts blame the missed opportunity on police fear of being accused of Islamophobia and difficulties with defining radicalisation. Mr Castaner has since said the warning signals “should have been sufficient to trigger an investigation”, while Mr Macron said the idea “that

an individual ingrained with such an ideology can work in the exact place where such dangerous individuals are tracked down, is inconceivable, unacceptable”. In response to the attack, the government launched a review of how its intelligence services identify signs of radicalisation among officers. But opposition politicians are pushing ahead with the parliamentary inquiry, which will start work in the coming weeks. Mr Castaner is under particular scrutiny and was grilled last week by lawmakers. He is facing calls to resign, with some 71 per cent of people polled by Odoxa-Dentsu Consulting following the attack saying they do not trust him. France already has some of Europe’s toughest security laws, raising questions about how they have been applied and what more the government can do. Mr Macron turned some emergency police powers into permanent laws in 2017. The same powers were used by François Hollande, the former president, after 130 people were killed in terror attacks in Paris in November 2015. “There is no need for additional laws . . . This was not a failure of the law but a failure of detection,” said Jean-Charles Brisard, a former counsel to France’s chief antiterrorism prosecutor who chairs the Centre for the Analysis of Terrorism. “The problem with this particular case seems to be that the guy was not properly reported,” he said. “[He] supported the 2015 attacks on [satirical magazine] Charlie Hebdo. That’s not a low-level signal, that’s a high-level signal.” www.businessday.ng

An Austrian bank’s brush with hot Russian money Bank Winter’s alleged role in a $175m laundering scandal has shone a light on Moscow’s reach into Europe’s banking sector SAM JONES IN VIENNA

epresentatives of Italy’s far-right League party travelled to Moscow last October for a clandestine meeting with Russian agents. The Kremlin was ready to secretly fund the populist, anti-EU party. But when a recording of the talks was leaked, the political row that followed set in motion the slow disintegration of the League’s foothold on power, culminating with the collapse of Italy’s government in August. Yet the disclosure did not just cause political waves. The meeting had been focused on solving a practical problem: how to move dirty Russian money — running into the millions of euros — into Italy, through Europe’s heavilymonitored banking system, without triggering any alarms? The parties knew they needed a financial intermediary. It had to be in western Europe, but not in a country like the UK. It had to be dependable — and discreet. But above all, it had to seem legitimate. “If it is [through] Austria,” said Gianluca Meranda, a lawyer representing the League, “we have very good links with [Thomas] Moskovics . . . the owner of Winter Bank”. Mr Meranda’s off-the-cuff remark — caught on the recording — has forced Bank Winter, one of Vienna’s oldest and most opaque finance houses, into an uncomfortable spotlight. Little known outside the city’s small Jewish community, or in the treasury departments of other banks, it has tried to shut down what it called “unfounded speculation” about its business and its longstanding connections in Russia. The League’s scheme with the Kremlin never took off, the bank points out, and the tape makes clear that Bank Winter was not a route the Russians cared to use. Yet that its name should crop up in a discussion about secretive transactions between Russia and Europe was not entirely surprising.

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A lawsuit filed in Vienna in February 2017 accuses Bank Winter — which is contesting the action — of helping to launder $175m out of Russia’s National Bank Trust on behalf of its former management, into a labyrinth of offshore holding companies. Trust was saved from collapse in 2014 by a €2bn bailout from the Russian central bank, which accused its former owners of fraud. When auditors began to pore over Trust’s accounts they were surprised to find that a tiny Viennese private bank was one of its largest counterparties. The case shined a light on the hermetic world of Austrian banking, offering a vivid tale of how critical Europe’s banks have often been to ensuring the smooth operation of Russia’s banking system — and the extent to which Austria, in particular, has been a key hub for such activities. And it provides an example of the extent to which a banking culture geared towards offshore structures, facilitated by intermediaries and handshakes, can be abused to generate huge flows of illicit money. “Most of the Russian banking system is benefiting from these transactions,” says Thomas Moskovics, Bank Winter’s chief executive, of the deal at the centre of the legal action. “This whole situation is one big instance of how encumbered the whole Russian banking system is — one whole big mess.” One court-appointed expert in Vienna disagrees. Marcus Klug says Bank Winter should never have engaged with Trust. “The KYC [know your customer] audit was not completed . . .major documents had not been updated . . . essential documents were missing,” he says. The bank disputes this. Austria’s financial system is under intense scrutiny. In its most recent assessment, of the country the Financial Action Task Force, a G7 initiative that sets global compliance standards, found “major” or “fundamental” failings in the application of financial rules in seven @Businessdayng

of 11 criteria. “There is a tendency to think about Austria as a mini-Germany in terms of its financial and legal system,” says Tom Keatinge, director of the Centre for Financial Crime and Security Studies at Rusi, a British security think-tank. “But really it’s not.” “People have talked a lot about the Baltic states and their role in Russian money laundering but the banks in the Baltic were really just dumb bits of piping. The transactions which come through Austria are engineered.” Bank Winter traces its roots back to 1892, when Alfred Winter, a prosperous Jewish merchant in late imperial Vienna, branched out into finance. It flourished at the start of the 20th century. But in 1938, with the Anschluss, Bank Winter was “aryanised” overnight by the Nazis. It would take almost 20 years for the bank to be revived. The family was able to reclaim its prewar banking licence but had no capital of its own. So it did a deal with Simon Moskovics who had capital but no bank. A wily marketeer, Moskovics had made his fortune trading in postwar Vienna — a harsh, barter-based economy immortalised by Graham Greene in The Third Man. A Talmud scholar by the age of 18, Moskovics tutored far older men on the intricacies and shifting moral sands of the central text of Rabbinic Judaism. He had been persuaded by influential contacts in Zürich’s financial community, who were prepared to extend him credit, to open a lender of his own. Bank Winter was a perfect candidate. In the 1950s and 1960s, Moskovics used Bank Winter to pioneer a system of tradeable credit notes, allowing goods from Warsaw Pact countries to be efficiently sold in the markets of western Europe, despite sanctions and capital restrictions. Hugely lucrative, it was an arrangement that did not always sit easily with other European governments, which saw Vienna increasingly as a financial black hole being used by the Soviet Union to shore up its finances.

Tuesday 15 October 2019

BUSINESS DAY

Live @ The Exchanges DMO lists N15bn Green Bond on NSE Stories by Iheanyi Nwachukwu

h e D e b t Management Office (DMO) on Monday, October 14, 2019 listed the Federal Government of Nigerian (FGN) N15billion Green Bond on the Nigerian Stock Exchange (NSE). The 7-year Green bond issued by the Debt Management Office (DMO) at coupon rate of 14.50percent on June 13, 2019 is due to mature on June 13, 2026. This Series II Green Bond issued to finance renewable energy, afforestation, and transportation projects, follows the debut Sovereign N10.69billion Green Bond that was issued in December

2017 and listed on the NSE in July 2018. Commenting on the listing, Jude Chiemeka, Head, Trading Business Division, NSE, said, “We are pleased to admit the Series II FGN Green Bond to our Green and Sustainable Bond Market. Our collaboration with the Ministry of Environment (MOE) and the DMO on deepening the Green Bond market, which dates back to 2016, reinforces the Exchange’s commitment to position Nigeria as a financial center for green and sustainable financing. The recent partnership with the Luxembourg Stock Exchange (LuxSE) further demonstrates NSE’s passion to provide enabling environment for issuers and investors in the Nigerian capital market. The

Exchange will continue to work with key stakeholders in transitioning to a low-carbon and sustainable economy as well as develop innovative products and services in close collaboration with the market”. Chiemeka also lauded the Minister of Environment and the Management of the DMO on the successful issuance of a second Green Bond; a laudable feat in addressing environmental challenges and fostering sustainable financing in Nigeria. Nigeria’s participation in the Green bond market is in line with the Federal Government’s commitment to achieving its Nationally Determined Contributions ( N D C ) u n d e r t h e Pa r i s Agreement on Climate Change signed in September 2016.

Wema Bank partners Bank of Africa Group to improve trade services

ema Bank has signed a multi-countr y partnership agreement with Bank of Africa Group (BOA) as it looks to facilitate bilateral trade services for its customers across Africa. The partnership agreement was executed on October 14, 2019, by Ademola Adebise, MD/CEO of Wema Bank Plc and Amine Bouabid, CEO of BOA GROUP in the presence of Funmilayo Falola, Head Brand and Marketing Communications, Wema Bank and Brahim Benjelloun Touimi, BOA GROUP Chairman and other executives of both banks. Adebise signed for Wema Bank Plc while Bouabid signed on behalf of all Bank Of Africa subsidiary banks both within and outside the African continent. Under the terms of the agreement, the two financial institutions committed to deepening the relationship between them around the Pan African trade ecosystem (trade facilitation, correspondent banking etc.). Over the years, Wema Bank

has been passionate about supporting individuals and businesses in Nigeria. With the new partnership, it has expanded its frontier to include trans-African trade with a promise to deliver sustainable and value-adding support for business growth and profitability across the continent. Speaking on the partnership agreement, Adebise said: “At Wema Bank, digital innovation is in our DNA and we are bringing that same creativity to our partnership with BOA. This partnership will allow us to expand and redefine the galaxy of opportunities available to our individual and corporate customers as we lead them into the African continent off the back of the new African Continental Free Trade Agreement. With this partnership, our customers w ill now have seamless business transactions across countries with Bank of Africa’s presence. It is an absolute joy for us to be able to make doing business easier for our customers in partnership with the Bank of Africa.”

L-R: Ademola Adebise, MD/CEO Wema Bank Plc. and Amine Bouabid, CEO of BOA Group, at the signing ceremony of the bilateral partnership agreement between Wema Bank and Bank of Africa on Monday, October 14, 2019 in Casablanca, Morocco. www.businessday.ng

Adebise also added that both banks w ill fur ther benefit from an opportunity to promote bilateral trade services which will include Import and Export services, B o n d s a n d Gu a ra nt e e s, and Str uctured Finance collaborations under the new partnership agreement. On behalf of the BOA, Amine Bouabid said this about the agreement: “We are very happy to conclude this partnership with Wema Bank because it is in line with our will to always offer innovative, simple and useful solutions to our customers, and in this case in particular, to the companies that trust us. I hope that the link we create between Wema Bank and Bank of Africa will facilitate a n d t h e re f o re i n c re a s e economic exchanges with this great country that is Nigeria. I also see it as an example of collaboration between a Francophone Africa and an Anglophone Africa that must absolutely be encouraged and duplicated. Lastly, I would like to remind you that the Group I head is present in both French and English speaking Africa and that it plays its full role as an economic integrator. “ BOA Group is a panAfrican bank with presence in 18 Afr ican countr ies across the Anglophone and Francophone countries, 8 of which are in West Africa (Benin, Burkina Faso, Ghana, Ivory Coast, Mali, Niger, Togo and Senegal), 8 in East Africa and the Indian Ocean region (Burundi, Djibouti, Ethiopia, Kenya, Madagascar, Rwanda, Tanzania and Uganda) as well as in the Democratic Republic of Congo and in France. https://www.facebook.com/businessdayng

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Tuesday 15 October 2019

BUSINESS DAY

POLITICS & POLICY ADP kicks against INEC move to de-register political parties …Says only court can de-register party INIOBONG IWOK

he Action Democratic Party (ADP) has frowned at attempt by the Independent National Electoral Commission (INEC) to de-register non-performing political parties in Nigeria. No fewer than 91 political parties are registered in Nigeria; half of those numbers were registered just before the commencement of the 2019 general election. However, a dismal 12 out of the 91 registered won elections into the various positions that were contested for in the just-concluded general elections. An unprecedented 73 parties contested the presidential elections, while almost all the 91 parties fielded candidates in the governorship, national and states assembly polls. In recent months, the poor performance of the parties in the general election has prompted clamour

Sanni Yabagi, National Chairman of ADP

by stakeholders for INEC to deregister some of the parties ahead of the 2023 general election. They advocated for a constitutional amendment and review of the require-

ments for the registering of political parties. But speaking in an interview with BusinessDay, Monday, the national chairman of the ADP, Sanni Yabagi queried the criteria

the commission intends using to deregister the nonperforming parties. Some stakeholders have equally sought constitutional amendment to de-register weak political

parties and review the requirements for registering political parties. Sanni said the constitution which was supreme in the country was silent on deregistering of political parties, stressing that the procedure for deregistration of non-performing parties was not well spelt out in the Electoral Act. According to him, “I want to expect that the political parties would to go to court to challenge INEC on any attempt to delisting them; it is the court that would interpret if INEC has the power to delist political parties. “The constitution did not say INEC should deregister non performing political party, it is only the Electoral Act which is an act of parliament, but I think the question is what modality would be adopted; it must be open for all to see,” Yabagi said. He, however, admitted that there must be a mechanism to check non-performing political

parties, but added that it must be within the law. He advocated for a complete overhaul of the nation’s electoral system ahead of the 2023 elections to guarantee free and elections, saying that the registration of political parties must be handled with care. “I am not saying there should not be mechanism by INEC to check some of the non-performing parties, INEC registered them in the first place and they make it an all-comers affair which should not be. “We have to sit down and decide the kind of system we want before the next general election, there as to be an overhaul,” he added. Festus Okoye, INEC’s national commissioner, recently lamented the large number of parties which took part in the 2019 elections, stressing that the large number affected the commission’s performance adversely and made its work herculean.

Reps pledge to unburden Supreme Court, reform judiciary

Rain or no rain, we’ll fix Ogun roads, Abiodun assures

JAMES KWEN, Abuja

RASAQ AYINLA

otwithstanding the challenges of perennial rainfall and attendant flooding in most parts of Ogun State, the state government has said it would stop at nothing to fix the intra and inter-city roads under it. “We are even going beyond state and township roads, we have taken it upon ourselves to fix federal roads that run through the state”, a statement by Kunle Somorin, the chief press secretary to Governor Dapo Abiodun, said. The statement said the state governor has issued firm directive to the Public Works Agency (OGPWA) handling the palliative and reconstruction works across the state to step up its games and that he would not brook any excuses about rain. “Consultant to the state g overnment on Works and Infrastructure, Ade Akinsanya, told me that the governor is mounting pressure on the leadership of OGPWA to ensure that our people have roads to go about their business as a matter of right. Indeed, he challenged us to reverse the public infrastructure deficits in the state within the next few months – rain or no rain,” the statement

he House of Representatives has indicated interest to reconsider the existing laws in the country to ensure that the Supreme Court is no longer overburdened. Luke Onofiok, chairman, House Committee on Federal Judiciary, who gave the indication Monday at the inaugural meeting of the Committee in Abuja, said, the slow pace of justice delivery and backlog of matters is a cause for concern. Onofiok noted that some matters spend a minimum lifespan of 10 years before their final adjudication at the apex court and part of the problem with Nigeria’s legal system which allows all matters to travel to the Supreme Court without limit. He said not all matters should merit the attention of the apex court like in developed democracies such as United States where only constitutional and important matters reach the Supreme Court, hence general matters are handled by trial and appellate courts based on the precedents set by the Supreme Court. The Chairman stated that there are lots of reforms to be carried out in the judici-

Luke Onofiok

ary and the House Committee will in synergy with relevant bodies and stakeholders such as the Senate Committee on Judiciary, Ministry of Justice, the judiciary and civil society organisations invigorate the sector for effective performance and quick, efficient justice delivery to the common man. “It is my desire to work with every member of the Committee in repositioning the judiciary and addressing the challenges confronting it. The role of over sighting the judiciary entrusted to us is an enormous task. The enormity of the task is more demanding and pronounced in a developing democracy like ours where the independence

and operations of our judiciary is constantly under threat. “We need to continually advocate and protect the independence of our judiciary so that our judges will be bold and firm to dispense justice without fear and favour. By our laws, our judges are not allowed to speak freely. We hold our judiciary, and by extension, the people, a duty to speak up for the welfare of the judiciary. “In the coming days, the Committee will develop a work plan that aligns with the House Legislative Agenda recently unveiled by the Rt. Hon. Speaker, Femi Gbajabiamila, which will operate as a guide for the Committee,” Onofiok.

added. Shortly after inspecting some roads affected by the rain on Monday, Akinsanya said that the new emergency order declared by the governor, “is a new adrenalin for OGPWA to ensure that rain, though a major challenge for rehabilitation work efforts, does not stop the Agency from fixing all intra-city roads across Ogun State”. “We are poised to make our people heave a sigh of relief at the earliest possible time. We are only appealing for time to do a thorough job and that is why we are doing the works in phases,” he said. “What we have done is to segment the works into phases. There are some that could be done in the rain. These ones, we are doing straightaway. The ones that cannot be done in the rain will have to wait till the rainy season is over. But the governor is pushing us hard to deliver on public works and infrastructure,” he further said. Ade Akinsanya pointed out that besides the road construction and rehabilitation, the state government had also begun the redesigning and proper channeling of drainage in different parts of the state to avert man-made and natural disasters.

He explained that works were being undertaken to check the flooding being experienced by residents and road users in the state. “You will agree with me that potholes are numerous. Rivers are getting filled to the brim. Some roads have deteriorated so badly that they are impassable and some culverts and bridges are disasters waiting to happen, but we are not resting on our oars. We shall deliver good roads to bolster public transportation and increase economic growth generally,” the statement added. For almost 16 years, some communities on the Lagos/ Ogun State borders have been abandoned and their nightmare and challenges are aggravated due to the deplorable state of their roads. However, OGPWA has fixed the link road between Osi-Ota and Akowonjo in Lagos State, while palliative works are on-going along Oba Erinwole Road in Shagamu, Ajebo-Idi Aba, SiunOgere-Iperu roads linking Ogun Central to Ogun East Senatorial Districts are also receiving attention, as well as major township roads that have been enumerated across the 20 local government areas in line with the inclusiveness promised by the Dapo Abiodun administration.

Tuesday 16 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINESS DAY

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Tuesday 15 October 2019

BUSINESS DAY

Live @ The STOCK Exchanges Prices for Securities Traded as of Monday 14 October 2019 Company

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PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 261,257.41 7.35 -0.68 135 3,346,296 UNITED BANK FOR AFRICA PLC 205,196.53 6.00 1.69 125 4,098,148 ZENITH BANK PLC 561,997.24 17.90 -0.28 228 8,339,439 488 15,783,883 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 188,450.29 5.25 -2.78 174 6,576,417 174 6,576,417 662 22,360,300 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,646,086.70 130.00 - 74 602,127 74 602,127 74 602,127 BUILDING MATERIALS DANGOTE CEMENT PLC 2,470,873.57 145.00 0.55 64 1,796,479 LAFARGE AFRICA PLC. 257,724.73 16.00 - 54 430,402 118 2,226,881 118 2,226,881 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 304,225.84 517.00 - 10 3,106 10 3,106 10 3,106 864 25,192,414 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 85.50 - 3 681 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 1 4 UPDC REAL ESTATE INVESTMENT TRUST 13,074.52 4.90 - 14 375,500 18 376,185 18 376,185 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 18 376,185 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 OKOMU OIL PALM PLC. 52,417.35 54.95 - 9 1,863 PRESCO PLC 38,400.00 38.40 - 10 9,870 19 11,733 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,520.00 4.26 - 1 500 1 500 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,410.00 0.47 - 9 70,576 9 70,576 29 82,809 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 688.30 0.26 - 0 0 JOHN HOLT PLC. 214.03 0.55 - 0 0 S C O A NIG. PLC. 1,903.99 2.93 - 0 0 TRANSNATIONAL CORPORATION OF NIGERIA PLC 41,867.43 1.03 1.98 76 9,860,747 U A C N PLC. 19,160.62 6.65 -6.99 77 2,480,959 153 12,341,706 153 12,341,706 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 24,486.00 18.55 - 15 65,635 ROADS NIG PLC. 165.00 6.60 - 0 0 15 65,635 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,884.22 1.11 - 3 14,611 3 14,611 18 80,246 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 8,142.68 1.04 - 5 13,468 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 64,287.74 29.35 - 75 258,640 INTERNATIONAL BREWERIES PLC. 108,307.86 12.60 - 37 231,142 NIGERIAN BREW. PLC. 367,857.49 46.00 - 96 1,283,515 213 1,786,765 FOOD PRODUCTS DANGOTE FLOUR MILLS PLC 115,000.00 23.00 3.60 85 742,901 DANGOTE SUGAR REFINERY PLC 122,400.00 10.20 - 36 136,838 FLOUR MILLS NIG. PLC. 60,480.60 14.75 - 42 256,567 HONEYWELL FLOUR MILL PLC 7,850.90 0.99 - 19 225,231 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 0 0 NASCON ALLIED INDUSTRIES PLC 39,344.16 14.85 - 8 6,660 UNION DICON SALT PLC. 3,321.07 12.15 - 0 0 190 1,368,197 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 18,500.29 9.85 - 7 26,350 NESTLE NIGERIA PLC. 963,156.61 1,215.10 0.01 67 1,132,372 74 1,158,722 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 4,878.29 3.90 - 16 89,594 16 89,594 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 24,418.43 6.15 - 18 46,755 UNILEVER NIGERIA PLC. 153,391.64 26.70 - 22 57,437 40 104,192 533 4,507,470 BANKING ECOBANK TRANSNATIONAL INCORPORATED 132,116.77 7.20 -2.70 35 5,188,551 FIDELITY BANK PLC 47,808.42 1.65 0.61 71 4,866,647 GUARANTY TRUST BANK PLC. 790,227.16 26.85 0.19 156 14,467,641 JAIZ BANK PLC 14,732.12 0.50 2.00 16 1,287,176 STERLING BANK PLC. 56,141.32 1.95 - 79 4,347,339 UNION BANK NIG.PLC. 203,845.27 7.00 - 22 288,115 UNITY BANK PLC 7,364.28 0.63 - 7 92,803 WEMA BANK PLC. 22,758.93 0.59 -1.67 14 263,850 400 30,802,122 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 4,712.54 0.68 -1.45 23 871,525 AIICO INSURANCE PLC. AXAMANSARD INSURANCE PLC 17,850.00 1.70 6.25 28 1,022,589 CONSOLIDATED HALLMARK INSURANCE PLC 2,439.00 0.30 7.14 1 131,180 CONTINENTAL REINSURANCE PLC 23,857.31 2.30 1.77 16 1,078,700 CORNERSTONE INSURANCE PLC 5,744.51 0.39 - 4 242,400 909.99 0.20 - 0 0 GOLDLINK INSURANCE PLC GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 2,050.56 0.28 - 9 160,140 LAW UNION AND ROCK INS. PLC. 1,890.39 0.44 - 0 0 4,080.00 0.51 - 0 0 LINKAGE ASSURANCE PLC MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 0 0 NEM INSURANCE PLC 12,145.16 2.30 - 5 93,455 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,637.45 0.49 - 2 10,000 REGENCY ASSURANCE PLC 1,333.75 0.20 - 1 1,000 SOVEREIGN TRUST INSURANCE PLC 1,668.16 0.20 - 1 74 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 0 0 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 0 0 WAPIC INSURANCE PLC 4,683.96 0.35 - 21 323,045 111 3,934,108

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MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,721.10 1.19 - 4 23,095 4 23,095 MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,158.00 0.99 - 0 0 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 5,796.93 1.39 - 0 0 INFINITY TRUST MORTGAGE BANK PLC RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 8,000.00 4.00 - 35 961,097 CUSTODIAN INVESTMENT PLC 33,232.53 5.65 - 11 16,172 DEAP CAPITAL MANAGEMENT & TRUST PLC 660.00 0.44 - 0 0 FCMB GROUP PLC. 31,684.34 1.60 -0.62 71 8,052,261 ROYAL EXCHANGE PLC. 1,029.07 0.20 - 3 8,693 STANBIC IBTC HOLDINGS PLC 388,041.40 37.05 - 21 21,136 UNITED CAPITAL PLC 12,180.00 2.03 -4.69 56 3,775,404 197 12,834,763 712 47,594,088 HEALTHCARE PROVIDERS EKOCORP PLC. 1,680.29 3.37 - 0 0 852.75 0.24 - 1 20,000 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 1 20,000 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 494.58 0.50 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 8,241.12 3.95 9.72 22 368,592 GLAXO SMITHKLINE CONSUMER NIG. PLC. 8,490.72 7.10 - 9 65,309 MAY & BAKER NIGERIA PLC. 3,450.47 2.00 - 14 156,000 759.66 0.40 - 6 258,410 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 51 848,311 52 868,311 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 781.44 0.22 10.00 4 234,201 4 234,201 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 486.00 4.50 - 0 0 TRIPPLE GEE AND COMPANY PLC. 292.02 0.59 - 2 5,000 2 5,000 PROCESSING SYSTEMS CHAMS PLC 1,220.98 0.26 - 5 85,000 E-TRANZACT INTERNATIONAL PLC 9,996.00 2.38 - 0 0 5 85,000 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,157,510.66 308.00 - 1 100 1 100 12 324,301 BUILDING MATERIALS BERGER PAINTS PLC 2,173.68 7.50 - 16 53,015 CAP PLC 17,885.00 25.55 - 5 3,719 CEMENT CO. OF NORTH.NIG. PLC 199,781.21 15.20 - 6 10,622 MEYER PLC. 313.43 0.59 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 2.23 - 0 0 1,156.20 9.40 - 0 0 PREMIER PAINTS PLC. 27 67,356 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 2,430.62 1.38 - 12 116,825 12 116,825 PACKAGING/CONTAINERS BETA GLASS PLC. 26,898.49 53.80 - 3 162 GREIF NIGERIA PLC 388.02 9.10 - 0 0 3 162 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 42 184,343 CHEMICALS B.O.C. GASES PLC. 2,547.42 6.12 - 1 24,604 1 24,604 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 1 100,000 1 100,000 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 83.60 0.38 - 0 0 0 0 2 124,604 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 0 0 0 0 INTEGRATED OIL AND GAS SERVICES OANDO PLC 44,380.14 3.57 - 29 316,997 29 316,997 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 53,332.04 147.90 - 10 588 CONOIL PLC 10,686.86 15.40 - 17 24,269 ETERNA PLC. 4,108.06 3.15 - 6 57,000 FORTE OIL PLC. 20,839.70 16.00 - 20 10,974 MRS OIL NIGERIA PLC. 5,166.13 16.95 - 5 7,775 TOTAL NIGERIA PLC. 41,829.09 123.20 - 12 8,480 70 109,086 99 426,083 ADVERTISING AFROMEDIA PLC 1,820.01 0.41 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 17,551.17 1.80 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 294.09 0.25 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,387.46 4.05 - 7 28,250 TRANS-NATIONWIDE EXPRESS PLC. 361.01 0.77 - 0 0 7 28,250 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,723.78 3.05 - 0 0 IKEJA HOTEL PLC 2,452.98 1.18 - 2 60,440 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 41,042.18 5.40 - 0 0 TRANSCORP HOTELS PLC 2 60,440 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,800.00 0.40 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 211.68 0.35 - 1 1,300 LEARN AFRICA PLC 948.88 1.23 - 6 29,560 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 496.12 1.15 - 6 9,421 13 40,281 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 729.39 0.44 - 3 70,000 3 70,000

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BUSINESS DAY Tuesday 15 October 2019 www.businessday.ng

Nnaemeka Ikegwuonu: Lessons in penetrating a new market isaac anyaogu

Nnaemeka Ikegwuonu enlightened them about the benefits of improved seedlings, how to apply fertilizers and the best kind for the soil. He warned of the dangers of primitive practices including bush burning. He began a programme in a local radio station and even published a pamphlet in the local language filled with pictures that aided comprehension to explain better farming practices. It took time and effort but it paid off. The farmers’ yield began to improve. An independent study found actual revenue grew by two-fold. But then there was a new problem. How do they store all these improved harvest in a sustainable way? Naturally, they turned to the guy who helped them improve their yield in the first place. Since, he has convinced them his methods, while strange are effective, perhaps they could trust he knew what he was saying about putting tomatoes in a fridge! Within months, ColdHubs cannot build enough cold rooms to meet the demand. Each ColdHub is filled with150 crates everyday across all the company’s operational sites and it has had to turn down orders. “When we started this work, we received about two to three baskets of tomatoes every day while in some we received one basket, however today we have been able to achieve more,” Ikegwuonu said in an interview BusinessDay. ColdHubs have also created new jobs for women by recruiting and training them to be hub operators mad market attendants in the markets and is also deploying 35 new cold rooms which will serve an

estimated 3,500 farmers, wholesalers and fishermen. Ikegwuonu says his vision is to scale the business as it looks to deplore more cold rooms. “We are building our own ColdHubs 100 percent,” he said On the issue of technology transfer, the young entrepreneur said that too is happening in the Nigerian off-grid space but al lot still needs to be done. “The research institutes in the

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ith at least 45 percent of postharvest loss, the challenge of preserving produce contributes to the absence of food security in Nigeria. It is in this space, a young entrepreneur, Nnaemeka Ikegwuonu, sought to provide solution. Ikegwuonu’s start-up, ColdHubs is helping farmers and market vendors become more profitable by eliminating food waste through solar-powered walk-in cold rooms. Registered in 2015, ColdHubs is producing cold rooms and selling the space to smallholder farmers, retailers and wholesalers to store and preserve fresh fruits, vegetables and other perishable foods. The energy efficient monoblock refrigeration unit is connected to an inverter that enables the solarpowered batteries to supply energy for night cooling. Each ColdHub can fit approximately three tonnes of perishable food, arranged in at least 150 units of 20kg plastic crates stacked on the floor. It started as a small Holder’s Foundation in 2018 but after securing funding, from the MIT Solve initiative and the Microsoft Airband Grant Fund, he built a simple solution made up of 120mm thick insulating cold room panels to retain cold, with energy provided by solar panels mounted on the roof. ColdHubs launched in December 2016 and became commercially operational on March 8 2017. It achieved fill up (selling out all its spaces) in August 2017. It has deployed about 35 ColdHubs in different parts of Nigeria to store produce and preserve fish. A very interesting piece of Ikegwuonu’s entrepreneurship journey and which qualifies it for profile in BusinessDay leadership series is the lesson it offers in penetrating new markets. When he set out, market women believe you it is inappropriate to put tomatoes in a fridge because it will spoil. This belief, even though lacking any scientific basis was widely accepted in rural areas where Ikegwuonu sought to launch his business. So how do you overcome this objection and get the people to buy into your message? How do you convince rural folks, many without any formal education and steep in traditional practices to abandon false notions? Penetrating new markets Ikegwuonu’s strategy was to first earn their trust. So, he didn’t go into building solar cold rooms right away but started educating the local people on how to improve their yield through modern farming methods. He organised classes and visited many farms providing free extension services that ran the gamut of the crop planting process. He

The point is the regulatory environment does not encourage small and medium scale enterprise in any way, because you are going to pay a huge sums of money to clear goods which you could have use to support the deficient power sector in Nigeria

West and Chinese manufacturers are inventing every day, so you will discover that your solar installer has a skill set that its best fit for the 1990s which can’t be applicable in 2019 and more so research institutes in Europe and Asia are turning out new products and research for 2025 and 2030 which we need to localize. “Some of us are into the business of building and operating we cannot have that ability to transfer that skills. We hire that solar technicians every now and then and we find out that some of them don’t know what it’s going on so we need to pick training as a business just the same way Lagos business school strives on entrepreneur someone has to do same for Offgrid sector. Good business practices One important factor accounting for Ikegwuonu’s success is the ability to convince investors of your solutions and building corporate governance practices early on in the business. “One cold hub cost $27,000 to build which include cost of power infrastructure, solar panels, battery, inverters, shipping, clearing from custom and bringing from Onne seaport which will move to our warehouse and many more. “However, if you are able to fill that cold room up from day one you can generate that income within 12 months but considering the fluctuations in currency and foreign exchange, with one ColdHubs you can breakeven in 24 months (two years) that’s is giving room for foreign exchange challenges and so on,” Ikegwuonu said. As it is true for many entrepre-

neurs, Ikegwuonu, though with a degree in history and international studies, operates in the agricultural sector. H parents were farmers so he grew up in farms and this was where the interest in agriculture came from. Yet he resisted every attempt to formally study it in the University. “Everything was done at the family level to push me to study agriculture, I resisted because my parents wanted me to study Agric Economics or Agric Engineering. I resisted because I felt as a young man then that there is the notion of farming not being attractive hence associated with poverty.” “So, I decided to go into the arts to study history in Imo state university although, I wanted to go into Journalism in University of Nigeria but I didn’t make the cut. What I have learnt is, yes you can change your course or academic pursue but you can’t change who you are because the desire and interest will always come out.” As it is true for every business in Nigeria, challenges abound. His biggest challenges come from the regulatory authorities. “We have a 40 feet container filled with batteries in Onne port and part of our challenges is that we pay 20 percent duty on those batteries; we also pay duty on imported solar and imported inverter. “The point is the regulatory environment does not encourage small and medium scale enterprise in any way, because you are going to pay a huge sums of money to clear goods which you could have use to support the deficient power sector in Nigeria or support National development, because it’s actually power that drives the economy or key to industrialization. “Unlike everywhere else in the world were its always friendly, regulatory environment seems harsh in Nigeria and when I talk about regulation I am not talking about Nigerian Electricity Regulatory Commission (NERC) or the Ministry of Power, I am taking about this little agencies that we interface with every day in the course of doing business. “For example, from Kano to Owerri there are more than 30 checkpoints from touts, community youths, police, civil defense among others waiting to harass businessmen. So, it’s like everybody is against a businessman. Frankly speaking it’s very difficult to do business in Nigeria and the government can do better by easing the ease of doing business by making policies and program friendly. Ikegwuonu said the second phase of the compnay’s development is food logistics, which involves bringing food in a safe and hygienic model from the north to the southern part of Nigeria and also takes apples and grapes imported from South Africa from the southern part of Nigeria up to the northern part of Nigeria.

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