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Off-grid solutions attract $410m in new investments … World Bank, All On, USADF, AfDB lead pack of investors ISAAC ANYAOGU

L-R: C.D. Glin, president/CEO, United States African Development Foundation (USADF); Wiebe Boer, CEO, All On; Damilola Ogunbiyi, MD, Rural Electrification Agency; Ed Ubong, MD, Shell Nigeria Gas; Ujunwa Ojemeni, investment associate, All On, and Jack Leslie, chairman, USADF, during the 2018 USADF/All On Nigeria Off Grid Energy Summit held in Lagos, yesterday.

Businesses unsetlled by FIRS tax drive Multinationals panic over FIRS’ ‘arbitrary’ demand

Iheanyi Nwachukwu

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he business community in the country has become unsettled by the bullish and ‘unorthodox’ approach being adopted by the Federal Inland Revenue Service (FIRS) to boost tax revenues.

In a letter seen by BusinessDay yesterday and addressed to a commercial bank, the FIRS

demanded that the commercial bank compulsorily transfer funds from a company’s account to the FIRS. “I wish to inform you of the failure of XXX Limited to comply with various provisions of the tax laws by not paying Company Income Tax (CIT) amounting to N110,000,000.00 (One Hundred and Ten Million Naira) Only to the Federal Inland Revenue Service.”

The FIRS, in the letter, went ahead to appoint the commercial bank as a “Collecting agent for the full recovery of the aforesaid tax debt of N110 million.”

The FIRS then directed the commercial bank to “to set aside the aforesaid sum (N110 million) and pay same to the credit of XXX Limited in full or partial amortization of its aforesaid tax debt.”

The FIRS demanded that the

alleged tax owed by the company should be debited before any transaction is done on the account and also demanded that “detailed bank statements and Financial records for XXX Limited and any of its subsidiaries,” holding accounts with the commercial bank should be forwarded to the FIRS ‘in a sealed envelope’ within “72 hours of the Continues on page 42

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nvestors are putting money behind off grid solutions to the country’s power challenge. An estimated $410million (N25bn) worth of funding has gone into the Nigerian off grid space this year, BusinessDay calculations show.

Analysts say this shows that the off grid market in the country is coming of age as innovative businesses are getting access to critical capital, technical and Continues on page 42

Inside Tough questions await Nigeria as it faces investors for $2.8bn Eurobond P. 2 Atiku tipped to emerge as candidate for coalition of 40 political parties P. 42

2 BUSINESS DAY NEWS

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Tough questions await Nigeria as it faces investors for $2.8bn Eurobond LOLADE AKINMURELE, Lagos; ONYINYE NWACHUKWU, TONY AILEMEN & OWEDE AGBAJILEKE, Abuja

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hether it is why external reserves have failed to reflect the renewed rally in oil prices or the ongoing dispute with its biggest nonoil foreign investor MTN, Nigerian officials will face tough questions from investors during a road show to raise $2.8bn this year.

The Federal Executive Council (FEC) has approved six transaction parties to advise it on the issuance of $2.868 billion in Eurobonds, the bulk of which will go to funding the deficit portion of the N9.1 trillion 2018 budget.

The FEC approved the appointment of Citigroup Global Market Limited, Standard Chartered Bank as joint manager; FSDH Merchant Bank Limited as financial adviser; White and Case LLP, Banwo and Ighodalo as legal advisers and Africa Practice Limited as technical adviser on communication.

In August, Citi Group and Standard Chartered were two of the four banks found guilty by the central bank of Nigeria of aiding an illegal repatriation of $8.1 billion on behalf of telecommunication firm, MTN Nigeria, over an 8-year period to 2015, and were slapped with a N5.9 billion naira fine ($16 million).

The matter is in court, after MTN denied any wrongdoings. The four banks, which also included Standard bank’s Nigerian unit, Stanbic IBTC and Diamond Bank, had also denied any wrongdoings but were fined anyway, with their accounts debited by the central bank.

“The country has quickly erased the ugly MTN situation from their minds and turned to two of the same banks that came under their hammer only two months ago,” one investment banker said.

“Investors will be very interested in how that is developing,” the person said.

Zainab Ahmed, minister of finance said that the transaction parties are expected to advise the Nigerian Government on “the structure and timing, as well as, documentation for the issuance” of the Eurobonds and other securities.

The six advisors are to be paid a total fee of US$374.8m, the new Finance Minister, Zainab Ahmed said.

The $2.8bn Eurobond will be issued before the end of the year to fund the 2018 budget whose implementation is yet to commence, an official of the Debt Management Office (DMO) confirmed to BusinessDay. “In its commitment to the implementation of the 2018 Appropriation Act, the Federal Executive Council at its meeting today October 17, 2018 approved the appointment of Transaction Parties who will serve as Advisers to the Federal Government of Nigeria for the Issuance of Eurobonds or other securities in the International Capital Market (ICM),” the DMO noted in mailed statement following Federal Executive Council (FEC) approval at their Wednesday meeting in Abuja.

Patience Oniha, Director General, DMO had signaled earlier in the year that the debt office would tap capital markets and concessionary loans from the World Bank and would also consider other funding options for the 2018 budget.

The 2018 Appropriation Act which was approved in June 2018, includes a provision of N849.673 billion (about USDD2.78 billion) for new External Borrowing to part

finance the deficit in the Budget.

In November 2017, Nigeria successfully raised $3 billion - its largest Eurobond issuance in a 2-part international bond sale, mostly to fund the 2017 budget, while the rest was used to refinance maturing localcurrency bonds.

The first part had a yield of 6.5 percent for a 10-year tranche, while the second part, which is for longer notes, had a yield 7.625 percent for a 30-year period.

Nigeria also raised $2.5 billion in Eurobonds last February when it sold a 12-year note at 7.1 percent to raise $1.25 billion and a 20-year tranche at 7.7 percent.

“Consistent with the Government’s policy on development of infrastructure, the proceeds of the Eurobond Issuance will be deployed to fund critical capital projects in the 2018 Appropriation Act,” the DMO stated.

The approval by the FEC also happened simultaneously with an approval by Senate for two foreign loan requests totaling $2.868 billion by the President.

The approval followed the adoption of a report by the Senate Committee on Local and Foreign Debts at the plenary on Wednesday.

But this new bond issuance is expected to come at a higher cost than previous ones.

The yield on the Eurobond issued in February 2018 has climbed to 8.5 percent (as at October 17) from 7.625 percent at issuance, which hints at what it may cost to raise fresh debt.

“It would be more expensive that the last offer especially with the rising interest rates in the United States,” said Tajudeen Ibrahim, head of research at investment bank, Chapel Hill Denham.

“However, the issue may be oversubscribed given investor appetite for high yields and the rally in oil prices,” Ibrahim added.

Oil prices have crossed the $80 per barrel mark in October, trading at $83 Wednesday, according to Bloomberg data.

The rise has not been reflected in the central bank’s external reserves, which has slipped to $42.9 billion as Oct. 16, from $44 billion at the start of the month.

That’s because the CBN has upped its interventions in the foreign exchange market to compensate for foreign portfolio outflows from the country ahead of elections in 2019 and a broader emerging market sell-off.

Godwin Emefiele said at the last Monetary Policy Committee meeting that he was determined to keep the exchange rate stable at the expense of the external reserves.

The new external borrowing will take the country’s total external debt stock to $24.9 billion from the current $22.16 billion, 6 percent of the GDP of Africa’s largest economy.

The government in 2017 borrowed N1.2 trillion from the international capital markets and borrowed the balance of N1.3 trillion from the domestic capital markets. However, it left another N1.3 trillion of the total deficit unfunded.

The new issuance will be Nigeria’s fifth in the last two years, despite concerns that debt service to revenue ratios is already hitting unsustainable levels.

While the country’s low debt to GDP ratio suggests there is still room for more borrowing, it is its debt service as a percentage of revenue that has drawn widespread concerns.

•Continues online at www.businessdayonline.com

L-R: Peter Obi, vice presidential candidate of the People’s Democratic Party (PDP), representing former vice president of Nigeria, and PDP presidential candidate, Atiku Abubakar; Okezie Ikpeazu, governor, Abia State, and Enyinnaya Abaribe, senator, during Obi’s condolence visit to Abia State over a recent fatal pipeline explosion in the state.

Lagos still looking for investors to take on Okokomaiko-Badagry road ... to resume fixing of collapsed portions JOSHUA BASSEY

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nvestors look uninterested to stake their funds in the development and upgrade of the Okokomaiko-Badagry Expressway, sections of which have long collapsed resulting in daily gridlock and heavy economic losses to commuters and businesses along the axis.

The Federal Road Safety Commission (FRSC) recently described the international route as ‘death trap’ and called for an urgent action to save lives and property going through it.

The Lagos State government confirmed on Wednesday it was yet to secure investors’ buy-in to continue the expansion of the road via a Public Private Partnership (PPP) arrangement in spite of several trips overseas and overtures to both local and international investors.

Ade Akinsanya, the Lagos State commissioner for works and infrastructure in a statement seen by BusinessDay,said:“LagosStategovernment has maintained the road regularly in the last three and a half years through rehabilitation, but discussions with investors willing to upgrade the road under the Private -Public-Partnership (PPP) deal is still going on at both the state and federal levels.”

Akinsanya further confirmed

that discussions on the road topped the agenda “between Governor Akinwunmi Ambode and Chinese investors during President Muhammadu Buhari’s recent trip to China.”

Checks by BusinessDay showed that the last couple of months, commuters and motorists have had to spend hours on the international road which links Nigeria with other West African countries like Benin, Ghana and Côte d’Ivoire among others.

The state government first awarded contract for the expansion of the expressway from four to ten lanes, in 2009 to Julius Berger Plc, starting from the Eric Moore end, near Iganmu (Lot 1).

It subsequently awarded the Lot 2, Mile 2-Okokomaiko to CCECC, a Chinese engineering and construction company. But ten years after the work begun, there seems to be no end in sight.

The government had put up the last phase of the road (OkokomaikoBadagry) for uptake by private investors who will recoup its investment by tolling the road.

Residents, commuters and motorists took the streets on Tuesday to protest the deplorable condition of the road. But in a statement issued by the state government on Wednesday the state said: “Although the Federal Government manages the inter-national route, Lagos State government prom-

ised to keep its maintenance workers and equipment on the road until commuters and other users are relieved of the stress caused by the bad portions”.

“So far, the Lagos State Public Works Corporation (LSPWC) has carried out palliative works at Iyana Era, Ijanikin, Oko-afo, Magbon, Ibereko, Araromi, Iyana Isashi and Agbara”, Akinsanya said, adding that the government has mobilised other contractors to ensure full coverage of the assignment.

He said in July, this year, Governor Ambode responded to the complaints of residents over challenge posed to traffic by directing that the completed segment of the road with the BRT Corridor from Eric Moore to Trade Fair be opened up to ease traffic.

To further alleviate the suffering of the motoring public in the Badagry division, the commissioner said the present administration has completed the construction of AradagunIworo-Ajido road and Ajara- AgelasoPoka/ Erekiti with bridge.

He said the government was also building the Aradagun-Imeke-AjidoEpeme road, Samuel –Ekundayo/ Toga and will soon embark on the construction of Abule Ado road.

Akinsanya assured that there would be adequate security on the road to ensure smooth traffic and protect residents from danger.

Senate asks CBN to suspend card maintenance charges OWEDE AGBAJILEKE, Abuja

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he Senate on Wednesday charged the Central Bank of Nigeria (CBN) to suspend the card maintenance charges deducted from the bank accounts of customers.

It also mandated commercial banks operating in the country to configure their machines to dispense up to N40,000 per withdrawal instead of the current limit of N10,000 pending the outcome of the investigation by the committees tasked with investigating excessive and illicit bank charges in the country.

Also, the upper legislative chamber mandated its Committees on Banking, Insurance and other Finan-

cial Institutions as well as Finance to invite the Governor of Central Bank of Nigeria, Godwin Emefiele to explain why the official charges are skewed in favour of the banking institutions as against ordinary bank customers.

It also directed the committees to conduct an investigation into the propriety of card maintenance charges in comparison with international best practices. This followed a motion moved by Gbenga Ashafa (APC, Lagos State) at Wednesday plenary.

Nigerian banks charge their customers N50 monthly as card maintenancefee,evenastheN10,000perwithdrawal limit, attracts further charges.

Inhismotiontitled,“IllicitandExcessive charges by Nigerian Banks on Customers Account with Particular Focus

on Automated Teller Machine (ATM) MaintenanceandWithdrawalCharges” Ashafa accused the apex bank of being insensitivetotheplightofNigerianswho are already complaining of excessive charges by commercial banks.

He expressed concern that there have been several complaints from Nigerians generally and on social media concerning Illicit and excessive charges being deducted by Nigerian CommercialBanksandcitedexamples such as the campaign tagged #Reform9jabanks led by a UK Based Nigerian Medical Doctor, Harvey Olufunmilayo who lamented about the state of Banks in Nigeria compared to those abroad.

•Continues online at www.businessdayonline.com

Thursday 18 October 2018

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LBS, Fine & Country out to build leaders for Africa’s real estate industry CHUKA UROKO

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s a proactive measure to produce people that will lead, engage and benefit from an industry that has steadily grown over the years and has more potential to grow further in the coming years, the Lagos Business School (LBS) and Fine & Country West Africa have come together in a collaborative effort to build leaders for the real estate industry in Africa.

LBS, also known as Pan African University, is one of the foremost business schools in Africa, while Fine & Country West Africa is one of Africa’s real estate leaders. Together, these two continental bodies are presenting a Real Estate Executive Leadership & Business Programme for real estate developers, investors, financiers, agents, managers and enthusiasts.

This initiative is also a response to the realisation that in a constantly changing and fast-moving industry like real estate, especially where entry barrier is very low, it is essential for practitioners, managers, stakeholders and investors to stand out, bearing in mind that one of the primary elements that ensures differentiation and superior results is superior knowledge and expertise.

A 2018 PWC report on Real Estate 2020, which is a global prediction on real estate spanning 2016-2020, titled ‘Building the future,’ anticipates a rapid growth that will find real estate at the centre benefiting from the socio-economic change that will emerge.

“Looking forward to 2020 and beyond, the real estate investment industry will find itself at the centre of rapid economic and social change, real estate investors, managers and participants will have a broader range of

opportunities, with greater risks and new value drivers,” the report says.

It continues, “by 2020, investable real estate will have grown by more than 55 percent compared to 2012,” meaning that professionals should be knowledgeable and ready to fill these opportunities.

To ensure that these opportunities don’t slip by, Udo Okonjo, CEO/vice chair, Fine & Country, assures “we are very eager to transfer some of our knowledge and experience in the prime real estate residential and commercial sector garnered over the past 10 years in the industry.”

She stresses that the real estate industry needs industry role models and leaders who are astute and have exemplary knowledge of pressing issues and are equipped to tackle the challenges and take advantage of the opportunities in the market.

Henrietta Onwuegbuzie, academic director at Lagos Business School, explains that the innovative concept by the school is targeted at anyone interested in gaining superior knowledge and garnering expert insights in the various value chains of the industry.

Among other benefits, the certificate course aims to position real estate businesses to take advantage of growth opportunities in the sector and position their business for success; explore strategies for enhancing customer value and unlocking new customer segments based on market insights provided.

It also aims to build networks and make new connections with leaders, professionals and businessmen in the sector; enable participants initiate, develop and support real estate projects that yield high return on investment, and to hear from experts on diverse ways.

Thursday 18 October 2018

How non-existing companies got money from $1.3bn Malabu deal DIPO OLADEHINDE

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imon Taylor, founding director at anti-corruption group Global Witness has made more shocking revelations about the ongoing trial of whether $1.1 billion of the sum paid in the controversial Malabu oil deal was siphoned in bribes to win the license to the field.

BusinessDay is following the ongoing trial through a series of tweets by Barnaby Pace, an oil campaigner for NGO, Global witness, who is in court monitoring the trial and tweeting about it.

According to Pace’s tweets, Taylor told judges on Wednesday, October 17, in a court sitting in the city of Milan, Italy, of how Global Witness investigations over the last 25 years showed corruption is the glue that binds the exploitation of natural resources, fuelling conflict, environmental and human rights abuses.

The founding director of the anti-corruption watchdog narrated to the court how letters from Nigeria’s Department for Petroleum Resources (DPR) said that the OPL 245 deal was not in the public interest.

Taylor explained how he first heard about Malabu and OPL 245 in 2002 when Africa Energy Intelligence reported on their connection to Dan

Etete. At the time another NGO called Publish What You Pay (PWYP) was being launched so there was an interest in looking into case studies of possible corrupt oil deals.

Taylor told the court how curiosity increased when Global Witness noticed that a very large sum of money being paid for a Nigerian state asset did not go to the government but into private pockets.

Taylor narrated how Shell’s answers to questions in conversations and letters asking about OPL 245 were very general and didn’t answer the specifics.

Taylor explained how in 2012 Global Witness emailed Eni after seeing court documents where a Russian middleman named Ednan Agaev, sued in New York for a payment he wanted from Malabu from the OPL 245 deal which he acted as an intermediary.

Taylor explained how Global Witness and another Italian NGO named Re:Common attended the Eni shareholders meeting to ask questions about the deal and whether they knew Etete had an interest in Malabu; Thereafter further questions were asked about a particular phone call between Eni’s Chief Execuive Officer, Claudio Descalzi and Luigi Bisignani.

Delta proposes N367bn budget estimates for 2019 fiscal year IDRIS UMAR MOMOH, Benin

D L-R: Kemi Ibiwoye, 2nd chairperson, Association of Professional Women Bankers of Nigeria (APWB); Mercy Oluwatoyin Ojo, chairperson; Funke Ladimeji, chief operating officer, FBNQuest/chairman of the dinner committee, and Tinuke Leye-Ishola, 1st chairperson, APWB/business development manager, Wema Bank, at a press conference to announce the Association of Professional Women Bankers of Nigeria 2018 annual dinner with the theme “Funding Infrastructure Development in an Emerging Economy” in Lagos, yesterday.

Pic by Olawale Amoo

Citigroup, Standard Chartered, FSDH are transaction parties for proposed $2.8bn Eurobond issue ONYINYE NWACHUKWU, TONY AILEMEN & OWEDE AGBAJILEKE

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igeria has appointed Citigroup Global Markets Limited and Standard Chartered Bank as Joint Lead Managers for the planned $2.9 billion Euro Bond that is about to be issued in the international capital market.

FSDH Merchant Bank Limited, a Nigerian bank, is appointed as the Financial Adviser; White & Case LLP and Banwo & Ighodalo, emerged as the legal advisers, while Africa Practice Limited will serve as the technical adviser on communication for the deal.

The six advisory contracts

were procured at the total cost of N374.8 million, the new Finance Minister, Zainab Ahmed said.

The $2.8bn Eurobond is billed to be issued before the end of the year to fund the 2018 budget whose implementation is yet to commence, an official of the Debt Management Office (DMO) confirmed to BusinessDay. “In its commitment to the implementation of the 2018 Appropriation Act, the Federal Executive Council at its meeting today October 17, 2018 approved the appointment of Transaction Parties who will serve as Advisers to the Federal Government of Nigeria for the Issuance of Eurobonds

or other securities in the International Capital Market (ICM),” the DMO noted in mailed statement following Federal Executive Council (FEC) approval at their Wednesday meeting in Abuja.

Patience Oniha, director-general, DMO had signalled earlier in the year that the debt office would tap capital markets and concessionary loans from the World Bank and would also consider funding options for the 2018 budget.

The 2018 Appropriation Act, which was approved in June 2018, includes a provision of N849.673 billion (about $2.78bn) for new External Borrowing to part

finance the deficit in the Budget. As is the practice for Securities Issuance in the ICM, the Transaction parties will advise Nigeria on the structure and timing, as well as, documentation for the Issuance.

In November 2017, Nigeria successfully raised $3 billion - its largest Eurobond issuance in a 2-part international bond sale, mostly to fund the 2017 budget, while the rest was used to refinance maturing local-currency bonds.

The first part will yield 6.5 percent for a 10 year tranche, while the second part, which is for longer notes, will yield 7.625 percent for a 30 year period.

elta State Governor Ifeanyi Okowa on Wednesday presented the 2019 budget estimates of N367,095,083,451 billion to the Delta State House of Assembly for consideration and approval.

The budget proposal tagged, “Budget of sustainable growth,” comprised of N157,096,029,253 billion for recurrent expenditure, representing 42.79 percent and N209,999,054,198 billion for capital expenditure, representing 57.21 percent.

Okowa, who presented the budget to the state legislators, said it would enable his administration consolidate on the successes and achievements of his administration.

He said the 2019 budget was higher than the 2018 with over N59 billion, saying the 2019 fiscal year budget would be financed through internally generated revenue, statutory allocation from the federation account and other capital receipts/miscellaneous.

The governor explained that the sum of N73.4 billion representing 20.77 percent was being projected from the internally generated revenue, which is higher than the 2018 approved estimates by N1.9 billion, representing 2.8 per-

cent, N217.8 billion from statutory allocation representing 61.5 percent, greater than the 2018 estimates by N39.8 billion, representing 22.3 percent. He also explained that the sum of N62.7 billion was expected from capital receipts/miscellaneous in the fiscal year, which is higher than the 2018 projection by N14 billion.

He said the proposed recurrent expenditure estimates of N157,096,029,253 billion was made up of personnel cost of N65,736,621,939 billion, representing 41.8 percent, and overhead costs of N55,243.,917,068 billion, representing 35.2 percent, while the sum of N36,115,490,246 billion, representing 23.0 percent was proposed for social benefits/consolidated revenue fund.

The governor said the N36,115,490,246 billion was made up of grants and contributions, gratuities, consolidated wages and loan repayment.

The governor, who gave the sectoral breakdown of the budget, said the sum of N2.9 billion was earmarked for the activities of the Ministry of Agriculture, N79.6 billion for road infrastructure, N3.9 billon for sports development, N1.6 billion for water sub-sector, N8.6 billion for health and N26.8 billion for education.

Thursday 18 October 2018

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6 BUSINESS DAY NEWS Better health scenario finds Nigerians gaining over 10 years in lifespan – study IFEOMA OKEKE

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new scientific study of forecasts and alternative scenarios for life expectancy and major causes of death in 2040 shows Nigerians are likely to experience at least a slight increase in lifespan. In contrast, one scenario finds the country could face lower life expectancies.

The rankings of nations’ life expectancies offer new insights into their health status.

According to the recent health forecasting study, Nigeria, with an average life expectancy of 65 years in 2016, ranked 156th among 195 nations. However, if recent health trends continue, it could rise to a rank of 123rd in 2040 with an average life expectancy of 74.8 years, an increase of 9.8 years.

Nigeria’s life expectancy could increase by as much as 14.2 years in a better health scenario or as little as 5.1 years in a worse health scenario.

In contrast, the US in 2016 ranked 43rd with an average

lifespan of 78.7 years. In 2040, life expectancy is forecast to increase only 1.1 years to 79.8, but dropping in rank to 64th.

China, on the other hand, had a lifespan of 76.3 years in 2016 and is expected to increase to 81.9, raising its rank from 68th to 39th in 2040.

In addition, the study, published Wednesday in the International Medical Journal ‘The Lancet,’ projects a significant increase in deaths from non-communicable diseases (NCDs), including diabetes, chronic obstructive pulmonary disease (COPD), chronic kidney disease, and lung cancer, as well as worsening health outcomes linked to obesity.

In 2016, the top 10 causes of premature death in Nigeria were malaria, diarrheal diseases, HIV/AIDS, neonatal encephalopathy due to birth asphyxia and trauma, lower respiratory infections, neonatal preterm birth complications, congenital birth defects, neonatal sepsis, meningitis, and protein-energy malnutrition.

Edo lauds 9-year jail term for human traffickers, backs special court for offence

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overnor Godwin Obaseki of Edo State has hailed the judgment of Justice Mohammed Liman of a Federal High Court in Benin City, who on Tuesday sentenced Christy Ehiorobo to nine years imprisonment for engaging in human trafficking.

Obaseki said the judgment was a triumph of good over evil, and assured that other traffickers would have their days in court soon.

The governor said: “I commend the courage of the High Court Judge for serving Mrs. Christy Ehiorobo, a nine-year jail term for engaging in human trafficking.

The judgement has given further bite to our resolve to rid Edo State of human traffickers who are exploiting our youth.”

He noted, “With the support we are receiving from critical stakeholders such as the judiciary, the Royal Palace of the Benin Monarch

and the legislature, in the fight against human trafficking, I am convinced that we will win the fight.”

The governor further said he had thrown his weight behind the decision of the Edo State Chief Judge, Justice Esohe Ikponmwen to dedicate two specialised courts to hear human trafficking cases.

“I have thrown my weight behind the decision of the Edo State Chief Judge, Justice Esohe Ikponmwen to designate two courts to hear human trafficking offences in order to give accelerated hearing to such cases. The decision of the chief judge is innovative as it will fast-track the dispensation of justice in human trafficking and related cases,” he said.

According to media reports, a Federal High Court, sitting in Benin City, on Tuesday, sentenced a 49-year-old woman, Christy Ehiorobo, to nine years imprisonment for human trafficking.

We don’t have $3.5bn subsidy fund - NNPC HARRISON EDEH

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he Nigerian National Petroleum Corporation (NNPC) has disclaimed the insinuation that it has in its custody $3.5 billion subsidy fund.

NNPC group general manager, group public affairs division, Ndu Ughamadu, explained that at the heat of the shortage of products supply at the close of last year, the National Assembly asked the NNPC to do everything possible to stem the hiccups.

Ughamadu said in statement on Wednesday that the NNPC initiated the move to raise a revolving fund of $1.05 billion, since the corporation was, and still was, the sole importer and supplier of white products in the country.

The corporation spokesperson said ever since, the fund had been domiciled in the Central Bank of Nigeria, saying at no time was it in the custody of the NNPC. Ughamadu said the fund, dubbed the National Fuel Support Fund.

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L-R: Moritz Abazie, chairman, Strides Group; Chioma Okpochi, manager, contract and procurement production, Shell Nigeria; Steve Ayiyi, managing director and chief executive officer, Steve Integrated, and Obiorah Chidozie, representing general manager, S and E, Shell Nigeria, after a panel session, during Shell Nigeria Content Day exhibition in Lagos, yesterday.

Minimum wage: Labour re-strategises as Fayemi cancels tuition fees, taxes in Ekiti schools Buhari in 2019, FG insists ‘no agreement on N30,000’ RAPHAEL ADEYANJU, Ado-Ekiti hammadu saying it was only the conJOSHUA BASSEY

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he organised labour is regrouping to discuss the way forward on the long expected national minimum wage increase following the insistence by the Federal Government that it was yet to reach an agreement with labour on N30,000 as new national minimum wage.

Labour has insisted it would not sign any agreement with the Federal Government on anything below N30,000, claiming this was the figure agreed by various stakeholders, including private sector and government representatives which formed the 30-man tripartite national minimum wage committee.

The committee wrapped up its sitting in Abuja last week and forwarded its recommendation to President Muhammadu Buhari.

Bobboi Kaigama, president, Trade Union Congress

of Nigeria (TUC), told BusinessDay on Wednesday that the three labour centres would be meeting on Thursday (today) to begin deliberations on the next line of action and the way forward on the issue.

Ayuba Wabba, president, Nigeria Labour Congress (NLC), also confirmed today’s meeting, saying it would enable labour take its final stand on the expected minimum wage.

“We are meeting on Thursday to discuss the way forward,” said Kaigama.

Asked whether a government representative would be invited to the meeting, Kaigama said, “No, it is basically labour meeting to take a position on the minimum wage.”

It would be recalled that Chris Ngige, minister of labour and employment, had said there was no agreement yet by the tripartite committee on the figure for the new national minimum wage. Ngige also said nego-

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arely 24 hours in office, Governor Kayode Fayemi of Ekiti State has cancelled the education tax introduced by his predecessor, Ayodele Fayose, in all primary and secondary schools across the state.

Fayemi made this declaration on Wednesday, during a thank you visit to Ekiti South and North senatorial district headquarters in Ido and Ikere, saying, “Education is now free up to the secondary cadre in Ekiti State. Our children would no longer pay tax in both public and private schools.”

Fayose had in 2015 introduced payment of education tax in all private and public schools across the state, whereby children at primary and secondary cadres were mandated to pay N500 and N1,000 per term, respectively.

The new governor had also appealed to Ekiti people to vote for President Mu-

tinuity of Buhari/Osinbajo government that could bring the realisation of all projects promised by the Federal Government for Ekiti.

He explained that he had executed the free education policy during his first time in office, saying, “When we were in government before 2010 and 2014, we ran free education until when the last administration came and said school children should pay tax.

“By the grace of God,

by December this year, we are also going to introduce school feeding from primary to Junior Secondary 3 as part of the benefits we will get from the federal government.”

On the 2019 elections, Fayemi said the only way the promised made by President Buhari to extend rail line to Ekiti, dualise AdoAkure road and do other projects is by allowing this government to continue beyond 2019.

Thursday 18 October 2018

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Tech solutions as key facilitator for Ease of Doing Business CYNTHIA IKWUETOGHU

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s technology continues to position itself as one of the key elements of every successful economy, it has become evident that an enabling environment based on the use of technology solutions enhances the ease of doing business.

This is according to a communiqué from a conference organised by Perchstone & Graeys in collaboration with Knowledge Resources Limited, titled, ‘Technology As A Catalyst (TAAC),’ signed by Osaro Eghobamien, managing partner, Perchstone & Graeys, in Lagos.

The conference revealed the accomplishments of the public sector in promoting e-governance and the issues impeding the ease of doing business in Nigeria.

More importantly, in the communiqué recommendations were made by participants including but not limited to: public and private sector collaboration, policy reforms and integration of agencies, all geared towards improving the ease of doing business in Nigeria.

On private sector partici-

pation and policy formulation, the players said both sectors needed to cooperate so as to attain an enabling environment for doing business.

“The achievement of the much enabling environment and ease of doing business in Nigeria will require a proactive collaboration between and private sector stakeholders,” Eghobamien stated in the communiqué.

This will drive the formulation of information and communication technology (ICT) policies and regulatory frameworks.

It also recommended that in other to encourage Foreign Direct Investment (FDI), the country needs a Critical Technology Infrastructure Protection Law geared towards the promotion of infrastructure development, security of technology assets, and incentivisation of technology deployment in Nigeria. The establishment of a specialised ICT Development Bank to provide funding for ICT stakeholders/ tech start-ups at low interest rates is also crucial to boost productivity in the industry, it added.

Thirdly, on Broadband Penetration/Right of Way (RoW), the current penetra-

tion rate of broadband stands at about 22 percent. Access to RoW remained a major challenge, which has hindered improved internet connectivity in Nigeria and hindered the drive for broadband revolution.

To this end, “collaboration between the Nigerian Communications Commission and the state governments is pertinent to release these obstacles relating to RoW,” it advised.

Also, there is need for data protection and e-commerce laws as the successful implementation of the aims of e-governance/e-commerce of any economy relies largely on the effective data management and data processing, as stated in the communiqué.

Other recommendations proffered by participants on the ease of doing business with technology as a facilitator includes: integration of government agencies; integration of operations of Ministries, Department and Agencies (MDA’s) as they are vital for service delivery.

Effective and Integrated E-governance as well as enforcement of local content laws and policies were also included for solutions for an enabling environment for doing business in Nigeria.

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FAO endorses 1st Agricultural Quality Excellence Awards TELIAT SULE & EMMANUEL EHIHI

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he Food and Agriculture Organisation of the United Nations (FAO) has endorsed the 1st Agricultural Quality Excellence Awards. FAO endorsement came when the Award Secretariat paid a courtesy call at the FAO Abuja office.

At the meeting, Heather Ronke Akanni, the senior special assistant to the minister of agriculture and rural development on Quality Control and the coordinator of the Agric Awards intimated the FAO officials of the ag-

Afrinvest report sets agenda for new government, CBN governor HOPE MOSES-ASHIKE

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he 2019 elections are seen to present the best chance to reset governance and build new growth levers that would put the economy on a path to prosperity.

The Nigerian economy has endured several challenges in the past three years, which derailed progress towards the objectives of strong economic growth and development.

In its 2018 banking sector report, Afrinvest Securities Limited believes that implementing structural reforms is key to building a strong and sustainable foundation for growth.

“Indeed, we posit that an annual double-digit growth, which is required for sustained employment creation and poverty eradication is not impossible if critical reforms are passed,” Ike Chioke, group managing director of Afrinvest, said.

As the tenure of the Central Bank of Nigeria (CBN) governor expires next year, although, he is entitled to a second term of five years, Afrinvest has set agenda for new CBN governors.

The firm emphasised the need for enthroning a truly flexible foreign exchange framework with alignment of forex rates in all market segments, which will be required to restore investor confidence and advance the course of inclusive and less jobless growth and development.

Overall, it says, optimal monetary policy framework - supportive of market systems as well as regulatory efficiency devoid of policy shocks or policy flip-flops or poor regulatory communication, will have to be deployed.

Afrinvest will on monday next week, present to the public, the 2018 edition of its Annual Nigeria Banking Sector Report in Abuja.

ric ministry’s plan to have the first excellence awards for agric and agro-allied entrepreneurs in the country and the collaboration of the global was needed for the successful hosting of the event.

“We are here to brief you of the plan of the Federal Ministry of Agriculture and Rural Development to organise the first awards for players in the agricultural value chain. The project is meant to encourage the adoption of the global best practices by players in the agric and agroallied sector, Akanni said.

While responding, Suffyan Koroma, the FAO rep-

resentative in Nigeria congratulated the organisers of the awards and said the FAO, why it would like to part of the awards, their involvement would be limited to the training of people in agribusiness.

“This is a laudable idea because it has the ability to enhance the quality of the output from the agricultural sector. In line with our commitment, FAO’s collaboration will be limited to the training of people in agribusiness in the country,” Koroma said.

He further emphasised that FAO Nigeria had the mandate to promote the prin-

ciples of responsible agricultural investments, which are hinged on seven principles.

The seven principles are to recognise the existing rights to land and associated natural resources; promote investments that do not jeopardise food security; ensure the processes relating to investment in agriculture are transparent, monitored and ensure accountability by all stakeholders; consultation with all those who are materially affected and agreements are recorded and enforced, and that investors ensure projects respect the rule of law, reflect industry

best practices, viable economically and result in durable shared value.

Others include the provisions that investments generate desirable social and distributional impacts which will not increase vulnerability; and that the environmental impact of projects are quantified, and measures taken to encourage sustainable resources use, while minimising the risks associated with agricultural practices.

The 1st Agricultural Quality Excellence Awards are the initiative of the Nigerian Association of Chambers of Commerce, Industry, Mines

and Agriculture (NACCIMA), and Vertical Inspirations Organisation in collaboration with the Federal Ministry of Agriculture and Rural Development.

The project had earlier been endorsed by the Bank of Agriculture (BoA), Federal Ministry of Industry, Trade and Investment; the Raw Materials Research and Development Council; the Bank of Industry; Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL); Nigerian Agricultural Insurance Corporation (NAIC), OLAM Nigeria and Ecologistics.

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A case for tax regularization of offshore assets

UCHE UWALEKE Uwaleke is a Professor of Finance & Capital market and the Chair of Banking and Finance Department at the Nasarawa State University Keffi

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n an apparent bid to broaden the tax base by bringing tax evaders into the tax net, the federal government through a new Executive Order (EO 008) has announced its readiness to implement an offshore assets disclosure programme known as the Voluntary Offshore Assets Regularization Scheme (VOARS). The Executive Order mandates eligible taxpayers who hold offshore assets and incomes to declare them voluntarily within 12 months and pay either a one-off levy of 35 percent on the total offshore assets or all outstanding taxes, penalties and interests after a forensic audit of their offshore assets. The advantages to taxpayers who “truthfully and voluntarily” comply with the conditions of the scheme include immunity from prosecution for tax offenses and offences related to offshore assets. At the same time, any defaulting taxpayer who fails to take advantage of this scheme “shall, at the expiration of the scheme, face investigation and enforcement procedures concerning the offshore assets anywhere in the world pursuant to

MUHAMMAD AJAH Ajah is an advocate of humanity, peace and good governance in Abuja. E-mail mobahawwah@yahoo.co.uk.

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ess than four months to the next general elections, I foresee some weapons, so dangerous, that may be utilized by the opposition to limit the victory changes of the ruling All Progressives Party (APC) in elections. I predict very tough elections; tough in the sense that every position in the elections will be keenly contested; tough in the sense that Nigerians will turn out en masse for the national event; and tough in the sense that winners should win neatly while losers should accept defeat with civic maturity.

I am writing this piece with the intention to, amongst others, admonish President Buhari as a leader I love and wish the very best, to do the needful and ensure that the effects of the hardship felt by the common man on the street – though the wailers of today are predominantly the rich – are mitigated before the end of the running year. The wailers cum the opposition have been doing everything possible to devalue Buhari’s status. They have been employing

information now readily available through automatic exchange of information between Nigeria and foreign countries.”

To be sure, Offshore Voluntary Disclosure Programme involving tax regularisation of assets held abroad is growing in popularity especially among countries facing revenue challenges. It is a form of tax amnesty which, according to the Financial Action Task Force (FATF), refers to “favourable tax treatment such as a full or partial reprieve from any tax, interest and penalties that would otherwise be due in relation to previously unreported (or incorrectly reported) taxable income, funds or assets”.

There is ample evidence to support the fact that many countries have implemented tax amnesty programmes with the objectives of improving tax compliance, enhancing government revenue and encouraging the disclosure of offshore assets through generous tax incentives and immunity from prosecution. According to a survey in 2015 by the Organization for Economic Cooperation and Development (OECD), out of 47 countries which had different kinds of tax amnesties, 13 implemented “special programmes” for offshore tax disclosure some of which included incentives to repatriate assets to the taxpayers’ home countries.

For example, South Africa introduced a tax amnesty programme in 2003 with the overarching objective of expanding the tax base through mandating disclosure of previously unreported foreign assets. A 2007 OECD report indicated that the amnesty was largely seen as a success not least because

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Overall, tax regularization of offshore assets is a window being offered by the government to allow previously non-compliant taxpayers to remedy their tax affairs under specified terms and is not in breach of any Double Taxation Agreement

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during the nine months period the amnesty programme lasted the total foreign assets disclosed amounted to €7.8 billion. In December 2014, the Italian Parliament passed law No.186/2014 on voluntary disclosure requirement as part of the broader strategy that the Italian government was using to crack down on tax evasion. Also, Australia launched its tax amnesty programme in 2014 tagged “Project Do It”, The programme provided an opportunity for taxpayers to correct their offshore tax affairs following which many high net worth individuals were reported to have disclosed billions of dollars in undeclared assets and income.

The case of Indonesia equally deserves mention. The country implemented a nine-month tax amnesty programme from June 2016 under a Tax Amnesty Law No.11 of 2016 which provided for the “elimination of payable taxes, which shall not be subject to any administra-

tive sanction or criminal sanction, by disclosing the assets and paying Redemption Money”. By the end of the programme in March 2017, the Jakarta Post reported that “the revenue targets from domestic and offshore disclosure set by the government were largely exceeded”. The conclusion from these countries’ experiences speaks to one fact: offshore tax amnesty programmes have boosted government revenue.

This is corroborated by Bonds and Loans 2017 study which showed that ‘’Argentina recovered almost USD 100 billion, Brazil about USD 16 billion and Indonesia USD 321 billion during their programmes in 2016’’.

Like everything else, tax amnesty programmes have flip sides and this must be borne in mind by the Federal Inland Revenue Service. A transitory increase in revenues from taxes on previously undisclosed assets should not be at the expense of long-term compliance. The OECD literature on successful tax amnesties for undisclosed overseas assets documents that if implemented on a regular basis, citizens may come to expect their governments to offer periodic tax amnesty programmes, potentially incentivizing tax evaders. By the same token, frequent tax amnesties could have the unintended effect of penalising regular taxpayers. A 1989 study by Uchitelle found that some of the tax amnesties have actually offered better returns on assets to tax evaders than to those who have regularly complied. The United States Internal Revenue Service for instance has implemented many tax amnesty programmes including the Offshore Voluntary Disclosure Programs of 2009, 2011, 2012 and

2014. To address the associated pitfalls, the terms of the shortterm programmes are made less generous by the US IRS each time thereby creating a sense of urgency for compliance on the part of taxpayers.

Overall, tax regularization of offshore assets is a window being offered by the government to allow previously non-compliant taxpayers to remedy their tax affairs under specified terms and is not in breach of any Double Taxation Agreement. To succeed, as advised by the OECD, it needs to “tread a fine line between encouraging non-compliant taxpayers to permanently improve their compliance and retaining the support and compliance of taxpayers who are already compliant”. In this regard, a strong enforcement mechanism will not only increase compliance uptake but also reassure faithful taxpayers of the government’s efforts to apprehend tax evaders.

Besides reducing fiscal deficit through improvement in revenue and tackling tax evasion, the VOARS, which is a complement of the earlier Voluntary Assets and Income Declaration Scheme (VAIDS) introduced in July 2017, will go a long way in curbing money laundering. Against the backdrop of the recent disclosure by the former South African President, Thabo Mbeki, that Africa’s annual loss through illicit financial flows (IFFs) has increased from USD50 billion in 2015 to over USD80 billion currently, the new Executive Order on VOARS which took effect from Monday October 8, 2018 is a welcome development.

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2019: What Buhari should do to win souls different means, some actually unthinkable of political maturity, to create disaffection between the Nigerian masses and their president. If I heard well, I am not too sure that any reasonable human being in the name of politics will buy up commodities and destroy them in an attempt to ensure scarcity and price hike, thus the whole blame is heaped on the government of the day. There are other unbelievable ways used to sabotage government efforts and inflict sufferings on the masses.

Yet, I am sure that Nigerian patriots are happy with his leadership style. They loved him greatly and voted him massively in 2015.

A lot still love him greatly and will vote him on February 16, 2019.

They will ensure his victory, God’s willing. The love Nigerians have for him is basically because of his personality. If independent candidacy for elections was popular in Nigeria, he could march that path and remain victorious. But he loves team work and his party members. He loves Nigerians.

That is why government is a large institute and being the head of his government, he is responsible for everything that happens though as a human being, he cannot be everywhere and he cannot know everything.

That is why he has appointed people of diverse socio-cultural, ethno-religious and psycho-political backgrounds and interests. All of his appointees are human beings with assorted bearings. He has made the best choices, according to his human knowledge and ability. Some, if not all the appointees, were recommended to him by some people he knows very well and trust. His trust on them is surely the basis upon which his assurances were that they recommended the best for the nation. To him, the nation should be first before personal interests. He has severally proclaimed that most of his appointees were not known to him before.

That is how it should be because it is impossible to know every Nigerian by face or by name. All Nigerians are stakeholders in the Nigeria developmental project, thus every Nigerian should be eligible to work for the country at any given capacity.

No doubt, his appointees are doing well within their human capacities. They can make mistakes.

But they should be very careful because some mistakes may cause harm to the citizens. In short, some of mistakes or intentional actions of some of his appointees have caused harm to the citizens. And some may have been too economical in briefing him on the reality as it relates to the Nigerian masses. It is in connection

to the sincerity of purpose of some of his appointees that the opposition picks holes in his government. This could be the fulcrum for the strength of the opposition as the 2019 general elections approach. Besides this solid cause, there are few other serious matters that Buhari should conquer to sustain and advance his personality amongst the citizenry.

It is a common thing that “artificial” fuel scarcity is witnessed every end of the year till few months after the new year. Next year is a year very strategic one in the life of Nigerians and any inflicted hardship on them from this angle will definitely have negative influence on APC’s chances in the forthcoming elections.

Buhari should ensure that enough refined products that will carter for the citizens without increase in the prices are in stock throughout the electioneering period. Local refineries should be prepared to complement any shortage and if need be, heads of those refineries should be warned or redeployed to forestall any sabotage and compromise. There must be no fuel scarcity or hike in the prices from now till, at least, after the general elections.

Buhari should put in place stringent measures that will dissuade money politics during the elections. It is a criminal act by the laws especially the INEC. But

the enforcement is the problem.

Politicians can pay whoever they like during campaigns but there must be no vote-buying during the election day. Nigerians can collect money from the politicians because the money actually belongs to the people. But they should vote with the conscience for the people of choice. It should not be by cohesion or inducement. To curtain this money politics, the EFCC and ICPC must fix their lens on political parties and politicians. To fight this political menace is a duty on all the citizenry, despite perceived hardship amongst the masses.

It is better to endure hunger to ensure the bright future of one’s children than to sell one’s future for as low as N500. The gullibility of the Nigerian public in relation to selling their mandate for paltry coins is a matter to worry. Because of the past experiences where votes hardly counted for the declared victorious, voters often thought it was a waste of time queuing to vote and wait for the vote counting and announcement of winners at the polling units.

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Against eco-colonialism

NNIMMO BASSEY Nnimmo Bassey is Director of Health of Mother Earth Foundation (HOMEF)

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olonialism is alive and well and manifests in expected and unexpected forms.

It started as a practice of taking political control of another country or territory, occupying it and exploiting it economically. The primary aim of colonisation was, and remains, the exploitation of resources and territories for the benefit of the colonizer. The basic impetus has always been economic and corporate entities remained firmly behind the colonial masks.

Today, most nations have obtained levels of political and flag independence. Economic independence is still a huge struggle with several factors often arising as impediments to its attainment. These include geopolitical power structures, social and cultural imperialism and institutional arrangements that ensure continued control and exploitation. This has been aided to a large extent by corporate capture and control of political levers across the globe.

Thus, colonialism is not only alive but has grown and metamorphosed into forms that sub-

vert the rising of a truly postcolonial state. This has partially happened because the colonised is content to take the place of the colonial master and to continue as a middle man for the old system rather than to overthrow it.

As Frantz Fanon noted in The Wretched of the Earth, “The national bourgeoisie will be quite content with the role of the Western bourgeoisie’s business agent, and it will play its part without any complexes in a most dignified manner... In its beginnings, the national bourgeoisie of the colonial country identifies itself with the decadence of the bourgeoisie of the West. We need not think that it is jumping ahead; it is in fact beginning at the end.

It is already senile before it has come to know the petulance, the fearlessness, or the will to succeed of youth.”

This state of affairs can also be described as coloniality – originally the state of relations in a colony but today being driven by persistent and undergirding reign of colonial mentality.

Our School of Ecology provides spaces for the interrogation of colonialism in the framework of the colonisation of nature. We look at the exploitation and commodification of nature in ways that subvert natural evolution and creates economic levers for the domination and control of species and planetary systems. The sessions look at the emergence of new technologies and production methods that ignore or outstrip existing regulatory frameworks and which are pushed willy-nilly without

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We call for total decolonisation of nature and for the global measures for the securing of justice and allocation of responsibilities for outlaws or neo-colonial lords

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regard to the current capacity of humankind to fully understand the intricacies and interdependences of the webs of life on planet earth.

The present School of Ecology is looking particularly at new forms of extreme forms of genetic engineering including synthetic biology and gene drives. We are also looking at geoengineering experimentation aimed at having humans and corporations literally assume control of the planetary thermostat.

We are conscious of critical voices that have called for the restriction of these experimentations to laboratories and for diligent precaution until the harms and goods of the proposed systems can be fully evaluated, understood and accepted.

A manifesto issued by over 110 civil society groups against geoengineering stated among other

things, “Geoengineering technologies may disrupt local and regional weather patterns and further imbalance the climate, with potentially catastrophic effects for some regions, including on water availability and food production. The adverse impacts and side effects could cause more regional and international conflicts.” The manifesto calls for, “respect and effective guarantees for the right of indigenous peoples and local communities to free, prior and informed consent for any geoengineering experiment or project that may impact their territories or human rights “Respect for peasant rights, lands and territories, acknowledging that their livelihoods, including indigenous peoples’ communities, forest dwellers, artisanal fishers and pastoralists, are a vital source of food for most of the world’s population; pave the way for food sovereignty; contribute to mitigating greenhouse gas emissions; and regenerate soils and ecosystems. Their lands are particularly vulnerable to being grabbed and exploited for geoengineering experiments and deployment, and their agriculture is threatened by the side effects.”

We join in the call for the maintenance of the moratorium on extreme genetic engineering as imposed by the Convention on Biological Diversity (CBD) as they threaten to wipe out species.

Extreme and even old fashion genetic engineering threaten our biodiversity, overall ecological health and our food sovereignty.

We also join the call for a ban of

all geoengineering experiments and deployment as they threaten our very lives. Geoengineering’s side effects will obviously be deflected to already vulnerable regions and territories and Africa will be among the worst hit as present computer models show.

Besides, geoengineering presents false solutions to the climate crises and will lock in polluting production systems that are driving the Earth towards catastrophic temperature rises as recently captured in the 15th special report of the Intergovernmental Panel on Climate Change (IIPC).

We call for total decolonisation of nature and for the global measures for the securing of justice and allocation of responsibilities for outlaws or neo-colonial lords.

Without strict responsibility, exploitation quickly spirals into the worst forms of imperialism, according to Kwame Nkrumah.

Nothing can be worse than irresponsible disruption of our life support systems.

Today we have seasoned and experienced instigators in the house. We also have eager and open-minded participants. Our target is the interrogation of our mindsets and objective realities.

We stand firmly against ecocolonialism. Where do you stand?

The school doors are open.

• Welcome words by Nnimmo Bassey, Director of the ecological think tank Health of Mother Earth Foundation at the School of Ecology on Eco-Colonialism held in Abuja on 16 October 2018

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Company core values: A vital ingredient for a strong brand

JUDE ADIGWE Adigwe is a certified Human Resource Management (HRM) professional and is the Human Resources and Administration Manager at Sharemind Lagos

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usiness Dictionary defines core values as “a principle that guides an organization’s internal conduct as well as its relationship with the external world…”

When certain values are regarded as core, it means they are non-negotiable – they would be upheld through thick and thin.

Succinctly, it implies that there would be penalties for violations regardless of status. Is this usually the case? For the better part, core values in many organizations are nothing but grandstanding and showboating. They are pseudo positioning statements. An attempt to manage impressions of diverse stakeholders especially those in the external domain.

While this practice holds sway,

it is paramount to emphasize the centrality of core values. The realization of a company’s mission and vision to a large extent are dependent on core values. The core values of a company shape its culture – business processes are not carried out in a vacuum rather they are carried out within a culture. This goes to say that the mission (the reason why the company exists) and the vision (the destination) are constrained by core values. There is no gainsaying that companies ought to reflect thoroughly and understand the options of values available to them before choosing those to regard as core. Core values are strategic in building a strong brand.

A brand holds different meanings for many people. Philip Kotler, author of Marketing Management, defines a brand as “a name, term, sign, symbol, or design or a combination of them, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of the competitor.” In simple terms, a brand is a source of identification and differentiation. Your brand sets you apart. More closely linked to the scope of Human Resource Management is Ashley Friedlein’s definition of a brand. Ashley Friedlein,

Founder and President of Econsultancy defines a brand as “the sum total of how someone perceives a particular organization…”

Branding, according to Ashley, “is all about shaping that perception”.

It is my considered opinion that a brand is that story which organizations write with their internal and external engagements that is true to them and consistent across time. Engagements with employees and clients should be same – that is integrity (being whole and not fractured or disconnected). A brand (a strong one) should be a harmony of words and actions.

Core values should not be merely written out, they should be lived out. Living out core values is critical for building strong brands.

To build a brand through core values would require constant communication, evaluations and rewards or sanctions. Communication means that the importance of these core values must be constantly emphasized (formally and informally) to management, staff and clients. Evaluation implies that core values will be mapped onto business processes. As stated earlier, the mission of a company is constrained by its core values which means that business activities are guided by core values.

Extending this will mean that core values should be assessed. Owing to the non-negotiable nature of

core values, companies would need to evaluate everyone (from CEO to the least employee in the organizational structure) on how they live out the company’s core values. To give meaning to evaluations, there is need for rewards or sanctions depending on the outcome of such evaluations. In line with the principle of operant conditioning, the consequences of behaviour increases or decreases the likelihood of a repeat that behaviour. That is, if one is found wanting on one or more core values and he or she is sanctioned, the likelihood of a repeat of that behaviour is reduced. Also, if one excels on one or more core values, a fitting reward would maintain or increase one’s performance in such areas.

When politics is played with core values, the strength of the company brand gradually erodes and depletes.

I would be remiss if I fail to mention that one of the guaranteed ways of destroying a brand is multiple and dissonant messages (i.e. a brand saying too many things that are conflicting).

If some people live out the core values and others do not, it is only a matter of time before that brand experiences a downward spin. Again, it is important to emphasize that when core values are downplayed or totally ignored by

companies, they lose sight of the big picture that organizations are not simply about people, jobs, work tools and profit-making, it is also about having a culture – culture is central to performance and its sustenance. Culture motivates or demotivates. Remember, core values is an integral part of organizational culture.

As mentioned earlier, engagements with employees and clients should be same. It is common knowledge that companies always want to impress clients because they keep them in business.

Sadly, they fail to see employees in that light too. Most times, they are oblivious of the fact that employees are not simply resources (needed to generate revenue), they are also brand ambassadors of their respective organizations.

The narratives they weave about their organisations strengthen or weaken their companies’ brands.

Managing the perceptions of existing and exiting employees is central to building a strong brand because if their narratives conflict with company adverts, it would call to question the integrity of the company. Being true to core values would help avert that because core values and double standards do not mix.

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Editorial PUBLISHER/CEO

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

Bashir Ibrahim Hassan

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

Thursday 18 October 2018

Executive Order 6: An illegal power grab

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n the guise of re-kitting and re-tooling to effectively tackle what the president and his team calls “corruption’s perilous counter-attack against the Nigerian State,” the president signed into law Executive Order No 6 of 2018 to address “the Preservation of Suspicious Assets Connected with Corruption and Other Relevant Offences.” According to the regime, in the interest of justice and the welfare of the Nigerian state, persons accused of crimes relating to corruption must be prevented from utilizing the proceeds and dissipating such assets suspected to be proceeds of corruption (or associated with corruption) pending final determination of any investigation or legal actions related to such assets or owners thereof.

In signing the new Executive Order, President Buhari declared: “I’m bound to restrict dealings in suspicious assets…to preserve same in accordance with the rule of law and with guarantee and safeguard of fundamental human rights.”

Significantly, EO6 confers on the Attorney-General of the Federation the “power to co-ordinate the implementation of this Order”. Security or enforcement agencies

named in the order are obliged to communicate the outcomes of their investigations to the Attorney-General so that he can “immediately commence or direct the commencement of appropriate process(es) either administratively or judicially as the case may be.”

Recently, the president gave the Attorney General and Minister of Justice the go ahead to implement the order and no fewer than 50 high-profile persons directly affected were immediately barred from leaving the country until the courts determine their cases.

In implementing the order, the administration claims legal validity. Justice Ijeoma Ojukwu of the Federal High Court, Abuja on Wednesday, October 10 ruled that the President has the powers to roll out Executive Order 6. The Constitution grants the President powers to issue executive orders to enable execution of its policies. There was a significant caveat. The Honourable Judge insisted that the AG must exercise the powers he wields courtesy of EO6 in line with the constitution. It means that the AG cannot order the seizure of any property without a court order.

Although EO6 derives its powers from the constitutional powers of the president, it goes beyond it by trying to force the matter of action on

corruption away from the jurisdiction of the courts to the executive. The list of persons affected and from the EO6 that specified cases and persons to whom it applies, they are all cases pending in the courts.

But we know where the president stands on this. At the recent conference of the Nigerian Bar Association, the president canvassed the case for going outside the law in pursuit of matters of national interest. But Nigerians and lawyers shot him down. The government cannot infringe on the rights of citizens under any guise or justification.

Right to personal liberty and ownership of property is one of the fundamental rights the 1999 Constitution grants citizens. Rights under Chapter 1V include the right to life, the right to dignity of human persons, right to acquire and own immovable property and the right to freedom of movement, among others.

Section 44 of Chapter 1V proclaims that “No moveable property or any interest in an immovable property shall be taken possession of compulsorily and no right over or interest in any such property shall be acquired compulsorily in any part of Nigeria except in the manner and for the purposes prescribed by a law.”

The Federal Government could likely point to Section

44, sub-section (k) that makes an exception in cases “k) relating to the temporary taking of possession of property for the purpose of any examination, investigation or enquiry”. EO6 states that it aims to protect the properties while cases are still on. But such orders could be sought for and granted by the courts and not by the executive.

EO6 eerily sounds like the infamous State Security (Detention of Persons) Decree 2 of 1994. Decree 2 of 1984 prepared the ground for repression by cancelling all fundamental rights of citizens granted by the 1979 Constitution. It was promulgated on February 9, 1984, but took retroactive effect from December 31, 1983. It allowed the military to detain, indefinitely and without trial, any person suspected to be involved in “acts prejudicial to state security or (who) has contributed to economic adversity”.

It is therefore very dangerous to the freedom of all citizens when the rule of law is ignored in the name of ‘perceived’ public good as determined by the President and not by the courts. The President we see today, no matter how good intentioned, will not be there forever. Only the law, and quest for justice lasts forever and justice is what everyone seeks for and deserves.

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Thursday 18 October 2018

BUSINESS

COMPANIES & MARKETS

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ITEL Mobil captures 25.8% market share on retail volume

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

NNPC appeals to communities to prevail on oil pipeline vandals FRANK UZUEGBUNAM, OLUSOLA BELLO & HARRISON EDEH

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s calm returned to Osisioma Ngwa communities of Abia State follow ing a fire incident last Friday, t h e Ni g e r i a n Na t i o n a l Petroleum Corporation (NNPC) has appealed to the host communities to help stem the spate of vandalism of oil pipeline.

Ndu Ughammadu, the group general manager, Group Public Affairs Division, NNPC s a i d o n t h a t p re l i m i nar y reports of the fire incident which recorded some fatalities and loss of properties affirmed that the inferno resulted from the activities of vandals who had breached System 2Ex P i p e l i n e R i g h t o f Way (PROW) in Ososioma.

The NNPC spokes-

person explained in a statement issued that the confirmation of items such as jerrycans, among others, at the s c e n e o f t h e i n c i d e nt, by the report indicated that the activities of vandals in the area ignited the flame.

Ughamadu quoted the NNPC group managi n g d i re c t o r, Ma i k a n t i Baru, as saying that the incessant vandalism of pipeline facilities along System 2E x PROW has prevented the corporation from pumping fuel to the Enugu Depot which has remained underutilized despite its recent rehabilitation by the NNPC. Baru lamented the loss of lives and properties in the inferno which occur re d in the wee hours of Friday in

L-R: Ben Ahesiulo, company secretary, Afro Cultour Limited; Amaka Ezuruike, event/activations manager, Seven Up Bottling Company; Segun Ogunleye, senior brands manager, Seven Up Bottling Company, and Chuks Akamadu, executive secretary, SONIFES, at the media briefing on the 2018 edition of Song of Nigeria Festival (SONIFES) in Lagos.

Pic by Olawale Amoo

Umuaduru and Umuimo communities both in Osisioma Ngwa, in Abia State.

ICT firm launches web portal for live streaming, news without GSM data JUMOKE AKIYODE-LAWANSON

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Streams, an indigenous information and communication technology (ICT) company, has announced the launch of its unique one stop web portal, which caters for live streaming, news and infotainment.

According to a statement by the company, the platform will offer viewersaccesstoawiderangeoflive streamed events, without the need for a data bundle plan accessible for now, over GSM networks.

In a bid to counter fake news, it will also be an authentic repository, where verified and unbiased news articles, opinions, press releases and other key information can be

submitted, stored and shared to all.

Listing other features of the WStreams website, the company said advertisers can create an account, select an advert type, make the associated payment and have it automatically uploaded on the site within two hours.

Commenting on the platform’s value offering, Nelly Ekpo-Ufot, founder/CEO, WStreams, said it is a one stop destination aimed at satisfying the needs of clients and customers alike.

“The main focus of our firm is to create happiness for the teeming population of Nigerians who desperately need access to the internet and the information it offers, but are limited by low disposable income to purchase a data bundle plan,” Ekpo-Ufot said.

On the bespoke live streaming platform, up to 10,000 people can watchalivestreamatonce,depending on the selected plan, as multiple plans are available, and the specific needs of the publisher and remote viewers. It is also possible for live streams to be private (available to a select audience) or pay-per-view (suitable for concerts and events).

The website, wstreams.com has been spiced up further with a number of interesting features like an Amebo column, TapTAP for airtime, a Q&A session for smart people to earn airtime, and an inspirational blog- Careville.

“Here at WStreams, we welcome you to total freedom, where you can do almost everything that is possible on the internet without the need to have

that it will continue to add value to the society while uplifting the lives and general wellbeing of young people.

According to Kunmi Balogun, its public relations manager, the global CSR strategy of StarTimes seeks to enhance the quality of life of youths and children across Africa and StarTimes Nigeria has demonstrated this through various CSR projects across Nigeria.

This initiative, he said: “Is in furtherance of our initial support to SOS Children’s Vil-

lages Nigeria a few months ago. Having visited their facility in Gwagwalada, Abuja, we realised there was need for further support to the centre in ways that touch beyond the components of our MoU, especially in the area of healthcare for some children in the facility, hence the decision to give more funds towards this course.”

Balogun added that StarTimes focuses on children because they are the most vulnerable in the society and require the most attention.

StarTimes extends CSR to healthcare SEYI JOHN SALAU

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esirous of creating a sustainable social value and alleviating the suffering of the less-privileged children in society, pay TV provider, StarTimes Nigeria, has undertaken to make provision for the health care needs of 22 children under the care of Save Our Soul (SOS) Children Villages in Nigeria.

The company made this known in a statement, noting

The GMD appealed to host communities to collaborate with the corporation to tame oil

p i p e l i n e va n d a l i s m i n their areas.

Baru lauded the State fire servicemen and

NNPC officials for their prompt response which rapidly brought the situation under control.

US-based retailer Sears files for bankruptcy DIPO OLADEHINDE

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ears, the US department store chain that once dominated America’s shopping malls has filed for bankruptcy crumpling down to massive debt load and staggering losses.

The firm filed for Chapter 11 bankruptcy early on Monday morning after it was reported it could not meet a $134 million repayment following a multi-year battle to stay afloat amid steep declines in sales and customer traffic.

Chapter 11 protections postpone a US company’s obligations to its creditors, giving it time to reorganize its debts or sell parts of the business.

The outgoing CEO Eddie Lampert blamed the company’s decline to shifts in consumer spending, rising e-commerce businesses among other reasons as the company has suffered, along with many other traditional

retailers, from rising online competition from firms such as Amazon.

“Over the last several years, we have worked hard to transform our business and unlock the value of our assets, while we have made progress; the plan has yet to deliver the results we have desired,” Lampert, outgoing CEO of Sears said on Monday.“Addressing the Company’s immediate liquidity needs has impacted our efforts to become a profitable and more competitive retailer.”

The company said it will close 142 stores before the end of the year and Eddie Lampert will be stepping down as CEO, though he will remain its chairman.

Lampert said that Sears and Kmart stores “remain open for business” towards the holiday season, and that the bankruptcy process will allow the chain to “strengthen its balance sheet,” to “accelerate its strategic transformation,” and ultimately to “return to profitability.”

According to U.S based Business Insider, Sear’s sales tumbled from $53 billion in 2006 to less than $17 billion last year, Sears has closed hundreds of stores, reducing its total locations to 866 stores as of September 13, down from 1,980 stores in 2013.

For years, Lampert has kept the ailing retailer afloat through billions of dollars in loans from his hedge fund, ESL Investments, the selling off of valuable real estate, and the slow dismantling of Sears’ exclusivity over some big American brands.

The 125-year-old retailer, once the most iconic retailer in America, has seen its sales cut in half since 2014. It has been burning through cash, closing hundreds of stores, and slashing jobs in an attempt to stanch the bleeding.

The company employs nearly 90,000 people in the US, although that is down from 246,000 five years ago, and in its heyday it had more than 3,000 stores. It became America’s largest retailer before being overtaken by Walmart in the 1980s.

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ITEL Mobil captures 25.8% market share on retail volume …beat peers in new Euromintor report

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atest Euromonitor International report for August focused on Mobile phones in Nigeria has shown that one of Transsion Holdings biggest mobile phone maker, itel Mobile has beat peers to hold the second position in retail volume with a market share of 25.8 percent.

This has received the commendation from industry watchers to crown the brand’s efforts in becoming a top market leader in 2018.

Despite the influx of Chinese manufacturers and domestic players in the business landscape with strong price competition and demand for high quality products, the report has revealed that Transsion Holdings still holds the top position with the highest brand market share in the Nigerian mobile phone industry as at the end of August 2018.

With itel’s key interest in focusing on long-lasting battery technology and camera capabilities, this surge in brand’s shipment and market share can be traced back to the manufacturer’s consistent

smartphone launch in Q2 and Q3, strong distribution network, availability and variety of affordable feature phones and smartphones, pitted directly against Nokia and Gionee’s portfolio.

More recently, the increasing use of social media and upgrade to smartphones by target market segments especially young consumers due to the economic growth and dependency on internet-enabled services, the report forecast a strong volume growth in smartphone penetration in Nigeria.

Furthermore, following the early and successful passage of the Telecommunication Critical Infrastructure Bill by Nigeria’s legislature, competitive pricing among internet service providers is expected to boost internet usage to more affordable internet provision in Nigeria, which is at 47 percent of the population in 2018.

The Chinese conglomerate, Transsion Holdings has remained a dominant force within the Nigerian mobile phone industry with a retail market share of 75.2

percent taking an increase from 73. percent in 2017. The global brand continues to combine its technological prowess with design and innovation to gain industry attention with products created groundbreaking interactive and immersive consumer experiences. Their continuous success is as a fact of the brand’s carving a niche for itself by creating a variety of smartphones to meet the needs of the diverse income segments of the growing population.

The underlying question remains, will itel Mobile and Transsion Holdings continue to hold a sustainable position at the top ahead of other smartphone brands? Over the years, since its inception, itel Mobile has taken the world by storm with a displayed evidence of strategic communication to meet the needs of its target market, nevertheless it will be interesting to see the brand leverage on its strong growth to implement strategies and overcome the associated negative perceptions and stiff competition.

L-R: Sola Oyegbade, head, training academy, First City Monument Bank (FCMB); Kehinde Folorunsho, senior manager, Pedabo Professional Services; Adebamiji Adelaja, assistant manager of the firm; Enahoro Okhae, chief executive officer, Pause Factory Limited; Tochukwu Ezeukwu, partner in the firm, and Olumide Ekun, team lead, learning & development of FCMB, during the Business Empowerment & Sustainability Training (BEST) programme organised by the bank for Small and Medium Scale Enterprises (SMEs). The free training in Port Harcourt, Rivers State.

APM Terminals Apapa raises awareness on dangers of plastic pollution AMAKA ANAGOR-EWUZIE

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artin Jacob, managing director of APM Terminals Apapa, has made case for properdisposalandrecyclingofplastic wastes to reduce its harmful effect on the ocean, wildlife and humans.

Jacob, spoke during a cleanup exercise organised by APM Terminals Apapa in partnership with Wecyclers at the Ogogoro Island, a riverinecommunityinApapa,Lagos as part of the company’s 2018 “Go Green” campaign.

During the exercise, about 120 employees of the company, Wecyclers volunteers and residents of the communitytookpartinthecleaning exercise; collecting trash and other litters that weighed 228kg from the shoreline of the island.

“Go Green” is a worldwide campaign set up by world leading container terminal operators and port authorities, with the aim of raising awareness of the global natural and social environment and improving conditions in these areas. The campaigniscarriedoutannuallythrough volunteer activities such as creating and upgrading local green spaces, launchingeducationalprogrammes, adopting waste recycling measures

and community engagement.

Jacob said the cleanup exercise wasaimedatraisingtheawarenessof APMTerminals’staffandthegeneral community on the importance of environmental care through proper management of plastic waste.

Jacob, who noted that it may be difficult to abolish the use of plastic bottles, said there is however, an urgent need to take action against plastic pollution in Nigeria to protect the marine environment.

“In Nigeria, very often you see the whole place flooded. This is all because of the plastic bottles we throw in the drains. So, we want to spreadthemessageamongourcommunities and also our employees to inculcate the culture of disposing plastic waste in a proper manner, in other words, recycle it.

“We can’t stop using plastics.

Plasticnowadayshasbecomepartof ourlives.Evenifyoubuychocolatein thesupermarket,theygivenylonand youacceptitandthatisthereasonwe finditeverywhere.Thisinturncauses more damage to our environment.

Plastic gives us a lot of benefits but careless usage is what is giving us the problem we face today,” he said.

According to him, there are islands of plastic bottles floating

around the ocean, which we can avoid its dangers in the environment by handling them properly. “This is not going to be a one-day thing for us; it is what we should take home, at work and in our families to spread the culture.

Alade Isaiah, one of the leaders of the Ogogoro Island community, expressed appreciation to APM Terminals for taking up the clean up exercise, even as he urged other port operators to emulate the good gesture.

“We love what APM Terminals has done by cleaning our environment.Ourwomenandchildrenhave also supported them in this cleaning exercise. We will emulate this fine example by keeping our environment clean so that the dirt around do not go inside the water,” he said.

Research has shown that environmental pollution caused by plastics is capable of causing harm to land, waterways and oceans. Living organisms, particularly marine animals, can be harmed either by mechanicaleffects,suchasentanglement in plastic objects or problems related to ingestion of plastic waste, or through exposure to chemicals within plastics that interfere with their physiology.

L-R: Samuel Salako, partner, Olajide Oyewole LLP; Peter Bradshaw, partner, DLA Piper Africa; Dayo Idowu, partner, Olajide Oyewole LLP, and Christopher Baird, partner, DLA Piper Africa, at the DLA Piper Africa Merger and Acquisition Academy in Lagos.

L-R: Comfort Isibor, assistant director, National Oil Spill Detection and Response Agency; Remy Chukwunyere, special assistant, job creation, Imo State Government; Bekeme Masade, chief executive, CSR-in-Action; Chizuru Kanu, commissioner, ministry of petroleum, Abia State, and Austin Onuoha, director, african centre for corporate responsibility/consultant, CSR-in-Action at the roundtable discussion with government stakeholders to review a Draft Community Engagement Framework developed by CSR-in-Action in Abuja.

NBC, Coca-Cola Nigeria recognized for good compliance to standards DANIEL OBI

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he National Agency for Foods and Drug Administration and Control (NAFDAC) has commended the Nigerian Bottling Company (NBC) Limited and Coca-Cola Nigeria for compliance and adherence to the standards, guidelines and regulations necessary for food safety and quality.

Moji Adeyeye, director general, National Agency for Foods and Drug Administration and Control (NAFDAC) gave this commendation shortly after a tour of the Nigerian Bottling Company (NBC) Limited Ikeja Plant with officials from the Agency recently in Lagos.

Adeyeye expressed satisfaction with NBC and Coca-Cola Nigeria on their continued investment in world-class facilities and upgrade

of their production lines in line with the global best practice.

Adeyeye noted that the tour of the facility is in line with its role as a regulatory body to carry out regular check on businesses with a view to safeguard the health of Nigerians and ensure compliance to quality and food safety procedures.

In terms of relationship with the Agency, I must note that the Coca-Cola System (Nigerian Bottling Company (NBC) Limited and Coca-Cola Nigeria) has been very engaging, transparent and proactive thereby making our work a lot more easier. I can say that our work has been enhanced not only as regulator safeguarding the health of the people but also as enabler in enhancing the capacity of the beverage industry. We are indeed very glad with the facility we have seen here today, it is a great facility,

she said.

In his remarks George Polymenakos, managing director, Nigerian Bottling Company (NBC) Limited, expressed appreciation to NAFDAC for the visit noting that the support from the regulatory agency has contributed a great deal to improving its business performance.

We are grateful to the team for this routine visit. I must state that your role in granting approvals promptly has helped our business operation and performance, Polymenakos said.

Managing Director, Coca-Cola Nigeria, Bhupendra Suri equally thanked the NAFDAC delegation for the routine visit even as he vowed that the Coca-Cola system would continue to uphold standards so as to safeguard the health of the people and the environment.

L-R: Adewale Jones, executive secretary, Association of Food Beverages Tobacco Employers AFTBE; Moji Adeyeye, director general, National Agency for Food, Drugs Adminstration & Control (NAFDAC); Patrick Anegbe, managing director, Intercontinental Distillers Limited( IDL ); Monica Hemben-Eimunjeze, director registration and regulatory affairs NAFDAC, and others, when NAFDAC paid a visit to IDL’s factory at Ota, Ogun State, recently

BUSINESS DAY

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CityFile Okorocha, Bagudu to grace COWLSO’s conference

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A petrol tanker that got stucked in the mud at Umunya-Nteje stretch of Onitsha-Enugu Expressway, which was washed away by flood on Tuesday. NAN

Boundary dispute: A’Ibom, Abia sue for peace ANIEFIOK UDONQUAK, Uyo

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ollowing the eruption of boundary skirmishes between the people of Ikot Udo in Ika local government area of Akwa Ibom State and their neighbours in Okrika Obu in Ukwa East local government area of Abia State, an appeal has been made to the two communities to sheath their swords and embrace peace as the National Boundary Commission (NBC) prepares to bring a lasting solution to the troubled area.

The two states which met at the disputed boundary between Ikot Udo and Okrika Obu, disclosed that the reason for their visit to the disputed area was not to determine or demarcate the boundary between the two communities but to appeal to them for peace and calm as both people are historically extracts of the same linage.

Both states, represented by their deputy governors, Moses Ekpo and Ude Oko Chukwu of Akwa Ibom and Abia States respectively thanked the people for their show of maturity and love for peace without any shedding of

blood in the troubled area.

They reiterated their concern about the safety, welfare and the peace of the people, and that this has necessitated their prompt visit to the area today immediately the two state governments got wind of the impending boundary skirmish.

They appealed to the warring communities to give peace a chance as proper determination and demarcation of the boundary between them will soon be carried out by the NBC without fear or favour.

They urged the people to understand that the development and transformation of their communities could only take place in the presence of peace, safety, and tranquility rather than in the presence of violence and killings.

While reminding the people of their emergence from one family of two brothers that claim to separately belong to the two different states, stressing that their decisions to claim different state citizenships do not at all invalidate their age long existing brotherhood and brotherliness.

They also charged both communities to ensure that the electrical transformer and other

public facilities put in place by the Akwa Ibom State government at the area are not vandalised as anybody caught in the act will be treated as a criminal.

Both state governments directed the security operatives from the two states to secure the area appropriately against any uprising or moves to destroy or cause further disaffection between the two communities pending the final resolution of boundary dispute by the NBC in no distant time.

They urged the people to realise that land belongs to no man but to God who makes man to only live on it as a privilege which cannot even be carried along in the course of one’s death, adding that no blood of anybody deserves to be shed in the altar of land struggles or crises.

The event also witnessed the attendance of the two states’ commissioners of police, surveyors general, commissioners for lands and town-planning, justice, council chairmen of Ika and Ukwa East local government areas, traditional rulers, and a host of other government dignitaries of the two states, as well as a crowd of citizens from both states.

Abia probes oil pipeline explosion ... as Assembly invites ABUTH mgt over power outage in hospital

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bia State government says it will probe last week’s oil pipeline explosion which claimed several lives and destroyed property worth millions of naira.

Chikwendu Kalu, speaker of the state House of Assembly, stated this on Tuesday. The explosion occurred on Friday, October 12, in two communities in Osisioma Ngwa local government area of the state with about 24 persons confirmed dead.

Kalu, during a visit to the survivors of the incident, Chima Kaobi and his wife, Amarachi, also promised that the government would initiate necessary measures to forestall a recurrence.

According to him, the state government would set up an investigative panel to ascertain the immediate and remote causes of the

explosion.

Kalu, who expressed concern over the critical condition of the couple, appealed to the management of Abia University Teaching Hospital (ABUTH) to do everything possible to save their lives.

Agnes Onyekachi-Chigbu, the chief nursing officer at the hospital, said that the couple had ‘mixed thickness’ and that the medical personnel were struggling to save their lives.

Onyekachi-Chigbu said that four victims, including the couple, were brought to the hospital on Friday but that the other two died on Saturday. She said that the couple was asleep in their house when fire from the explosion engulfed their home.

According to her, the woman, who rushed

to wake her husband and their four children, was also affected by the fire with her husband, while the children escaped unhurt.

Meanwhile, the speaker has decried the power outage at the hospital, especially at the Intensive Care Unit (ICU) during the visit.

He described the development as worrisome and ordered the management to switch on the hospital’s power generator in order to save the lives of the patients.

The electrician in charge of the hospital’s power unit explained that it was management’s rule that the generator should only be switched on between 7.30 p.m. and 11.30 p.m. daily.

But the speaker directed the hospital management to appear before the state House of Assembly over the development.

ochas Okorocha, governor of Imo State and Abubakar Bagudu of Kebbi State are some of the personalities expected to grace the 2018 national women’s conference, an annual event organised by the Committee of Wives of Lagos State Officials, (COWLSO).

Bolanle Ambode, wife of Governor Akinwunmi Ambode and chairman of the COWLSO, disclosed this to news men on Tuesday just as she assured participants that the conference being the 18th edition, would be better than the previous editions.

According to Bolanle, the three-day conference, which kicks off Tuesday, October 23 to Thursday, October 25, at Eko Hotels and Suites, Victoria Island, is themed: ‘Strengthening our collective impact’. It will focus on the advantages derivable when women act together, as against going solo.

“This theme focuses on the advantages derivable from our collective impact, compared to when we act alone. If you take a closer look at our society, women are strong willed. It is very obvious that God created and endowed us with skills, innate abilities and a hidden strength that no one can explain”.

“When we come together and collaborate, whether in government establishments, privately owned businesses, NGOs or wherever we find ourselves, we tend to achieve significant lasting social change that will be beneficial to all. We have unique powers of being able to look at problems and come up with solutions that would transform lives and make the world a better place.”

Ikpeazu offers free eye treatment to drivers UDOKA AGWU, Umuahia

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kechi Ikpeazu, wife of the governor of Abia State has said that her nongovernmental organisation-Vicar Hope Foundation will partner with the Federal Road Safety Commission (FRSC) and the Nigeria Optometrist Association to conduct free eye check and treatment on all registered commercial vehicle operators in Abia.

The aim, according to the Ikpeazu, is to ensure safe drive for commuters and transporters as the yuletide period approaches.

Ikpeazu made this knwon at an event held in Umuahia by a combined team from Women Optometrist Association and Vicar Hope Foundation when 1600 persons were tested and treated free in celebration of this year’s World Sight Day. She noted that the eye was one sense organ which when impaired could cause disorientation for any victim. She advised parents to ensure that they have their children examined by optometrists at least once a year while she decried the patronage of quacks traditional, and spiritual healers by people when they fell sick adding that eye disorders could only be handled by professionals.

Ikpeazu called on government, public and private institutions to give more attention to research on eye problems and sight aid while building codes should be made friendlier for disabled people.

Ikonne the guest lecturer of the day, earlier in his speech had revealed that 80percent of eye disorders were preventable. He also disclosed that food and lifestyles affect the sight while most people who have poor or deteriorating eyesight hardly notice until very late. He therefore advocated for regular checks by professionals.

John Ahukanna, the Abia State commissioner for health, who was represented at the event by Jachmike Enwereji pointed out the challenge of getting the rural dwellers and the poor to appreciate the need to patronize qualitative care-givers rather than resorting to home remedies.

Ahukanna noted that a large percentage of blind people fall into the class of those who patronise he quacks and emphasized the need for sensitization for the rural people.

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BUSINESS DAY

Thursday 18 October 2018

Innovation

Apps

Fin-Tech

Start-up

Gadgets

Ecommerce

IOTs

Broadband Infrastructure

Bank IT Security

BUSINESS DAY

Thursday 18 October 2018

17

Two startups show how Lagos Innovates is changing government support in tech Stories by FRANK ELEANYA

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agos is one of the busiest cities as well as the most populous in Africa. It is also the nerve centre of entrepreneurship with millions of young people striving to exit the unemployed bracket.

Ifeanyichukwu Ngobili, cofounder of Urban Errands co-founder of Urban Errands would tap into this energy one fateful harmattan morning in 2017 to build a new tech-based startup.

His daughter’s birthday planning was in full swing.

His wife needed a gas refill to prepare the meal their guests will eat and being a very busy professional was not helping as the date for the celebration raced closer. In his efforts to find someone to help him refill the gas cylinder, it dawned on him that there may be other young professionals that could be in his position. He decided to come up with an application that makes it possible to connect domestic help with people who need their help. That was the birth of Urban Errands.

Urban Errands provides a platform where busy professionals can find well trained and trusted people – called Taskers – to help them with

their domestic activities like cleaning, washing, market runs, shopping and many other errands for a fee. The startup is a recipient of the Lagos Innovates Workspace voucher initiative.

Lagos Innovates was launched by the Lagos State Employment Trust Fund (LSETF) as a set of programs aimed at making it easier to build successful tech startup in Lagos. The programs are designed to help the very best founders and startups by facilitating access to four things: 1) high quality workspaces and infrastructure, 2) learning, 3) early stage investment capital and 4) investor and peer networks.

A guideline on Lagos Innovates website explains that the workspace vouchers support the highest potential founders and/or startups in Lagos State at the very early stages of their ventures (ideation to very early revenue) by facilitating access to well-equipped workspaces and learning. Lagos Innovates has so far issued N80 million workspace vouchers to 50 startups.

Another beneficiary of the workspace initiative is ScholarX, an education platform that connects young people with alternative funding for their education, whether through crowdfunding or low interest rate

our operation. From an overhead standpoint, our revenue was not enough to say we want to get an office.

Urban Errands told BusinessDay that getting a workspace was necessary for registering, training, and addressing clients’ enquiries concerning their taskers.

“Because we are strictly an online platform, we do not have so many people under our payroll, but we needed a space, where we can easily ask the taskers to come with their documents and we can ask them a series of questions,” Ifeanyichukwu Ngobili of Urban Errands told BusinessDay.

loans.The recipients pay when they are done with school and are working.

“I got admission abroad but school fees were not coming frequently so I had to find a way. But paying wasn’t easy and I was kicked out of school,” Bola Lawal, co-founder and CEO of ScholarX told BusinessDay during an interview. “Years after, I was able to get scholarships and some friends wanted to help out by creating an app where students can easily find scholarships which brought me back to my personal experience. I thought about it that if me in the US is struggling like

this, there are millions of students, particularly in Nigeria who do not have access to education. A lot of them are because they do not have access to opportunities, they do not even have an idea where they can find it. When we were developing the idea it resonated with me personally. If I that some people will classify as privileged I knew how difficult things were for me. Compare that to people in low income areas in parts of Nigeria and Africa, there is no shinning light on them to show people that they need help.”

Trust and lower overhead

worries The workspace voucher is designed with the objective to relieve financial stress with regards to renting a space from startups. Urban Errands and ScholarX - both early stage startups fit the profile of hundreds of startups that struggle to scale because they lack physical spaces where clients can meet them.

“For what we do, trust is a very big factor,” Lawal explained. “We needed a physical location where people could have physical meetings with us. Most importantly, we knew that we needed a space to boost

The application process Lawal recalls that application process was a “little too extensive” and took more a day to complete. The workspace voucher application process is fully automated.

However, startups that want to selected will have to provide documents that show they are serious.

“We took two days to complete the application – also because I had other things to do,” Lawal said. “It was worthwhile because of the questions they will ask you.”

ScolarX and Urban Errands currently work out from the Leadspace innovation hub.

people in this age bracket are concerned when things are going wrong in the economy. This is unlike popular notions that seem to suggest millennials only care about adopting and playing with new technological innovations. Issues such as unemployment, slow growth in economy, marriage and belief in God fall among major concerns.

A statement from SPACE noted that it offers a full scope of services such as media and strategy to creative, PR and client service as well as production to its clients. Its model allows every team member to get started on a job at the same time, instead of being briefed at different phases,

allowing for a more seamless and effective solution.

SPACE also said it provides clients with the right solutions and the right people at the right cost.

“It is difficult to commoditize the services ad agencies provide to their clients, because we do not provide identical, comparable units of service,” Eza said. She adds that one would never look for the cheapest doctor in the neighbourhood, and that the same preference for quality increasingly applies when clients look to services from agencies. “Our job is to change or reinforce human behavior.

Essentially clients are buying experitise and when it comes to expertise, all things are not equal,” she noted.

SPACE banks on data-driven advertising for West Africa brands

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rands’ relevance in the digital age could depend on how much they understand the changing taste of the demographics they plan to sell to. SPACE, a strategy agency based in Amsterdam last launched its West African office in Lagos Nigeria and is planning to leverage big data analysis to help brands in the region stay competitive and scale.

The company also recently conducted a Youth Opinion Report which it said will give major brands insight into the behavior of millennials population in Nigeria.

“We want to b e the agency that knows Africa, which is why we launched our Youth Opinion Report,”

Frances Eze, country manager, SPACE Nigeria said at the launch of the company’s office in Lagos. “Our results are driven by hard core data.

We keep pushing and continue to interrogate.”

While presenting the report on Nigerian millennials, Johan Prins, director of strategy, SPACE noted that most brands fail to realize that while fundamental human nature has not changed, the way they express that nature has changed.

SPACE approach to advertising, he noted, is not to assume it knows what people want, “We go out and we ask them about it.”

For instance, the Youth Opinion Report on Nigerian millennials found that

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

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BUSINESSTRAVEL

Sabre charges airlines, travel agents to embrace technology …Gives brand new Kia Car to best partner Stories by IFEOMA OKEKE

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he leading United States US technology solution provider for airlines and travel trade, Sabre Network West Africa has advised airlines and travel agents in the country to migrate to its platform, which it described as the best globally.

The company stated this over the weekend in Kano State where it felicitated with its long standing partners in the Northern Zone of the country by giving out various prizes ranging from cash, refrigerators, screentouch laptops, air conditionals, while the grand prize winner - Hamsyl Travels and Tours went home with a brand new KIA Rio car.

Speaking at a forum oganised for travel agents and airlines in the zone with the theme: ‘Do it Right,’ Gabriel Olowo, the president, Sabre West Africa said that the company had grown to become the leading technology organisation in the world for airlines and travel trade.

Olowo explained that unlike other platforms where travel agents incurred Agency Debit Memo (ADM), after little errors in bookings; the reverse was the case with Sabre.

Sabre commenced operations in Nigeria over a decade and has spread its tentacles to other West African countries; Senegal, Cote D’ivoire, Liberia, Cameroon, Ghana) within the period.

The Sabre boss noted that with improved technologies in the global aviation industry, it was

pertinent for stakeholders in the sector in Nigeria to device a mean of relevance, warning that without this, most of them would be left behind in industry development.

He explained that Sabre would help to improve the services of travel agents, hoteliers, tour companies and airlines, stressing that Nigerian carriers had a lot to learn from their foreign counterparts in technology, especially those who have migrated to the network.

He said: “Our strongest partners and testimony seated at this forum include Ethiopian, Etihad, Emirate and Turkish Airlines to mention, but few.

“Azman Airlines and Max Air will come on board soon. Sabre is the

best as it partners with the leading airlines in the world including startup airlines. The only assurance we are giving airlines and travel agents in this country is that once we partner with them, they will begin to do it right. I want to thank the American company for the confidence in appointing us as its JV partner.”

Olowo also promised to donate a bus each to the five zones of the National Association of Nigerian Travel Agency (NANTA), which included Lagos, Port Harcourt, Abuja and others, saying that this would also ease movements among the members of the group.

Awards during the forum included cash presentation of N1,090,000 to Agaji Travels and

Tours, N1,400,968,000 to Madina Travels and Tours while the sum of N1,795,610 went to Raudah Travels.

The grand prize of Kia Rio Car went to Hamsyl Travels and Tours with other consolation prizes of touchscreen laptops, refrigerators and umbrellas to other travel agents. This is the second time Hamsyl would be recognised for its strong commitment to Sabre.

About four years ago, the company also won a staff bus.

Hamisu Inuwa, the chairman of Hamsyl Travels, lauded Sabre for the price of the Kia Rio to his company.

He assured Sabre of its continued commitment and promised to spread the good news.

He said: “This is the happiest day

in the life of this organisation. I am very happy that we got the grand prize of a car. Four years ago, we equally earned the grand prize of a bus and today is another achievement for us.”

Besides, Aliyu Abdullahi, managing director of Blue Wings Travels, NANTA Northern Zone, urged all players in the sub-sector to sign on to Sabre.

He also commended Olowo for the consideration buses to all the zones of NANTA, stressing that this would also drive their business.

Mohammed Usman, managing director, Biliyu Travels who also doubles as the President of Sabre Devoted Users (SDU) Northern Zone, insisted that Sabre was a company to partner with for improved businesses.

Besides, Emmanuel Isola, the country director, Sabre Nigeria, during his speech, said that the trust Sabre devoted users had in the company earned them the numerous awards.

He added: “As the business world requires external focus, collaboration and team work, we at Sabre build extra-ordinary team with exceptional people for mutual benefits and our only challenge is their future.”

There were also paper presentations by Hannah Ogunsulire, the head, research and manpower development - Sabre West Africa and Olusegun Taiwo, head technical service of the company.

Ogunsulire’s paper was titled ‘Do it Right’ while Taiwo presented a paper on ‘Creating Online Sales, which is the future of the Industry.

KLM treats customers with new rituals line

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hen the winter timetable starts on Sunday 28 October, KLM will pamper its customers with its exclusive Rituals product line – “The Amsterdam Collection.”

The products have been developed specially for KLM customers and consist of products that evoke the ultimate sense of relaxation during and after the flight.

In creating the Amsterdam Collection, Rituals was inspired by the idea of “Where the Far East and the historical West first met.” The scents in the new line are a reflection of Dutch tulips and Japanese yuzu.

The Rituals products will be introduced on board in phases starting Sunday 28 October 2018.

The look and feel of ‘The Amsterdam Collection’ is inspired by the design of ‘The vase with lid’ (dated 1695-1700) by the artist Gerrit Pietersz. Kam. The vase has been owned by the Rijksmuseum since 1969. The flowers and branches on the vase with lid are based on Asian ceramics and textiles.

Rituals in economy class and world business class The new Rituals care products are available exclusively on KLM flights. For Economy Class customers, there will be hand care foam in the lavatories. World Business Class passengers will also have access to hand and body lotion, hair gel, and body mist in the lavatories. They will also receive a stylish set of face

moisturizer and lip balm.

Tulips and yuzu Tulips are known for their soothing and softening effect on dry and sensitive skin. They help protect against free radicals and have moisturizing properties that prevent skin from ageing. Yuzu is both a citrus tree and fruit. The yuzu – sometimes called the Japanese citron – is highly nutritious. Its juice is often used as a painkiller and promotes relaxation. The fruit’s flesh is rich in antioxidants.

For KLM, the partnership with Rituals is a new step in giving KLM passengers a memorable travel experience, allowing them to arrive at their destination refreshed, rested, and energised.

NAMA corporative society records N35m net profit in 2017

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total of N35million net profit was recorded in 2017 by the Cooperative Multipurpose Society Limited (CMSL) of the Nigerian Airspace Management Agency NAMA, Murtala Muhammed International Airport Ikeja Speaking at its 16th Annual General Meeting AGM held over the weekend in Lagos, Edino Ilemona Amos, the president of the CMSL, disclosed that the cooperatives has continued to soar in its activities with steady growth.

According to Edino, in 2014, it generated a net profit of N17. 8million,

N21.9million in 2015 and N28.9million in 2016, with a better future performance.

He said members’ savings have increased by 30% from N314m to N327m during the year under review while loan disbursement has also improved tremendously against the previous year.

Edino disclosed that the cooperatives has introduced various products to enhance the status of members, such as special savings welfare scheme, zero savings car purchase scheme, land and house purchase scheme, ordinary

loan distribution among others.

He noted that at the beginning of this year, the cooperatives projected about 40 members to be proceeding for retirement with a projection of N100m required for the settlement of their claims.

While apologising to those members that had delays in loan disbursement, Edino assured them of stronger Cooperative Multipurpose Society the influx of new members adding that as the last count they were over 500 members with a relative increase in monthly revenue.

Air Peace receives fifth ERJ 145, set for Sokoto, Katsina flights

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ir Peace, Nigeria’s leading airline, on Sunday took delivery of its fifth Embraer 145, assuring that the development has deepened its capacity to relaunch its flights to Sokoto and start its Katsina service.

The carrier, which had earlier received four of the six 50-seater Embraer 145 aircraft it recently acquired, said its goal of unifying Nigeria through air transport and extending its flight operations to unserved and underserved cities was fast being realised under its subsidiary, Air Peace Hopper.

A statement signed by Chris Iwarah, Air Peace corporate communications manager, said the latest delivery touched down at the Murtala Muhammed Airport, Lagos at about 6.30 p.m. on Sunday.

The new aircraft, marked 5NBUX and named Udoka Ozor (Nee Onyema), the statement added, would be deployed on the Sokoto and Katsina routes in about two

weeks’ time.

“We are pleased to announce the arrival of our fifth Embraer 145 aircraft in Lagos. The aircraft, which is marked 5N-BUX and named Udoka Ozor (Nee Onyema), landed at the Murtala Muhammed Airport, Lagos at about 6.30 p.m. on Sunday, October 14, 2018.

“We have now received a total of five of the six Embaer 145 aircraft we recently acquired as part of our fleet expansion project. We are delighted that with the arrival of the aircraft, we will relaunch our Sokoto operations and start our Katsina service in the next two weeks.

“Air Peace is committed to our no-city-left-behind project under our subsidiary, Air Peace Hopper.

We are honoured that our involvement in the aviation industry is fulfilling our goal of uniting Nigeria through air transport, creating thousands of direct and indirect job opportunities and lifting Nigeria’s economy,” Air Peace said.

Thursday 18 Octoer 2018

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

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In association with research@businessdayonline.com

08098710024

How re-investment plan can help reduce unclaimed dividend OGHOGHO EDOSOMWAN

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statements 2017. Our analysis was based on 25 out of the 40 companies that are components of the NSE Pension Index, a sub sectoral index listed on the Nigerian Stock Exchange (NSE), as we could not trace the figures relating to unclaimed dividends of the remaining 15 firms in their annual reports. Based on the figures extracted, the total unclaimed dividend for all the companies in the chart above was N54 billion for 2016 and N61.4 billion for 2017.

In 2016, Access Bank, African Prudential, FBNH, UBA and Guinness have the highest percentage of unclaimed dividends relative to the total unclaimed dividend as these firms accounted for about

69 percent.

In 2017 and using the same measure, Access Bank still came first followed by African Prudential, FBNH, GSK and UBA. Guinness had same percentage for both years and GSK moved from one percent in 2016 to 10 percent in 2017.

However, Continental Re-Insurance, Nigerian Breweries, Unilever, International Breweries, Cadbury, Honeywell Flour, AXA Mansard, Nestle and Conoil maintained very low unclaimed dividends in both 2016 and 2017 when compared to other companies.

Operators and Analysts have so far presented countless reasons

company stock, that is, (100 shares x N1 per share) / N10 per share = 10 shares]. In most cases, these shares are discounted and free of brokerage charges.

In many cases, optimistic investors prefer to gain additional equity in a company rather than receive the cash dividends related to their holdings. DRIP provides investors with a system of recurring dividend reinvestments. In other words, rather than receiving cash from a declared dividend, participating investors receive shares and fractional shares of company stock of equivalent value.

Investors purchase shares with dividends that the company reinvests for them in additional shares.

Most dividend reinvestment plans also permit investors to make voluntary cash payments directly into the plans to purchase shares. In some cases, companies charge no fees for purchasing stocks through DRIPs, and those that do charge only a nominal fee.

For the shareholder, DRIPs offer a way to accumulate more shares without having to pay a commission. Many companies outside Nigeria offer shares at a discount through their DRIP from 1 to 10 percent off the current share price. In addition, no commissions are charged plus a price discount, the cost basis for owning the shares can be significantly lower than if the shares were purchased in the open market.

For companies, they can benefit from DRIPs in a couple of ways.

First, when shares are purchased from the company through a DRIP, it creates more capital for the company to use. Another reason is DRIP participants can more easily recognize the role their dividends play in the longterm growth of their investment strategy.

DRIPs offer advantages but also have drawbacks. One disadvantage of DRIPs is the inability to sell or buy as quickly as you could if you owned the shares in a regular brokerage account. In a regular account, you can respond more quickly to a rise or fall in the market, thereby having some control over the price at which the stock is bought or sold.

12734BDN

ver the years, the incidence of unclaimed dividend in the Nigerian Capital Market remains one of the perennial issues that continue to increase while the apex market regulator, the Securities and Exchange Commission (SEC), is yet to come up with a clear-cut plan on how to solve the problem permanently despite the introduction of e-payment system.

The Company and Allied Matters (CAM) defined unclaimed dividend as returns on investment that are not claimed by investors within three months after the declaration at the Annual General Meeting (AGM) and are returned to the companies from where investors can claim their dividends but not later than 12 years.

SEC has expressed concerns over the continuous rise in unclaimed dividends which is disadvantageous to the growth and development of an emerging market and its ability to attract direct foreign investments.

Unclaimed dividend has been on the increase over the years, from N50.1 billion in March 2012, to N102 billion in June 2015 and then to N129.6 billion at the end of December 2017 as published by SEC which was analysed by BusinessDay Research and Intelligent Unit (BRIU). The trend therefore shows a 159 percent increase from 2012 to 2017 despite efforts to reduce it.

On a quarter on quarter basis, the figure increased by 21.9 percent from N50.1 billion in March 2012 to N61 billion in March 2013. It further increased by 35.8 percent to N83 billion in March 2014 from its level in the previous quarter.

Furthermore, there was approximately 10 percent increase to N109 billion in March 2016 from N99 billion in March 2015.

Between March 2016 and March 2017, it increased by 12 percent to N121 billion from N109 billion in the corresponding period.

Unclaimed dividend of the companies listed above was obtained from their audited financial

for the increase in unclaimed dividends. These reasons include but not restricted to issue of multiple applications for shares, the complicity of registrars, ineffectiveness of the Nigerian postal services, and the disposition of uninformed investors, among others.

The regulations have made some frantic efforts to curtail the incidences of unclaimed dividends through the introduction of e-dividend system of payment which was introduced by the Securities and Exchange Commission and formally launched into the Nigerian Capital Market on 28th February, 2008.

It was introduced in order to facilitate the reduction in the quantum of unclaimed dividend.

Also, the e-dividend was to provide direct access to dividends by investors and enable investors enjoy the benefits of the Direct Cash Settlement.

The essence of any investment in the shares of a company is either profit taking i.e. taking advantage of fluctuation in the prices of shares invested in or taking part in profit sharing through dividend.

Based on this SEC directive, shareholders still need to contact the affected registrars for their unclaimed dividends who will now refer the issue to the paying company after it has been duly verified that they have an outstanding dividend to claim before they eventually get paid.

Since the e-dividend payment had little or no impact in reducing the amount of unclaimed dividend, the introduction of the Dividend Reinvestment Plan (DRIP) should be experimented as it has the tendency to help tackle this problem.

A dividend reinvestment plan (DRIP) as a plan is offered by a corporation that allows investors to reinvest their cash dividends into additional shares or fractional shares of the underlying stock on the dividend payment date.

For better understanding, let us imagine a scenario where company “A” stock is valued at N10 per share and “A ”declares a dividend of one N1 per share.

A DRIP participant holding 100 shares will receive 10 shares of

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Spending Trends

U.S. retail sales increase modestly; consumer spending strong

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.S. retail sales barely rose in September as a rebound in motor vehicle purchases was offset by the biggest drop in spending at restaurants and bars in nearly two years.

But other details of the report from the Commerce Department on Monday were upbeat and suggested that consumer spending ended the third quarter with strong momentum, which should provide a boost to economic growth despite anticipated drags from weak exports and a struggling housing market.

“The net result still appears to be a fairly strong quarter for consumer spending growth,” said Jim O’Sullivan, chief U.S. economist at High Frequency Economics in White Plains, New York.

Retail sales edged up 0.1 percent last month after a similar gain in August. Economists polled by Reuters had forecast retail sales increasing 0.6 percent in September.

Retail sales in September rose 4.7 percent from a year ago.

Excluding automobiles, gasoline, building materials and food services, retail sales jumped 0.5 percent last

month after being unchanged in August. These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product.

Consumer spending, which accounts for more than two thirds of U.S. economic activity, is being driven by a robust labor market, with the unemployment rate near a 49year low of 3.7 percent. Tight labor market conditions are gradually pushing up wage growth.

Consumption has also been supported by the Trump administration’s $1.5 trillion tax cut as well as higher sav-

ings. However, economists said the stimulus from the tax cuts was fading and many expected consumer spending to slow sharply in the fourth quarter.

Some also worried a recent stock market sell-off had dented household wealth, which could hurt spending.

“We believe lower tax withholdings provided meaningful lift to consumer spending growth so far this year, but that the incremental support to growth from taxes should be fading,” said Michael Feroli, an economist at JPMorgan in New York.

“We look for a more mean-

ingful deceleration (in consumer spending) in the fourth quarter.”

Solid economic growth Economists are estimating that consumer spending grew at an annualized rate of about 3.5 percent in the third quarter, which would be slightly below the 3.8 percent pace logged in the April-June period. Solid consumer spending should help to offset the impact on the economy from a widening trade deficit and persistent weakness in the housing market.

Growth estimates for the third quarter are above a 3.0 percent rate. The economy

Global retail update

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nline platform Shopify has opened its firstever physical outpost in the US, WH Smith restructures its high street business, Ikea trials a tiny format in London and Russia’s X5 Retail bets on a ‘lab store’ to test new technologies. Meanwhile, German discounter Lidl added the 28th country to its growing network with the launch of 16 stores at once.

Below are the updates Racy investment US & Latin America: Walmart has deepened its foray into the fashion world, with the acquisition of online lingerie retailer Bare Necessities.

This is the retail giant’s second apparel-based investment this month. Check out this analyst’s thoughts on why Walmart is spending big.

Food delivery: Despite a failed pilot with Walmart, rideshare service Uber is set to take another crack at the grocery delivery game with its CEO claiming it is the ‘next logical step’ for the business.

Meanwhile, predictions are rife that when it comes to market dominance of the grocery delivery sector, Walmart could overtake Amazon.

Natural focus: Carrefour Brazil has plans to double its

sale of organic products by 2020 by investing in specific aisles, in-store visual stimulants and a wider range of brands. Currently, organic products account for 0.6% of total sales in Brazil. Carrefour intends to spend EUR 416.3 million in the Latin American country in 2019.

Stepping down in Europe: German electronics retailer Ceconomy, which runs more than 1,000 Media Markt and Saturn stores in countries across Europe, said its chief executive will leave with immediate effect and it will also look for a new finance chief after its shares tumbled on a string of profit warnings.

Plummeting profits : French sporting goods retailer Decathlon posted a disappointing GBP 8.4 million loss in the UK as it struggles with increased

competition from supermarkets. Meanwhile, toy retailer Hamley’s saw profits nosedive 500% last year, blaming Brexit and terrorism for the devastating GBP 12 million loss.

Taste of Japan: Tesco has launched a pilot scheme with restaurant group YO! Sushi to trial staffed counters in two of its UK stores. Each kiosk which will prepare custom sushi orders for customers, as well as stocking the food-to-go cabinets.

Fundraising quest : Struggling Irish-Swiss bakery firm Aryzta plans to raise EUR 800 million in equity to repay debt and put the business back on a profitable growth path. Shareholder Cobas Asset Management is opposing the move.

Dramatic loss in Asia: Chinese tech giant Tencent has lost USD 250 billion in

market value this year. The shocking 44% drop makes the e-commerce conglomerate’s losses worse than any other company and demotes Tencent from the list of the world’s top 10 largest companies.

Holiday shopping: Amazon’s customer base has surged in India, with three times the number of people signing up to shop during the festive season than in previous years. While both Amazon and Walmart owned Flipkart jockey for dominance amid the Indian festivities, small side-lined e-tailers are trying to piggyback off the success of the major platforms.

Grooming talent : Alibaba’s Jack Ma plans to open an institute to train tech entrepreneurs in Indonesia.

Although a launch date has yet to be set, the goal is to train 1,000 tech leaders annually for the next 10 years.

Expanding empire in Europe: Germany’s Lidl has arrived in Serbia and opened 16 stores in Belgrade and other cities across the Balkan nation. Click here for pictures of the stores (captions in German). In its home country, the discounter has sealed a deal with Bioland (paywall, in German), a major organic food association.

grew at a 4.2 percent pace in the second quarter. Growth prospects for the July-September quarter were bolstered by a second report from the Commerce Department on Monday showing business inventories rose 0.5 percent in August after increasing 0.7 percent in July.

Inventory investment is expected to contribute to GDP growth after a liquidation of stocks sliced 1.17 percentage points from output in the April-June quarter.

Strong economic growth likely will keep the Federal Reserve on course to raise interest rates in December.

The U.S. central bank hiked rates last month for the third time this year. Tightening monetary policy has roiled financial markets in recent days.

U.S. stocks were trading lower on Monday. The dollar was marginally weaker against a basket of currencies, while U.S. Treasury yields rose. Last month, auto sales surged 0.8 percent after declining 0.5 percent in August. Receipts at clothing stores rebounded 0.5 percent after tumbling 2.8 percent in August. Online and mail-order sales soared 1.1 percent in September

after rising 0.5 percent in the prior month.

There were also strong increases in receipts at furniture, hobby, musical instrument and book stores as well as electronics and appliances outlets. But Americans cut back on spending at restaurants and bars, with sales dropping 1.8 percent.

That was the biggest decline since December 2016 and followed a 0.3 percent rise in August.

While the Commerce Department said it was impossible to determine the impact of Hurricane Florence on the data, disruptions caused by the storm could have hurt sales at restaurants and bars last month.

“Retail sales for food services and drinking places may have been impacted by the hurricane in September, as consumer confidence remained solid during the month,” said Ellen Zentner, chief U.S. economist at Morgan Stanley in New York.

Sales at building material stores nudged up 0.1 percent in September. Receipts at service stations fell 0.8 percent, likely reflecting a moderation in gasoline prices. * Culled from Reuters

International Drink Festival 2018 to showcase over 200 brands across Africa

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his November, is the perfect time to discover something new with drinks and brands from around the world. The second edition of the annual and highly anticipated International Drinks Festival will hold in Lagos, Nigeria, showcasing over 200 brands across Africa.

Organized by Balmoral Group, a 360 events solutions company, the 2018 edition of the International Drinks Festival will serve as a platform to bring together major stakeholders in the drinks industry in Nigeria and other parts of Africa.

Riding on the success of the 2017 edition which had over 18,000 attendees from across different components of the drinks value-chain ranging from major drink brands, consumers, distributors and government regulatory agencies like NAFDAC, Customs, FIRS etc. the 2018 edition promises to raise the bar a notch higher.

Holding from Thursday, 29th November to the 2nd of December, 2018 at the prestigious Federal Palace Hotel nestled in the heart of Victoria Island, this event will expect over 200 brands expected and double the foot-fall from last year’s maiden edition. This year’s event comes with an

exciting line up of both Business Focused activities and Consumer focused activities designed to make it a truly memorable festival.

The four-day extravaganza will be an interesting platform for mixologists, professionals in the hospitality industry, nightlife and entertainment connoisseurs, hotel owners and managers, brand managers and ambassadors, buyers, bartenders, restaurant and bar managers, bottling companies, service providers and other drinks stakeholders.

Major distributors from all parts of Nigeria as well as major stakeholders will be present, to meet with brands representing every sector of the industry. The festival will also feature masterclasses, networking, exhibitions, purchases, food and drink tasting and a series of events.

Speaking on this year’s edition of the world class festival, Ezekiel Adamu, CEO of the Balmoral Group, said “It is with great pleasure we announce the 2nd annual International Drinks Festival taking place in Lagos this year. After a successful event last year, we look forward to carrying on the conversation, engaging more brands and connecting brands and their consumers.”

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Synergitrust unveils e-commerce platform in Nigeria

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ynergitrust, one of the top social marketing platforms, has unveiled its e-commerce integrated system in Nigeria with the aim of taking online shopping to the grassroots.

The unveiling which was held at Royal Event Centre, Ikeja on Tuesday had the brand’s strategic partners in attendance.

To ease the process of business transaction on the platform, Synergitrust entered into partnership with Interswitch, MTECH, and FEDEX/Red and other reputable institutions in the country.

Synergimart Digital Marketing Limited, the operators of Synergitrust, is an IT driven global marketing company operating from Lagos, Nigeria.

Speaking at the event, Olumuyiwa Ojo, managing director/CEO, said the social marketing network, will bridge the gap between the buyers and sellers. ‘‘Synergitrust is a global marketplace where buyers meet sellers in a socially friendly online environment,’’ he said.

To enjoy the huge benefits of the social platform, the individual is required to register and become a member.

“Thereafter, you can tap into business opportunities therein and successfully carry out transactions

L-R: Muyiwa Ojo, MD/CEO, Synergitrust Digital marketing Limited; chairman, Synergitrust Digital marketing Limited, Okey Ogunjiofor; Guest, Sesan Kuti; Guest, Yetunde Kuti, and Tunde Meshioye, director Synergitrust Digital marketing, during the unveiling of Synergitrust digital marketing on Tuesday in Lagos.

without necessarily being physically present to initiate them,” said Ojo. Okechukwu Ogunjiofor, chairman of the company, who was present at the event, assured the public of the company’s highest level of professionalism.

“This company is guided by the core values of trust, integrity and excellence.

Trust is our second name, “said Ogunjiofor.

“We will do everything to project the brand and Nigeria in a positive light to the world. We encourage everyone to deal freely with the company.”

He said the company is set to fulfil her vision of becoming the foremost global marketing company which is driven by technology. ‘‘Within the next five years, the company will take her rightful position in ecommerce world,” he added.

Synergitrust is a disruptive innovation and robust ecommerce system designed and developed on B2B, B2C and C2C e-commerce business models. ‘‘It has three main components that are combined together. They are Synergitrust Business Club, Synergitrust Merchants and

Synergitrust agents,’’ said the managing director.

The Business club members form community of buyers on the platform while Synergitrust Merchants are product owners, manufacturers, importers, service providers and general merchants, who are sellers on the platform.

“Since Synergitrust is set to take online shopping to the grassroots, we have the third category of people called agents, who will work together with the company to create a new tribe in ecommerce,” he said.

“One of the attractive

Living under poverty line

features of Synergitrust Business Club is the financial empowerment. As a registered member of the online business club, one stands to earn residual income through a highly improved referral system. Members are encouraged to introduce the club to potential members and refer them,” he explained.

However, Ojo says referral of members is not compulsory but encouraged in order to earn more financial compensation for telling people about the business.

“In Synergitrust, whether you refer or not, you will

earn residual income on the system. Part of the earnings is used for general purchases on the platform while the other part can be cashed out to local banks. This is what encourages Merchants to join us knowing fully well that sales is guaranteed on the platform,” the managing director said ‘‘The company is on vigorous recruitment exercise to engage a minimum of 5,000 Agents to cover Nigeria, thereby creating a minimum of 20,000 jobs in Nigeria alone.’’

Synergitrust is designed to reach the unbanked, a cashless system that are riding on the existing financial institutions such as banks and payment processing companies, according to the chairman. ‘‘All stakeholders operating within the system such as buyers, sellers and agents must have bank accounts to receive commissions or sales proceeds from the in-built wallet system,’’ he said.

The company says it is taking online shopping to the grassroots and in the process creating a new tribe in e-commerce.

“With Synergitrust, you can buy, sell, make money and do lots more. The fun of online shopping has moved to a new address www.synergitrust.com,” the managing director said. “Synergitrust is set to change many lives around the world for good.”

How Nigerians are struggling to survive

If you want to contact the writer of this story call: +234(0) 803 889 1567, +234(0) 8155184838 chinwe.agbeze@businessdayonline.com

Teacher in dire need of funds to undergo hip replacement Name: Godwin Adanon State of Origin: Lagos State Age: 26 years Dependents: None Occupation: Teacher I used to teach Music at Christabel Nursery and Primary School, Oshodi. I also taught Music in College Best Secondary School but I quit teaching in schools in 2015 when I started experiencing a severe hip pain.

I have had issues with my left leg for a long time but sometime in 2015, I discovered that each time I stood up to teach, the pain at the hip was always severe.

What did you do when you noticed the severe pain?

I went to General Hospital, Isolo, for diagnosis. I was referred to Ikeja General Hospital for X-ray. After the X-ray, I was told I needed a surgery. The doctor said my

I have not taken any treatment. The doctor advised me to be using crutches to avoid total breakdown of the hip since I don’t have the money for the surgery. I also have to use the crutches each time I want to go out to reduce the pain on my leg.

I have had this issue for long and I usually take Renaf Plus and other painrelieving drugs prescribed by my doctors. I take the drugs once in two days just to calm the pain and it lasts for a week, after which the pain would come up again.

If that happens, I rush and get the drugs.

How have you been coping since you noticed this in 2015?

I had to stop teaching Music in schools. I only teach a student Music at home on Saturdays and I’m paid N15, 000 a month. I used that

entire hip has gone and must be replaced.

The bill I was given was huge so I went to my pastor for prayers. One of the leaders in my church raised N50, 000 for me and another leader from another church raised N50, 000, making it N100, 000. Since then (February 2016) till now, no more money has been raised.

What is the cost implication?

The bill I was given by the Lagos State University Teaching Hospital (LASUTH) on the September 30, 2016, was N823, 000 for the hip replacement, but recently, I went back to the hospital and was told I needed about N1.4million which will cover the surgery, admission bill, drugs, and blood.

Have you taken any treatment since then?

Analyst: Chinwe Agbeze, Graphics: Joel Samson

money to support myself.

My family are poor and could barely feed themselves let alone help with my medical bill. I still support them with the little I make.

I cannot go far with the crutches. Sometimes, I have to trek from my house to the junction to catch a bus and that usually gives me a tough time. I discovered that each time I walk the bones at my hip rub against each other and that gives me serious pains at the hip.

Each time I’m walking, the hip generates pain. The best thing I was told is to do the surgery.

This hip problem has caused me so much pain.

It’s hard for anyone to know what I’m going through but whenever I’m alone, I cry so much praying that God will raise men to help me do this surgery.

Thursday 18 October 2018

BUSINESS DAY

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Investor

29

In association with

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

Year Open

38,243.19

Market capitalisation

N13.609 trillion

NSE Premium Index

The NSE-Main Board

NSE ASeM Index

2,564.13

1,713.69

1,087.32

Week open (05 – 10–18)

32,383.15

N11.822 trillion

2,318.83

1,449.69

797.69

Week close (12– 10–18)

32,456.98

N11.849 trillion

2,328.43

1,450.66

787.68

Percentage change (WoW) Percentage change (YTD)

0.23 -­15.13

0.41 -­9.19

NSE Lotus II

NSE Ind. Goods Index

NSE Pension Index

330.69

2,560.39

1,975.59

1,379.74

755.90

290.93

2,241.30

1,523.31

1,221.06

750.49

288.37

2,248.85

1,528.38

1,226.69

NSE Banking Index

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

1,746.68

475.44

139.37

1,457.49 1,461.89

408.57

124.01

411.93

121.89

NSE 30 Index

0.07

-­1.25

0.30

-­15.35

-­27.56

-­16.30

0.82 -­13.36

-­1.71 -­12.54

976.10

-­0.72 -­23.11

-­0.88

0.34

0.33

-­12.80

-­12.17

-­22.64

0.46 -­11.09

Nigerian Stock Exchange still shelters 16 companies with locked-in shares IHEANYI NWACHUKWU

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o fewer than sixteen (16) listed companies on the Nigerian Stock Exchange (NSE) have their shares still locked in the hands of investors with controlling interests.

The portion of shares that is publicly traded is the ‘free float’ of the company.

At the Nigerian stock market, large chunk of these companies’ shares are still not open to public trading as they are held by the promoters. When a company issues shares, not all of them are made available to the public for trading.

What are th e re g ulator y requirements?

The NSE free-float requirement for companies on the Alternative Securities Market (ASEM) Board is 15percent of their market capitalization. For companies listed on the Main Board, their free-float is 20percent of their market capitalisation. While the freefloat of companies on the Premium Board is 20percent of their market capitalisation or above N40billion on the date The Exchange receives the Issuer’s application to list. In order to ensure that there is an orderly and liquid market for their securities, listed companies on the Nigerian Stock Exchange are required to maintain a minimum free float for the set standards under which they are listed.

The free-float deficient companies on the Nigerian Stock Exchange The companies with free-float deficiency are A.G. Leventis Plc, Capital Hotel Plc, Caverton Offshore Support Group Plc, Champion Breweries Plc, Ekocorp Plc, e-Tranzact International Plc, Great Nigeria Insurance Plc, Infinity Trust Mortgage Plc, Interlinked Technology Plc, The Tourist Company of Nigeria Plc, Transcorp Hotels Plc, Union Bank of Nigeria Plc, Portland

Paints & Products Nigeria Plc, Global Spectrum Energy Services Plc, CWG Plc, and Aluminium Extrusion Plc. Most of these companies with free float deficiencies have applied for waivers from the Quotations Committee of the NSE management and specifically provided compliance plans with tentative timelines to support their requests.

Their free float and compliance due dates A .G. Leventis Plc has just 11.64percent of its shares in the hand of the investing public and was given till October 19, 2020 to comply with the NSE rules; while Capital Hotel Plc, a company under regulatory watch has just 2.99percent of its shares in

the hand of the investing public.

The company was given till last year (October 31, 2017 precisely) to comply.

Caverton Offshore Support Group Plc which has only 17.30percent of its shares in the hands of the investing public was also given till October 31, 2017 to comply. Champion Breweries Plc which is currently restructuring has just 17.17percent of its shares in the hand of investing public.

Others are Ekocorp Plc with just 11.84percent of its shares in the hands of the public. The company was given till October 31, 2017 to comply with the free-float requirements. E-Tranzact International Plc has only 10.06percent of its shares in the hands of investing public.

The Nigerian Stock Exchange gave the company till May 17, 2019 to

comply. Great Nigeria Insurance Plc has only 16percent of its shares in the hands of the public and was given till May 18, 2020 to meet up with the freefloat requirement.

Another company that has its shares locked up in the hands of investors with controlling interest is Infinity Trust Mortgage Plc which has just 3.50percent of its share in the hands of investing public.

The NSE gave it till May 17, 2021 to comply with the requirements.

While Interlinked Technology Plc with just 14.50percent of its shares in the hands of investing public was given till October 14, 2017 to comply.

Another free float deficient company is The Tourist Company of Nigeria Plc with just 3.58percent of its

shares in the hands of investing public.

The Company is under Regulatory Watchlist and it is currently in the process of delisting its shares from the Nigerian Bourse.

Other companies with deficient free float include Transcorp Hotels Plc which has 6percent of its shares in the hands of the public; it has till May 18, 2020 to comply with the Exchange’s rules; Union Bank of Nigeria Plc has 14.94percent shares free float and has May 18, 2020 to comply.

Portland Paints & Products Nigeria Plc has just 14.57percent of its shares in trading by the public and the NSE did not provide any answer on the company’s compliance due date. Same applies to Global Spectrum Energy Services Plc (7.01percent); CWG Plc (15.97percent); and Aluminium Extrusion Plc which has 17.73percent of its share held by the investing public.

Possible implications to watch Experts flag some issues related to low free-float stocks. There are very few that are good for investment.

Typically, shares with a higher float are associated with better governance since the promoters have lesser influence and other shareholders have more power to exercise their rights. The stocks with a low public float are open to the promoters’ whims. The lack of required liquidity makes the shares of a company unattractive.

Free-float deficient stocks can be good investment bets because their prices can move up quickly.

If such stocks attract the attention of even few investors, the demandsupply mismatch can push up price –a possible mispricing of the stocks. On the other side, if the company does not follow the rule of a minimum free float as prescribed by the market regulators it stands the chance to buy back its shares at a premium to the existing price and de-list from the exchange if it likes. This can yield a windfall for the investor.

30

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Thursday 18 October 2018

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WEEKLY REPORT United Capital investment views

NSE-ASI defies global equity rout; up 0.2% week-on-week STOCK MARKET REPORT FOR OCTOBER 12TH 2018

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lthough the domestic bourse saw a mixed theme during the week, the main equity index rose by a marginal 0.2percent week-on-week (w/w) to close the week at 32,457 points.

The market declined on two of five trading days while market capitalization accreted N26.9billion to N11.8trillion.

Thus, year-to-date (YtD) return recuperated to -15.1percent.

Activity level was buoyant as average volume traded inched higher by 14.6percent to 183.2million units while average value traded edged higher by 0.3percent to N1.97billion.

Three of the six sector indices tracked advanced while the other three declined for the week.

The Banking (+0.8percent), Industrial Goods (+0.3percent) and Agriculture (+2.7percent) sector indices closed the week unscathed consequent on bargain hunting in FBNH (+2.3percent), FIDELIT Y (+3.9percent), Z E N I T H ( + 3 p e rc e n t ) , C A P (+15.9percent) and OKOMUOIL (+9percent). On the flip side, the Insurance (-1.7percent), Oil & Gas (-0.9percent) and Consumer Goods (-0.7percent) indices weakened w/w as price d epre ciatio n in MANSA R D (-7.7percent), AIICO (-7.2percent), FO (-8.4percent), ETERNA (-2.4percent), HONYFLOUR (-9.9percent) NB (-1.9percent) and INTBREW (-1.5percent) dragged the indices.

Investors’ sentiment remained weak, closing the week at (0.9x), p re v i o u s l y 0 . 9 x ; 2 9 s t o c k s advanced while 32 declined w/w. With the pervading risk-off sentiment across the globe and the expectation of nine-month 2018 earnings, we expect a mixed theme this week.

Money Market: CBN remains dovish in money markets; netrepays N28billion At the short end, markets remained sufficiently liquid as the CBN effectively netrepaid N28billion; taking out only N249.1billion (stop rates – 6months : 12.5percent and 12months: 13.5percent) via its weekly OMO auctions, relative to N277.1billion maturities).

Subsequently, money market rates were held down at a weekly average of 11.7percent (compared to 10.9percent in the preceding week). Meanwhile, a choppy theme guided trading sentiment in the T-bill market ; liquidity sentiments and profit-taking activities that were recorded as players repositioned ahead of the Thursday OMO auction.

Overall, yields on benchmark NTB papers inched higher by 23bps on average to close at 13.8percent: 91-day (up 11bps to 12.8percent), 182-day (down 9bps to 13.3percent) and 364day (up 34bps to 15.2percent).

In this coming week, expected maturities should rise to N494.8 (split between OMO maturities of N347.1bn which implies a likely OMO auction on Thursday) and NTB maturities of N147.6billion (with an expected NTB auction on Wednesday as the FGN will look to roll-over all maturing bills).

We expect the tempo of these events to guide trading sentiments through the week.

Bond Market: Players price in expectations of renewed bond supply The Debt Management Office (DMO) released its bond issuance calendar for fourth-quarter (Q4) 2018, which showed a circa N66.6billion – N156.6billion increase in its planned borrowings for Q4-18 compared to the N203.3billion that was borrowed in Q3-18. In another development, President Muhammadu Buhari

A total turnover of 915.856 million shares worth N9.835 billion in 14,033 deals were traded this hasbywritten Senate, seeking continue putmillion pressure on FX week investors onthe the floor of the Exchange in contrast to a total of to 639.317 shares valued the approval for the issuance of reserves and the local unit. at$2.8bn N7.842 billion that exchanged hands last week in 10,477 deals.

Eurobond for the partial Global equities close lower financing of the 2018 budget

on rising US Treasury Yield

deficit. successfully financed, weekchart started off withmillion IMF’s The FinancialIfServices Industry (measured by volume) ledThe the activity with 739.343 it would tip the NGN-USD debt announcement of a downward shares valued at N6.374 billion traded in 7,447 deals; thus contributing 80.73% and 64.80% to the mix to 62:38 (from 64:36 in Q1- revision to its initial global 18), gearing to the The growth forecast for 2018 as with trade total equity turnover very volume closely and value respectively.

Consumer Goods Industry followed FGN’s indicated fiscal desire of sharper than expected 65.480 shares worth N2,044 billion we in 2,772 tensions, deals.The third wasand Conglomerates 60:40million by 2019.

Nevertheless, interest rateplace hikes the strain Industry with a turnover of 32.097 million worth N65.363 million in 491 deals. highlight that global ratesshares have on emerging economies were increased since the last Eurobond issuance in February; the Fed

cited as downside risks to global growth, hence the revision from

Trading the Top Three Equities namely $ Royal Plc, Guaranty Trust3.9percent.

Bank Plc and First has inconsistently delivered on Exchange 3.7percent from Also, 427,419 millionmarket shares worthvelocity N 4.082 City Bank Plc, (measured volume) itsMonument promised rate hikesbyand USaccounted theforUS bond benchmark 10-year Treasury yield the recent billion in 1,461 deals, contributing 46.67 % and 41.51% (indicated to the total equitybyturnover volume andspike value in recently touched a 7-year high.

US benchmark 10-year Treasury respectively.

Thus, we would expect clearing yield), spooked markets globally

rates at the proposed Eurobond as it underscored the possibility of auction to be much higher than higher corporate borrowing cost, previous auctions. dampening market sentiments.

Equity Turnover - Last 5 days In the secondary market, Consequently, the S&P 500 and trading sentiments were guided DJIA declined 4.8percent w/wand Turnover Traded Advanced Declined Unchanged by reactions to the releasedTurnover Q4 5.1percent w/w respectively, while Dateauction Dealscalendar Volumeas players Value (N) the Stocks Stocks NASDAQ Stocks index Stocks bond tech-laden priced of renewed 08-­‐Oct-­‐18 in expectations 2,662 120,822,125 1,337,704,321 shed 102 3.9percent 16 w/w11 on declines

75 bond supply at the next FGN bond in GOOGLE (-4.5percent w/w), 09-­‐ O ct-­‐ 1 8 2,832 349,526,910 1,463,906,494 110 20 21

auction. Overall, FGN bond yields which announced its intention69 to edged higher marginally by 5basis shut down its social18 networking

2,760 134,568,772 1,935,750,159 108 21 69 10-­‐ O ct-­‐ 1 8 points (bps) on average driven platform, Google+, due to a by 2021 technical 11-­‐Oincreases ct-­‐18 2,857 in maturities 148,527,210 2,859,189,133 109 glitch 15 which 17 reportedly

77 (+30bps), 2028 (+15bps) and the leaked private information of 12-­‐ O ct-­‐ 1 8 2,922 162,410,957 2,238,718,977 100 16 18

66 2034 (+12bps). The average yield some users. for FGN Eurobond inched higher European markets were not to 7.2percent from 7percent left out of the bearish theme, even while average yield in corporate as the European Commissioner

Eurobonds eased to 8.8percent from 9.1percent. Looking ahead, we expect proceedings to be guided by inflation expectations. further in yields ForOverall, Further Inquiries Contact:upticks Market Operations Department are probable towards the yearend, amid renewed bond supply, inflationary pressures, relatively w e a ke r g row t h, t h e g l o b a l tightening in liquidity, rising bond yields and added political risks as we near the February 2019 presidential election.

Foreign Exchange: Naira depreciates across all FX windows In the Foreign exchange market, the naira weakened against the US dollar during the week as pressure on naira continued to mount amid foreign capital reversals. Meanwhile, the CBN sustained its weekly FX intervention in the wholesale and retail FX market in a bid to support the naira amid growing demand for FX. This act further pressured the nation’s FX reserves down to $43.4bn, as on Wednesday.

Notably, despite Brent oil trading above $80/b throughout the week, Nigeria’s crude oil sales slowed on the back of an overhang in unsold cargoes. Overall, parallel market rate settled at N360/$1 - down by 14bps, while rates at the Interbank and Investors’ & Exporters’ FX window depreciated marginally by 2bps and 8bps to finish at N306.5/$1 and N364.1/$1 respectively. Looking ahead, we expect the sustained weekly FX intervention by the CBN to

for Economic affairs hammered on the need for Italy to cut down on its state debt. Elsewhere, the Japanese Prime Minister hinted that the United Kingdom will Page 1 be ‘welcomed’ to the Trans-Pacific Partnership amid tight BREXIT negotiations. Consequently, Pan European STOXX (-4.4percent), UK’s FTSE (-4.2percent) and Italy’s MIB (-5.2percent) all trended southwards w/w.

In Emerging Markets, politics remained at the forefront in Brazil as the first-round election that took place during the week, ended without a majority winner.

Hence a rerun was scheduled to hold later in the month.

Meanwhile, China continued to ramp up efforts to mitigate the impact of trade tariffs on her economy as the People’s Bank of China (PBOC) lowered the required reserve ratio for lenders. On another note, the South African finance minister resigned on graft allegations, while Pakistan’s finance minister announced that the nation would be borrowing from the IMF for the 13th time in the country’s history as the country continues to battle with economic challenges and balance of payment crisis.

Overall, Pakistan’s KSE100 index slid 4.4percent w/w, while Brazil’s IBOV rose 0.7percent w/w. Also, Russia’s RTSI (-1.5percent), China’s SCHOMP (-7.6percent) a n d S o u t h A f r i c a’s J A L S H (-1.9percent) all declined w/w.

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

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

E-mail: iheanyi.nwachukwu@businessdayonline.com

Corporate acquisition appetite at four-year low –survey IHEANYI NWACHUKWU

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o r p o r a t e acquisition appetite is at a f ou r- ye a r l ow despite 2018 being on track to become a near-record year for the number of global mergers and acquisitions (M&A), according to the 19th EY Global Capital Confidence Barometer (CCB), a biannual survey of more than 2,600 executives across 45 countries. The survey notes that deal plans are subdued in part due to increasing geopolitical concerns.

With rising regulatory uncertainty, and ongoing trade and tariff negotiations — including Brexit talks and the US-China trade disputes —are weighing-in on M&A sentiment ; 46percent of respondents cite regulation and political uncertainty as the biggest potential risk to dealmaking in the next 12 months. Only 46percent are now planning to acquire in the next 12 months — down from 56percent a year ago.

H o w e v e r, M & A imperatives and

ma c ro e c o n o m i c fundamentals remain robust, with 90percent of resp ondents exp e cting the global M&A market to improve and 9percent expecting it to remain stable in the next 12 months.

The majority of executives (85percent) believe global economic growth prospects are improving, with only 2percent predicting shortterm market stability to decline and 2percent predicting equity valuations to deteriorate.

As a result of portfolio re v i e w s, n e a r l y t h re e quar ters of companies (73percent) have identified assets to divest — due to underperformance or risk of disruption — indicating that other assets are coming to market and future buy-sell churn.

Some divestments could attract private equity (PE) buyers, with 31percent of executives citing PE as a major acquirer in the next year. Sixty-eight percent believe that the biggest competition they face for assets will come from private capital, including PE and

corporate investment funds.

“G e o p o l i t i c a l , t ra d e and tariff uncertainties have finally caused some dealmakers to hit the pause button. Despite strongerthan-anticipated first-half earnings and the undeniable strategic imperative for deals, we can expect this year to finish with much weaker M&A than how it started. The good news is that companies will likely take the break in action as an opportunity to focus on integrating the many deals undertaken over the past 12 months. This is likely to be just a pause, not a complete stop. Fundamentals and the strategic rationale for deals remain strong, and the appetite to acquire will likely grow toward the second half of 2019,” said Steve Krouskos, EY Global Vice Chair – Transaction Advisory Services.

“The rise of private capital, including private equity, super funds, sovereign wealth funds and corporate venture capital, has fundamentally reshaped the funding environment and will help refresh M&A activity in the future”, Krouskos.

Kalambaina: CCNN gets SEC, NSE approvals on proposed merger

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ement Company of Northern Nigeria Plc has now received the requisite pre-merger approvals from the Securities and Exchange Commission (SEC) and the Nigerian St o ck E xc ha ng e ( N S E ) for the proposed merger with Kalambaina Cement Company Limited.

Cement Company of Northern Nigeria Plc had on June 27, 2018 announced its proposed merger with Kalambaina Cement Company Limited.

The proposed merger is expected to position CCNN for better competitiveness within its home market and also enable it to utilise the more modern plant and equipment of the Kalambaina Cement Company to boost its market penetration and export potential.

Kalambaina – a wholly owned subsidiary of BUA

has 1.5 million metr ic tonnes per annum multifuel (coal, heavy oils and gas) - powered new cement plan which sits in Sokoto.

The completion of the proposed merger is subject to th e ap p rova l o f th e respective shareholders of CCNN and Kalambaina Cement and the final regulatory approvals from the SEC, The NSE, Federal Inland Revenue Service, as well as the sanction by the FHC. Under the terms and conditions of the proposed s c h e m e o f m e r g e r, a l l the assets, liabilities, licenses and undertakings of Kalambaina Cement, including employees, real properties and intellectual property rights, will be assumed by CCNN upon completion of the proposed merger. The consideration to shareholders of Kalambaina Cement will be ordinary

shares of CCNN. CCNN shares remained at N25 as at Monday October 15, 2018.

Th e s ha re e x c ha n g e ratio of 19,811,273 new ordinary shares of CCNN for every 100,000 Kalambaina Cement shares, as well as other terms and conditions of the proposed merger are provided in the Scheme of Merger Document which will be dispatched to all shareholders of CCNN and Kalambaina Cement upon receipt of an order from the Federal High Court (FHC) to convene separate CourtOrdered Meetings of CCNN and Kalambaina Cement.

The respective Board o f D i re c t o r s o f C C N N and Kalambaina Cement recommend the proposed merger to shareholders and will be seeking their support and approval at the respective Court-Ordered Meetings.

Thursday 18 October 2018

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Conoil: Q3’18 scorecard impresses IHEANYI NWACHUKWU

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onoil Plc last week released its unaudited third-quar ter (Q3) results for the period ended September 30, 2018. The result which w a s re l e a s e d ov e r t h e weekend to investors at the Nigerian Stock Exchange (NSE) showed that Conoil Plc weathered the stormy operating environment in the country.

The major petroleum products marketer reported grow ths across top-tobottom line key figures for the period in review aided by a strong growth in sales volume and a significant reduction in cost of funds.

The company’s turnover increased from N70.2billion in Q3 of 2017 to N75.8 billion in Q3 of 2018, while its profit before tax (PBT) in the same p e r i o d i n c re a s e d f ro m N2.02billion to N2.27 billion.

Conoil Plc posted an increase in its after-tax profit (PAT) from N1.4 billion recorded in Q3’2017 to N1.6 billion in Q3’2018.

Mike Adenuga, chairman, Conoil Plc had promised shareholders at the company’s last annual general meeting that conscious efforts would be directed at achieving better execution of value-added products and services to grow the business, while also assuring them that the company’s long-term future was guaranteed.

“We would continue to explore opportunities to deliver solid financial

results and increase competitive returns on our shares. Our focus would be to further consolidate our competitiveness in the industry, remain committed to explore and develop emerging markets while holding our grounds in areas where we have competitive advantage,” Adenuga said.

At N22.50 per share, the company’s share price has declined by 19.6percent this year and underperformed the Nigerian Stock Exchange All Share Index (ASI) with negative returns of minus 15.24percent. Conoil Plc shares price had reached a 52-week high of N42 and 52-week low of N21.90kobo.

In the review Q3 period, the company’s earnings per share increased from 196 kobo to 229 kobo, further raising the capacity of the company to increase dividend payment by the end of the 2018 financial

year and placing it in a good stead to fulfilling its promise to build a stronger financial position and creating higher values for its shareholders.

Conoil Plc is listed on the Main Board of the NSE petroleum and petroleum product subsector under the Oil & Gas Sector. Its market capitalisation stood at N15.613billion while shares outstanding are 693,952,117 units.

“Greater attention would be devoted to cutting operational costs in the different segments of our business, while still maintaining and improving the quality of our products and services,” the chairman noted.

In an October 12 notice released at the Nigerian Bourse, the management of Conoil Pic notified its esteemed shareholders, stakeholders and the general public of the appointment of

Hardeep Kheterpal (Indian) as the Acting Managing Director and a member of the Board of the Company.

“Kheterpal is an accomplished professional in diverse sectors of the economy including FMCG, Te l e c o m s , C o n s u m e r Durables and Organised Retail among others. He brings with him over 26 years of strong and decisive executive leadership experience at the highest levels. The appointment is made by the Board subject to further ratification by shareholders at the next General Meeting,” the notice at the NSE reads.

The leading fuel marketer also made significant improvement in its financial results by recording a 27 percent decrease in cost of operations while also reducing cost of funds by 22 percent to bolster sales and profit.

SEC, FSD Africa partner to strengthen Nigeria’s capital market

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he Securities and Exchange Commission (SEC) has become the first capital market regulator to participate in a flagship panAfrican programme designed to strengthen the continent’s capital markets.

Over a three-year period, FSD Africa, a UK Aid funded non-profit company, will provide funding to build the capacity of capital market regulators across the continent, providing world-class technical assistance, encouraging closer collaboration among regulators and conducting research to support the development of new policies and regulations.

Through the programme, FSD Africa will assist SEC Nigeria in several ways. First, it will fund an institutional capacity audit to identify strengths and areas of improvement in the SEC Nigeria’s operations as well as provide support to implement recommendations. It will also help in promoting fintech regulation. Lastly, it will play a role in encouraging greater collaboration and knowledge management sharing with other African capital market regulators.

As Africa’s largest economy, Nigeria represents a natural starting point for this new programme. In addition to

Nigeria, the programme will be implemented in Ghana, Kenya, Mozambique, Rwanda, Tanzania, Uganda, Zambia and Zimbabwe.

The cooperation agreement between SEC Nigeria and FSD Africa was signed in Lagos today. The signing was observed by the Deputy High Commissioner, British Deputy High Commission Lagos, Laure Beaufils. Other present were the heads of the two institutions; Mary Uduk, Acting Director G eneral, S ecur ities and Exchange Commission, Nigeria and Mark Napier, Director, FSD Africa.

Laure Beaufils, Deputy

High Commissioner, British Deputy High Commission Lagos commented:“Capital markets have an essential role to play to help unlock capital that can be invested in the real economy and that can contribute to job creation and inclusive growth. I am delighted that the SEC Nigeria and FSD Africa will be signing a new partnership agreement today. It is a testament to the importance we attach to this issue and to our commitment to deepen and broaden our trade and investment relationship with Nigeria. I very much look forward to working with the SEC on this in the future.”

Investor Education

Things you must not do in a bearish market

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hether you have invested in the stock market or thinking about investing, there are always some basic steps to make sure you are being smart with your money.

When it seems like the sky is falling, do your best to remain calm and remember that corrections and market downturns are normal and healthy. As an investor, you never want to make decisions based on emotions, especially fear…so first and foremost, try to remain calm.

Avoid panic-selling Consider bear market as a time when everything is briefly on sale and buy into value stocks you believe in long term. Bear market could also be an opportunity to re-balance your portfolio. The best thing would be to buy more, or at the very least hold tight. The worst thing to do is selling into a market decline if your long-term objectives have not changed.

Consider buying more stocks while prices are low, but do not give into the temptation to “panicsell.” Panic-selling is the worst thing you can do, according to Joe Mallen, chief investment officer at Helios Quantitative Research. Instead, stock

investors should look for opportunities to put unused cash into investments they have been considering.

Do not watch fixatedly Make sure you don’t watch the market closely because if investors are too worried about their stocks dropping “a little bit … and think they should maybe sell them when they go up, they are not going to have very good results.

So do not try to time the markets. During times of volatility, investing expert and “Oracle of Omaha” Warren Buffett suggests keeping a level head.

It is a natural instinct to want to reduce your exposure to assets that are declining but resist the urge. If it helps, stay away from the news.

Invest for the future Many experts recommend starting slow, remaining calm and looking at the big picture.

Many investors can feel overwhelmed by market volatility. A 2017 survey

by Ally Invest found only one in three millennials is investing in the stock market because they find it “scary or intimidating.”

While your gut instinct might be to sell certain positions while the markets are going haywire, try to take a deep breath before making any rash decisions.

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Harvard Business Review

Thursday 18 October 2018

Global Business Perspectives CONNEC TING

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A new hospitalist model for managing high-cost, high-need patients

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partnership between the Boston Medical Center and Commonwealth Care Alliance, a community-based health care organization, provides a promising new hospitalist model for inpatient treatment of “complex care” patients — patients with extensive, persistently expensive medical needs.

Complex care patients typically have complicated medical histories, functional limitations or disabilities, numerous medications prescribed by multiple outpatient providers, and social drivers of illness. Providing hospital inpatient treatment for them is challenging.

For example, the increasingly prominent hospitalist model depends on hospital-based physicians with expertise in hospital care for admitted patients. But these physicians have little to no prior experience with the patients they treat. Some data have shown that this model can lead to lower average length of stay without increasing costs, though the impact on patient-centered outcomes and total medical costs is unclear. Particularly for chronically ill patients, it is not known whether a hospital physician with expertise in complex care and understanding of an individual patient’s history can achieve better patient-centered outcomes than a traditional hospitalist.

Care delivery organizations that assume financial risk have also invested in models that improve transitions between inpatient and outpatient settings, with the goal of decreasing readmissions and other complications that come with disconnected care. For example, organizations such as CareMore have invested in “extensivists,” physicians who

travel to hospitals where CareMore patients are admitted and link the hospital stay with primary care. Extensivists aim to influence the course of treatment in the hospital and, following discharge, the transition to outpatient care, either through directly managing the patient while at the hospital or providing recommendations. CareMore credits this model with a 30-day hospital readmissions rate for Medicare patients that is 40% less than the U.S. average.

As CareMore’s results for its Medicare patients and its three-year-old program for Medicaid patients indicate, extensivists improve patient outcomes through degrees of influence over the hospital setting. Could a hospitalist service dedicated to the care of complex patients have an even greater impact?

To find out, Commonwealth Care Alliance and Boston Medical Center created a hospitalist service staffed with physicians and midlevel providers who specialize in complex care.

(Commonwealth Care Alliance offers health plans to individuals who are dually eligible for Medicare and Medicaid, and serves patients dealing with significantly more complex medical and social issues than the average population.)

This complex care hospitalist

model, which launched in July 2016, has four fundamental components.

— COMMUNICATION: The complex care hospitalist team communicates frequently with patients’ primary care teams, something that conventional hospitalists do not often do.

The hospitalist team contacts primary care providers when patients are being admitted, updates providers throughout the hospitalization and consults them when discharge planning begins. Communication occurs via email, phone and text, and is used to verify medications, patient history and social factors that may be relevant to an admission. For example, if a new diagnosis is made during the hospitalization, the primary care team is notified and asked to help deliver the news to the patient and the family — improving both the patient’s experience and the transition out of the hospital.

— CONTINUITY OF CARE: Patients admitted to the complex care service share the same hospital unit, with consistent nursing staff and a core rotating group of hospitalists. Since many of the patients are admitted at least annually, the inpatient nurses and providers are often familiar with the patients and are able to provide a continuity of treatment.

To ensure a safe discharge, a “transitions-of-care” team led by nurses coordinates the discharge plan with the hospital staff, hospitalists, primary care teams, and patients and their families in person.

— SOCIAL DETERMINANTS OF HEALTH: For complex patients, expenditures on social needs such as food and housing can have a greater impact on health outcomes and wellbeing than medical care. The complex care service trains physicians, nurses and care transitions teams in social determinants of health and how to identify patients’ social needs. For example, a patient with diabetes may also have food insecurity, leading to difficulty accessing food that will help his medical condition and resulting in more hospitalizations for diabetes. Providers in the complex care service would search for underlying drivers of the patient’s diabetes hospitalizations, then coordinate with a food bank to provide a diabetic diet when the patient returns home.

— SPECIALISTS IN COMPLEX CARE: The complex care hospitalist team employs physicians and midlevel providers with expertise in complex medical conditions. For example, the nurses on the unit receive training in how to care for patients with disabilities and functional limitations.

We’ve only began to assess the effectiveness of the effort, but initial results are promising. We conducted a preliminary chart review and examined the differences in 30-day readmission rates among all of the patients from Commonwealth Care Alliance’s primary care practice admitted to the Boston Medical Center in one month. Ten patients were admitted to the

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

complex care service; five were admitted to hospitalist/general medicine services. Patients discharged from the complex care service had a 20% 30day readmission rate and 20% went to the emergency department within 30 days after discharge; those discharged from hospitalist and general medicine services had an 80% 30-day readmission rate, and the remaining 20% of those patients returned to the emergency department within 30 days. While the population of this exploratory evaluation is small, the data support the anecdotal experiences of patients and providers with the complex care service. We are now conducting an evaluation of more than 1,000 admissions.

These initial results also suggest that some complex patients may be better served by providers more intimately connected to the outpatient setting who specialize in caring for patients with intricate medical and social needs.

Other patients may be appropriately served through an adjunct consultant, or extensivist, model. Still others, who may not need the level of expertise of either a complex care hospitalist or an extensivist can be adequately served by the traditional hospitalist model.

The challenges for value-based organizations will be how much control to exert over the inpatient hospital setting and how to match patients with the model of inpatient care best suited to their needs. But in an era where hospital costs and outcomes, particularly for high-cost and high-need patients, are more relevant than ever, the complex care hospitalist model offers an achievable option for value-based hospital medicine.

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LegalBusiness BD Business Law Industry Report Practice Intelligence Partnerships

Whiter the NITDA Data Protection Guidelines 2017? tion, or the consent of the data subject is obtained (Section 12); accuracy requiring that persons who process personal information must take steps to ensure their accuracy (Section 15 (d)); retention requiring that personal data shall be processed for no longer than is necessary (Section 15 (e)); fair and lawful processing requiring that there must exist a lawful basis for processing personal data (Section 16); right of erasure to enable data subject exercise a right of erasure (Section 17 (d)); and data portability which enable data subjects to transmit their personal data to another processing system (Section 27).

Specific types of processing relating to special categories of data The Guidelines sets out particular circumstances in which the processing of sensitive personal information is allowable. In this regard, Section 14 prescribes the conditions for the processing of personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs, trade union membership, health or sex life.

CHUKWUYERE EBERE

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owards the end of year 2017, the National Information Technology Agency (NITDA or the Agency) released a draft Data Protection Guidelines 2017 (the Guidelines) and in the first quarter of year 2018 solicited for comments regarding the Guidelines. According to NITDA, the Guidelines seeks to provide a guideline for all organizations or persons that control, collect, store and process personal data of Nigerian residents and citizens within and outside Nigeria, and to prescribe minimum data protection requirements for the collection, storage, processing, management, operation, and technical controls for information in this category.

Although, Nigeria at this time is yet to enact a data protection statute of general application, the Guidelines, no doubt is timely and a welcome development, considering the fact that the US state of California’s Consumer Privacy Act and EU’s General Data Protection Regulation (GDPR), both ambitious pieces of data protection legislations were, respectively enacted and effective in 2018.

In this opinion piece, I provide a summary of the main features of the Guidelines with the corresponding deficiency if any, then I proceed to examine the statutory basis for the Guidelines after which I make my conclusions with recommendations on how best a broadbased data protection statute may be enacted for Nigeria.

This opinion piece is not intended to be a comprehensive review of the Guidelines.

Main features of the Guidelines Material and territorial scope Section 4 of the Guidelines sets out the categories of persons covered by its provisions, and these are persons based in Nigeria, including but not limited to data controller or data administrators and data subject; and to persons based outside Nigeria if they process personal data of Nigerian residents and citizens; and the collection, accessing and processing of personal data by wholly or partly by automatic and non-automatic means. It is pertinent to note that even though this section does not expressly mention a “data processor” as being subject to the Guidelines, nonetheless, the reference to “including”, and the “processing of personal data” by a person who acts as a data processor is sufficient to trigger the application of the Guidelines so as to bring that person within its scope.

It is also pertinent to note that the territorial scope of the Guidelines

extends beyond Nigeria to persons based outside of Nigeria so long as they process personal data of Nigerian residents and citizens. In my view, it is immaterial whether the processing was done outside (or inside) Nigeria, or whether the citizen of Nigeria was physically present in Nigeria as at the time of the processing.

address, bank details, posts on social networking websites, medical information, and other unique identifier such as but not limited to MAC address, IP address, IMEI number, IMSI number, SIM and others. This definition is consistent with the definition of personal data under the GDPR and the caselaw of the EU.

Definition of personal data The Guidelines defines personal data as “any information relating to an identified or identifiable natural person (“data subject”); information relating to an individual, whether it relates to his or her private, professional or public life. It can be anything from a name, address, a photo, an email

Data protection principles The Guidelines contains robust data protection principles similar to that contained in the GDPR, and they are; purpose specification requiring that the purpose for which personal data is processed must be communicated to the data subject (Sections 6 – 7, Section 15 (a)); data minimization requiring that

only personal data required for the purpose for which it was obtained should be processed and/or collected (Section 8, Section 15 (c)); right of rectification which enables data subjects to update their personal information (Section 9); right of access which enable data subject to obtain a copy of their personal data in the custody of a data processor (Section 10, Section 17); data security requiring the adoption of cybersecurity measures to protect personal information processed (Section 11, Section 18); restrictions on the cross-border transfer of personal data unless the recipient country has a data protection legislation, there is a contractual arrangement for the protection of personal data between the data controller and recipient organiza-

Adequacy assessment Section 28 of the Guidelines establishes the elements that should be taken into account when assessing the adequacy of the level of protection in another country, and they are that the level of protection shall be assessed in the light of all the circumstances surrounding a data transfer operation or set of data transfer operations; a consideration of the nature of the data, the purpose and duration of the proposed processing operation or operations, the rules of law, both general and sectorial, in force in the receiving country and the professional rules and security measures which are complied within that country which should not be lower than the content of the Guidelines herein. The Guidelines makes it clear that a third-party country’s level of protection shall not be lower than that specified in the Guidelines, in cases where personal data is to be transferred from Nigeria to that country.

Enforcement mechanisms and penalties The Guidelines in Section 33 states that “the enforcement of these Regulations shall be by the “Relevant Authorities”. The interpretation section of the Guidelines defines “Relevant Authorities” to include NITDA or any other statutory body.

In this regard, it is unclear whether a statutory body will also include a law enforcement agency created by statute, and/or which particular relevant authority is the lead data protection authority.

It is also pertinent to state that Continues on page 35

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Thursday 18 October 2018

LegalBusiness

A foray into the prospects of the development of renewable power options in Nigeria Proem Convening a meeting of business, scientific and academic leaders in Rome, in June 2018, Pope Francis stated that the desire to ensure energy for all must not lead to the undesired effect of a spiral of extreme climate changes due to a catastrophic rise in global temperatures, harsher environments and increased levels of poverty. He also reminded business executives that civilization requires energy, but energy must not destroy civilization.

Renewable Electricity Supply Global trends in the energy sector have over the years seen a gradual incline on the reliance of fossil fuels as a major source of generation of electricity, and according to statistics released by the World Economic Forum, may do so for the next Twenty (20) years. Last year, the United States Energy Information Administration has identified the growing trends globally, and have suggested coal, oil and natural gas will still account for 77% of our energy by 2040.

Renewable Energy primarily focuses on energy sourced from the most sustainable means. Traditionally, renewable sources of energy include Wind power; Hydropower; Solar energy; Geo-thermal energy and Biomass energy. Global trends in developed nations (and more recently developing nations) have sought to diversify the energy mix by including renewable sources in a bid to encourage a more sustainable long term sourcing of energy and to gradually decrease the negative impact and degradation that these non-renewable sources have on the environment. One of the greatest impacts of renewable energy on local conditions is the ability of nations to maintain financial independence by removing the reliance on fossil fuels (and their environmental impacts) in the generation of power.

Renewable Electricity Supply in Nigeria Development of Renewable Energy (Electric Power) In Nigeria Nigeria, a country with a population of over 190 million people, has varying temperatures and natural and physical features within its 923.78 thousand sq. km land mass. The country lies within a high sunshine belt and thus has enormous solar energy and other solar related potentials and the resources in the Northern part of the country, in particular, provide a more viable potential for photovoltaic use, with insolation of up to 7 kWh/ m2/ day. Average sunshine hours in Nigeria, are estimated at 6hrs per day.

Hence, the country does have rich potentials for renewable energy (solar power production in particular).

Recent studies have suggested that Nigeria could generate over Fifty per cent (50%) of its required power needs by deploying solar PV panels on just One per cent (1%) of Nigeria’s land mass. Given Nigeria’s solar potentials, solar thermal applications, for which technologies already exist in the country, include solar cooking; solar water

heating for industries, hospitals and households, solar evaporative cooling, solar crop drying, solar incubators and solar chick brooding.

The Nigerian National Energy Policy (which came into effect in April of 2003) (the “Policy”) recognizes the use of renewable energy sources such as hydro, solar, wind, biomass amongst other sources of renewable energy sources. In particular, the Policy recognizes the need for the nation to harness the hydropower potential available in the country for electricity generation. It also recognizes the need for Nigeria to integrate solar energy (in particular) into the country’s energy mix.

Further, Nigeria’s Electric Power Policy, developed by a 23-member Electric Power Sector Reform Implementation Committee (“EPIC”), and approved by the Federal Government of Nigeria, in the year 2001 specifically states in Section 7.1 (i) that the rural electrification policy shall include a full menu of rural electrification option including grid and off-grid, minigrid, non-thermal, renewables etc.

The Nigerian Electricity Regulatory Commission (“NERC”), pursuant to the powers granted it under the Electric Power Sector Reform Act No. 6 of 2005, licensed on November 3, 2009, the first renewable power project above 1MW namely; the 5MW solar project located in Jos, Plateau State, Nigeria. The said plant is owned by the indigenous Nigerian company, Wedotebary Nigeria limited.

KEY DEVELOPMENTS RURAL ELECTRIFICATION AGENCY

In 2005, the Federal Ministry of Power, Works and Housing developed the Rural Electrification Policy (“REP”), which outlines the FGN’s objectives, goals and policies regarding rural electrification. The REP details the institutional framework and procedures to be pursued in order to achieve the objectives of the government’s rural electrification program.

One of the goals of the REP is to encourage states to develop and contribute financially to rural electrification. Thus, key steps should be taken by component Nigerian States in line with the overall objective of the FGN, in connection with rural electrification. The implementation of rural electrification programs of each component Nigerian State should as far as possible, encourage the decentralized configuration approaches (such as mini-grids and stand-alone systems) by making use of all resources (financial, technical and human) available at Federal, State and local levels.

Thus, it is crucial for each Nigerian component State to consider setting up relative governmental agencies to collaborate with the Rural Electrification Agency for the development of off-grid and mini-grid facilities within the respective states.

Indeed, the Constitution of the Federal Republic of Nigeria of 1999 (as amended) (the “Constitution”) provides for state legislation on electricity in the Concurrent Legislative List. Pursuant to item 14 of the Constitution, and the current policy of the FGN on rural electrification, each component Nigerian State will appear well within its rights to establish its own Rural Electrification Agency. Thus, each

Nigerian component State may pass legislation creating their State Rural Electrification Agency (“SREA”).

The State’s strategy can take its cue from and in collaboration with the Federal Rural Electrification Agency (“FREA”) by expanding the national grid to rural areas, development of isolated and mini grid systems, and renewable power generations. In doing this, the SREA will also take into careful consideration the provisions of the Mini-Grid Regulations which was approved by the Nigerian Electricity Regulatory Commission in 2017.

The benefits of the State taking on such onus is in the improved access to electricity in rural communities, which is likely to have a substantial effect on the quality of health services, education, and access to information, communication technology and the overall economic development of such rural communities. With reliable and reasonably affordable electric supply in place, these rural communities can develop their productive capacity in the manufacturing sector, agriculture and agro-allied services, light and heavy industries.

The relevant SREA may come up with an off-grid program that will accelerate electricity access mainly in rural areas. This program should consist of: Rural mini-grids funding: This component would fund the electrification of unserved and underserved areas that have high economic potential; Deployment of Stand-Alone Home Solutions: This component would provide Solar Home Systems (SHS) and solar lanterns, among other products, for areas where mini-grids

are not viable. The success of the MTN Lumos in the Nigerian market is a pointer to the impact such SHS’s may have in unserved areas of the country; Reliable power for Clusters of heavy demand consumers such as Universities and Hospitals from off-grid systems ranging from 1 MW to 10 MW; Grant of Eligible Customer Status from NERC for customers that utilize more than 2 MW of energy from the national grid. These classes of customers have the right to competitively purchase electricity directly from generation companies under the NERC Eligible Customer Regulations 2017.

In addition, it is crucial to note that the REA established the Rural Electrification Fund (“REF”) as a means to provide financial support and funding for the development of renewable energy and as such, remains a key source of investment for such projects.

FEED-IN TARIFFS Furthermore, the Renewable Energy Research and Development Division of NERC developed the 2015 Feed-In-Tariffs (FITs) for renewable energy (wind, biomass, solar and small hydro).

The purpose of the Nigerian Regulations for Feed-In Tariff for Renewable Energy Sourced Electricity in Nigeria is to encourage the generation of renewable energy and stimulate investment in the generation of such energy, including encouraging foreign investment; providing priority access to the grid to renewable energy; establishing an obligation to purchase renewable energy; encouraging fixed prices for renewable energy; enhancing the attainment of national targets on renewable energy and ultimately to increase the generation of power in the Nigerian economy Under the Regulations on Feed in Tariffs, the off-takers are obliged to treat as ‘must-buy’ all electricity generated by such renewable sources as specified under the regulations. It is pertinent to note the implementation of this set of Regulations is yet to be tested.

RENEWABLE ENERGY & MYTO The NERC established a methodology for determining electricity tariff in the Nigerian Electricity Supply Industry (“NESI”) and issued a Tariff Order called the Multi-Year Tariff Order (MYTO) that sets out tariffs for the generation, transmission and distribution of electricity in Nigeria.

According to the NERC, the purpose of the MYTO is to set costreflective tariffs which will allow the power sector to be properly funded and functional. The tariff methodology works as both a price cap and an incentive to the operators in the industry.

Unlike MYTO I, MYTO II takes the existence of different renewable energy sources into consideration in establishing a tariff structure. MYTO II does this, in order to encourage embedded generation, thereby reducing the load on the transmission network and reduce distribution losses associated with the network; encourage the Continues on page 36

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‘Travel ban on high-profile Nigerians a breach of constitutional rights’ - SERAP

Whiter the NITDA Data Protection Guidelines 2017?

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ocio-Economic Rights and Accountability Project (SERAP) has said that “The order banning 50 alleged high-profile corrupt Nigerians from travelling abroad without any legal basis and a judicial authorisation is clearly arbitrary, repressive and illegal, as it breaches constitutional rights and the country’s international obligations, which protect the rights to freedom of movement, to leave one’s country, to privacy, and to due process of law.”

The organization said: “A travel ban by its nature is an interference with the right

to leave one’s country. It is neither necessary nor proportionate to prevent dissipation of stolen assets or stop politically exposed persons (PEPs) from tampering with any such assets. The ban should be immediately lifted and the order rescinded.”

Presidential spokesperson Garba Shehu yesterday announced the placement of 50 high-profile Nigerians on travel ban, citing the measure as part of the implementation of Presidential Executive Order Number 6. The unnamed individuals will be banned from travelling outside the country pending the determination of their corruption cases in order to ensure that all assets within a minimum value of N50 million or equivalent, are not dissipated or tampered with.

But SERAP in a statement today signed by its deputy director Timothy Adewale said: “Rather than performing its declared objective of preventing dissipation of stolen assets, the travel ban would seriously undermine the government’s

expressed commitment to combat grand corruption and violate the country’s international human rights obligations. The travel ban will play right into the hands of high-profile corrupt officials by feeding into the narrative that the fight against corruption is targeted only at political opponents.”

The statement read in part: “The travel ban and mass surveillance will distract the authorities from taking legitimate action to recover stolen assets, effectively punish high-ranking corrupt officials and portray the government

as unwilling to embrace the rule of law in its fight against corruption, thereby making it difficult to obtain the necessary support and cooperation of countries keeping stolen assets.”

“The travel ban will also strain the government’s relationships with partner countries, on whom it will inevitably rely for vital asset recovery cooperation, undermining the effort to bring them closer. By alienating these partners, the government could lose access to important information and mutual legal assistance necessary to effectively recover stolen assets and bring corrupt officials to justice.”

“Judicial affirmation of the legality of the Executive Order 6 doesn’t grant the government arbitrary powers to impose travel ban on anyone without following due process of law.

Rather than imposing a travel ban, the authorities should take advantage of the provisions of the UN Convention Continues on page 36

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although the Guidelines tasks both NITDA and other “Relevant Authorities” with monitoring, ensuring and enforcing its provisions, it does not create an enforceable right of redress for the data subject nor an adjudicatory process in which redress may be sought. In addition, the Guidelines is silent on the compensation and/or fine that will apply where the processing of personal data is in violation of its provision(s). This in my opinion is very important in any data protection framework in order to ensure compliance and to deter violations.

The statutory basis for the Guidelines Now I turn to the statutory basis for the Guidelines. It is an elementary principle of law that any exercise of rule-making power by an administrative agency must be legitimate, that is it must be by statutory grant of authority (See Olanrewaju v. Oyeyemi (2001) 2 NWLR (Pt.697) 229). Accordingly, NITDA in exercising its power to issue guidelines on data protection purportedly relied on Section 6 of its enabling Act (the NITDA Act) in issuing the Guidelines. As an initial matter, it is pertinent to state that Section 6 of the NITDA Act contains elaborate provisions that spells out the statutory functions of NITDA and runs from (a) through (n). However, none of these provisions expressly mentions the phrase “personal identifiable information”, “personal data”, “data protection” “privacy” or “protection of personal data” as mentioned by NITDA in the preamble to the Guidelines, nor do they expressly mention any variation of these terms or equivalent terms.

In construing Section 6, it is important to note that the primary rule of interpreting laws in Nigeria is the literal rule of construction whereby we give words used in a statute their ordinary and natural meaning. The reason for this is that the literal rule of construction without doubt expresses the intention of the legislature in enacting a law (See Ugwu v. Ararume (2007) 12 NWLR (Pt.1048) 365).

According to the Court in PDP v.

INEC (2014) 17 NWLR (PT.1437) “The cardinal principle in the interpretation of statutes is that the meaning of a statute or legislation must be derived from the plain and unambiguous expressions or words used therein …. The literal rule of interpretation is always preferable unless it would lead to absurdity and inconsistency with the provisions of the statute as a whole”. The Supreme Court of Nigeria in 2017 reaffirmed the literal rule in Skye Bank v. Iwu (2017) LPELR-42595 (SC) by stating in clear terms that “The law is also well established that interpretation of statutes should always be given its ordinary meaning” and that “where [a statutory provision] is clear, unambiguous and to the point, any addition or subtraction [in its interpretation] will be sequel to introducing an illegal back door amendment” [emphasis on the underlined]. For it is settled law, that an administrative rule

cannot expand the provisions of the substantive statute, it must be within the authority derived in the main enabling Act (See Olarewaju v. Oyeyemi supra).

From the foregoing, it may thus be rightly argued that the absence of these data protection terms in Section 6 of the NITDA Act makes it unlikely that the legislature had intended to grant NITDA such authority to regulate the processing of personal data and/or issue guidelines on data protection.

Accordingly, where words used in a statute are clear and unambiguous, they should therefore be accorded their literary meaning (See Adewunmi v. A-G., Ekiti State (2002) 1 S.C. 63). In the eventuality of a legal challenge, my humble view is that NITDA cannot successfully rely on Section 6 to sustain a legal basis for issuing the Guidelines. In the final analysis, it does seem that the major obstacle to the effective enforcement of the Guidelines if ever it comes into force, would be its statutory basis which appears to be pillared on a shaky foundation having regard to the clear wordings of Section 6 of the NITDA Act. Conclusion and the way forward Due to the proliferation of personal information in several databases across Nigeria and the likelihood of the online behavioural tracking of data subjects in Nigeria, the need for the enactment of a law to regulate the processing of these personal information has never being more important. This call is coming on the heels of the unbridled access to, and use of personal information as revealed by the recent Facebook-Cambridge Analytical data scandal in which Nigeria was mentioned as a use case. Regardless of the statutory basis for the Guidelines,

NITDA’s effort in this regard is highly commendable. In terms of scope of application, the Guidelines is a significant improvement to the Draft Guidelines on Data Protection 2013 also released by NITDA, and appears to be the most comprehensive data protection framework to originate from Nigeria. In my opinion, NITDA in addition to taking steps to remedy the deficiencies of the Guidelines as highlighted above, should as a matter of urgency convert it into a Bill which should be subsequently forwarded to the National Assembly, through the office of the Attorney General of the Federation as an executive Bill sponsored by either the President and/or NITDA, or alternatively seek for an amendment to the NITDA Act that remedies these deficiencies and authorizes NITDA to make guidelines and/or regulations for the processing of personal information.

Personal data we have been severally told is the new oil. This oil is now the most valuable commodity in the digital economy and has helped to solidify the market position of some of the world’s most valuable internet companies.

National governments including Nigeria must set strict controls on how this oil is “mined” or acquired, used and transferred to another country. The state of California and EU have set a “gold” standard, Nigeria is encouraged to follow suit.

The time for this is now. As much as we love using the internet, this should not come at the cost of losing our privacy online.

Chukwuyere is a Research Fellow at the African Academy Network on Internet Policy and Senior Associate at Streamsowers & Köhn.

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Judge withdraws from Ogun PDP suit against Secondus

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ustice C.J. Aneke of the Federal High Court in Lagos on Tuesday withdrew from a lawsuit filed by the Ogun State chapter of the Peoples Democratic Party against the National Chairman of the party, Prince Uche Secondus.

The judge washed his hands off the case on Tuesday after he was accused of being biased.

Apart from Secondus, other defendants in the suit marked

FHC/L/CS/1581/2018, are the Independent National Electoral Commission, PDP, and its National Secretary, Ibrahim Tsauri.

Also joined as defendants are Elder Yemi Akinwonmi, Sikirulai Ogundele, Bode Bankole, Waliu Oladipupo and Tunde Alekuwodo.

The Ogun PDP members, who filed the suit, were Prince Segun Seriki, Chief Mrs Tuke Omotara, Nosiru Isiaka Giwa and Chief Remix Bakare.

Others were Apostle Abiodun Sanyaolu, Chief Kola Soriola and Chief Oyede Elijah.

The plaintiffs are urging the court to compel the national leadership of the PDP to recognise the Adebayo Dayo faction of the party in Ogun State, which is being supported by Senator Buruji Kashamu, as the authentic faction.

They also want Akinwunmi replaced with Seriki as the PDP National Secretary.

‘Travel ban on high-profile Nigerians a breach of constitutional...

Continued from page 35

against Corruption to seek mutual legal assistance with countries where investigations and litigation are ongoing by requesting them to apply preventive measures regarding assets covered by the travel ban.”

“The authorities should also widely publish the names of the 50 Nigerians suspected to be involved, and submit those names to the countries/ embassies of countries where the stolen assets are stashed.

The authorities should issue a risk alert on alleged corrupt assets that are likely to be dissipated or tampered with by the high-profile Nigerians, seeking the cooperation of countries keeping the assets, and reminding them of their international obligations to prevent these Nigerians from tampering with stolen assets that are subject of ongoing investigations and litigation.”

“We are concerned with the threats grand corruption and money laundering posed to the effective enjoyment of human rights of Nigerians, and agree with the authorities that grand corruption and impunity of perpetrators must be vigorously combated. But we believe that the fight against

corruption will only succeed if it is based on due process of law and respect for human rights.”

“If the objective the government seeks to achieve is to ensure stolen assets are not dissipated or that politically exposed persons do not interfere with ongoing investigation and prosecution of corruption cases, the appropriate legal response is for the authorities to pursue orders of temporary forfeiture and mutual legal assistance, and not a travel ban that would achieve nothing but violate citizens’ human rights.”

“Nigeria is a state party to the International Covenant on Civil and Political Rights, which in article 12 guarantees the right of everyone to leave any country, including their own. The government cannot impose restrictions on this right unless any such restrictions are provided by law, are necessary to protect public order, or the rights of others.

The travel restrictions on the alleged 50 corrupt Nigerians clearly do not meet these conditions.”

“All restrictions on the right to leave must be narrowly interpreted. In General Comment No. 27, the Human Rights Committee stated that any

Thursday 18 October 2018

restrictions must not impair the essence of the right and that the relationship of the norm to the exception must not be reversed.” “ The travel ban cannot achieve the objective of depriving the 50 Nigerians suspected of corruption of their ill-gotten gains. It is absolutely important that the government is guided by the provisions of Article 31 of the UN Convention against Corruption to which Nigeria is a state party, and which authorises states parties to take preliminary measures to seize, freeze or otherwise immobilise property for the purposes of confiscation/ pending investigation and litigation.”

“It is always important that the definition and interpretation of the law should be as certain as possible, and this is of particular importance in cases of corruption where citizens’ human rights may be at stake. We do not consider that such reasonable certainty can exist where the executive assumes patently judicial functions.”

“The right to leave one’s country includes a positive duty on states such as Nigeria to issue documents – as well as a passive one – to refrain from placing obstacles in the way of

A foray into the prospects of the development ...

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uptake of and stimulation of innovation in renewable technology and to reduce greenhouse emissions by reducing the reliance on fossil fuels (oil, gas and coal).

The MYTO II sets out Feed-InTariffs for four (4) major sources of renewable energy which include wind, solar, small hydro and biomass/ biodiesel plants. However, in view of the high cost of renewable energy power plants, NERC, has for five years (2012-2017), set a cap on energy from renewable sources at 10% of total energy to be wheeled and grid contracted.

The assumptions used for the determination of Feed-In-Tariffs include the installed capacity of the relevant plant, capital costs which are limited to the one-time cost of the plant including its connection cost to the grid; the fixed and variable Operation &Maintenance (O&M) cost (payable in Naira/MW/ year and Naira/MWh), capacity factor which is typically assumed to be low due to the intermittent nature of most renewable energy sources; economic cost; auxiliary requirements such as the internal use of electricity within the premises where the generating station is situate and which is based on an assumption of 1% of the power generated; the economic life of the plant which is assumed to be 20 years and its construction period assumed to be three (3) years.

In particular, it is important that the Regulation on Feed in Tariffs sets a threshold capacity from energy generated from renewable sources.

For example, the threshold for solar projects which can be governed by the Regulation on Feed in Tariffs is restricted to 5mw. Thus, the tariffs structure for on-grid projects for solar projects would have to be negotiated outside the purview of the Regulation on Feed in Tariffs.

It is expected that other renewable projects which fall outside of the Regulation on Feed in Tariffs would be negotiated under the current MYTO (that is MYTO 2015).

THE AFRICAN RENEWABLE ENERGY FUND The Africa Renewable Energy Fund (AREF) invests in small hydro, wind, geo-thermal, solar, stranded gas and biomass projects across SubSaharan Africa, excluding South Africa. The African Renewable Energy Fund (AREF) raised $ 100 million for the development of grid connected renewable energy projects in subSaharan Africa. The fund, set to be managed by Berkley Energy Africa, will be distributed to independent power producers (IPPs) for 5MW to 50MW solar, small hydro, wind, geothermal, biomass and waste gas projects.

AREF committed in March 2014 to raising an additional $10 million to $30 million for the development stage of each project stating that larger projects may be able to acquire additional funding. This represents a unique opportunity for Nigerian generators of renewable power, to tap into a collective fund for investment into renewable power projects in Nigeria.

PRACTICAL APPLICATION OF RENEWABLE ENERGY The Nigerian Airspace Manage-

ment Agency (“NAMA”) installed in April/May 2014, solar powered lights, at the domestic runway of the Murtala Muhammed International Airport (Runway 18L), Lagos.

The installation was to guarantee uninterrupted light at the runway and would cost less to maintain.

The same approach was expected to be adopted for the Runways in four other airports in Nigeria. The effort to install solar powered lighting was done in furtherance of the policy of NAMA, to provide hybrid power backup solutions in some airports in Nigeria.

The solution provided in this respect, is one which is always ‘online’ such that where there is a power failure, from the national grid, changeover time to the backup system is in milliseconds and virtually unnoticeable. The solar panels almost entirely eliminate the need to burn large volumes of diesel (automotive gas oil) for running NAMA owned generating plants at the relevant airports.

In Lagos State, there have been several instances where solar energy has been used to power street lighting in the State. This has enabled the usage of renewable sources for the generation of power; and has enabled minimal interruption of the supply of power for street lighting to key parts of the city. Furthermore, the Lagos State has taken the initiative of powering some of the markets with solar energy.

Enugu State has seen the construction of the first solar-powered estate being built by CBN Cooporative in partnership with a private sector institution. The Estate would be powered entirely by solar energy and is to provide a viable solution to the over reliance on non-renewable sources of energy.

CONCLUSION The quest for a greater reliance on renewable energy in Nigeria’s energy mix is one that every energy sector faces. Although the proportion of power generated through non-renewable means, is still a significant proportion of total power generated, statistics suggest that the generation and utilisation of renewable energy will continue to increase globally. In Nigeria, the private sector has taken advantage of several of the incentives (tax holidays and financing) provided for with the generation of renewable energy, and this has propelled increased productivity in the sector.

We believe that the role and mandate of the State REA’s is crucial to the advancement of the FREA in Nigeria, and the article has outlined several means by which this can be achieved. Indeed, energy need not destroy civilisation, and generation of power via renewable means will afford the Nigeria Power Sector, the much needed incentive to boost supply of power for residential and commercial purposes.

Ayodele Oni {ayodeleoni@ outlook.com}, a solicitor, specializes in international energy (oil, gas and electricity) investment law and policy.

He holds a mini-MBA in power & electricity. Follow me on twitter @ayodelegoni.

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GARDEN CITY BUSINESS DIGEST What NLNG wants in its N1.2bn scholarship investment in 20 yrs IGNATIUS CHUKWU & INNOCENT ETENG

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he Nigerian Liquefied Natural Gas (NLNG) company says it has so far spent N1.2Bn in the past 20 years on scholarship award to indigenes of Rivers State. Sadeeq Mai-Bornu, the Deputy Managing Director, revealed on Wednesday, October 10, in Port Harcourt during the award of the scholarship, that the venture went beyond seeking human capital boost.

A shift away from this, the DMD said the target is to create a nexus of youth leaders who would leap to the front lines of, not only economic leadership, but also transverse to other areas in society. He feels if other companies emulate the gesture of NLNG, the effect could spiral into a progressive effect.

“The more we invest in them (youth) as a company, we create a critical mass.

But first of all, if others also copy what we are doing, you would be surprised how it would just balloon in a geometric manner. We feel that in the next five years, it would be much more bigger than we have today,” he said.

To the beneficiaries however, the concern seems immediate. To Fubara Tamuna,

Sadeeq Mai-Bornu the joy of proceeding abroad in to postgraduate study in Advanced Mechanical Engineering was huge.

When Chirlie Abbey managed to complete her undergraduate programme in medicine and surgery at the university, she could not imagine the possibility of shopping for a postgraduate programme any time soon. “I am very grateful for this wonderful opportunity,” Abbey said in smiles as she joins the 11 others of the 2018 NLNG scholarship scheme. She now

joins the league of 3246 Rivers indigenes who have benefited from the company’s educational scholarship scheme.

Mai-Bornu explained that the company’s scholarship scheme is divided into post-primary scholarship (secondary education), undergraduate scholarship and postgraduate scholarship.

In all, he said since inception, 2,956 indigenes have benefited from the undergraduate category; 222 benefited from the post-primary category and 68 benefited from the post-

graduate category.

“The NLNG Post-Primary Scholarship started in 2012 to help high performing Primary six pupils in our host communities to access secondary education. The scheme started with 28 beneficiaries and in 2017, this number grew to 222 beneficiaries with a total sum of about N800 million spent to date. Some 26 of the pioneer scholars of this scheme completed their secondary education in June this year and some have been admitted into various courses in different universities,” he said.

“The NLNG Postgraduate Scholarship programme was put in place to support the emergence of Nigerian experts in such fields as Environmental Studies, Engineering, Management, Accountancy, Economics, Information Technology, Geology, Banking, Law and Medicine.

The scheme was launched in October 2012 with an annual intake of between 10 and 15 beneficiaries to study in leading universities in the United Kingdom,” he adds.

Each of the postgraduate scholars, Mai-Bornu explained, receives between USD$45,000 (N16, 200 000) and USD$67,500 (N24,300 000) yearly.

Aogo, Thou bell of salvation

Port Harcourt by Boat With

IGNATIUS CHUKWU

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t’s difficult to think of a church service in RCCG Redemption Hall Model Parish in Elelenwo near Mary Gold International School, without the man we call Daddy Tosin on the keyboard. He has become part of every worship, such that many seem to take his presence for granted. Daddy Tosin’s fingers dance on the keyboard in such professional way that many of us for years assumed he studied Music in the university. No, he studied Surveying up to the UNN and is today a Registered Surveyor but a long-standing lecturer in the Polytechnic, Bori, the foremost in the Niger Delta.

Since the days of Pastor

Rex Chukwu, Daddy Friday Madaki, and now Lara Joseph as heads of that centre, Tosin has been the bell that rings to God in Redemption Hall in Elelenwo. His name reflects everything that God may have designed him to do, and he seems to have been doing it since 20 years ago he gave his life to Christ in Christ Apostolic Church (CAC) before he joined RCCG in 2004. He is Oluwatosin, meaning ‘The Lord is enough for me to worship’. It means in the midst of many gods flocking around in his native land, his father determined that the Lord alone would be worship. Then, come and see how Daddy Tosin worships the Lord alone, not minding career, family, lures of today’s world, etc. He is always first to come and last to leave, come rain, come shine. He amazes us all. His surname, Aogo, the Bell of Salvation, is exactly so.

Daddy Tosin is the true son of the Bell of Salvation. His father has used Tosin as Bell to all those who can be saved, and who can be dragged to salvation.

Daddy Tosin serves all and expects nobody to serve him.

God looked at his ministry of selfless service and gave him a partner called Chinyeaka, God’s hand of help. Mummy Joshua is simply every word of it, helping up to personal injury and pains. Each time you look around her, there is a helpless family, a run-away child, a wayward daughter, etc, taking shelter in their home. She goes hunting down cult recruits or even waylays them on their initiation routes

to drag them out, at personal risks. Daddy Joshua allows all that.

The problem is, instead of you to see a lecturer in Daddy Tosin, you see a minister of God; instead of you to see a Registered Surveyor, you see a gospel music maestro. Every singer wants daddy Tosin to back him/her because he knows how to key you in and how to help you in transition or how to hold you when you

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Income of over 1000 school owners crashes in Rivers State he 2018/19 academic years has since kicked off but most private school owners in Rivers State seem to habour fear and panic as the response of parents towards their children’s school fees seems sluggish. So far, they seem not to make up to half of the amount they usually make by this time in the new session.

The w orst-hit s e ems to be the big schools that charge in millions of naira per year. One of the proprietors said on telephone that she has found it difficult to raise as little as N10,000 out of pocket expenses even as a CEO of a big school.

Others say students have returned without caring about paying fees. Those who insisted on fees before entering the school have found that their schools are now empty.

A BusinessDay interview with some parents and school owners disclosed a state of panic and despair.

Chuks Onuigbo, the proprietor of Destiny Academy, bemoaned that the response of parents towards the school fees of their children dropped drastically as this new academic session began.

He said; “Most parents in

my school used to pay their children fees even before the session would begin, but two weeks has already gone in this session and many have not even made attempt. I am scared of how I will even pay my workers as month ends”.

Esther Osai, another school owner, also cried out revealing her fears as this new academic session began. “Two weeks into school resumption and I have not seen most of my students. When I asked, some said that there going to school this term was under probability because they do not have money to buy school accessories let alone schools fees. This will affect my income this term as the fate of many has not been decided”.

Further speaking, a parent Mary Akubo, said that as a parent she did not have special interest in keeping her children from school but due many challenges she faced. These ranged from getting a new school uniform, buying school bag, school books and most importantly paying school fees.

She said; “Having five children in school, the bills are much on me and my husband so I have decided to come and enroll some of my children to go and acquire skills which seems cheaper and thus reducing the number of students in school.”

miss step. He is a singer’s delight.

He is a multi-instrumentalist who learnt everything on his own, from the age of nine. The issue is, he does it professionally, such that those he mentors pass any music test anywhere. He picks up any instrument including the guitar and sends the audience crazy. If Daddy Mayowa visits and takes over at the other end, we touch heaven and back. Mayowa likes to add the reggae touch. This gets Africans flying. And Mummy Lara would have to endure because she dare not stop us.

There is time for everything, especially a time to rock in the presence of the Lord.

If the church is happy, then Daddy Tosin’s home is happier, ask Mummy Joshua, the Mbaise-born lady that married him since July 2009.

For Daddy Tosin, in Christ, there is no looking back. He has made his wife to be one of the happiest in the world.

She is now a patient person who now knows how to take things step by step, and how to be a true Christian, how to be utterly transparency.

At the Poly, he stands out for never collecting from students. He is her teacher and her best friend. He allows her

to be who she wants to be, so long as she knows what she is doing. Tosin believes that without Christ, he is nothing.

Last Sunday, his fingers danced around the keyboards as his wife led in the song of grace (Grace, Grace, Grace; I see Grace. Grace, Grace, Grace; All I see is Grace). We sang and were almost transported to worlds unknown.

This keyed in the guest preacher, Pastor Tope Akinbola, who is something else on human psychology. He showed us everything about Temperaments. He also divided humans into four character plates: Sanguine (those who think in shallow ways and make events enjoyable but may be fair weather friends); Melancholy (those who think deeply but may never forgive), Polerics (those who are forceful go-getters and who see everything as a project but can also be bossy and manipulative and domineering); and the phlegmatics or something like that (those who see nothing but need for peace, who do not want to rock the boat, but who can be passive partners and even push-overs).

He said people can have a mix of these characters or can work on themselves and not have the negatives too much.

FORTUNE OKORIE, Port Harcourt

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INVESTING IN RIVERS STATE

Brick-and-mortar businesses risk failure soon – as professor of marketing releases seven prophecies ...Says over 100m Nigerians would shop online by 2030

described by the university orator as a man of many parts predicted that by 2030 (11 years from now), more than half of Nigerians (53) or about 100 million shoppers would prefer online shopping, saying already, Nigeria has 17m facebook visitors where ideas and awareness of goods and services are obtained.

Nwokah thrilled the heavily crowded audience with what he called seven prophecies from his inaugural lectures, saying the future of click-and-mortar marketing has been debated for decades because it has been changing for decades, but that the speed of change, now driven by everything from smart-phones and data analytics, has turned up the volume on that debate.

He thus predicted that the most successful retailers would be those that innovate by unifying their growing online presence with un expe-

riential physical environment (this may mean having both virtual and physical presence). He said brickand-mortar would remain a major force in retail’s future, but that regardless of how customers travel to their preferred shopping destination, that the in-store experience that awaits them would be dramatically different from the present paradigm.

Nwokah said: “Consumers in 2030 will expect retailers to leverage personal information (data they willingly hand over, no less) to deliver more customized products and offers.

Online adverts in 2030 will be more dominant through the facebook than any other social media”.

He said small scale businesses in 2030 would leverage more on clicksand-mortar marketing for customers’ acquisition and retention; and that in 2030, Nigeria internet usage statistics would increase to 53 per cent or more.

“Presumably, 50 per cent of urban dwellers in Nigeria will shop more wears and electronics from online retailers.”

Marketing strategies The lecturer showed his years of research on various marketing strategies including what he termed ‘Strategic Market Orientation’ as a set of strategies to monitor and respond to market changes, simply put. This may have made it difficult in today’s market for any organisation to dominate a product line for too long because others would respond immediately.

Academically speaking, he said, this strategy has the decision-making perspective as proposed by Shapiro in 1988, the market intelligence perspective as ensconced by Kohli and Jaworski in 1990, and the culturally based behavorial perspective focusing on long-term profitability as put forward

by Narver and Slater in 1990, the strategic perspective that focuses on ways to respond to customers’ needs as stated by Ruekert in 1992. He said a study on Market Orientation found that during the early 2000, Coca Cola became the market leader but due to hot competition from Pepsi group, the company introduced products that

no longer have access to their school, he added. Oham disclosed that the residents had earlier cried out to the state government to come to their rescue on impassable roads but that the little action that started had since stopped.

He said; “Yes, the government had tried to do something after some time it went bad again.” Now the residents are hoping for the NDDC (Niger Delta Development Commission) to come to their aid. Another resident there, Chima Ironu (a trader) said that Fifth Avenue in Ogbogoro town is one of the worst areas as far as bad roads were concerned.

According to him, Fifth Avenue has been like that for the past six years he has lived there. He said there has been no sign of road construction. The residents are crying to the government to come to their rescue.

Ogbogoro roads

IGNATIUS CHUKWU & FAVOUR ICHEMATI

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rick and mortar businesses, those that insist on face-to-face or physical contact business model, may soon suffer failure, so warned a professor of marketing, Gladson Nwokah. The professor delivered an inaugural lecture soon after his professorship at the highest rated state university in Nigeria, the Rivers State University (UST), formerly University of Science and Technology (UST).

The 59th inaugural lecture titled; ‘From Bricks-and-Mortar to Clicksand-Mortar Marketing Strategies’ seemed to be the most voluminous academic presentation (200) in the RSU in recent times.

Nwokah, who is said to be outspoken and who allegedly suffered years of delay on his way to a professor in Nigeria’s premier science and technology university, made it clear that many physical retailers continue to resist e-commerce, hesitant to venture online, fearing they would dilute their existing business model or confuse their customers. He said they had continued to ignore mounting evidence that brick-and-mortar operations without online business presence were seriously risking business failure.

He said the Internet has continues to grow as means of effective advertising and marketing, and that retailers that wanted to survive must use it.

Definitions Giving indebt definition of Brickand-Mortar business, Nwokah, who studied in the UST up to Doctorate degree before proceeding to the UK for his post-doctoral Masters degree, stated: “Brick and mortar refers to businesses that have physical processes such as stores (built of physical materials) that customers can drive to and enter physically to see, touch, and purchase merchandise”. The drawback in this, he said, was that such business can only serve those that could come in physical contact with it.

For Clicks-and-Mortar business,

Gladson Nwokah

the Emuohua-born pastor defined it as traditional businesses or companies that have decided to take advantage of the Internet to achieve online presence. “A bricks-and-mortar business would be likely to take part in business-to-business (B2B) exchanges. The introduction of the internet and e-commerce has drastically affected the way our society shops and thus the way businesses need to operate”.

He defined marketing thus: “The means by which an organization communicates to, connects with, and engages its target audience to convey the values of and ultimately sells its products and services”. The advent of the internet, he said, has made the task of connecting a fragmented target, even though this too presents incredible opportunity.

The seven prophecies The inaugural lecture who was

Governor Wike or NDDC?:

Ogbogoro community in PH cannot move about anymore due to collapsed roads PEACE CHIDIMMA ELEMUO

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y Just one week after Oyigbo residents in Rivers State cried to Gov Nyesom Wike to rescue the local council area from decayed road network, the people of Ogbogoro have joined in the call for ‘Mr Projects’ to do his magic in their area.

Ogbogoro is a town in Obio/Akpor local council area close to the Garden City. There are various communities but those in Egbelu can hardly go visit relations in Mgbara-aja and Ozodo anymore. This is because of the problem of bad roads in these com-

munities especially in Egbelu. In the face of rains, the roads have become turgid with flood thereby causing land erosion and other hazards in the community.

An interview obtained with the residents of Egbelu town, one Valentine Oham (a trader) said that Mgbara-aja Road has collapsed. He also mentioned lack of electricity as other problems facing the area.

He said many in Mgbara-aja can no longer access the town hall because of the bad road and the stagnant water there. He said it was also affecting the secondary school in the community.

Students are the worst hit as they

failed probably because they were not customer-focused.

He said the company had to introduce Fanta Lemon and Pineapple into the market to regain their lead. His research, according to him, showed that a marketing consultant must guide his client-firm in deciding on combination of various strategies but the central focus must be on the needs of the customer and better ways to satisfy these needs. This must create customer-satisfaction, which he said was the essence of marketing in the first place.

Ways to improve marketing in an organisation The expert suggested that in an organisation, there should be performance measurement systems in place to detect the impact of investment in market orientation with the aim of learning how the firm works.

He also called on the Nigerian government to ensure a stable economy and make economic policies that would enhance existing business development in the country, but advised management of companies to motivate their sales teams so that they would analyse customers’ needs, seek to satisfy them, and try to adapt the products to these needs, and react to competitor’s actions and responses.

He mentioned regular and upto-date training of the market team on product information to be given to the advertising agency so that they would have the current knowledge and skills to handle the adverts for effective enlightenment.

Conclusion The professor and chairman of the senate inaugural lecture committee series, Ikem Kris Eloka Ekweozor, summed up the effort when he said Nwokah had convinced everyone that every profession needed marketing to make it acceptable. He described marketing as a great profession and said the inaugural lecture had made a good case even though the hitches in trying to click the lecture online had shown that the internet too had issues.

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Live @ The Exchanges Nigerian stocks shed N100bn as Q3 scorecards trickle-in …GTBank reports N164.2bn pre-tax profit IHEANYI NWACHUKWU

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s third-quarter (Q3) financials of companies berth on the Nigerian Stock Exchange (NSE), investors failed to raise bets on equities market.

This is evidenced in the performance of the stock market on Wednesday October 17 as investors recorded loss worth N104billion. Only 10 stocks gained against 22 losers. The stock market’s year-to-date (YtD) returns stands at minus 15.18percent.

The Nigerian Stock Exchange (NSE) All Share Index (ASI) closed lower by 0.87percent to 32,437.35 points as against 32,722.18 points the preceding trading day. Also, the Market Capitalisation closed lower at N11.842trillion as against N11.946 trillion recorded previously.

In 2,974 deals, stock traders exchanged 240,764,583 units valued at N3.659billion.

Zenith Bank Plc, UBA Plc, Fidelity Bank Plc, Sterling Bank Plc and GTBank Plc were actively traded stocks on Wednesday at the NSE. Guaranty Trust Bank Plc recorded the highest price gain while Dangote Cement Plc stock price declined most to N205 from N200 the preceding day, down by N5 or 2.44percent. The tier-one bank’s share price increased by 0.95 percent to N37kobo which helped moderate the year-to-date (ytd) negative return to 9.2percent.

Guaranty Trust Bank Plc released its nine months result for the period ended September 30, 2018 which shows gross earnings of N337.27billion against N309.91billion in the corresponding thirdquarter (Q3) of 2017, representing an increase of 8.8percent.

Interest Income declined to N237.54billion against N248.27billion in Q3’17, down by

Lafarge Africa commercial strategy delivers strong margins in Q3’18

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afarge Africa Plc has recorded net sales of N234 billion for the nine-month period and N72 billion for the third quarter of 2018. This is an increase of 5percent over 2017 both versus the quarter and the nine-month period.

The company’s positive performance was mainly driven by strong volume growth in Nigeria and favourable pricing trends in South Africa. Earnings before tax, depreciation and amortization (EBITDA) for the third quarter increased significantly as a result of improved performance in South Africa while it was down for the nine-month period due to South Africa’s performance in

the first two quarters of 2018.

According to the CEO of Lafarge Africa Plc, Michel Puchercos: “We continued to deliver strong margins in our Nigerian business as a result of our successful commercial strategies with improved product visibility and the fast tracking of the new route to market. Our energy efficiency plan translated in increased use of Alternative Fuel and Coal. Our South African operations delivered first positive recurring EBITDA and are focused on executing its turnaround plan.’’

He further stated that the company successfully commissioned a new grinding station in Ghana with a capacity of 600KT.

Going forward, the company’s outlook for the cement market in Nigeria remains favourable in Q4. In South Africa, it expects the execution of its turnaround plan will continue to yield positive results.

All product lines are expected to contribute to the performance.

In September, the Board of Lafarge Africa PLC approved the refinancing of the shareholder loan to $293m with longer maturity and a Right Issue of up to N90bn. Speaking on the restructuring, Bruno Bayet, Chief Financial Officer of Lafarge Africa said, “the restructuring is aimed at reducing the Company’s leverage position as well as strengthening its profitability.”

4.3percent.

GTBank’s Profit Before Tax (PBT) increased by 9.5per-

cent to N164.24billion in Q3’18, up from N150.03billion in Q3’17; while Profit After Tax in-

creased by 13.3percent to N142.2billion from N125.5billion in Q3’17.

UBA third-quarter gross earnings hit N375bn, group profit reaches N79bn

NSE set to host third edition of annual market data workshop

nited Bank for Africa Plc has released its unaudited 2018 third-quarter financial results, with impressive growth in Gross Earnings, which berthed at N374.8 billion, an 12.3 percent increase when compared to N333.9 billion recorded in the corresponding period of 2017.

According to the report filed to the Nigerian Stock Exchange (NSE) on Monday, UBA’s net operating improved 1.7 percent yearon-year to N227.7 billion, when compared to N224 billion achieved in the similar period of 2017.

Amidst inflationary pressures and uncertainties undermining the business environment in Nigeria and a few other countries in Africa, UBA’s operating expenses only increased by 2.3 percent to N149.1 billion, compared to N145 billion recorded in the same period of last year. The low cost profile can be better appreciated when put in the perspective of double digit inflation rate in Nigeria. Overall, the Bank posted

he Nigerian Stock Exchange (NSE), in partnership with Sterling Bank Plc, is set to host the third edition of the NSE Market Data Workshop.

The workshop which holds on Friday, October 19, 2018 at The Civic Center, Victoria Island, Lagos is themed “Market Data: Digitization, Disruption and Financial Inclusion”.

This year’s workshop will bring together Investors, Securities Exchanges, Market Regulators, Government Agencies, Policy Makers, Market Data Aggregators, Broker Dealers and other capital market stakeholders to deliberate on the future of capital markets and financial systems in the wake of disruptive fourth industrial revolution technologies.

The one-day event, which is an exhibition style workshop, will feature presentations and panel discussions from thought leaders within the finance and technology sub-sectors. It will address the future of investing in a world of digitization, strategic partnerships for wider financial inclusion, and the need for customer centricity in digital transformation.

The event will provide businesses within the financial services sector the necessary insights required to key into innovative technology and harness it for enhanced customer experience.

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a Profit Before Tax of N79.1 billion whilst Profit After Tax stood at N61.7 billion. This profit performance puts the Bank’s annualized return on average equity at 16percent and 20percent at pretax and post-tax profit level respectively.

The Bank continues to maintain a very strong balance sheet, with Total Assets of N4.51 trillion, an impressive 10.8 per cent year-to-date rise over the N4.07 trillion total asset recorded as at December 2017. Another strong indication of the growth of the Bank and more so, acceptance of the franchise across Africa is the remarkable 16.2 percent year-todate growth in Customer Deposits, which grew to N3.18 trillion, compared to N2.73 trillion as at December 2017. The shareholders’ fund remained very strong at N509.3 billion, even as the implementation of International Financial Reporting Standard (IFRS) 9, moderated the Group’s equity by 3.8percent yearto-date.

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receipt of this notice.”

Sources have told BusinessDay that all companies that have done average turnover of more than a billion naira on their accounts are currently receiving these letters which imposes these ‘arbitrary’ taxes based on the transaction turnover in the accounts.

The arbitrariness of the tax bills being sent out have unsettled many companies and even shareholders especially of multinationals operating in the country. The potential impact on company’s cash flow of such debits is creating panic within the business community.

A CEO of a multinational company told BusinessDay of how his company was slammed with tax bill running into billions of naira. When he approached the FIRS and showed that his company has been compliant with its tax payments, the FIRS agreed but still asked that the company should at least ‘pay something.’

Activist shareholders in the US and UK are already asking the management of companies exposed to the Nigerian market to explain their exposures to the Nigerian authorities.

This is because the unexplainable tax bills that most of them are getting.

Nigerian companies have also been hit hard. Many of the top com-

panies in the country are also getting tax demands in billions. Aliko Dangote, Chairman and Founder of the Dangote Group disclosed at the FT Africa conference on October 8 that he was equally hit with a tax bill that was twice higher than the US$2 billion that the MTN Group got from the office of the Attorney General of the Federation.

Faced with an acute revenue crisis, the Nigerian government has been on a drive to improve tax collection in the country, which at six percent of GDP, is regarded as one of the lowest globally.

In a bid to improve tax compliance, the FIRS recently directed banks to freeze the accounts of defaulting taxpayers to prevent them from drawing funds, and lately the Service appointed agent banks for collection of taxes due from alleged tax defaulters.

In the letters signed by Tunde Fowler, executive chairman, FIRS and issued to appointed agent banks they were instructed to set aside the tax amount due from the bank accounts of alleged defaulting taxpayers and remit same to the accounts of the relevant tax authorities (RTAs) to the credit of the taxpayers, in full or partial settlement of the tax debts.

The action of the FIRS is raising question on “bank customer confidentiality’ a key principle in commercial banking relationship. With the FIRS

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asking banks to debit their customer’s accounts and also submit their customer’s bank details, that confidential relationship between banks and their customers is being broken.

“The FIRS has the authority to freeze accounts of tax defaulters but it has to be on the order of the court. By then, the tax liability of the tax payer must have been established. In the case tax on estimated turnover, FIRS can use best of judgment approach where there is no record on turnover but if there is record of turnover, you cannot base tax on best of judgment approach,” Cyril Ede, president, Chartered Institute of Taxation of Nigeria (CITN) told BusinessDay on phone.

Experts are also warning that FIRS arbitrary tax demands will further cool investment inflows into the country as shareholders in Multinationals get increasingly concerned.

“FIRS is foisting illegality on tax payers. A tax payer has the right to file tax returns and the FIRS is to conduct an audit if it is not satisfied with the returns.

The turnover basis is the last resort for only companies who chose not to file their returns. And only the FIRS can collect Tax based on the FIRS act. Tax collections is a core function that cannot be outsourced”,Eben Joels, partner at Stransact LLP, a US CPA and tax firm told BusinessDay on Wednesday.

The FIRS has a wide target as it claims that the data mining efforts of the Federal Ministry of Finance domiciled in ‘Project Lighthouse’ has helped

the FIRS identify over 130,000 high net worth Nigerians and companies that have potential tax underpayments.

But Tax experts believe that while Section 49 of the Companies Income Tax (CIT) Act, 2007 (as amended), Section 31 of the FIRS (Establishment) Act, and Section 50 of the Personal Income Tax Act (PITA) empower the FIRS to appoint agents for the recovery of tax liabilities; this power should be cautiously exercised and in harmony with the law to avoid negative impact on Nigeria’s business environment and ease of paying taxes.

For taxpayers, their taxes are required to be paid either based on self-assessment, administrative or audit assessments. For the agent banks, they owe their customers (the taxpayers) the contractual obligations which require protection of their confidentiality or privacy.

Tax experts at Lagos-based Andersen Tax said in their August 17, 2018 ‘Tax Alert’ that, “Section 31 of FIRS (Establishment) Act empowers the FIRS to appoint agents of tax collection but also noted that.

“Notwithstanding, the powers granted to the FIRS to collect taxes from individuals and companies, the FIRS new approach to recover unpaid taxes may not be consistent with the relevant provisions of the legislative framework in Nigeria. The exercise of control over of taxpayers’ account without regard to due process could lead to distrust on the sanctity of contracts in Nigeria and scare potential investors”,Andersen Tax further stated.

Likewise, tax experts at Deloitte in their August 24, 2018 note believe that the above directive by FIRS and the underlyinglegalbasesappeartopermit relevant tax authorities to appoint an agent and request for payment. They however noted that the development raises a myriad of concerns, “especially from banks and taxpayers” that include “potential violation of banks’ privacy and confidentiality obligations”.

“Where the directives of the RTAs are effected by banks, it may lead to a breach of confidentiality obligation

Thursday 18 October 2018

to the customers. Understandably, this obligation is to the exception of valid legal requirements, thus it becomes important to ascertain the extent of the RTAs’ powers in this regard,” Deloitte tax experts noted.

“Confirmation of the validity of the alleged tax liabilities – Under the relevant legislation, the right to appoint an agent crystallises where there is ‘tax payable’ or ‘tax debt’.Considering that taxpayers are permitted to object to assessments or decision of RTAs (and taxes may not be due until such assessment is final and conclusive), it may be difficult for the banks to ascertain that tax is payable”, experts at Deloitte had also stated.

But Taiwo Oyedele, Tax Leader for PwC West Africa had in an August 24 note said that the power of substitution is a very important tool for the tax authority in recovering unpaid taxes especially from tax evaders.

“It is similar to a ‘garnishee order’ in many countries where the court may direct a third party (the agent) that owes money to the judgment debtor (the defaulting taxpayer) to instead pay the judgment creditor (the tax authority)”, he added.

According to him, “This power must however be exercised with caution and in accordance with the law to avoid negative impact on the business environment and ease of paying taxes. Even where the tax authority has powers to deem tax payable under certain conditions as specified in the law, this power is not to be exercised arbitrarily.”

“On the part of taxpayers, it is extremely important to attend promptly to all tax matters including assessments and keep appropriate records of their tax affairs. The days of tax matters being neglected without consequences are over for good,” Oyedele warned.

“Although section 50 of CITA provides an indemnity for the agent where it acts under the appointment of the FIRS, it will be irresponsible for an agent to oblige the appointment without first taking reasonable steps to establish that the tax is payable,” he noted.

Atiku tipped to emerge as candidate for coalition of 40 political parties L-R: Seye Awojobi, registrar/chief executive, Chartered Institute of Bankers of Nigeria (CIBN); Rosaline Bozimo, administrator, National Judicial Institute (NJI); Uche Olowu, president/chairman of council, CIBN; Mary Peter-Odili, justice of the Supreme Court of Nigeria; Ken Opara, 2nd vice president, CIBN, and Pius Olarenwaju, national treasurer, CIBN, at the 18th national seminar on banking and allied matters for judges in Abuja, yesterday.

Off-grid solutions attract $410m in new...

Continued from page 1

governance support to provide

energy access for over 70million people without power.

A $350million World Bank loan emerged the game changer this year but Shell Nigeria seeded company, All On, an impact investment firm based in Lagos, in partnership with the US African Development Foundation (USADF), African Development Bank (AfDB), and government support through the Rural Electrification Agency (REA), the story of energy access in rural communities in Nigeria and even in large city centres like Lagos and Abuja is changing.

“So far we have invested over $10 million into Nigeria’s energy space and we have partnered with All On to foster the growth of local enterprises to bring power and connectivity to unserved Nigerians,” says CD Glin, USADF’s president and CEO whose development focus is on youth and energy access in Nigeria.

Earlier this year, the World Bank provided the Nigerian government, a $350 million loan for the develop-

ment of rural electrification projects in the country. This is to help generate up to 3,000 megawatts (MW) of electricity with about 10,000 mini grid projects to electrify communities in the country by 2020.

Last month, All On, announced partnership with the African Development Bank (AfDB); the Nordic Development Fund (NDF); Global Environment Facility (GEF); and Calvert Impact Capital (CIC) towards a $58 million first close for the Off-Grid Energy Access Fund (OGEF).

All On, organised an energy challenge in July which saw four early stage energy companies receive $40,000 for innovative renewable energy solutions ranging from a generator powered by water to an air conditioner that does not require electricity.

On Wednesday, All On and USADF announced winners of another round of energy challenge, organised in partnership with USADF and awarded $100,000 grant, half in the form of low interest loan between 7 and 10 percent over five years and half as grant to support 10 different companies providing energy solutions for

productive use in agro processing to a solar power assembling plant.

“The biggest challenge hindering Nigeria’s economic and social development is access to energy. These off grid companies are introducing innovations that will improve household livelihoods and local economies by providing affordable power to unserved and underserved communities. We are proud to partner USADF to provide an innovative blend of financing to these companies to enable them scale up and meet increasing demand,” said Wiebe Boer, CEO of All On. Speaking on the nature of the partnership, Glin said, “This partnership combines grant capital with private sector funding to support the selected Nigerian enterprises with the means to grow their businesses, increase access to power and change people’s lives.”

To assuage the concerns about misuse of the grant, Glin said because it is the US tax payer’s money that is used, they partner a local organisation to carry out due diligence on the companies and All On is on ground working with the companies to ensure they get the support and mentoring they need.

•Continues online at www.businessdayonline.com

Innocent Odoh, Abuja

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ational Chairman of the National Unity Party (NUP) and a member of the Coalition of United Political Parties (CUPP), Perry Opara, has said that the Presidential candidate of the People’s Democratic Party (PDP) will emerge as the consensus candidate. This is as the 40- member party coalition prepares to nominate one candidate in a couple of days.

Opara told BusinessDay in an interview that the former Vice President has all it takes to emerge the overall choice of the coalition to challenge President Muhammadu Buhari in the 2019 Presidential election.

He also predicted that Atiku will defeat President Buhari in the election even as he said that more people will dump the ruling All Progressives Congress (APC) before the 2019 elections.

“In a couple of days from now we are going to do election to choose our consensus presidential candidate and I am one of those talking with other CUPP members. I am campaigning vigorously for Atiku, I want other CUPP members to vote for Atiku when we converge to do the nomination. Atiku is the best candidate for consensus presiden-

tial candidate irrespective of the fact that other political parties also have their own presidential candidate but we are urging everybody to queue behind Atiku, he will deliver, he is going to beat APC and all of us are going to smile at the end of the day.

So I urge the CUPP members to rally round Atiku,” he said.

He said that another wave of defection will hit the APC saying “in APC, it has already started, people are angry, there are parallel congresses and people are complaining, even serving governors are complaining bitterly, senators are complaining, so the implosion will soon come, watch out and see, before we start the campaigns there will be more and more defections from the APC. Nigerians are people you don’t push to the wall and expect them not to react, they are going to react because things have gone wrong in the country and we need to fix it.”

Opara noted that the election of Atiku Abubakar in the PDP Primary “is a step in the right direction, it was unprecedented in Nigeria’s history, we have not seen a thing like that, where more than ten people will run for one office and at the end of the day there was cohesion, everybody accepted the result, no one has complained about the conduct, it shows that PDP has been reinvigorated and reformed,” he said.

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Executive order 6: Buhari taking us back to military era, says Afenifere, ADC INIOBONG IWOK

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ore criticisms have continued to trail the travel ban imposed on 50 high profile Nigerians by President Muhammadu Buhari, this is just as the Leader of Pan-Yoruba socio-cultural group, Afenifere, Ruben Fasoranti, and the Lagos State chairman of the African Democratic Congress (ADC) Tunde Ademola, have criticised the move, describing it as an attempt to drag the country back to the military era and capable of increasing the rising tension in the country.

Recall that President Buhari in a statement last

Saturday ordered the placement of 50 high profile Nigerians on watch list, banning them from travelling out of the country pending the determination of their corruption cases in court.

But speaking yesterday in separate interviews with BusinessDay, the leaders, stated that the president’s action was an attempt to take over the function of the judiciary, they wondered why several chieftains of the ruling All Progressives Congress (APC) who are close associates of the President were missing from the list if he was serious about the anti-graft war.

Leader of Afenifere, Fasoranti expressed surprised that the current administration could initiate such

Buhari

South-East governors not against Peter Obi’s candidacy - Ikpeazu ...As Abaribe, others declare support GODFREY OFURUM, Aba

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overnor Okezie Ikpeazu of Abia State has denied reports making the rounds that South-East governors and leaders of the People’s Democratic Party (PDP) in the region, are against the nomination of Peter Obi, former governor of Anambra State, as the running mate of Atiku Abubakar, presidential candidate of the PDP at 2019 presidential election.

Ikpeazu, who was fielding questions from journalists in Aba, when Peter Obi paid a condolence visit to him and the people of Abia State, over the pipeline explosion in Osisioma Ngwa, which claimed so many lives, explained that it was a blatant lie for anyone to claim that the governors of the SouthEast region are against Obi. He described Obi as a worthy son of Igbo land and a gift from Ndi-Igbo to Nigeria, whom every Igbo man both at home and in the Diaspora, would queue behind, considering his pedigree.

According to Ikpeazu, “You were told a lie. Let me use this opportunity to congratulate our brother and a worthy son of Igboland, on his nomination. He’s a gift from Ndi-Igbo to this country. His works and pedigree bears eloquent testimony of the Igbo DNA. “It will be foolhardy for anybody not to queue behind a man like this to continue to serve this country, to the best of his ability. What the South

East governors said was that we expect our candidate to come back from his trip and have a chat with us. And he said he will come to speak with us, as soon as he returns home.

“There was no time that leaders of Ndi-Igbo and SouthEast Governors said we are not happy. His choice was apt and you can see the wide spread reception it is getting. If we are banking on the eleven million Igbos in the Diaspora to vote, it is only Peter Obi that can get them to do so”.

Enyinnaya Abaribe, senator representing Abia South senatorial zone in the enate and chairman, South-East caucus of the National Assembly, stated that Peter Obi’s selection has lifted the spirit of every Igbo person and so has no opposition from any angle.

“As the chairman of South East Senate caucus of the National Assembly, the whole National Assembly is behind Peter Obi and at no time was there any problem about his nomination, as running mate to our presidential candidate.

“We know that ourselves, the governors forum and everybody in the South-East are all in support of his selection, because today, Nigeria needs men and women, who their yes is their yes and no is their no. “We need people, who will not see subsidy and call it under recovery. We need people, who will not say that they’ve defeated Boko Haram and they turn around and keep executing Red Cross Workers.

order months to the general election, adding that such action portend danger for the country at this time.

“What the president has done is very bad; there is no justification for such in a democracy, why is he taking over the function of the Judiciary? Let them be placed on house arrest instead; it is then we would know what is in our hand.

“I am surprised that he is doing this at this period, some months to the general election, it is not good. What about the people in his government who have been accused of being corrupt, they are walking, traveling freely, what has he done to them?”

Fasoranti said.

Tunde Ademola, ADC chairman, said that the party

Today, what we have is somebody we can all queue behind to rescue Nigeria. Let me say it without equivocation that all Igbo leaders are queuing behind Peter Obi.” Meanwhile, Obi, while speaking during his condolence visit urged Abia people to take heart. He consoled the locals and made personal donations to the affected people.

Speaking on his nomination and the perceived opposition from South-East, Obi said, “We in the South- East have never been divided and we have never acted against each other.

“We have always acted as a team. The governors and the leaders are my own leaders.

Since this wrong insinuation started, I’ve consulted governor Umahi, Ugwuanyi and of course today I’m here with my brother Ikpeazu. I have spoken to all the three PDP governors in the region.

“I’ve spoken to Ike Ekweremmadu, deputy senate president, who is one of our leaders and of course Abaribe, is here with me. I’ve spoken with all of them including Theodore Orji and Sam Egwu. For us, we are going to work like a team.

For us what is important is to rebuild Nigeria and rebuild the South East.

“What we need is to create jobs and make Nigeria better.

We have always acted as a team. It is an opportunity for us to come out and vote massively for the PDP. We must put all hands on deck to get this mission accomplished”.

was surprised by the President action, stressing that it was now obvious that the APC was jittery ahead of the general election because it had performed woefully.

Ademola challenged the President to explain to the country what his administration had done to several individuals accused of being corrupt in his administration.

“It is a move to silence the opposition by the APC, it is obvious they have failed and they are afraid of losing the elections that is the reason for all this.

“However, we are back to the military era, when we had illegal detention and house arrest, it is taking us back and we would move agents it,” Ademola said.

Kwara PDP appeals to journalists not to boycott coverage of political parties SIKIRAT SHEHU, Ilorin

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he Kwara State chapter of the People’s Democratic Party (PDP) has appealed to journalists in the state not to boycott coverage of political activities in the state.

The State Council of the Nigerian Union of Journalists (NUJ), had earlier threatened to withdraw coverage of political parties in the state if attacks and assaults on its members by supporters of political parties and suspected thugs continued.

Some members of the union were allegedly attacked in some parts of Ilorin during the recently conducted governorship primaries of the All Progressives Congress (APC) in the state.

Another correspondent of Daily Trust was reportedly assaulted at a rally organised by the supporters of one of the governorship aspirants of the APC. In a statement on Wednesday by its State Publicity Secretary, Tunde Ashaolu, the Kwara PDP condemned the attack on newsmen, describing it as barbaric and unacceptable.

“We condemn in strong terms the barbaric, worrisome and an unacceptable attack on journalists and the destruction of their equipment by thugs and supporters of some politicians in the state.

“The party empathises with the affected journalists and appeal to them and their professional colleagues not

to stop reportage of political events vis-a-vis activities of political parties in the state.

“We advise the NUJ as a body to formally report the incident to security agencies in the state. We equally call on the police to thoroughly investigate the attack, arrest the culprits and their sponsors and bring them to justice.

“As a party, we value the work and contributions of members of the fourth estate of the realm and we regard them as partners in progress.

“We, therefore, call on politicians in the opposition to warn their thugs and supporters to stop their ceaseless attacks on journalists who move around to discharge their constitutional duties.”

2019: APC denies defection of aspirants in Ondo YOMI AYELESO, Akure

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he All Progressives Congress (APC) in Ondo State has denied reports that notable aspirants were planning to defect from the party.

The party in a statement by its spokesman, Alex Kalejaye said the reaction was imperative to erase the erroneous impression, and assure party faithful that the state chapter is still intact, and has resolved to handle whatever grievances that might have arisen from the primaries, within its fold.

Among prominent names that were touted to be planning to defect include Lucky Ayedatiwa and Tunji Abayo-

mi, a senatorial hopeful from Ondo North.

The former is the Ondo State representative on the governing board of the Niger Delta Development Commission, and senatorial aspirant from Ondo South.

The statement said: “There is no iota of truth in such permutation, and imaginative analysis. Hon. Ayedatiwa, for example, has said repeatedly that he would never leave the APC for any other political party.

“Like Ayedatiwa, most aspirants, from the senatorial, the House of Representatives, to the State House of Assembly, have put the primaries behind them and

are currently preoccupied with how the party would triumph during the general elections.

The party, however, said it was not under any illusion that there is need to reach some members that might have picked offence at the party decisions, with a view to pacifying them, to enhance the party’s chances in 2019.

The leadership of the party, as well as the State Working Committee (SWC) according to him, is not leaving any stone unturned in its quest for higher degree of understanding and accommodation in the state chapter.

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Maritime, catalyst for Nigeria’s industrialisation - Peterside AMAKA ANAGOR-EWUZIE

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or Nigeria to effectively move away from being an oil-dependent economy and industrialise, it must develop the blue economy, Dakuku Peterside, director-general, Nigerian Maritime Administration and Safety Agency (NIMASA), said at the 2018 World Maritime Day celebration held in Lagos on Tuesday.

Themed “IMO 70: Our Heritage - Better Shipping for a Better Future,” this year’s event, which coincided with the 70th anniversary of the International Maritime Organisation (IMO), according to Peterside, could not have come at a better time than now, when Nigeria is taking deliberate steps to harness the enormous benefits of her maritime industry.

According to Peterside, NIMASA is taking various steps to ensure the growth of the sector for the overall economic benefit of the country. “We want to make sure that our maritime sector remains virile and this is why we are making moves to safeguard our maritime do-

main, because we cannot talk about shipping without taking the safety and security of our maritime domain seriously,” he said.

He pointed out that the total spectrum of maritime security strategy being put in place by the agency would ensure that the maritime subsector was rid of criminalities that hamper the industry’s growth and make Nigeria one of the safest maritime domains in Africa.

He said NIMASA had succeeded in reducing the issuance time for bill and sailing clearance to vessels to 24 hours, thereby reducing the delay in vessel turnaround time in line with the executive order of the Federal Government on Ease of Doing Business. Sabiu Zakari, permanent secretary, Federal Ministry of Transportation, who represented the minister of transportation, Rotimi Amaechi, said Nigeria received and generated a lot of cargo and must, therefore, take advantage of its geographic position to grow its economy through effective maritime development.

Free fuel Friday with Firstbank Verve Card

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irst Bank of Nigeria is set again to reward customers for Verve Card usage in its Free Fuel Fridays Promotion.

The free fuel Friday promo, which is activated by FirstBank in collaboration with Verve International and Oando plc, kicks off on Friday, October 19, 2018 to Friday, December 7, 2018, between 6am and 8pm.

In the promo, for a minimum of N3,000 fuel purchase, FirstBank Verve Card holders will receive five extra litres of fuel for free instantly at selected Oando fuel stations across Lagos.

The Oando fuel stations where the promo will run are Lekki Stillwaters, Alapere, Marina, Ojodu, Maryland, Awolowo 1 (by Fire Service), Agege-Bypass, Lawanson, Apapa Dump, and Herbert Macaulay Way stations.

Verve card is a secure debit card which allows the card holder to conveniently meet day to day financial needs such as payment for goods and services, airtime recharge, bill payments, funds transfer, etc. It is accepted across all ATMs, POS, Web and Mobile Platforms in Nigeria

Senate approves Buhari’s $2.9bn foreign loan request OWEDE AGBAJILEKE, Abuja

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he Senate has approved the request

by President Muhammadu Buhari to secure two external borrowings totalling $2.868 billion.

The approval followed the adoption of a report by the Senate Committee on Local and Foreign Debts at the plenary on Wednesday.

Last week, President Buhari had written to the Senate seeking approval for $2,868,540,000 external borrowings.

The request was contained in a letter to both chambers of the National Assembly, which was read by the Senate president, Bukola Saraki.

Buhari had explained that while $2.786 billion would be borrowed from the international capital market, the Federal Government needed another $82.54 million from the international capital market to refinance the balance of $500 million mature Eurobond in the international capital market.

Presenting the report of the committee on Wednesday, its chairman, Shehu Sani (APC, Kaduna State) said the projects for which the loan was requested would stimulate economic development and create direct and indirect jobs for Nigerians, while the $82.54 million bonds would create more borrowing space for the private sector.

L-R: Muda Yusuf, director-general, Lagos Chamber of Commerce and Industry (LCCI); Rama Rao Potta, QA/QC-Construction Refinery, Dangote Oil Refining Company; Olayinka Akande, group general manager, Corporate Relations; Babatunde Paul Ruwase, president, LCCI; Funmi Babington-Ashaye, managing director, Risk Analyst Insurance Brokers Limited, and Soboma Ajumogobia, vice president, LCCI, during a tour/visit of LCCI delegation to the Dangote Refinery in Ibeju Lekki, Lagos.

Brent crude rises towards $85 on surprise drawdown in US crude stockpiles DIPO OLADEHINDE, with NAN

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rent crude, the benchmark for Nigeria’s crude oil, extended gains into a fourth session on Wednesday, sustained as industry data showed a surprise decline in US crude inventories and geopolitical tensions over the disappearance of a prominent Saudi journalist stoked supply worries.

Data from US-based American Petroleum Institute (API) showed after Tuesday’s settlement US crude inventories fell by 2.1 million barrels last week, compared with analyst expectations for a build of 2.2 million barrels.

“The market is reacting to the unexpected decline as inventories tend to rise at this time of year,” Tomom-

ichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo told Reuter.

Brent crude was down $1.48, or 1.82 percent, at $79.93 a barrel by 4pm after gaining $1.15 in the previous three sessions. The global benchmark, which hit a twoweek low last week as equity markets dropped, is trading around $6 below a four-year high of $86.74 reached on October 3.

Gbolahan Ologunro, an industry research analyst at CSL Stockbrokers Limited, told BusinessDay that the oil market appeared to be caught in a frenzy of reinforcing forces that could trigger a rally in oil prices.

“The confluence of hurricane in the US, expectation of a reduction in output in Iran owing to Trump sanctions coupled with the re-

cent standoff between Saudi Arabia and US which has added to the layers of geopolitical tensions in the Middle East could precipitate uptick in oil and prices towards $100 a barrel,” Ologunro told BusinessDay on phone.

The API data also showed US gasoline stocks dropped by a larger-than-expected to 3.4 million barrels, while distillate fuel stockpiles declined by a smaller-thanexpected number of 246,000 barrels.

Also underpinning sentiment is the scandal over the disappearance of prominent Saudi critic and journalist Jamal Khashoggi, who disappeared two weeks ago after entering the Saudi consulate in Istanbul.

US President Donald Trump gave Saudi Arabia the benefit of the doubt in the case even as US lawmak-

ers pointed the finger at the Saudi leadership and Western pressure mounted on Riyadh to provide answers.

Saudi Arabia has said it would conduct an investigation into the disappearance, US Secretary of State Mike Pompeo said before departing the kingdom for Turkey.

Most of the big names that were due to attend Saudi Arabia’s investment conference next week have bailed out following the unexplained disappearance of the journalist.

IMF managing director, Christine Lagarde, joined the list of dropouts on Wednesday, closely followed by the heads of two of France’s biggest banks.

Wall Street’s biggest names withdrew earlier this week, as did some of Europe’s top executives in finance.

Education reform: Edo Poly Usen floats Mass Comm. programme, set to train digital media entrepreneurs

Edusko holds 2nd edition of Business of Education summit

do State Polytechnic, Usen, formerly known as the Edo State Institute of Technology and Management, has floated a National Diploma programme in Mass Communication, with a commitment to train a new crop of digital media entrepreneurs.

Rector of the Polytechnic, Abiodun Falodun, a professor, in a statement, says the new programme is in line with its mandate to provide quality education to Nigerians, noting that the institution is set to make digital media entrepreneurs of students with the programme.

He says other new programmes mounted by the Polytechnic are Higher National Diploma in Accountancy, Business Administration and Public Administration.

According to Falodun, “We are always reinventing ourselves to respond to demands in our immediate community. That is why we are mounting the mass communication programme, which is sure to

ll is set for the second edition of the Business of Education, an annual education summit where school owners, administrators, directors, policy makers and education entrepreneurs converge to discuss and proffer solutions to issues and problems in Nigeria’s education system.

According to Edusko founder and event convener, Jide Ayegbusi, this year’s edition will focus on the roles of school leaders, policy makers and technology in preparing children for the future.

“It is no longer a news that we are currently preparing our students for jobs that do not yet exist, to use technologies that have not been invented in order to solve problems we do not even know are problems yet. While the first world seems to be far ahead, it seems we have not started scratching the surface,” Ayegbusi said.

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reset the media landscape as we have set the necessary machinery in motion to provide world class media training to the students.”

Noting that the programme is coming on the heels of other innovative initiatives to reposition the school as a world class institution, he said the polytechnic has just commenced programmes in the School of Environmental Studies and School of Applied Science with visiting lecturers from overseas, which will ensure the internationalisation of the school’s programmes.

He says, “The mass communication programme and these other initiatives are all geared towards ensuring that the polytechnic is better placed on the world map.

We acknowledge the power of communication and its impact on society and business.

This is why we have set out to train a new crop of students that will compete in the labour market and at the same time build their own media empires.

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“What does it mean to be future ready? What roles will technology, school leaders and policy makers play to ensure that we adequately prepare our students for a future that is more unknown than at any time in history?

This year’s summit will sufficiently answer these questions and provide the way forward in ensuring that the next generation of students our schools produce is future ready. Hence the theme: Future Ready Education: Roles of Policy Makers, School Leaders and Technology,” he said.

On the speakers and participants, Ayegbusi said: “We are expecting about 2,000 top school owners, directors, administrators, education entrepreneurs, policy makers and other key stakeholders in the Nigerian education sector.

We have carefully selected our speakers and panellists to ensure everyone is impacted at the summit and beyond.”

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Over N8bn media debt over-hang puts Nigeria moves 10 places in global competitiveness index industry in operational difficulty BUNMI BAILEY DANIEL OBI

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resh facts emanating from the Nigerian media and advertising landscape have revealed that N8 billion media debt over-hang has created operational challenges to the media industry, especially those in the out-ofhome advertising, electronic and print media.

Reports reveal that some multinational clients largely owe the debts.

The debt over-hang is coming against the backdrop of promises made recently by all relevant stakeholders to address the challenge of media debt in brand management and management of brand business in Nigeria.

“While the agencies and the media were believed to have fulfilled their own part of the contractual agreement by executing the contracts, they are now faced with the challenge of getting the clients honour their own part of the bargain by paying the invoices that have over stayed agreed, working grace period of 45 days,” the report noted.

The delay in payment, it

was gathered, has been attributed to the sudden twist in the existing payment due date of 45 days by multinational companies who are said to be demanding 180 days to process media invoices before payment.

However, the Nigerian advertising practitioners and media owners have decried this request, stating that it negates what is fashionable and obtainable at global markets.

The report quoted senior industry operator, Sola Bamgbose, who described it as “uncharitable the request by the multinationals asking for 180 days of grace to settle the media debt. Such a request in this modern day and time negates the true spirit of fairness and justice, as some of these companies do not ask consumers of their goods, products and services to come and pay them after 180 days of consumption.

“The request by multinationals to extend 45 days of grace to 180 days before paying their media vendors is uncharitable, unfair and unjust. How will they justify this request when in actual fact they collect money instantly from the consumers of their

goods and services? Do they ask consumers to come and pay for their goods after 180 days of purchase.”

According to the report, Kola Ayanwale, a senior advertising professional and group managing director of Centerspread Grey, said the media debt challenge, which has been ageless, was now taking a new twist if clients now demand for 180 days.

Such demand cannot be justified while the companies in their home countries do not do such for the media in their respective countries, he said. He however advised media owners, the advertising agencies and other stakeholders to rally in resolving the ever-rising media debt.

In a similar vein, Femi Adeusi, vice president of Media Independents Association of Nigeria (MIPAN), said in the report that he was yet to know about the 180 days request, but nonetheless decried the undue delay in paying the media.

This, he also attributed to the challenges in the terms of agreements for some of these businesses, stating that some business terms and agreements jointly agreed on with clients might cause delay in payments.

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igeria has improved by moving up 10 places, ranking 115th position globally from its previous 125th position, according to the latest global competitiveness 4.0 2018-2019 Report of the World Economic Forum (WEF) released Wednesday.

This latest ranking is the same position the country recorded in the 2012-2013 report under the former administration of Goodluck Jonathan.

Economic experts have acknowledged that the improvement is a significant one for the development of the country’s competitiveness.

Ayodele Teriba, CEO, Economics Associates, said, “Gaining 10 points is better than losing 10 points. We should congratulate ourselves that Nigeria is becoming more competitive, but we can do better than our current ranking.”

Teriba said, “I do know that the government is creating efforts to make the country more competitive, especially in the ease of doing business and the Economic Recovery Growth Plan (ERGP).”

Bismarck Rewane, managing dirctor, Financial Derivatives Company Limited,

said the improvement was significant and that we were doing some things right to improve the country’s competitiveness.

WEF defined the global competitiveness index, a measure of national competitiveness, as the set of institutions, policies and factors that determine the level of productivity of a nation.

According to the WEF report that analysed 140 countries, Nigeria scored 47.6 out of a total score of 100, ranking in 115th position.

The WEF, this year used a new methodology to fully capture the new emerging dynamics of what fuels the global economy, which means including some other indicators that were not included before, such as diversity, workers’ rights, re-skilling and press freedom.

The new index sheds light on an emerging set of drivers of productivity and longterm growth in the era of the Fourth Industrial Revolution.

It provides a much-needed compass for policy-makers and other stakeholders to help shape economic strategies and monitor progress.

The report looked at 98 indicators across 140 countries to determine the overall ranking and to signify how close an economy is to the

ideal state or “frontier” of competitiveness.

The indicators, which were then organised into 12 pillars, are health, skills, financial system, infrastructure, institutions, ICT adoption, macroeconomic stability, product market, labour market, market size, and business dynamism and innovation capacity.

Nigeria scored 42 in the institution indicator, 42 in infrastructure, 26 in ICT adoption, 56 in macroeconomic stability, 51 in health and 40 in skills. In addition, it scored 52, 59, 44, 71, 55 and 31 in product market, labour market, financial system, market size, business dynamism and innovation capacity, respectively.

The aforementioned results showed that Nigeria scored the highest in market size and the lowest in ICT adoption.

“The major driver of this improvement is the large market size that the country has. And we should be able to perform better if we can leverage and take advantage of the market size and build innovations in the areas that we are found wanting, which for me is not something that we cannot correct,” Ayo Akinwunmi, head of research, FSDH Merchant Bank, said.

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Theresa May seeks to overcome deadlock after Brexit setback UK and EU consider extending transition deal to defuse dispute over Irish border backstop GEORGE PARKER, JIM BRUNSDEN AND ARTHUR BEESLEY

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heresa May will on Wednesday night seek to overcome the deadlock in Brexit negotiations as both the UK and the EU eye a new initiative: keeping Britain in a transition that will retain many of the aspects of membership after 2020.

The UK prime minister will address other EU leaders at a Brussels summit as both sides try to put talks back on track so that a breakthrough can be reached in the next few weeks.

One possible avenue for a compromise is the idea of extending the UK’s post-Brexit transition deal — currently due to expire in December 2020 — for a further year until the end of 2021.

Prolonging Britain’s membership of the bloc’s single market and customs union could help resolve an impasse over Northern Ireland.

But it would leave the UK with no say in Brussels over policy for a longer period — as well as continued free movement and budget contributions.

Mrs May is likely to tell the rest of the bloc that the UK is getting nearer to a Brexit deal. Her spokesman said: “We are moving close to one another.”

But, speaking ahead of the summit dinner, a senior EU diplomat said: “What will not happen this evening is a negotiation. [We] will not negotiate in an improvised way.”

The diplomat added that there were “still several weeks of space . . . to find this agreement”, cautioning that “evidently the calendar is getting tighter. The work has to intensify because the stakes are high. No one in Europe wants a no-deal.”

German chancellor Angela Merkel said on Wednesday: “There is still a chance that we can achieve a good and viable withdrawal treaty

Theresa May is likely to tell the rest of the bloc that the UK is getting nearer to a Brexit deal © AFP

on time.” But she added that the bloc had to prepare “for every scenario, including the possibility that the UK will leave the EU without an agreement”.

Mrs May pulled the plug on talks on Sunday after her cabinet warned her that it was not ready to sign up to a draft withdrawal treaty being prepared in Brussels by officials from both sides.

Eurosceptic ministers, including the increasingly influential proBrexit attorney-general Geoffrey Cox, told her on a conference call that day that they could not accept a proposed deal that could end up with Northern Ireland being split from the rest of the UK. The impasse dismayed British officials, who had been told to

prepare the ground for a deal on the withdrawal treaty at this week’s EU summit. “They were spitting blood,” said one person close to the British team.

But Mrs May has told other European leaders, including Ms Merkel and French president Emmanuel Macron, she needs more time to bring her cabinet and Eurosceptic MPs around.

She is not expected to put forward any new proposals at this week’s summit, but she has told fellow ministers not to be “downhearted” if fellow European leaders do not set a date for a November summit.

British ministers increasingly talk about the real deadline for a Brexit deal shifting to the European

Council meeting in December, although the EU is prepared to move in November if there is a breakthrough in negotiations.

In a sign of the constraints on the prime minister, at a cabinet meeting this week Mr Cox spelt out Eurosceptic objections to any separate treatment of Northern Ireland in a Brexit deal — the heart of EU attempts to avoid a hard border on the island.

The EU’s “backstop” proposals, which Mrs May has denounced as unacceptable, would in effect split Northern Ireland from the rest of the UK by keeping the province in the EU’s customs union and single market territory. “[Mr Cox] said that we would be legally signing up to a deal that

would split the union,” said one official briefed on the cabinet discussions. “The cabinet agreed it would only approve any deal after a full assessment of its legal ramifications by Geoffrey.”

Mrs May’s allies also confirmed that Michel Barnier, the EU’s chief negotiator, had been “kicking the idea around” of an extended transition to defuse some of the problems over the backstop — now the most difficult issue in the negotiations.

Lengthening the transition past 2020 would give the EU and UK more time to negotiate a free trade deal — which Mrs May wants to produce “frictionless trade” — to obviate the need to trigger such a backstop.

SoftBank voices doubts over second Vision Fund General Electric beats Siemens to Iraq power-generation contract Geopolitical risk around Khashoggi affair exacerbates concern over Son strategy

KANA INAGAKI AND LEO LEWIS

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oftBank has voiced its doubts about the likelihood of a second $100bn Vision fund for the first time, as investors fret that its plans could be disrupted by the intensifying furore surrounding Saudi Arabia.

Marcelo Claure, Softbank’s chief operating officer, said “there is no certainty” that SoftBank will launch another Vision Fund and added that no dates have been setSpeaking at a technology conference in San Jose, Mr Claure added that SoftBank is “anxiously looking at what is happening” in Saudi Arabia after the kingdom became the subject of international criticism after the disappearance of the journalist Jamal Khashoggi.

SoftBank’s share price on Wednesday was down 11 per cent from its level on October 5, as the broader market sell-off combined with worries from investors about its strategy and its proposal to spin

off its mobile telecoms business.

The current share price does not reflect any belief there will be a second Vision Fund, said a portfolio manager at one of SoftBank’s top 20 investors. “The market has not priced in a Vision Fund II.” In the months ahead of the disappearance of Mr Khashoggi, shares in SoftBank had surged as investors began to buy into Masayoshi Son’s vision of the future — ambitions that were underpinned by huge technology bets made through the world’s largest investment fund created with $45bn from Saudi Arabia.

Boasting strong returns from the first Vision Fund launched last year, SoftBank’s billionaire chief executive had confidently suggested that “Vision Fund II” was on its way with fresh Saudi backing.

That plan now looks precarious and analysts warned the fallout may expose a potential vulner-

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Trump administration pressured Baghdad to reject German rival’s bid for $15bn deal PATRICK MCGEE AND ED CROOKS

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iemens’ hopes of winning a big contract to supply power to Iraq have been dashed after the Trump administration intervened on behalf of US rival General Electric, according to people familiar with the matter.

In recent weeks it had looked as though Munich-based Siemens was close to securing a contract to supply 11 gigawatts of power-generation equipment to Iraq, in a deal reported to be worth $15bn.

But as the contest between the German engineering group and GE reached its final stages, the Trump administration put pressure on the Iraqi government, reminding Baghdad that 7,000 Americans had died since the 2003 invasion to oust Saddam Hussein, according to people familiar with the negotiations. GE is now expected to take a substantial share of the sale.

A big contract win would be a welcome piece of good news for GE’s troubled power division, which has reported plunging profits for the past two years and warned earlier this month

that it would take a non-cash writedown of up to $23bn in the third quarter. The company is expected to announce its success soon, possibly when it reports third-quarter earnings on October 30.

For Siemens, which worked for months on what it called its “road map” for developing electricity supplies in Iraq, losing the sale would be a stinging disappointment. Last month Joe Kaeser, Siemens’ chief executive, travelled to Baghdad to meet outgoing Iraqi prime minister Haider Al-Abadi, and it seemed that a deal was close.

However, a top adviser to Mr AlAbadi told Siemens two weeks ago to give up and go home because the German company’s persistence was causing problems for Iraq given how intense the US government pressure had become.

“The US government is holding a gun to our head,” the adviser said, according to another person familiar with the incident.

One potential delay in a contract decision could come from the transition in the Iraqi government. New prime minister Adel Abdul Mahdi was appointed

at the beginning of the month, but has not yet formed a cabinet.

However, the US and Iraqi governments have already signed a non-binding memorandum of understanding outlining how they would co-operate on oil and gas production and power generation.

According to someone who has seen the MoU, the US plans to offer financing and insurance for American companies doing business in the Iraqi power sector. That will help GE win contracts and operate in Iraq, although Siemens, which has its power and gas unit headquartered in Houston, Texas, could also benefit.

Iraq’s decision on the contract comes as the government is seeking to win support from the Trump administration over the country’s gas imports from Iran. About 35-40 per cent of Iraq’s electricity is generated by plants burning Iranian gas, according to Michael Rubin of the American Enterprise Institute, and the government is worried that when reinstated US sanctions take effect on November 5, those purchases could result in penalties from the US.

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Angolan central bank chief warns lenders to boost capital

SoftBank voices doubts over second Vision Fund Continued from page A5 ability in Mr Son’s strategy that hinges on the success of SoftBank’s equity investments to offset about $130bn in debt sitting on its balance sheet.

“If SoftBank cannot raise money in the next round of fundraising due to the geopolitical risk in Saudi Arabia, it would impact its growth strategy,” said Mana Nakazora, chief credit analyst at BNP Paribas Securities in Tokyo.

As a growing number of tech executives begin to distance themselves from Saudi Arabia’s business ventures following Mr Khashoggi’s disappearance, one risk is that companies would stop accepting funding from the Saudibacked Vision Fund. A bigger risk is if other investors in the existing Vision Fund shy away from the second fund.

There is no evidence yet that companies are starting to reject offers from the Vision Fund and SoftBank appears committed to its Saudi partnership. “We are married to the Saudis,” a person close to SoftBank said last week.

But speculation over SoftBank’s strategy has also intensified ahead of the group’s preparations for what analysts describe as a “philosophical shift” in its business model as it prepares to list the company’s cash generative mobile telecoms business.

“Frustration with the market valuation of SoftBank is a part of the motive for the initial public offering — but there is also a philosophical shift behind it,” said Nathan Ramler, an independent telecoms analyst writing on the SmartKarma platform.

SoftBank’s plans for the telecoms IPO, for which it has appointed Goldman Sachs and Nomura as lead underwriters and hopes to complete by the end of December, stand out against a worldwide background of cancelled listings.

As well as doubting the underlying logic of spinning out the cash-generative mobile business, investors have questioned the apparent urgency behind the IPO. One Tokyo-based asset manager said that the share offering, which is likely to primarily target individual Japanese investors, looked increasingly like financial engineering by a chief who believes he is “more right than the market” and that his company’s share price should be much higher.

Mr Son has argued that the partial sale of its SoftBank’s mobile business would help to unlock the value of the company’s assets, which he says suffer from a conglomerate discount.

Others say the urgency to spin off the telecoms unit does not necessarily reflect a desperation to raise cash but simply the reality that Mr Son now spends almost his entire time on finding the next investment targets for the Vision Fund.

“I seriously doubt Son spends much time, if [any] at all, on the telecoms business. If he is more focused on investing in new businesses and the internet, what’s the point of holding on to it for too long?” said Daniel Baker, an analyst at Morningstar.

Thursday 18 October 2018

Institutions will disappear if they fail to reform, says Jose de Lima Massano DAVID PILLING

A The Innovation Village in Kampala, Uganda, one of hundreds of tech hubs and start-up accelerators to have opened across Africa in recent years © Natalia Jidovanu

How to boost early stage deal flow in Africa Tech hubs, accelerators and incubators need the tools to do their job RACHEL CRAWFORD

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eed and early stage investment in Africa remains stubbornly low and new thinking is required to boost deal flow.

One largely untapped resource is Entrepreneur Support Organisations such as tech hubs, accelerators and incubators, which are proliferating on the continent. ESOs have great potential to catalyse investment but only with the right agenda and resources.

The Emerging Market Private Equity Association recently reported that the amount of venture cap it a l inve ste d in Africa has been rising in both absolute terms and relative to other forms of private equity since 2015. This is welcome news, if only because of the demonstrated ability of venture capital-funded businesses to create jobs on the continent with the world’s fastest-growing population.

However, we need to keep a sense of perspective. By some measures, venture capital invested in India ($245m) during the last full year was almost three times that calculated by EMPEA in Africa (about $90m).

Digging further into the figures from EMPEA, it also becomes apparent that late-stage VC investment has been driving the most recent gains. Again, this is mixed news. On the one hand it is a sign that the problem of the so-called missing middle is being resolved, providing a pipeline for the still-

dominant large funds that have to chase the largest deals.

On the other, the figures confirm that the conclusion in a Global Impact Investors Network report from 2015 is still valid, namely that early stage investors have “difficulty placing capital”.

Restricted access to funds will hobble the prospects of the continent’s start-ups and raises the question of what will fill the pipeline for the middle.

If you ask investors what would remedy their difficulty, as the GIIN research went on to do, we learn that they see: “Gaps . . . in particular for organizations that can produce a large number of investment-ready opportunities.”

This desire for trusted intermediaries is not a surprise because not every investor can follow best practice and maintain a consistent local presence, especially outside of the leading start-up ecosystems of Lagos, Nairobi and Cape Town.

Also note the key words “investment-ready”. Africa is not suffering from a dearth of start-ups per se.

Anyone on the ground in Africa knows that talented entrepreneurs with great ideas abound in sectors from education to energy. Indeed, the OECD and the UN rank Africa as the most entrepreneurial region in the world. Rather, the need is for entrepreneurs who can speak the language of investors; a language that can be taught.

Fortunately, a class of organisation has emerged across Africa recently with the potential to find and serve “investment-ready” opportunities to investors: ESOs,

especially the burgeoning number of tech and innovation hubs.

Since 2016, the number of active tech hubs across Africa alone has grown by more than 50 per cent to 442, with dozens more planned, according to the GSMA in 2018.

To date, ESOs have focused largely on valuable technical and moral support for early stage ventures, with some development of core business skills. Where they have extended into investment, typically via or as accelerators, they often suffer from failings that can result in “few start-ups landing investments and disenchanted investors”, according to the World Bank.

Now, institutions such as the World Bank and the UK’s Department for International Development, through its Impact Programme, are pioneering initiatives that bolster ESO capabilities. They have respectively established a model investment-focused ESO programme that is embedded in local ecosystems (XL Africa) and funded a continent-wide initiative to build out the capacities of existing ESOs sustainably (VilCap Communities Africa, which we are implementing).

The initiatives impart best practice to ESOs in finding promising local ventures and coaching them in investment readiness to transform their prospects for funding. During coaching provided by more well-equipped ESOs such as jokkolabs in west Africa, founders will learn which stage of maturity their business is at in order to deal with the right investors and focus on addressing the right issues.

Chinese, European groups to partner on vast Congo hydro project Inga 3 would become Africa’s largest hydroelectric power station if successful TOM WILSON

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he two consortiums competing to build Africa’s largest hydroelectric power station in the Democratic Republic of Congo have agreed to work together to advance the long-delayed project.

The Chinese and European led groups and the Congolese government on Tuesday signed an exclusive development agreement to jointly develop an expanded version of the long-planned Inga 3 Project, with an installed capacity of 11,000 megawatts.

If successful, that would make Inga 3 the biggest hydro-project in Africa, delivering almost double the power of the planned Grand

Renaissance Dam in Ethiopia. Initial proposals for Inga 3, the first phase of a series of possible expansions of the existing Inga dams on the Congo River, anticipated a capacity of 4,800 megawatts.

The increase in planned capacity is in response to greater national and regional demand since the public tender was launched in 2010 and the improved economies of scale of a larger project, the Congolese Presidency said late Tuesday in an emailed statement.

The group of investors includes, among other firms, China Three Gorges International Corporation, Power Construction Corporation of China Ltd. and the Madrid-head quartered Cobra Instalaciones y Servi-

cios S.A. and AEE Power Holding S.L. While the decision to combine efforts represents progress, the project has suffered continuous delays in the last eight years and critics remain sceptical of whether such an ambitious project is possible in Congo.

The expanded dam is estimated to cost $14bn and would be the biggest infrastructure project ever undertaken in the country where political instability, weak institutional capacity and high levels of corruption complicate the operating environment.

The companies will now finance another round of technical studies and environmental and social impact assessments before submitting a final proposal to the Congolese government.

ngola’s central bank governor has warned that some of the country’s lenders will disappear if they fail to boost their capital as part of far-reaching government economic reforms.

Banking consolidation in a sector riddled with bad loans, many of them politically connected, is part of the wider changes that have accompanied a dramatic political transition in sub-Saharan Africa’s third-biggest economy and second-biggest oil exporter.

In an interview at the FT Africa summit in London last week, Jose de Lima Massano, central bank governor, said he had given the country’s 29 banks a December deadline to raise their capital requirements.

“Some of the banks, I don’t think they’ll be able to do it,” he said. Those that could not would be shut down: “They will disappear.”

A handful of Angola’s banks — Banco Angolano de Investimentos, Banco Econômico, Banco de Fomento Angola, Banco BIC Angola and Banco de Poupança e Crédito — control up to 80 per cent of lending, leaving a long tail of much smaller banks.

The new administration of President João Lourenço, who replaced José Eduardo dos Santos last year, has sought to restore economic stability, which deteriorated badly in the final years of Mr dos Santos’s 38-year tenure.

This year, it has allowed the kwanza to devalue 45 per cent, replaced murky allocation of dollars with foreign exchange auctions and unwound monopolies linked to the dos Santos family. Inflation has nearly halved from 42 per cent in 2016 to 23 per cent.

The government has also cracked down on corruption, exposing what it alleges to be fraud in the management of the country’s $5bn sovereign wealth fund, which was headed by Filomeno dos Santos, the former president’s son, until his dismissal in January. Mr dos Santos has denied the allegations.

Separately, Mr Lourenço removed Isabel dos Santos, the former president’s daughter and the richest woman in Africa, as head of stateowned oil company Sonangol last November.

The bank clean-up is part of a push to restore credibility to a system damaged not only by cronyism but also by the collapse from 2014 in the price of oil, on which Angola’s economy heavily depends.

Mr Massano said that non-performing loans had risen dramatically, from 12 per cent a few years ago to 26 per cent, partly because of weak oversight, with banks lending to politically connected people on the instruction of the central bank.

That had now stopped, he said, along with the allocation of dollars to favoured clients — a process replaced by regular auctions.

“We want a sound financial sector in the country and we have to make sure that, especially when relating to external rules, people feel safer dealing with the Angolan banking sector,” he said.

US banks have terminated banking relationships with their Angolan counterparts in recent years, depriving them of access to dollars, because of the suspicion they were controlled by political interests.

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US stock futures lower ahead of Fed minutes PAN KWAN YUK

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S stock futures are trading lower on Wednesday as investors take a breather from the big rally in the prior session and await the minutes from the US Federal Reserve’s last policy meeting.

With about 90 minutes to go before the opening bell, futures for the S&P 500 were down 0.3 per cent. Those for the Dow Jones Industrial Average and the Nasdaq 100 were 0.4 per cent lower.

Technology is expected to be in focus once again on Wednesday. Strong gains in the sector, along with a string of better than expected earnings, helped the three stock indices notch up their biggest one-day rises since March on Tuesday and claw back some of last week’s bruising declines.

Among the movers in premarket trading, Netflix was up 11 per cent after the video streaming company last night delivered third-quarter earnings and subscriber growth that came in comfortably above analysts’ expectations.

United Continental was also 6 per cent higher after the carrier raised the bottom end of its full-

year earnings guidance despite higher fuel prices.

Investors will also keep their eyes peeled for the minutes from the Fed’s September meeting, which are due out at 2pm EST. The US central bank has been on the receiving end of Donald Trump’s criticism in recent weeks.

The president went on the attack again last night, calling the Fed his “biggest threat” as it was raising interest rates too fast.

The Fed has raised interest rates three times so far in 2018, with one more to come by yearend. Jitters about further rate rises have prompted a surge in Treasury yields this month, with the yield on the benchmark 10-year note briefly touching a seven-year high last week.

Traders will be scanning the minutes for any hints that the Fed could be ready to step up its pace of tightening. The DXY dollar index was 0.4 per cent higher, although Treasuries saw muted action. Yield on the 10-year, which moves in the opposite direction to price, was less than 1 basis point higher at 3.1615 per cent.

On the data front, housing start numbers will be released at 8.30am.

Netflix jumps as investors binge on strong third quarter Shares open up 8% after subscriber growth outstripped expectations PAN KWAN YUK

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t’s full stream ahead for Netflix’s stock on Wednesday.

Shares in the online video company jumped more than 8 per cent at the open as investors cheered Netflix’s blowout earnings and subscriber gains, which have helped allay concerns over slowing momentum that have dogged the stock in recent months.

The company behind hit shows such as House of Cards and Orange is the New Black added nearly 7m net new subscribers in the third quarter — exceeding the 5.3m Wall Street analysts were expecting and the 5m its executives had predicted three months ago.

Netflix also said it was expecting to add 1.5m and 6.1m domestic and international paid subscribers, compared to previous guidance of 1.35m and 5.2m.

The figures should go some ways to reassuring investors who fear Netflix might repeat a shock miss in subscriber additions in its second-quarter report in July, which sent its stock plunging.

“Upside in both third-quarter results and the fourth-quarter guide essentially . . . confirms our view that second-quarter softness did not reflect any fundamental change in the business,” said Doug Anmuth, an analyst at JPMorgan.

William Power at Baird added that international growth was especially encouraging. “The standout was the strong fourth-quarter international guidance,” he said.

“International growth remains broad-based, with the company calling out Asia as a growing con-

tributor.”

Despite Wednesday’s gains, the stock remains down 11 per cent from its June high of $423.20.

Shares are nonetheless up 93 per cent for the year, underscoring the scale of Netflix’s stunning rally, which in May briefly propelled the company’s market capitalisation above of that of Walt Disney to make it the most valuable media group in the US. Not everyone was blown away

by Netflix’s results, however. Analysts at Keybanc downgraded their rating on the stock to “sector weight” from “overweight”, arguing that they see limited upside to the shares.

“While we remain positive on Netflix’s opportunity to grow subscribers and revenue, we believe revenue growth and accelerating margin expansion are needed to drive substantial upside from here,” they wrote. “The latter has not developed at a pace that exceeds our expectations, which suggests upside is more limited.”

Cash burn could also be another headwind given the company’s frantic pace of spending on original content such as the series Maniac, which starts Hollywood A-lister Emma Stone and comic actor Jonah Hill.

Netflix forecast a free cash burn of $3bn this year and another $3bn in 2019 but expects an improvement after that.

Long term debt stood at $8.3bn as of September 30, up from the $6.5bn reported at the end of 2018. The amount spent on interest payments meanwhile totalled $291.6m for the first nine months of the year, compared to $238m for the whole of 2017.

Twitter releases 10m tweets from fake news probe Social media group publishes cache to allow independent analysis by researchers CAMILLA HODGSON

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witter announced on Wednesday it had released a data cache of more than 10m tweets from accounts suspected of being involved in disinformation campaigns, to allow it to be independently investigated.

The social media group said it was releasing all the accounts and related content associated with “potential information operations” — including those suspected of disseminating fake news to influence the latest US presidential election — that it had found on its site since 2016.

The data includes 3,841 accounts associated with a Russian troll farm, known as the Internet Research Agency, as well as

770 accounts associated with a second attempted influence campaign that Twitter said may have originated in Iran.

Twitter had previously disclosed the existence of the accounts and concerns about disinformation activity taking place on its website. In January, US senators asked Facebook and Twitter for “ urgent assistance” on what they believed was a Russian manipulation campaign.

“In line with our strong principles of transparency and with the goal of improving understanding of foreign influence and information campaigns, we are releasing the full, comprehensive archives of the Tweets and media that are connected with these two previously disclosed and potentially state-

backed operations on our service,” Twitter said in a statement on Wednesday.

The data dump includes more than 2m images, GIFs, videos and Periscope broadcasts, Twitter said, including activity dating back to 2009.

“It is clear that information operations and co-ordinated inauthentic behaviour will not cease.

These types of tactics have been around for far longer than Twitter has existed — they will adapt and change as the geopolitical terrain evolves worldwide and as new technologies emerge,” it said.

The company said it was investing in tackling such activity, but that independent analysis by researchers was also a “key step” towards better understanding potential threats.

Turkey returns to international debt market with new $2bn bond Debt sale comes as investor sentiment improves following tumultuous summer ADAM SAMSON AND PAN KWAN YUK

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urkey has returned to the international borrowing market with the sale of a $2bn dollardenominated bond, just days after Ankara sought to end a bitter row with Washington following the release of a detained US pastor.

The country, which has been looking to shore up its external funding position amid a punishing currency crisis, said it received $6bn in bids from 250 accounts in its sale of five-year debt. Investors in the US were the biggest buyers of the paper, accounting for 60 per cent, followed by the UK at almost a quarter. Turkish investors scooped up 5 per cent.

Investors demanded a higher premium than in deals earlier this year. The spread in yield against a comparable US Treasury was 4.48 percentage points, up substantially from an April sale of a 10-year bond, which priced at 3.37 points, and a January 10-year issue at 2.67 points.

The lira and Turkey’s bonds have both been hit in recent months amid concerns over the economy’s health. A spat with the US over the fate of detained US pastor Andrew Brunson led to the

imposition of sanctions on Turkish officials and triggered a further sell-off in the country’s currency.

“The ongoing current account adjustment and higher yields seem to have led some investors to take a more constructive look at Turkish assets,” said Luis Costa, a strategist at Citigroup.

He said Mr Brunson’s release was also seen as a “positive development”.

“Nonetheless, the overall sentiment towards Turkish assets remains skittish on the back of the challenging macroeconomic backdrop and large external financing needs, as the global environment turns less [emerging market] friendly,” he said.

In August, the lira reached a historic low of TL7.2149 to the dollar — down by 47.5 per cent since the end of 2017. It has recovered somewhat since then, but is still down by about a third for the year to date. The ructions have also hit Turkish equities, with the country’s benchmark BIST 100 index down 14 per cent for 2018 in local currency terms.

In a sign of investor angst, both S&P Global and Moody’s cut Turkey’s credit rating deeper into junk territory in August. Both

credit rating agencies had made reductions just months earlier, during the spring of 2018. Fitch has lowered Turkey’s rating once this year, in July.

Turkey’s $880bn economy is saddled with external debt that stands at about half of gross domestic product. Consumer inflation has boomed to 24.5 per cent as the plunge in the lira has made the cost of imports substantially more expensive.

The central bank was initially reluctant to take action to prop up the currency and tame inflation. A sharp interest rate rise in September has helped to improve sentiment, but some analysts have said it came too late.

Turkey’s economy has shown some signs of rebalancing recently. Data released last week showed the current account swung into a surplus in August for the first time in three years. The $2.6bn figure was a marked improvement from a deficit of as much as $7.8bn in December 2017.

Deutsche Bank, Goldman Sachs and Société Générale advised on Turkey’s bond sale. The proceeds of the issue are due to reach Turkish Treasury accounts on October 23.

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NEWS YOU CAN TRUST I THURSDAY 18 OCTOBER 2018

Opinion

The Nigerian gas market ERNEST AZUDIALU-OBIEJESI Dr Azudialu-Obiejesi is Group Managing Director, Nestoil Group

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am always pleased to be part of any conversation aimed at improving the Energy sector in Nigeria.

This is not only because I am a major player in this sector but because I hold the very strong view that this sector still represents the pivot on which dreams of Nigeria’s economic transformation lie.

The theme of this year’s Nigeria Gas Conference - “Shift to Gas Economy: Pace and Scale of Innovation” could not have come at a better time. Indeed this sector despite its very well documented potentials is in dire need of innovation from public and private sector play-

ers. Over the years, there has been no shortage of policies from the federal government to strengthen the gas sector and make it a major contributor to Nigeria’s GDP growth. In fact this was the thinking behind the Domestic Gas Supply Pricing and Regulatory Policy of 2008. Sadly, the audacious goal of having the gas sector contribute up to 10% to Nigeria’s annual GDP has yet to materialize. Inadequate investment in upstream gas development, pipeline and other related infrastructure has resulted in both inadequate aggregate gas supply and several stranded gas assets across the country.

The well-intentioned plan to set up Central Processing Facilities (CPF) in 3 franchise areas has also not worked because of the obvious limitations in the commercial arrangements driven by government and International Oil Companies (IOCs). Government may need to review the existing CPF franchise arrangement and

invite indigenous companies to drive the gas processing infrastructure that will serve as the building block of a re-

‘

I am of the very firm belief that if the liquidity issues in the power sector are resolved, the gas supply industry in Nigeria will experience a boom and the need for price regulation and other forms of government interventions would diminish

,

loaded Nigerian Gas Master Plan (NGMP).

Furthermore, the thinking behind the Domestic Gas Obligation (DSO) in the present policy framework is commendable as it shows Government

truly wants to stimulate growth of the domestic gas market.

Has this worked? The answer is a resounding No if you are on the gas supply end of the value chain.

As you well know, the power sector accounts for over 80% of the domestic gas off take market. Liquidity issues in the power sector means that gas producers are owed huge sums of money for gas they have supplied. Furthermore, they cannot get the required financial securitization to invest in additional supply of gas to power generating companies (Gencos) even if the infrastructure were in place.

As a player in the power sector, I am very conversant with the liquidity issues bedeviling that sector. I am of the very firm belief that if the liquidity issues in the power sector are resolved, the gas supply industry in Nigeria will experience a boom and the need for price regulation and other forms of government interventions would diminish.

Gas flaring is the result of

these obvious gaps in the gas industry. Despite the best efforts of government, the menace of gas flaring continues to linger.

The recent Gas Flaring Regulation embedded in the 2017 Gas Policy is an audacious and innovative step by government to discourage gas flaring. Apart from increasing the penalty for flared gas to $2/mscf, the policy seeks to commercialize the utilization of flare gas through 3rd party investors. This is quite commendable but I doubt that it is far reaching enough.

This is still akin to treating the symptoms rather than the root cause. A permanent solution would be to address the liquidity issues in the downstream and power sectors to encourage much needed investments in gas gathering infrastructure that would eliminate gas flaring.

Everyone agrees that a willing-buyer-willing seller arrangement is what will ultimately unbundle the gas industry in Nigeria and across the West Coast but government

must be ready to make the right seed-investments and take the tough decisions that will enable the gas supply market grow into maturity. Price regulation cannot stimulate the right investments in the gas sector.

Finally I must call on government to continue to encourage indigenous players in the Oil and Gas industry. OML 42, which we acquired in 2011, was fraught with a lot of challenges at the time it was sold by the IOCs. We are proud to announce however that gas production of 40MMScf per day is set to be introduced to the domestic gas supply network by the end of this week with another 40MMScf per day being targeted for end-November 2018 for a total of 80MMScf per day by the end of this year.

Furthermore, theNPDC/Neconde JVis working on projects that will supply 280MMScf/d by 2021. Examples of similar feats by indigenous companies abound in the industry. We can do it.

MTN vs the government: Is poor communications hurting Nigeria’s economy?

NKIRU BALONWU Dr. Balonwu is Chair of African Women on Board (AWB), and Managing Partner at RDF, a Strategic Communication and Stakeholder Engagement Firm that provides strategic counsel to Public and Private Sector Institutions and C-suite Executives.

N

igeria is MTN’s biggest market in Africa, representing almost one-third of the telecommunication company’s total annual revenues.

Yet relations between the South African-held company and the Nigerian market have become increasingly fraught in recent years, with talk of the US$15Bn+ group pulling out of operations in Nigeria altogether. The dispute may have wider ramifications for the Nigerian economy, namely that the poor communications between MTN, the Nigerian government and financial institutions could be sending a damaging message to potential foreign investors.

From labour union protests, to hefty fines by government and communication regulators, including the Central Bank of Nigeria (CBN), MTN’s relationship with the

Nigerian market has deteriorated steadily in recent years.

In 2016, the repatriation probe of MTN first made mainstream news, with accusations of the mobile service provider allegedly illegally repatriating $13.9 billion in dividends over a period of 10 years.

When it rains, it pours. It seems that MTN’s troubles are not quite over, with a new $2 billion-dollar tax demand from the Attorney General of the Federation and Minister of Justice, allegedly relating to the importation of foreign equipment and payments to foreign suppliers over the last 10 years. it is a matter of debate whether Tax collection is within the purview of the AG’s office.

MTN, in its reaction, described the latest demands by the Nigerian authorities as ‘regrettable and disconcerting’.

When multiple institutions such as the Nigerian Communications Commission (NCC), the Nigeria Labour Congress (NLC), the Central Bank and the Attorney General’s office are clamouring over themselves to probe into the finances of a single company, the interest is unlikely to be coincidental.

Administrative conditions, political headaches and the infrastructural dearth make operating in the Nigerian market notoriously difficult, for foreign and local entities alike.

MTN’s massive wealth makes it a particularly large carrot for the country’s regulators, with officials arguing, as early as the beginning of 2016, that a successfully collected $13.9billion repatriation bill “could pull Nigeria out of recession”. All of this undoubtedly makes MTN a lucrative target for regulators

seeking revenues.

But the company has not exactly shown itself to be the patron saint of multinationals in Nigeria over the years, and of course effective communications works both ways.

Research from management consultancy firm McKinsey has shown that global firms are still not doing enough to properly ingratiate themselves with local governments and regulatory bodies: “Governments and regulators are second only to customers in their ability to affect companies’ economic value.” For better or for worse it is a good idea for all businesses, particularly big businesses, to keep this advice in mind.

MTN has incurred multiple accusations of arrogance, poor service delivery, and noncompliance with labour laws.

The Central Bank of Nigeria has stepped in, indicating that Standard Chartered Bank, Citibank Nigeria Limited, Stanbic IBTC Bank Limited and Diamond Bank Plc helped MTN to repatriate funds back to South Africa illegally.

At the time of writing, Standard Bank has now withdrawn its MTN Nigeria-related cautionary for shareholders, on the back of correspondence from the CBN. And so the saga continues.

But the real damage from the poor communications between both sides is not to each other, but rather to the wider Nigerian economy as an investment opportunity in the eyes of the international community. While other countries are trying to woo businesses and heads-of-states - sending the right signals to foreign investors, domestic and overseas entrepreneurs,

Nigeria seems to be doing the opposite. Public bureaucracy and regulations remain the main obstacles towards a more dynamic economy and even if the CBN is correct in its claims, could it have communicated them better?

Speaking through its Chairman, Gbenga Adebayo, the Association of Licensed Telecoms Companies of Nigeria (ALTON) has called for an amicable resolution to this latest round of disputes ‘in the best interest of our member and that of the larger industry’.

And it is this plea that should be at the forefront of thinking for all invested parties in the matter. At a time when French President, Emmanuel Macron and UK Prime Minister, Theresa May, have recently visited the country,

‘

But the real damage from the poor communications between both sides is not to each other, but rather to the wider Nigerian economy as an investment opportunity in the eyes of the international community.

While other countries are trying to woo businesses and heads-of-states sending the right signals to foreign investors, domestic and overseas entrepreneurs, Nigeria seems to be doing the opposite

,

firmly focused on increased trade relations with Nigeria, the timing of this internal spat could not be worse for public relations. Nigeria is airing its dirty laundry in public, at a time when the eyes of the international investment community are firmly fixed on Africa as the next potential area of significant growth and partnerships.

Conspiracy theories are also beginning to swirl around the MTN saga, with critics in some quarters calling this latest controversy an attempt by forces around the government to destabilise Nigeria ahead of the country’s next round of elections. While this seems highly implausible, it highlights the makeshift narratives that are created by the public when organisations forgo tangible communications plans. In an age of fake news and ‘alternative facts’, having no official narrative can leave companies particularly vulnerable to unfounded chatter.

This lack of focus on serious communications is actually highlighted especially by the CBN. The recent leak of its 4-page letter demanding repayment from MTN not only represents poor communications, but also raises red flags on confidentiality and information security, sending negative messaging out both domestically and internationally. The fact that MTN shares fell 23% to a nine-year low on the back of the CBN’s latest probe can hardly have helped future interactions.

The bottom line is that government and financial institutions alike, as well as business giants like MTN, need to do a much better job

of managing their domestic and international communications, and remember that they are not only communicating with themselves, but also to the outside world. Coupled with greater credibility, these entities can serve more effectively as a body for informing the public and advising other institutional bodies in their decision making.

In recent years, many central banks around the world have significantly changed their approach to the public.

It has been shown that through more effective sharing of information, higher transparency and improved communication of their policy decisions and forecasts, they have a greater role in economic and structural reforms and policymaking. Mark Carney’s high-profile role in the UK’s recent financial discussions around Brexit springs to mind.

For such institutions to garner greater trust in Nigeria, and on behalf of Nigeria throughout the wider world, they must first seek to communicate more positively not only with clients and customers but also between themselves.

In recent days, we have seen signs that a more accommodating tone is now being taken, particularly from the side of the CBN. But should things have really come to this public display of disharmony? Until the Nigerian government, as well as the domestic and multinational companies that operate in the country, begin to approach their communications more professionally, and engage all involved stakeholders more effectively, we run the risk of putting off foreign investment, rather than attracting it.

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