BusinessDay 16 Apr 2020

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Biggest Gainer Dangcem

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Biggest Loser UBN

10.00 pc NN6.5 22,539.94

N121

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Bitcoin

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-4.62 pc

Foreign Reserve - $34.4bn Cross Rates GBP-$:1.29 YUANY - 54.69 Commodities Cocoa US$2,229.00

Gold $1,718.32

news you can trust I ** thursDAY 16 april 2020 I vol. 19, no 543

Stocks jump by most since early January as Dangote Cement gains 10% SEGUN ADAMS

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igerians stocks extended gaining streak Wednesday after bellwether stock Dangote Cement gained a maximum 10 percent to push the market by the most since the start of the year.

The main equity gauge NSE All-Share Index rose 3.02 percent, its fifth straight gain and longest since the start of 2020.

Wednesday’s gain is the second biggest since 3.54 percent on January 8 and comes despite the continued decline in Brent price, lockdown in major states and rise in COVID-19 cases in Nigeria.

Gbolahan Ologunro, analyst at CSL Stockbrokers, said fundamentals driving stock gains are unclear but investors could be taking advantage of cheap valuations in the market.

He said banking stocks like Zenith and GTB are trading at a deep discount to their intrinsic value, while renewed interest in Dangote Cement might be due to market expectation that a part of the proceeds from its bond raise would be used for share

₦2,742,341.29 -0.57

N300

Sell

$-N 410.00 417.00 £-N 483.00 500.00 €-N 423.00 440.00

Crude Oil $ 27.42

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Market

Spot ($/N)

3M 0.00 2.17

I&E FX Window CBN Official Rate

385.63 361.00

Currency Futures

NGUS mar 31 2021 392.50

($/N)

fgn bonds

Treasury bills

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6M 0.00 2.94

5Y 0.00

10.96

NGUS mar 29 2023 401.57

@

10 Y -0.22

30 Y 0.06

12.05

12.61

NGUS mar 26 2025 411.86

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Worst recession since 1987 means Buhari’s poverty rollback vow a mirage For ordinary Nigerians life will get bleaker

TEMITAYO AYETOTO, SEGUN ADAMS & OLUFIKAYO OWOEYE

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efore 2016, Kehinde Odekhian was a 36year old inventory manager at an FMCG firm in Lagos. However, his fortunes changed for

the worse in the wake of a recession that year after he got laid off due to a downturn in the economy.

“The company I was working for said they wanted to downsize and I was among the unlucky ones,” Odekhian, who now sells goods in a small provision shop,

told BusinessDay. “I felt like dying.”

Odekhian now earns just 33 percent of what he used to earn as a manager, but said he is faring better than most of his colleagues that are yet to find their feet.

With warnings by the Inter-

national Monetary Fund (IMF) of a looming global recession induced by the coronavirus disease outbreak, Odekhian and many in fragile informal sector jobs are at risk of sliding into the class of extremely poor again.

Continues on page 29

Continues on page 29

Inside Nigerian impact investor All On announces moratorium on loan interest payment P. 2

Babajide Sanwo-Olu, governor, Lagos State, briefing journalists after the State Security Council meeting at Lagos House, Marina. With him are, L-R: Hakeem Odumosu, Commissioner of Police, Lagos Command; Akin Abayomi, commissioner for health; Moyo Onigbanjo, attorney general/ commissioner for justice; Gbenga Omotoso, commissioner for information and strategy; Ibrahim Aliyu Shettima, commander, Nigeria Navy Ship (Beecroft), Apapa; Etsu Ndagi, commander, 9 Brigade, Ikeja Army Cantonment, and Rasaq Olanrewaju, commander, 651 Base Services Group, Nigerian Air Force Base, Ikeja.

Experts call for more private sector role for Nigeria post COVID-19

... as BusinessDay holds 2nd digital dialogue LOLADE AKINMURELE & FRANK ELEANYA

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igeria’s well-known economic challenges have been exposed by the COVID-19 crisis, but the country has a chance to put it right when the dust settles on the pandemic by giving a larger role to the private sector,

experts said Wednesday.

The experts, who spoke during the 2nd edition of the MTNBusinessDay Digital Dialogue, outlined the direction Nigeria’s economy needs to take to shake off the corrosive impact of the pandemic and also prepare the country for life after the virus has ended.

The webinar, organised by BusinessDay, Nigeria’s premier source of financial and business intelligence, in conjunction with telecommunication giant MTN Nigeria, was moderated by Enase Okonedo, professor and dean, Lagos Business School.

During the webinar titled “The National Economic Emer-

gency: What should policymakers in Nigeria do to avert a potential depression and get our economy on the road to recovery post COVID-19?”, most of the suggestions revolved around a more private sector-driven economy with less government intervention and more investment in infrastructure, particu-

larly health and education, not only by the government but also by private sector.

“The Covid-19 pandemic is a wake-up call for Nigeria to implement the right mix of reforms,” said Kyari Bukar, former chairman, Nigerian Economic Summit Group (NESG).

Bukar hopes this health crisis caused by the pandemic pushContinues on page 2

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COVID-19: Community spread now point of worry as cases rise

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octorsatthefrontline of the fight against the deadly coronavirus in Lagos say the rate of community spread of the virus in Africa’s largest city has risen to about 45 percent of the total number of cases.

“At the beginning we were dealing with a ratio of 80:20, 80 being those with a travel history while only 20 percent of the cases fell into the category

of community spread. Today, that number has gone up to 45 percent,” said one doctor who spoke to our reporter but did not want to be identified.

“One thing positive is, most of the cases doctors are seeing are people who are a lot less ill, they are being taken in not because they are ill but so they can be isolated to curb

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Experts call for more private sector...

Continued from page 1

es Nigeria “to open the economy up to the private sector and reduce government’s stranglehold and over-regulation in some sectors of the economy”.

One of such sectors is the oil and gas sector, the country’s cash cow which contributes around half of the government’s annual revenues. The Petroleum Industry and Governance Bill, a piece of legislation that’s mainly supposed to stimulate more private sector investment into the oil and gas sector, has stalled for decades while other countries have since moved to capitalise on Nigeria’s fiscal inertia.

Imo Itsueli, former chairman of state oil company, NNPC and founder of Dubri Oil, who knows more than many about Nigeria’s oil sector, said the economy should be allowed to run the show while the government sets the rules.

“There are many things we have not done well and continue to do badly in the oil and gas sector,” Itsueli said.

He said that Nigeria has continued to produce below 2 million barrels of oil a day because it lacks investments required to ramp up production. The investments have stalled because the country has failed to enforce the required reforms that will attract investments. The failure to stimulate investment has come at the cost of economic growth which has been negative in per capita terms despite an exit from recession in 2016.

The economy could contract by as much as 3.4 percent in 2020, according to estimates by the International Monetary Fund (IMF). That would be the most in three decades, as Nigeria’s already frail economy is hammered by the COVID-19 pandemic which is sending shock waves across the world.

According to Atedo Pe-

terside, founder of Stanbic IBTC Bank and chairman of the ANAP Foundation COVID-19 Think Tank, Nigeria made five crucial mistakes in the fight against the pandemic.

These mistakes include underestimating the coronavirus threat, allowing international flights to come in and not shutting the country’s airspace on time, and the country’s limited testing ability.

The other two mistakes are having a large informal and disorganised society which makes it difficult to track people as well as the inability to look after the poor and handicapped in society, estimated at 80 million people.

These mistakes can be corrected if “we have a general elite consensus that we need to take care of the poor”, Peterside said.

“It is important to look after the poor at this time than anything else,” he said.

He warned that the pandemic fight is not a money fight; it is beyond throwing money to incentivise businesses to jumpstart the economy.

Chidi Odinkalu, professor of Law and former Executive secretary, Nigeria’s Human Rights Commission, was critical of the government’s role in curtailing the spread of the pandemic.

“Nigeria has lacked leadership at this critical time and that is clear with our lack of well thoughtout strategy to manage the spread of the virus,” Odinkalu said.

He asked for the presidential task force to be disbanded because it’s full of politicians and propagandists.

“It won’t persuade people to take the government seriously. The task force should have more representation of technocrats and health experts,” he said. www.businessday.ng

Nigerian impact investor All On announces moratorium on loan interest payment ... AfDB recommends move for other impact investors ISAAC ANYAOGU

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igerian off-grid impact energy investing company, All On, has announced a postponement of all Q2 2020 interest payments on current interest-bearing investments.

This decision was taken in recognition of the continued economic impact of the COVID-19 pandemic and in line with the company’s mandate to accelerate the growth of the off-grid energy sector in Nigeria.

“As the world grapples with the threat of the disease, institutions are also struggling to stay alive. We recognise that our investee companies must first survive this downturn in

order to sustainably meet their commercial commitments to us,” said investment manager, Afolabi Akinrogunde.

Beneficiaries of the moratorium include All On investees, spanning the spectrum of the off-grid clean energy value chain.

“We are answering the call from global leaders to put business strategy aside and act in the best interest of the sector. We can and are doing more to support our investees during this difficult time,” said All On CEO, Wiebe Boer.

Commenting on the debt payment postponement, Akinwumi Adesina, president, African Development Bank, said, “I am pleased to see that All On is taking my

recommendation to avoid fiscal distancing seriously and has deferred debt payments for its investees across Nigeria.

This is an example for other impact investors across Africa to follow.”

All On earlier announced the COVID-19 Solar Relief (CSR) Fund in March, which made available N180 million to four off-grid energy companies to provide solar power to emergency health facilities in cities around Nigeria, through various private sector initiatives. The four companies, Arnergy, Auxano, GVE, and Lumos, are All On investees. The first solar plant under the CSR Fund is already operational at the National Orthopedic Hospital in Ig-

bobi, Lagos. The installation was completed by Auxano Solar under a partnership with FATE Foundation. Other deployments will be delivered over the next two weeks.

All On’s main objective is to contribute to addressing Nigeria’s access to energy gap through impact investing and the creation of an enabling environment for players in the off-grid sector to thrive.

Through the COVID19 Solar Relief (CSR) Fund, All On is contributing to interventions nationwide by providing a green power solution to aid in the containment and treatment of the virus, while also creating awareness of solar power for the development of the Nigerian economy.

Solar installation completed by Auxano Solar in partnership with the FATE Foundation and funded by the All On Covid-19 Solar Relief Fund is now operational at the isolation centre set at the National Orthopedic Hospital, Igbobi, Lagos.

Oil slumps below $20 as IEA estimates global demand to drop by 9.3m bpd in 2020 DIPO OLADEHINDE

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il fell below $20 a barrel on Wednesday after the International Energy Agency (EIA) said it expects global demand in 2020 to fall by 9.3 million barrels a day, with countries around the world effectively having to shut down in response to the coronavirus pandemic.

In its closely-watched monthly report released on Wednesday, the Paris-based agency said activity in the transportation sector has fallen dramatically almost everywhere, noting that confinement measures had been implemented in 187 countries and territories in response to the coronavirus outbreak.

“Even assuming that travel restrictions are eased in the second half of the year, we expect that global oil demand in 2020 will fall by 9.3 million barrels a day versus 2019, erasing almost a decade of growth,” IEA said on Wednesday.

Oil prices, which were already trading slightly lower Wednesday morning, extended their losses shortly after the report was published.

U.S. West Texas Intermediate (WTI) stood at $19.77, down around 1.7 percent, while International benchmark Brent crude traded at around $28.74 a barrel, down more than 2.8 percent.

WTI futures closed more than 10 percent lower in the previous session, settling marginally above $20 a barrel,

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while Brent settled almost 7 percent lower on Tuesday, slightly below $30.

Also, Brent, the benchmark for two-thirds of the world’s physical supply, was assessed at $20.66 on Tuesday, compared with $23.73 last Thursday, according to S&P Global Platts.

Oil has lost about two-thirds of its value this year as countries extend their coronavirus lockdowns, death tolls mount around the world, and unemployment explodes in America.

The International Monetary Fund estimated the global economy will shrink 3percen this year, a signal that energy demand may remain weak, while the IEA is warning that the worst may be yet to come.

IEA noted that a global @Businessdayng

pact to cut production led by Organisation of Petroleum Exporting Countries (OPEC) and allies members may not be enough to rebalance the market in the near-term but could aid a quicker recovery in the second half of 2020.

IEA said demand in April is estimated to be 29 million barrels per day lower than a year ago, hitting a level last seen in 1995 while in the second quarter of the year, oil demand is expected to be 23.1 million barrels per day below year-ago levels.

While recovery is forecast to be underway in the second half of the year, the IEA said it expects this to be gradual and, in December, demand will still be down 2.7 million barrels per day year-on-year.

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How African economies can survive Covid-19 meltdown - ECA JOSHUA BASSEY

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conomic Commission of Africa (ECA) says African countries will need to quickly develop policy responses that take cognizance of their vulnerability as it relates to productivity, jobs and revenues in defining stimulus to mitigate national and regional economic impacts of the Covid-19 pandemic on the continent.

“As engines and drivers of economic growth, cities face considerable risks in light of Covid-19 with implications for the continent’s resilience to the pandemic,” says Thokozile Ruzvidzo, director of the gender, poverty and social policy division of the ECA.

GDP in Africa expected to be hit hard by Covid-19 related effects, leading to substantial losses in productive jobs.

The ECA observes that the approximately 250 million Africans in informal urban employment (excluding North Africa) would be at risk. The commission further explains that firms and businesses in African cities were highly vulnerable to Covid-19 related effects, especially small, medium enterprises which account for 80 percent of employment in Africa.

“These risks compounded by a likely hike in the cost of living are expected as shown, for example, by some initial reports of up to 100 percent increase in the price of some food items in some African cities.”

According to ECA, African cities are home to 600 million people and account for more than 50 percent of the region’s gross domestic product (GDP).

This is even higher at more than 70 percent for countries such as Botswana, Uganda, Tunisia and Kenya.

A third of national GPD (31%) comes on average from the largest city in African countries. As such, the economic contribution of cities in the region is far higher than their share of population, says Ruzvidzo.

She notes that Covid-19 employment effects are likely to be severe in urban areas with urban-based sectors of the economy (manufacturing and services), which currently account for 64 percent of

BEDC increases daily power supply to cushion Covid-19 effect IDRIS UMAR MOMOH, Benin

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anagement of Benin Electricity Distribution Company (BEDC) plc says it has increased daily power supply to customers across its franchise states to cushion the negative effects of government’ lockdown occasioned by the Coronavirus pandemic outbreak.

The franchise states of the electricity company are Edo, Delta, Ondo and Ekiti.

A statement signed by Adekunle Tayo, head, corporate affairs, BEDC, made available to newsmen in Benin City, said the increase in the power supply would be in force till the COVID-19 pandemic lockdown ebbed away.

Tayo, who however, assured that the increase could only be affected by technical faults or other untoward circumstances in the power value chain added that it would strive to rectify faults as quickly as possible.

He said the development that began last week was occasioned by the tacitly suspending the rotational load management schedule for power supply to some of customers by the company.

He added that the power supply was increased from the initial six hours to 18 hours as well as 12 hours and 10 hours to 24 hours daily.

“As a demonstration of its sensitivity to residents of its franchise states who are on lockdown over the Coronavirus (COVID 19) pandemic, BEDC

Electricity plc, has increased significantly, power availability to several customers in some locations, even at it has commenced the process of boosting the present grid power with additional power supply source through embedded generation.

“The increase in power supply to some areas was made possible due to the shutdown of commercial and industrial activities with the limited power normally utilised by these class of customers now redirected for residential use.

“The national grid remains the major constraint to BEDC increase in power supply as it is what we get from the grid that we distribute to all sectors in our network”, he said.

Lagos rolls out palliatives, transfers cash to indigents

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agos State government, on Tuesday, introduced a scheme to cushion the effect of the ongoing lockdown of the state on its residents. The new palliatives were rolled out

by Governor Babajide SanwoOlu less than 24 hours after President Muhammadu Buhari, in a nationwide broadcast on Monday night, extended the cessation of movement in Lagos, Ogun and the Federal Capital Territory (FCT).

Sanwo-Olu announced the social intervention programmes during a briefing that followed Security Council meeting held at the StateHouseinMarina,onTuesday.

The new scheme came on

… feeds 100,000 youths daily the heels of the commencement of the second part of Food Stimulus Packages being distributed to 250,000 vulnerable residents since the lockdown directive came into effect.

The governor disclosed that the state was moved by the need to support and ameliorate the inconvenience being experienced by vulnerable people as occasioned by the extended lockdown.

The government is opening food kitchens in all the local councils in the state with a target to provide one meal per day to 100,000 youths. Sanwo-Olu also

announced unconditional cash transfer of undisclosed amount to 250,000 vulnerable residents and economically challenged persons who have identification numbers with Lagos State Residents Registration Agency (LASRRA).

Besides, the governor granted three months moratorium to Micro, Small and Medium Enterprises (MSMEs) and entrepreneurs that got repayable loans from Lagos State Employment Trust Funds (LSETF), deferring the payment of accruing interests by the loan beneficiaries.

Dollar trades N416 at black market amid scarcity Hope Moses-Ashike

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igeria’s currenc y on Wednesday exchanged for an average rate of N416 per dollar, depreciating by N4 compared to N412/$ traded in April 1, 2020, at the black market.

Investigation shows that dollar is currently trading at N417 at Eko Hotel Lagos, while it trades at N415 in Apapa and other states like

Kano and Kaduna.

BusinessDay gathers that dollar is scarce and some of the black market operators are not trading due to the Covid-19 lockdown.

One of the dealers who have some dollars to sell said he sourced dollar from individuals who contact him.

“I am not trading but I learnt dollar is selling at N415,” one of the black market operators in Festac told BusinessDay. www.businessday.ng

The Central Bank of Nigeria (CBN) on March 26, 2020, suspended foreign exchange sales to the Bureau De Change (BDC) operators until further notice.

At the Investors and Exporters (I&E) forex window, naira closed at N386.63k per dollar on Tuesday after the Easter holiday, losing N1.80k compared with N384.83 per dollar traded on Thursday last week, data from FMDQ indicated. https://www.facebook.com/businessdayng

@Businessdayng

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Covid-19: CRPP says Sanwo-Olu demonstrated capacity for leadership Joshua Bassey

… as Lagos records 8 Covid-19 death

onference of Registered Political Parties (CRPP) has sought greater support for the government of Lagos State in its effort to contain the spread of the Coronavirus pandemic. The CRPP also lauded Governor Babajide Sanwo-Olu for standing up at this trying period and reeling out measures to curtail the killer virus and lift residents from the burden of the current lockdown.

Chairman of CRPP, Taiwo Fatai, at a news conference in Lagos, Wednesday, said Sanwo-Olu deserved praise for his efforts. “We commend Governor Babajide

Olusola Sanwo-Olu for the steps he is taking to stop the spread of Covid-19 in Lagos. His motivating, proficient and consoling reaction to the pandemic is highly commendable.

“We are satisfied with his response to the dictates of the times, by reactivating Lagos State profile banking and bio-security research facility at the infections sickness laboratory at Yaba.

“The events that have lockeddown nations of the world have vindicated our assertion that Babajide Olusola Sanwo-Olu embodies the true yarning and aspiration

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of the people of Lagos State.”

The group also praised the commissioner for health, Akin Abayomi, saying, “The professional touch he has brought to bear in fighting the Covid-19 scourge is commendable.”

The CRPP urged Lagosians to support the Sanwo-Olu’s administration in the fight against the pandemic by complying with all instructions to stamp it out of the state.

Meanwhile, the state has recorded its eighth Covid-19 death.

Commissioner for health, Akin Abayomi, who announced the death via his twitter handle, said

the dead was a 63-year-old male, Nigerian who had no history of travel or contact with any confirmed case. “With this, total #Covid-19 related deaths in Lagos now stand at 7. Let’s all stay home,” Abayomi said.

Also, the Nigerian Medical Association (NMA) has confirmed the death of Chugbo Emeka, a medical doctor at the Lagos University Teaching Hospital (LUTH).

Emeka, according to NMA, died on Wednesday at the LUTH isolation treatment ward where he was on admission. “Until his death, he was a private medical practitioner who was exposed to a confirmed case of COVID-19.

L-R: Desmond Akawor, Rivers State PDP chairman/chairman, Rivers State Covid-19 Palliatives Committee; Chamberlain Oguzo, human resources manager, Crown Flour Mills (an Olam Group Company); Ohia Prince Obi, commissioner for Youth Development, Rivers State, and Suresh Raju Thilagar, general manager, Crown Flour Mills, Port Harcourt plant, during the presentation of relief materials to the Rivers State government in support of the fight against Covid-19 at the State House, Port Harcourt,

SystemSpecs supports national Covid-19: FCTA begins distribution Covid-19 response with N100m of palliatives Friday

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ndigenous fintech and human capital management firm, SystemSpecs, has announced the donation of N100 million towards efforts by government and other stakeholders to manage the COVID-19 pandemic in Nigeria.

The amount includes cash donations to Federal and State governments, provision of a complete COVID-19 test system as well as direct intervention to help keep government operations running during the lockdown.

Commenting on the initiative, John Obaro, managing director of SystemSpecs, said: “The quick containment of the COVID-19 pandemic requires well-meaning Nigerians and organizations to support the efforts of government and other stakeholders; as a responsible corporate citizen, our organization is doing this through a range of measures.

It is imperative for everyone to lend a helping hand in whatever way they can as nothing is too small at a time like this.”

According to the organisation, the amount includes a donation of N50 million to the Federal Government through the Central Bank of Nigeria (CBN) coordinated initiative; cash donation to states across the geo-political zones; procurement of an advanced COVID-19 test system for the International Foundation Against Infectious Diseases in

Nigeria (IFAIN) for installation at its Kano laboratory, and technology support (computers and internet subscriptions) to enhance remote working by state government officials responsible for critical operations.

In addition, SystemSpecs working in partnership with the Federal Government, CBN and states, has provided a platform for individuals and corporate entities in Nigeria and Diaspora to donate towards the fight against COVID-19.

Donors are to visit www.remita.net to make “COVID-19 Donation” through the use of USSD, cards, internet banking, wallets and also mobile apps.

Demola Igbalajobi, executive director, public sector and special projects division of SystemSpecs, said: “One of the fallouts of this pandemic is its impact on governance and the workplace in general, during this lockdown and beyond.

This initiative is designed to support remote working of government officials with technology as an enabler, thereby ensuring the continuity of critical government operations that will reduce the hardship on citizens during this period.’’

The 28-year-old SystemSpecs is a pioneer of innovative financial and human capital management technology in Nigeria including the very popular Remita platform. www.businessday.ng

... insists on enforcement of sit-at-home order James Kwen, Abuja

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he Federal Capital Territory Administration (FCTA) will this Friday begin the distribution of palliatives to the vulnerable in the FCT to cushion the harsh effects of the Covid-19 pandemic on them.

FCT minister of state, Ramatu Aliyu, who announced this during a stakeholders’ meeting with graded chiefs in the six Area Councils as well as representatives of religious and political leaders in the territory, said the exercise would commence in Abaji Area Council.

Aliyu stated that the FCT Administration would ensure strict compliance of the presidential sit-at-home order in each Area Council to pave way for a hitchfree distribution of palliative items to the vulnerable in rural communities.

She said the decision to begin with Abaji was to test-run the palliative distribution with regards to security personnel and logistics so as to improve on any identified mistake in subsequent Area Councils.

The minister asked the Council chairmen, traditional rulers and the religious leaders to suggest the best way that the palliative items would reach those who genuinely need them in their domains at this critical period of the sit-at-home direc-

tive of the Federal Government.

“In our wisdom, considering the daunting task of our royal fathers, considering the responsibilities vested on you, we have come to a stage where we have to sit down with you and rob minds together on how to reach-out to our people.

“The reason for this meeting today is to discuss the burning issue of the palliative distribution to our people seamlessly and the strategy we have adopted. Hopefully, after this pandemic, we will come out stronger.

“By the grace of God, we are ready to go. We felt this is the right time to discuss with our royal fathers on the modalities of distribution. We want to seek your advice from your reservoir of knowledge and wisdom to guide us properly.

“However, we don’t want to expose people to the danger of COVID-19 in the guise of sharing palliative. Therefore, we have drawn up our strategy. It is propose that the palliative will commence in Abaji on Friday, April 17, 2020.

“Abaji is targeted because it has the smallest population and one of the poorest area councils in the FCT by our data.

The outcome of Abaji distribution will enable us evaluate our performance. During the distribution, the security will be mobilized and lockdown each area council to enable us move from house to house”, she said.

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Rensource’s digital distribution platform to connect SMEs to customers at lockdown Segun Adams

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ensource, Nigeria’s provider of critical merchant infrastructure, has launched Merchlist.co - a digital platform that helps small and mediumsized retailers get discovered quickly while enabling servicing and fulfilment of customer orders online.

The Merchlist.co platform was rapidly developed as a solution to keep SMEs viable during the COVID-19 pandemic and has two main features: BUY – which allows customers purchase directly from SMEs, and DISCOVER – which aggregates services, contact details and delivery methods, ensuring that end users can see service availability in real-time.

Partner SMEs on Merchlist. co include Grocery Bazaar, Grand Square, Rx Pharmacy, Food Jaar, and The Meat Shop. While the platform is currently in its beta testing stage, only accepting a limited number of orders per day, plans are underway to roll out in additional markets across Nigeria– allowing more SMEs and merchants to go digital and access end-users.

Rensource’s mission has always focused on enabling access to critical services: initially to energy, it’s now broadening that range. This new addition to its

product portfolio is consistent with the company’s mission, providing access to essential items including groceries, toiletries, beauty and cleaning products, all at the touch of a button.

“At Rensource we are focused on connecting people to the most important things. Energy has always been our core business but in light of the pandemic, we see the opportunity to help small businesses who are the backbone of our economy survive by gaining access to consumers online. The launch of Merchlist will ensure that small businesses stay in business and everyday consumers can continue to access essential goods. Merchlist aims to connect as many small businesses as possible to the millions of internet users in Nigeria– simply, easily and quickly,” said Anu Adasolum, chief operating officer at Rensource on the launch of Merchlist.co.

“We have also launched a fund to support our merchant families during this period. Donations by Merchlist is providing food, essentials and medical supplies to these families through our partner NGOs, Lagos Food Bank, Foundation for the Support of the Less Privileged and Dream from the Slum. We know that we cannot do this alone and are calling on wellmeaning Nigerians to contribute by visiting donations.merchlist. co,” Adasolum said.

Emirates commences on-site rapid COVID-19 tests for passengers IFEOMA OKEKE

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mirates Airline in coordination with Dubai Health Authority (DHA) has introduced additional precautions to avoid spread of COVID-19 by conducting onsite rapid COVID-19 tests for passengers.

Passengers on Wednesday flight to Tunisia were all tested for COVID-19 before departing Dubai.

The quick blood test was conducted by the DHA and results were available within 10 minutes. This test was conveniently done at the Group Check-in area of Dubai International Airport Terminal 3.

Adel Al Redha, Emirates chief operating officer, said: “The testing process has gone smoothly and we would like to take this opportunity to thank the Dubai Health Authority for their initiatives and innovative solutions. This won’t have been possible without the support of Dubai Airport and other government authorities.

“We are working on plans to scale up testing capabilities in the future and extend it to other flights, this will enable us to conduct on-site tests and provide immediate confirmation for Emirates passengers travelling to countries that require COVID-19 test certificates. The health and safety of staff and passengers at the airport remain of paramount importance.”

Humaid Al Qutami, director-general, DHA, said: “We are glad to work with Emirates on the successful implementation of rapid COVID-19 testing at the airport for departing travellers.

“To tackle COVID-19, we have been proactively working with various governmental @Businessdayng

organisations and the private health sector and we have implemented all necessary measures from public health protection to provision of highquality health services in line with the latest international guidelines. We believe strongly that the most effective solutions require close partnerships with other public and private sector organisations.”

The airline’s check-in and boarding formalities have also been adapted with social distancing in mind. Protective barriers have been installed at each check-in desk to provide additional safety measures to our passengers and employees during any interaction. Gloves, masks and hand sanitisers have been made mandatory for all employees at the airport.

Passengers are also required to wear their own masks when at the airport and on board the aircraft, and follow social distancing guidelines. Emirates has modified its inflight services for health and safety reasons.

Magazines and other print reading material will not be available, and while food and beverages will continue to be offered on board, packaging and presentation will be modified to reduce contact during meal service and minimise risk of interaction. Cabin baggage is currently not accepted on flights.

Carry-on items allowed in the cabin are limited to laptop, handbag, briefcase or baby items. All other items have to be checked in, and Emirates will add the cabin baggage allowance to customers’ check-in baggage allowance.

All Emirates aircraft will go through enhanced cleaning and disinfection processes in Dubai, after each journey.

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Thursday 16 April 2020

BUSINESS DAY

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Thursday 16 April 2020

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The next 14 days in Nigeria The Public Sphere

CHIDO NWAKANMA

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fter choosing health over economics, President Muhammadu Buhari and his Presidential Task Force on Covid19 have set a high bar of expectations. Citizens want to know what happens in the next 14 days following the extension of the lockdown on Lagos and Ogun States as well as the FCT. How would the management of the coronavirus response and citizen welfare be different from the first 14 days?

For many citizens, the sacrifice that PMB has demanded is a choice between covid19 versus hunger. The majority will easily comply with the guidelines on social distancing, washing with soap and water for at least 20 seconds, never touch their faces, isolation, sneeze into elbows or tissues and wear masks or other protective equipment. The economic challenge is not so easily tackled, what with shut factories, banks and opportunities to earn income.

The government may have followed global best practice and bought time with the extension. Citizens see the

extension the other way. They see it as the period that the federal government needs to put things right with the containment of the coronavirus and management of the economy. They cannot wait for the reopening of the economy.

Great expectations lie in the minds of citizens for the next 14 days, and their focus is the Federal Government represented by the Presidential Task Force on Covid19. PTFCovid19 would need to do things and communicate them so it earns the trust and confidence of Nigerians.

Here are the critical areas.

Increased test numbers Nigeria is ninth in the Top Ten league of coronavirus testing by African countries. We are only slightly ahead of Uganda. PTFCovid19 and the Ministry of Health have a call to deliver a minimum of 21,000 additional tests by 27 April. It works out at the 1, 500 tests daily that PMB says Nigeria now can deliver. By 27 April, therefore, citizens expect that Nigeria’s test numbers should be reading between 26,000 to 30,000.

The question arising is would that number be anywhere near enough?

What percentage of the population need to be tested to establish an adequate and representative sample?

Who determines the baseline?

Management of coronavirus support funds and materials The European Union donated through President Buhari on 14 April 2020 additional N21billion to the funds that have come in to aid Nigeria in man-

aging COVID-19. Organisations and individuals donated huge sums to this cause at the federal and state level. Last week, we reported that CaCovid said they now had N21 billion. The EU donation sounds like counterpart funding!

It has been raining Naira since the coronavirus support effort commenced. PTFCovid-19 owes citizens at least two things. Get to work with deploying the funds to build proper health infrastructure. Then give a full accounting of the money every month until the end of their six-month tenure.

Jump starting indigenous technology in healthcare I keep drawing attention to one of those positive bromides captured as an “objective” of the PTFCovid19. It said the Task Force would seek to “lay a foundation for scientific and medical research to address all emerging infectious diseases”. Well, it is game time now. PTFCovid19 should set up the sub-committee. They should be liaising with our pharmaceutical manufacturers and the many research institutes in our land. Many eminent citizens, specialists as well as dabblers, are stepping with suggestions on incorporating into our pharmacopoeia indigenous formulations. Let’s hear what is playing out.

No cash backing Many people do not associate the bureaucracy in Nigeria with creativity.

However, when you get close you will be amazed at how they turn situations in their environment into creative coinages. Remember 419? It came from that section in the criminal code. The Police

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Great expectations lie in the minds of citizens for the next 14 days, and their focus is the Federal Government represented by the Presidential Task Force on Covid19.

PTFCovid19 would need to do things and communicate them so it earns the trust and confidence of Nigerians

Coronavirus: 5 leadership lessons from COVID-19

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he coronavirus is an unexpected event no insurance company can pre-empt and insured. The world leaders were caught unaware. What President Trump termed “the China virus” turned out to be a global pandemic. When China was battling with the first set of the virus in Wuhan, some of the world leaders mocked the Chinese approach. The lockdown was called names, and everyone believes China government was too autocratic in its path by violating her people’s right with the restriction of movement.

We did not know that the virus was gathering momentum to move around the world without passports or visas and effect massive death and restrictions on all aspect of lives. The super-powers’ (US, UK, Spain, Italy to mention a few) capacities to cater for her people has been tested and found wanting by the unexpected virus. Money has failed. The rich and the poor are now on the same page. Thus, coronavirus is a leveller.

There are lessons to learn as the world battle with the coronavirus, and they are leaderships lessons. Leaders are learners from past and current events. The events and decisions of yesteryears are the bedrock of leaders’ experience and aid in providing informed business and political directions if adequately considered with the current realities. Here are five of the many leadership lessons from COVID-19.

Leaders are decision-makers. Being decisive is an essential attribute of an effective leader. When China first announced her battle with the coronavirus, some world leaders did not see the need to prepare ahead and left their borders porous. The economy was the concern of the US president. The impact of shutting down the economy on his re-election bid overtook his fears for the health of the citizens. Nigeria would have done better if we had closed our borders on time. It was never too late to do the right thing. However, if all the passengers in the March 13th BA and Virgin Atlantic flights have been quarantined, the spread of the virus by those who later tested positive would have been contained. Leaders must be decisive.

Being decisive is the stronghold of leadership.

Leaders who are not decisive are the one without the full understanding of their role or lack the knowledge of the situation or are afraid of failure from the required decisions.

The decision of the President Buhari to extend the lockdown in Lagos, Abuja, and Ogun state for additional 14days is decisive. The president in his speech was caught between saving the lives of over 200 million Nigerians or going for his concerns for the over 42million small businesses that need to operate daily. Going against the experts’ opinion for the lockdown to curtail the spread of the virus was not an option for Buhari. He was decisive in his decision to extend the lockdown and with the additional one million households to be added to the palliative food list.

When leaders are faced with an awkward situation, their ability to quickly weigh the available information and take an absolute position is the strength of their leadership character and effectiveness.

The world is abundant—the abundance of the fund and all other resources needed to deal with the global pandemic. Leaders must think and believe there are resources for them to be able to make impacts. The Nigerian private sector raised a whopping sum of N20billion outside donations of equipment for testing, isolation centres and volunteers. This shows that resources are available before the crisis and what was missing was the innovation that would have tapped into the supplies ahead of the pandemic. Imagine a leader who understood the implications of the low capacity and ratio of health facility per average Nigerians decides to act a few years earlier in partnership with the private sector.

Perhaps the donations coming as the emergency fund would have been raised and facilities that are hitherto lacking would have been available even if not to the number and magnitude required to curb the COVID-19.

Abundance thinking will help willing leaders to see no restriction if they desire to change the world and make it a better place. Thinking

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abundance of desire, resources and capacity allow leaders to take ownership for change, become intuitive and regularly reflect, enhance in-depth and comprehensive collaboration with other stakeholders. Most if not all the business leaders who made sumptuous donations are abundance thinkers in their businesses and private lives. Abundance thinking is a reliable cornerstone of leadership effectiveness.

The link between decisiveness and abundance thinking is responsiveness. Leaders must be leading from the frontline in the time of crisis. It was said that the fastest way to gain leadership is to solve problems. I remember my days as a business manager in the bank. I was faced with the need to raise N1billion within three weeks to manage my balance sheet and end the year on a good form. As I speak to my team and share the N1billion emergency deposit target among my team members, the leading voice in me whispered “you must be in the front and show the example”. Thanks to my abundance mindset. I followed my decisiveness with a responsiveness that creates the N1billion from the first customer I approached.

I gain more respect from my team as a leader who goes beyond devising a strategy to the one who walks his talk.

Governor Babajide Sanwo-Olu is an excellent example of leadership responsiveness in this time of Coronavirus in Nigeria. I knew he would succeed as a leader, given the events that brought him into power. First, there is always resistance to every positive upliftment.

When his predecessor was opposing him, I knew with the problem he will have no choice than to justify his selection after the election.

Second, is the state of the Lagos’ roads immediately he became the governor. Nearly all the roads were in bad shape with heaps of refuses everywhere. That may sound like a problem to someone without the right leadership mindset.

Problems are the platforms for leaders to show their effectiveness and gain the trust of the people they lead.

If you do not know Jide Sanwo-Olu, the pandemic has made him more visible because

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and the civil service gave it wings.

One of the most popular expressions from the service is the concept of “no cash backing”. It refers to a situation where a supplier’s papers have gone through the mill. All that is left is get your cheque. Sometimes it can even be that relevant authorities have signed the cheque. Then they tell you not to present. Why? “There is no cash backing”.

The Federal Government locked down citizens with “no cash backing” for more than 85 per cent of the people.

PMB’s order to increase by 1m recipients of the conditional cash transfer to 3.6m drew deserved scorn everywhere.

PTFCovid19 should bring the president up to date and cause a scaling up of the numbers. 3.6m in this land? It would not even suffice for Lagos State! Please let’s get serious.

Equity in disbursements When and where there is cash, the Federal Government should practise equity. It is not equitable that it shuts down Lagos and Ogun States as well as the FCT, depriving residents of opportunities to earn, then sends the most financial assistance to Zamfara and Katsina states. Citizens are watching the PTFCovid19 to see how it rescues the Buhari administration from such uneven handed measures.

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

Positive Growth with Babs Babs OlugbemI

he was responsive to the crisis at hand. He did not delegate his duties but worked as a team member with the health professionals.

So far, he has been leading from the frontline showing himself as a leader that is available in time of need and leading by example. He was at his house on the Easter Sunday, and proof to Lagosians that leading is by example not by an exemption. Responsiveness gives meaning to decisiveness, abundance thinking and communication.

According to the recent Chatham House report, an African leader was described as aloof and disengaged from his people and the leadership situation of his country. Leaders who fail to communicate regularly and effectively cannot provide efficient and visible leadership in crisis. Boris Johnson, the British Prime Minister, is leading and communicating with his people. Donald Trump is communicating though I have a lot of reservations with how he does that. Leaders must be accountable to the people. The platform for accountability is communication. Purposeful, positive, and effective communication is required to balance the equation of leadership. There is no time to communicate effectively and positively than in a time of crisis.

Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng Babs Olugbemi FCCA, the Chief Responsibility Officer at Mentoras Leadership Limited and Founder, Positive Growth Africa. He can be reached on babs@babsolugbemi.org or 08025489396.

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Thursday 16 April 2020

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An Easter like no other: Where are the people?... Nigerian police & the dynamics of ‘covidflation’

ik MUO

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hen I was in Enugu (1982-1987), there was story that “went viral” even though there was no social media (we had only mouth-media then). One man was madly in love, indeed, addicted, to “holy-waters”. His daily routine involved coming back from work, having a shower and then straight to US (Udi-Siding) where he would soak himself in the whitish liquid while seated in the usual bench in the thatched-roof bar. He and his gang would sing all sorts of suggestive songs exchange no holds barred banters, and told stories of their various acts of bravery; how they “finished” a battalion during the war, disbanded a group of armed robbers or killed a lion with bare hands.

His running-mate initially thought that he was having an affair with mama-Nkiru (there were no sidekicks then). She trailed him on three occasions and on each occasion, he ended up at US. She preached, persuaded and threatened to no avail and then she came up with an ingenuous plot.

She ordered a first-class palm wine from the Eze-Nkwu 1(king of tappers) from Ngwo, and chilled it in the fridge (those days when NEPA supplied light).

Around 4pm, the husband came in and was about to leave for the usual bar and bench fellowship when she told him they had to have a very important discussion. He agreed to hold the discussion later in the day but the wife insisted and he agreed to give her a few minutes, because he was late for his appointment. The wife then served him the dead-cold, first class palm wine. The man tested it and sure, it was the real thing. He took a second glass and then turning to the wife, he asked: “but where are the people”? In the absence of his drinking pals, the drink did not taste so well and so, he went off again to US! Where are the people? From the

look on his face, that was the question “running around the head” of His Grace, Adewale Martins, as he came in for mass on Good Friday, Holy Saturday and especially on Easter Sunday and came face to face with the EMPTY church. The Holy Cross Cathedral had just members of his “household”, 5 choristers and 4 other congregants, three of whom were Reverend Sisters.

Pope Francis would also be wondering, where are the people, when he delivered his homily to an empty St Peters Basilica that usually hosted hundreds of thousands during the Easter seasons.

A lot has been written about sheep without shepherd (Mark 6:34); but this Easter, it was the other way round; the Shepherd was there, appropriately attired with his staff of office but the sheep were missing in action, not because they rebelled but because they could not make it! And both at St Peters Basilica and Holy Cross Cathedral, there was no Alleluia Chorus because the choristers could not assemble. An Easter Vigil and Easter Mass without Alleluia Chorus? Unthinkable; but it did happen! We are used to Silent Night during the Christmas seasons but this time it was a silent Easter. It was bleak; It was uncommon; it was unusual; it was an Easter like no other.

Not even during the Biafran War of independence did we have this kind of experience.

The worst that would happen was that the churches were relocated to emergency buildings inside the thick forests and masses held between 5am and 6am. But I was confirmed during the War by Archbishop (now Cardinal) Francis Arinze. And in the Amichi Parish of 8 towns served by one Priest, we had our normal Masses at St Anthony’s Osumenyi, whenever it was our turn, which was once every 2 months.

The 2020 Easter process started normally with Ash Wednesday, which was normally celebrated. By the second Sunday of Lent, Coro had become so pervasive that it scattered everything: no school, no church, no market, lock up, lock down and lock in and since then, life has not been the same. On Easter Sunday, 13/4/20, Nigeria had 323 infections and 10 fatalities. There were 1.7 million cases across the globe with US moving from 12000 cases on 12/3/20 to 530,000 on 13/4/20 and 10,000 fatalities. Good Friday was the deadliest in the US with 2000 deaths.

There was gloom all over the world; ever country had been subdued by the

rampaging and vicious coro!

That morning, I ‘attended mass’ as I had been doing in the recent pass. We all dressed, arranged our chairs facing the new alter (our TV) and followed the mass from beginning to the end, stood up knelt and sat down as required, and received the Holy Communion spiritually. I have not been to my Parish in the past three weeks; I have not seen my priests and fellow parishioners since then and I could not follow up with our Facebook-mass because of streaming challenges. Thus because of the coro challenge, we have been forced to operationalise the teaching that the family is the domestic church; that we cannot go to where God is because God is where we are; after all, wherever two or three are, God is there (Mt.18:20).

Even before then, Itsueli had designed a programme of how to turn the Sunday into a Family Assembly! So, in the Past three weeks, my household has migrated to Holy Cross Cathedral where we now have a new Parish, Parish Priest and fellow parishioners and gradually, I have known them very well.

Our Archbishop, Fr Teko (Cathedral Administrator) Fr Ezeigwe (Bishops secretary) Fr Emedo (Associate Priest), the baritone Seyi Martins (of Metro FM, lector) Sr Fidelia Chukwuma with her sonorous voice and impeccable phonetics, Sr Dorothy Ezike (one of the elders of Our Lady of Apostle Congregation) and the dexterous organist. Yeah; I now have another catholic family, courtesy of DSTY 198 and Lumen Christ.

After the war (Yes; this is WAR!) I hope to enjoy a live fellowship with them For the first time in my life, I did not see, not to talk of entering a church throughout the Holy Week and on Easter Sunday. Not only that I did not go to church; I did not even step out of my parlour for the whole day. It was like the experience of one Chike Ezeokoli who was excited that he woke up with his family and the prayed together, cooked together, ate together and played together. This is the first Easter that I did not travel to Igbo-Ukwu to enjoy communal fellowship with ‘my people’ and attend to 1001 sociocultural activities.

This Easter, I was billed to attend, participate or officiate in 3 meetings, 5 Ozo-title ceremonies, 4 traditional marriage ceremonies among others. I did not travel home and did not attend any of them (99 percent of them were cancelled). It is the first Easter without our Umunna meeting and surprisingly,

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A lot has been written about sheep without shepherd (Mark 6:34); but this Easter, it was the other way round; the Shepherd was there, appropriately attired with his staff of office but the sheep were missing in action, not because they rebelled but because they could not make it

Note: The rest of this article continues in the online edition of Business Day @ https://businessday.ng Dr Muo is of the Department of Business Administration, OOU, Ago-Iwoye

Multiplying your value

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s humans, asides our intrinsic value, we also have extrinsic value – which depends on how well we unwrap our bundle of possibilities to make it visible to others. Intrinsic value focuses on our potential but extrinsic value focuses on our performance and productivity.

Just as ore is valued for its potential but gold is valued for its appearance which makes it useful and usable, in adulthood, value has to be perceived to be acknowledged. And it is only perceived when it is demonstrated.

As we transit into adulthood, we have to deliberately work on matching our performance with our potential – this is a crucial case for continuous personal development (CPD). CPD makes an individual personally effective and productive.

Without personal development, we become overly reliant on others to do for us what we ought to do for ourselves – we put ourselves at the mercy of men. On the flip side, personal development not only makes us independent,

but it also makes us relevant in the lives of others. And with relevance comes both influence and wealth.

While development is a personal affair, it manifests publicly as the ability to solve problems. “The quickest way to gain leadership,” says John Maxwell, “is to solve problems.”

And unlike in childhood when age determined leadership (natural leadership like this also reinforced entitlement mentality), those who develop themselves better lead others in adulthood.

We are in a world where people carry invisible crosses. Everyone you meet has a problem brought upon him by nature or a challenge attracted to him by the force of his aspirations.

In fact, because we will always have problems and challenges, men of skill will always be in demand.

People might not like your face. They might not like the colour of your skin. They might not like your religious preference and political perspectives. But if you have a skill that can

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solve their peculiar problems and challenges, they will still want to be associated with you.

And they would not mind paying you for the solutions that you bring along.

So, do you want to be influential? Start solving other people’s problems and challenges. Do you want to solve problems? Start developing skills. Your relevance is tied to your resourcefulness, and your resourcefulness is tied to your skilfulness.

A doctor cures a patient of his disease(s). A teacher transfers knowledge to a student. A cobbler makes and repairs shoes for people. They are solving problems with their skills.

The magnitude and intensity of the problems that your skills solve, as well as the scarcity of that skill, determine your extrinsic value. So, while there are many skills that you can learn, you should choose to master one that solves real problems of huge proportions. Acquire skills that are not common. If your skills are common, you will be easily replaceable.

Entitled people are known for the problems

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the world did not collapse. And the messages that poured in were most appropriate for the season; we had message of hope out of the mess as we met the risen Christ in coro-induced crisis (next week) Other matters: Nigerian police and the dynamics of Covidflation Economics like Bismarck Rewane, Ayo Teriba, Nwokoma and Tella have another term to contend with and that is covidflation! We already know what inflation is, whether it is YOY or QOQ; we know its various components and we know the very mean variant called stagflation. Inflation in Nigeria is already at 13 percent and is projected to get to 19 percent and this trend is due to, among other things, covidflation.

Covidflation is inflationary pressure linked to Covid-19. When we had our index case on 26/2/20, prices of certain goods rose astronomically. A micro bottle of sanitizer moved from the N300 range to N2000+; and facemasks moved from less than N500 a pack to N5000 and that was if you saw it to buy. These ones are due to the forces of demand and supply, panic buying, supply chain dislocations and avariciousness/profiteering. Profiting is good but Profiteering is evil. Profiteering is making obscene and sinful profits at the expense of your fellow human beings.

Food items were the next group that experienced price hikes and that is where our ever-active policemen came in. On 6/4/20, we went to the neighbourhood market to buy some fruits and condiments and the prices of the items had become irregular. The fruit seller said a police man carried her in a police vehicle to the market and charged N500 for a distance she usually paid N50k. It was with a police van. A vegetable seller said that everybody in their own vehicle was taxed N1200. The fish seller said they policemen charged their driver 15,000 and they all had to share the police imposed COVID tax! By the time I went to the same neighbourhood market on 13/4/20, the tithes to the police had gone so high that even my regular fruit customer could not give me “jara”! She said it was no longer doable after she had shared her money with police men.

Bright Ukwenga they have; responsible people are known for the problems they solve. Haven’t you noticed that there are some people whose calls you pick reluctantly or even prefer to neglect altogether?

Why? Because they are most likely making demands on you without adding value to you.

You don’t want to be that kind of person to your acquaintances, friends and mentors.

So, unwrap your bundle of possibilities by learning skills. The skill you learn today will make you an asset tomorrow. Go back to school, if need be. Attend paid classes. Volunteer somewhere. Sign up for internship or apprenticeship.

By all means, increase your value by gaining more skills.

Ukwenga is an esteemed Author, Conference Speaker, Leadership Development Consultant, and the CEO, ScribeTribe an innovative media and publishing enterprise helping individual and corporate brands to express their ideas creatively and effectively

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Thursday 16 April 2020

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Why has Nigeria never had an inspirational president? ‘ Because the Remi Adekoya

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n a crisis, all eyes turn to the leader. People want to hear something reassuring, something that gives them a sense of direction, something that makes them feel in capable hands. Because a crisis is a scary experience. Especially if we have no idea how or when it will end. Nigerians may be used to crisis, but they are not used to this kind of crisis. Pandemic, lockdown, insecurity and economic hellfire all in one. Hence, anytime it is announced President Buhari will make a speech, people tune in, hoping to be reassured, desperate not just for information, but also for inspiration. profane Buhari’s speech this week announcing the continuation of the lockdown was, like all his speeches, painfully uninspirational. Dull. Wooden. Unmemorable. Read from a script with the body language of a man announcing changes to the train schedule. That he did not even acknowledge the spate of armed robberies and insecurity in the lockdown states of Lagos and Ogun was in of itself unforgivable, but the entire performance was just not it. And make no mistake, at presidential level, politics is a performance. Words matter. As does how you deliver them.

Britons remember Winston Churchill not for his policies, but for his stirring speeches during World War II. Despite being America’s president for 12 years, Franklin Delano Roosevelt is best remembered for a single line from his 1933

speech during the Great Depression: “The only thing we have to fear is fear itself.” This is not about bashing Buhari.

After listening to him speak this week, I started thinking of how other Nigerian presidents had performed in this sphere.

Even ardent fans of Goodluck Jonathan are unlikely to claim he was an inspiring speaker. Neither, I suspect, would Musa Yar’adua’s supporters. Obasanjo can be very witty and memorable in conversation, but his presidential speeches were no less dull and uninspiring. Abacha?

Forget it. Babangida is widely agreed to have been likeable in person, but no one says they were ever inspired by him or anything he said. In fact, I doubt any Nigerian can recall a moment they felt inspired by any Nigerian head of state. This in a society full of fascinating characters. Why has a country where interesting personalities abound never produced an inspirational president?

Because the leadership selection process in Nigeria makes sure to weed out the kind of person who could become an inspirational president. To become Nigeria’s president requires the support of a hodgepodge of power cliques who control the political sphere in various areas of the country. The major power groups are centred in the north because this is where most of the votes are, but there are also various influential cliques in the south.

If you think you are going anywhere without the support of the dominant cliques of the moment, you are being naïve. Go and ask the presidential candidates who have tried it. These cliques are generally dominated by political godfathers in association with the most influential traditional rulers, religious leaders and moneybags. They are mostly men, and they are mostly men with significant egos. Most, especially the political godfathers and moneybags, got to the top not because they were the most talented, but due to their readiness

to do anything for money and power, including kill and use violence when necessary. They are generally unburdened by the pesky constraints of morality. But while they usually have large egos, they are simultaneously insecure because they know deep down, they are not the cream of the crop. People like that tend to be very petty. If a “Nigerian Obama” came along, someone who was clearly inspirational and likeable, they would hate him instantly and do everything to marginalize him.

They would feel threatened by him (or her) because if you have the potential to command a national following - not just an ethno-regional one - then you cannot be controlled by gatekeepers. That’s why MKO Abiola had to be brought down. His sweeping June 12 victory shocked Babangida and the northern power groups around him. A Yoruba man popular with the northern masses? And financially independent at that. This guy would be uncontrollable.

The nightmare of the numerous power cliques that run Nigeria is an uncontrollable president. By definition, this disqualifies anyone exceptional.

This is the part where I’m supposed to offer a solution. Where I say if we do X and Y, this problem can be solved.

I could do that. I could use phrases like “electoral reform” and “systemic change”. I could talk about “transformational leadership” and how Nigeria needs a new kind of politics. But you’ve heard all that before. Those are nicesounding buzzwords that have nothing to do with the reality of on-the-ground Nigerian politics.

The first step towards solving any problem is facing it honestly and squarely, at its core, not its margins. The core truth is that Nigerian politics has always been a wretched compromise at the national level. Because Nigeria itself has been one long wretched compromise.

“Compromise” being a kind word con-

leadership selection process in Nigeria makes sure to weed out the kind of person who could become an inspirational president.

To become Nigeria’s president requires the support of a hodgepodge of power cliques who control the political sphere in various areas of the country

sidering how the country came about in the first place. The wretchedness of the Nigerian compromise is best exemplified in the idea of the “rotating” presidency. The north rules for 8 years after which it’s the south’s “turn.”

So, if by some chance, a brilliant transformational leader with a realistic plan for developing Nigeria emerges in the north in the next few years, he or she has no chance of becoming Nigeria’s president until 2031 at the earliest. How does that make sense if you really sit down and think about it? I think in fifty years, people will look back and wonder at some of the absurd arrangements being accepted today in the name of this wretched compromise.

That Nigeria is not working is not a coincidence. It is high time we acknowledged that the 923,000-odd square kilometres which constitute the space called “Nigeria” needs to be radically reimagined and reorganized.

This is a normal historical process. Most countries that exist today did not exist a hundred years go or existed in a different form. Great Britain, the creator of Nigeria, is constantly being remodelled.

Wales, Scotland and Northern Ireland are run very differently today from the way they were 50 years ago when all power resided in Westminster.

In his speech commemorating the 50th anniversary of the end of the Nigerian civil war this January, Wole Soyinka urged Nigerians to ask themselves a simple question about how Nigeria has been constituted: “Have we been had?”

I think this is a good question to start reflecting on seriously. Otherwise, the Nigerian experience will continue offering nothing more than simply more of the same.

Dr Adekoya is a journalist and political scientist. He has written for the UK Guardian, Foreign Policy, Foreign Affairs, Washington Post and Politico among others. He tweets @ RemiAdekoya1

Whilst OPEC may sink, Nigeria desperately must develop wings and fly

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rankly, if you perhaps are shrewd enough to assume Riddhi Ambavale’s quote was specifically put together to describe The Organization for Petroleum Exporting Countries (OPEC) in 2020, you wouldn’t be “too” wrong. “This is not the end of life, but the beginning of a slow death”.

The power and significance of the organisation seemingly appears to be in rapid steady decline.

OPEC defines itself as an international organisation with the aim to influence and maintain price of oil through the control of production levels and to generate revenue, which goes towards meeting the needs of its members. Created at the Baghdad Conference on September 10-14 1960 by primary members; Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. It is now made up of 13 members in total. Libya, UAE, Algeria, Nigeria, Angola, Gabon, Guinea with Congo joining as recently as 2018.

Putting the benefits of OPEC succinctly, stable oil prices, efficient supply, investment in and development of its member countries are its promises which were hitherto met without much ado. Member countries have made varying degrees of economic and social progress over the past 60 years of its existence, with OPEC exhibiting tremendous control and price stability until 2014, save for 1998 when oil price averaged $11.91/barrel.

Emergence of other players In 2014, new players emerged as big players like the USA, Russia, China, Mexico and a few others, slowing gaining footing since dawn of the decade. The oil reserves and productions of these countries were shored up by the

advent of hydraulic fracturing commonly referred to as Fracking; A mechanism to extract recoverable shell oil wherever found albeit with possible stern repercussions. Fracking carries huge environmental risks such as earthquakes, sanctioning its total or partial ban by governments in countries like the UK, France and Mexico. This has posed no form of deterrent whatsoever to countries like the USA and China among others. It is also worthy of mention that China and the USA have judiciously and calculatedly amassed oil by purchasing from OPEC and other suppliers for donkey years. Their oil reserves are mammoth.

Power tussle The OPEC has incessantly battled for influence and control ever since, strategically against the USA and quite recently, directly with Russia. With its dwindling influence due to the numerous players in the fray, small and big alike; the fatigued hands of the OPEC haplessly endeavour to prolong the fight by crafting an agreement called “Declaration of cooperation” (DOC). The “fallible” aim of this agreement was to extract commitments from non-players in the market; to harmonise and mirror the activities of OPEC to either increase or decrease production quantity, to manage and stabilise price. This particular move completely decries the powers of the OPEC rendering it all but impotent in this age and dispensation. For an organisation set up to wield influence in the market, to descend out of necessity and co-opt non-members in order to stay influential; it is all but finished.

The fallibility of the DOC agreement was exposed when Saudi Arabia, a leader in OPEC’s production quota decision, entered into a price

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war with Russia (a supposed co-opt OPEC plus member). Both countries forced their hands causing a crash in price per barrel to as low as $15. We all know what happens when two elephants fight. Developing member countries like Nigeria, Angola hugely dependent on proceeds from oil are scared to the teeth for their economic present and future.

The USA appears unperturbed and less likely to compromise their position of increased production. Note that the USA are now the major producers of oil daily averaging 12 million barrels in 2019. Before Fracking, the United States were the major customer of The Organisation of Petroleum Exporting Countries. With USA now into active production, OPEC experiences decreased patronage and predictably would very soon not have them on its list of customers.

To further substantiate predictions of the demise of OPEC, there has being no noteworthy addition of petroleum producing countries in OPEC. China, Mexico and the others see absolutely no justification to enlist and rather deal independently, surrendering to forces in the market. Instead, OPEC has recorded exodus of some member countries worsening its forlorn position. They increasingly look more susceptible to more members exiting than any notable inclusion. Indonesia, Qatar, Ecuador are the countries to have exited OPEC for multifarious reasons but remotely sponsored by the need to produce beyond or below OPEC’s mandates.

These departures affect OPEC in 3 ways; highlights their dwindling influence, weakens their control, reduces their output barrels however slightly.

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Ekene Onyeama Nigeria – any solutions in sight The current economic crises present an opportunity for transformational change. Nigeria must put aside political considerations, unite and implement quality policies that will insure the lives of not just posterity, but our very own economic future. Government has to look inward into managing its existing income sources and developing new revenue sources.

Firstly, analysing our non-oil sources, we have made remarkable revenue from overseas remittances over the last decade. Taxation and levies, fees, import duties aviation, tariffs all make up other non-oil sources that have earned us interestingly notable revenue.

The government must overcome the scourge of embezzlement and profligate spending; if not for any moral reasons but simply because the country can no longer afford it. Government should ensure that these revenues generated are ploughed back into the development of the country’s economy.

Through building befitting infrastructures and giving more attention to sectors capable of directly influencing and improving business existence in the country. This will aid the springing up of new businesses and also attract investors.

Note: The rest of this article continues in the online edition of BusinessDay @https://businessday.ng Ekene Onyeama is a young chartered accountant and private banker.

@Businessdayng

12

BUSINESS DAY

Thursday 16 April 2020

Editorial Frank Aigbogun

Nigeria’s hard choice of health over economics

editor Patrick Atuanya

Nigeria chooses prevention rather than cure in managing the pandemic

Publisher/Editor-in-chief

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

Bashir Ibrahim Hassan

GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu

F

orced between the devil and the deep blue sea, President Muhammadu Buhari chose the path of further lockdowns as a containment measure against COVID-19 in Nigeria on Monday, 13 April when he ordered an extension of the lockdown on three territories.

With 71 percent of the infections, there is no doubt that Lagos and Abuja, FCT deserve the lockdown. The spread of infection has also grown to 19 states from 12 on March 29.

Nigeria chose the route of prevention of widespread of the coronavirus. The option would have been to open the economy ever so slightly to allow citizens to breathe and earn a living in a daily pay economy. The federal government made the hard choice of health over economics.

Further lockdown is borne out of evolving global best practice in the management of the pandemic.

Nigeria followed examples across Africa and the rest of the world.

The paradigm is that containment is the most effective measure to stop the spread of the coronavi-

rus; it is more so for countries such as ours where the capacity of the healthcare system is doubtful.

Two weeks after the first 14-day lockdown, the incidence number has risen to 323 cases. Experts say the number does not tell even a quarter of the story as testing remains very low even against the standards of other African countries. Nigeria has tested slightly over 5, 000 persons, while Ghana has done more than 15, 000 with a smaller population.

On the face of it, Nigeria is looking good. There are 323 cases in 19 states. Nigeria has lost ten persons to the virus. NCDC says there are 228 active cases while our hospitals have discharged 85 cases. Nigeria has survived the first two weeks of WHO-recommended shutdowns with the numbers still looking good.

It is significant to note, however, that beyond these figures our incident numbers have followed the trajectory elsewhere. They have been increasing rapidly.

Hold it there, though. If Nigeria has done well thus far from the available figures, why do we need an extension of the lockdown given the huge cost?

President Muhammadu Buhari (PMB) admitted that the lockdown “will severely disrupt your livelihoods and bring undue hardship to you, your loved ones and your communities”. Knowing this, it is a surprise that the presidential address failed to acknowledge the evolving breakdown in the territories that he locked down. It was a significant lapse in the address.

The gains from the first 14 days?

PMB said they include implementation of “comprehensive health measures that intensified our case identification, testing, isolation and contact tracing capabilities.”

Nigeria “has identified 92 percent of all contacts while doubling the number of testing laboratories and raising testing capacity to 1, 500 tests a day”. The country has also trained “over 7,000” healthcare workers on infection prevention and control. NCDC has deployed to 19 states. Furthermore, Lagos and Abuja can “admit some 1,000 patients each across several treatment centres”.

PMB spoke of the palliative measures of the federal government involving “food distribution, cash transfers and loans repayment waiv-

ers” to ease the pains and assured that government would sustain them. That is good news.

The bad news is that the measures have failed to count where it should do so the most. Very few citizens in the three territories of the lockdown have seen or benefitted from these measures. It is evident in the growing hunger-fuelled anger, robbery, protests and citizen defence activism in parts of Lagos and Ogun States.

BusinessDay called for this extension as a social responsibility informed by our monitoring and reportage of the COVID-19 pandemic. After listening to PMB, we now make these calls The federal government must do more to reassure citizens in Lagos and Ogun States of their security and the ability of the government to protect them.

Rapidly increase the number of beneficiaries of the government’s welfare scheme. An increase by 1million from 2.6m to 3.6m does not even begin to scratch the surface.

Involve the private sector and coordinate efforts to extend assistance to the poorest of the poor.

HEAD, HUMAN RESOURCES Adeola Obisesan

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

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Thursday 16 April 2020

13

BUSINESS DAY

Investor

In association with

Helping you to build wealth & make wise decisions Market capitalisation

NSE All Share Index

NSE Premium Index

The NSE-Main Board

NSE ASeM Index

NSE 30 Index

NSE Banking Index

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

892.24 908.65

234.47

117.77

314.16

216.42

1,504.36

1,028.33

816.22

263.53

117.98

334.59

206.11

1,464.45

960.57

837.21

12.39

0.18

-4.76

-2.65

-6.59

2.57

-21.49

-20.18

-10.69

-20.57

Week open (03-4–20)

21,094.62

N10.994 trillion

1,749.72

871.08

734.99

Week close (09-4–20)

21,384.03

N11.144 trillion

1,786.28

877.07

734.99

Percentage change (WoW) Percentage change (YTD)

1.37 -20.33

2.09 -15.59

0.69 -23.85

0.00 0.00

1.84 -22.85

-26.15

-6.23

6.50 -43.56

NSE Lotus II

NSE Ind. Goods Index

NSE Pension Index

Dangote Cement N100bn bond: CSCS optimistic on depository service to investors Iheanyi Nwachukwu

W

ith its debut N100billion bond, Dangote Cement Plc is set to join other serial issuers in the Nigerian debt capital market that have mobilised long term debt financing.

Dangote Cement Series 1 Bond, which is up to N100 billion, is a landmark transaction for the Nigerian debt capital market, as it will be the largest-ever single corporate debt issue in the Nigerian capital market.

Haruna Jalo-Waziri, CEO of Central Securities Clearing System Plc (CSCS), Depository to the Bond noted; “With this debut N100 billion debt note, Dangote Cement Plc is once again reinforcing the capacity of the Nigerian debt capital market and setting a new benchmark in terms of size and pricing of corporate bonds.”

“CSCS, being the depository to about half a trillion-naira outstanding corporate bonds from twenty-three issuers, we are excited to onboard Dangote Cement bonds into our depository post the SEC-approval of allotments.

My colleagues and I are excited at working with all stakeholders: the Issuer, Joint Lead Arrangers, Exchanges and more importantly esteemed investors; PFAs, Banks, A s s e t Ma n a g e r s, T r u s t e e s, Custodians, Brokerage firms and HNIs, who would be participating in this landmark transaction,” he said.

“We earnestly look forward t o t h e a p p rov e d a l l o t m e nt schedule to promptly credit investors accounts and provide a consolidated view of all their investments across the capital market.” Jalo-Waziri added.

Similar to the Dangote Cement N150 billion Commercial Paper, which has helped deepen that segment of the money market and broaden local investors’ investment options in the fixed income market, the Series 1 bond, which is the debut issue out of the N300 billion Shelf Programme will further reinforce the potential depth of the Nigerian debt capital market and the ability of local corporates to fund long term projects from the domestic

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debt market.

Analysts expect the transaction to close at a tight spread to comparable Nigerian Sovereign debt note (that is the 5-Year FGN Bond), given the strong investment grade rating of the Dangote Cement Series 1 Bonds, AA+ from Global Credit Rating (GCR) and Aa2.ng from Moody’s.

Interestingly, analysts are positing the debt offering to be positive for the company’s equity valuation, as the fund is expected to fund expansion projects and refinance existing commercial bank debt, with expected cost-savings and a better realignment of the company’s capital structure.

The shares of Dangote Cement closed N117, and implied

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13.7percent dividend yield based on the final dividend of N16 per share (qualification date is May 25, 2020 while payment would be made on June 16, 2020.

With over 70percent market share of the Nigerian cement market and increasing earnings contribution from the African operations, Dangote Cement is positioned for growth, particularly as increasing adoption of the concrete option for road construction is expected to drive overall market demand, going forward.

Having lose 17.6percent yearto-date, as the bearish pressure of COVID-19 ravaged global equity market, the shares of Dangote Cement trades at historic low of 9.9x P/E and 13.7percent dividend yield, reinforcing the rare opportunity presented by current valuation in the Nigerian equity market.

Beyond the impact of the Dangote Cement debt transaction on the primary market, the size and the strong investment grade rating of the Dangote Cement Bond should enhance its secondary market liquidity, particularly as it is expected to be listed on both the Nigerian Stock Exchange and FMDQ Exchange.

With CSCS having full coverage of the market, it is well positioned to clear and settle all secondary market transactions on the Debt Notes, going forward, notwithstanding the Exchange, where it is traded.

With over N530 billion outstanding corporate debt issue and slightly less than N400 billion outstanding sub-national bonds, the Nigerian

@Businessdayng

debt capital market is increasingly becoming a viable source of longterm funding for both Corporates and State Governments.

On completion of the Dangote Cement Bonds, the outstanding non-sovereign bonds is set to hit the N1trillion psychological mark. More so, institutions like InfraCredit are broadening accessibility for medium sized companies that would otherwise have had challenges accessing the debt capital market due to their size, credit ratings or history, as this NSIA-backed entity provides irrevocable guarantee on the bonds of utility-based entities like Viathan Funding SPV and GEL Utility Funding, which raised N10billion and N13 billion in December 2017 and August 2019 respectively.

The book-building process for the Dangote Cement Series 1 5-year Fixed Rate Senior Unsecured Bonds, which commenced on Friday, April 3, 2020 is set to close today, Tuesday April 14, 2020 with the settlement date being Friday, April 17, 2020.

The Offer is open to both retail and institutional investors through any of the Joint Lead Arrangers, with minimum investment of N10,000,000 (10,000 units at N1,000/ unit) and multiples of N1,000. The Bond will be redeemed at maturity of 5 years but pays semi-annual coupon. Whilst the marginal cutoff rate would be determined by demand-supply through the bookbuilding process, the Joint Lead Arrangers have guided towards a bid range of 12.25percent and 12.50percent.

14

Thursday16 April 2020

BUSINESS DAY

Investor Helping you to build wealth & make wise decisions

Investor’s Square

United Capital Investment Views

Equity market: Stocks rebound amid OPEC+ agreement

A

f t e r f o u r consecutive weeks of losses, the performance of the equities market in the previous week, took a positive turn, as the NSE-ASI moved up by 1.4percent to 21,384.0 points. Consequently, the year to date (YTD) loss moderated to -20.3percent.

In terms of market capitalisation, investors gained N150.8billion in value, as market capitalization closed at N11.1trillion. Also, activity levels were off the chart, as average volumes and value surged by 98.8percent and 121.1percent as investors took long positions in heavy weighted stocks.

Across the sectors under our coverage, three out of five sectors gained. The Banking (+12.4percent) sector was the star performer, as WEMA (+25.5percent), UBA (+25.3percent), STERLING (+25.2percent), FIDELITY (+24.3percent), FBNH (+19percent), ZENITH (+17.7percent) and others increased massively.

The Consumer goods

(+6.5percent) sector followed suit, owing to DANGSUGAR (+20.2percent) and NESTLE (+8.5percent). Also, the Insurance (+0.2percent) sector gained, as AIICO (+15.1percent) and LASACO (+9.5percent) moved up. On the losers’ side, the Industrial goods (-6.6percent) sector fell, as the losses in BUACEMENT (-12.8percent), CU TIX (-10percent) and DANGCEM (-6.4percent) outweighed the massive gain in WAPCO (+41.3percent). Finally, the Oil and Gas (-4.8percent) declined, on the back of selloffs in ARDOVA (-18.5percent) and SEPLAT (-9.1percent).

Notably, investors’

sentiment was positive, as market breadth was strong at 2.0x, with 32 stocks winning and 16 stocks losing. Elsewhere, FBN Holdings Plc released its FY-2019 audited results, showing a 6.4percent growth in Gross earnings to N622.1billion and a 26.6percent growth in Profit after tax to N73.8billion.

The company declared a dividend of N0.38/share. Also, Lafarge Africa (WAPCO) Plc recorded a 2.2percent decline in Revenue to N213billion and a 91.6percent growth in Profit from continued operations at N15.5billion, declaring a dividend of N1/share.

This week, we expect trading activities to remain on a positive note, as investors continue to lock in, at the current relatively low prices.

Also, the positive developments in the oil market is expected to reduce the risk off sentiment of FPIs and local investors towards Nigerian equities.

Money Market: Rates at the OMO market decline by 149bps In the prior week, financial system liquidity remained buoyant (in excess of N300billion), as Naira inflows

outweighed outflows. For the week, the major inflow came in form of OMO maturities (N106.7billion), which was partially mopped up by OMO sales (N39.4billion).

Also, an FX retail refund was mopped up by a corresponding FX retail auction, towards the end of the week. Coupled with a CBN CRR debit, average interbank funding rates -open buy back (OBB) and over night (OVN) rates spiked to 15.9percent, vs 2.4percent at the close of the preceding week.

At the primary market, the CBN was able to allocate 78.7percent of the total amount of OMO bills on offer. Notably, there was no demand for the

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89-day bill and 173-day, while the 341-day bill was mildly undersubscribed (bid to cover: 0.98x). As such, there was no sale on the 89 and180-day bill, while the apex bank allotted N39.4billion of the N40billion on offer for the 341-day bill.

Also, similar to the previous OMO auction, stop rate closed at 12.8percent.

At the secondary market segment, we observed renewed buying interests, as players with idle liquidity took positions in the OMO market. Thus, average OMO yield decline by 149bps week on week (w/w) to settle at 12.3percent. On the contrary, average yield at the NTB market ticked up by 8bpsw/w, to close at 3.3percent.

Looking ahead, we expect the financial system to stay liquid, as maturities in form of OMO (N195billion), NTB (N58.5billion) and Bond coupon (N32.7billion) are scheduled to hit the system.

Bond Market: Eurobond market sees renewed interest In the previous week, the local secondary bond market continued to attract buying interests, fueled by the buoyant level of system liquidity and investors hunting for doubledigit yields. As a result, average yield dropped by 46bps, to end the week at 11.31percent.

Notably, there were significant interests across all bond maturities, as yields on all instruments declined.

At the Eurobond market, in line with our outlook for the preceding week, oil prices above $30.0/b fueled demand for Nigeria’s sovereign Eurobonds. As a result, average yield on sovereign Eurobonds moved lower by a whopping 161bps w/w, to 11.42percent.

On the other hand, the average yield on corporate Eurobonds ticked up by 267bps w/w, to 14.1percent. This was majorly as a result of increases on in the yield on banking names, ZENITH 2022 and UBA 2022.

This week, we expect the outcome of the G20 meeting to sway the direction of the oil market, and in turn influence investors’ sentiment towards Nigeria’s sovereign instruments. Also, yields on domestic bonds are expected to track lower, as local players continue to find outlets to invest idle funds.

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

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

E-mail: iheanyi.nwachukwu@businessdayonline.com

Fixed Income and Currency Market Review:

SEC clarifies ban on sharing of gifts at AGM Iheanyi Nwachukwu

T

he Securities and Exchange Commission (SEC) has clarified its position on the sharing of gifts at Annual General Meetings (AGM) as contained in Rule 602 (4) of its Rules and Regulations.

According to the SEC, “Rule 602(4) states that ‘’public companies shall not distribute gifts to shareholders, observers and any other person at Annual General Meetings/ExtraOrdinary General Meetings’’ “The Commission considers it necessary to clarify that ‘light refreshment’’ are not construed as ‘’gifts’’.

The SEC had last year amended its Rules and Regulations to stop listed

Mary Uduk, acting director general, SEC

companies from distributing gift items at AGMs. Justifying the Rule, the Commission said public companies spend a significant amount of money on corporate gift items at AGMs/EGMs which has a great impact on their profitability.

“Few of the companies

are making reasonable profits and even fewer can afford to pay dividends. If the amount budgeted for the gifts at AGMs/ EGMs can be reserved for other relevant operational or administrative expenses, it would positively impact on their earnings per share” It explained.

Specifically, the rule provides that. “pubic companies shall not distribute gifts to shareholders, observers and any other persons at AGMs/ EGMs. Public companies shall not convene any meeting with select group (s) of shareholders prior to an AGM/EGM. SEC stated that any company that violates the provisions of the rule shall be liable to a penalty of not less than N10 million.

Flour Mills, Primero boost bond listing on Nigerian Bourse Iheanyi Nwachukwu

T

he successful listings of Flour Mills of Nigeria Plc and Primero BRT Securitization SPV Plc bonds on the Nigerian Bourse signposts the Exchange’s recent commitment to maintain operations in the face of Coronavirus pandemic.

Since the activation of its Business Continuity Plan in response to COVID-19, the Exchange has transitioned to digital operations with its employees working remotely and Dealing Member Firms trading remotely.

The Exchange has had no disruptions to its operations since the activation of the slow

down efforts by state and federal governments to flatten the COVID19 curve.

Flour Mills of Nigeria Plc listed its N12.499billion 3-Years 10 percent Series 3 (Tranche A) Fixed Rate Senior Unsecured Bond due 2023; and the N7.500billion 5-Year 11.10percent Series 3 (Tranche B) Fixed Rate Senior Unsecured Bond due 2025.

Also, Primero BRT listed its N16.5billion Series 1; 17percent Fixed Rate Bonds due 2026 under the N100billion Medium Term Bond Program.

The Group Managing Director, Flour Mills Nigeria Plc, Peter Gbededo expressed excitement over the listing of the bond on the NSE. He said, “We are delighted to return to the capital market with such

a successful outing, especially with the level of interest shown by investors.

The response from the market vindicates our decision to have taken this additional step to diversify our financing options beyond short-term commercial bank debt.

Furthermore, we are excited about the role NSE is playing in deepening secondary market liquidity thus aligning our market with international best practices, and we look forward to enjoying the benefits of these efforts in our short and longterm instruments.”

The Chief Executive Officer, NSE, Oscar N. Onyema, lauded the management of Flour Mills Nigeria Plc and Primero BRT Securitization SPV Plc and the professional parties to the issue.

NSE promotes gold as viable option in current investment landscape

N

ow more than ever, investors are looking for newer investment options that can provide the much-needed diversity to their portfolios.

In presenting some of the instruments available to the investing public, the Nigerian Stock Exchange (NSE) partnered with ABSA Securities Nigeria to host a webinar on Thursday April 9, 2020.

With the theme, “Using Alternative Investments Classes to Navigate Uncertain Times”, the webinar delved into the value of Gold as a viable investment option and the ease

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of access the NewGold Equity Traded Fund (ETF) provides for investors who are ready to take advantage of the opportunity.

Speaking during the webinar, the Head, Trading Business Division, NSE, Jude Chiemeka said, “As a multi-asset class Exchange hub, we recognize opportunities in the alternative investment asset space for the Nigerian Capital Market and are working assiduously with stakeholders to provide more insight into these instruments.

Historically, Gold – which is categorized under the commodities segment of alternative investment classes @Businessdayng

– has been recognized as a safe haven asset used to provide stability to portfolios in times of market uncertainty.” He further expressed his delight over the partnership with ABSA and the opportunity to demystify investing in Gold from a fundamental and trading perspective.

Shedding more light on the opportunities Gold has to offer, Head, Exchange Traded Products (ETP) Business, ABSA Regional Operations, Michael Mgawaba, explained that Gold is not only defensive, but it can also be used for risk management and delivers impressive results.

Thursday 16 April 2020

BUSINESS DAY

15

cityfile Police arrest violators, impound vehicles in Sokoto

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Governor Babajide Sanwo-Olu, taking the issues confronting Lagos to God in prayer, during the Easter celebration.

Residents raise concerns over lockdown extension, insecurity

S

ome residents of Lagos have expressed dissatisfaction with the decision of the Federal Government to extend the lockdown of the state, saying it would further aggravate hunger and the level of insecurity in the state.

The residents said that although the extension was well-intended, but it was impacting the citizens negatively.

The residents said that activities of hoodlums had increased in their neighbourhoods, making them to sleep with only one eye closed.

They added that they had slipped into hunger because of closure of their businesses.

A welder, Tony Philip, said that the aim of the lockdown was laudable but insecurity and hunger was making it unattractive.

He urged that security agents should do more to safeguard lives and property.

“The government should ensure that the palliatives they are sharing reach us because I have not seen anyone who received the money being shared by the government.

“The president said he would extend the pallia-

tives to additional one million homes. Who are they? why am I not included?” he asked.

The welder blamed recent robberies in neighbourhoods on hunger resulting from the lockdown.

“The insecurity we are experiencing in our neighbourhood this period is as a result of hunger.

“Government should put more measures in place to cushion the effects of the lockdown,” Philip said.

A builder, Sunday Akayaya, also said that he was not financially prepared for the initial lockdown and, therefore, suffered

hunger.

“Now, it has been extended by two weeks. How will my family survive? I earn a living on daily basis; now everything is standstill – no work, no money. “Government should come to our aid,” he urged.

Another resident, Brown Asuqwo, said that crime had increased due to the lockdown.

“We cannot sleep with our eyes closed; residents now keep watch at night because ever ybody is scared of being robbed,” Asuqwo said. He urged security operatives to increase night patrols to scare robbers.

Group urges door-to-door delivery of relief materials to poor citizens JOSHUA BASSEY

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nongovernmental organisation, Centre for Change, has called on the Federal and State governments to undertake door-to-door delivery of relief materials as a better way of reaching vulnerable Nigerians during the lockdown.

President of the group, Okei-Odumakin made the call in a statement issued in Lagos.

President Muhammadu Buhari, on Monday

extended the lockdown in Abuja, Lagos and Ogun States by 14 days to contain the spread of Coronavirus in the country.

Buhari had, on March 29, ordered the lockdown for an initial period of 14 days, while several states had also introduced similar restrictions.

Okei-Odumakin explained that the relief materials could be delivered effectively through the services of logistics companies for equitable distribution.

She observed that the palliatives being offered by the government have so www.businessday.ng

far not worked effectively.

Okei-Odumakin said the lockdown extension

by President Buhari on Monday might be inevitable because of where the country was with COVID-19 pandemic.

“The mood of the president in his latest broadcast was different from what it was 14 days ago. “Besides, we also expect the government agencies working on the Covid-19 pandemic to positively change their style in like manner.

“The government should also look at palliative measures that can

reach a wider layer of the society like a waiver on electricity bill. Government needs to get back to the drawing board while the people should be ready for more sacrifices but with support from government,’’ Okei-Odumakin added that the level of insecurity had become intolerable and the security forces must face this presently.

She noted that government at all levels must avert a total breakdown of law and order, saying that they should also be alive to their responsibilities to citizens.

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he police in Sokoto have arrested 28 persons and impounded 28 vehicles for violating the inter-state movement restriction order imposed by the state government to check the spread of Covid-19.

Ibrahim Kaoje, the Commissioner of Police in Sokoto, disclosed this while speaking with newsmen.

Kaoje said that the defaulters were arrested between April 11 and April 14 by a Joint Task Force Patrol Team while patrolling the Sokoto-Zamfara and Sokoto-Kebbi borders.

Among the vehicles impounded were eight Sharon, one Volkswagen, one Honda Accord, one Ford and one Toyota Avensis.

He noted that the suspects embarked on their journey knowing that there was a restriction order, adding that after investigation they would be prosecuted.

The police chief restated the commitment of the command toward clamping down on those who use unregistered vehicles, cover number plates and use diplomatic number plates.

He said he would lead a “special task force’’ toward enforcing the order.

“The mandate of the special task force will include the arrest of unauthorised policemen attached to VIPs and individuals in the state.’’

The police chief cautioned those engaging in the acts to desist or be “appropriately sanctioned.’’

Undergraduate arrested for violating teenager

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peratives of t h e Ni g e r i a Security and Civil Defence Corps (NSCDC), Ondo State command, have arrested one Femi Adejuwon, an undergraduate of the Federal Polytechnic, Ado-Ekiti for allegedly raping a 16-year student.

State commandant of the corps, Philip Ayuba, disclosed this in a statement signed by Ayodeji Olufemi, the command’s public relations officer.

“Information reaching us from concerned citizens in Ijoka area, Akure, on Sunday, April 12, 2020, says that a 16-year student, who is currently awaiting admission, was allegedly raped by one Femi Adejuwon, an undergraduate of Accountancy Department, Federal Polytechnic AdoEkiti.

“Based on investigation, the victim narrated her terrible ordeal after being discharged from the Police Clinic, Akure.

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“She said that the suspect called her on phone to meet him in his friend’s place. On getting there, Femi Adejuwon took her in, shut the door and forcefully violated her.

“She was later rescued in a pool of her blood,” he said.

The commandant said that the suspect later confessed to the crime after much interrogation, blaming devil for the act.

Ayuba, however, added that investigation was still ongoing on the matter and the suspect would be charged to court for justice to take its course.

The commandant, therefore, advised all parents and guardians to watch over their children or wards, especially during this Covid-19 lockdown.

Ayuba also admonished youths to shun all social vices such as rape, theft, cultism, vandalism, riot among others in the good interest of the state.

NAN

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BUSINESS DAY

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

In association with briu@businessday.ng

08098710024

What recovery and death rates mean for regions hit by COVID-19 ADEMOLA ASUNLOYE

A

midst the terrifying figures of infected cases and deaths of the novel coronavirusCOVID-19, some indicators are quite significant to tell the success stories of the Fight Against COVID-19 (FACOVID).

These are the recovery and death ratios.

The recovery rate is an appraisal metric that tells how countries and continents preserve the FACOVID. From a scale of 1% to 100%, the higher the rate the more robust the countries/continents are against COVID-19. Whereas, a low recovery rate tells whether there are more deaths or more active cases in a country or region.

Recovery ratio on the other hand measures the number of infected people that have now recovered against the disease. It further tells us if more people are dying than they are recovering in a given country or continent relative to others.

Across the world, countries continue to carry out more tests on citizens geared towards curbing the spread of COVID-19, with some countries implementing fumigation exercises continue across cities. Worldwide, there have been about 15.2 million people who have been tested for COVID-19 as at 7:55am of April 14th 2020—this will be the reference date for this analysis.

From the results of these tests, 1,926,147 persons representing 12.67 per cent of the total tests carried out worldwide tested positive for the COVID-19, leaving the remaining 87.32 per cent,

or 13,268,682 persons COVID-19 free.

The number of infected persons also included those on the high seas as it was in the case of Ms Zaandam and Diamond Princess, both which are cruise ships, but had cases of the virus.

Of the six continents with cases of COVID-19, Oceania recorded 54.49 per cent recovery rate, which is the highest rate so far, by showing great hope for other countries as they embattle the virus.

Followed closely is Asia, with a recovery rate of 48.64 per cent: this is a huge success and a great motivation for the region, particularly China (94.52 per cent) which was the source of the virus.

The continents of Africa, South America and North America are at

Source: Worldometer, BRIU

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the other extreme end with insignificant recovery statistics. While Africa with infected cases in 52 countries recorded a low recovery rate of 19.10 per cent, with some countries with as low as less than 1 per cent recovery rate, South America recorded 17.94 per cent rate, although some of its countries recorded not less than 1.6 per cent, and this implies that the impact of the FACOVID was lesser than that of Africa.

By number of recovered persons alone, South America with 9,871 persons out-numbered Africa (3,045 persons) by 6,826 recovered persons, yet this does not tell the whole story of their progress which is relative. However, the recovery rate metric gives detail to the ambiguity surrounding the report of recovered persons across the globe.

The continent with the least recovery rate based on recovery data is North America at 7.55 per cent. The total/positive cases in this region/continent are next to Europe with 627,674 infected persons as at the reference period/ time; sadly, only 47,417 persons (7.55 per cent) had recovered. The lowest recovery rate in this region shows that either there are more active cases or more deaths; but available data shows that there are more active cases of 555,105 persons as at the reference time.

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In recent times, increasing death tolls around the world has spread fear among the people. As disheartening as this is, it is also pertinent to share the recovery testimonies around the world.

52.49 per cent and a death rate of 0.89 per cent, little wonder the region has the highest recovery rate when compared with other continents.

Next is the cruise ship category which are Ms Zaandam and Diamond Princess cruises, that recorded recovery rate of 45.6 percent, that it, for every 1 death about 46 persons had recovered.

Since it is not a continent, much emphasis would not made on this.

Asia trails Oceania with a recovery rate of 13.3 percent, owing to more recovery testimonies from countries like China with a recovery rate of 23.3 percent. This means that for every 1 death recorded in Asia, 13 persons must have recovered. Asia, as at the reference time had a record of 151,380 recovered persons out of the total 311,200 persons who tested positive for the virus (COVID-19). The region’s recovery rate is 48.64 per cent while death rate at 3.65 per cent, and is expected to continue to decline as the FACOVID continues.

Source: Worldometer, BRIU Other continents as at the refer-

Source: Worldometer, BRIU

Oceania might have recorded recoded the highest recovery ratio at 58.9, Australia with 57.3 recovery rate accounted for most of the success stories in that region. This means that for every 1 death from COVID-19 in that Oceania, about 59 persons had recovered.

The analysis of the cases in the Oceania showed that recovered cases (4,123) are 5,980 per cent of total deaths (70), and from a total 3,662 active cases in the region, only 84 cases are termed critical, leaving the remaining 3,578 cases as mild. With a recovery rate of

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ence time have a recovery ratio of less than 4.5. This is not good news for these continents as it implies that few people are recovering as the death tolls continue to rise in those countries.

In all, North America has the least recovery rate among other continents, including Africa. The region’s recovery rate stood at 1.9 which invariably indicates that death and recovery in this region have a 1 to 1 relationship. Another interpretation is that the probability that an infected person will survive in this region is about 50-50.

Thursday 16 April 2020

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How location data can assist health authorities in curbing the community spread of covid-19 in Nigeria CHUKWUYERE IZUOGUIzuogu

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he coronavirus diseases otherwise referred to as COVID-19 is now an epidemiological nightmare hopping from one country to another since when it was first detected in Hubei province of China on 17 November 2019. COVID-19 was declared by the world health organisation as a public health emergency on 30 January 2020 and recognised as a pandemic on 11 March 2020.

Unfortunately, COVID-19 has found its way into Nigeria since 27 February 2020, when patient zero, a 44-year Italian national was the first confirmed case diagnosed of this infectious disease in Lagos state. As at the time of this writing, Nigeria has 224 confirmed cases of COVID-19 spread across 13 states of the federation and the federal capital territory. The federal and state governments, and health authorities have enacted several regulatory and administrative measures to contain the spread of COVID-19, prominent among them are the so called lockdown measure, a form of social distancing that restricts the movement of persons within a pre-defined geographic area and contact tracing of persons suspected to have come into contact with confirmed COVID-19 cases.

In this article, I explain how location data acquired from a network operator can be used by health authorities in their strategy for curbing the community spread of COVID-19 in Nigeria, and how the data processing risk arising from this strategy may be overcome.

What is location data?

Location data is information acquired by a network operator which indicates the precise geographical position of the terminal or mobile device of the user of the network operator’s communications service. Location data would in most cases indicate the latitude, longitude and altitude of a user’s device. In mobile communications networks, location data indicating the geographic position of a user’s device is used for enabling the transmission of

communications in an area of coverage of a network operator.

of confirmed cases about the risk of an infection, and the need to go into self-isolation or quarantine.

Potential uses of location Several researches have condata in curbing the spread cluded that location data obtained of COVID-19 from a network operator is an Contact tracing for the pur- invaluable tool for observing the pose of quarantine digital footprint of a communicaContact tracing as a strategy tions user and can indeed be a used by health authorities during good proxy for a network of facean epidemic significantly contains t0-face interactions as an effective the spread of an infectious agent. and efficient method of contact The traditional method of contact tracing. It should be borne in mind tracing employed is to reconstruct that this is not a novel method of the network of face-to-face in- contact tracing as it is presently teractions with confirmed cases, being contemplated (or used) in however this method is severely several jurisdictions. For instance, limited because it relies heavily Israel seeks to access the geolocaon a comprehensive knowledge tion data of confirmed COVID-19 of the pattern of movement of cases to find and identify people confirmed cases, and such infor- who came in close contact with mation will in most cases involve them and send them SMS directonly the travel history, commercial ing them to isolate themselves imfacilities visited and public trans- mediately. Towards the end of last portation used in which health month (March), it was reported officials may be unable to trace that the mobile phone industry all possible contacts. Moreover, is contemplating the creation of confirmed cases required to self- a global data-sharing portal able report such information may in to track an individual across the certain circumstances be unwill- globe in order to be able undertake ing to make a full disclosure es- contact tracing for the purpose of pecially if such information is of identifying a person whom cona private nature. Because of this firmed cases of COVID-19 may challenge, the health authority is have come into contact with. not able to alert potential contacts

Practical steps to improving

INSIDE the three key segments of the electricity supply industry in18

COVID 19: Tips to keep your legal business stable

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To better understand the pattern of spread of COVID-19 Location data is also an invaluable tool in epidemiological studies, as it helps health authorities to better understand the pattern of spread of an infectious disease.

Presently in the US, health authorities at the federal and state level, including the Centers for Disease Control and Prevention (CDC) are tracking the movement of users of communications service to better understand how COVID-19 is spread. This use case scenario presents health authorities with information of instances of mass movements, for instance whether people are still going about their daily work schedule and/or where large numbers of persons are congregating. In this way, epidemiologists are able to make a determination regarding the health risks associated with such movements and to accordingly advice governments on the appropriate form of social distancing required to mitigate the spread of an infectious disease. In addition, such information concerning the pattern of spread of COVID-19 will assist health authorities in forecasting the logistical resources and increment in hospitals required for managing potential and confirmed cases within a specific geographic area.

To observe whether individuals are complying with the lockdown measures Location data also provide an insight into whether individuals are complying with lockdown measures put in place to contain the spread of an infectious disease. An example of a use case is Google’s COVID-19 Community Mobility Report which uses anonymised location data obtained from individuals that have agreed to share their location to observe how busy certain types of places are, thus informing health authorities whether people are complying with the lockdown measures. This Report for Nigeria shows that as at 29 March 2020, there was a +15% increase in movements to residential places, thus indicating that more people are staying at home. Social distancing strate-

COVID-19 and Commercial Transactions: Some Emerging Legal Issues

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gies such lockdown measures will significantly contain the spread of COVID-19.

Overcoming the data protection risk The use of location data as explained above raises significant privacy and data protection risks.

In Nigeria, the applicable legal regime governing the processing of personal data is the Nigerian Data Protection Regulations 2019 (NDPR) issued by the National Information Technology Development Agency (NITDA). Location data and the disclosure of location data by network operators to health authorities and/or use of location data by health authorities in this circumstance respectively constitute “personal data” and “processing” within the meaning of the NDPR, thus the provision of the NDPR will apply in this case.

In this use case scenario, it should be noted that location data have been explicitly stated to be a type of personal data under the NDPR, and that two forms of processing takes place. At the first level is the disclosure of location data by network operators to health authorities and at the second level is the use of location data obtained from network operators by health authorities as part of their strategy for curbing the community spread of COVID-19.

Under the NDPR, the processing of personal data is lawful and hence will be permissible, if at least one of the legal grounds specified by the NDPR applies. Thus, for the processing of location data to be lawful in this circumstance, network operators (and/or health authorities) simply need to identify at least one lawful basis prior to the data processing transaction.

One of the legal basis that can be relied upon in this circumstance is “processing is necessary for the performance of a task carried out in the public interest or in the Continues on page 19

Chukwuyere, formerly a Tech Policy Fellow at Mozilla Foundation and presently a Research Fellow at the

African Academy Network on Internet Policy and Senior Associate at Streamsowers & Köhn.

Chinese medical team visit: a cursory look at the extant provisions of the law

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Thursday 16 April 2020

BUSINESS DAY

POWERPERSPECTIVE with AYODELE ONI

BD

LegalBusiness

Practical steps to improving the three key segments of the electricity supply industry in Nigeria: Improving the attractiveness of the Nigerian electric power sector

D Proem:

espite the substantial privatization of the generation and distribution segments of the electricity supply industry, in Nigeria and the involvement of private sector management of the transmission system (albeit for three years) in Nigeria, not much progress has been felt in terms of availability of affordable electric power or indeed, even expensive power supply.

The assumption during the subsequent privatization process was that the sector would improve substantially. The restructuring and privatization commenced with the approval by the federal government of Nigeria, of the national electric power policy around 2001 with more substantial steps taken between 2010 and 2013, when the physical handover of the electricity utilities to the private sector took place.

In fact, it was believed at that time, that the electric power sector in Nigeria was open for business and investors, especially international ones, would battle one another to invest throughout the electric power value chain, especially as relating to electric power generation and distribution.

This expectation failed quite abysmally with only pockets of investments in mostly off-grid power supply and even that has failed to see much traction compared to the prospective value that could be derived from same.

This paper looks at practical issues adversely impacting each segment of the sector- namely, the generation, transmission and distribution segments and provides practical, and not necessarily popular, solutions to such challenges. This paper will, thus, throw some light on what practical steps could or should be (or continue to be) taken to really improve the sector rapidly and have investors, especially international investors, battle one another to invest in various segments of the sector and also generate strong interest in the services and support aspects of the sector.

cost-reflective tariffs have resulted in the DisCos’ income falling far below their projected earnings and the revenue necessary to sustain the DisCos’ operations and the operations of the other segments of the electricity value chain.

Putting this into perspective; for every One Hundred Naira (N100) worth of electricity that DisCos receive from GenCos, through the Nigerian Bulk Electricity Trading Company (“NBET”) for electricity sold to consumers, the DisCos are only able to retrieve Fifty Naira (N50) as income from consumers. This has a domino effect, as it limits the ability of the DisCos to pay NBET for the electricity supplied to them. This leads to an insufficiency of funds available to NBET to pay the GenCos for electricity supplied under power purchase agreements (“PPAs’) and available to the GenCos to pay gas suppliers, as a significant amount of electricity in Nigeria is generated from gas. In effect, the inefficiency of DisCo revenue collection cripples the entire electricity value chain and if the situation is allowed to fester, power generation and supply would eventually cease.

Practical Issues Adversely Impacting the Segments within the Sector: The first and most important point is that in the ideal Nigerian Electricity Supply Industry (“NESI”) set up, money would flow from the electricity distribution companies (“DisCos”), upwards to the Transmission company of Nigeria (“TCN”) and the generation companies (‘GenCos”). That is, after tariffs are received by Discos, from consumers. However, a plethora of problems ravaging the DisCos including electricity theft due to fraud, wrong value systems and connivance between electricity consumers and Discos’ staff, decrepit infrastructure and lack of

The Cause of the Problem Each stakeholder in the NESI has a certain level of culpability for the inefficiency in the electricity market and in revenue collection by the DisCos. Customers contribute to the problem, through widespread electricity theft. Electricity theft refers to methods through which customers tamper with existing electricity infrastructure to enable them obtain electricity for free or at costs not commensurate with their electricity usage. This is often through reconfiguring meters to give incorrect readings or connecting directly to the overhead distribution cables. The net result is that DisCos incur substantial operatwww.businessday.ng

ing costs to supply electricity to a large number of consumers for free, making it difficult for DisCos to recoup their operating costs.

The fault of the DisCos lies primarily in their inability to adequately meter customers, despite clauses in their performance agreements with the Bureau of Public Enterprises and the Ministry of Finance Incorporated mandating them to do so and several directives by the Nigerian Electricity Regulatory Commission (“NERC”) ordering them to do so. Research conducted by NERC on the level of metering in Nigeria at June 2019 shows that only Three Million, Eight Hundred and Eleven Thousand, Seven Hundred and Twenty-Nine (3,811,729) out of Eight Million, Eight Hundred and Eighty-One Thousand, Four Hundred and Forty-Three (8,881,443) DisCo customers were metered. This leaves the metering gap at a staggering rate of fifty-seven per cent (57%). The metering gap will continue to increase as the number of customers increase, unless significant efforts are deployed to roll out meters to customers.

Inefficient metering affects the ability of DisCos to properly charge customers for the amount of electricity consumed. Although, they have deployed estimated billing as a way to reduce the effects of the lack of meters, this has not always been efficient and recent orders by the NERC cap the amount of estimated bills which may be charged by DisCos and will eventually preclude DisCos from issuing estimated bills to unmetered customers from April 30, 2020.

The Federal Government’s culpability arises from its failure to upgrade the transmission infrastructure, secure the prompt settlement of electricity bills by its ministries, departments and agencies (“MDAs”) and the Nigerian Electricity Regulatory commission delay in implement-

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ing a cost-reflective tariff. Electricity tariffs need to be reflective of the underlying costs incurred in generating and supplying electricity, to allow companies along the value chain to recoup their operating costs and earn a reasonable profit.

NERC has been doing a reasonably good job to implement steady increases in tariffs, whilst still being considerate of the plight of consumers. It released the 2016-2018 Minor Review of the Multi-Year Tariff Order 2015 and Minimum Remittance Order for the Year 2019 (“MYTO 2019”) to update the methodology for determining tariffs in line with current market realities and provide for a gradual increase in tariffs to achieve a cost-reflective tariff. Nevertheless, current tariffs need to be much higher than they are in order to attract any investment. With the current electricity tariffs, the cost of generating, transmitting and distributing each unit of electricity is higher than the sale price which is discouraging to investors.

The poor state of the transmission infrastructure, results in an unusually high percentage of generated electricity being lost at the transmission phase and the inability of present infrastructure to evacuate the electricity generated by GenCos for transmission to the DisCos, this is coupled with the fact that the current transmission infrastructure covers only about forty (40%) of the country.

The lack of adequate funding prevents regular maintenance and necessary upgrades to our transmission infrastructure.

The Role played by GenCos Generation on its own has not constituted much of a problem to Nigeria, as the main problems with GenCos arises out of the issues with DisCos highlighted above. Their main issues arise from gas supply and availability of funds to pay gas suppliers.

As highlighted above, a major source of power generation in Nigeria is gas and the government has implemented significant measures to improve gas availability for power generation.

This includes the work on the the Ajaokuta-Kaduna-Kano (“AKK”) pipeline currently being considered, to transport gas from Ajaokuta to Abuja, Kaduna and finally Kano and will increase the supply of gas necessary for power generation in Nigeria. Additionally, the Nigerian Gas Transportation Network Code which became effective from February 10, 2020 will hopefully provide open and competitive access to gas transportation infrastructure and the development of the domestic gas market in Nigeria. The Nigerian Gas Flare Commercialisation Programme will also reduce the gas wastage and increase the @Businessdayng

supply of gas by ensuring that gas which is often flared (actually wasted, literally) through gas flaring can be captured for economic uses.

It is, therefore, necessary to resolve the problems of revenue collection by the DisCos. Due to the level of interconnection and dependence of all three segments of the electricity sector, the resolution of the problems with DisCos and the transmission infrastructure will promote increased and more efficient electricity generation. If DisCos are paid cost reflective tariffs for all the electricity supplied to consumers, this will have a positive effect up the value chain and serve to guarantee adequate and attractive revenue for GenCos. This would increase their credit worthiness and attract greater investment. I must state that the Regulator, NERC and especially Commissioner Dafe Akpeneye, are already doing a great job, with that.

Practical Solutions to Improving the Electricity Market in Nigeria One of the most important steps is to for NERC to speed up the process of implementing cost-reflective tariffs, like it had already started. To combat the inevitable consumer outcry which will result from an increase in tariffs, the increase process should be combined with policies and public campaigns aimed at reorientating consumers on energy efficiency and measures which can be implemented to reduce energy consumption including use of compact fluorescent light (“CFLs”) or Light Emitting Diodes (“LEDs”) for light. This could also continue to create a market for energy saving electrical appliances. It is germane to note that, the tariff increases should also come with additional obligations on DisCos to ensure reduction of the aggregate technical, commercial and collection losses through technology, personnel and adequate metering of customers.

In addition, the balance of the Two Hundred and Three Billion Naira Central Bank of NigeriaNigeria Electricity Market Stabilisation Facility (CBN-NEMS) facility, which was set up to address shortfalls in power sector revenues, should be completely disbursed to the DisCos, GenCos and gas suppliers to provide these sectors with the necessary liquidity to fund operations. Reports show that as at October 2019 only about One Hundred and Eighty-Three Billion out of the Two Hundred and Three Billion had been disbursed to the market participants.

To be continued next week Dr. Ayodele Oni (ayodele.oni@bloomfield-law.com), an attorney, is a commercial lawyer specializing in international energy (oil, gas, power & mining) investment law.

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How location data can assist health authorities..

Continued from page 17

exercise of official public mandate vested in the controller” set out in Art. 2.2 (e) of the NDPR. It is interesting to note that the General Data Protection Regulations (GDPR) applicable in the EU has a

similar provision in Art. 6 (1) e which according to Recital 46 can serve as a lawful basis for processing personal data for the purpose of “monitoring epidemics and their spread” among many other purposes. Recently on 19 March 2020, the European Data Protection Board (EDPB) adopted a statement reaffirming that personal data may be used by competent public health authorities in the context of an epidemic such as one relating to COVID-19 (However unlike Nigeria, EU has a special rule concerning the processing of location data).

In the light of this, it is my opinion that Art. 2.2 (e) can safely be relied upon in this circumstance as a lawful basis for processing location data considering the epidemiological concerns of COVID-19 and the health risks it poses to the general population.

Conclusion

Data protection concerns in matters of public health continues to be an ongoing debate, especially during the outbreak of an infectious disease.

Although several data protection authorities have come to realise that data protection rules should not be used to impede measures taken by public health authorities in curbing the spread of an infectious agent, especially if this can be justified on a public interest basis. Even the Constitution which is the Grundnorm of the Nigerian society recognises that the right to privacy is not absolute but may be derogated from in deserving circumstances. In any case, the use of personal data in this circumstance must be narrowed by the data protection principle of purpose specification which requires that the use of location data is confined to only the monitoring and containment of COVID-19, otherwise the government and health authorities would be acting outside the boundaries set by the NDPR and ultimately overreaching themselves.

Infectious diseases are a scourge to humanity, where modern technologies are used to mitigate their effects, it must be done in accordance with laid down rules in order to legitimise the use of such modern technology.

COVID 19: Tips to keep your legal business stable Continued from last week

THINKING OUTSIDE THE BOX esperate times they say, call for desperate measures. In these dire times caused by the rise of a pandemic, it is important for legal businesses to be more innovative and proactive; with a mindset that seeks ways to keep their law firms and organisations running.

For a start, your website can be more engaging and interactive to allow for more experiential visits by visitors and prospective clients to your site. You can also create a ‘Call to Action” on more than one page on the website. Ensure optimization for all searches relating to the firm, its lawyers and its practice units.

D

COST-SAVING Many businesses have been adversely hit by the impact of the pandemic and legal businesses

are not left out, as they also experience significant decline in revenue and a radical transformation in their operations. With these developments, law firms are faced with hard decisions to keep the business afloat; struggling against layoffs and reduced employment.

In order to steer through this crisis without disrupting your financial projections, you could start by rethinking and optimizing spending. Reprioritize tasks and planned projects. Manage accounts receivables, collect as much as possible from outstanding clients. Manage your cash reserve. Reforecast your business with various downside scenarios and reduce your revenue projections.

CONNECTING & SCALING Get into the remote environment and build connections.

Network and connect more with potential clients and busi-

ness partners. Explore new channels for building your network and growing the business.

This is our current reality and could be prolonged for all we know. Make the most of it. Do not miss an opportunity to scale.

FINAL NOTE Achieving efficiency with teams situated in multiple informal locations is not such an easy task. However, as “WE” all get accustomed to remote work, we will continue to discover more ways to communicate and connect better with colleagues; we will automate better, save more time; work more efficiently and build a larger and stronger network for business growth.

Here’s to Healthy Remote Work (HRW), as we look forward to the victories ahead.

LB Editor Mails to the editor at: legalbusiness@businessday.ng theodora@businessday.ngw

COVID-19 and Commercial Transactions: Some Emerging Legal Issues Continued from last week Construction & Mining perators in the construction sector and their clients have had to face serious interruptions to the performance of their contractual obligations. In most cases, importation of construction materials has been stalled with material adverse effects on building projects and concession contracts.

This will either elongate agreed durations for, or completely frustrate the performance of, infrastructure projects earlier awarded. In the same vein, mining agreements such as leases and licenses are expected to suffer serious performance crisis, particularly where expatriate workers from foreign countries are required or where heavy machinery are required to be imported for exploration and exploitation purposes. Will they still be entitled to payments and/or liable for delayed performance?

O

Healthcare Enterprises engaged in the health sector are significantly affected by the pandemic. With hospitals running out of drugs, test kits and protective masks, and pharmaceutical companies (particularly in Africa) unable to either import drugs or raw materials from affected producing countries around the world; there is pressure on the supply side of the market with many pre-COVID-19 arrangements/orders disrupted.

Will health care providers be liable for negligence arising from inability to provide adequate treatment to patients due to shortages caused by COVID-19?

African Trade The ravaging impact of COVID-19 is becoming increasingly felt in Africa only about three (3) months to the take-off date of the African Continental Free Trade Area. The Agreement

establishing the AfCFTA was signed on March 21, 2018, in Kigali, Rwanda and it came into force on May 30, 2019. As highlighted in a Special Issue of our Grey Matter Tax Alert in January 2020, the AfCFTA created a single market for the free movement of goods, services and persons within the continent, with the vision that capital, investments and technology will flow across the continent unimpeded. The COVID-19 pandemic is likely going to affect the take-off as well as the objectives of the AfCFTA, should the pandemic persists.

As a consequence of all of the foregoing, the nature/scope of the provisions in underlining contracts for business entities’ obligations have come to the fore of the conversations, as consequential adjustments to the various commercial arrangements/ agreements becomes imperative.

POSSIBLE / RECOMMENDED APPROACHES Force Majeure Most commercial agreements contain force majeure clauses, included to protect the positions of parties to such agreements, in case certain events (defined in the agreement) occur to prevent performance of contractual obligations. Such circumstances usually include natural disasters, otherwise known as “acts of god”, such as earthquakes, tsunamis, plagues or “serious epidemic”. Force majeure events can also include “acts of man” which are reasonably unforeseeable and disruptive in nature, such as an industrial action.

In effect, a force majeure event will relieve a commercial entity, that is unable to perform under a contract www.businessday.ng

due to circumstances outside of its control from obligation. Thus, commercial entities who have failed to perform any of their contractual obligations, as a result of the COVID-19 pandemic, may be able to invoke the force majeure clauses in their commercial agreements; to avoid liability for non-performance. However, where “Coronavirus outbreak” is not contained in the list of defined events in a contract, it is assumed that the current pandemic should qualify as a force majeure event under the umbrella “serious epidemic”, a phrase commonly inserted in commercial agreements.

For contracts containing no force majeure clauses, commercial entities could result to invoking the common law principles of supervening impossibility or frustration, to avoid huge liability for non-performance. However, the availability of this principle would depend on the applicable law to such contracts.

Whether COVID-19 will find application under the general term, “serious epidemic” or will be adjudged a supervening event by operation of law, depends substantially on the construction of the underlining contract, the applicable laws and the unique facts and circumstances of each case. At any rate, commercial entities should consider specifically including a pandemic, such as Coronavirus, in the definition of force majeure events in future contracts.

Insurance Policy Commercial entities having “AllRisks Insurance” and “Special Perils Insurance” as well as “Consequential Loss Insurance” and the like, should review the terms of such policies or

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seek appropriate professional advice, on whether the current Coronavirus scourge could be accommodated in the risks insured against.

For instance, insured manufacturing companies may benefit under a “Plant-All-Risk Insurance Policy”, as a result of the lockdown in many cities of the world, preventing their operations. In like manner, construction companies may be able to make claims under a “Contractor-All-Risk Insurance Policy”.

However, for “Special Perils Insurance Policies”, it is not clear whether the damage/disruptions caused by the COVID-19 outbreak could amount to special perils. Similarly, it is not clear whether insured commercial entities who have suffered loss of revenue/profit in the wake of the Coronavirus pandemic could claim under a “Consequential Loss Insurance Policy”.

The quantum of claims possible under the various insurance policies will depend on the construction of the insurance contracts. It is necessary that commercial entities negotiate future insurance policies, with a pandemic like the COVID-19 in mind.

Business Continuity Plan The COVID-19 pandemic is changing the world of work. For enterprises without a contingency plan, the economic adverse effect of the pandemic could be extremely devastating. In view of present realities, commercial entities should invest in system automation whereby services can be provided remotely to their clients or customers, in times of natural disasters, widespread plaques or lockdown. For entities relying on delivery of services, the inclusion of provisions in the contract obliging the service provider to have a robust business continuity plan will be important.

Well negotiated commercial and insurance contracts, that will adequately take care of business @Businessdayng

disruptions and ensure continuity of businesses in the post-crisis period, without losing vital business relationships are crucial. This is imperative for commercial entities, particularly those whose services may not be possibly rendered virtually; such as enterprises in the construction, manufacturing, transport & logistics sectors.

CONCLUSION In conclusion, commercial entities are enjoined, in the light of the global reach of the COVID-19 pandemic and the attendant unprecedented disruptions to businesses, to consider seeking proper legal advice on: Which existing contracts may be impacted by the ubiquitous restrictions and lockdown on businesses, or where a counterparty may lawfully seek to terminate or suspend a contract; The employment obligations and/ or liability that may crystallize by reason of the current pandemic and how to mitigate against same; Appropriate steps to mitigating the risks associated with Coronavirus or outbreak of similar epidemic in future contractual relationships/ commercial arrangements; Building an effective Business Continuity Plan within the context of extant applicable laws; and Whether a force majeure event applies to specific contracts to which they are parties or what reliefs may be available, in the circumstance.

The Grey Matter Concept is an initiative of the law firm, Banwo & Ighodalo DISCLAIMER: This article is only intended to provide general information on the subject matter and does not by itself create a client/attorney relationship between readers and our Law Firm or serve as legal advice.

Specialist legal advice should be sought about the readers’ specific circumstances when they arise.

20

Thursday 16 April 2020

BUSINESS DAY

PERSPECTIVE

BD

LegalBusiness

Chinese medical team visit: a cursory look at the extant provisions of the law OWOWO CALEB

T

he recent announcement by the minister of health Dr. Osagie Ehanire, of the visiting 15 medical personnel from China no doubt, raised eyebrows and condemnations. According to the minister, the medical personnel who are said to be experts in infectious diseases, respiratory illness, intensive care, cardiology, neurology, general surgery and anesthesiology would arrive with drugs and equipment to carry out COVID-19 tests on the staff of the China Civil Engineering Construction Corporation (CCECC) - the main contractors handling the rail modernisation programme of the Federal Government, facilitating the assistance of the experts and they will come with medical equipment from China for this purpose.

This announcement by the minister of health attracted criticism and rejection from relevant stakeholders in Nigeria’s healthcare sector. Notably, the Nigeria Medical Association (NMA), The Nigeria Association of Resident Doctors (NARD), and the Lifeline Centre for Medical and Health Right Advocacy (Lifeline Centre) - led by the amiable Professor Uwakwe Abugu.

Despite these protests and outright rejection of the visit, they landed in the country and are already hibernating in isolation for the next 14 days before they can carry out the object of their visit. It is a fact that no representation or rejection statement was made by the Medical and Dental Council of Nigeria (MDCN), after the minister through the media announced this visit.

The extant provisions of the law The Medical and Dental Practitioners Act (MDPA)Cap M8 LFN, 2004, is the extant law for the registration of foreigners for the purpose of practice of medicine in Nigeria. Section 1(1) of the Act established the Medical and Dental Council of Nigeria (MDCN), being the statutory body charged with the training and qualifications of doctors, their registration and discipline.

The Medical and Dental Council of Nigeria pursuant to the powers conferred on it by the Act, the Council promulgated the Code of Medical Ethics, 2008, pursuant to sections 6(3), 18(2) of the Medical and Dental Practitioners Act. The Code of Medical Ethics in Nigeria, 2008 governs the rules of professional conduct for medical and dental practitioners in the country.

Control of the council by the minister Section 4 (1) (2) (3) of the Medical and Dental Practitioners Act thus: “The minister may give to the council directions of a general character or relating generally or relating generally to particular matters( but not to any individual persons or case) with regard to the exercise by the council of its function under the Act and it shall be the duty of the council to comply with the directives”.

“Before giving a direction under subsection 1 of this section, the minister shall serve a copy of the proposed direction on the council and shall afford the council an opportunity of making representations to him with respect to the direction”. “ The minister may, after considering any representations made to him in pursuance of subsection (2) of this section, give direction after without modification or with such modifications as appear to him to be appropriate having regard to the representations”.

Accordingly, the minister of health pursuant to the said section had informed the council ( who has statutory powers to make representations in support not opposition ), and all Nigerians of the visit of Chinese medical team to Nigeria, and there was no outright objections , representations to the minister from the council, opposing the planned move, hence, the eventual arrival of the Chinese Medical team. The next duty of the council is with respect to certification and registration of the Chinese medical team at the expiration of their 14 days hibernation in isolation. By section 6(3) of the Medical and Dental www.businessday.ng

Practitioners Act, the council (MDCN) are saddled with the following functions.

(1) Registration of medical, Dental and alternative medicine practitioners

The registrations are of two types: A. Provisional registration: This is given to fresh medical or dental graduates, to enable them undergo the one-year training as house officer and obtain the certificate of experience.

B. Full registration is given by the council upon successful completion of one-year tutelage as a house officer. The doctor is now eligible for full registration; full registration entitles the Practitioners to practice anywhere in Nigeria; and issue a valid document in cases where such a document is required to be signed by a medical or dental practitioner, etc.

C. Additional registration - doctors who after full registration have undergone additional training in a post- graduate specialty duly certified by a professional body recognized by the medical and dental Council of Nigeria, is entitled to be registered in that specialty.

D. Limited or temporary registration: This type of registration is granted to expatriates doctors wishing to practice medicine or dentistry in Nigeria, to qualify for limited registration, a practitioner must be an expatriate and have been selected for a specific employment for a specified period in approved in an approved hospital or Health facility.

Expatriate doctors working in Nigeria on humanitarian ground or who come to render humanitarian medical services

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in Nigeria are required to get limited registration and annual practicing license from the medical and dental Council of Nigeria before they can render such medical services, no matter the brevity of their engagement.

This is the practice worldwide and is designed to protect the recipient population, to ensure the so- called practitioners are qualified to practice medicine in Nigeria.

Furthermore, Section 13(1) of the Medical and dental practitioners Act, provides thus: “ Where a person satisfies the council, that he been selected for employment for a specified period in an approved hospital or as the case may be, in any other approved institution in Nigeria in the capacity of a practitioner of medicine, surgery, dental surgery or midwifery and that he is or intends to be in Nigeria for a limited period for the purposes of serving that period in the employment in question; And that he has passed the assessment examination, if any, of the council following some qualifications granted outside Nigeria which is for the time being accepted by the council for the purposes of this section as respect the capacity in which if, employed, he is to serve , the council may if it thinks fit, give a direction that he shall be registered for a limited period as a medical practitioner or as a dental surgeon, as the case may be”.

Accordingly, the law on the registration of foreigners for the purpose of practicing medicine in Nigeria as set out in the Code of Medical Ethics 2008, is clear and unambiguous.

Rule 7 of the Code provides the guidelines for the registration of non-indigenous medical and dental practitioners. In summation, it provides thus: “For the purpose of clarity, non- indigenous medical and dental practitioners shall be defined as all medical and dental practitioners be they Nigerians or not, who are trained shall be regarded as indigenes of the professions and shall be accorded all benefits due as to their Nigerian counterparts.

A. Registration. All foreign qualified doctors wishing to practice in Nigeria must sit and pass the assessment (proficiency) examination before seeking registration with the medical and dental Council of Nigeria.

B. Limited registration: A success in the proficiency examination qualifies foreign trained doctors to proceed to provisional registration for Nigerian citizens and a limited registration for non- Nigerian.

C. Humanitarian doc@Businessdayng

tors - All medical and dental practitioners wishing to render health services are welcome.

However, short or long the period of such service may be, it is mandatory; in the case of expatriate doctors that a limited registration and practicing license, as the case may be; should be obtained before undertaking such exercise.

It shall be the responsibility of the individual or organization (in this case CCECC), responsible for bringing in such doctor to ensure that they are duly registered and licensed prior to their arrival in Nigeria. The laws governing doctors with limited registration are well spelt out. It is advisable that such an expatriate doctor familiarizes himself with the rules before taking up any job. A practitioner on the limited register shall not own or manage facility in Nigeria. He can only take up employment in the institutions to which he is registered. It is disheartening that some expatriate doctors abuse the terms of their limited registration.

It is recommended that the 15-man Chinese medical team should, at the end of their 14-day isolation, submit themselves to the Medical and Dental Council of Nigeria, (MDCN), so as to allow the council undertake proficiency assessment examination which if successful, will enable them apply for the necessary certification and registrations for limited registration. On the other hand, where they are found wanting or fail to pass the proficiency assessment showing that they are medical practitioners, the council should be bold enough to protect the health of Nigerians by making a clear representation of their findings to the minister of health and to the public.

Where this is done, the minister should accept their findings and not reject same because overruling the council’s findings may endanger the health of Nigerians and the minister should stop any possible collaboration the visiting Chinese medical team may have planned to have with the Nigeria Medical Association (NMA) in the fight against the COVID-19 pandemic – a fight which in my opinion, the Nigeria government, through the help of the NMA was winning before the call from the blues for collaboration with the Chinese Medical personnel.

OWOWO. C. CALEB, Esq. is a private legal practitioner based in Abuja. He is also the Chairman, Young Lawyers Forum, Nigeria Bar Association (NBA), Bwari branch.

Thursday 16 April 2020

Innovation

BUSINESS DAY

Apps

Fin-Tech

Start-up

Gadgets

Ecommerce

IOTs

21

TECHTALK

Broadband Infrastructure

Bank IT Security

5G’s health risks, myth or real fears?

FRANK ELEANYA

R

ecently, the Nigerian government w a s f o rc e d t o clarify that it had not issued any licence for 5G deployment, after thousands of its citizens took to social media to express their views on allegations that the government was laying 5G cables across the country while people stayed in-doors.

A variant of the public conversation was that 5G radiation could be responsible for the coronavirus pandemic.

But Ali Isa Pantami, Minister of Communication and Digital Economy dismissed the connection in a recent interview with Channels Television.

“When it comes to health, we have (the) World Health Organisation and many health bodies,” Pantami said.

“I just want you to bring out any research which they have conducted and (in which they) made their position about 5G’s relationship with COVID-19. I am yet to see anyone from the World Health Organisation.”

While the link to coronavirus may be unfounded and a bit exaggerated, there are real fears that people’s health could be at risk in a 5G world.

Some of those fears have seen protesters burn down cell towers in the UK and the Netherlands.

It has also led to petitions from scientists and doctors for greater health protection on non-ionizing electromagnetic fields (EMF).

As of October 15, 2019 over 240 scientists and doctors from 43 countries have signed an appeal to the officials of the European Commission, warning about the danger of 5G networks, which they said will lead to a massive increase in involuntary exposure to electromagnetic radiation.

In the appeal, the scientists urged the EU to follow Resolution 1815 of the Council of Europe, asking for an independent task force to reassess the health effects.

“Wireless communication technologies are rapidly becoming an integral part of every economic sector. But there is a rapidly growing body of scientific evidence of harm to people, plants, animals, and microbes caused by exposure to these technologies. It is our opinion that adverse health consequences of chronic and involuntary exposure of people to non-ionizing elec-

tromagnetic field sources are being ignored by national and international health organizations despite our repeated inquiries as well as inquiries made by many other concerned scientists, medical doctors and advocates,” the EMF Scientists wrote.

What is 5G? 5G refers to the fifth generation of mobile networks.

Unlike previous generations, 5G is expected to elevate the mobile network to not only interconnect people, but also interconnect and control machines, objects, and devices.

It is also expected to deliver new levels of performance and efficiency that will empower new user experiences and connect new industries.

5G will deliver multi-Gbps peak rates, ultra-low latency, massive capacity, and more uniform user experience.

5G operates on three spec-

trum bands, low-band spectrum; mid-band spectrum; and high-band spectrum.

The health debates The fulcrum of the 5G debates has to do with radio frequency radiation (RFR).

RFR describes anything emitted in the electromagnetic spectrum, from microwaves to x-rays to radio waves to light from your monitor or light from the sun. To know whether a particular RFR is dangerous, scientists identify two categories, ionizing or non-ionizing radiation. Nonionizing is a radiation that is too weak to break chemical bonds. That includes ultraviolet, visible light, infrared, and everything with a lower frequency, like radio waves.

5G would employ millimeter waves for the first time in addition to microwaves that have been in use for older cellular technologies, 2G through

4G. In view of its limited reach, 5G will require cell antennas every 100 to 200 meters, exposing many people to millimeter wave radiation. 5G also employs new technologies (e.g., active antennas capable of beam-forming; phased arrays; massive multiple inputs and outputs, known as massive MIMO) which pose unique challenges for measuring exposures.

However, Simon Clarke, associate professor in cellular microbiology at the University of Reading, told the BBC on Sunday that while very strong waves can cause heating, 5G is nowhere near strong enough to have any meaningful effect.

“Radio waves can disrupt your physiology as they heat you up, meaning your immune system can’t function.

But [the energy levels from] 5G radio waves are tiny and they are nowhere near strong enough to affect the immune system. There have been lots of studies on this,” he said.

Nonetheless, there are still concerns that the effects of millimeter-wave signals from 5G might be more dangerous than traditional frequencies; and that the larger number of access points, some potentially much closer to people’s homes, might expose people to more radiation than 5G services.

A report from Wired which alludes to these concerns say the wireless industry is focused on using mid- and low-band frequencies for 5G because deploying a massive number of millimeter-wave access points will be time-

consuming and expensive.

In essence, 5G will continue using the same radio frequencies that have been used for decades for broadcast radio and television, satellite communications, mobile services, WiFi and Bluetooth.

In any event the industry opts to use higher-band frequencies, a report by Cornell University says that at higher radio frequencies, the skin acts as a barrier, shielding the internal organs, including the brain, from exposure. Human skin blocks the even higher frequencies of sunlight, they said.

A re t h e s e s u f f i c i e n t enough for Nigeria to declare 5G safe for Nigerians?

Dave Johnson, author of three books on technology and a vocal advocate for 5G, acknowledges that just because there is no known mechanism for non-ionizing radiation to have a biological effect, that doesn’t mean the technology is safe or that no effect exists.

“Indeed, researchers continue to conduct studies,” he wrote.

Joel M. Moskowitz, director of the Center for Family and Community Health in the School of Public Health at the University of California, Berkeley, writing in the Scientific American, suggested that 5G is a new technology, hence requires a comprehensive research on health effects.

“So we are “flying blind” to quote a U.S. senator. However, we have considerable evidence about the harmful effects of 2G and 3G.

to boast to neighbors or visitors of how innovative young people in the country had become.

Once in a while it threw money at it which helped a few well-connected tech firms to stay afloat. The rest clawed along, some have died while others who could afford the logistics set their hopes on Silicon Valley. As a result, nearly 90 percent of the funding tech firms have received so far have come from foreign investors. More important, the success the ecosystem has recorded so far is more thanks to the individual firms and the investors that saw their potential.

With coronavirus cases rising and spreading across the 36 states, the government may finally be convinced it can’t function in the 21st century without an efficient tech ecosystem driving it’s digital economy ambitions.

The country has 318 con-

firmed cases as of 09:30pm, Saturday, 11 April. 70 people have so far been discharged with 10 deaths recorded.

Governance is practically on lockdown with civil servants sent home to observe social distancing.

The government has had to fall back on tech products for meetings, communication, work monitoring, data collection, payments and healthcare.

Hence, the government needs to go deeper than making promises. One of the short wins that have come out of the latest plan to rescue start-ups, is at the instance of the minister of Communication and Digital Economy, the compilation of a list of tech start-ups providing essential services. Due to the list, workers in agritech and edtech firms considered essential are able to provide their services without restrictions to movement.

How to make FG’s palliative to tech ecosystem sustainable FRANK ELEANYA

T

he Nigerian government through the National Information Technology Development Agency (NITDA) has initiated a bold rescue plan to save the tech ecosystem from the devastating impact of the coronavirus pandemic.

But the plan is coming weeks after the coronavirus took a crushing toll on Nigeria’s economy which has left businesses of different sizes fighting for survival.

For many people, a lockdown was a matter of ‘when’ and not ‘if’. The government made it official in Lagos, Abuja and Ogun on the last Sunday of March, three days before NITDA set up its committee.

A lot was already happening with hundreds of tech businesses in Nigeria.

In an interview with Disrupt Africa, Tomi Davies, president of African Business Angels Network (ABAN) and who coincidentally is the chairman of the committee NITDA set up, said over 80 percent of start-ups in Africa are expected to fail as a result of the recession caused by the spread of the virus.

“Even high-quality startups are already having challenges raising equity financing and the resulting lack of working capital will mean having to lay off employees,” Davies said.

Start-ups have always been risky, designed to grow fast or die, but the coronavirus pandemic is turbocharging Nigeria’s tech ecosystem’s natural selection and causing a shake-up so sudden it has defied comparison.

NITDA had on 1 April, inaugurated a 10-Member Advisory Committee to advise Government on measures

to be taken to cushion the impact of the COVID-19 pandemic on start-ups, small and medium businesses as well as the Technology Ecosystem in general.

The committee constitutes many of the prominent voices and leaders in the ecosystem. While inaugurating the committee, Kashifu Abdullahi, the director general of NITDA said that members of the committee were carefully selected for their significant contributions to the ICT sector in general and the technology and innovation ecosystem in particular.

The committee was mandated to come up with a report in 48 hours, which they have since delivered.

According to a source who saw the report, there are about 20 recommendations which try to capture interventions for the short term and beyond the crisis.

One of the recommendations is a ‘digital first cloud first’ strategy meant to encourage deeper automation in governance and support remote work in Nigeria. The committee has also recommended the inclusion of IT companies in all intervention funds by the Central Bank of Nigeria.

“There are some tech policies that have been signed but not operated; we are trying to get them implemented using this crisis,” said the source.

But how far is the government willing to go to save the ecosystem this time? The IMF predicts the coronavirus pandemic will trigger the worst global recession since the Great Depression in the 1930s.

Prior to the pandemic, the government treated the ecosystem like a piece of decorative vase, only giving it attention when it needed

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

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22

Thursday 16 April 2020

BUSINESS DAY

BUSINESS TRAVEL

Path to restart the aviation sector after the COVID-19 pandemic – Expert Stories by IFEOMA OKEKE

W

ith global confirmed cases currently over 1.2million and deaths over 70,000 with USA, Italy and Spain toping the prevalence ratings, the world economy is definitely being affected by the COVID-19 pandemic.

Countries have responded with various strategies to stop, mitigate and contain this bio-security threat. The most common by most countries has been shutting airspaces, airports, hotels and many other business and social gatherings.

Many jurisdictions have restricted movements including travel ban of its citizens for fixed and varied terms whilst studying different ‘models’ to ascertain the containment of this contagion and national security threat. Over 180 countries have confirmed incidences or presence of Covid-19 infections within their borders.

No doubt the aviation subsector has been the target of direct endeavours, containment and mitigating strategies in global efforts to end the pandemic.

These containment strategies are already taking a huge toll on the industry as the International Air Transport Association (IATA) has announced that passenger airliners could lose up to $133billion in revenues this year. Aviation service providers including Airports, fuelling services providers, ground handling service providers, security services providers, catering services providers and many more would be badly hit this year 2020.

Seyi Adewale

Seyi Adewale, former acting managing director and the chief executive officer of Mainstream Cargo Limited noted that it is projected that there would be massive job losses, cancelation of existing contracts or its downward financial reviews, in order to mitigate or lower the impact of these losses.

Adewale projects that only organisations with good financial reserves or assets would survive without government stimulus packages (interventions) designed for the subsector through grants, tax waivers, loans to limit the negative impact of the COVID-19 crises.

He stated that airline shares are rapidly tumbling as the bear markets have taken over globally. For example, GE Aviation arm has cut 10 percent of its workforce as a grand plan to save $500Million - $1billion in the current

financial year.

British Airways (BA) has indicated that the Coronavirus crises impact is worse than 9/11 with parked aircrafts. Its parent IAG is already in talks with the trade unions with possibilities of Redundancies, Job Cuts, Losses validated through temporary suspension of flights, airspace shut down and/ or travel ban and related advisory in different countries and regions.

As a strategic plan, some airlines have already opted out to file for Bankruptcy and some collapsed such as Flybe in Europe. Africa’s largest airline, Ethiopian Airlines, is already talking of placing a huge number on unpaid leave.

Locally and in Nigeria, the major carrier and regional West African player, Air Peace, has been forced to shut down its operations for 23 days effective in the first

instance from 27th May 2020.

The Company, well known for its excellent staff welfare scheme, is yet to announce measures it intends to implement in order to weather this COVID-19 storm. The impact of Covid-19 on this thriving airline could only be imagined for now given its large workforce and huge fleet of aircraft. It is only safe to estimate that without government intervention or aid, as was already being advocated by critical stakeholders, this well managed airline may start to struggle.

Adewale projects that the privatized or concessioned Airports will suffer greatly with imminent job losses.

Southampton and Edinburgh Airports have commenced job cuts and at the brink of collapse without government help. Many Airports in Africa including Nigeria are government-owned or and will experience limited impact of Covid-19 crises through direct government subventions, interventions or subvention. Jobs within these airports’ management are more secured.

In a bid to however cushion effect of COVID-19 pandemic, the chief executive officer of Mainstream Cargo Limited suggested that the starting point would be to begin to plan for the next pandemic because this has become a recurrent feature that affects aviation subsector than other sector within the polity, adding that the outbreak of Ebola, MERS, SARS and now COVID-19 should be enough lessons to know this, with reference to Bill Gates inspired next global threats and suggested next course of actions.

“Governments (and their civil aviation authorities), need to embed in their National Security Plan well-ar-

ticulated strategies to contain, mitigate and/ or limit the impact of the next pandemic (or even epidemic, since all pandemics are firstly epidemic).

“Deliberate clear steps and specific course of action/ triggers per indication should be clearly developed and spelt out with widespread inputs or contributions from the Intelligence, Defence, Environment, Finance, Logistics, Health and many more sectors in an integrated process leading to a national broad strategy against the next pandemic/epidemic.

“Airlines, airports, fuellers and many other aviation services providers need to review their risk management documents and Standard Operating Procedures (SOP) to include proactive, preventive, containment and mitigation actions against the next BioThreat.

“These strategy documents must also be robust and broad-based to include actions from all departments and business units.

This is particularly important for organisations that have business operations in different regions or states.

A well thought-out strategy document would impact positively on the future survival of such entities in the next pandemic, hoping they survive COVID-19 crises,” he suggested.

Adewale also suggests that government stimulus led packages and incentives must be given to limit the negative impact of this pandemic on the aviation subsector.

These he said include deliberate sourcing, loans, grants, tax waivers, special forex windows and rates, airport infrastructure deliberate upgrades or construction, and reduction of airport taxes or surcharges.

He stated that locally and

in Nigeria, government can consider the followings: “Expand definition of aircraft spare parts to include other important aircraft items such as brake ASSY, safety appliances, rafts, aircraft tires in order to enjoy 0 percent duty waivers.

“In consultation with relevant bodies, companies and associations, increase the seven - day grace to clear cargoes to 14 days and reduce the Airport Authority concession fee from five percent to 2.5 percent with at least three months concession payment - free period. This frees cash for aviation service providers that are tenants to these airport authorities.”

Adewale also suggested that developing countries should ensure they immediately set up teams to collaborate with developed countries in order to know their post COVID-19 strategic plans.

“This is very critical as many nations potentially could be ostracised in the nearest future. Business and trade for non-strategic developing countries would be hampered because new inter border (access) regulations may be stiff or strict thus imposing tough requirements such as mandatory 14-day quarantine period before final entry and which may be enforced for a period of 12 months – 18 months.

“Nigeria must actively seek exclusion from grievous or stressful requirements for her citizens. Working now with these developed countries is very important to avoid the country being limited in trade and business capabilities. It is expected that these countries will come up with new regulations, protocols, standards and requirements into their homeland,” he explained.

“Personal Protective Equipment (PPE) was distributed to all staff to prevent infection. All customer facing staff was given nose and mouth masks. Temperature readers, hand wash facilities and hand sanitisers were provided in all SAHCO locations for both customer and staff. Bulletins on critical information about the COVID -19 virus had been distributed to staff, noticeboards and offices.

“SAHCO as a responsible

organization fumigates her facilities frequently but in the wake of the outbreak, SAHCO has had to fumigate her facilities against the COVID -19 virus so as to play her role in curtailing the spread of the virus and by also ensuring that all staff who are involved in providing ground handling activities are properly kitted with the appropriate PPEs and are conversant about procedures to take to prevent infection,” Vanessa stated.

SAHCO fumigates cargo area at MMIA against COVID-19

S

kyway Aviation Handling Company PLC (SAHCO) said it has carried out a comprehensive fumigation of the cargo area of the Murtala Muhammed International Airport as part of its contribution to the control of the spread of the COVID-19 pandemic since the cargo terminal has been saddled with the responsibility of handling the influx of essential supplies in the fight against the spread of the CO-

VID-19 virus.

SAHCO, has also been entrusted with providing aviation ground handling services for some evacuation flights of nationals of other countries, this is due to the restriction of foreign and domestic airline movement by the Nigerian Civil Aviation Authority as a means to curtail the spread of the virus.

Additionally, Skyway Aviation Handling Company PLC has been responsible for the ground handling activities of www.businessday.ng

humanitarian cargo flights conveying essential supplies for fighting the propagation of the COVID-19 virus.

In a statement signed by Uansohia Adetola Vanessa, manager, Corporate Communications, SAHCO, the company stated that in the wake of the COVID-19 pandemic, SAHCO responded to the global concern in line with the measures approved by the World Health Organisation (WHO) and the Nigerian Centre for Disease Control

and Prevention (NCDC).

“Massive campaigns were organized for all categories of staff in all locations across Nigeria informing staff of the measures to take to prevent infection in the course of their duty and at home. Emphasis was made on hand hygiene and the procedures demonstrated.

The Aircraft cleaning staff, the passenger agents, the baggage/cargo handlers were given detailed briefs and attention.

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Thursday 16 April 2020

Retail &

BUSINESS DAY

consumer business Luxury

Malls

Companies

Deals

23

Spending Trends

CONSUMER SPENDING

Coronavirus wreaks havoc on consumer goods firms BALA AUGIE

T

he emergence of the coronavirus — a deadly respiratory infection that originated in the central Chinese city of Wuhan — has had far-reaching ramifications on the consumer goods firms.

On Monday, President Muhammadu Buhari elongated the lock-down-directive in Lagos, Ogun and FCT for an additional 14 days to combat the COVID-19 pandemic.

Even before the lockdowns that shuttered business and restricted movements, a lot companies were at the cusp of unprecedented loss, as border closure, weak consumer purchasing power, and rising production costs resulted in deteriorating margins and a sharp drop in revenue.

Analysts said that the protracted lockdowns that has paralyzed business activities would inevitably affect demand as the manufactures sector could record negative growth.

They added that a lot

firms could be forced either layoff staff or cut salaries so as to stay afloat since operating cash flow would have been battered as people have whittle down consumption.

Since cash flow from operating activities is derived from turnover or revenue, a sharp drop in sales has a severe consequence on companies because they may be unable to service their debt.

“If their revenue is below

breakeven point, then they will begin to make a loss,” said Johnson Chukwu, managing director and CEO of Cowry Asset Management Limited.

Ayodeji Ebo, managing director and CEO of Afrinvest Securities Limited said the impact of coronavirus induced economic paralysis may not be felt now that it could start to show face in in the second quarter, adding

that the downside risks are worsening macro conditions and an extended lock down beyond the second quarter.

“A lot people had bought from these companies in the first quarter, and only telecoms and pharmaceuticals industry will let off the hook,” said Ebo. Because consumer goods firms had passed on high production in form of a hike in the price of product three

years ago, it would be practically difficult to use pricing strategy to salvage them from an inevitable poor operating performance.

Analysts had placed sell ratings on stocks on firms on the back of disappointing full year results, and future looks bleak for an industry that was the postal child of the economy over a decade ago.

The cumulative profit of 10 largest consumer goods firms that have released full year (2019) results fell by 24.74 percent to N63.12 billion in December 2019 from N83.87 billion as at December 2018.

Combined average industry net profit margins fell to (2.98) percent in the period under review from 6.35 percent as at December 2018.

The negative margin was spurred by International Breweries and Unilever Nigeria, two firms that fell off the cliff as they recorded huge, and more firms could slip into the negative region in subsequent quarters.

The Nigerian economy could capitulate to the coronavirus pandemics and slip into its second recession in 5

years if urgent actions are not taken to cushion the effect of the economic blow.

Last week, Zainab Ahmed, the Finance Minister, estimated that the economy could shrink as much as 3.40 percent this year without massive stimulus plan.

The warning came as the IMF began considering Nigeria’s emergency request for $3.4bn in funding, and the World Bank, from which the country has sought up to $2.5bn, released $82m to strengthen the country’s healthcare infrastructure.

The central bank has a stimulus package of N1 trillion, but this is just 0.70 percent of gross domestic product.

Last week, Global consultancy McKinsey estimated that a best-case scenario “contained outbreak” would produce a 2.5 per cent contraction. An “uncontained” one could see Nigeria’s economy shrinking 8.8 per cent.

Government has slashed its projection of 2.1m barrels a day of oil production to 1.7m, and policy makers are mulling cutting the record $35 billion budget for 2020 by 15 percent.

CONSUMER SPENDING

COVID-19: Lockdown extension to worsen consumer’s agony BUNMI BAILEY

T

he covid-19 pandemic has significantly depressed the financial position of most Nigerian consumers, who before the outbreak were grappling with weak purchasing power and higher consumer prices, and the lockdown extension will further aggravate their agony.

On Monday, President Muhammadu Buhari elongated the lock-down-directive in Lagos, Ogun and FCT for an additional 14 days to combat the COVID-19 pandemic.

Before the extension of the lockdown, the initial 14 days which started on March 30, 2020 denied households and informal business owners who survive on daily income, the means of livelihood.

And despite the relief programme from the local

authorities to feed some of the poorest people, it is not enough to meet the need of the people.

Palliative measures introduced by the government at federal and state levels to soothe the pains of the populace, especially the vulnerable ones, is still inadequate, according to Damilola Adewale, a Lagos-based economist.

“Expanding the social register from 2.6 million households to 3.6 million is very

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small. It doesn’t cover 5 percent of some 87 million households below the poverty line” Adewale argued that shrinking economic activities might propel corporates to retrench workers, slash salaries or not pay at all, further weakening consumers’ real income. “And with rising prices, it makes it increasingly difficult for them to cope.”

The Nigerian economy grew an average 2.27 percent in 2019, the fastest growth

since the 2016 economic downturn. However, economic growth remains fragile and non-inclusive as it underperforms population growth estimated at 2.7 percent by the World Bank and 3.2 percent by the National Population Commission.

GDP per capita, a perfect proxy for living standard, has been on the downward trend since 2016, indicating that Nigerians are getting poorer.

The International Monetary Fund (IMF) said last week that more than 165 countries will record negative growth in real income per capita by end-2020.

L a s t m o n t h, Z a i n a b Ahmed, the Minister of Finance, Budget and National Planning, had warned that the Nigerian economy may slide into recession if the coronavirus pandemic continues for the next six months.

“The revenue of essential

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companies that are allowed to still run e.g food companies, may be slower now because consumers will be spending out of their savings to survive, making them to rationalize on how much they spend,” Abiola Gbemisola, consumer analyst at Lagos-based Chapel Hill Denham said.

The lockdown is also disrupting supply chain, forcing prices of key staples to soar in the country.

For example, a 50kg bag of foreign parboiled rice which was sold for N22,000 before the lockdown now sells for N27,000, indicating a 23percentage increase.

A 60kg bag of red garri now sells for N26,000 as against N9,000 sold before the lockdown, indicating a 188percentage increase. While a paint bucket of red garri now sells for N1,300 as against N700 sold nine days ago.

A 5litres of vegetable oil @Businessdayng

which sold for N2,000 before the lockdown now sells for N2,500, indicating a 25percentage increase in price.

For spaghetti, a pack now sells for N4,200 as against N4,000 sold 11 days ago, indicating a 5percentage increase in price.

In Wuse Market in Abuja, a N50kg bag of local parboiled rice now sells for N20,000 as against N18,500 sold before the lockdown, indicating an 8 percent increase. Similarly, a 60kg bag of garri which was sold for N22,000 before the implementation of the lockdown now sells for N32, 000, indicating a 45percentage increase.

Nigeria’s economic outlook in the near to medium term is bleak as weak consumer demand combined with low private investment and contracting net exports is expected to weigh on domestic productivity.

24

Thursday 16 April 2020

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.’

Improved asset quality adds impetus to FirstBank Holdings profit BALA AUGIE

S

ubstantial resolution of the nonperforming loans positions FirstBank Holdings Plc for unprecedented accelerated growth in profitability as the lender has sufficient capital to surmount the uncertainties caused by the coronavirus pandemic.

A steady reduction in exposure in exposure in Oil and Gas sector buoy portfolio rebalancing, while manufacturing, trade, retail/ consumer and Agric & Agroallied sectors including telecommunication remain key sectors to grow loan.

FirstBank Holdings aggressive pursuit of recoveries on loans written-off and an excellent risk management strategy have yielded off as non performing loans (NPLs) fell to 9.70 percent as at December 2019, which compares with 24.39 percent in 2018 and an all time high of 24.80 percent in 2016.

An improvement is asset quality has helped underpin profitability amid a tough regulatory environment, as prompt resolution of legacy NPLs resulted in efficient balance sheet.

FirstBank Holdings has a strong liquidity position as evidenced by the prepayment of a cumulative $750 million subordinated notes

Adesola Adeduntan, CEO, First Bank

within 12 months.

The lender is undoubtedly undisputed leader in digital solutions with continuous growth and demonstrated track record of monetizing same, with 30 percent market share of transactions processed by the most dominant switching company.

“Our Agent Banking strength/reach is unparalleled in the industry leading to increasing customers’ adoptions of our digital

banking offerings,” said the bank.

It has executed more transactions through the FirstMonieAgent banking platform than over Automated Teller Machines (ATMs) while it has the fastest growing network of Agents in the industry with over 53,000 agents Of the 774 local government areas, FirstMonie Agents are present in 772 (c. 99.7 percent coverage) across the 36 states of the

country The lender is sustained market leader in USSD (*894#), growing transaction volume 37.9 percent, while transaction value increased by 30.61 percent to N2.56 trillion in December 2019 as against N1.96 trillion the previous year.

Transaction volume across mobile banking channel grew year on year (y-o-y) by 31 percent, while value of transactions saw a 50.3 percent increase y-o-y to N6.70 trillion in the period under review as against N4.46 trillion the previous year.

Over 85 percent of customer-initiated transactions executed via digital channel, validating the lender’s aggressive foray into the digital banking space.

Analysts say FirstBank Holdings’ ability to use mobile banking to strengthen bottom line (profit) shows it is poise to thrive even amid a low yield environment.

Yields on shorter government had been falling precipitously since the start of 2018 and gathered more momentum in 2019 following key decisions by regulators.

The consequences of a low yield environment are that lenders can no longer pack their money in government bonds and cash, a situation that has impacted negatively on interest income.

Deposit Money Banks (DMBs) are operating in a tough and unpredictable macroeconomic environment. Their woes started in 2016 when the sharp drop in crude oil of price of mid 2014 that tipped the country into its first recession in 25 years resulted in exposure to the oil and gas.

During the economic downturn, a lot of valued customers were unable to pay interest on money borrowed, culminating in huge write offs, as there were no government bailouts as it was in Euro and the United States at the zenith of the 2008/2009 financial crises.

While the introduction of a flexible exchange rate regime by the central bank in 2017 added impetus to flow of foreign exchange in the

system, lenders have been struggling with a torrent of stringent regulations.

First, the Apex bank hiked the minimum loans to deposit ratio of Deposit Money Banks (DMB s) to 65 percent, with hefty fines for those to meet the requirement.

Second, the regulator pushed local private and institutional investors out of the Open Markets Operations (OMO).

Third, it hiked the cash reserve ratio to 22.70 from 22.50 percent as it seeks to raise more zero-cost funding from the banks.

Amid these challenges and stumbling blocks, FirstBank Holdings’ net income has been recording double digit growth in the last 5 years.

Net income spiked by 26.49 percent to N73.66 billion in the period under review as against N58.23 billion the previous year; the lowest profit figure was N15.14 billion in 2015.

Excluding total foreign exchange income, non-interest income contributed 34.0 percent to net revenue from 25.8 percent in prior year FirstBank Holdings’ gross earnings was up 6.7 per-

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

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@Businessdayng

cent to year on year (YOY) to N622.12 billion, thanks to growth in non-interest income, as the lender successfully move towards a transaction banking-led model and increase our digital banking capabilities.

The lender has utilized shareholders resources to generate higher profit as its return on average equity (ROAE) jumped to 12.38 percent as at December 2019, from 9.65 percent the previous year.

Retail franchise remains the key driver of FirstBank Holdings deposit growth, with savings deposits in excess of N1.3 trillion. Depositors to customers were up 14.89 percent to N4.86 trillion in the period under review as against N4.23 trillion the previous year.

FirstBank’s strong earnings generation capacity provides a solid platform for capital accretion even amid coronavirus pandemics that is increasing ravaging global economies.

Capital Adequacy Ratios of 15.30 percent remain above regulatory thresholds as long position of the balance sheet provides a secured position for capital accretion in the event of a potential devaluation.

Thursday 16 April 2020

BUSINESS DAY

INTERVIEW

25

‘COVID-19 has proved that colocation, cloud computing offer competitive costs, reduced operational intensity’ Gbenga Adegbiji has just been appointed chief operating officer, MDXi, a subsidiary of frontline data and connectivity service provider, MainOne. In this interview with FRANK ELEANYA, Adegbiji speaks on the role data centres play in the economy while specifically drawing attention to their relevance as the world grapples with COVID-19.

Y

ou have just been appointed chief operating officer of MDXi. What does this mean to you and MDXi customers?

It’s been an honour to be entrusted with such a huge responsibility, leading the growth and future success of West Africa’s leading Data Center. The good thing is that we have been on the path of operational excellence since we launched our Lekki Data Centre in January 2015.

Our customers can be assured that, with our focus on strategic investments and partnerships with top global technology players, they can expect improved services tailored to their business requirements, allowing them to focus on their core business for the growth of revenues.

COVID-19 was unexpected and unprecedented, how are you able to adequately support your customers during this lockdown period and how has this affected Data Center (DC) operations generally?

Though nobody envisaged the pandemic, I must say that having Business Continuity plans that could be invoked at any time are standard for our Data Center.

We only needed to adapt those procedures to the peculiarities of COVID-19 in terms of health hazards, access requests, health & sanitation screening amongst others.

We deemed it important to quickly align with global best practice in containing the pandemic, while also enabling the safety of our operational staff, our customers and ensuring business continuity irrespective of the lockdown.

As you may know, data centers are required to run with the same availability or even higher than before the lockdown and that is what we have done. Our COVID-19 plan has had to restrict access to our facilities to encourage social distancing, excluding emergencies. In such cases, our procedures require the customers to fill out an emergency access form, that highlights critical information about the visitor including recent travel history.

Because access to the Data Center is now partly restricted, we have offered the services of

will see the need to leverage shared data center infrastructure to give their businesses the needed edge, in terms of agility, flexibility and overall competitiveness. Our expectations are that, requirements for data center services will continue to go up and MDXi is currently expanding its data center footprint across West Africa in order to address such growth.

our engineers for ‘Remote Hands and Eyes Support’ (RHES) free to our colocation customers.

What this means is that, our engineers will carry out physical technical interventions for our customers without their having to dispatch someone to the DC, thus saving them the time and effort. This allows us to keep our embedded operations staff safe and healthy, thus ensuring the Data Center continues to run with effective staffing support

‘

According to McKinsey, by increasing the participation of women in economic activities, African countries could add $316 billion to their collective GDP by 2025 www.businessday.ng

on a 24/7 basis.

MDXi has been in service for over five years, providing colocation and cloud services across West Africa, how do you see Data Center business post COVID-19?

COVID-19 has only increased the visibility of our digital economy, and the extent to which our society and businesses are connected. Post COVID-19, we expect collaboration across cities, states, countries and continents to drive productivity and innovation will only continue to grow.

It is expected that the demand for Data Center Colocation and Cloud services will continue to grow in that context, as more customers realize the benefits of outsourcing their IT operations. Businesses that survive post COVID-19 will have to leverage technology to provide some level of resilience to address what will become the new normal in enhancing social distancing, enhancing safety and convenience by doing business online.

This future will be hinged on the interconnection of everything, and as businesses increase their reliance on technology, data centers will be at the center of that. Businesses

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MDXi recently unveiled its Azure Cloud services at Nerds Unite 2020, in partnership with Microsoft and HPE, how does this partnership affect services for your existing Cloud customers?

As the first Data Center in Nigeria to offer Microsoft Azure Stack Cloud services to customers, we have enabled companies gain access the same world-class Azure technology available internationally on Public Cloud platforms, closer to home.

This reduces latency for these locally deployed applications to under 10ms, resulting in a better experience for end users and ensuring that limitations previously experienced on deploying latency sensitive applications in the Cloud are eliminated.

Our Azure platform also allows customers meet local data residency requirements which companies in certain sectors require for compliance reasons, since the hardware is hosted locally at MDXi. Apart from hosting on our Azure Stack platform, we also help our customers implement Multi-Cloud solutions including Public Cloud options, leveraging our Gold partnership with AWS and Microsoft.

What is the next big thing for MDXi and where?

We remain focused on sustaining our operational excellence while continuing to expand our footprint across West Africa, starting in Ghana with our new 100-rack, Tier III facility in Appolonia City.

The city is a fast-growing light industrial park, located within the northern suburbs of Greater Accra metropolitan Area and our facility will span two acres of land when fully built. The facility is designed to world-class standards consistent with the MDXi brand, assuring collocated customers of the highest quality of service to meet their business @Businessdayng

requirements.

We are currently at the ground-breaking stage, with the construction of the facility to begin immediately after the COVID lockdown restrictions. We also commissioned our Abidjan Data Center, in Cote d’Ivoire, last year which is collocated with the Cable Landing Station (CLS) of MainOne. Finally, in Nigeria we are expanding the Lekki-Lagos facility where we are fast exhausting our footprint and starting the expansion of our footprint to Sagamu, Ogun State.

With disruptions that can truncate normal business operations such as the COVID-19 pandemic, what message do you have for businesses that are still running on-premise IT operations?

IT managers are often concerned with the availability and security of their computing infrastructure and that is why sometimes they are wary of moving off-premise. With businesses looking for ways to stay ahead of the competition in our challenging environment, outsourced colocation services are the best option to deliver high availability, manage cost, ensure flexibility, and provide optimal security.

The COVID lockdown has challenged organisations running their critical facilities onpremise; from arranging fuel supply and logistics, managing facility spares, staffing those facilities round the clock and ensuring everything keeps running to support their businesses during the lockdown.

In contrast, our customers do not have to worry because they have outsourced those operations to us, to run their infrastructure adequately and efficiently. Not only do colocation and cloud services offer reduced operational intensity for businesses at lower CAPEX and OPEX costs, they also guarantee 24/7 uptime, with easily expandable capacity.

Those businesses that have taken the necessary steps in colocation and cloud deployment are currently enjoying the benefits in this COVID-19 era, while those yet to do so will have to make the right decisions when the pandemic is over or remain at a disadvantage to the competition.

26

Thursday 16 April 2020

BUSINESS DAY

Garden City Business Digest Entrepreneurship:

There is big hope for the Niger Delta going by the fire in eyes of the young ones – JAN regional boss Emmanuel Oturu says the secondary schools model CEOs trained by Junior Achievers Nigeria are deeply creative and enterprising Ignatius Chukwu

J

unior Achievers Nigeria (JAN) focuses on grooming the youths in Nigeria to become future business executive with a difference. In the 11 states of the Niger Delta, JAN is doing even more, but they said they have hit a gold medium, being the discovery of where the hope of the Niger Delta lies.

In an exclusive interview, the Niger Delta Programme Coordinator, Emanuel Oturu, revealed to BusinessDay that the depth of creativity and fierce sense of enterprise discovered in the young ones in secondary schools show that there is big hope for the region.

Over the years and through several grooming programmes and projects, the regional coordinator said the myth that the people of the region were not enterprising has been shattered. He said many of the young ones that JAN produced have gone on to be world beaters in business management and entrepreneurship.

He said the biggest thing he would point to is making the young ones discover that there is far more to it in the Niger Delta than oil. Speaking on some encouraging discoveries in the past 20 years in the oil region, he said; “Last year, JAN in partnership with ExxonMobil, developed a programme called ‘Our Niger Delta Region’.

Out of our experience over the years, we wanted to teach young people non-oil resourc-

the Executive Director of JAN, Simisola Nwogugu, who he said created a transformation vision of going digital. This has helped the programmes to run during the conoravirus shutdown. “This is sustaining the programmes especially the Company Programme for secondary school students.”

He went on: “Now, young people now sell shares, come up with product design, etc.

A lot of them are moving from physical to online sales of their products, from physical engagement to digital engageEmmanuel Oturu, Niger Delta regional coordinator ments.”

Simisola Nwogugu, executive director, JAN He stated that JAN has a scheme for young girls that es in the region. We realize that cover that they had a culture find that many businesses are are vulnerable and train them. a lot of times, the young people of contending with difficult failing because they were not “We plan to expand some of are too oil-focused. So, we de- natural obstacles posed by the equipped earlier. With JAN, these programmes in more cided to teach them that there ocean, rivers and creeks. They we are able to engage them cities in the Niger Delta.” is more outside oil and gas. We were waking early to do fishing early. They will understand “JAN is the nation’s largest make them see and appreciate and do farming and also work some of the risks and learn non-governmental organizathese other assets such as hu- out how to make money out of how to mitigate those risks tion dedicated to preparing man capital resource, sand, their enterprise. What we now and run more successful busi- young Nigerians to succeed in forestry, plants, herbs, wildlife, do is to inspire them to go back nesses.” a global economy. As a global etc that are hugely untapped.” to entrepreneurship.

Oturu said there is an alum- organization, Junior Achievers He went on: “We also teach “Beyond going back to ni networking opportunity in delivers unique experiential creativity. Now, we realize that it, we are helping to shape a JAN, both at global level and programmes focusing on the there is hope for the Niger mindset that will make them national level. At the JA world- four core areas of entrepreDelta by looking at the numer- run sustainable ventures. We wide level, there is the ‘JA neurship, financial literacy ous inventions of our students, find that because the people Gather’ where all former par- and work readiness which the excellence of their think- here start entrepreneurship in ticipants of the programmes ignite spark in young people ing, and manner of executing adult age, they can’t afford to in all nations can sign up and to experience the world of their projects at this level. The take much risk. That’s where share their experiences and business and realize the opfuture is actually bright for the JAN comes in to train them at learn a lot more. At JA Nige- portunities and realities of Niger Delta. A lot of people secondary school stage, allow ria, there is a strong alumni the 21st century. In Nigeria, do not know that the Niger them make their mistakes, engagement platform and JA is committed to building Deltans are actually naturally learn the lessons, and rebuild. ‘Alumni Leaders’ in the various financial and entrepreneurial entrepreneurial. There is this By the time they are out of states and at the national level mindset in young people aged myth that they are not. Our the university, they can now with a coordinator keeping five to 27 across the six geopomeeting with the younger use their experience in JAN track of them. litical zones.” ones has proved that they are schemes to construct and run On the position of thing, Oturu further stated that deeply entrepreneurial. If you better sustainable ventures. the regional coordinator ex- JAN is actually a non-governgo back many years you dis- When you look around, you pressed huge appreciation to mental organization. “We are

part of the JA world family with the mission of educating young people to become conscientious business leaders.

We achieve this by implementing economic programmes that develop attitude needed for personal success and social responsibility of the individuals.

“Our core goals in JAN is to build a bridge between the classroom and the workplace so as to increase employability of young Nigerians, and to be recognsised as leader in production of high quality of entrepreneurs and boost financial literacy in Nigeria.

We seek to develop the ability of young Nigerians so they can compete effectively in the global market place. We foster socially responsible attitude and spirit of patriotism among successful business leaders and companies operating in Nigeria. This is to alleviate poverty in Nigeria by empowering the socially and economically disadvantaged.

“Our vision is actually to give birth to young conscientious leaders leading a vibrant economy. The goal is to raise young people that would not just be entrepreneurs but would be entrepreneurial in their thinking to lead a vibrant economy.”

He said the programmes are robust and have attracted some of the best CEOs in Nigeria and best corporate organizations some of who are on the board. He mentioned the likes of Aliko Dangote, First Bank, Slumberger, etc.

Why PH is bleeding, and way out?

Port Harcourt

by Boat

IGNATIUS CHUKWU

O

n March 4, 2018, a group of business experts gathered at a particular hotel in Port Harcourt and examine the advantages the Rivers State capital has over Lagos and other competing cities. They end up listing lamentable issues that Port Harcourt has. They ended up calling up Dakuku Peterside, then DG of NIMASA, to proffer solutions.

They poured lamentation and feared that

Port Harcourt may go the way of Warri in Delta State which began as an oil city and ended as a distressed city. Now, they say, Port Harcourt seems to toe the Warri way.

Excerpts.

Concerned indigenous experts such as Igo Weli of Shell continue to appeal to the youth of the region to sheath their agitation swords and apply dialogue to avoid total collapse of the economy of Port Harcourt.

Now, at a business dinner last Sunday called Rivers Evening of Truth at Juanita Hotel in the Old GRA, Business Rivers Group, an emerging think-tank in business and investment made up of top business operators in the Garden City, dedicated the moment for brainstorming to save the declining city. Many of the experts and investors led by an estate expert, Utchay Okorji, expressed their love and preference for Port Harcourt over Lagos, saying everybody must not move to Eko. Giving reasons why life should be better in Port Harcourt, Okorji said: “Rivers State is my choice city. I do not like Lagos, I love Port Harcourt. Both cities have some characteris-

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tics especially in presence of multinationals.

He however said Port Harcourt was bleeding by the number of family heads and bread winners that relocate to Lagos every day.

Should a middle class family especially oil industry worker relocate from PH to Lagos, he would transfer a yearly spending budget of at least N6m to Lagos such as N1.8m for rent, N3.3m for food and the rest on medicals, clothing, repair of vehicles, etc.

Solution: The way forward – Dakuku Peterside; exDG of NIMASA The private sector or business people did marvelous things to turn around the economies of the Philippines, China, South Korea, etc. It is for the intelligentsia. A method must be worked out how to engage with skilled people. Society changes by change of policy, Engage with the state government, prod the government to think in certain ways and to set guiding posts for the business people to follow. Government sets policies that would set targets on per capita, GDP, etc. Open the economy for inflow.

Leaders must be vision leaders. The

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leader must table a vision and where that vision should lead the people to and how to get there. This apportions tasks to different sectors in both the public and private sectors with the chief executive of the state as team lead.

The Rivers Disconnect: There must be the right leaders to do this. The people in this hall can change the economic trajectory of Rivers State. Begin with engagement. You have the power to change the way the government works. There seems to be non-deployment of the intellect available in the state. You as businesses can work together to make the state work. You can get the government to change the way it is working; you can change the government. Today is the best time.

Conclusion: In a vote of thanks, a prominent member, Enyinna Onyegbule, said solution must be found to the exodus of businesses and capital from Port Harcourt and Rivers State.

“We started this four years ago, and we are determined to engage. Posterity will judge us harshly if we don’t take action today. We will keep engaging the business group.”

@Businessdayng

Thursday 16 April 2020

BUSINESS DAY

27

Investing in Rivers State Two experts show how Nigeria may play big in Africa Create one window for AfCFTA – Sam Epiah Make Nigeria export-ready – Joe Ita Ignatius Chukwu

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bout three weeks to end of 2019, the Nigerian Export promotion Council (NEPC) led by Olusegun Owolowo, the executive Director, mounted a workshop in Port Harcourt for the south-south zone to promote export mindedness and practice.

Two particular experts granted special interviews to BusinessDay and unveiled strategies that can move Nigeria forward in the African continent, trade wise. At the event, Awolowo, who spoke through NEPC zonal coordinator, Joe Ita, said there some advantages the zone had and these advantages raised the enthusiasm of the council to organize the engagement. He said; “More so, it is an established fact that intra-Africa trade is extremely low compared to other regions. It is paltry 15%.

Intra-America is 46%, Intra-Asia is 60% while Intra-Europe stands at 70%. Some compelling reasons for us all to prepare to cash-in on opportunities that AfCFTA is bringing.

“Today, we are honored to have Sam Epiah and Olufemi Boyede with us – as lead speakers. All two are esteemed specialists and trade experts of repute. Prepare yourselves to be challenged, excited and inspired on the subject of economic development through non-oil exports.”

Interviews: What Sam Epiah, MD/CEO, Cloverleaf Shipping Ltd, said; There should be a window to

NEPC seminar: L-R: Sam Epiah, Joe Ita, and Olufemi Boyede

manage all AfCTA transactions, the way EoDB does, not task force We have various agencies already, and we know how people view task force in Nigeria. The ports authority (NPA) has its own role to play by ensuring that facilities are in place. The issue of drought is for BPA. Cargo handling is for terminal operators, while roads are for FG and state governments. The issue of inter-modal transport system is for the Federal Ministry of Transportation that should ensure that things move well as train is moving now in Abuja to Kaduna. If we have such a system between PH and the north would be good.

Task Force in my opinion is not the solution. There should rather be a harmonization of roles and activities of the agencies. If we have what they call the single window where

issues that concern each agency are put in and all other agencies see it.

Like for Ease of Doing Business, any issue gets to all the agencies responsible. The EoDB desk in Abuja sees it and they get across the agency and ask them why.

For me, there should be a time deadline for responding. It should not be about asking why and go to sleep. There must be time to respond because in shipping, time is money.

If you have coming out of the port and if for any reason, an agency holds, you are paying demurrage on it. So, there must be time for SON to respond with reason for stopping the vessel. The importer will now know how to react. If it is a document or a fee holding it, the importer moves to provide it. Task Force is not what is needed.

Factors that may hinder AfCTFA

Yes, I clearly stated some of the things that can hinder Nigeria. In infrastructure, we are not ready.

We do not have inter-modal system in place. We are still loading cargo manually. You cannot measure up with someone using mechanical operations. Roads are not ready and other things that need to be in place are not.

Give eastern ports up to 30% discount for justifiable reasons Something is going on but not as much as we wanted. These ports can still get to their optimum utilization, by having tug boats, pilot cutter, sailing time, and deal with security issues.

Concession is an issue because every port has its own geographical peculiarity. We cannot compare eastern ports with Lagos ports. Ships take 40 minutes to get to Lagos ports, but in the east, its between six and eight hours from the high seas. This makes it more expensive because of more fuel and insecurity.

What some of us are asking for is that the rates for eastern ports should not be the same with Lagos rates. There should be up to 30 per cent discount across board for goods coming. This was done in the past and it worked. This is what we are saying. This is to boost patronage.

Joe Ita: Regional Coordinator, NEPCo, south-south region Nigeria must be export-ready The people here are not only those that have problems but also solvers. We have stakeholders from the government side, NIMASA, NAFDAC, RMDC, etc. What we are missing here are about two organisations. Those here are exporters, manufacturers and those we call new exporters and existing exporters

such as Notore, etc.

Our idea of putting this together is due to our concern for the level of non-oil exports in the eastern zone.

In the speech of the ED, I said its not as if nothing is going on at all. I gave an example of the two ports here and customs. Reasonable volume of non-oil export is going on. We have Warri, Calabar, PH, but not much is happening because of the litany of problems as stated by the experts. We cannot give up. Nobody waits for you in the international market.

The AFCFTA has been ratified by 27 whereas only 22 can make it take off. Trading across borders or borderless trading has come, whether Nigeria likes it or not. So, its time to face the challenges pointed out such as infrastructure. This seminar is to create further awareness so that the misconceptions that shrouded the trade agreement would be demystified. When people know they have to raise their standards and quantity of what they produce.

What exporters can do to prepare for the AfCFTA regime Knowledge is key. Processing papers is important. Financing is important because exporters should know the financiers. Banks are still giving loans but you have to have bankable proposal. I have mentioned financing, capacity building, and even mental orientation.

Nobody waits for anybody in international business. It is important to be export-ready in terms of market penetration, product, personnel, prompt information, etc. We try as much as we can to always put exporters on their toes, but we know there are difficulties and government is aware of the inhibiting factors.

Gov Wike insists on safety for Rivers people • Says weapons in hands of one criminal gang can dislodge Port Harcourt Ignatius Chukwu

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ov Nyesom Wike of Rivers State has promised to continue to focus on protecting Rivers people but said weapons in the gang of one criminal gang alone can sink the state capital.

Details The weapons found in the custody of one criminal gang in Rivers State alone can bring down the entire state capital, so says the governor of the state, Nyesom Wike, who just received a cache from a dislodged gang.

This is as the governor has vowed to focus on keeping Rivers people safe in line with his constitutional responsibility of protecting everyone living in the state.

The weapons presented to him by the police command recovered from the forests of Ogu/Bolu one GPMG No NN-07-150; two G-3 rifles with

breech No’s 81- 85234 and 69090978; one SMG rifle No. 19855; One rocket launcher(RPG) rocket propelled grenade NW-07-150; five Pump Action guns; 933 rounds of 7.62mm live

ammunition; 1,111 rounds of 5.56mm live ammunition; 222 rounds of 9mm live ammunition; 909 rounds of 7.62mm live ammunition; 74 rounds of .9mm live ammunition; 728 live

Gov Wike (l) and Service Commanders inspecting sophisticated weapons recovered by the Operation Sting during a programme at the Government House Port Harcourt on Monday www.businessday.ng

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cartridges; four AK 47 magazines; two G-3 magazines; one SMG magazine; and total number of ammunition/ cartridges being 3, 249.

Speaking at the Government House during the presentation of the recent achievements of ‘Operation Sting’ by the State Commissioner of Police, Mustapha Dandaura, on Monday, Gov Wike commended security agencies in the State for working with the State Government to check the activities of criminals.

He said: “I have made a vow that Rivers State must be safe. It is a duty that we are committed to carry out.

We have no excuses to give.” Gov Wike said that as the State Government fights to protect Rivers people from coronavirus, it will not relent in ensuring the security of lives and property.

He urged the media to also focus on the successes of the State Security Council in the area of securing lives in the state. He said that bursting the @Businessdayng

kidnap syndicate is a major achievement by Operation Sting.

Governor Wike said that the recovered weapons alone can dislodge Port Harcourt City. He wondered what the criminals were doing with sub machine gun and rocket grenade launchers.

He said that operatives of Operation Sting were on the heels of a notorious Isiokpo Kidnapper, who will soon be apprehended and prosecuted.

Earlier, the Commissioner of Police, Mustapha Dandaura, commended the Rivers State Governor for his logistical support that has energised the security outfit to achieve notable success.

He said that the Operation Sting initiated by Governor Wike has sanitised the hitherto troublesome East West Road, the Elele-Owerri Road and the Ogoni axis of the East West Road, making the state safer for residents and visitors.

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Thursday 16 April 2020

BUSINESS DAY

ENERGYREPORT Oil & Gas

Power

Renewables

Environment

How US intervention helped seal crucial OPEC+ deal olusola Bello

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s demand for fuel plummeted worldwide and the oil industry faced a devastating drop in oil prices, the U.S. took the rare move of stepping into negotiations involving the member countries of OPEC and non-members such as Russia and Mexico, an alliance called OPEC+.

The current oil glut is estimated at around 20 million barrels per day( BPD). Even though the OPEC+ cut of 10 million BPD is historic, it only represents about half of the global surplus. G-20 energy ministers are expected to deliver another five million BPD says Victor Eromosele, chairman and chief executive officer of ME Consulting.

“Even with that, it does not completely eliminate the oil market surplus - created by the one-month old SaudiRussian oil price war - as many storage facilities are full to the brim with relatively cheap crude oil,” he said He said for country like Nigeria to fare better under this condition would depend on what card she chooses to play.

But, that there are not many jokers until the coronavirus pandemic recedes.

Oil prices he said will likely firm up in the thirties, but that would still be some $25/ bbl below Nigeria’s budget assumption. “With the exception of China, many of Nigeria’s traditional buyers - India, France, Italy and Spain - are

still under lockdown. Parked cars and parked planes do not consume hydrocarbons or help oil demand. Until the pervasive global lockdowns considerably reduce - post-pandemic - Nigeria may frankly remain between a rock and hard place.”

According to Associated Press (AFP) President Donald Trump and a group of U.S. senators wielded political influence to push OPEC and its allies to agree over the weekend to cut production by nearly 10 million barrels per day — about 10percent of current global output.

The unusual action by the U.S. and the fact that the intervention worked reflect the desperate conditions the oil industry found itself in due to the economic damage wrought by the coronavirus outbreak.

“There have been oil market crises, but nothing like this before,” said Dan Yer-

gin, vice chairman of IHS Markit. “Even when the price collapsed in 1986 or 1988, demand actually went up.

You’ve never had a 20 to 25 percent drop in demand just overnight. You’ve never had the world economy shut down overnight.”

“This historic action will help nearly 11 million American workers who are supported by the U.S. oil and gas industry,” Trump said during a coronavirus press briefing Monday.

American officials have gotten involved with OPEC in the past, making phone calls or attempting to sway a deal during international crises and unusual circumstances.

The intervention has typically been in response to high prices; instead, in the current situation, oil prices dropped more than 60% since the start of the year.

“There is nothing new about a president phoning

Riyadh to ask for help dealing with oil market disruptions, but the level of pressure and deep involvement of both sides of Pennsylvania Ave., not to mention the G20, along with the scale of the oil cuts on the table, is something rarely seen in OPEC history,” said Jason Bardoff, founding director of Columbia Unversity’s Center on Global Energy Policy.

Mexico stalled the negotiations by refusing to cut more than 100,000 barrels a day of production, when OPEC was asking for double or triple that amount. Trump said the U.S. would help by shouldering the cuts that Mexico was unwilling to make.

While Trump’s promise to help Mexico may have seemed hollow, U.S. companies were already cutting production due to the low prices. Trump’s intervention on Mexico’s behalf sent a message that could have helped push the wary alliance

into a deal.

They had to agree to give something like a cover story, a diplomatic cover, so that the other parties in OPEC, who whether they liked it or not were going to have to accept these terms, would be able to do so without a loss of prestige.

Trump’s statements also signaled that the U.S. views Mexico as an important partner in the integrated North American energy market, said Amy Myers Jaffe, senior fellow at the Council for Foreign Relations, who also saw it as an important policy move. “I think it will serve the president well on every count,” including border issues, she said.

Even more stark was a call between a dozen U.S. senators and high-ranking energy and defense officials Saturday. Sen. Dan Sullivan, R-Alaska, noted there is legislation drafted that would remove American forces, including Patriot Missile batteries, from Saudi Arabia.

“If they lose that group of senators you start to see veto override majorities on legislation that deals negatively with the Saudis,” Sullivan told a small group of congressional reporters.

That was a very clear threat, Book said. “It’s not really a negotiation at all.” he added. “It’s a pretty dangerous neighborhood for the Saudis, and the U.S. plays a vital role in protecting them.”

With state-run oil operations, OPEC nations can easily enact a cut or boost production. But the U.S. has

thousands of independent oil producers, so coordinating and enforcing a production cut would be complicated, and experts say it’s unlikely.

Some oil producers in Texas and Oklahoma are pushing for state-mandated production cuts, but the industry is split on the prospect. Right now, the producers with more costly production are most likely to suffer, and would be the first to file for bankruptcy or shut down existing wells, damaging oil fields. But a state-managed production cut “spreads out the pain uniformly,” Book said.

“We’re not suggesting that Oklahoma can balance the market, we can’t do that,” said Mike Cantrell, owner of Cantrell Investments LLC, an oil and gas investment group based in Oklahoma.

But state wide, production has declined about 20percent this year, the equivalent of about 100,000 barrels a day, a cut similar to Mexico’s. If sustained, “that would be a cut that would be a significant cut in the world scheme of things,” he said.

Despite the deal, U.S. benchmark crude was trading at about $22 a barrel Monday, well below what most producers need to financially survive.

But that was still better than what some analysts had predicted including a drop in the price to the single digits.

“A clock was ticking, for all the players, because by the end of April or early May...the world was going to run out of storage, and the price of oil was going to drop like a rock,” Yergin said.

them as private companies to improve supply of electricity they quickly recanted their position, saying that the implementation would depend on the Federal Government effectively picking up the Electricity Bill for this period.

According to a press release by Eko Electricity Distribution Company which was also circulated by Ikeja Electric titled: “Clarification of media reports on two months free electricity supply”.

It stated that following media reports that Electricity Distribution Companies (Discos) will be supplying free electricity to their customers for a period of two months, its management deems it imperative to promptly clarify these misleading media reports.

“The proposal contains many laudable initiatives in-

cluding the provision of free electricity for two months with the Federal Government effectively picking up the Electricity Bill for this period. We hereby clearly state, that Distribution Companies are fully in support of this proposal and willing to play our role in making it a practical reality. If approved, this proposal would also provide a very welcome and timely stimulus to the economy”.

They however stated that free supply will completely depends on the success of the proposed stimulus package being passed by the National Assembly and signed into law by Mr. President.

Nigerians are waiting to see how the discos would address this when the second stimulus package by the House of Representative in made public and signed by Mr President.

Why Discos recanted move on free electricity for two months? olusola Bello

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iscos played to the gallery in the face of supports by corporate bodies aimed at cushioning the effect of COVID 19. They did so probably to be counted as one of the bodies that are trying through social corporate responsibility to cushion the effects of the ravaging coronavirus.

The House of Representatives recently called for supply of free electricity to Nigerians for two months as part of measures to cushion the effects of the COVID-19 pandemic. The House said it was considering that in the second stimulus bill.

In response to the proposal, the 11 Electricity Distribution Companies, DISCOs, under the aegis of Association of Nigerian ElecOlusola Bello, Team lead,

tricity Distributors (ANED), offered to support the move to supply free electricity to all consumers within their networks for two months.

The DISCOs stated that this will be a palliative measure to bring succour to Nigerians in the face of COVID-19 induced period.

The group jumped at the proposal by the national assembly without initially thinking of the implications of such initiative on their balance sheets. These are companies that embarked on crazy bills to unduly jack up their revenues and where they are not able to give crazy bills may be the preponderance of those that lived in a particular place are on prepaid meters they are denied power supply.

It was therefore surprising to those that follow the trend of events in the sector when Sunday Oduntan who

Graphics: Joel Samson.

represents the group said the group support the idea of given two months power supply to Nigerians without payment to cushion the effect of COVID 19.

Where would they get the money they would loss through that palliative from?

The association most often complained of consumers not paying their electricity bills. So they are not able to realise the much needed revenue for both operations and investments.

Also they complained of not having enough revenue to meet their obligations to the market operator. This has led to the current financial challenges being faced by others along the power value chain. The generating companies are groaning because the discos are not remitting enough money to meet up their obligations to gas suppliers.

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Most of these electricity companies have failed to fix the necessary infrastructure in most parts of their franchise areas because they complained they do not have enough money to do them inspite the fact they send crazy bills to those that live in those areas and forced them to pay for power they were not supplied.

He said the gesture by the companies, which comes in the form of a “two-month rebate of free electricity to their customers nationwide” was in alignment with the federal government’s effort to assuage the pain on the people as a result of the Coronavirus pandemic.

Perhaps on further reflection on their statement that it would contradict the position they have held all these while that they are not solvent to make all the investments expected of

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Thursday 16 April 2020

BUSINESS DAY

29

news Stocks jump by most since early...

Continued from page 1 Maurice Iwu (r), chairman, Imo State Covid-19 Prevention and Control Committee, receiving sanitisers presented by the Academic Staff Union of Universities (ASUU) from ASUU leader and the zonal leader of Owerri zone, Uzochukwu Onyebinama, on behalf of Governor Hope Uzodimma.

Worst recession since 1987 means...

Continued from page 1

Already, Odekhian, like

many informal sector workers in Lagos, is complaining that the lockdown is depriving them of their means of sustenance as sales have slowed significantly for businesses permitted to operate during the pandemic.

The informal sector contributes some 60 percent of Nigeria’s GDP and 80 percent of employment, according to Kyari Bukar, onetime CEO of Valuecard and former chairman of the Nigerian Economic Summit Group (NESG).

“Social distancing may result in other ills we don’t want to see down the road,” Kyari said.

Warnings from the IMF that the Nigerian economy could suffer its steepest recession since 1987 signal another wave of poverty spike for Africa’s biggest economy already said to be the global poverty capital.

Before rebounding in 2021 with 5.8 percent growth, the IMF sees the global economy shrinking 3 percent this year, a trend much worse than its 0.1 percent dip in the Great Recession year of 2009.

The 2009 recession threw 90 million to the ranks of the hungry and reversed a 20year decline in world poverty, according to the United Nations study, “The Millennium Development Goals Report”.

But the lockdown and its attendant flattening of economic activities, combined with a dip in oil prices, mean emerging markets and low-income countries across Africa are especially at risk.

For Nigeria, despite a recovery in 2017, an annual recession four years ago pushed millions into extreme poverty as the country overtook India as global poverty capital, and rendered a quarter of the labour force jobless.

The IMF-projects a 3.4 percent contraction in GDP for Nigeria this year, the biggest in about 32 years, and

13.3 percent inflation rate which will push more Nigerians into poverty and worsen unemployment levels, with some small and medium scale businesses already shutting down in the country.

“If poverty incidence was 55 percent, a back of envelope estimation of increase to 80 percent is not unreasonable right now,” said Bongo Adi, an economist and lecturer at Lagos Business School, who said IMF’s forecast could even be an underestimation.

Adi said national output would shed much weight because activities would be below pre-pandemic levels even after lockdown is lifted.

The lockdown in some states, he said, has caused a disruption in the supply chain across every economic activity.

“The implication for poverty is dire and it goes without saying. Most Nigerians were living hand-to-mouth and now the people that give them jobs to do are out of businesses themselves,” said Adi. Up to 2,877 or 61 percent of medium-sized enterprises shut down within four years to 2017, according to data from NBS and SMEDAN, who say around 90 percent of businesses in Nigeria are MSMEtyped which make up half of the economy and account for 86.3 percent of jobs (59.6 million jobs in 2017).

In 2016, at the depths the recession, the Manufacturers Association of Nigeria said at least 222 small-scale businesses closed shop, leading to 180,000 job losses.

Yet, Nigeria needs 4050 million additional jobs between 2015 and 2030 to reduce poverty and boost inclusive growth, World Bank estimated then.

In a BusinessDay report on Monday, Degun Agboade, president, Nigerian Association of Small and Medium Enterprises (NASME), warned that many businesses would not be able to recover postCOVID-19. www.businessday.ng

“The impact will be longer than we expect and the government is not doing enough to support us at this time,” he said.

According to a recent report by Enhancing Financial Innovation & Access (EFInA), a financial sector development organisation that promotes financial inclusion in Nigeria, COVID-19 could affect the livelihood of 50 percent of the 99.6 million Nigerian adult population who earn their income on a daily or weekly basis.

Shutdownofbusinessesand layoffs could lead to a decline in consumer spending, especially withafast-risingpopulation,risk of imported inflation on naira devaluation and a sharp rise in consumer prices.

Bleak outlook could worsen inequality as well as regional disparity.

According to the World Bank, 87 percent of all the poor in Nigeria as of 2016 are concentrated in the Northern region compared to 12 percent in the South.

The emerging trend of a growing disparity between the Northern and Southern part of the country has seen income levels, poverty rate and critical development measures diverge significantly.

At the turn of the new year, the World Bank had warned that by 2030 one out of four poorest in the world would be Nigerian, prompting President Muhammadu Buhari to reiterate his promise of laying the foundation for lifting 100 million people out of poverty in the new decade.

Expectations were that after a first term of delaying reforms, Buhari would take bold steps necessary to unlock growth.

Already, the country has weakened the official exchange rate and removed petroleum subsidy, among other things. But experts are wary that such moves, which are half-steps, might just be a crisis response rather than proper reforms.

Soft landings Adi said the problem Nigeria faces isn’t an economic one

but a health crisis which means economic recovery cannot be left to isolated individual decisions of economic agents.

He said the impact of the virus fallout would be lessened and Nigeria would see a “V-shaped recession”, which means quick rebound if the government can protect assets with human capital and jobs as top priorities.

Adi said the FG can organise negotiations with lenders at a national level to extend the moratorium on loans, bringing all stakeholders to the table to fashion out a deal.

He said the government can offer guarantees to companies so they do not lay off workers while tax breaks would be a big stimulus for the economy.

The government should also raise capital, however it can, to invest in energy and transportation which would reduce cost for businesses and support the real income of consumers, Adi said.

In addition, Nigerians must be willing to freeze interest rates to allow the financial system to stabilise.

The IMF estimates that Nigerian growth would rebound by 2.4 percent in 2021 but economists express worry over the volatile oil earnings and what an elongation of a low-growth cycle would mean for its 200 million people.

Other economists say to reduce the impact of the looming economic contraction on Nigerians, a broadbased stimulus and liquidity facilities to reduce systemic stress in the financial system are needed. This would lift confidence and prevent an even deeper contraction in demand by limiting the amplification of the shock through the financial system and bolstering expectations for the eventual economic recovery, they said.

Although partial recovery is projected by the IMF in 2021, the level of GDP will remain below the pre-virus trend with considerable uncertainty about the strength of the rebound.

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buyback.

“The outlook for the market remains bleak,” he said.

Gains in Dangcem (10 percent to N133.1), Zenith Bank (9.66 percent to N15.9) and Nigerian Breweries (9.84 percent to N26.8) helped pare broad market’s year’s loss to 16.03 percent.

Afrinvest noted that investor sentiment as measured by market breadth (advance/decline ratio) rose to 2.5x from the 2.4x recorded in the previous session as 27 stocks gained relative to 11 losers.

Analysts say IMF’s prediction of a brutal recession in 2020 would weigh on the stock market outlook for the year.

The International Monetary Fund (IMF) on Tuesday projected Nigeria’s economy would contract by -3.4 percent in 2020 from 2.2 percent in 2019, although with a rebound of 2.4 percent in 2021.

Also, the inflation rate is projected to rise by 13.4 percent in 2020 from 11.4 percent in 2019 and to moderate to 12.4 percent in 2021, higher than the Central Bank of Nigeria (CBN) single-digit target of 6-9 percent.

While the outlook is grim, a recent BusinessDay report suggests that long-term investors can still position in the cheap market ahead of stabilisation in the global and domestic economy.

Historical data tracked

by BusinessDay show that market recovery could be very swift after an economic downturn, and long-term investors who are bullish at the time of the market downswings get a good run-up for their money.

“We have been in a similar scenario before and history has shown that the markets bounce back time and time again,” Moses Hammed, an analyst at financial services firm Investment One, said.

Despite declines in the Nigerian Stock Exchange between 2014 and 2016, the market was able to post a 42 percent return in 2017 to emerge one of the best performing bourses globally.

Analysts say the market would in the meantime continue to alternate between gains and losses on bargain hunting while improvements in the pandemic situation and oil market would help improve investor sentiment.

COVID-19: Community spread now...

Continued from page 2

the spread of the virus,” the doctor said.

Authorities in Lagos have recently embarked on houseto-house testing of residents and this is primarily responsible for the spike to 30 in the number of confirmed cases reported on a single day on Tuesday.

Nigeria has reported 373 positive cases of coronavirus as at 4:00pm on Wednesday, with 99 recoveries and 11 deaths recorded.

Another doctor who spoke with BusinessDay said the spike as well as the shift in the social classification of the cases being encountered currently may mean that the virus is spreading faster.

“Initially, the people who were coming in with the virus were predominantly people with travel history, people in the upper social class. Today, that is changing. We are now seeing people without travel history and irrespective of social class, they are now presenting with the symptoms,” he said.

The physician said some of these people are those “who have not been flagged, that is, they have not travelled recently, and have no connection with anyone who has travelled. In a way, people you cannot really account for.”

This could mean “we are @Businessdayng

really about to have a real outbreak”, the doctor said. It could be another one month or so before signs that the curve is flattening, he explained.

Compared to peers, Nigeria has so far tested an insignificant proportion of its people and there could yet be a huge underestimation of the number of cases in the country.

The two doctors agreed that the lockdown is helping Nigeria slow the rate of spread of the virus and they welcomed the help that has come from the private sector.

“The outbreak has truly exposed Nigeria’s health system for what it is and what I have seen is the stark unpreparedness of our health system – the people, the infrastructure and process – to handle an emergency like this one,” one of the doctors said.

Nigeria is in its third week of lockdown and while the government is expected to begin to relax the restriction in 12 days, the health workers who spoke to our reporters said care must be taken to ensure that the gains already secured are maintained.

They suggested a gradual relaxation that may see places of worship, cinemas as well as parties, large conferences and other similar large gatherings still being prohibited.

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Thursday 16 April 2020

BUSINESS DAY

Corporate Social Impact

Onuwa Lucky Joseph (08023314782) Editor.

Covid-19 Shutdown:

Project Ark deploys Community-Led intervention to prevent hunger spread Onuwa Lucky Joseph

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n times of distress like we have now, money is but just one way of helping out. In fact, money, not well deployed, takes us back, if not further back, from where we were before the money was made available. Which is why ‘throwing money at problems’, for the most part, is an endeavour in futility.

While CaCovid is reeling in the big money from the big corporates and individuals and ensuring that moneys pooled are geared towards fighting Covid 19, we can be almost sure that such private sector intervention, coming as it is from the big corporates, will most likely gloss over some of the more pertinent survival issues that the ordinary Nigerian has to contend with.

The objectives of the coalition, as outlined by the CBN, are rather broad based: • Mobilize private sector thought leadership, • Mobilize private sector resources • Increase general public awareness, education and buyin • Provide direct support to private and public healthcare’s ability to respond to the crisis • Support Government

Emmanuel Dania, Member, Board of Trustees

Alero Ayida-Otobo, Member, Board of Trustees

Simi Nwogugu, Member, Board of Trustees

effort It’s clear that there are gaps that must be filled for the fight to result in victory for us all.

The good news is that some people are thinking and willing to do the necessary in order to bring about the desired results.

One such assemblage is The Project Ark, designed as a technology driven initiative to provide for the vulnerable during the COVID-19 shutdown. Its first accomplishment has been the impressive roll out of food distribution in the Ikota Community of Lagos State.

Project Ark, which was launched as a response to the plight of the homeless, lowincome and daily wage earners during the shutdown distributed food items to 500 households in Ikota on Saturday, 4th April, 2020, and with a commitment

to feed 4000 households for two weeks.

How will they do it? The Group says it’s by “using a technology-enabled, systematic and strategic approach to collecting and distributing dry and cooked foods, as well as sanitary items by employing a ‘One for all, All for one’ method that ensures no one is left to starve or in danger of infection.” And so, although they also request donations, “Project Ark aims to support and enhance the work of other initiatives distributing relief materials in the fight against COVID-19”.

A key part of the initiative is the involvement of the community in the execution process, with the aim of igniting a culture of generosity and encouraging citizens to be there for one another as we build strong communities.

According to Alero AyidaOtobo, the Visionary of Reformers Arise Network and a member of the Board of Trustees of the Project Ark “We want to go beyond giving handouts to encouraging a united effort towards solving the challenges we face as a people. An attitude of caring for our neighbors is much needed in these times and even afterwards. We want people to be able to adopt this system and implement it in their own communities to solve different social challenges”.

According to its sponsors, “Since the soft launch of Project Ark, almost 200 people and organizations have contributed to the effort through donations of cash and food items, as well as offers to volunteer and provide a service. The train will move into more communities across

Nigeria in the coming days and weeks”.

The Ark Project board of trustees include: Alero Ayida Otobo, Transformation Strategist and Founder, Incubator Africa; Imo Oyewole, Managing Consultant of Global Talent Network-HR Consultants (GTN-HR); Emmanuel Dania, CEO AmouroG Oil & Gas and Co-Founder of Astral Media; and Simi Nwogugu, Executive Director of Junior Achievement Nigeria (JAN). The project is currently supported by the Lagos State Government, Media Link Ltd, Value Media, Union Bank, Nestle, Bella Naija, AACE Foods, and the House of Prayer.

It also currently has a complement of 86 volunteers and has snagged, as at the time of going to press, N14,000,000 in donations so far.

They enjoin Nigerians with a heart to support the initiative to visit www.theprojectark.com.ng to volunteer or register the items they would like to donate. Food and household donations will be picked up from each person’s doorstep while cash donations can also be made online.

For more information and updates about the Project Ark initiative, you can follow their social media handles - @theprojectarkng on Instagram, Twitter, and Facebook.

Shareholder capitalism isn’t dead, it just changed its name to stakeholder Capitalism

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n our headlong search for what comes after shareholder capitalism, we have at long last discovered that stakeholder capitalism is still the same capitalism. And that’s good news.

By Stephen Denny, Managing Director, Denny Leinberger Strategy “Capitalism as we have known it is dead, and this obsession that we have with maximizing profits for shareholders alone has led to incredible inequality and a planetary emergency,” Salesforce. com CEO Marc Benioff said at the 2020 Davos World Economic Forum, explaining that, “When we serve all stakeholders, business is the greatest platform for change.”

Marc Benioff

Satya Nadella, CEO Microsoft

Many luminaries of the capitalist world, from Benioff to Microsoft’s Nadella to Germany’s Merkel to others, both from academia and industry, have decried capitalism and suggested that in its place a new paradigm

is emerging, one that serves more than just the shareholders of the company and that can act as a catalyst of change.

Indeed, the rise of brand values alignment and the need for brands to stand for something

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more profound than the sum of their speeds and feeds gives us ample evidence that the buying public demands more of brands than the stereotyped robber baron capitalism presented in the media The “New Capitalism,” per the Business Roundtable-- as well as the World Economic Forum consensus-- is that stakeholder capitalism has trumped shareholder capitalism. We as stewards of business must be aware of and specifically cater to a much wider set of constituents, from employees and customers to the environment and society at large. And while many companies have stumbled when trying to embrace social causes too far from their own core brand DNA, @Businessdayng

we the people now expect more from the brands we choose to embrace.

But is this new? Does stakeholder capitalism mean that shareholder capitalism is “dead,” as so many bright people have suggested?

It’s clear that there is great energy around the idea that we must expand our thinking to include different stakeholders beyond the narrow confines of the shareholder set. But it’s equally clear that if you serve stakeholders well, you’ll serve shareholders, too.

Technology has emerged as the single most profound cultural driver in the world today.

Continues on page 31

Thursday 16 April 2020

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Corporate Social Impact Lockdown Blues:

The looming unrest below the diaphragm Onuwa Lucky Joseph

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remember this particular line from one of the General Studies classes I took in the mid-80s in the university. It was a line popular with the radicals and Marxist Leninists of the time. It goes something like ‘There can be no peace (in the world) when there’s no peace below the diaphragm’. Unfortunately, despite many attempts at Googling it, I have come up short. I therefore cannot here give a proper attribution.

But you get where I’m coming from. Below the diaphragm (in the human anatomy) is where the stomach is located. And when that place is empty and growling, nothing else in the world matters. It’s far worse when a man, a family man, watches his family, especially his young children, hungry, yawning, irritable. What does he do?

And he’s forced to stay at home.

And he’s not sick. He’s not weak; he’s not a lazy youth, or a lazy elder. He’s willing and able to

go bring home the bread. But he can’t because there’s a lockdown by a government that has made no real provision for him.

That is bad. But even worse off are the many women in the rural areas and the urban centres who are the principal bread winners of their families. Their petty sales and produce businesses have been truncated by the lockdown.

They are hungry and their families are hungry. And what’s that thing we know about hungry folks? They are angry. They can be unappeasably angry.

We’ve seen examples of that in different parts of the country.

In Abuja, a few days ago, a taxi driver, in an indelible image that was splashed all over social media stripped himself of all his clothes to protest the seizure of his taxi. His question was ‘What have I done to Nigeria? Why is Nigeria treating me like this?!

While we reckon that government means well, this wholesale transplant of a solution that may not have been properly assessed for workability here before being

imposed is causing a myriad of avoidable pain. First, we didn’t diligently weigh the statistics.

Nigeria is the undisputed poverty capital of the world. With 94.5 million desperately poor as of April 2017, the country overtook India as the country with the highest number of POOR people in the world. Three years after, we still cling tightly to that dubious title.

The most impacted sector of the economy is the SME Sector which according to PwC contributes 48% of national GDP, accounts for 96% of businesses and 84% of employment. A lot of these businesses which were barely surviving before Corona came along simply do not have the resources to pay staff for services not rendered. And we are not even talking about the Micro businesses (typically the one man or less than 5 people operation) where daily pay is usually premised on returns for the day. The transport and trading sectors falls into this category.

Shareholder capitalism isn’t dead...

Handheld technology is now a given in life, with smart phones making it push-button easy to join a movement to support a brand that has taken a stance that aligns with your own, or to boycott a brand than does something you don’t like. In the most recent Culture and Technology Intersection study produced by my consultancy, Denny Leinberger Strategy, we found that 41 percent of U.S. Millennials had taken active steps to support brands that aligned with their values. We find it interesting to note the differences in the attitudes of US adults 18 and older, particularly when we break things down by age cohort - when we look at US adults 18 and older as a single group, we see only 29 percent of this general population agreeing with this sentiment. Similarly, when it comes to boycotts, 46 percent of U.S. Millennials had avoided supporting brands that ran counter to their values, compared to 38 percent of the whole of U.S. adults.

This means brands are more visible and more sensitive to shifts in consumer sentiment today than at any other time in history. It’s hard to be a hero when everyone has a camera.

Brand managers have to take a wider view of stakeholder needs

because each group has a voice, a network, and strong point of view about whether the brand is doing good or evil.

We expect brands to do more.

This explosion of technology has given us the means to know more about the brands we care about and take action on what we learn. From the Culture & Technology Intersection study, we learned that 49 percent of U.S. adults 18 and older believed it was important to learn as much as possible about the brands they buy (33 percent had no opinion, with only 18 percent disagreeing).

When asked if knowing what a brand stands for is equally important as knowing what it can do for me, 55 percent of U.S. adults agreed. Interestingly, when asked whether they agreed with the idea that brands should take a stand on social or political issues regardless of the financial impact to the company, 53 percent of U.S. Millennials agreed versus 41 percent of the U.S. adult population - with agreement sharply declining as we looked across older age groups.

This means the ability of the public to research and learn about your brand goes far beyond what you put on your website - and they will make purchase decisions based on what they learn. www.businessday.ng

Brands that do good grow faster.

A 2019 research study from New York University’s Center for Sustainable Business (CSB) reports that sales of sustainability-marketed products grew 5.6 times faster than conventionally marketed products, when measured by gross merchandise value. In over 90 percent of the individual product categories, the sustainability-marketed products outperformed their conventional counterparts.

Further, a 2019 Unilever study concluded that 33 percent of consumers were choosing to buy from brands that they believe are doing social or environmental good.

Everything we’d discussed above suggests that brands that embrace stakeholders-- from values to sustainability and beyond-- tend to do better than those who don’t.

And this applies directly to shareholder value, as we’ve just explored.

So join me in welcoming the “New Capitalism” to the world stage. It may sound a little different, but it still delivers results-this time, for everyone.

Culled from Int.com

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It is not surprising therefore that an overwhelming majority (77%) of Nigerians, according to a recent NOI Poll, fear a looming hunger crisis as the lockdown persists. Gripping hunger that comes from Lack of money to purchase food Exorbitant food prices; Shortage of food stuff occasioned by the lockdown (and therefore inability of trucks conveying foodstuff to make the necessary inter-state runs) And Nigeria was just coming out of a recession!

So, while it is true that Covid 19 is highly infectious, it is at the moment more vexatious than infectious. There’s a railing by people justifiably miffed at the liberty denied them by this ‘imported’ ailment that a lot of them have only heard about but know no one who suffers from it. Youths in Kano were at the Emir’s palace recently chanting “Ba Corona! Ba Corona!!” meaning, “There is no Corona!” They want to be free to go about their

daily business of keeping body and soul together.

Like millions of their poor countrymen, they would rather confront Corona than hunger.

And another uncertain 14 days, for many Nigerians, is a sacrifice too great to make for a country that they know pays no mind to their welfare or well being.

For the lockdown and the anti-Corona campaign to succeed therefore, government must ramp up its welfare efforts. Even though that amounts to putting the cart before the horse, it is the only way to salvage the effort so that people don’t become so driven by desperation that they confront law enforcement agents prowling the streets looking for offenders. Cacovid must also look at how a good chunk of what they raise can be deployed to feeding millions of vulnerable Nigerians.

Security is another flashpoint that cannot but be addressed.

Hunger and desperation should not drive more people into considering crime as a viable option.

Covid 19: Fresh Commitments/Developments

• Chagoury Brothers donate N1billion to Lagos State Govt • Toyota Nigeria Limited Donates 3 ambulances to Lagos State • Stallion Group to supply free local rice and fish to government run hospitals that are dedicated to COVID-19 across Nigeria for the next three months. Will also provide 5staff buses for the government run Covid 19 hospitals • Guaranty Trust Bank grants Small and medium Scale Enterprises, SMEs, a 90 day grace @Businessdayng

period on loan repayment.

SMEs to benefit from this grace period are those in the food/ drink industry, fashion/beauty industry as well as individuals, specifically salary earners who need instant money to offset bills.

• Don Jazzy – Gifts N100,000 to old woman who was going to deal sex in return for N500 to feed her kids (Kindly send feedback to 08023314782 / csrmomentum@gmail.com)

32

Thursday 16 April 2020

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Wednesday 15 April 2020

Top Gainers/Losers as at Wednesday 15 April 2020 LOSERS

GAINERS Company

Opening

Closing

Change

DANGCEM

N121

N133.1

12.1

NB

N24.4

N26.8

2.4

N20.45

N21.9

1.45

GUARANTY

ZENITHBANK

N14.5

N15.9

1.4

DANGSUGAR

N11.7

N12.7

1

Company

Opening

Closing

Change

N6.5

N6.2

-0.3

ARBICO

N2.85

N2.57

-0.28

GUINNESS

N22.7

N22.5

-0.2

CUTIX

N1.32

N1.2

-0.12

N0.62

N0.56

-0.06

UBN

WEMABANK

ASI (Points) DEALS (Numbers) VOLUME (Numbers) VALUE (N billion) MARKET CAP (N Trn)

22,539.94 5,166.00 326,444,379.00 3.338

to N6.2, losing 30kobo or 4.62percent.

The market’s benchmark index (NSE ASI) increased by 3.02percent from preceding day low of 21,879.95 points to 22,539.

94 points on Wednesday April 15.

The market’s negative return year-to-date (YtD) has moderated to -16.03percent. This week, the market has yielded positive return of +5.41percent while this month it has increased by +5.82percent.

The value of listed stocks on the Bourse increased by about N340 billion from N11.402trillion recorded the preceding trading day to N11.746trillion.

FBN Holdings, Zenith Bank, GTBank, UBA and FCMB were actively traded stocks on Wednesday.

In 5,166 deals, equity dealers exchanged 326.44million units valued at N3.33billion.

The bonds market cap stood at N13.488trillion while Exchange Traded Funds (ETF) stood at N6.3billion.

N

igeria’s stock m a r k e t continued its rally on Wednesday April 15, achieving its second consecutive gain this week.

Investors in their bargain mood raised bets in value counters like Dangote Cement Plc and other largely capitalised counters.

The share price of the cement maker increased most by N12.1 or 10percent, from N121 to N131.1 while that of Nigerian Breweries followed after moving from N24.4 to N26.8, adding N2.4 or 9.84percent.

GTBank and Zenith Bank were also on the bargain list. While the former advanced from N20.45 to N21.9, adding N1.45kobo or 7.09percent, the later rose from N14.5 to N15.9, adding N1.4 or 9.66percent.

On the decliners list, Union Bank led the pack after its share price moved from day open high of N6.5

Coronation Merchant Bank holds virtual AGM, appoints substantive Managing Director Iheanyi Nwachukwu

C

oronation Merchant Bank Limited held its 5th Annual General Meeting (AGM) on Tuesday, April 14, 2020.

The meeting, which took place at the Bank’s head office, was held in strict compliance with social distancing rules and the directives of the Federal and Lagos State Governments.

Only nine persons attended physically, while others participated via video conference.

The Bank’s audited figures presented showed a 14percent increase in Profit After Tax from N4.484 billion in 2018 to N5.097 billion.

Total Assets grew by 14percent from N222.78 billion in

2018 to N253.35 billion. Cost of risk remained at a healthy level of 0.05percent while the Bank sustained its zero NonPerforming Loan ratio indicative of strong risk management practices and good quality of risk assets.

The shareholders were informed that the Central Bank of Nigeria recently approved the appointment of Banjo Adegbohungbe as the substantive Managing Director/CEO following the retirement of Abubakar Jimoh, who led the leadership team of the Bank from inception in 2015 until recently when he commenced his terminal leave.

Commenting on the appointment of Adegbohungbe as MD/CEO, the Acting Chairman noted that, “The seamless www.businessday.ng

transition in the Bank’s leadership is a result of deliberate succession planning by the Board, in line with its commitment to strong corporate governance standards. In the past 20 months, Banjo has distinguished himself in service to the organization and contributed immensely to the overall growth of the Bank. We are confident that his appointment will further strengthen andposition the Bank for improved performance”.

He further stated that: “The outgoing Managing Director, Abubakar Jimoh, gave himself to the growth of the Bank, having led a team that turned around a nearly-extinct Associated Discount House Limited and converted it to an “A+ rated” merchant bank in

Nigeria within five years of its existence. We will always be gratefulto Abu for his years of service to the Bank and for the strong values he instituted in the organization”.

The outgoing Managing Director/CEO, Abubakar Jimoh acknowledged the wise counsel and professional guidance that he and his leadership team enjoyed from the Board of Directors and other key stakeholders that contributed to the Coronation MB success story.

He also congratulated the in-coming MD/CEO for his well-deserved appointment, and appealed to the Board members and all stakeholders to accord him a higher level of support that will propel him to greater success

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FTSE 100 Index 5,597.65GBP -193.66-3.34%

Nikkei 225 19,550.09JPY -88.72-0.45%

S&P 500 Index 2,770.73USD -75.33-2.65%

Deutsche Boerse AG German Stock Index DAX 10,279.76EUR -416.80-3.90%

Generic 1st ‘DM’ Future 23,191.00USD -689.00-2.89%

Shanghai Stock Exchange Composite Index 2,811.17CNY -16.11-0.57%

11.746

Market rallies further as investors hunt for Dangote Cement, other value stocks Stories by Iheanyi Nwachukwu

Global market indicators

FBN Holdings notifies NSE of discussions with Sanlam to divest from FBN Insurance

F

BN Holdings Plc on Wednesday April 15 formally notified the Nigerian Stock Exchange (NSE) of on-going discussions with its partner Sanlam Emerging Markets (Sanlam) the owners of 35percent equity in FBN Insurance Limited (FBNI) regarding the proposed sale of the Company’s 65percent equity in FBN Insurance Limited.

According to the formal notice sent to the Exchange and signed by the Company Secretary Seye Kosoko, FBNH stated that the move is in line with the “Group’s strategic objectives” adding that they are currently engaging the regulators for the necessary approvals.

FBN Holdings however assured the Exchange that further announcement will be made if the transaction is concluded. The proposed divestment is said to be a strategic business decision for FBNH. When completed, the transaction will involve the transfer of FBN Holdings’ 65 percent stake in FBN Insurance Limited to Sanlam.

The notification to the Nigerian Stock Exchange is one of the statutory steps required of listed companies when considering a market-sensitive decision or transaction.

In deference to Rule 17.5 of the Rule Book of the Exchange 2015, FBN Holdings first notified the market of the development in the Directors’ Report Section of its Audited Financial Statements for the year ended December 31, 2019 which was released to the Exchange on Monday 6, April 2016.

For the financial year ended December 31, 2019, the Company posted a Profit Before Tax (PBT) of N84billion representing a growth of 31percent over 2018 PBT of N64billion.

Profit After Taxation (PAT) at N74billion was a growth of 27percent over N58billion reported for 2018.

The company’s Board of Directors has also recommended the payment of the sum of N13.64billion (38kobo/Share) as dividend to its Shareholders representing a growth of 46percent over prior year dividend.

The proposed divestment will unlock significant value to leverage the Group’s strength in its core business for which it is renowned.

FBN Insurance was founded as a Life Insurer in 2010 with a vision to be Nigeria’s first choice in risk underwriting, wealth preservation and financial security.

NSE publishes guidance to facilitate effective virtual meetings for stakeholder amid Covid-19

T

he Nigerian Stock Exchange (NSE) on Wednesday April 15, published guidance on virtual Board, Committee, and Management Meetings for stakeholders.

The Guidance is in response to the shift from conventional physical meetings to virtual meetings precipitated by the COVID-19 pandemic, and the critical need to protect investors’ interests.

It is one of The Exchange’s “Thought Leadership” initiatives, designed to provide direction to market and other stakeholders on carrying out successful, productive, and rewarding virtual meetings at this time and other times when in-person meetings are unfeasible.

Commenting on the Guidance, Chief Executive Officer, NSE, Oscar N. Onyema, said, “The NSE has provided this Guidance to assist our stakeholders with identifying and adopting best practices and procedures, and complying with applicable corporate governance standards whilst conducting their virtual meetings.

@Businessdayng

“The goal is to ensure that when companies opt for virtual participation in meetings, they are accessible, transparent, efficient, and cost-effectively managed, while meeting the important business and corporate governance needs of all relevant stakeholders.”

In addressing concerns around virtual meetings, Executive Director, Regulation, NSE, Tinuade Awe, said, “The Exchange recognises the legal and regulatory uncertainties that Nigerian businesses may face regarding convening virtual meetings in the wake of the COVID-19 pandemic. More so, in light of the fact that the Companies and Allied Matters Act, Cap. C20 LFN 2004 (CAMA) is silent on the issue of virtual meetings. However, CAMA does not expressly prohibit virtual meetings. It is, therefore, expedient that the Articles of Association of a company or its Board, Committee, and Management Charters or Terms of Reference should provide for and authorize virtual meetings.”

Thursday 16 April 2020

BUSINESS DAY

33

news

Covid-19: Buhari lauds EU for N21bn donations ...condoles EU-member countries over Covid-19 deaths James Kwe & Innocent Odoh, Abuja

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resident Muhammadu Buhari has lauded the European Union (EU) for donating N21 billion (about €50m) to support Nigeria’s efforts at controlling the spread of the coronavirus pandemic.

A statement issued on Tuesday by Femi Adesina, special adviser to the president (media/ publicity), said Buhari, who gave the commendation Tuesday in Abuja while the EU delegation to the country, led by its ambassador, Ketil Karlsen, said the donation would go a long way in supporting Nigeria’s efforts at controlling and containing the virus to prevent community spread as well as revitalise the national health care systems.

President Buhari expressed sincere condolences of the government and people of Nigeria to EU-member countries and families who lost their loved ones as a result of the COVID-19 pandemic. ‘‘Our thoughts and prayers are with the families, friends and communities impacted.

We are confident from history that the resilience of Europe and our global collective will enable us to emerge stronger from this tragedy. ‘‘Although the EU is facing significant challenges due to this pandemic, I am indeed touched and grateful that the European Union still had the vision and foresight to remember its friends, partners and allies across the world,’’ he said.

He also lauded EU on the recent launch of the “Team

Europe” package to support countries in the fight against the coronavirus pandemic and its consequences.

The president noted that the intervention, which is a collaboration between EU, its member states, and financial institutions such as the European Investment Bank and the European Bank for Reconstruction and Development, would go a long way in ensuring the impact of this pandemic was controlled and contained. ‘‘Indeed, this brotherly support will save millions of lives.

Nigeria, Africa and many beneficiary countries across the world will remain grateful for generations to come,’’ he said.

He told the delegation that his administration had done a lot to date in the fight against COVID-19. ‘‘So far, the number of confirmed cases in Nigeria is 343.

Our efforts as a Government have focused on controlling and containing the virus to prevent community spread. ‘‘I want to assure you that in this fight, Nigerians are united and by the grace of God and the continued support from our partners, we shall succeed,’’ he said.

In his remarks, Karlsen described the donation, channelled through the UN COVID-19 basket fund, as so far the largest single contribution to the response in Nigeria and the largest support that EU was providing anywhere outside Europe. ‘‘We heard your call for assistance and the EU has reacted swiftly as a demonstration of our true partnership,’’ he said.

NCDC issues new advisory on use of face masks Godsgift Onyedinefu, Abuja

N

igeria Centre for Disease Control (NCDC) has recommended the use of face masks in its newly released public health advisory, but says it has to be used as an optional additional layer with other measures such as physical distancing, hand and respiratory hygiene measures.

The centre stressed that wearing face masks alone would not prevent spread of the Covid-19, explaining that the primary rationale for the advisory was to prevent those infected but asymptomatic from spreading the virus.

It also advised that face masks, which can be made out of cloth or other materials, be used while attending large gatherings (where it is absolutely necessary to attend), such as shopping outlets, markets, shops and pharmacies among others.

Older persons, above 60 with existing medical conditions such as diabetes are particularly encouraged to wear masks as they are at higher risk of infection. It also further advised that face masks are used by more vulnerable members of the

society, citizens with ongoing respiratory problems, and those already exhibiting symptoms and awaiting testing.

Given the global shortage of personal protective equipment including medical masks, NCDC advised that public sector resources should be preserved to procure medical masks for patients and healthcare workers who need them the most.

It said masks had to be properly disposed of in waste bins as improper handling and frequently touching of masks could increase the risk of infection, while improvised masks could be an option as long as they were properly washed regularly.

The centre however noted that wearing of face masks alone would not protect against COVID-19, but must be combined with physical distancing, hand washing, respiratory hygiene, cleaning and disinfecting frequently touched surfaces and other advice from NCDC. “It is important to remember that the usage of face masks alone cannot be relied upon to avoid the COVID-19 virus; physical distancing, hand and respiratory hygiene measures are necessar for protection from the virus,” it stressed. www.businessday.ng

Members of the TG Arla Dairy Products LFTZ Enterprise, maker of Dano Milk, during donation of N50m worth of products to the Lagos Food Bank Initiative recently.

Nigeria’s mobile transfer volume surges by 741% in first 3 months of 2020 BUNMI BAILEY

N

igeria’s digital payment space experienced a surge in the first three months of 2020, as the volume of money transfers via mobile phones increased by 741.4 percent.

BusinessDay analysis of the data from the Nigeria Interbank Settlement System (NIBSS) shows that the volume of mobile inter-scheme transactions (mobile transfers) increased year-on-year by 741.4 percent to 24.4 million in the first three months of 2020 from 2.9 million in the same period of 2019.

Also, its value rose year-onyear by 374.1 percent to N451.3 billion in the first three months of this year as against N95.2 billion in the same corresponding

period in 2019.

“The surge was buoyed by CBN’s recent review on electronic transfers and other bank charges, which makes it more appealing to users. Merchants, investors, traders, wholesalers sector-wide have switched to mobile and internet banking because of the ease, security and convenience it provides,” Damilola Adewale, a Lagosbased economist said.

Nigeria has the largest mobile market in Africa with over 172 million mobile subscribers in 2018, accounting for a penetration rate of 87 percent of its population and represented a 6.4 percent growth increase, compared to 162 million subscribers in 2017, according to a report released by Jumia, Africa’s online retailer.

The CBN has been intensify-

ing its efforts to ensure financial inclusion of Nigerians. Last year, the apex bank moved the financial inclusion target from 80 percent in 2020 to 95 percent in 2024.

Also, Nigerian banks are trying to catch up with their counterparts in other parts of Africa in the provision of online and mobile banking facilities as part of efforts to deepen financial inclusion in Africa’s most populous country. Banks also have cut the cost per a mobile money transaction to N52.50 per transfer, down from N100.

The increased penetration or use of mobile banking had an impact on the volume of bank cheques as it reduced by 10 percent to 1.8 million from 2.0 million As regards Point of Sales (POS) activities, transactions

worth N1.0 trillion were carried out all over the country from January to March 2020, recording a 57.7 percent increase as against N633.8 billion.

The volume of POS transactions also rose by 66.6 percent from 83.8 million in the first three months of this year to 139.6 million in the same period of last year.

Ayodele Akinwumi of FSDH Merchant Bank said, “The investment that has been going in the tech mobile banking space and people’s confidence in it has led to the growth. A lot of banks and fintech companies are investing in the tech mobile space.

“And the fact that the banks have buffed up the security system to make it more secure than before is making people to have confidence to believe in the system,” Akinwunmi said.

COVID-19: FG blames alleged ill-treatment of Nigerians in China on poor communication Innocent Odoh, Abuja

... as Chinese envoy reiterates solidarity with Nigeria

ollowing the controversy that emerged that Chinese authorities in Guangzhou in the Guangdong Province have allegedly maltreated Nigerians and other Africans in their quest to enforce measures against COVID-19, the Federal Government has attributed the alleged ill-treatment on poor communication between the Chinese authorities and African consulates in Guangzhou, China.

Minister of foreign affairs, Geoffrey Onyeama, in company of the Chinese ambassador to Nigeria, Zhou Pingjian, said this while briefing reporters in Abuja on Tuesday, and urged Nigerians to be objective at all times in assessing incidents like that of Guangzhou.

Onyeama told reporters that Nigerian officials in China informed him that poor communication was responsible for efforts made by Chinese authorities to contain an incident of a lady who tested positive for the 2019 novel coronavirus in

the area.

The minister made reference to a video in both Igbo and English languages, which he said explained that the situation was not quite what was seen in the video of the alleged maltreatment of Nigerians.

He noted that there was a flight that conveyed a group of Nigerians to Guangzhou in which some Nigerians on the flight tested positive for COVID-19, saying among the Nigerians, was a lady who owned a restaurant in Guangzhou, who had tested positive.

He said the restaurant owned by the infected Nigerian lady was frequented predominantly and almost exclusively by Africans and Nigerians, adding that the Chinese authorities obviously picked up on this because there was this group of people who had tested positive allegedly patronising the restaurant.

“And so, automatically the Chinese authorities demanded and insisted that they all be

F

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quarantined, with nobody allowed to come out in 14 days and that if anybody came out from that quarantine, and that they should not be allowed in if it was a hotel, back into that hotel or that residence.

“So, they put in very, very strict measure to try to contain this outbreak which to them at that time, clearly seemed to have been within that community.

And so, they put in place, this very, very strict measure.

“Now, it was misinterpreted it appeared, by some of the Nigerians and Africans who could not understand why it seemed to be selective and targeting only themselves,” Onyeama said.

He explained further that having seen the video and received various calls from China, he, of course, alerted the Nigerian Embassy and officials in Guangzhou at the consulate, particularly the acting consul-general.

“And they confirmed that that narrative was the true narrative, that there were in other @Businessdayng

words, this case that had been confirmed is positive that came in from an African flight and that there was this lady who owned a restaurant, that who was positive and the great fear that all the clients visiting that restaurant and may be other restaurants might have been infected and might now be passing on that infection.

So, after their experience in Wuhan, they were very determined to contain this in this way.

“But what our officials in China made clear was that the communication could and should have been better if the authorities in Guangzhou had informed the consulates, the African consulates in Guangzhou that this was the situation, this was the measure that they were putting in place, it could have been a joint effort, a team effort and that mutual suspicion would not have been there. And of course, that was not done and that led to counter narratives and exacerbated the situation,” he also said.

34

Thursday 16 April 2020

BUSINESS DAY

FT

FINANCIAL TIMES

World Business Newspaper

Africa’s scientists learn from past epidemics to fight Covid-19

Experience with other outbreaks could compensate for poor healthcare infrastructure Neil Munshi

A

frican scientists and health officials are taking on coronavirus by adapting technology and systems developed to fight diseases such as tuberculosis and polio, an effort they hope will help compensate for the continent’s lack of critical care infrastructure.

“Technically, Africa is not better prepared,” said Christian Happi, director of the African Center of Excellence for Genomics of Infectious Diseases at Redeemer’s University in Nigeria. “But in terms of understanding diseases and combating outbreaks with limited resources, Africa is much better prepared because they deal with outbreak on a permanent basis.”

Mr Happi is one of Africa’s leading scientists. He helped sequence the Ebola and coronavirus genomes and last year deployed a test for Lassa fever using Crispr gene-editing technology at his state of the art laboratory in rural Nigeria. The deadly disease killed 161 Nigerians between January 1 and March 15.

Now he is using the same technology to develop a rapid diagnostic test for coronavirus. “We want to take that same approach for SARSCoV-2,” he said, adding that the test will find the RNA of the virus — the cellular information that would identify whether it is Covid-19 — and deliver a positive or negative result in about 30 minutes.

Key materials needed to produce the test including reagents are not available in Africa and will be slow to be delivered amid the

Scientists Onikepe Folarin and Christian Happi stand in front of a genomics centre under construction in Nigeria. Mr Happi helped sequence the Ebola genome © Amy Maxmen

global shutdown, he said, but the first prototype is expected to be ready in a “few weeks”.

Across the continent, government officials and other scientists are drawing on similar experiences to develop coronavirus solutions, despite weak health infrastructure and a severe shortage of life-saving equipment.

South Africa has increased Covid-19 testing using a network of over 200 public laboratories that was developed in response to past HIV and tuberculosis outbreaks.

It has conducted over 70,000 tests so far.

Meanwhile, WHO Africa has said it will use a data collection system originally set up to battle polio to track infections. Avadar,

as the system is known, uses a network of roughly 6,000 community members from traditional healers to village chiefs across 11 countries who can report symptomatic patients to WHO via their mobile phones.

Since its first application to track polio the system has also been used to hunt tuberculosis and Lassa fever. WHO maintains periodic contact with the community members in the network and sends explanatory videos when new diseases arise, helping officials to spot potential outbreaks early.

“Things we never used to notice before they became an epidemic, we now see the ones turn into twos into tens and we can respond faster,” said Godwin Akpan, a tech-

nical officer who works on data collection initiatives and polio eradication at WHO Africa.

This week the system will start to send messages to its network of informants asking “have you seen someone with a cough, or difficulty breathing” or displaying other Covid-19 symptoms, said Mr Akpan. “We just push it from the server on to their mobile at a very grassroots level.”

In west Africa, countries are deploying skills and surveillance techniques developed during the 2014-15 Ebola outbreak, which infected at least 28,000 people and killed more than 11,000, mainly in Guinea, Liberia and Sierra Leone.

Nigeria was praised for its success in containing the outbreak.

“I think the Ebola experience has really prepared Nigeria in a way because it means we have good alert systems,” said Dr Sani Aliyu, national co-ordinator for the country’s presidential task force on Covid-19.

Dr Aliyu said Nigeria is working to adapt its network of roughly 400 rapid TB testing machines to test for coronavirus and that teams deployed to trace Lassa fever will now investigate Covid-19 cases too.

But contact tracing still needed to be improved, he said, adding that the country had conducted only a few thousand tests by April 9.

“Three thousand tests in a population of 200m is really nothing,” he said. “I think if we were testing properly and really doing proper contact tracing, our numbers would be a lot higher, [and] that could reflect the rest of the continent as well.”

The pandemic is in its early stages in Africa but is so far following a similar trajectory to Europe. Nigeria had reported 343 confirmed cases as of Tuesday morning and the continent had recorded just over 15,000 confirmed cases.

“If we do have a bad spate of Covid like what’s happening in Europe . . . there will be problems because our infrastructure is really not prepared,” Dr Aliyu said. “The health system is not strong enough to withstand a major shock.”

That is one way most African governments have not learnt from past outbreaks, said Mr Happi.

Few have invested seriously in permanent healthcare infrastructure. “The unfortunate thing is I’m just a laboratory and a team working with me . . . we can’t prepare for the whole country.”

Italian debt sinks after ‘corona bond’ plan falters ‘It’s every man for himself’ as countries rack up debt to fight Covid-19 pandemic

Tommy Stubbington

I

talian government bonds are coming under increasing pressure despite the European Central Bank’s huge asset-purchase programme, as investors worry about the enormous debt load Italy and other eurozone members are taking on to combat the coronavirus crisis.

A sell-off in Italy’s government debt extended to a second day on Wednesday, pushing the country’s 10-year yield to a four-week high of more than 1.8 per cent. Bonds issued by Greece, Portugal and Spain also weakened.

The gap between Italian and German yields — a measure of risk in eurozone bond markets — widened to more than 2.2 percentage

points, reversing more than half of the narrowing seen since the announcement of the ECB’s €750bn Pandemic Emergency Purchase Programme on March 18.

The shake-up underlines that without a way to pool risk across all euro members, investors will be forced to focus on the financial risk each country is taking on to fight the pandemic.

“What matters to markets is the sense that we are not seeing solidarity at a time of crisis. Instead, it’s every man for himself,” said Mark Dowding, chief investment officer at BlueBay Asset Management. “That is going to fuel Euroscepticism, which eventually sees fears of a break-up getting priced in. As an investor, I think that dynamic is more important than the finer points of any eurozone deal.” www.businessday.ng

Fears over debt sustainability have intensified since eurozone finance ministers last week failed to include jointly issued so-called “corona bonds” in their crisisfighting package. An Italian push for shared debt was squashed by Germany and the Netherlands, which prefer to see relief efforts channelled through the eurozone’s bailout fund.

Italy’s debt burden will rise to more than 150 per cent of gross domestic product this year, up from 134 per cent last year, Rabobank is projecting. Debt will climb to 108 per cent of output in Spain and 128 per cent in Portugal, while Germany will see a much more modest rise to 63 per cent, according to the bank.

It’s not just an Italy issue, it’s right across southern Europe. We

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are moving back to a two-speed continent Richard McGuire, Rabobank Some fund managers are reluctant to buy into Italy’s relatively high-yielding debt despite the backing of the ECB, fearing a political backlash to the crisis that could reawaken questions about eurozone membership and weaken the bonds further. “[The] creditworthiness of member states is back at the centre of the market’s radar,” said Richard McGuire, a rates strategist at Rabobank. “It’s not just an Italy issue, it’s right across southern Europe. We are moving back to a two-speed continent,” he said.

Yields in Italy are still well short of the peak of almost 3 per cent hit a month ago and far below the @Businessdayng

heights reached during the eurozone debt crisis. Heavy buying by the ECB has ensured all eurozone members can borrow from bond markets. Greece, considered the bloc’s riskiest issuer, gathered robust demand for new sevenyear debt on Wednesday. Athens received more than €5bn of orders for the bond, its first since junkrated Greek debt was included in the ECB’s purchase programme.

The central bank bought more than €20bn of bonds under the PEPP last week, on top of €30bn the week before. The ECB may need to step up the pace of purchases in order to keep a lid on yields, according to ING rates strategist Antoine Bouvet.

“Benign borrowing conditions for the emerging debt tsunami will have to be ensured,” he said.

Thursday 16 April 2020

BUSINESS DAY

35

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Stocks slide on data showing economic damage from coronavirus

US and European shares falter after corporate results shed light on impact of global lockdowns Philip Georgiadis and Hudson Lockett

G

lobal stocks fell sharply on Wednesday, as new figures showed US economic activity had plunged and further signs of trouble were found in Wall Street earnings.

The S&P 500 and Dow Jones both fell 2.3 per cent at the opening bell in New York, while the tech-heavy Nasdaq was 1.9 per cent lower, after data illustrated the scale of the economic slump in the US. Industrial output fell by the most in more than 70 years in March while retail sales posted a record 8.7 per cent drop. A gauge of business activity in New York state also plunged to a record low in April.

European stocks slipped following a downbeat session in Asia, leaving the Stoxx 600 index on course to end a five-session winning streak. London’s FTSE 100 fell 3 per cent, while the CAC 40 in Paris was 3.2 per cent lower and Frankfurt’s Dax was down 3.5 per cent.

European and US stock markets are trading more than 20 per cent above mid-March lows on optimism that the rate of Covid-19 infections is peaking. But this quarter’s corporate results season looks set to test the strength of the rebound, as they shed light on the impact of the lockdowns that have stifled economies.

The CSI 300 slipped after the People’s Bank of China cut its one-year medium-term lending facility © Aly Song/Reuters

Goldman Sachs, Citigroup and Bank of America on Wednesday all prepared for more pain among their clients by setting aside billions of dollars to cover loan losses as they reported firstquarter numbers.

Wall Street analysts forecast an 8 per cent decline in S&P 500 profits this year, which would mark the biggest fall since 2009, in the depths of the financial crisis.

Strategists at Barclays said “dire” results in Europe should not be a shock to markets, but could offer a “reality check” following the recent swing higher.

“Sharp downgrades lie ahead and unusually vague guidance due to the fluid situation won’t improve visibility,” the bank’s European equity strategists wrote

in a note to clients on Wednesday. “Yet with central banks ‘all in’, unprecedented government bailouts and signs of a slowing outbreak, a second-half recovery seems more likely than not.”

Analysts expect 20 per cent falls in profit for the Stoxx Europe 600 this year, according to FactSet data.

The dollar rose, piling pressure on to emerging market currencies. The South African rand lost nearly 3 per cent of its value, while the Turkish lira slipped 1.3 per cent.

“The market mood has soured in the blink of an eye,” said Mark McCormick, global head of FX strategy at TD Securities.

A sharp fall in the price of oil also weighed on shares, after a

new forecast for global crude demand estimated it would plunge even if lockdowns and travel bans were lifted.

Oil majors including Total, BP and Shell each fell around 5 per cent, while Brent crude was down 4.5 per cent to $28.25 per barrel.

Asia-Pacific stocks fell following further indications the pandemic was set to hit the global economy hard, with the IMF warning of the biggest worldwide slowdown since the 1930s.

“The publication of the IMF’s spring forecast has rather put the dampeners on the brightening market mood,” said Société Générale strategist Kit Juckes.

Sentiment was also dented by President Donald Trump’s announcement that the US would

suspend funding to the World Health Organization, accusing it of “severely mismanaging” its response to the crisis.

In China, a brief boost to investor sentiment — spurred by its central bank’s decision on Wednesday to cut a key lending rate — quickly faded.

The CSI 300 of Shanghai and Shenzhen-listed stocks fell 0.7 per cent after the People’s Bank of China cut its one-year mediumterm lending facility by 0.2 percentage points to 2.95 per cent, the lowest level since its introduction in 2014.

Markets might still be too optimistic about the recovery in China Nomura Michelle Lam, Greater China economist at Société Générale, noted significant monetary support from the US Federal Reserve had given Beijing more breathing room to loosen its own policy.

But analysts at Nomura said markets “might still be too optimistic about the recovery in China”, as the country faces the dual challenges of falling external demand and the possibility of a second wave of coronavirus cases that could once again disrupt the economy.

Japan’s benchmark Topix index closed flat, while Australia’s S&P/ASX 200 fell 0.4 per cent and Hong Kong’s Hang Seng shed 1.2 per cent.

The 10-year US Treasury yield, which falls as bond prices rise, was down 0.08 percentage points at 0.66 per cent as investors sought safer assets.

Goldman lifts loan reserves as it braces for client pain Net income falls 46% to $1.2bn for first quarter Laura Noonan

G

oldman Sachs’ firstquarter results were dragged down by provisions for losses on loans to its investment bank clients, proving that the Wall Street bank is not immune to the credit woes suffered

by America’s main street lenders.

Goldman, which is in the early days of a historic reshaping under chief executive David Solomon, reported net earnings of $1.2bn for the quarter ended in March, down 46 per cent year-on-year but better than analysts had expected as revenues from fixed income trading and investment banking soared.

The overall decline in profits was roughly in line with a 46 per cent fall in net income reported

by Citigroup later on Wednesday morning and close to a 40 per cent fall reported by Bank of America

The biggest cause of Goldman’s reduced profits was the amount set aside to cover potential losses in its investment banking book © AP

earlier in the day.

Goldman did better than the 89 per cent fall in first-quarter profits at Wells Fargo, and a 69 per cent drop at JPMorgan Chase reported on Tuesday. “It’s just business mix,” said Marty Mosby, analyst at Vining Sparks, noting that the capital markets areas that Goldman has heavy exposure www.businessday.ng

to “did so well” in the first quarter, while credit losses would be bigger at the universal banks.

Goldman set aside $937m in provisions for loan losses in the first quarter, up from $224m a year earlier. That includes $622m allocated to cover losses on loans to Goldman’s investment banking clients and $168m of provisions

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for its wealth management and consumer division, which includes online lender Marcus and its Apple card.

Goldman’s investment banking revenue rose 25 per cent year on year, beating its peers, while its trading powerhouse posted a 28 per cent rise in revenues in the first quarter — including the best quarter for fixed income trading in five years.

“Our quarterly profitability was inevitably affected by the economic dislocation. As public policy measures to stem the pandemic take root, I am firmly convinced that our firm will emerge wellpositioned to help our clients and communities recover,” Mr Solomon assured.

Glenn Schorr, analyst at Evercore ISI, said the results were “a little bit better than expectations”, thanks to investment banking revenues and fixed income trading. He added that Goldman “will @Businessdayng

have to weather a near-term falloff in capital markets revenues as markets normalise.”

At its January 29 investor day, Goldman detailed plans to boost profitability to levels enjoyed by its peers, including a 14 per cent return on tangible equity by 2022 and $1.3bn of cost cuts.

“All those goals kind of go out the window now,’ said Mr Mosby. “As you go into downturns and recessions, you don’t look at returns, you don’t look at revenue growth or efficiencies gains, it’s all about right now.”

Goldman’s return on tangible equity for the quarter, at 6 per cent, was higher than the 5 per cent reported by JPMorgan on Tuesday.

Goldman’s overall trading revenue rise of 28 per cent compared with a 12 per cent underlying increase in trading revenues at JPMorgan Chase, which reports its trading figures after stripping out valuation adjustments.

36

Thursday 16 April 2020

BUSINESS DAY

FT

ANALYSIS

The battle at the heart of British science over coronavirus The UK government has been accused of paying too much attention to epidemiologists over other experts Jonathan Ford

I

n the spring of 2001, Britain was wracked by its first large scale epidemic of foot-andmouth disease since the late 1960s.

The country’s livestock farmers were still embroiled in the lockdown that accompanied Bovine Spongiform Encephalopathy (BSE), a neurological disease of cattle, that would slash beef consumption and exports for a decade.

Now they faced the risk of further curbs on animal sales, and the possible mass culling of their herds. Much depended on whether the government got on top of the outbreak fast.

Concerned at blithe official statements that the disease was under control, with the implication that aggressive countermeasures would not be needed, one official suggested turning to a novel source to investigate the course of the infection.

Sir John Krebs, then chairman of the British Food Standards Agency, encouraged the government’s new chief scientific adviser, David King, to recruit epidemiologists at three universities — Imperial College London, Cambridge and Edinburgh — to model the evolution of the disease. It wasn’t the first time that computer models had been built to study epidemics. The innovation was to try to do it in real time, in order to guide the response.

The independent modellers quickly exploded the government’s optimistic assumptions, showing the outbreak was on course to be far larger, and to spread faster, than officials expected. The government ramped up its response, imposing pre-emptive culls inside cordons around infected farmsteads, ultimately slaughtering 6m animals.

The extent to which modelling helped remains disputed, with some scientists claiming the intervention led to unnecessary culling. But most studies suggest it led to the outbreak ending earlier, with some scientists claiming that almost 1m fewer animals were slaughtered than if the government’s more relaxed stance had run its course.

That experience two decades ago has informed the way the government seeks to combat infectious diseases. In the UK one result was the establishment of the Scientific Advisory Group for Emergencies (Sage), a group of independent scientists and officials presently chaired by the chief scientific adviser, Patrick Vallance.

Convened periodically to handle specific crises, it has been advising the government on the coronavirus pandemic.

Its proponents claim this system has brought rigour to government decision-making that was sometimes absent in the past, mainly by separating science from

politics.

Sir David points to a notorious incident in May 1990 during the BSE crisis, when the agriculture minister, John Gummer, fed his four-year-old daughter a hamburger at the height of concerns over the risk of the disease being transmitted to humans, something that scientists were then still investigating.

A report suggesting just such a link was published in 1996.

The impression from the photo was that economic priorities trumped health concerns. “As the official report into the crisis suggested, the minister could seem concerned with other things than science, such as a desire to keep the market up for farmers,” Sir David says.

With the coronavirus outbreak, however, that separation between technical advice and politics has itself become contentious. The government stands accused of being too in thrall to science, in particular to epidemiologists, and of paying insufficient attention to other important factors such as the economy and behavioural science.

John Ashton, a regional director at Public Health England, has talked about the government treating its favoured epidemiologists as “demigods”.

Even Mark Woolhouse, professor of infectious disease epidemiology at Edinburgh university, while supportive of the lockdown, worries that insufficient attention has been paid to other considerations. “I am an epidemiologist and I worry that the response is based too much on epidemiology alone,” he says.

Stark conclusions Much of the concern stems from the weight placed by ministers on a report published on March 16 by a team of epidemiologists at Imperial College, London led by Neil Ferguson. Not only did this document warn that, unchecked, the virus could kill 510,000 people, it counselled that even with the government’s then preferred strategy of “mitigation”, more than 250,000 would die, with the National Health Service rapidly becoming wholly overwhelmed.

The stark conclusion did not come from Imperial redrawing its model. It was the result of inputting www.businessday.ng

data emerging from the progress of the pandemic in Italy, which showed among other things that far more patients than previously estimated required scarce intensive care beds.

Prof Ferguson is a big name in epidemiological modelling, with experience dating back to the footand-mouth crisis. The Imperial report sent a shockwave through the system in both the UK and the US, leading to the introduction of the present British policy of “social distancing” and suppression, with its heavy economic and social costs for the public.

Just three days beforehand, Sir Patrick had told the country that the aim was “to reduce the peak [of infection], not suppress it completely” and that policy was aimed at building “some kind of herd immunity”.

The impression that a mathematical model prompted a government volte face led to a torrent of critical attention on Prof Ferguson and his team.

Some scientists point out that the model was originally built for a different disease — influenza.

According to Mike Cates, a Cambridge university mathematics professor, “everyone’s conscious of the fact that it has been rapidly converted from a different purpose and wasn’t originally designed for this type of virus and this type of transmission”.

He is now leading a project sponsored by the Royal Society — the UK’s senior scientific academy — to create more diverse modelling groups.

Meanwhile, a rival group of academics at Oxford university released a paper seemingly contradicting the conclusions on likely fatalities drawn by Imperial. This was largely because it assumed the disease had been in circulation longer, and had therefore already infected a larger proportion of the British population without leading to substantial numbers of deaths.

Sage advice An ad hoc group, Sage, is assembled to meet specific crises. When it comes to infectious diseases, the group sifts data funnelled to it from three subcommittees. One, known as Nervtag, looks at the threat from emerging outbreaks. There is

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another specialising in modelling called SPI-M, and a behavioural group, or SPI-B. There is overlap between these bodies. For instance, Prof Ferguson sits on Nervtag, SPI-M and Sage itself.

One of the concerns about Sage is that it does not disclose its full membership. The explanation given is that it is a shifting cast of experts that moves depending on the task to be tackled. But anonymity makes it hard to know whether its deliberations could be dominated by any one scientific constituency.

Sir David worries that there could be a cost in terms of public confidence: “I simply cannot see the argument for not knowing who the members of Sage are.”

Sage members deny it is some sort of modeller’s clique. John Edmunds, a professor of infectious modelling at the London School of Hygiene and Tropical Medicine, who sits on the committee, as well as Nervtag and SPI-M, says it receives contributions from a number of disciplines from virologists to clinicians and behavioural scientists.

What seems clear though is that modelling moved up the agenda from late February when the rapid spread of the virus became apparent. That is when this sort of data became the main focus of attention.

“Until that point, we weren’t even asked to model the idea of a total lockdown,” says Prof Edmunds. “It was only when Italy started to look totally horrific that those sorts of policy options suddenly opened up.”

Concerns about the validity of models are not a new feature of public health crises. From their first live deployment in 2001 they have been contentious.

Used in 2001 to inform national rules about prophylactic culling in areas deemed at risk of footand-mouth, the models infuriated farmers in districts who believed their livestock was healthy. Michael Thrusfield, an expert in animal diseases, later claimed that Prof Ferguson’s modelling was “not fit for purpose” and led to the unnecessary deaths of animals.

While many authorities are more sympathetic to Prof Ferguson, the @Businessdayng

counterfactual is hard to prove.

There was a similar dispute after the 2009 swine flu outbreak when advice based on Imperial’s model was made public by ministers. This described a “reasonable worst-case scenario” in which there could be 65,000 deaths. In practise, there were only 457.

A later official report from Deirdre Hine, a Welsh physician and former chair of the Commission for Health Improvement, cleared everyone of overreacting, despite the consequent expenditure of £1.2bn on flu remedies that were not needed.

“When you have a chip pan fire in the kitchen and, because you have a fire blanket and a smoke alarm, damage to the kitchen is minimal and to the rest of the house is non-existent, you don’t thereafter throw out your insurance,” Dame Deirdre said.

She did, however, warn about Sage putting too much weight on the “academic scientific viewpoint — the modelling activity — to the exclusion of views from those involved in operational epidemiology”, such as public health experts and people in the clinical front line.

She also urged the government to make sure its response was flexible because future pandemics would not spread evenly but would be concentrated in certain “hotspots”.

This argued against a single response.

One scientist who believes the committee discarded Dame Deirdre’s advice not to “model watch” is Anthony Costello, a public health specialist at University College London. He claims that too little attention was paid to public health measures that could have softened the lockdown.

In particular he argues that identification of cases and contact tracing was abandoned too quickly in favour of the blunderbuss of social distancing. Not only has this shut down large parts of the economy, it leaves the UK prone to a recurrence of the disease whenever restrictions are lifted because so few may be immune.

“The lockdown was right in London and other places where it was clearly running out of control, but in other places you could have tried to contain it,” he says.

37

Thursday 16 April 2020

BUSINESS DAY

FT

NATIONAL NEWS

WeWork U-turn reignites SoftBank and Benchmark battle Two sides had to agree to tone down public criticism Miles Kruppa, Eric Platt , and Arash Massoudi

W

h e n We Wo rk was saved from bankruptcy last year, its oldest backers thought they had secured a route to profitably cash out of the troubled office-sharing group: selling their shares to SoftBank.

For months, Benchmark Capital had little reason to believe the Japanese group would walk away from part of a WeWork rescue package that would return multiples on the Silicon Valley venture firm’s eight-year-old bet on the company.

But that is exactly what happened this month when SoftBank dropped plans to buy up to $3bn in shares from its employees, existing investors and controversial co-founder Adam Neumann. The Japanese investor claimed multiple closing conditions had not been met, citing outstanding regulatory investigations, litigation and the pending closure of a Chinese joint venture.

The deal’s collapse has set the stage for months of legal battles between SoftBank and WeWork, following a lawsuit brought by two of WeWork’s most senior board directors, Benchmark’s Bruce Dunlevie and former Coach chief executive Lew Frankfort.

The lawsuit capped weeks of heated interactions with SoftBank executives including chief operating officer Marcelo Claure — who has been tasked with turning round the property company — as it became clear the deal was in trouble.

It has also revived old tensions between Benchmark and SoftBank from an earlier feud over the future of ride-hailing company Uber in 2017, an early touchstone for the kinds of battles that SoftBank, which this week warned of a $12.5bn annual operating loss in the face of coronavirus upheaval, has faced as it pours money into Silicon Valley companies.

The legal fight comes at a difficult moment for WeWork, which was already trying to revive its broken business model before the coronavirus pandemic ravaged the global economy.

On Tuesday, Mr Claure and the newly appointed WeWork chief executive Sandeep Mathrani are

Troubled times for, left to right, Masayoshi Son, Lew Frankfort and Bruce Dunlevie © FT montage; Bloomberg; Getty Images

expected to put on a brave face for an all-hands meeting where they will detail the state of the business and plans to repurpose tens of millions of square feet of office space.

But tensions have already spilled into public view. In late March, a statement from Mr Dunlevie and Mr Frankfort called SoftBank “unethical” for threatening to go back on the agreement, vowing to take “all necessary actions” to ensure the tender’s completion.

Soon after, the arguments became so heated that both sides came together and agreed to tone down their comments in public, according to people familiar with the discussions.

“More often than not, [investor disputes] are resolved informally within the board between the shareholders,” said Ilya Strebulaev, professor of finance at the Stanford Graduate School of Business. “In both cases, the corporate structures and the companies were unusual to start with,” he added, referring to the fights at Uber and WeWork.

WeWork’s special committee had viewed the share purchase as necessary compensation for the price cut investors stomached when SoftBank slashed the company’s valuation from $47bn to www.businessday.ng

$8bn following its failed initial public offering last year, people familiar with its thinking said.

The committee had also entertained a competing rescue package from JPMorgan, but the Wall Street giant refused to bankroll the $3bn tender or new loans SoftBank offered to Mr Neumann.

Meanwhile, people close to SoftBank questioned the special committee’s motivation for attempting to push through the deal, noting that Benchmark intended to cash out about $350m of its stake in WeWork through the tender.

SoftBank’s chief legal officer Rob Townsend said this month it would have been “irresponsible” for the Japanese group to go forward with the offer, directly naming Benchmark as one of the main beneficiaries of the deal, alongside Mr Neumann.

“Read the [SoftBank] press release . . . and who it mentions by name,” said one adviser involved in the dispute between SoftBank and Benchmark. “It is unusual for firms to piss on each other in public.”

Benchmark, SoftBank and the WeWork special committee declined to comment. SoftBank has said it will “vigorously” defend itself against the lawsuit, calling it a “desperate and misguided attempt” to rewrite the tender

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agreement.

The battle at WeWork has revived memories of an earlier face-off at Uber after Benchmark moved to oust its chief executive Travis Kalanick.

At first, Benchmark opposed attempts by SoftBank to buy a multibillion-dollar stake in Uber, thinking that the Japanese group intended to support Mr Kalanick.

It told other Uber investors it would not sell its shares and voted against an initial SoftBank proposal seeking exclusive rights to a deal.

Eventually the two sides reconciled, with Benchmark agreeing to drop a lawsuit against Mr Kalanick and selling about $900m worth of shares to SoftBank and other investors.

But Bill Gurley, the Benchmark partner in charge of its Uber investment, has publicly criticised the Japanese investor and its massive $100bn Vision Fund, accusing it of using “capital as a weapon” in competitive markets such as ride hailing and food delivery.

“It’s one of the toughest things a board has ever had to analyse — any board in the history of business,” Mr Gurley said about SoftBank’s influence on new industries during a television appearance last year.

At WeWork, Benchmark and other investors had viewed the @Businessdayng

Japanese investor as one the biggest enablers of Mr Neumann’s growth-at-all-costs mentality and unpredictable antics. The tender offer had partly been aimed at removing Mr Neumann’s grip on WeWork, clearing up the company’s complex ownership structure.

Instead, SoftBank’s latest move has added to the anger brewing in Silicon Valley against the Japanese investor’s pattern of abandoning deals.

WeWork is pressing for the $3bn tender to go ahead as originally planned, arguing that SoftBank will be unable to prove that any material fines will emerge from investigations by the Securities and Exchange Commission and Department of Justice.

The company’s lawyers have filed for an expedited trial in front of Andre Bouchard, the chancellor of the Delaware Court of Chancery and an experienced hand in complex corporate disputes.

An expedited trial could wrap up the matter within four months, though the timing could also slip because of the coronavirus pandemic, one person briefed on the matter said.

The special committee and SoftBank could also come to a new agreement over the tender, which would require new antitrust approvals, people briefed on the matter said.

38

Thursday 16 April 2020

BUSINESS DAY

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Thursday 16 April 2020

BUSINESS DAY

39

Live @ The STOCK Exchanges Prices for Securities Traded as of Wednesday 15 April 2020 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 248,816.58 7.00 6.87 215 7,566,056 222,296.24 6.50 3.17 260 22,916,525 UNITED BANK FOR AFRICA PLC ZENITH BANK PLC 499,204.25 15.90 9.66 877 72,101,441 1,352 102,584,022 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 174,092.17 4.85 1.04 548 74,757,704 548 74,757,704 1,900 177,341,726 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 1,994,742.28 98.00 - 141 896,573 141 896,573 141 896,573 BUILDING MATERIALS DANGOTE CEMENT PLC 2,268,091.54 133.10 10.00 231 2,109,306 LAFARGE AFRICA PLC. 206,985.17 12.85 3.63 118 3,111,507 349 5,220,813 349 5,220,813 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 291,280.06 495.00 - 14 1,661 14 1,661 14 1,661 2,404 183,460,773 REAL ESTATE INVESTMENT TRUSTS (REITS) SFS REAL ESTATE INVESTMENT TRUST 1,386.00 69.30 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 1 35 UPDC REAL ESTATE INVESTMENT TRUST 8,271.64 3.10 -1.59 10 425,000 11 425,035 11 425,035 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 2 30 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 2 30 2 30 13 425,065 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 52,512.75 55.05 - 13 17,540 OKOMU OIL PALM PLC. PRESCO PLC 36,450.00 36.45 - 5 2,076 18 19,616 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,500.00 4.25 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 2,100.00 0.70 - 6 123,500 6 123,500 24 143,116 DIVERSIFIED INDUSTRIES JOHN HOLT PLC. 217.92 0.56 - 0 0 S C O A NIG. PLC. 1,903.99 2.93 - 0 0 29,673.03 0.73 8.96 48 8,476,404 TRANSNATIONAL CORPORATION OF NIGERIA PLC U A C N PLC. 21,033.47 7.30 2.82 48 1,350,544 96 9,826,948 96 9,826,948 BUILDING CONSTRUCTION ARBICO PLC. 381.65 2.57 -9.82 1 125,000 1 125,000 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 30,360.00 23.00 2.22 95 3,097,819 ROADS NIG PLC. 165.00 6.60 - 0 0 95 3,097,819 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,234.62 0.86 - 2 23,897 2 23,897 98 3,246,716 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 6,889.96 0.88 10.00 16 362,812 GOLDEN GUINEA BREW. PLC. 829.98 0.81 - 0 0 GUINNESS NIG PLC 49,283.61 22.50 -0.88 73 1,424,675 INTERNATIONAL BREWERIES PLC. 134,310.34 5.00 - 63 1,764,244 NIGERIAN BREW. PLC. 214,316.97 26.80 9.84 20 301,718 172 3,853,449 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 152,400.00 12.70 8.55 81 1,779,032 FLOUR MILLS NIG. PLC. 88,158.16 21.50 - 11 32,968 HONEYWELL FLOUR MILL PLC 7,454.39 0.94 -4.08 18 819,144 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 22,520.23 8.50 - 3 4,808 UNION DICON SALT PLC. 2,993.06 10.95 - 0 0 113 2,635,952 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 13,147.41 7.00 - 41 572,729 NESTLE NIGERIA PLC. 658,063.22 830.20 - 121 105,575 162 678,304 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 5,316.09 4.25 - 16 156,961 16 156,961 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 15,881.91 4.00 - 35 450,814 UNILEVER NIGERIA PLC. 63,195.06 11.00 4.76 78 1,778,712 113 2,229,526 576 9,554,192 BANKING ECOBANK TRANSNATIONAL INCORPORATED 91,747.76 5.00 3.09 65 1,554,750 FIDELITY BANK PLC 61,426.57 2.12 -0.47 128 18,294,169 GUARANTY TRUST BANK PLC. 644,542.83 21.90 7.09 580 36,769,275 JAIZ BANK PLC 15,321.41 0.52 1.96 15 975,553 STERLING BANK PLC. 43,185.63 1.50 -1.32 33 1,582,150 UNION BANK NIG.PLC. 180,548.67 6.20 -4.62 38 611,441 UNITY BANK PLC 5,727.78 0.49 8.89 17 1,753,813 WEMA BANK PLC. 21,601.70 0.56 -9.68 34 3,633,604 910 65,174,755 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 1 100,000 AIICO INSURANCE PLC. 9,064.16 0.80 -4.76 19 2,452,500 AXAMANSARD INSURANCE PLC 16,590.00 1.58 - 0 0 CONSOLIDATED HALLMARK INSURANCE PLC 2,439.00 0.30 - 0 0 CORNERSTONE INSURANCE PLC 7,953.93 0.54 - 1 50,000 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 1,684.39 0.23 4.55 5 1,542,144 LAW UNION AND ROCK INS. PLC. 4,210.40 0.98 - 11 641,000 LINKAGE ASSURANCE PLC 3,680.00 0.46 - 6 270,000 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 1 19,000 NEM INSURANCE PLC 10,561.01 2.00 - 4 64,312 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,960.40 0.55 - 0 0 REGENCY ASSURANCE PLC 1,333.75 0.20 - 2 102,000 SOVEREIGN TRUST INSURANCE PLC 2,272.89 0.20 - 2 200,021 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 6,477.75 0.27 - 20 865,741 72 6,306,718 MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,629.63 1.15 - 2 88,200 2 88,200

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MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 6,784.62 1.05 - 0 0 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,671.82 1.36 - 0 0 RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 2,949.22 3.02 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 7,000.00 3.50 1.45 58 2,850,433 CUSTODIAN INVESTMENT PLC 33,820.72 5.75 - 8 360,900 DEAP CAPITAL MANAGEMENT & TRUST PLC 495.00 0.33 - 0 0 FCMB GROUP PLC. 33,664.61 1.70 7.59 139 19,175,885 ROYAL EXCHANGE PLC. 1,029.07 0.20 - 1 52,051 STANBIC IBTC HOLDINGS PLC 300,442.07 28.60 0.35 62 570,605 UNITED CAPITAL PLC 13,800.00 2.30 -1.29 163 9,180,500 431 32,190,374 1,415 103,760,047 HEALTHCARE PROVIDERS EKOCORP PLC. 2,991.61 6.00 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 1,030.41 0.29 - 5 370,000 5 370,000 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 593.50 0.60 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 5,299.36 2.54 - 8 58,104 GLAXO SMITHKLINE CONSUMER NIG. PLC. 6,278.35 5.25 5.00 38 1,051,297 MAY & BAKER NIGERIA PLC. 4,123.31 2.39 3.91 28 723,287 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 1,044.54 0.55 10.00 14 788,575 NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 88 2,621,263 93 2,991,263 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 710.40 0.20 - 3 20,335 3 20,335 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 911.95 0.31 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 216.00 2.00 - 0 0 TRIPPLE GEE AND COMPANY PLC. 287.07 0.58 - 0 0 0 0 PROCESSING SYSTEMS CHAMS PLC 1,080.09 0.23 - 8 426,191 E-TRANZACT INTERNATIONAL PLC 10,962.00 2.61 - 0 0 8 426,191 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,123,311.48 298.90 - 10 491 10 491 21 447,017 BUILDING MATERIALS BERGER PAINTS PLC 1,941.82 6.70 - 4 1,000 BUA CEMENT PLC 1,029,476.36 30.40 - 13 49,290 CAP PLC 16,240.00 23.20 - 6 1,344 MEYER PLC. 265.62 0.50 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 2.23 - 0 0 PREMIER PAINTS PLC. 1,156.20 9.40 - 0 0 23 51,634 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,192.12 2.03 - 0 0 CUTIX PLC. 2,113.59 1.20 -9.09 31 666,429 31 666,429 PACKAGING/CONTAINERS BETA GLASS PLC. 34,998.04 70.00 - 1 60 GREIF NIGERIA PLC 388.02 9.10 - 0 0 1 60 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 55 718,123 CHEMICALS B.O.C. GASES PLC. 1,519.29 3.65 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 77.00 0.35 - 0 0 0 0 0 0 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 3 18,000 3 18,000 INTEGRATED OIL AND GAS SERVICES OANDO PLC 36,051.10 2.90 9.85 99 5,244,498 99 5,244,498 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 58,019.78 160.90 - 12 3,128 ARDOVA PLC 14,587.79 11.20 0.89 74 964,572 CONOIL PLC 10,027.61 14.45 - 14 110,229 3,116.91 2.39 - 7 84,220 ETERNA PLC. MRS OIL NIGERIA PLC. 4,206.05 13.80 - 1 350 TOTAL NIGERIA PLC. 32,695.95 96.30 - 38 118,500 146 1,280,999 248 6,543,497 ADVERTISING AFROMEDIA PLC 1,509.28 0.34 - 1 1 1 1 AIRLINES MEDVIEW AIRLINE PLC 15,796.05 1.62 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 235.27 0.20 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,686.42 2.90 6.23 53 2,387,770 TRANS-NATIONWIDE EXPRESS PLC. 421.96 0.90 - 0 0 53 2,387,770 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,259.15 2.75 - 0 0 IKEJA HOTEL PLC 2,224.31 1.07 8.08 5 163,786 TOURIST COMPANY OF NIGERIA PLC. 7,076.28 3.15 - 0 0 TRANSCORP HOTELS PLC 30,401.62 4.00 - 0 0 5 163,786 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 3,960.00 0.33 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 187.49 0.31 - 0 0 LEARN AFRICA PLC 694.31 0.90 - 4 17,648 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 422.78 0.98 -1.01 3 501,272 7 518,920 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 580.20 0.35 - 2 100 2 100 SPECIALTY INTERLINKED TECHNOLOGIES PLC 688.80 2.91 - 0 0 SECURE ELECTRONIC TECHNOLOGY PLC 1,126.31 0.20 - 0 0

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Insight

BUSINESS DAY Thursday 16 April 2020 www.businessday.ng

COVID-19 & National Content Imperative CHUKWUMA HENRY OKOLO

G

ood things and more importantly, good lessons could come out of bad situations like the COVID-19 pandemic.

Nigeria has abundant resources, material, human and otherwise, which has remained largely underdeveloped.

One of the major lessons we are learning from COVID-19 is that in crisis situations every nation will seek to protect its interest first. The Indians put a freeze on chloroquine export to meet domestic requirement when there were indications that the drug could be a cure for COVID-19. China, US, Germany etc. all froze the export of personal protection equipment, ventilators etc. until they have met their domestic requirements.

Airports were shut down and foreign hospitals were no longer available to Nigeria’s elite Wherever you are in Nigeria at lockdown is where you can access medical facilities.

The Message is Simple: NATIONAL CONTENT DEVELOPMENT ACROSS ALL STRATEGIC INDUSTRIES AND SERVICES IS NOW AN URGENT NATIONAL SECURITY IMPERATIVE. The Oil & Gas Industry and more recently the National Electricity Regulation Commission are making some progress in Nigerian Content development in their respective sectors.

In addition to progress already made in Oil & Gas and Power, we have opportunities for National Capability development across a broad range of Industrial and Service areas, Medical and Health Care, Education and Human Capital Development, Engineering and Equipment manufacture, Power, Telecommunication, Defence Industries.

During 2019, the Federal Government through Presidential Executive Order No. 3, gave some policy support for Local Content Development. This is a commendable effort. We now need a comprehensive National Strategy and Policy Support for the accelerated development of Nigeria/s capability in strategic product and services. COVID-19 is a clarion call. There could be another COVID-19 or worse situation in the not too distant future.

In medical and health services area, we need a new generation of well-equipped and manned hospitals, more robust pharmaceutical manufacturing capacity, diagnostic facilities, well trained personnel, etc.

The resources of our educational institutions should focus on developing competent manpower in strategic areas – Medical sciences, Engineering and Technology, Agricultural sciences, ICT, applied sciences etc.

NERC should push for the accelerated implementation of the Regulations and Schedules for National Content implementation in the Power Sector.

With the progress already made in the Oil & Gas Industry, the next level national content will be to create full Nigerian Capability for the Oil & Gas Industry. Key focus areas will be the development of world class manpower capability and fabrication and manufacturing infra-

structure for Nigeria and Export.

Nigeria’s oil and gas infrastructure should be able to operate 100% with Nigerian personnel should situation demand.

NITDA and NCC should develop a framework for National capability in manufacturing, human capital and services for the Information and Communication Technology (ICT) Sector.

Nigeria consumes over US$10 billion worth of ICT Products and Services, over 90% of which are imported.

In the Defence Industry, it is now time for collaboration between the Federal Government and Private Sector to build Nigeria’s capability in manufacturing a broad range of Military hardware and logistics support equipment. Most of today’s military equipment are manufactured and assembled at SME levels in Eastern Europe and Asia. It’s not rocket science, it only requires national determination.

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The resources of our educational institutions should focus on developing competent manpower in strategic areas – Medical sciences, Engineering and Technology, Agricultural sciences, ICT, applied sciences etc

National Content Development across industries and service area have economic, social and security benefits; employment creation, GDP Growth, increasing foreign exchange reserves (through import substitution and exports), technology acquisition etc.

There are challenges to building national capability in key areas but these are surmountable.

Capacity building in country, financing, infrastructure, overcoming the commission agents and rent seeking syndrome, international geo-politics and covenants in foreign loan agreements are some of these challenges. Some Middle East countries do not have a fraction of Nigeria’s human capital resources.

However, they have established world class manufacturing and service capabilities leveraging global human resources and technology. UAE, Qatar, Saudi Arabia are outstanding examples.

Countries all over the world have pursued policies that seek to promote national competitiveness, socio economic and security interest. The COVID-19 phenomenon should be a clarion call for the development and implementation of Nigerian content in a range of strategic industries and services.

The Federal Government should embrace national content development as policy tool and major response to

COVID-19. Strategic areas will include; medical and related services, engineering and manufacturing, agricultural processing, modernized education, power, telecom, construction, etc. The key role of Government should be policy and stimulation while the Private Sector will drive the investment and management.

Comprehensive range of fiscal and monetary policies to support accelerated expansion and creation of new capacity in targeted strategic industries and service sectors should be issued urgently.

The Central Bank of Nigeria (CBN) initiatives in intervention and stimulation funds is commendable. A desirable Nigeria’s COVID-19 will response to be for CBN to launch a bold National Content fund of at least US$ 5billion to accelerate the development of Nigeria’s capability in the areas identified within the next three to five years.

Nigeria has the capacity to build world class manufacturing and services capability. Let COVID-19 be a positive stimulus for the development and implementation of Nigerian Content Policy across all critical sectors.

We pray that Mr. President declares a NATIONAL SECURITY EMERGENCY ON NIGERIA CONTENT DEVELOPMENT IN ALL CRITICAL SECTORS • CHUKWUMA HENRY OKOLO Writes from Lagos

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.