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news you can trust I **TUESDAY 19 NOVEMBER 2019 I vol. 19, no 438

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Nigeria’s inflation rises the most in 17 months to 11.6% OLUWASEGUN OLAKOYENIKAN

L-R: Aliko Dangote, president, Dangote Industries Limited; Niyi Adebayo, minister of industry, trade and investment/special guest of honour; Kayode Falowo, president, Nigerian-British Chamber of Commerce, and his wife, Dorothy; Martin Sorrell, guest speaker; Agboola Ajayi, deputy governor of Ondo State, and Harriet Thompson, British Deputy High Commissioner, at the 16th presidential inauguration dinner of the NigerianBritish Chamber of Commerce in Lagos.

Rice farmers, millers ramp up production as Nigerians shift to local brands prices decline by 19% as harvest commences local milling capacity now about 5m MT, says RIPAN JOSEPHINE OKOJIE & BUNMI BAILEY

igeria’s rice farmers and millers who struggled in the past to sell their products are now smiling to the bank as Nigerians are

forced to shift preference to local rice varieties, according to BusinessDay investigation. The rising demand means the farmers and millers are now having to ramp up production to meet the ever-increasing demand for

rice, a key staple in Nigerians’ diet. The price of rice rose suddenly following the closure of the land borders by the Federal Government but it may have peaked, forced down in the last 10 days by an unusually heavy harvest by rice

farmers across the country. It is pushing millers with an estimated capacity of near 5 million tons annually to expand operations. “A whole lot of rice farmers are increasing their production areas because there is a huge market for paddy since the border closure,” Aminu Goronyo, national presi-

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igeria’s inflation rose to a 17-month high in October as sustained food shortage amid growing demand, coupled with its resultant effects, pressured consumer prices higher. The measure of composite changes in the prices of consumer goods and services increased by 11.61 percent in October from a year earlier compared with 11.24 percent in September, the National Bureau of Statistics (NBS) said on Monday. This is the highest October inflation since 2008, and the same inflation rate recorded by Nigeria in May 2018 when the Central Bank of Nigeria (CBN) kept the country’s interest rate at a record 14 percent to tame the macroeconomic variable. “The factors driving inflation

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Inside Kogi/Bayelsa guber: Large-scale violence re-echoes need for electoral reforms P. 2

Tuesday 19 November 2019

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news Nigerian universities lose more students to US schools’ open-door policy …as number of citizens in US varsities hits 7-year high …13,423 Nigerian students pay N124bn per session STEPHEN ONYEKWELU & BUNMI BAILEY

T L-R: Grand Judges: Strive Masiyiwa, group founder/executive chairman, Econet; Jack Ma, founder, Alibaba Group; Ibukun Awosika, chairman, First Bank of Nigeria Limited/founder, The Chair Centre Group, and Joseph Tsai, executive vice chairman, Alibaba Group, at the grand finale of Jack Ma Foundation Africa Netpreneur Prize held during the Netpreneur Africa Summit in Accra, Ghana

Kogi/Bayelsa guber: Large-scale violence re-echoes need for electoral reforms ODINAKA ANUDU & INIOBONG IWOK

…Bayelsa holds lessons for politicians

he conduct of last Saturday’s gubernatorial elections in Kogi and Bayelsa States again brings to the fore the urgent need to overhaul Nigeria’s electoral system. It underscores the urgent need for electronic voting and for President Muhammadu Buhari to immediately sign the Electoral (Amendment) Bill. Both gubernatorial elections were won by the candidates of the ruling All Progressives Congress (APC). However, reports from major local and international observers who monitored the elections show the level of violence by supporters of Nigeria’s two leading political parties, the APC and the People’s Democratic Party, has put a dent on the credibility of the polls. YIAGA Africa and the Situ-

ation Room alleged that the elections were marred by votebuying, ballot box snatching and intimidation of voters and specifically called for the outright cancellation of the governorship and senatorial elections in Kogi State. The observers said the election was not a reflection of the wishes of the people. The main opposition PDP also rejected the outcome of the elections, saying that security agencies colluded with the ruling party to rig the election in their favour. Elections in Nigeria have become increasingly prone to violence. A final report on the 2019 general elections by the European Union Election Observation Mission had said the elections were marred by violence and intimidation with the role of security agencies becoming more contentious as the process progressed.

Pundits say the situation may not change in the next few years if urgent steps are not taken to reform the nation’s electoral system, punish political offenders and remove the control of the Independent National Electoral Commission (INEC) from the executive arm of government. “Personally, I think we are just deceiving ourselves,” Ayo Adebanjo, elder statesman and leader of Afenifere, a panYoruba group, said. “I have said it several times that we are not serious about conducting elections in this country. This is not an election. We have to change the present constitution and remove INEC from the control of the executive,” he said. Sanni Yabagi, presidential candidate of Action Democratic Party (ADP) in the 2019 Nigeria elections, said lack of punitive law and the inability

of INEC and security agencies to punish electoral offenders play a key part in the increasing violence and ballot-box snatching noticed in recent elections in the country. “The way forward is for Buhari to sign the electoral bill into law which would give way to electronic transmission of result. It would eliminate tampering of result. Also, the Electronic Offences Tribunal Bill should be passed into law by the National Assembly,” Yabagi said. At least four people were killed by political thugs in Kogi, including a nephew to Dino Melaye, a senator. Reports said five people were mowed down by thugs in Bayelsa State. Yabagi advocated for the scrapping of off-season election, saying that it was a part of the problem. “The off-season election should be scrapped. We need

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Banking sector’s total assets to hit N44.2trn, loans N16.1trn by end 2019 …deposits to reach N29.1trn HOPE MOSES-ASHIKE

anking sector’s total assets are expected to hit N44.2 trillion by the end of 2019, according the banking sector report by Afrinvest West Africa launched on Monday in Lagos. This figure represents 7.8 percent increase compared with N41.0 trillion in 2018. At the end of the first half of 2019, the sector recorded N43.7 trillion in total assets, the report said. “Total assets remain strong,” said Ike Chioke, group managing director, Afrinvest West Africa, while presenting the report with the theme ‘Beyond the Precipice…Pulling Back from the Brink’. The industry’s total deposits are expected to reach N29.1 trillion by the end of 2019, growing at 25.4 percent as against N23.2 trillion in 2018. Total deposits stood at N25.6 trillion in the first

half of 2019. The report showed that the total loan of the banking sector stood at N15.7 trillion in the first half of 2019 and is expected to hit N16.1 trillion by the end of the year. Charles Soludo, former governor of the Central Bank of Nigeria (CBN) and current member of President Muhammadu Buhari’s Economic Advisory Council, noted there was massive transformation compared with the numbers before banking sector consolidation. “In subsequent ones, let us look at where we are in terms of the depth of the banking relative to, even in comparison to Africa. I checked banking by asset size, percentage of GDP, I was struck as to how low we are even by African standard,” Soludo said. “Countries like Mauritius, Kenya, Senegal, Ghana and several others were much higher. That might have some www.businessday.ng

implication about saving the banking financial system and the kind of economy we want to be able to empower,” he said. Speaking further, Soludo said, “We had a dream of Nigeria becoming the African banking and financial centre. Now that we are actually integrating Africa to have Africa Continental Free Trade Agreement as it were, what kind of banking and financial system do we really need to be able to move the economy forward? “The question is, what should be the next level for the banking system and what should be the kind of disruptive change or changes that need to be adopted to be able to move the sector to that level that it is able to power the Nigerian economy and increasingly African economy?” Soludo expects the subsequent Afrinvest banking sector report to show the kind of banking sector to be seen in the next

five to 10 years. “I think it might be one way of pushing us in the direction of the further reforms and further changes, especially disruptive changes. I like the concept of disruptive changes. You can’t repeat the same thing over and over and expect a different outcome,” he said. Cost of governance, education, e-voting, sub-national revenue generation and other issues topped discussion at the panel session at the Afrinvest conference. Personnel expenditure is expected to hit N2.3 trillion by the end of 2019, which is 71.2 percent growth to revenue. Others who spoke at the panel session include Foluso Phillips, executive chairman and founder, Phillips Consulting Limited, Andrew Nevin, partner and chief economist, PwC Nigeria, Fatumata Soukouna Coker, founder, Ygroup Holdings and chairman, Afrinvest Securities Limited, and Tola Adeyemi, partner, KPMG.

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he number of Nigerian students seeking to acquire higher education in the United States of America has continued to increase, touching a seven-year high last year, according to the latest Open Doors report by the Washington-based Institute of International Education (IIE). Nigerians studying in tertiary institutions in the USA rose by 5.8 percent to 13,423 in the 2018/19 academic year from 12,693 in the 2017/18 academic year, according to the report published Monday morning. Data compiled and analysed by BusinessDay show this is the highest number of Nigerian students in the USA since the 2013 session. Nigerian students studying in the US have increased steadily from 7,316 in the 2012/2013 academic year to the current level. The increasing number of Nigerian students in US universities is despite the fact that average tuition fee in the US for the 2018/2019 academic year was US$25,620 (N9.2 million) per year, according to a report by College Board,

a US-based student support organisation. These 13,423 Nigerian students studying in the US are paying as much as US$344 million (N124 billion) per year as tuition fees. This is besides feeding, accommodation and transportation costs. “Most of the dollars that would have been conserved or used to import other things that we don’t have a comparative advantage in are spent on studying abroad. This puts pressure on our foreign exchange and reserves,” said Ayodele Akinwunmi, corporate banking department, FSDH Merchant Bank Limited. Education sector analysts have attributed this steady increase in the outflow of Nigerian students seeking post-secondary education abroad to a sustained fall in the standard of education at both federal and state-owned universities, incessant strikes and decaying infrastructure in Africa’s most populous nation. This is a vacuum private universities are struggling to fill but these universities also charge a premium for the perceived quality education they

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Land title delays may scuttle FG’s ambitious annual 1m housing target – Experts HARRISON EDEH, Abuja

ederal Government’s ambitious yearly housing targets of 1 million and initiatives of making affordable housing available to many Nigerians may hit the rocks if the sub-national governments continue to delay land titles. Nigeria has a housing deficit of over 17 million units, a problem which it has been trying to solve with various forms of initiatives, with the most recent effort being making available a housing cooperative loan fund, which seeks to ensure more people own their dream homes through a registered cooperative as a special purpose vehicle to access their own home. Babatunde Fashola, minister of Works and Housing, at the just concluded National Council for Housing and Urban Development, informed various state representatives at the meeting that they needed to register state cooperatives in order to access the cooperative housing loan domiciled with the Federal Mortgage Bank of Nigeria. “To drive this initiative forward, the state should be able to provide title, land @Businessdayng

and other necessary approvals,” Fashola said. Many real estate experts had lauded the initiatives, but had also raised concern that land title delays by subnational governments could scuttle the ambitious project since the land ownership structure according to the Land Use Decree vested ownership of land in the state. Most state governors take land as their own most priced asset and are not so readily willing to sign of Certificates of Occupancy within their respective state jurisdictions, an issue some analysts have said is not fast-tracking housing development across the country. “There is often a disconnect between what is done at the federal level and what we do at the state. There must be effective collaboration. For us to have he needed impact, we must ensure that the policies we initiate have a trickle-down effect with the sub-national government,” Ugochukwu Chime, a surveyor and president, Real Estate Developers Association of Nigeria, told BusinessDay.

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Presidency urges PDP to accept defeat with grace ...As Oshiomhole, APC Governors hail Jonathan over Bayelsa polls Tony Ailemen, Abuja

he Presidency on Monday challenged the main opposition People’s Democratic Party PDP to accept the party’s defeat in the just concluded Bayelsa and Kogi Governorship elections with grace The Presidency in a statement signed by Presidential Spokesman , Garba Shehu, reacting to accusation of fabricated results from the opposition party, noted that “the only fabrication is PDP’s conduct”. The statement, which came against the backdrop of allegations of intimidation and violent attacks against the opposition, especially in the Kogi election, noted that “ it has become standard procedure for the party to challenge any poll that does not return its candidates. Election is good when the PDP wins. The opposite is the case if any party other than the PDP wins. “Democracy is not only about who wins or who loses, but also about the process. In disparaging every unfavourable result, they disgrace themselves by casting aspersion on the entire system. “The February 2019 election saw the loss of five All Progressives Congress, APC governors. The government accepted the results. “In doing so, we realised that we did not win the argument in those contests, and so we didn’t win enough votes. We retired to assess what went wrong: were we responsive enough to the electorate’s needs and priorities? How can we improve on speaking to the nation’s hopes? We got ready and prepared ourselves well for the next contest. The result is a healthier, more rigorous election.” Presidency described the Opposition strategy of attacking the electoral commission, security agencies, government at the centre and the person

of President Muhammadu Buhari after each election loss, as “antithetical to healthy democratic norms” “Candidates and parties, especially those that have lost, are not told to examine their campaign tactics and strategies with a view to improving their chances for the next election. The result of not doing this is a loss for the electorate and for the parties concerned. The Presidency however, called on APC supporters to show dignity in victory, and for all Nigerians to remain peaceful in the wake of these elections. “We call on PDP to learn to be democrats. We must now come together to build a brighter future for Nigeria. But Chairman of the APC, Adams Oshiomhole, the Chairman of the APC Governors Forum, Atiku Bagudu and Jigawa State Governor, Abubakar Badaru, in a related development, commended the roles of former President Goodluck Jonathan in ensuring peaceful election in Bayelsa. Oshiomhole and the APC Governors who were also joined by the Minister of State for Petroleum Recourses, Timipre Sylvia, hailed the peaceful conduct that led to the emergence of David Lyon of the APC as the Governorelect. The APC leaders stated this while briefing State House Correspondents after leading the Governor- elect to meet behind closed doors with President Muhammadu Buhari, and described the election as the “ most peaceful election in Bayelsa since 1999”. Oshiomhole disclosed that President Buhari expressed his happiness with the results of the election in Bayelsa, even as he commended the warm reception accorded the Governor- elect by former President Goodluck Jonathan. Oshiomhole noted that the

Bayelsa election was a sharp contrast with the Kogi election that witnessed “ pockets of violence “ According to Oshiomhole “ President has charged the Governor- elect to work towards ensuring peace in Bayelsa as well as transform the economic fortunes of the state” The Governor- elect, David Lyon , assured that Security and economic development remain the key agenda his administration is committed to achieving in the state “I promised Bayelsans that we will serve them and not the other way round. “We will respect and ensure regular consultations with the elders of party, in implementing our cardinal objectives for our people” He also expressed his gratitude to President Buhari assuring that there will be serious positive development in the state. “I assure the people of Bayelsa that positive development is key to us and we will ensure that we do not fail Bayelsans Chairman of the election team and Jigawa state Governor, Abubakar Badaru. In his assessment of the election, attributed the success of the All Progressive Congress to the selection of the right candidate for the Governorship election and commended Timipre Sylvia for his leadership quality that culminated in the emergence of David Lyon Minister of State for Petroleum Resources, Timipre Sylvia, in his own assessment, noted that outgoing Governor Seriake Dickson made their job very easy by his actions. He noted that the APC victory has given the party not only a foothold in the oil rich region, but has enhanced its national outlook. He however, commended former President Jonathan for his fatherly roles

Reps summon NNPC, Solid Minerals, Water Resources Ministries over audit query ...Queries Perm Sec, Labour and Employment over missing vehicles James Kwen, Abuja

he House of Representatives has summoned Management of Nigerian National Petroleum Corporation (NNPC) over financial queries issued by the Office of the Auditor General of the Federation. Chairman, House Committee on Public Accounts, Wole Oke, issued the directive Tuesday during the investigative hearing held at the National Assembly complex, Abuja. He expressed displeasure over the absence of the representatives of the Agencies at the investigative hearing despite the adequate time given to them and directed the Com-

mittee’s Secretariat to ensure the presence of the Agencies by next week Monday. The Committee also queried the Permanent Secretary, Federal Ministry of Labour and Employment, William Nwankwo, over the alleged, “disappearance of two operational vehicles of the Ministry in 2015 under mysterious circumstances.” Oke stated that the audit query emanated from the 2014/2015 audit report of the Auditor-General of the Federation and issued to the Permanent Secretary. Responding to inquiries from the lawmakers, Nwankwo who assumed duties in the Ministry in latter part of 2016, argued that a retired Director, www.businessday.ng

he simply identified as Paul, took away the two vehicles as part of his retirement entitlements. According to the Permanent Secretary, it is lawful for such senior retirees of the Ministry to go with such vehicles upon retirement. The Chairman and other Committee members who were visibly angry over the disappearance of the two vehicles, said that the Permanent Secretary as the Ministry’s Accounting Officer should account for them. Oke told the Permanent Secretary that he was not speaking the truth on the matter and added that he ought to run after the missing vehicles until he retrieves them. https://www.facebook.com/businessdayng

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RSF 2019: RCN president calls for collaboration between organised, informal retail sectors Anthony Nlebem & Desmond Okon

he president of the Retail Council of Nigeria (RCN), Ashiwaju Solomon Kayode Onafowokan, has called for collaboration between the organised retail sector and the informal retail sector in Nigeria in order to develop the economy. Speaking through his representative, Kunle Hazmat, the Onafowokan made the call at the Retail Sourcing Fair (RSF) West Africa ,co-located with China Brand Show recently. The China Brand Show, which was a major highlight of the fair, was said to be its debut in West Africa in collaboration with the Ministry of Commerce of China of the People’s Republic of China. Commending the efforts of the organisers, Onafowokan said bringing other countries to Nigeria so that its economy can be developed and grow was critical since the economy is not doing so well currently. “Actually, there is no better time than now to have this kind of event. This is the time when the economy is not doing so well,” he said, adding that bringing other countries so that we can develop and grow ourselves was necessary. “Bringing China down to Nigeria, collaborating with them, ensuring we do great business with them will give us the opportunity to have China/Nigeria because at the end of the day, we’re looking forward to greater collabora-

tion that will eventually bring more businesses by way of establishing their businesses in Nigeria,” he said. The event was organised by a partnership between Atlantic Exhibitions and Leoht Africa with the aim of providing a route to market, market penetration and expansion strategies. The China Brand Show seeks to strengthen bilateral trade relationship between Nigeria and the People’s Republic of China. The focus of the event was “exclusively on connecting Nigerian and Chinese businesses, governments’ bodies and institutions to have in-depth onsite discussions on investments, business and trade opportunities,” said Bunmi Aliyu, executive director, Leoht Africa. RSF was described as a trade-only fair focusing exclusively on retail and commercial products for the home, office, gift, and textile sectors. Trade fairs or exhibitions, are fast becoming avenues for retailers and manufacturers to gain significant market exposure. This is clearly due to the growth of the industry propelled by Nigeria’s nearly 200 million population, with a fast growing middle and emerging middle class with a spending in excess of $100 billion (N36.2 trillion a year) a year. According to Global Retail Development Index, Nigeria is the leading retail market in Africa with a record of $125 billion on retail sales in 2016.

World Toilet Day: Minister advocates private sector participation James Kwen, Abuja

s the Federal Capital Territory Administration joins the rest of the world to celebrate the United Nations World To i l e t D ay ( W T D ) , F C T Minister of State, Ramatu Tijjani-Aliyu, has called for private sector initiatives to meet the 2025 Goal of ensuring that Nigeria becomes Open Defecation Free (ODF). Aliyu also called for greater commitment especially at a time when P re s i d e n t Mu h a m m a d u Buhar i’s administration has flagged off the Clean Ni g e r i a Ca m p a i g n w i t h use the toilet initiative. She decried the rate of Nig er ians w ith inadequate or total lack of access to toilets, revealing that the Federal Capital Territory has a fair of the over 47 million people lacking access to sanitation and hygiene. A c c o r d i n g h e r, “ N i geria currently has over 47 million people with inadequate or total lack of access to toilets and another troubling 57 million

lacking access to potable water. The FCT has its fair share of this disturbing figures. “ T h e re f o re, t h e 2 0 1 9 World Toilet Day is coming at a time that the federal g overnment is revving up the political will to combat this scourge through a number of tools and instruments, programmes and initiatives that include partnership w ith the organize d pr ivate sector in other to reverse the scourge and build a healthier Nigerian population. “It saddens my heart to note that currently 102, 000 children die annually due to diseases related to sanitation. We must join hands to reverse this ugly trend,” he said. The FCT Minister of State called on traditional r ulers and all residents of the territory to see themselves as ambassadors and embark on the crusade to educate others on the need to desist from actions such as op en defe cation and indiscriminate dumbing of refuse.

L-R: Ike Chioke, GMD, Afrinvest West Africa Limited; Betsy Obaseki, first lady, Edo State; Charles Soludo, member, Presidential Economic Advisory Council; Chamberlain Peterside, executive chairman, Xcellion Capital Advisors Limited, and Andrew Nevin, partner and chief economist, PwC Nigeria , at the Afrinvest 2019 Nigerian Banking Sector Report launch, themed, “beyond the precipice, pulling back from the brink” in Lagos. Pic by Pius Okeosisi

UI commissions Uduimo Itsueli Foundation, Folorunso Library to promote research for economic development MICHAEL ANI

he University of Ibadan recorded yet another milestone after it unveiled the Uduimo Itsueli Foundation and the Isaac Folorunso Adewole Library of Tomorrow (LoT) at the weekend. These projects are part of the university’s vision to make research play a significant role in Nigeria’s national development and improve the country’s academic ranking globally. Both projects were named after two of the institution’s alumni, Uduimo Justice Itsueli, chairman of the UI-Research Foundation, and Isaac Adewole, a former vice-chancellor of the university and a minister of health during President Muhammadu Buhari’s first term. Speaking on the commissioning, Abel Olayinka, a professor and vice-chancellor of the University of Benin, said the foundation showed UI’s drive towards producing leaders who can use research to address the challenges, capture the aspirations of the Nigerian people and chart the path for national development. “The University of Ibadan has taken the bold steps to invest in creating this platform that is necessary for continual renewal of the competencies of our students, faculty and staff, as efforts are being devoted to

support the research leaders as well as strengthen the pipeline with emphasis on early career research scholars as members of staff,” Olayinka said. According to him, the research foundation which is one of the recent developments in the institution represented the emphatic declaration of the commitment and assurance that the products of the university were not only fit to lead, but are also prepared to make knowledge a cornerstone and driving force for national development. The Uduimo Itsueli Foundation is situated at the Ajobode campus of the university and is one of the five structures designed to make the UI-research foundation complex a formidable platform to stimulate the contributions of research leaders at the university. Similarly, the Library of Tomorrow (LoT) named after the former minister is designed with the singular vision of serving as a sustainable platform for access to research information that can act as a driver of evidenced-based decision making, foster a knowledge economy and the socio-economic development of Nigeria. Olayinka explained that the LoT, which is the first in Nigeria, is envisioned to provide up-to-date and facilitated access to research information necessary to enhance competencies and competitiveness

of early career researchers and postgraduate scholars in research, grants funding, and effective utilization of research outputs for national development. It would also facilitate effective vehicles for information sharing to promote comprehensive contributions of all stakeholders towards pragmatic evidence-based policy options and effective utilisation of assets for national development; and lastly, create a gown-to- town platform as a forum for communal participation and contributions to priority setting and enhancing policy impacts. At the commissioning of the foundation, the institution created a “journal club,” a platform which it says would assist early career researchers, postgraduate research scholars, as well as research leaders to benefit from collegiate open discussions on research topics. The essence of the journal club is to allow people sit in an informal setting, do a critical review of published works which would have been selected, with each member of the group made to contribute and speak on what they have reviewed, said Ayoade Oduola, a professor and Director, University of Ibadan Research Foundation. “The idea is that through reviewing of other people’s work, they will be able to see the strength, the weaknesses

and the opportunity that abide in such a research that would help spur people to think about solving problems using a hybrid method which can be applied locally,” Oduola said. At its take-off, over 76 members across various disciplines were enlisted into the club, without any monetary fees attached to their membership. They are expected to interface with others outside the university. Uduimo Itsueli, Chairman of the UI Research Foundation and whose name the project is named after, tasked early researchers on the need to develop innovative original works that can have patents. He noted that research for the sake of theory alone would be of no use until such researches are used to improve humanity and that can be done by commercializing the results of such findings. “My involvement here is to see how I can collaborate with them so that whatsoever research the institute comes up with, we can make it beneficial to all who are not in the university,” he said. The commissioning attracted the presence of prominent people from all walks of life, including those from private and public sectors as well as government officials. Governors Adegboyega Oyetola of Osun State and Seyi Makinde of Oyo State were represented at the event.

Bello says electoral victory is for Kogi people who love true democracy …as he urges PDP to accept INEC’s verdict VICTORIA NNAKAIKE

overnor Yahaya Bello has thank the people of Kogi State for voting for him in the just concluded Saturday governorship election, describing his re-election as victory for true democracy. According to a press state-

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ment signed by Kingsley Fanwo, director-general, Media and Publicity, following INEC declaration of the APC candidate as winner of the poll, the governor is now spurred to do more for the state. “This victory is for Kogi people that value true democracy. And the people of

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Kogi will be assured that governor Bello will not abandon his campaign slogan which expresses his desire to do more for Kogi people. “We thank Kogites who voted for us. We also thank Kogi people who did not vote for us; they have challenged the governor to do more for them to earn their confi@Businessdayng

dence,” Fanwo said. “We also thank the party hierarchy for throwing their weight behind the governor. “We thank the Independent National Electoral Commission, INEC, security operatives and other public institutions for ensuring that the election was free, fair, credible and peaceful.

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In whose interest is Nigeria’s democracy? STRATEGY & POLICY

MA JOHNSON

or several years, I have been pondering on Nigeria’s democracy, opportunities and challenges it has brought to the nation in the past twenty years (1999-2019). In theory, the opportunities far outweigh the challenges. But in practice, the challenges are numerous and complex. Perhaps, that is why political scientists always say that democracy is a very complex endeavour. Although, democracy is a fallacy in practice, I love it more than any type of military rule. This is because in a democracy, the people are supposed to keep the government in check. Provided however, the people know what the government is doing. When Abraham Lincoln defines democracy as “the government of the people, by the people, for the people,” he was perhaps, referring to Western democracies. Lincoln’s definition of democracy doesn’t refer to democracies practiced by politicians of African genre. In the 1990s, some commentators and analysts expressed some condescending perceptions about Africans in their paperwork. For example, George Louis Beer, claimed “black race has hitherto shown no capacity for progressive development except under the tutelage of other peoples.” As if he was enhancing this derogatory assertion, he affirms that Africans existing stage of civilization in the Twenty-first Century is far below the potentialities for progress. Beer was not alone in this deroga-

tory remark about Africans. There were other commentators and analysts who painted an apocalyptic portrait of African nations in the early 1990s because of the immense human tragedy that pervaded the continent at that time under assorted military regimes. Of particular reference, is the statement made by one Paul Johnson, who opines that “some states are not yet fit to govern themselves, and so the civilized world has a mission to go out to these desperate places and govern.” He suggests further that individual “civilized countries would serve under his proposal as trustees.” These offensive remarks are irritants to Africans who have the love of their countries at heart. For them, these remarks appear xenophobic, and outrageous. But are these individuals not correct? Although, since Nigeria chose the path of democracy in 1999, there has been undulating progress made by successive governments in all areas of our national life. We thought with democracy, electoral processes will be strengthened. Rather than strengthen electoral processes, they are weakened by those who took an oath of office to defend the unity and uphold the honour and glory of the country. Many Nigerians accepted democracy because they assumed wrongly though, that it would build bridges and not walls between the rich and the poor. Our democracy has not given the poor any hope. Inflation and unemployment now make the poor more miserable. A visit to the backwaters of the country throughout the 36 states and 774 local government areas will expose the poor conditions of some roads. One would find out that most public health facilities are decaying just as many primary and secondary schools need urgent repairs and upgrade. It was in 2014 that Nigerians aligned themselves with a few politicians that there was need for change in governance as corruption and disregard for the rule of law were at their highest amplitudes. As you read this piece,

corruption and disregard for the rule of law still thrive in our society. That is why some analysts say Nigeria needs to be reformed politically and economically. But I was quick to ask: “Where are the reformers?” They are very scarce in our society and I doubt if they currently are in the government. The current economic challenges facing Nigeria today have been conceptualized, orchestrated and implemented since independence not by colonialists but by the political elites. I am aware that democracy alone will not solve all the problems of the nation with multiple ethnic, cultural, and religious backgrounds A careful study of current political and socio-economic challenges, gives an impression that the electorate was deceived with the “change” mantra in 2015. The masses fell for it. Even some Nigerians who knew these crops of politicians and their antecedents fell for their strategic deception during the 2019 general elections. I thought the primary question Nigerians should have asked politicians before going to the polls was that: whose values, beliefs, attitudes, or behaviour would require change in order to have a progressive Nigeria. Nigerians should have asked what shift in national priorities, resources, and power were necessary for development in the country? And what sacrifices would have to be made by whom, and for who, in order to actualize the desired change. We did not ask these questions. Thus, Nigerians missed the opportunity big time! After spending huge sums of money, Vision 20:2020 and the Economic and Recovery Growth Plan (ERGP) have just been abandoned. What an easy way of dumping a nation’s strategic plans. No one in the government deems it necessary to tell citizens what these plans achieved and what they did not realize as we look forward to Vision 2040. The challenges Nigeria is currently facing are numerous and could better be solved when we have committed and sincere leaders at all levels of

‘

We thought with democracy, electoral processes will be strengthened. Rather than strengthen electoral processes, they are weakened by those who took an oath of office to defend the unity and uphold the honour and glory of the country

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

FCCPC: Fighting many battles for the Nigerian consumer

espite their promise to investigate his complaint and get back to him, Timi had not heard back from the Customer Care Unit of the Abuja Electricity Distribution Company (AEDC) three weeks after he had sent them an email objecting to high bill estimates being sent to his two bed-room flat. Instead, AEDC disconnected his electricity, insisting that he must pay one hundred and sixty thousand naira or remain in the dark. Tired of trying to reason with AEDC, Timi decided to approach the Federal Competition and Consumer Protection Council (FCCPC) to seek redress. He headed to Twitter and posted a comment on FCCPC’s timeline which incidentally had many other conversation threads featuring customers’ complaints of abuses by service providers in various sectors. “Dear @FCCPCNigeria can you stop @Abujaelectricity form extorting me?” was all that his tweet said. And in about 4 hours, there had been 2 replies to Timi’s tweet: One from FCCPC, instructing AEDC to look into the complaint and asking Timi to send details of the matter to FCCPC’s email address. And another, from AEDC asking Timi to send a complaint email to their Customer Care unit so that the matter would be investigated. In the days that followed, Timi had a series of email exchanges with the AEDC Customer Care unit which eventually acknowledged that he didn’t owe any bills, and sent technicians to

reconnect his electricity. The matter has been forwarded to one of FCCPC’s case officers for investigation as Timi is seeking compensation for the inconvenience he and his family suffered. Timi’s experience is not an isolated case. It is one of many where FCCPC’s oversight has prompted a service provider to step up their response to a customer’s complaint. The commission obviously takes its job of engaging, listening and acting on public expressions of dissatisfaction seriously. This is evident in its Twitter feed which is full of conversation threads that feature instructions by FCCPC to specific corporate entities to do right by customers. And these organisations cut across various kinds of service providers including banks, restaurants, online shops, GSM companies, among others. In addition to timely interventions in disputes between companies and their customers, FCCPC is constantly urging service providers in all industries to enhance the quality of the systems through which aggrieved customers get redress. FCCPC Director-General, Babatunde Irukera has repeatedly urged companies to build sustainable systems for handling customer complaints as a strong first line response so that the commission will only intervene as a second level mechanism for complaint resolution. It will come as no surprise that electricity distribution companies (DisCos) are among the most mentioned in complaints to FCCPC from customers seeking redress because of the infamous problems in the electricity sector. Meters www.businessday.ng

PAUL K. ADEGBOYEGA

are a big issue. A survey conducted in 2017 by NOI Polls revealed that ownership of fixed prepaid metering was limited to only 9 percent of the population at the time this survey was conducted. According to the same National Survey, the rest of the population is divided among 41 percent who use post-paid meters and 50 percent who do not have any meter at all, but simply pay fixed amounts of money for electricity. Given these facts and the well documented greedy antics of some DisCo staff, service provision in the power sector is a highly contentious area. The frustrations of Nigerians with the quality and frequency of power supply is amply reflected in FCCPC’s public engagements. While speaking at a town hall meeting with consumers, Kano Electricity Distribution Company (KEDCO) and other stakeholders in September 2019, Irukera cautioned KEDCO against high bill estimates, popularly known as “crazy bills”. In response KEDCO’s Chief Customer Relations Officer, said the Distribution Company will act promptly on the complaints received from customers. In another town hall meeting organised by the Eko Electricity Distribution Company, EKEDC, Irukera described estimated billing as an abuse. “We used to have estimated billing in Nigeria before the Discos came on board, and it was not as contentious and discriminating as we have it now”. Speaking on disconnections, Irukera maintained that there was no acceptable combination of facts that would justify the group disconnection of electricity consumers where

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government. When all known indices of good governance are examined globally, Nigeria is always at the end of the ladder. Indeed, the reputation of Nigeria in the international arena is strained and embarrassing. Instead of democracy improving the quality of lives of the people, it has made many poor. Poverty experienced by Nigerians has reached a crescendo that some local analysts at a seminar asked: “In whose interest is Nigeria’s democracy.” In 20 years, democracy produced almost 90 million poor people only. Nigerians want to know what they stand to benefit in a democracy. Some Nigerians reason that democracy in Nigeria means “government of politicians, by politicians, for politicians only.” A fellow while expressing his views at the seminar says that “if governors and lawmakers serve for only 4 years and each go home with severance allowances and pensions, but public/civil servants who served the country for more than fifteen years or more are not been paid gratuity and pension on time, democracy is only for politicians.” For several months, there is an outrage in the country over senators’ N13.5 million monthly allowance. Such allowance to my mind does not match Nigeria’s circumstance as a technologically and industrially backward nation. That is why the ayes have it, when Senator Rochas Okorocha, the immediate past governor of Imo State advocated on the floor of the red chamber for a reduction in cost of governance declaring that instead of three senators per state, Nigeria should make do with one senator per state. Although the former governor is still battling with allegations of extensive property acquisition and extravagance in office, the Economic and Financial Crimes Commission has imposed sanctions on him. All said, it is still germane to ask: In whose interest is Nigeria’s democracy? Politicians!

there were some of the consumers that might have paid their bills. In addition to protecting consumer interest, the FCCPC is charged with ensuring that Nigeria has a competitive and healthy market for the betterment of the economy. As such, the commission’s posture is firm but fair. This was evident in its oversight of Africa’s largest pay TV operator, Multichoice. The commission has issued a final order to Multichoice in June 2019, after the company failed to comply with previous agreements reached with FCCPC. Among other things, FCCPC directed Multichoice to provide an option that would allow its subscribers suspend their active subscription. This is a significant intervention since Nigeria is said to be MultiChoice’s largest market accounting for over 40 percent of its subscribers. FCCPC has introduced an email portal dedicated to receiving and addressing reports of sexual harassment of university students. FCCPC’s role here is to gather credible intelligence to assist school authorities and other stakeholders take decisive action regarding sexual harassment, exploitation and other misconduct.

Note: the rest of this article continues in the online edition of Business Day @https:// businessday.ng Adegboyega is a policy analyst in Abuja

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Tuesday 19 November 2019

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Culture and African development Rafiq Raji

high level of trust is a cultural trait associated with rich countries. A low level of trust has been observed among African populations. The historical origins of mistrust in Africa has been traced to the slave trade. “Individuals whose ancestors were heavily raided during the slave trade today exhibit less trust in neighbours, relatives, and their local government.” The heterogeneity of African populations has also been attributed for its relatively lower level of trust. This is because “heterogeneity increases the likelihood of mis-coordination and distrust, reducing cooperation and disrupting the socioeconomic order.” Little wonder, cultural affinities matter more than national institutions in Africa. When ethnic groups partitioned across different African countries were compared in one

study, it was found that “there were no systematic differences in economic performance within split ethnicities whose partitions following independence would come to be subject to different national institutions.” And even while colonialist choices still underpin the institutional framework of most African countries, they are not of the kind to bring about a positive change in values. This is not the case in general. A study shows that these institutional choices were correlated with the mortality rate of European colonialists. Where the colonialists faced high mortality rates, as they did in most of Africa, they set up extractive institutions (e.g. slave trade). Where they did not, like the US, Australia and New Zealand, they settled and set up institutions that enhanced growth factors like the rule of law and thus encouraged investments. For instance, the British colonialist divide-and-rule strategy has been found to be detrimental to statebuilding in its former African colonies. Unsurprisingly, former British African colonies place greater store in their ethnicity than their European-imposed national identity. There

are some nuances in this regard, however. In areas close to capital cities, where incidentally European colonialists largely concentrated their developmental efforts, there is evidence of state capacity. But in areas far from capital cities, where state capacity is literally non-existent, ethnic institutions prevail and hence explain why the economic performance of partitioned ethnicities are similar despite being under different national institutional arrangements. For instance, using light density at night as a proxy for economic activity, one study finds a significant relationship between pre-colonial ethnic institutions (stateless ethnicities, petty chiefdoms, paramount chiefdoms, and pre-colonial states) and regional development in Africa. In other words, kingdoms, empires, chiefdoms and the like, that were in place before European colonisation continue to be relevant to African development. And the rigidities of these pre-colonial ethnic-based political centralizations explain the incapacity of some African states to exercise full authority over property rights, tax collections and monopoly of violence to this day.

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While colonialist choices still underpin the institutional framework of most African countries, they are not of the kind to bring about a positive change in values. This is not the case in general

Clearly, for better or worse, African ethnic institutions are a factor in its economic development. In light of these realities, ethnic institutions could very well be formalised to fill these gaps in state capacity. The case of Botswana suggests colonialism is not an excuse, however. Parsons & Robinson (2004) show how the majority Tswana tribe of Botswana had a relatively egalitarian and accommodative political structure before the arrival of colonialists. Whereas tribal loyalties were a huge obstacle to state formation in many other African jurisdictions under colonialism, and are adjudged to still be the case presently, the relative homogeneity of the Tswana’s pre-colonial political institutions in Botswana, which already integrated non-Tswana tribes almost seamlessly, made the transition to a unitary state almost a natural one. References are available at https:// rafiqraji.com/2019/10/31/culturedevelopment-the-case-of-africa/ “Dr Raji is chief economist at Macroafricaintel. He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @ DrRafiqRaji)”

What businesses need to know and prepare for: Discrimination against persons with disabilities (prohibition) Act 2018

he Discrimination against persons with disabilities (prohibition) Act, 2018 is an Act which provides for the full integration of persons with disabilities into the society and establishes the National commission for persons with disabilities and vests the Commission with the responsibilities for their education, health care, social and economic rights. The Act has laudable provisions, which in turn places obligations on corporate bodies and individuals. These obligations, no doubt has implications for businesses either as employers of labour or providers of goods and services. Some of the provisions and their implications will be looked at below. Provision of goods and services in a non-discriminatory manner: Section 1(1) of the Act provides that a person with disability shall not be discriminated against on grounds of his disability by any person or institution in any manner or circumstance. Section 9 of the Act further prohibits refusal to provide goods, services or facilities as well as provision of goods, services or facilities in a manner or under terms and conditions that would be discriminatory to Persons with disabilities. A combined reading of both sections indicate that businesses now have a duty to render services or provide their goods in such a manner that would not be discriminatory to persons with disabilities. Section 1 (2) provides penalties for failure to comply as a fine of N1,000,000 if the person is a body corporate; a fine of N100,000 or 6 months imprisonment or both if the offender is an individual. Section 1(3) of the Act also provides that the person against whom the crime or wrong is committed may maintain a civil action against the person committing the offence or causing the injury, without

prejudice to any conviction or acquittal. Provision of accessible premises: Section 3 of the Act provides that a person with disability has the right to access the physical environment and buildings on an equal basis with others. This implies that the physical structure of any premises including a business premises should such that would be easily accessible to persons with disabilities. It may appear that Section 4 of the Act limits the provision of the necessary accessibility aids such as lifts (where necessary), ramps and any other facility that shall make them accessible to and usable by persons with disabilities to a public building. However, section 8 indicates otherwise as it includes any building which a person with disability has a right or duty to access. Section 6 provides a transitory period of 5 years from the date of the commencement of the Act within which all public buildings and structures, whether immovable, movable or automobile, which were inaccessible to persons with disabilities shall be modified to be accessible to and usable by persons with disabilities including those on wheelchairs. Attending to persons with disabilities in queues: Section 26 provides that persons with disabilities shall be given first consideration in queues and as much as possible be attended to outside the queue. This means that whenever a person with disabilities is on a queue, he or she should be attended to before other customers. Also, efforts should be made on a best effort basis to attend to them outside the queue. The penalty for failure to comply is N50,000.00 or 6 months imprisonment or both. Specific requirements for road transport service providers: Section 11 of the Act provides for Road Transport service provid-

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ers to make available lifts, ramps and other accessibility aids to enhance the accessibility of their vehicles to persons with disabilities. They also have an obligation to maintain, repair or replace the aforementioned items as the case maybe. Drivers are also under an obligation to ensure that the vehicle comes to a stop to enable the persons with disabilities alight from the vehicle. Specific requirements for airline operators: Sections 14 and 15 provide that all Airline operators are to ensure the accessibility of their aircraft to persons with disabilities. They are to provide presentable and functional wheelchairs (emphasis mine). They are also to provide assistance on and off board in safety and comfort as well as ensure that persons with disabilities are given priority during boarding and disembarking. Airline operators also have an obligation to translate general information into an accessible format. This implies that general information in braille format and sign language needs to be provided for the visually and hearing impaired respectively. Priority when providing accommodation: Where a business is providing accommodation (both residential and business) for its employees or customers as applicable, it is required to give priority to persons with disabilities- Section 27. Right to work on an equal basis: Section 28 (1) of the Act provides that a person with disability has the right to work on an equal basis with others and this includes the right to opportunity to gain a living by work freely chosen or accepted in a labour market and work environment that is open. Every employer of labour is under an obligation to abide by this provision and ensure that it does not engage in practice that runs contrary to

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ULOAKU EKWEGH it. If a company contravenes subsection (1), the company commits an offence and is liable to nominal damages of a minimum N500,000 payable to the affected person with disability. Furthermore, any principal officer of the company involved in the violation is liable to N50,000 damages payable to the affected person with disability. Right to the award of general and special damages: In addition to the normal damages provided in the Act, the court can also access and grant special and general damages where there is a contravention of any of the provisions-Section 55(2). The provisions of the Act as stated earlier are quite laudable but one may wonder how some of these provisions will be implemented in a country where there is a huge infrastructural deficit. Also, enforcement in the Road transport sector which is somewhat unregulated and unsophisticated may be a challenge. Nevertheless, it is important that businesses avert their minds to these provisions and take necessary steps to do the needful in order not to incur heavy penalties that would end up impacting heavily on their bottom line. Ekwegh is a private legal practitioner with over 15 years legal experience in law firms and as in-house counsel. She is also a fellow of the Institute of Management Consultants. Email: uloekwegh@yahoo.com

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Tuesday 19 November 2019

BUSINESS DAY

EDITORIAL Publisher/CEO

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

Bashir Ibrahim Hassan

What Lagos can learn from New York

s Lagos adds a new port to its coastline, in Lekki, it can draw lessons from New York. Like New York, the population size and location of Lagos matters. Imagine if Lagos was an Olympic boxer – it would be a light flyweight with the punch of a professional heavyweight boxer. In terms of size, Eko, as it’s also known, is the most densely populated state in Nigeria. Economically, Lagos is punching above its weight. Nigeria’s cargo traffic, saddled on long vehicles that ply Apapa-Oshodi expressway, passes through Lagos’ terrifying go-slow. The depth of Lagos’ ports, its proximity to other parts of West Africa makes it a regional hub. And with over 21 million people the megacity is at the heart of the retail hotspot that is attracting local and foreign retailers, “an attractive market that can stand alone and also serve as a gateway to Western Africa” according to PwC. In the 18th century, New

York’s dominance, in the US and in the world, was the result of a superior port. Its port served as the catalyst of sugar refining, garment manufacturing, printing and publishing. It was also the first port of call for millions of immigrants. In other words, the port, while welcoming throngs of migrants, served New York to transit from a manufacturing city in the 18th century to the information global city it is today for finance, publishing and other creative industries. New York’s population size and location allowed manufacturers to ship raw and finished goods cheaply. Overtime, New York rose to become a dominant hub-and-spoke network for manufacturing and transportation thanks to the depth of its port and its access to canals, lakes and rivers. People, products and ideas, whether from abroad or locally made, passed through New York New York grew a ready-towear industry from its import of textiles from England. By the mid-18th century, New York had become the centre of mass-

produced ready-to-wear clothes. This importing-turned-manufacturing city relied on the factory system and mechanisation. Because garment factories, compared to textile mills, don’t occupy a lot of space they were better suited for a city where land was expensive. Besides, improved infrastructure, better skills, proximity of suppliers in the Garment District, the garment cluster in New York, helped it maintain 100-year dominance. Nigerian retail fashion businesses can also learn from New York’s garment industry: forget about textile manufacturing, make ready-to-wear clothing catered to local demand and tastes. But New York lost its huband-spoke/manufacturing advantage, eventually, when containers transported by trucks replaced ships. But it reinvented itself. Today, New York is a global finance capital thanks to the financial and businesses services e.g. bankers, lawyers, accountants, insurers that served the shipping industry. The New York advantage: a hub that served markets, home

and away, continues till today. To really benefit from its density, Lagos needs to reduce the cost of moving people or goods within and through the city. Expensive land and high rents in Lagos are not an advantage for manufacturers. Transport, therefore, is critical. For instance, an inter-modal transport system eliminates distance to and from factories in Agbara Estate or Ibadan. So, even if manufacturing companies leave Lagos (rents and land prices drive manufacturers to neighbouring Ogun State), its social-tie density, that is, opportunities for people to meet and mingle and make things happen will be an asset. Reducing physical distance allows a city packed with people to exchange ideas and information. The fast flow of knowledge, whether in Victoria Island (the finance hub) or Shomolu (the printing hub), will make Lagos an information hub. Information is the creative capital of cities like Lagos and New York – think social networks.

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

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Tuesday 19 November 2019

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‘Their house is on fire’: The pension crisis sweeping the world The plunge in interest rates since the financial crisis is wreaking havoc on fundsand bond market weakness could add to the pain Josephine Cumbo and Robin Wigglesworth

an-Pieter Jansan, a 77-year-old retiree from the Netherlands, had high hopes for a worry-free retirement after having saved diligently into a pension during his working life. But Mr Jansan, a former manager in the metal industry, has been forced to reappraise his plans after receiving notice from his retirement scheme, one of the Netherland’s biggest industrysector funds, of plans to cut his pension by up to 10 per cent. Understandably, the news has hit like a sledgehammer. “This is causing me a lot of stress,” says Mr Jansan, who retired 17 years ago and hoped to use his pension pot to treat his grandchildren and afford good hotels on holidays. “The cuts to my pension will mean thousands of euros less that I can spend on the family, and the holidays we like. I’m very angry that this is happening after I saved for so long.” Mr Jansan is not alone in experiencing pension pain. Tens of millions more pensioners and savers around the world are facing the same retirement insecurity as Mr Jansan as plunging interest rates since the financial crisis wreak havoc on the funding of schemes. Pensions have become a defining political issue in countries as diverse as Russia, Japan and Brazil. General Electric, the US industrial conglomerate, recently announced that it is joining a growing list of companies that are ending guaranteed “final salary” style pension schemes, affecting around 20,000 of its employees. In the UK, tens of thousands of university academics are preparing to take strike action over steep rises in their pension contributions. A common factor in this global pension upheaval has been suppressed

bond yields. Bonds have historically provided a simple match for the cash flows needed to be paid out to the members of retirement schemes such as Mr Jansan’s. But decades of declining bond yields have made it far harder for pension funds to buy an income for their members, pushing them more into equities and other riskier, untraded investments, such as real estate and private equity. Buoyant financial markets have so far ensured robust investment gains for pension plans on their existing holdings. Yet given their long-term liabilities, the dimming outlook for future gains is causing anguish. A graphic with no description “Their house is on fire,” says Alex Veroude, chief investment officer for the US at Insight Investment, which manages money on behalf of many pension funds. “And rates can and probably will go lower from here. Even if the house is on fire, it’s still only the first floor. We think it can hit the second and third floor as well.” This is not merely a danger to individuals like Mr Jansan who may see their pensions cut — it could also have a wider impact on the economy. If people set aside more money for retirement, it may hamper economic growth by reducing consumption — the opposite of the intention of central banks when they cut rates. The Swedish Riksbank hinted obliquely at this when it recently signalled it would lift interest rates back to zero by the end of the year, saying that “if negative nominal interest rates are perceived as a more permanent state, the behaviour of agents may change and negative effects may arise.” There may even be more systemic consequences. Last month the IMF warned in its annual report on global financial stability that the rush by pension funds into “illiquid” assets will hamstring “the traditional role

they play in stabilising markets during periods of stress”, as they will have less money available to scoop up bargains. The push into more unorthodox investment strategies is worrying some in the industry, who warn that they could exacerbate market downturns. “We’re seeing some really unusual behaviour, and we’ll see some payback,” says Con Michalakis, chief investment officer of Statewide, an Australian pension plan. “The trillion dollar question is when? I’ve been doing this for long enough not to want to predict when it will happen.” When Christopher Ailman studied for a degree in business economics at the University of California in the late 1970s, Federal Reserve chairman Paul Volcker was ratcheting up interest rates, sending bond yields spiralling higher. Soon after he graduated in 1980 the 10-year Treasury yield hit a record of nearly 16 per cent — and the concept of sub-zero yields seemed preposterous. “At school my textbooks said that there was no such thing as negative interest rates,” says Mr Ailman, now chief investment officer at Calstrs, the $238bn Californian teachers’ pension plan. “But here we are.” In the wake of the financial crisis, many central banks deployed unconventional new tools to reinvigorate the global economy once interest rates hit zero. At first this primarily meant massive, multitrillion dollar bond-buying programmes, but in 2009 Sweden became the first central bank to experiment with negative interest rates. It was later followed by Japan and the rest of Europe, with the desperate scramble for bonds pushing yields lower. Growing concerns over the health of the global economy, a subdued inflation outlook and expectations of even easier monetary policy have now pushed the pile of negative-yielding debt to more than $13tn. Pension plans invest in a broad array of asset classes, but with many stock

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The trillion dollar question is when? I’ve been doing this for long enough not to want to predict when it will happen

markets at or near record highs, the prospect of gains are dimming across the board. AQR Capital Management estimates that the classic 60-40 balanced equity-bond fund might return as little as 2.9 per cent on average a year after inflation over the next decade, compared with an average of 5 per cent since 1900. “Higher prices are simply pulling forward ever more future return to the present,” says Andrew Sheets, a strategist at Morgan Stanley. “That’s great for today’s asset owners, especially those close to retirement. It is much less good for anyone trying to save, invest or manage well into the future, who face an increasingly barren return landscape.” The tumble in bond yields is particularly problematic for “defined benefit” pension plans, which promise members a specific payout. They use high-grade bond yields to calculate the value of their future liabilities, and every small move downwards deepens their funding challenges. A one percentage point fall in longterm interest rates will increase liabilities of a typical pension scheme by around 20 per cent, but the value of their assets would only go up by about 10 per cent, estimates Ros Altmann, a former UK pensions minister. “Clearly, then, scheme funding will deteriorate and employers will need to increase funding,” she adds. Many UK pension schemes are now using sophisticated “liability driven investment” strategies, hedging against the impact of lower rates on their liabilities. This has slowly started to catch on in Europe and the US as well. But those schemes that have not taken steps to guard against interest rate risk now face huge increases in their deficits, and are having to make difficult decisions about how to bridge the funding gap. FT

Double 11 record sales signal strength of Chinese consumption

n Monday, Alibaba’s Single’s Day broke all records. Chinese consumption and ecommerce signal not just continued resilience but evident strength. By 5 pm on Monday Alibaba Group had already broken last year’s record of $31 billion. And at midnight, the new record soared to $38.3 billion – 25 percent higher than last year. Despite the continuing - and misleading international headlines about China’s “slowing economy” and “consumption collapse,” Alibaba’s 11th Single’s Day gala alone generated more revenues than US Black Friday and Cyber Monday combined. Alibaba’s Singles’ Day shopping festival is not just the world’s largest of its kind. It is a vital barometer of Chinese consumption amid the US tariff wars. Double 11 is regionalising and internationalising According to Alibaba, more than 200,000 brands participated in the 11th Singles D - ay promotion – or the “Double 11” as it is popularly known - with 1 million new products being offered and over 500 million users forecast to spend; that’s 100 million more than last year. This year Alibaba deployed its highly popular online shopping platforms, Tmall and Taobao, but also business-to-business ecommerce platforms, like AliExpress, and Lazada, the shopping site favoured in Southeast Asia. As business began, the top regions in mainland in terms of transactions were Guangdong,

Zhejiang, Jiangsu, Shanghai and Shandong. However, Alibaba is also tapping regional, even international consumers. In the early hours, the most active overseas buyers included Hong Kong, the US, Australia and Japan. Even before the festival on Monday, some 64 brands, such as Apple, Lancome, Dyson and L’Oreal, garnered millions of dollars in Alibaba pre-orders, with Estée Lauder garnering a record $143 million. Double 11 is now a big win-win opportunity not just for China but for international exporters from advanced and developing countries alike. Ecom success reflects Chinese costefficiency, innovation In China, ecommerce explosion began in the mid-2010s. But as business has mobilised in the past half a decade, transactions occur smoothly with smartphones and volumes are soaring. Today Chinese consumers use smartphones to browse top online shopping sites, such as Alibaba’s Taobao.com, and submit orders. It is the net effect of 15-20 years of innovation by Chinese smartphones, mobile operators and ecommerce giants. In the early 2000s, NTT DoCoMo probably had the best mobile services, but since the Japanese operator failed to internationalise, it lost its edge. The Finnish Nokia developed popular 2G, even 3G services, but moved too slowly into smartphones. That’s how Apple’s iPhone captured the

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early lead in smartphones. Yet, it could not respond to a new generation of Chinese smartphones by Huawei and its peers - Xiaomi, Vivo, and Oppo – which now dominate 75 percent of the global smartphone market and are more cost-efficient and more innovative. Nor could the US companies, despite their early lead in the fixed-line Internet, match the co-innovation of Chinese operators and ecommerce giants, such as Alibaba. That’s why Chinese pioneers are already launching 5G services, while pioneering 6G platforms. And that’s also why the White House keeps resorting to anti-competitive means seeking to undermine Huawei’s legitimate success. Explosion of Chinese online consumption Through the 16 months of US tariffs, international headlines have predicted doom and gloom in China. And yet, Chinese industrial production picked up in September, despite reduced export growth. Third-quarter data reflected resilience of consumption. And while US trade wars have made consumers costconscious, retail sales climbed to 7.8 percent, thanks to slate of policy supports. Alibaba’s success and the new Double 11 record mimic the broader consumption trends in China. The same goes for urbanisation. As the growth momentum in the mainland has been shifting from the coastal first-tier cities to lower-tiered cities, gains in purchasing power in small-and-medium size cities drove

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Dan Steinbock Double 11 sales. When Alibaba’s ecommerce gala began on Monday, the China International Import Expo (CIIE) had just ended in Shanghai. In that bonanza, the value of intended deals exceeded $71 billion, up 23 percent from the first expo in 2018 – mimicking Alibaba’s sales triumph. The Double 11 and Shanghai CIIE records and the consumption data in the past few quarters offer abundant evidence that Chinese consumption is far more resilient and stronger than ideological headlines in the West presume. The author is the founder of Difference Group. He has served at the India, China and America Institute (US), Shanghai Institutes for International Studies (China) and the EU Centre (Singapore). Dr. Steinbock is an internationally recognised strategist of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute (US), the Shanghai Institutes for International Studies (China) and the EU Centre (Singapore). For more, see https://www.differencegroup.net/

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Tuesday 19 November 2019

BUSINESS DAY

Media business Changing Workplace: Forum advocates engagement, understanding of ‘millennials’ for optimal performance Daniel Obi

any organisations are today struggling with changing culture in workplace since the millennial generation – individuals born about mid 1980s to 2000s –started entering the workforce, but a forum on Employee Innovation and Workplace Millennial strongly advised organisations for proper engagement and understanding of the millennial to achieve productivity. Today, some of the millennial generation don’t want to be employees but partners in the business while some are not constrained by the 30 days working attitude of Generation X who are too invested in the system. The forum which stimulated conversation on the millennial who appreciate self-management, selfdetermination and work-life balanced environment was how to get the best out of them in the workplace. The forum which held in Lagos over the weekend under the aegis of the Employee Marketplace Initiative was a gathering of top corporate leaders. The convener, Nduneche Ezurike, a Marketing Communication Specialist and Head of Brand Communication in one of Nigeria’s commercial banks presented his research on Workplace Millennials and Enterprise Innovation. At the forum, the business leaders noted that proper understanding and engagement of the millennials and taking advantage of their digital

knowledge in the workplace will engender innovation and impact on business growth. Participants at the forum noted the existing inter-generational gap in the workplace and believed that proper integration of Generation X with the millennials will equally ensure productivity. To build a deeper relationship and much more harmonious environment in a workplace, Nduneche in his presentation strongly advocated for mentoring which is critical in the workplace. He said for organisations to mediate and moderate the inter-generational gap, there should be reverse mentoring module. “Reverse mentoring speaks about the younger ones that are digitally savvy supporting the older ones and at the same time learning from them”. On further steps to enable workplace innovation and business growth, he suggested for ‘innova-

tion tournaments’ which brings teams together. “Employees are formed into teams according to their level of interest and they challenge themselves to produce things of interest and when they do that they are celebrated”. There should also be fun and gaming models into the workplace. People want to be rewarded on the spot and when this happens they lay less emphasis on promotion . “This grows skill and brings value in terms of motivation and enables the employees to earn while they work”. Nduneche who underscored the importance of engagement in the workplace said “The fundamental of his research is to ensure how organisations can maximise their productivity through employee engagement. It is recognised that hard work brings productivity but engagement brings innovativeness”. He said employee engagement has been a trend in most organisa-

Lagos NIPR drives operational improvement with rewards to practitioners, organisations Daniel Obi

ith deep understanding that reward and recognition push for continuous improvement in people and organisations, Lagos Chapter of Nigerian Institute of Public Relations NIPR will next month recognise and reward marketing communication professionals and companies that have excelled on their jobs. “These are individuals and organisations that have served as leaders and source of inspiration in the industry, raising standards, redefining and expanding the roles of communication”, Segun McMedal, the Chairman of NIPR, Lagos told BusinessDay recently. He said the award ‘LaPRIGA’ with the 2019 theme PROVATION is expanded to include more individuals and organisations in various sectors that have distinguished themselves in marketing communication roles. The award slated for December 19, 2019 aims at adding new colours and values to the industry by recognising

best accomplishments in reputation management and support for market functions. McMedal further said that the industry intends to use the award to sensitise the business leaders on the contribution of the industry to companies’ growth. This year, the organsisers will use the opportunity of the award to create more awareness on autism as there are more children being diagnosed with the disorder. “As communicators it is important we support in creating awareness about the disorder. We have auti-connect as our CSR project and at our programmes we have dramas to pass on the message”

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The award started about 10 years ago under the name Eagle award but it was repackaged as Lapriga in the last four years to give it more colour and content. The chapter is also planning to use the occasion to install the Lagos State Governor, Babajide Sanwo Olu as the patron of Lagos State chapter. Speaking at the unveil of Lapriga award, the President of African Public Relations Association, APRA, Yomi Badejo Okusaga challenged practitioners in the communication industry to come up with solutions for socio-economic challenges in Africa. According to him, the solution must be home-grown to peculiar issues in Africa. He said Public Relations is like injection which is not portent when it is in a bottle, but it is portent when it is administered. “We must therefore administer Public Relations to economic challenges”. Col Umoh who is deputy director administration at the armed forces resettlement center linked high insecurity in Nigeria to poor communication.

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tions since the 90s, a model which seeks to harness employee selfinterest to promote the organisations benefit of innovation and business growth. According to him, workplace has become a place for win-win. “It is a place for self-discovery for the employee and at the same time it is a place for innovative growth for the employer”. It is against the old model where the employee is just the workforce and manpower. With the expectation that Human Resources Department is central to the workforce engagement and understanding of the millennials, Nduneche said that the millennial conversation is not strictly a HR function. “It borders on organisational strategy because if people create wealth then the organisation must focus on the people and try to understand who they are beyond gender and age but their strengths, weaknesses, passion and affiliation”. It is significant to deploy more comprehensive employment analytics module that will seek to interpret who the employee is and harness his/ her skill to promote the general objective of the company, he said. “While HR can be foundational to the employee and employer engagement, trying to drive the process goes beyond human resources department”. Seye Awojobi, the Registrar and Chief Executive Officer of the Chartered Institute of Bankers of Nigeria (CIBN) commended Nduneche for the Employee Marketplace initiative especially for bringing up the millennial in the workplace issue. He

stated that the older generations must brace up to the challenge of tolerance and harmonious work environment in the digital era. Both generations must learn to embrace each other to be more productive, he stated. In his comment, Ikem Okuhu, a media practitioner commended the conversation Nduneche raised which focuses on maximising the potentials of the millennials but said evolving what will work will require interrogation of certain issues. Okuhu said understanding the millennials and giving them the eco-system to operate for optimal performance is important because essentially the future of the workplace is theirs. In his submission, Sobowale Timioluwa, of Intelligent Interactive Limited said the new workforce and the employees are the millennials and organisations have to take them for who they are. “They have very strong wills, talents and they have their weaknesses too but we have to make sure we get the best from them by giving them the environment they need to operate. “Every generation has what worked for them and this particular generation, giving them freedom to express themselves is what works for them”, he said. Also speaking, Nkechi Ali Balogun, public relations practitioner agreed that work environment may have changed but the goals and objectives have not changed. To achieve results, she said some organsations are integrating generation x with millennials for productivity.

Retail firm, FoodCo marks 37 years of doing business in Nigeria, rewards consumers Daniel Obi

s part of activities to mark its 37th anniversary , FoodCo Nigeria Limited, a diversified consumer goods company with interests in retail, quick service restaurants, entertainment and manufacturing, has said it would be starting a series of customer reward initiatives as part of activities to mark its 37th anniversary. The campaign, tagged My FoodCo Story, will chronicle the brand journey since inception in 1982 and encourage customers to share their most memorable experiences with the company, including available memorabilia. Speaking on the anniversary, Ade Sun-Basorun, Chief Executive Officer Designate, FoodCo, said in a statement: “We are happy to announce the start of activities commemorating our 37th anniversary in this November. This year’s event is a special one for us as it also marks our market entry into Lagos. It promises to be an exciting period because we will be throwing parties for our customers born in the month of November. We are also going to be giving them an opportunity to @Businessdayng

share some of the memorable experiences that they have shared with the brand over our 37-year sojourn.” “We are a 37-year-old institution and part of a small group of consumer goods companies that created the formal retail sector in Nigeria. Our journey began from a small stall in Bodija, Ibadan, Oyo State where we sold fresh vegetables and meat in hygienic conditions as an alternative for people who did not want to go through the hassles of shopping in the open markets. From inception, our business has been about providing customers their full range of needs at affordable prices. We have kept that promise irrespective of season and, in turn, have been rewarded with a large base of loyal customers whose support is at the core of the growth we enjoy today.” He continued: “Presently, FoodCo operates the largest supermarket chain in South-West Nigeria, outside Lagos, and it is ranked among the top 10 leading National Supermarket Chains in Nigeria. Earlier in the year, we were Awarded the Transgenerational Company of the Year (Excellence in Leadership category) at the BusinessDay Nigerian Business Leadership Awards, among several other recognitions.

Tuesday 19 November 2019

BUSINESS DAY

ADVERTISING Nigeria’s advertising industry wakes-up to reality, seeks government, business leaders’ attention, discusses post-digital age Daniel Obi

igeria’s advertising industry, critical in playing inter-mediation role in the growth, perception of companies and governments has suddenly woken up, collectively to compel the attention of government, business leaders and policy makers to the impact and value of advertising especially in emerging economy like Nigeria. To this end, advertising practitioners in the various specialised practices within the marketing communication industry will therefore converge on Abuja from various parts of Nigeria and the Diaspora for a conference early next week. The historic conference initiated by Advertising Practitioners Council of Nigeria, APCON which government has left without a chairman for about five years with its operational consequences, is coming when there is impression of indifference in the minds of some business lead-

LR: Tunji Olugbodi, president, International Advertising Association; Ijedi Iyoha, CEO, APCON; Emmanuel Ajufo, chairman, Outdoor Advertising Association; Steve Babaeko, member, Advertising Association of Advertising Agencies of Nigeria at the annoucement of the conference in Lagos recently.

ers and government officials of the value of the industry. Often times in Nigeria, companies are quick to cut budgets for marketing communication on the mis-understanding that it is a cost to the organisation while government rarely employs the

services of marketing communication industries to promote its activities in the public space. “The national conference has identified the need to raise the professional standing of advertising practice in Nigeria and compelling the attention

SPAR Nigeria announces 8-days of ‘Black Friday’ sales Daniel Obi

s consumers across Nigeria continue to shop early for the yuletide, SPAR Nigeria has announced that the 2019 black Friday sales will be on for eight days, giving consumers especially corporate Nigerians the opportunity to key into the huge discount season. It will run from 23 November to Saturday November 30. The hypermarket store that recently won the ‘Retail Brand

of the Year’ at the BusinessDay Nigerian Business Leadership Awards 2019, has promised to give away over 5,000 quality items during the Black Friday Sales. John Goldsmith, the head of marketing at SPAR Nigeria, said there are over 5,000 items ready for massive discounts at all its outlets nationwide. According to him, in the last six years, SPAR customers have always waited for this season of the year to make their purchases for the upcoming festive season.

“This year, there are a wide range of quality products which include Food, Grocery, Meats, Wine & Spirits, Electronics, Home Appliances, Laptops, Mobile Phones, Watches, Clothes, Perfume and many other products essential for individual and family use”. Goldsmith opined that SPAR provides the biggest save as they are always price competitive. Nigerians have been enabled to quality life through various community and social programs of the brand.

Foundation launches ‘The Start-ups Africa’, promises $10,000 to best business idea

n order produce new set of entrepreneurs in Africa, Felix King Foundation has unveiled a new initiative tagged ‘The Startups Africa’ that will groom and reward young and vibrant African youth with $10,000 startup grant. ‘The Startups Africa’ was launched in partnership with Trinity International University of Ambassadors, a Georgia based institution to key into the already existing programmes of the Felix King Foundation aimed at

alleviating poverty, empowering trade and providing employment. Felix King, the founder Felix King Foundation said, he believes strongly in the ability of young Africans to birth the innovative business ideas that can change the world for the better. “We are willing to provide the help and support needed to actualize this. I have always believed that if you are a billionaire and all you think about is your immediate family; then you are a poor person in your soul. www.businessday.ng

“We are not in this project because we have a surplus. On the contrary, we are driven by our conviction and belief in the saying: we can only rise by lifting others. Africa can only be great when we lend the hand to lift one another,” said King. According to King, startups are hyper-innovators driven by ambition and insight to charge into the unknown. The entry for ‘The Startups Africa’ opened on November 15th, 2019 and closes on January 31st, 2020 with grand finale holding in March/April 2020.

of the government, business leaders to the value of advertising”, the CEO of APCON, Ijedi Iyoha who is successfully driving the agency without a board, told BusinessDay. The conference, she said will provide opportunity for advertising practitioners to

take stock, review the prospects and challenges of the profession and chart a course for the further development of the advertising profession in Nigeria. With a central theme: ‘Advertising in the post-digital age: the profession, the business and Nigeria socio-economic development’, the conference, Iyoha said will provide a networking, peer review and collaboration opportunities for the members of the profession across specialisations and geographic locations. “Guided by the theme, the conference will take a longterm view of the practice as well as the business of advertising in Nigeria in the light of the digital revolution that has transformed every aspect of life as well as the current challenge of transforming Nigeria’s economy and society” To give direction to the discussion, Lolu Akinwunmi, Chairman of Prima Garnet Africa and former chairman of both APCON and AAAN will deliver the keynote address while the Vice President, Yomi Osinbajo is expected to declare the conference opened.

Journalists’ forum set to discuss ‘Survival amidst harsh economy: Inside stories of top brands’

he stage is set as the Brand Journalists Association of Nigeria, BJAN, the umbrella body for journalists reporting the Integrated Marketing Communications sector in Nigeria, holds its 7th Annual Brands and Marketing Conference in Lagos. With the theme; Survival Amidst Harsh Economy: Inside Stories of Top Brands, the conference is structured to collate, analyse and aggregate thoughts, ideas, knowledge and propositions that will help in positioning businesses amidst economic challenges as seasoned industry practitioners and other stakeholders

gather to share their experiences. Lead speaker for the event hold in November 29 in Lagos is Steve Babaeko, Chief Executive Officer, X3M Ideas, while other eminent speakers expected at the forum include Soromidayo George, Director, Corporate Affairs & Sustainable Business, Unilever Nigeria, Tokunbor George-Taylor, Managing Director, Hill & Knowlton Strategies, Atimomo Idiare, Co-Founder/COO, Up in the Sky, Odion Aleobua, Chief Executive Officer, Modion Communications and Tunde Kara, Managing Director, Red Media Africa.

Chi Limited introduces Hollandia Lactose Free Easy-to-Digest Milk

hi Limited has introduced a new product to the Hollandia Family – Hollandia Lactose Free Easy-to-Digest Milk. The company said research has shown that majority of Nigerians are lactose intolerant and are unable to digest LACTOSE present in milk. “This gives rise to symptoms varying from bloating to flatulence, nausea, cramps, diarrhea, and stooling. Most consumers may not connect these symptoms with lactose intolerance since the awareness is low. For those who are aware, they may stop taking milk, thereby losing out on all the benefits of milk,

such as calcium, proteins and vitamins”. As part of Chi Limited’s commitment to meet the dairy nutritional needs of consumers, Hollandia Lactose Free Easy-to-Digest Milk was launched, it said.

Heineken unveils new bottle label

o r l d ’s b e e r b r a n d , Heineken has unveiled an allnew bottle label. The premium beer brand has had an exciting year, with the introduction of a newly designed 33cl can, a new SKU (the 33cl sleek can), as well as the launch of a new crown cork. The new label which carries the “Heineken Original” wordmark is a reference to the authenticity of Heineken. This new label also changes the text from “Premium Quality” to “Premium Lager Beer”, as well as a change from “original recipe” to “unique recipe”. The new label, according to a statment represents the next subtle step in the evolution of the Heineken identity.

Black Friday: Jumia expects over 12,000 SMEs to sell millions of products during campaign Daniel Obi

umia, Pan-African e-commerce platform with presence in 14 countries in Africa has disclosed that its 2019 Black Friday campaign will attract a surge of new shoppers during the campaign period scheduled for November 8th through 29th. The company’s Head of

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Growth, Ayobami Martins who stated this in a press statement, said over 12,000 SMEs in the country will list over 10 million

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products on the platform during the campaign. “There are several facets to our Black Friday campaigns. First, it’s a sales event where consumers take advantage of the biggest cost saving offers through our various deals, huge discounts and flash sales. Second, it’s an opportunity to expand the revenue of our sellers, the entrepreneurs selling on our marketplace.

Tuesday 19 November 2019

BUSINESS DAY

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Tuesday 19 November 2019

BUSINESS DAY

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Tuesday 19 November 2019

BUSINESS DAY

COMPANIES & MARKETS

Company news analysis insight

MARKETS

These 3 stocks can earn you more money in dividends than 1yr T-bills LOLADE AKINMURELE

he return on one year government Treasury bills have now fallen below the dividend yield of some of Nigeria’s biggest banks presenting an entry opportunity for bargain hunters. Trading at around 7times earnings compared to the frontier market average of 14 percent, Nigerian stocks have been cheap this year but are now seen getting a big boost following a restriction on the purchase of high-yielding central bank securities by nonbank institutions. The restriction has rendered trillions of naira homeless. The ban has sent treasury yields to a three-year low but bank stocks to a three-year high. With dividend yields higher than the return on one year treasury bills, bank stocks make a compelling case to be the destination for those homeless funds. Extrapolating from dividend paid in 2018, Zenith bank boasts the highest dividend yield among big banks at around 17 percent, some 700 basis points above the 10 percent stop rate for one-year

The yields on one T-Bills offer investors a negative real return of 1 percent, considering that inflation printed 11.23 percent at the last check in September. Expectations that yields in the fixed income market are heading to single-digits and with inflation tipped to rise in the coming months, stocks with double digit dividend yields are likely to see increased demand. Zenith is not the only big bank with dividend yields above the one-year government debt. United Bank for Africa has a dividend yield of 15.9 percent. Again, investors are noticing. A record 67 million shares worth N501 billion were traded Thursday alone, the most in the last seven trading days at least. UBA’s share price has jumped to N7.40, the highest since April 2019. Guaranty Trust Bank also slightly edges one-year treasury bills with a dividend yield of 11 percent. Investors traded a record 37 million units of GTB stocks worth N1.1 billion on Wednesday alone. L-R: Connor Sattely, business development manager, The Hague Institute for Innovation of Law (HiiL); Chibuzo Ofulue, CEO, Africlaim/1st The increased demand has runner-up, Innovating Justice Challenge 2019; Funkola Odeleye, co-founder/CEO, DIYLaw, and Kanan Dhru, community manager, HiiL, at the Innovating Justice Challenge Regiona Finals Lagos 2019, organized by HiiL and The Netherlands Ministry of Foreign Affairs, in Lagos. pushed the lender’s share price to Pic by David Apara N29, the highest since September.

treasury bills at last Wednesday’s primary auction and 600 basis points above inflation. Zenith’s superior returns have certainly caught the eye of investors who bought a record N5.9 billion worth of the tier-one lender’s shares last Wednesday alone, the most in the last seven trading days at least. Between Tuesday and Thursday, a total of 591 million Zenith bank shares valued at N10.6 billion

were traded. The lender’s share price gained 8 percent in that period closing at N19.15 on Thursday, according to NSE (Nigerian Stock Exchange) data. That’s the highest price it has traded at since July 2019. There would be more to come in terms of demand for Zenith bank as local non-bank institutional investors now banned from purchasing high-yielding CBN

securities, otherwise known as Open Market Operations (OMO), pile into the bank’s stocks. “Zenith has been on a tear since yields on treasury bills started collapsing and is showing no signs of slowing,” one trader told BusinessDay. “It presents a compelling case for dividend yield play at a time when yields in the fixed income market is fast falling below inflation rate,” the trader said.

FUNDS

FG borrows N6.84tn from N9.58tn pension funds in September …fund managers increase exposure to NTBills OLUWASEGUN OLAKOYENIKAN

ension fund administrators (PFAs) increased their exposure to Nigerian Treasury Bills (NTBills) in September to take advantage of relatively attractive yields in the segment of the fixed income market, following increased liquidity during the month buoyed by maturing OMO Bills. While the total assets under management (AUM) of the regulated pension industry increased marginally by 1.5 percent on a month-onmonth basis to N9.58 trillion in September, N2.26 trillion which represents 23.62 percent of the funds was invested in the short-term government debt instrument. This compares with N2.2 trillion which accounts for 23.31 percent of pension assets starched in NTBills in the previous month, according to recent data obtained from the

National Pension Commission (PenCom). The pension assets as of September 2019 “represent just 7.5 percent of 2018 GDP,” analysts at FBNQuest, the research arm of First Bank of Nigeria Holdings Plc, said in a note to clients. “This coverage lags peer emerging markets because the Nigerian industry, dating from 2004, is one of the newest.” Yields steeped lower in the bills market in September on the back of buy pressure from institutional investors - including pension fund managers – particularly in the March 2020 maturities, forcing average yield on the security to fall from 13.84 percent in August to settle at 13.28 percent in the review month. This preceded CBN’s recent policy which bans local non-banks such as the PFAs, insurance companies and individuals from participating in the OMO market. The effect

of the policy “should become visible in coming monthly reports from Pencom,” FBNQuest said. But in spite of the increase in the total pension funds for the review month, a lower portion was allocated to the Federal Government of Nigeria and State securities, even as exposure to Corporate Debt Securities rose. A total of N6.84 trillion, representing 71.43 percent of the funds was invested by the pension fund managers in FGN Bonds, Treasury Bills, Agency Bonds, Sukuk Bonds and Green Bonds. This is against 72.24 percent of pension assets devoted to FGN securities. Total invested fund in State and Corporate Debt Securities as a percentage of total pension fund assets stood at 1.31 percent (or N0.125 trillion) and 6.49 percent (or N0.62 trillion) in September 2019 from 1.36 percent (or N128 billion) and 5.89 percent (or

N556 billion) in August 2019, respectively. Pension fund assets investment in Nigeria’s stock market increased to N492 billion in September 2019 from N465 billion August 2019, thereby increasing the proportion of total pension funds in local equities market to 5.13 percent from 4.93 percent. Investment in foreign equities gulped N65 billion from N63.9 billion recorded in the

previous month. Also, the PFAs maintained their investment share in Supra-National Bonds as well as Local and Foreign Money Market Securities at 0.04 percent, 11.21 percent and 0.09 percent, respectively. The pension operators invested N4.03 billion in Supra-National Bonds; N1.07 trillion in Local Money Market Securities; and N8.42 billion Foreign Money Market Securities.

The data further show that N21.81 billion of the funds was invested in mutual funds comprising open/close-end funds and REITs. A total of N231.48 billion was invested in real estate properties, while N32 billion was invested in a private equity fund. The pension money managers invested N34 billion in infrastructure fund, while N26 billion was invested in Cash and Other Assets.

L-R: Kola Adesina, executive director, Sahara Group; Pearl Uzokwe, director, governance and sustainability; Babatomiwa Adesida, Sahara Foundation private sector engagement specialist, and ivie Imasogie-Adigun, group head, human resources, at the media presentation of the Sahara Group 2018 Sustainability Report in Lagos

Tuesday 19 November 2019

COMPANIES&MARKETS

BUSINESS DAY

Business Event

OIL

OPEC faces grimier 2020 outlook amid surging rival output SEGUN ADAMS

he Organization of the Petroleum Exporting Countries (OPEC) and its partners should expect lower demand for their oil next year as increasing output from rivals eats up their market share, the International Energy Agency (IEA) has said. “The OPEC+ countries face a major challenge in 2020 as demand for their crude is expected to fall sharply,” a Reuters report citing IEA stated. IEA estimates the demand for crude oil from OPEC in 2020 at 28.9 million bpd, which is 1 million bpd below the bloc’s current production. Meanwhile, non-OPEC supply is expected to grow to 2.3 million barrels per day (bpd) next year up from 1.8 million bpd in 2019 on the back of increased production from United States, Brazil, Norway

and Guyana. “The US will lead the way but there will also be significant growth from Brazil, Norway and barrels from a new producer, Guyana,” the energy watcher said. Brent gained 0.77 percent and WTI rose 0.78 percent on Friday. The pessimist outlook for 2020 comes ahead of a December meeting of OPEC+, who would have to decide on a solution. However, IEA believes the hefty supply cushion that is likely to build up during the first half of next year will offer cold comfort to the OPEC+ ministers gathering in Vienna next month. A decline in sales of crude would be telling on Nigeria which proposes a budget of N10.33trn in 2020 hinged on a $57 per barrel oil benchmark price and an output of 2.18 million bpd. Nigeria’s reliance on oil for government revenue and

rising debt cost have been a major cause of worry for the country which is growing less than its natural rate by at least 3 percent. The IEA also said global demand for oil grew by 1.1mbpd in the third quarter, up from 435,000 barrels a day in the second quarter. The surge was majorly due to the 640,000 barrels increase from China compared to the year before. The outlook is that global growth will be 1.9 million barrels per day year-on-year for the final quarter of 2019. On the supply side, production grew by 1.5 million barrels per day in October following a recovery of Saudi Arabia’s output after a drone attack on its biggest oil facility. IEA also noted contributions from Norway, Canada and the US. However, OPEC crude production fell 2.5 million year-onyear to 29.9 million barrels a day.

L-R: Thomas Dada, immediate past president of the Nigerian Gas Association (NGA)/CEO, Frontier Oil; Simbi Wabote, executive secretary, Nigerian Content Development and Monitoring Board (NCDMB); Audrey Joe-Ezigbo, current president, NGA/co-founder Falcon Corporation; Chichi Emenike, head, Gas business, Neconde Energy/financial secretary, NGA, and Bolaji Osunsanya, CEO, Axxela Limited/past NGA president, at the 20th Anniversary Ceremony of the NGA, at the Eko Convention Centre, Lagos.

DEALS

PalmPay raises $40m from TECNO mobile to deepen financial inclusion across Africa ENDURANCE OKAFOR

almPay, an Africa-focused mobile payment start-up, has announced a $40million funding round led by leading mobile phone brand TECNO mobile to advance financial inclusion across the continent. The Fintech firm has officially launched a smartphone app with a mobile wallet in Nigeria after a pilot phase that saw it gain 100,000 users and process more than a million transactions within two months. “PalmPay will use the capital to grow its digital financial services business in Nigeria and Ghana and to support upcoming launches in several other African countries,” Greg Reeve, Global PalmPay CEO said. NetEase, one of the largest internet technology companies in China; and Mediatek, a leading semiconductor com-

pany, also participated in the round. The PalmPay mobile wallet offers customers a platform to top up funds electronically or via offline access points, with the ability to make and accept individual and merchant payments. PalmPay offers consumers a range of digital services, including P2P transfers, airtime and bill payment. With a tagline of “the payment app that rewards you”, PalmPay’s USP of offering cashback and discounts to its users has caught on in the price-sensitive Nigerian and Ghanaian markets. In Nigeria, PalmPay is offering 10% cashback on airtime purchases and bank transfer rates of N10 with free deposits and withdrawals to its mobile wallet. As part of its investment deal with TECNO mobile, PalmPay also announced a strategic partnership which will see the payments app

pre-installed on up to 20m phones in 2020. A similar deal has been inked with Infinix and Itel. The app is also available on the Google Play Store and iOS app stores. “Tecno has helped expand access to smartphones among the Nigerian population. We are now looking to leverage this infrastructure to further improve people’s lives,” said Stephen Ha, General Manager of TECNO Mobile. “We see a huge growth opportunity in mobile payments and financial services on the continent and are looking forward to working together with the PalmPay team to help shape the future of payments in Africa.” In a market where only 40 percent of adults have access to a formal financial account, PalmPay wants to provide financial services for both banked and unbanked consumers to achieve nationwide reach.

FINANCIAL SERVICES

Emerging Africa Capital to facilitate access to finance for SMEs, others Seyi John Salau

merging Africa Capital Group (EACG), a leading financial services group which aims to advance Africa’s development through investment solutions, has set up a unit to assist African small and medium enterprises (SMEs) to access appropriately structured funding for their businesses. This was one of the highlights at the third quarterly board meeting in Lagos, where the management updated the board on the progress made in its efforts to deepen access to finance by extending its advisory and capital raising services to African SMEs looking to scale up their businesses.

According to EACG, to do this effectively, it will partner national, regional and international development finance institutions, specialized development funding agencies and commercial and specialised banks as well as private equity firms and international funds. In a statement, the company said, its board led by Chief Mrs Onikepo Akande, a former Minister of Industry and former President of the Lagos Chamber of Commerce & Industry, noted these developments with approval and also commended the company and its leadership. “EACG was recently appointed as a Business Development Service Provider to the Bank of Industry(BoI) whilst its Group CEO, Olu-

watoyin Sanni joined the Investment Committee of the FEI Off-Grid Energy Access Fund (OGEF Fund). “The fund aids access to reliable sources of energy by providing local currency financing solutions to African companies bringing affordable solar energy to communities living off the grid in the region and was structured by Lion’s Head Global Partners in partnership with the African Development Bank, Nordic Development Fund and All On, amongst others,” the company said. The EACG facilitates the capital raising process for African states and businesses and the investment process for individual and institutional investors interested in attractive investment opportunities.

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L-R: Hamid Sidine, GM, ZamZam Pullman Hotel Makkah; Abdul Jelili Animashaun, chairman, Al-hujjaj International Umrah and Hajj Services; Ayman Elykayssouni, cluster director of sales and marketing, ZamZam Pullman Hotel Makkah & Madina, and Mohammed Gouda, revenue manager, ZamZam Pullman Hotel, Makkah, at the hotel’s stakeholder meeting with hajj operators in Lagos

L-R: Tagbo Helen, on-trade manager, Ekulo Group of Companies; Adesuwa Henry, supervisor, Brian Munro; Mark Loxley, GM, Southern Sun Ikoyi; Steve Eyanimo, administration manager, DISTELL wine & Spirit Nigeria Limited, and Cliff Shiridzinodya, deputy GM, Southern Sun Ikoyi, at the media briefing for the upcoming Southern Sun Ikoyi 8th Annual Good Day in Lagos

L-R: Chioma Odum, CTO, BCX Nigeria; Antoine ElHakim, data center channel and alliance manager, Schneider Electric; Ayo Adegboye, MD, BCX Nigeria, and Rita Amuchienwa, country sales leader, Secure Power Division, at a Strategic meeting held by the partners at BCX head office in Lagos.

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Tuesday 19 November 2019

BUSINESS DAY

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Tuesday 19 November 2019

BUSINESS DAY

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Tuesday 19 November 2019

BUSINESS DAY

An executive MBA strikes the right note Singer Lauren Henderson’s course has helped her navigate the music industry and develop other artists business acumen Amy Bell

efore she quit her j o b at Un i ve r s a l Music Group to become a full-time jazz singer, Lauren Henderson, 33, used to moonlight as a performer at bars and restaurants in New York. Dashing across town after a day making television adverts, she just about had time to change and sound-check before heading on stage. “I really wasn’t sleeping much. Sometimes they would ask me to do an extra set, and I would go into the night, knowing I had to get up at 6am the next day for a meeting,” says Henderson, who spent her breaks at work going through songs and jotting down musical arrangements. By 2014 the juggling act had become too much. Having built up enough contacts and work, Henderson decided to pursue music full time. Five years later, she is a performer with five albums and tours of Europe, South Africa, Mexico and Russia under her belt. Alongside this she runs her own record label and has an executive MBA from IE Brown. The path towards executive education started when Henderson wanted to make her first album. She researched the industry and spoke to different labels but became unstuck as many wanted to own the rights to all her music as part of the contract. Her experience in television production gave her an advantage over many of her musician peers when deciding which label to choose. Many artists head into the industry straight from music school and have little understanding of management and production. But Henderson felt that loss of rights also meant she risked losing autonomy over the direction of her career and music, which she says is influenced by her mixed African-American and Caribbean heritage. “I wanted to be taken seriously and to effectively ask for what I wanted and needed as an artist,” says Henderson. “I wanted to feel equipped to handle various aspects of my music business. I didn’t want to rely on other people.” But for this, she needed more insight into how business worked. She was already familiar

with IE Brown — which is in Providence, Rhode Island — having grown up in neighbouring Massachusetts. Using savings and a loan, she enrolled on its EMBA in 2017. “I thought this would be a great experience for me to learn from others and advance,” she says. The 15-month course kicked off with two weeks at IE in Madrid, followed by stints in Providence and South Africa. The course was a combination of in-person and online sessions, allowing Henderson to continue touring. As the only professional musician on the programme, Henderson appreciated the diverse cohort. “We had a surgeon, people from [consultancy] Deloitte, from Wall Street, a sommelier, an art critic,” she says. “I learnt so much from them. We were all balancing our careers and some people were making transitions.” D u r i n g t h e p ro g ra m m e some students welcomed babies into the world, while others had relationship problems or family bereavements. Maintaining a balance between studying, work and personal commitments was tough. “I didn’t expect to sleep much and I didn’t,” she recalls. “Bewww.businessday.ng

cause we worked together so much and travelled the world together as a cohort, we really helped each other through.” Henderson was busy making her own transitions too. While managing her work as a performer and her studies, she set up her own record label, Brontosaurus Records. “It quickly became apparent I could navigate this on my own and be in control of how I’m represented as an artist and how much money I’m making,” she says. “The label is new and the opportunity to study business seemed to arise at the perfect time.” The artist and new business owner found the marketing course particularly valuable. “Really going deep into why things appeal to different audiences or having goals and deadlines — looking at things in an organised manner — was very helpful to me,” she says. There were some surprises too. “Economics was something I was so nervous about because I had never taken it before — it was one of my favourite courses,” she says. She found the topic intriguing and feels empowered by her new understanding. “In the past, even when I was doing taxes, I

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would basically have no idea. Now I feel informed,” she says. The musician has noticed a big change in her approach to her business since taking the EMBA. She is still paying off the loan but feels strongly that it has been worth the investment. “I’m already doing things more efficiently. I have a better understanding of what I’m putting out there,” she says, from analysing the market and adapting marketing strategies for different regions, to how she communicates with venues. Henderson admits she was a “people-pleaser” before but says the EMBA has helped her be more comfortable balancing business needs and personal relationships. “Before, I wanted everyone in the band to make X amount of money and to stay in a really comfortable hotel, but if I can’t provide that I need to come up with another solution, to make sure I’m making money and not losing it,” she explains. She is also more confident working with her accountant, expressing what her financial goals and expectations are for the fiscal year. Many freelance musicians in the US cannot take advantage of the benefits of health insurance paid for by an employer, @Businessdayng

she says. “We have to figure out how to pay medical bills and insurance, while balancing a career that doesn’t always guarantee you the next pay cheque.” Through Brontosaurus Records she wants to give other artists the confidence to develop their business acumen. “I see this all the time: artists are taken advantage of as they can’t express what they need and what their limitations are,” she says. “When you sign a contract you need to be sure you are reading the fine print and what is happening with the [master recordings] of your work. Over the years I have learnt the different sticky situations you can get in if you are not aware of what is going on.” Brontosaurus is a small, boutique label that lets its artists manage the rights to their work. Henderson works with several artists on a freelance basis, but as of October she only represented four in addition to herself — they have to be the right fit for the label, and she also wants to make sure she has the capacity to fully support each one. A l o n g s i d e h e l p i n g a r tists with creative matters, Henderson works with them to develop personal career plans and goals. “I do whatever I can to prepare my artists to be entrepreneurs, as well as to own and develop their intellectual content,” she says. This includes selecting artists who can “collaborate with one another to learn, grow and develop musically and from a business perspective”. For now, Henderson manages Brontosaurus Records on her own and is happy with it being a small label, though she plans to expand gradually. “Having worked with Universal, the people that bring in the most revenue are the priority, but that can create problems for emerging artists,” she says. “Quality over quantity is the way to go, especially in jazz or Latin jazz, which is such a nice art form.” She intends to run the label while performing as much as she can herself, which means balancing her time and focusing on realistic goals. “While I’m still young I think about my retirement, and what I want to do later — I hope to be wheeled out on stage still singing,” she says.

Tuesday 19 November 2019

BUSINESS DAY

Companies beware the cult of community The trend for promoting ‘belonging’ risks doing a disservice to the truly public-spirited

ome of the most remarkable scenes in Chernobyl, the HBO/ Sky drama about the 1986 nuclear disaster, involved sacrifice. Firefighters, soldiers, nurses, doctors, scientists and ordinary citizens exposed themselves to sometimes fatal doses of radiation as they fought to limit the impact of the meltdown on their wider community. Not all knew about the dangers, and many of those who did were pressed into assisting at gunpoint. “This [disaster] could have only happened in the Soviet Union,” screenwriter Craig Mazin suggests in the series podcast, because of the communist empire’s dysfunctional culture. At the same time, he says, “only the Soviet Union could have solved this problem” because “it was understood that you were part of a collective and you were there to support your fellow man and your fellow woman”. The sense of “belonging” and shared effort that underpins any successful community is a powerful force: it is no wonder companies have been quick to adopt the term. An inclusive company encourages a sense of belonging among all staff — and increasingly among

customers too. In 2017, Facebook founder Mark Zuckerberg, assailed by criticism of how the social media group had facilitated fake news and election-rigging, recast its purpose. Its new mission is to “give people the power to build community and bring the world closer together”. As the Chernobyl experience suggests, the community fad has a dark side. The mildest symptom is what I heard one Silicon Valley executive describe as “community-washing”, where businesses set up communities to help improve, or whitewash, their reputation. “You see it everywhere,” she said. “User communities, customer communities, with guidelines and rules. I see it being woven into society, but not in any useful way.” The trend may even be counter-productive. In Entrusted, their book on reforming capitalism, Ong Boon Hwee and Mark Goyder warn that social media’s “new forms of connectedness” could replace real, diverse communities, rooted in neighbourhoods or villages, with self-selecting, homogeneous, virtual ones. Tight-knit communities can also be the opposite of inclusive. Staff who do not conform to some ill-defined “cultural fit” www.businessday.ng

are made to feel unwelcome, or never hired in the first place. “Perhaps you don’t belong here” may be one of the cruellest hints to a team member to look for a job elsewhere. Unlike, say, villages, corporate communities are impermanent. Their members are subject to official sanction or

”

Andrew Hill

User communities, customer communities, with guidelines and rules. I see it being woven into society, but not in any useful way

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dismissal, which strains the ties of trust that bind them. I understand why the chief executive of asset manager Invesco recently said cutting 12 per cent of its staff was “uncomfortable for everybody”, but I imagine the discomfort was borne disproportionately by those carrying their desk contents in a box to the exit. “Belonging” at work can become slightly creepy, even cultish. I draw the line at describing office friends as “family” — a term that has crept into corporate communications. Real families are different : much as we may sometimes want to, it is impossible to fire blood relations. There are parallels, however. Families, like some close-knit business teams, often put belonging above candour. Ginka Toegel and Jean-Louis Barsoux of IMD business school found many teams were hampered by what they call “undiscussables” — topics consciously or unconsciously put off-limits, to the detriment of performance. They found teams often fail to practise the values they preach because by exposing the gap between saying and doing “we may hurt some of our group’s feelings and we won’t be as cohesive”. The academics cite the failure of Theranos, a US blood@Businessdayng

testing company, where a “culture of fear and denial . . . ultimately led to false claims made to investors and customers”. They might as easily have picked the Chernobyl disaster, where the cultish devotion of staff, scientists and apparatchiks to the crumbling communist ideal made them reluctant to speak up. This created the conditions for the accident and the attempted cover-up. Mazin contends the mission to save the Soviet Union — and much of Europe — from an even worse outcome would not have been possible in the west. If the Three Mile Island reactor in the US, which had a partial meltdown in 1979, had exploded, “we would have evacuated the area very quickly and then just . . . put a rope around a large section of the middle Atlantic [coast] and said no one can go there any more, because we can’t send people in ’cos they’ll die”. I am not so sure. We know from citations for valour how much soldiers will risk for their comrades. On September 11 2001, I watched in admiration and horror as firefighters went into the doomed twin towers of the World Trade Center. Community and belonging are powerful forces. It is up to companies to make sure they do not abuse them.

Tuesday 19 November 2019

BUSINESS DAY

property&lifestyle How govts could address housing finance shortage to drive affordability Stories by CHUKA UROKO

Obileye is a UK-trained lawyer and CEO, Great Heights Property and Facilities Management Limited Email: Tundeobileye@greatheightslimited.com

lobally, housing affordability is a big issue differing only in degrees from region to region and from country to country. In Africa, it is worse because of the high level of poverty on the continent. In Nigeria, which has been adjudged the world poverty capital, and where housing or homeownership has become a luxury rather than necessity, the situation is dire, requiring urgent attention. But the African Union for Housing Finance (AUHF) says African governments can address housing finance shortages though this requires taking some strategic steps by all stakeholders in the housing value chain. In doing so, they noted the challenges, identified the opportunity and explicitly highlighted actions for attention by government, the (direct foreign investment (DFI) sector, the private sector, and themselves. They admitted that the most critical issue facing housing markets worldwide, whether in established or emerging markets, was housing affordability which challenges are especially acute in African countries. Housing affordability, they noted further, was exacerbated by unfavourable macro-economic conditions, challenging labour market dynamics, municipal capacity constraints, as well as the pressures of urbanisation and climate change. Gov-

Infrastructure Maintenance With Tunde Obileye

Master plan: A valuable tool in FM

ernment capacity to address the challenge, on its own, is limited. They explained that government capacity was limited by higher government debt and lower revenue, as a result of economic downturns being experienced in most African countries which have limited the budgetary room of policy makers. “At the same time, governments have an enabling and catalytic role to play in supporting the development of an enabling macroeconomic framework and the growth and appropriate targeting of housing finance markets, while also developing policies conducive to affordable housing development,” says the declaration which also urges African governments to pursue five key recommendations. Among other things, the declaration enjoins governments to set and pursue explicit targets for reducing the time and cost of key statutory and administrative processes on which

housing delivery depends, such as development and zoning approvals, occupation inspections, land titling, infrastructure connections, and services clearances. Governments should strengthen property and collateral registration, maintenance and foreclosure mechanisms ; improve transaction time-frames, and to ensure the transparency of the collateral registry through free access to record-level data, and automation of deeds registries. The declaration also wants the governments to pursue macro-economic policy and financial regulation and taxation conducive to long term, local housing investment, focusing explicitly on interest rates and inflation targets, as well as other measures that lower maturity premiums and credit risk premiums. It hopes that these measures, as well as explicit attention to local long-term capital (pension funds, institutional investors) will further stimulate investment

and the availability of affordable housing finance. The declaration urges the governments to support the affordable housing delivery process through enabling or otherwise incentivising the supply of well-located land and bulk infrastructure. They should also support the Data Agenda for Africa, agreeing on mortgage lending and other housingrelated reporting standards to enable cross-country comparability, supporting the development of an effective and comprehensive credit reference system. That system should be such that efficiently covers all financially active consumers and stimulates market transparency, explicitly supporting principles of data transparency and regular reporting. The declaration gives explicit emphasis to the need for an affordable green standard that addresses local climate-related and urbanisation pressures in relation to affordable housing.

aking a trip without any planning in advance can lead to wasted time, money and effort leading eventually to frustration and stress. A plan often results in proper coordination of the necessary activities relating to the set objective and minimizes uncertainties. The same can be said for master plans for facilities. Without them, facility managers are likely to go from one crisis to another, reacting instead of having a proactive approach. For instance, knowing what equipment is due to be replaced or what resource is required for a particular need. With a master plan, facility managers get a valuable tool to help meet organizational needs, secure funding, prepare for a range of activities and scenarios, and avoid surprises. A point to note, however, is that as each organization is unique in culture so too is each master planning approach. They take a distinctive shape based on needs, priorities, and challenges of the specific organization. A master plan can be one for growth in an ever-changing world; one that takes cognizance of new industry standards and government regulations amongst other things. A master plan does not necessarily have to be just one plan; it can be a combination of plans. There can be a three-

Investors fault claims on The Plush Estate, here’s their explanation

orried investors in the up-coming estate nestled between Magodo GRA Phases 1 and 2 known as The Plush have faulted claims by the Lagos State New Town Development Authority (NTDA) and the Magodo CDA that the estate is wrongly sited. The NTDA had, through a media publication, said the development of the estate was illegal and without the approval of the state government, pointing out that the developers were planning to convert a green belt in the Magodo GRA Phase 1 to the housing estate to be known as The Plush. Aderenle Oni, NTDA’s general manager, noted that a consortium of land-grabbers, a company and traditional authorities had blocked and re-directed the canal in the

green belt, which is located in a vast gorge that separates Magodo GRA phases 1 and 2. He said that the promoters of the housing estate had marketed the green belt as dry land to unsuspecting members of the public and had also advertised the estate as part of the Gateway Zone CDA, Magodo GRA Phase 1, and that access to the site would be through the GRA’s main gate. But the investors, who were alarmed by these claims, stated pointedly that they were not “land grabbers”, insisting that they were legitimate investors in a property they knew was not a green belt, a gorge or swamp as is being claimed by both the NTDA and the Magodo CDA. The investors also faulted claims by Oyebode Ojomu, the Magodo CDA chairman,

who noted that the plan by The Plush promoters portended danger and environmental hazards for members of the public, and that the estate was never part of the Gateway Zone CDA. “We are representatives of over 18 other subscribers

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to this upcoming project. We are residents of neighbouring estates; we decided to invest in this project and before investing and making commitments, we did our due diligence,” said Oyewole Olurin, a subscriber to The Plush, at a press conference in Lagos.

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Olurin described as misleading the allegation that the land in question was a greenbelt, gorge or swamp and that its development had led to landslide, resulting in the loss of lives and property. “The Gateway Zone of CDA is a beneficiary of the government estate and so are we. What we bought was an approval in principle as other permits and documents are still being awaited before we start construction on the said land,” he said. He noted that from documentary evidence, The Plush was nowhere near the gorge as “the gorge stands on its own and is not obstructed by our proposed development; we implore the CDA chairman to desist from further harmful reports on our es@Businessdayng

year plan that focuses on technology; a five-year plan on preventive maintenance and a 10-year plan on replacement of large, expensive equipment such as generator and air handling units. For the facility manager, the master plan allows for adequate preparation in order to achieve organizational goals. For instance, if there’s a fiveyear plan for replacement of equipment, the facility manager is able to put together an asset list which includes the life expectancy of equipment, the year built and the year installed. This information feeds into the five-year plan, therefore giving him/her the opportunity to plan and budget for replacement. The pay-off for the plan includes fewer breakdowns and more efficient maintenance because the plan keeps everything, including equipment, up-to-date. A five-year plan isn’t a very long time to look ahead in most cases because by the time one project is finished, it is time to start another one. One key element of a master plan is flexibility. This is essential in order to adapt to changes in societies, cultures, and the market. As trends change or the economic market fluctuates, there may be a need to tweak the master plan or even the smaller plans within the master plan to incorporate the new findings. tate; we want peace, but let nobody push us to the wall.” Olaolu Oladipo, another major investor in The Plush, who was also at the press conference, recalled that before they decided to invest and make financial commitment on The Plush, they were shown the state government Gazette no 11 Vol 30 of May 1, 1997 dully signed by government agencies. “Besides being told the land resides with the rightful owners who it was allocated to, we were also shown the survey plans issued and approved by government agencies. The land is a ‘freehold’ and not a gorge or swamp as described. “We are, therefore, appealing to the NTDA to show restraint in their intervention on this issue; we urge appropriate investigations to be carried out before drawing conclusions or supporting libelous claims,” he said.

Tuesday 19 November 2019

BUSINESS DAY

property&lifestyle Assessing Airbnb operations in Nigerian market Continued from previous publication Airbnb in Nigeria irbnb continues to enjoy rapid growth in Africa, recording the fastest growth in Nigeria. Annual guest numbers more than doubled over the past year from 572,000 to 1.2 million, the Californian company announced in a new report, with active listings up from 62,000 to 100,000. The figures show a 5th straight year of strong growth from a base of just 6,000 listings and 22,700 guests in 2012-2013. South Africa remains the cornerstone of Airbnb’s business in Africa, accounting for 43,400 listings and income worth $86 million. A tourist hub, Cape Town is the most popular city with 17,600 active listings, generating $55 million for local hosts. Morocco is the 2nd largest market in Africa, with 21,000 active listings earning $22 million. Kenya ranks 3rd with 5,900 listings, earning $3.9 million. Nigeria is the 5th largest market but showed the fastest growth of 325 percent over the past year with effective locations in Ibadan, Abuja and places in Lagos

like Lekki County Apartments, Mixta Apartments, Urban Shelter Apartments, Lekki Gardens Apartments and many more as high yield accommodations. The easiest way to explain Airbnb in Nigeria is to call it the Uber of houses. The same way people use their cars to sign up on Uber, Lyft or Taxify services to earn income, is the same way people rent out their houses for the short term using Airbnb. Uber has pioneered the aggregation of transportation at scale. Airbnb has also done the same in the hospitality sector. (Aggregation is a construct where an app or web platform brings suppliers into an ecosystem for users and customers to find

and patronize them). Uber aggregates taxi services for travelers or just for a city trip. Similarly, Airbnb aggregates spare rooms for those that need rooms when they are out of town. Aggregation has made it possible for an individual to have a “home away from home”, particularly for those who desperately want to save on accommodation when they travel. Technology has made the aggregation possible. Feasibility Studies of Airbnb in the Nigerian Market shows Airbnb has been operational in Nigeria since 2014 and has given rise to hybrid hotels where people build houses and don’ t rent them out to tenants nor label them as hotels but rent them out com-

Wren Regent showcases real estate opportunities to Nigerians in Canada

L-R: Amara Musa, COO, Wren Regent Properties Limited; Valerie Akujobi, Founder, VTA Law Professional Corporation, and Idee Inyangudor, managing partner, GDSC Inc at the business consultation event in Canada.

Regent was trying to provide. According to the Lagosbased real estate firm, some of the solutions it was bringing to the property market included a consistent reporting system, a dedicated representative per transaction, and a transparent management system to boost investor confidence in the sector. Another focus of the event was on developments within Lagos that provided value for international investors and in effect provided avenues for wealth creation and high returns on investment. Valerie Akujobi, Founder of VTA Law Professional Corporation and Toyin Adewoye, www.businessday.ng

a real estate professional of Coldwell Banker Sarazen Realty, were also at the gathering and shared valuable insights into existing opportunities and legal requirements within Ottawa’s vibrant real estate market. The business consultation breakfast was highly successful and ‘broke the ice’ for Diaspora Nigerians in Canada looking to multiply their income by investing in Nigeria’s real estate industry. Potential investors were assured that using a credible real estate firm such as Wren Regent would ensure a secure, safe and rewarding investment experience.

cards to make reservations online. Even when people would like to try out the service, most will be afraid to put their card details online, for access to someone’s home which is not a hotel. This sentiment, for most people, remains an issue. Lack of trust: Most Nigerians do not believe that what they see advertised online will be the reality on the ground when they visit the location. This is a huge challenge. Security: Nigeria has a reputation for being unsafe with the police largely seen as inefficient. This gives room for distrust among the populace and even with tourists, who may then prefer to stay in more traditional accommodation like a hotel. Looking at the high crime rate in the country, many people are afraid of listing their homes on the service, mainly because they’re scared to bring complete strangers into their homes. There are still numerous stories of bad incidents between hosts and guests of Airbnb all over the world. Not knowing the real identity of the guest in your home who could be a potential kidnapper, armed robber or fraudster has made many stay clear of the service in Nigeria.

Spending patterns: Nigeria is largely in a pre-monetization era of the internet, at scale. While we have Konga, Jumia and other e-commerce businesses, the fact remains that it will take years to see dramatic evolution as regards spending over the internet. That has to happen before transactions which do not deliver value on the spot can be done by many people. Uber has a certain level of risk because you pay the driver when you get to your destination. But when it comes to knocking on the door of a strangers house to sleep there, it is a tough one. However, the commodification of trust is an industry challenge and everyone has a duty to make sure it is industrialised. Low brand awareness: Within Nigeria however, brand awareness is still quite low. Many Nigerians don’t even know the service exists in the first place. There are no effective marketing programmes in place to enlighten the public. For every 100 persons in Nigeria who know about Uber, only 10 of them know about Airbnb and only 5 out of the 10 know that Airbnb is operational in Nigeria. •Continues online at www.businessday.ng

GPP remodels The Pacific Lagos, still on track for completion on schedule CHUKA UROKO

ENDURANCE OKAFOR

ren Regent Properties Limited, in partnership with the Nigerian Canadian Association, Ottawa, has showcased investment and growth opportunities in Nigeria’s real estate sector to Nigerians in Canada. At a Business Consultation Breakfast which held recently in Canada, attention was directed at educating Nigerians in the country about the dynamic real estate sector in Nigeria, more especially in Lagos. Speaking on ‘Wealth Creation through Real Estate Investment in Nigerian and Canada’, the Chief Operating Officer (COO) of Wren Regent, Amara Musa, made a detailed presentation on the opportunities available for Diaspora Nigerians, and investors who had keen interest in wealth creation and sustainability in Nigeria’s commercial nerve centre. Musa addressed the real estate issues faced by Diaspora members. “Lack of reliable representation in Nigeria is the most popular reason behind the lack of confidence for international investors,” she said, highlighting the solutions Wren

pletely on the Airbnb platform, thereby making more money and avoiding taxes. It’s important to note that before Uber became established and its relative success drowned most of our misgivings, people in Nigeria had laughed at the idea of giving rides to total strangers. It simply was unthinkable, but it eventually happened. The possibility of Airbnb catching on is high as long as the hosts provide their guests with great experiences. It is up to us to get it right with professionalism and customer service. There is a large market of international guests that use Airbnb. Thus, focusing on that market will yield better results than targeting domestic clients who are hesitant to use their bank cards. As a host, one simply needs to provide a secure location and maintain good reviews and ratings to win the trust of new guests. Challenges of Airbnb in Nigeria (Why Airbnb may fail to attract the same success as Uber). Issues that Airbnb may face given the peculiarity of the Nigerian market can be summarized as follows: Fear: It’s difficult to get people to use their debit

lobal Property Partners (GPP), a subsidiary of leading Premium real estate developer, Cavalli Business & Investment Group, has remodeled of its iconic The Pacific Lagos Project on Ozumba Mbadiwe Street, Victoria Island, Lagos. The remodeling, GPP explained, was made in line with the its vision of developing a best-in-class mixed-use real estate development in Nigeria as well as the specifications of some of the subscribers to the iconic Twin Towers. “The Pacific Lagos is now bigger, even better and offers more value”, said the CEO of GPP, Emmanuel Odemayowa, explaining that “in place of

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the former design, what we have now are two distinct luxury towers—one with 10 suspended floors of premium office space for commercial use, as well as 12 floors of exclusive hotel apartments for residential purposes”. Odemayowa assured they were still on track to complete the project on schedule, given the resources already committed and the progress they had made with preliminary engineering, procurement and construction works on the project. “We have assembled a team of experienced, worldclass professionals to ensure The Pacific Lagos meets the very exacting standards envisaged by our clientele in terms of quality, expertise and

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the cutting edge facilities we have outlined for the project”, he said, acknowledging that the market reception to the project has been enthusiastic. Among the remodeled facilities in The Pacific Lagos is the Recreational Floor which has been expanded and moved to the third floor for both Towers with facilities meant to enhance its “Work. Live.Play” concept. The facilities on the recreational floor include large terrace space for outdoor relaxation for both office and residential occupants, a well equipped gymnasium, restaurants & bar, shops and generous space for various indoor games. “Also, the 10 Office Floors in the building are designed for optimal efficiency, functionality and convenience in one of the most strategic locations in Lagos,” Odemayowa noted, adding that the 12 floors of residential space comprise 1 and 2 bedroom ensuite hotel apartments modeled on five-star hospitality accommodation. He also said the new highrise project was in line with the Cavalli Group’s vision of helping to reduce Nigeria’s severe housing deficit through the development of real estate modeled on international standards, adding that the Group had completed various real estate projects across Lagos.

Tuesday 19 November 2019

BUSINESS DAY

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

Higher

Human Capital

Teach for Nigeria deepens basic education prospects with Ogun State partnership KELECHI EWUZIE

n a bid to further strengthen the ideas of improving the quality of basic education for Nigeria’s most marginalised; Teach for Nigeria, a Non-profit organisation and the present administration in Ogun State are working out further partnership arrangement to boost the education sector. In furtherance of this, Gbenga Oyebode, Board Chairman, Teach for Nigeria and his team visited the governor of Ogun State recently. Speaking at the courtesy call in the Governor’s office, Oyebode said the visit was to reaffirm Teach for Nigeria commitment to deepen relationship with Ogun State and to seek ways to deepen that relationship. Oyebode observes that Teach for Nigeria would not have been able to effectively carry out the interventions it has done since 2017 without the support of the Ogun state government especially the ministry of education and

State universal basic education (SUBEB). He also called on the governor to engage some of the teach for Nigeria fellows adding that one of the great things about the teach for Nigeria programme is that a significance number of these fellows stay in the education space as Ambassadors, regulators while others are teachers. “The very fact that they participated in the programme here puts them in a better position to assist the state government around the education projects and so we would like an opportunity for them to engage with the state”. Oyebode said. Dapo Abiodun, Ogun State governor while welcoming the Teach for Nigeria delegation reinstated the commitment of his administration to this project of teach for Nigeria stressing that the government is keen to restore education to its pride of place. Abiodun observes that Ogun State has the highest number of tertiary institutions in Nigeria, highest number of secondary schools

and probably the highest enrollment of students in basic education as well. “We are the education capital of Nigeria and we want to ensure that that those numbers match performance”, he said. According to the governor, “On Assumption of office, I promoted 10,000 teaching and non teaching staff that were due for promotion since 2016 because you have to have a motivation workforce and we are doing that across board in the civil service”. “We have also looked at how to make the learning condition better and we also looked at the getting a uniform curriculum and also ensure we use technology to ensure teachers stay in class. “We are also recruiting teachers. We want to make sure that we don’t just recruit teachers, but to recruit the right quality. The fellow of teach for Nigeria have demonstrated that they have a different kind of orientation”. Abiodun further urged the Teach for Nigeria delegation

Rivers State pupils beat off competition to win 2019 LANLC KELECHI EWUZIE

avid Emmanuella and Barikpoa P r o s p e r, f r o m Community Primary School, Rivers State have emerged winner of the sixth Lafarge Africa National Literacy Competition (LANLC) The pupils were adjudged winners after a keenly contested grand finale in Lagos while Ogun and Enugu States won the second and third positions respectively. The winners were awarded scholarships, trophies and various gifts. The grand finale with the theme, ‘Bridging the Literacy Gap Together’ which had in attendance key stakeholders from the private and public sectors, equally created opportunities for the children to engage and interact amongst themselves, explore various book exhibition stands, take reading sessions and also participate in a spelling bee competition. Mobolaji Balogun, chairman of Lafarge Africa Plc in his opening remarks, said “Literacy is crucial to the development of any society and it is described by UNESCO as a driver for sustainable development in that it enables greater

participation in the labour market; improved child and family health and nutrition; reduces poverty and expands life opportunities”. According to him, “As an organisation, Lafarge Africa continues to invest in educational interventions including scholarships and bursary awards for children within our host communities, training programmes, renovation and construction of classroom blocks and other facilities within schools, computer IT training, skills acquisition programmes among others. ‘For a country like Nigeria, there is an urgent need to work towards securing a sustainable future. We believe that a sustainable future will enable growth, global peace and security and technological advancement. We need to prepare our children for a future where they will compete globally with ease. That future begins with improving the literacy levels of every child in Nigeria today.’ Launched in 2014 as a flagship CSR intervention by Lafarge Africa Plc, the Lafarge Africa National Literacy Competition has since grown to become an annual national initiative positively impacting children and teachers across www.businessday.ng

Nigeria. Speaking at the event, the Country Chief Executive Officer, Lafarge Africa, Michel Puchercos commended all the students that participated at every stage of the competition. “It is rewarding to watch these brilliant children grow and improve every year. We dream of a bright future for every Nigerian child through basic education. Six years on, the visible outcomes we have seen encourage us to do more. We have touched the lives of more than 700,000 primary school pupils in 1,665 schools across 544 local government areas. The Competition is delivered across all 109 senatorial districts in all 36 states of the federation and the FCT and is organized with the support of the State Universal Basic Education Boards (SUBEBs) in all the states of the country, with our implementing partners – Ovie Brume Foundation and TEP centre”. As a company, we are proud of this achievement and do believe that it will inspire more well-meaning Nigerians and citizens all over Africa and the world to contribute to improving the lives of the people around them, in any way they can, he concluded.

to map out partnership plans on how to assist the State in the retraining of teachers adding that it is not enough to have new infrastructure in place, teachers must be trained to drive the process

of transforming education in the state. “I want to assure you that we are committed to the collaboration adding that education remains a front burner issue for the state be-

cause we see direct relationship between education and unemployment, criminality. This administration will give Teach for Nigeria all the support required and even more” the governor said.

L-R: Segun Ogunsanya, chief executive officer & managing director, Airtel Nigeria; Awuneba Ajumogobia, chairperson Governing Council, Grange School; Bola Awolowo, former Parent, Grange School; Segun Awolowo, executive director, Nigerian Export Promotion Council (NEPC) and Yomi Badejo- Okusanya, Grange School Alumnus & Group managing director, CMC Connect Limited at Grand School 60th Anniversary Fundraising Gala and Unveiling of the School ‘5 Campaign’ themed ‘Unfolding The Future’ held at MUSON Center Lagos at the weekend.

Grange school marks Diamond anniversary, unveils N2.5B five campaign projects

range School an independent coeducational day school with limited boarding facilities says it has successfully delivered to its students the highest standards of British Curriculum education in the last six decades as it celebrates its 60th Anniversary in Lagos. As part of activities marking the celebration, the school unveiled its 2.5 billion naira five campaign mission projects that would benefit all the current students as well as generations of students to come. Dayo Lawuyi, Board Chairman, Grange school while speaking at a dinner held at Muson center Lagos said that the basic role of a school is to provide a solid foundation and life skills which are elementary tools for success in life. Lawuyi who was represented by Segun Ogunsanya, chief executive officer and managing director, Airtel Nigeria observed that performing these roles is never an easy task, but Grange school has risen to the challenge over the last 60 years and will continue to do so. According to Lawuyi, “A cardinal effort in confronting

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these challenges is a shift from the traditional curriculum to a holistic curriculum. This is informed by our mission to provide an excellence based curriculum while celebrating Nigerian history and culture within a creative and motivated environment aimed at developing a 21st century child positioned for global relevance”. Lawuyi further stated that the school continues to advance with emerging trends in learning, adding that Grange students continues to excel in their internal and external examinations, sports and performing arts competitions which moulds them complete students. “At Grange, we are committed to the continuous upliftment of our students and the advance of our society because we understand that education is life. To live up to this commitment, we must continue to evolve as much as possible with the emerging trends in the educational industry”, he said. The board chairman opines that the vision of unfolding the future and the ability to do this effectively will be made possible by the generous support, @Businessdayng

goodwill, commitment and donations of parents and other stakeholders. “Looking forward, the future is highlighted by the ‘five campaign’. To achieve a state of the art boarding accommodation; a D and T Multipurpose building to teach students how to be innovative and make creative use of a variety of resources including digital technology in 21st century learning space”. “The other projects include the establishment of world class Science Technology, Engineering Arts and Mathematic (STEAM) center; Construction of an arts theatre that will build the confidence of the students through the acquisition of skills in music, drama and fine art”. “The last project is an indoor sports center to give students the liberty of not having to worry about the weather whole enjoying sporting activities”, Lawuyi added. Earlier in her opening remarks, Awuneba Ajumogobia, chairperson, Governing Council, Grange School said the school was founded as a primary school in September 1958 to provide UK equivalent education in Lagos.

Tuesday 19 November 2019

BUSINESS DAY

EDUCATION Community leaders, scholars commend Eroton E&P on scholarships …Task the oil company on educational development

KELECHI EWUZIE

Ignatius Chukwu

ommunity leaders from host communities and scholars in the Nigeria Delta region have commended Eroton E&P for steadily helping brilliant and indigent brains in the area through its scholarship scheme. They have also called on the company and other oil companies to boost educational development by investing in schools in the area with equipment and facilities to modern standards. Eroton is a growing name in the Niger Delta since 2014 when it acquired 45 per cent to emerge as the operator of the JV from Shell in Oil Mining Lease 18 covering oil field in the Cawthorne Channel. The communities in the area say they want investment in their education sector and have commended the company for starting with scholarships. Thus, hundreds of students from both secondary and tertiary institutions in the area besieged the ICT Centre to begin tests for scholarship slots thrown open by Eroton. The students were selected by teachers of various schools after some screening. Sources said Eroton informed the host communities about the scheme and they asked teachers in their schools to

FGGC Sagamu Alumni ignite creativity, vocational skills among students

select the best brains to forward to the company. The scholarship selection exercise which is said to be in its third year caters for brilliant scholars from the communities. Eroton insiders told newsmen at the venue of the exams that the scheme plus other donations were part of the JV’s “Give Back” campaign. Testifying to the needfulness of the scholarship scheme, a teacher from Comprehensive College in Abalama in Asari-Toru local council area, Bobmanuel David, who said he came to present his students for the exams, said his school was

lucky to be participating in another round. He said the process was good and that the community is happy to be a host to Eroton and advised the oil company to sustain the scheme. On her part, Otelemabo Oribani, an English teacher from Kalabari National College, pleaded for transparency in the selection process. One of the candidates in the junior primary section, 11-year-old Florence Israel, year one from Saint Gabriel State School in Krakrama said the exam was a bit tough. Those in the universities seemed to command more

confidence. Sandra GinisHarry from federal University in Otueke, Bayelsa State, said the exam was hard because it questioned critical reasoning, numeric and current affairs, all tested on computer. Agreeing with her, a year one medical student from the University of Port Harcourt, Emughedi Goodnews Young from Abual-Odual local council area said the scholarship is truly for the most brilliant, saying he was determined to win a slot to help his parents. He said the test is not all about knowledge but on skills. He said the process seemed transparent so far.

etermined to ignite the requisite creative and vocational skills among its current and past students, the Federal Government Girls’ College (F.G.G.C.) Sagamu Alumni Association recently organised a 3-day Skill Acquisition Programme tagged Stimulate Passion, Unleash Resilience (S.P.U.R) 2019. The Skill Acquisition Programme featured eight facilitators who are alumni members, along with six co-facilitators who exposed over 500 student participants to the techniques of making a variety of products such as coconut oil, coconut candy, bread, pastries, hair accessories (fascinators), wigs, bags, purses, venue decoration and household cleaning liquid. Titilayomi Soyemi Akinseinde, Alumni Association President while speaking at the opening ceremony stated that S.P.U.R 2019 was organised with the objective of igniting creativity in the students and equipping them with vocational skills that will equip them to be self-sufficient and successful when they graduate from the college. Akinseinde a member of the 1989 set observes that as one who has been in the workforce for years, I have come to the conclusion that

the place of skill acquisition should and can never be underestimated or undervalued. This is the reason we put this program together to enable the girls become contributors to the economy, while sharpening their entrepreneurial skills”. “The heart and mind of the Alumni is set on making a difference in and impacting the lives of the students and therefore I admonish every student present to grab this opportunity with both hands and learn how to create wealth at your leisure after leaving the college’ she concluded. The School Principal, Esther Akamo, expressed delight and appreciation to the Alumni for all the resources deployed to make the program a huge success. “It is very rare to find Alumni who still care for the school and its students, and I am very grateful to everyone that was a part of this. The need to acquire skills cannot be overemphasized and I feel so lucky that this is happening during my tenure as principal”, Akamo said. The 3-day training programme ended with the students also learning the importance of entrepreneurship and hardwork, as well as quality, health and safety in production and there were opportunity for them to showcase their newly acquired skills to their parents and guardians.

Greensprings School adopts new innovative technology to enhance teaching, learning …launches Wowbii Interactive Boards KELECHI EWUZIE

reensprings School as Nigeria’s first thinking school says it is determined to actively lead the charge forward in using technology and research to explore different aspects of education while preparing students for college, career and entrepreneurship by creating business incubators and readiness centers on campus. The school’s administration recognises how the digital revolution is reshaping the education industry and are adopting tools and technology for 21st century students. Preceding the introduction of Virtual Reality, Augmented Reality and the Air and Sea laboratories, the launch of Wowbii boards in classrooms across Greensprings campuses

marks the beginning of what can aptly be described as a “technology explosion”. The Wowbii s cre ens, which were initially tested at

Greensprings Ikoyi campus before scaling to the secondary and elementary levels at other campuses, serve as a very useful learning tool for teachers

and students because of its interactive features and visual displays. Barney Wilson, deputy director of Education at

A student of Greensprings School interacting with the Wowbii board during an Economics class www.businessday.ng

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Greensprings described the Wowbii boards as “a teacher’s best friend and an assistant to the learners”. He also acknowledged that teachers were ready and curious to experiment with the new technology, adding that “here at Greensprings, we have teachers who are tech-savvy. Our method was to choose rooms and simply put the screens in the room to give teachers and students an opportunity to use them.” “Students are technologydriven. They are using technology at home and because they are already technical people, they no longer listen to just the teacher, they can also see immediately what the teacher is talking about.” So far, the Wowbii boards were introduced to 22 new rooms and have been well received with excitement. A @Businessdayng

Year 10 Economics teacher observes that the students were very excited when he switched on the Wowbii screens.” Unlike the regular whiteboards, whereby I have to always wipe off my notes after every class; the Wowbii electronics boards enable me to save my notes for each class so I don’t have to start all over again. This makes me more productive, as I can always refer to my notes from previous classes.” he added. A Year 10 student pointed out that it’s been so much fun using this board because it grabs everyone’s attention and makes learning more exciting. When we first saw it, everyone started clapping.” Comments from other teachers revealed that; “the board has helped take away the abstract part of learning, making it more concrete and easy to comprehend.

Tuesday 19 November 2019

BUSINESS DAY

Markets + Finance

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

Wapic Insurance’s underwriting profit hits four-year high BALA AUGIE

hile most insurance companies are struggling with a harsh regulatory and operating environment, Wapic Insurance Nigeria Plc is thriving, as evidenced in an efficient underwriting capacity. Data gleaned from the nine months 2019 financial statement of Wapic shows it spends less on operating expenses to generate each unit of premium income, which means it creates economies of scale for its front and back office operations. The rapidity of growth in premium income in the last six years validates the launch of market penetrating products by management and board of directors. The management and board of directors of Wapic are ingenious, as they take advantage of a high yield environment to invest the float in bonds and equities market, generating investment income that adds impetus to profit. Increase in net premium as result of innovative products For the first nine month through September 2019, the company’s gross premium written increased by

Aigboje Aig-imoukhuede, chairman, Wapic Insurance Plc

25.56 percent to N12.67 billion from N10.09 billion in the corresponding period of 2018 as a result of the launch of market penetrating product that allures customers across the country. A breakdown of gross premium written shows Motor segment surged by 139.83 percent to N1.71 billion while the company relised N1.065 billion from Group Life business. Gross premium income (GPI) spiked by 38.86 percent to N11.97 billion in September 2019 as against N8.62 billion the previous year while reinsurance expenses surged by 102.53 percent to N6.13 billion in the period under review.

Improved underwriting profit validates efficieny ratio Wapic Insurance’s underwriting profit was up 78.83 percent to N2.45 billion from N1.37 billion the previous year; this shows the company has an appropriate mix of claims and expenses that minimises overall cost. The insurer has been honoring its obligations to policy holders even amid a high inflationary environment and macroeconomic uncertainties, spending less on claims expenses to generate each unit of revenue. Total net claims stood at N2.20 billion in the period under review, this represents a 35.05 reduction from N3.11 billion incurred the previous year. Claims ratio fell to 39.49 percent in September 2019 from 57.07 percent the previous year; this means for every N100 generated in net premium income, it expends N44 on marketing, administrative and distribution expenses that relates to claims in the period under review. However, underwriting expenses were up 22.38 percent to N2.46 billion in the period under review from N2.01 billion the previous year while underwriting expense ratio increased to 44.02 percent in September 2019 from 36.82 percent the previous year. Total operating expenses were down 7.71 percent to N3.23 billion in the period

under review from N3.50 billion the previous year. Wapic is spending less on management and sundry expenses to generate each unit of revenue as total operating expense ratio fell to 57.52 percemt in September 2019 from 64.17 percent the previous year amid ineficinecy in power supplies and transportation that undermine businesses across the country. A lower cost shows the company is able to create economies of scale for their front and back office, as it continues to turn each Naira invested in sales into higher profit. Profit surges on lower costs, increased revenue Profit after tax (PAT) surged by 238.85 percent to N972.89 million in September 2019, from N287.28 million the previous year while profit after tax spiked by 127.36 percent to N1.08 billion as at September 2019 from N475.44 billion the previous year. Wapic is efficient, as net margin spiked to 17.01 percent in the period under review from 5.25 percent the previous year. Financial assets were up 5.10 percent to N8.24 billion in the period under review from N7.84 billion the previous year. The growth in financial asset is largely driven by fixed income securities of N1.98 billion in the period under review and corporate Eurobond of N1.32 billion respectively. Investment in associates increased by 5.59 percent to N9.25 billion in the period under review as against N8.76 billion as at September 2018. While Wapic Insurance is recording double digit growth in earnings, it operates in a tough business environment, which is why the industry lags its peers in the frontier and emerging markets. Nigeria’s total 2018 insurance premiums are reported at N400 billion ($1.1 billion) compared with nominal GDP of N129.1 trillion , thus 0.31 percent of GDP. In

comparison, a country like India with similar US dollar GDP per capita to Nigeria has an insurance industry equivalent to 3.69 percent of its GDP. The economy has been growing sluggishly since the country existed recession in 2016, as GDP expanded by 1.94 percent in the second quarter (Q2), lower than the 2.10 pecent and 2.34 percent expansion in the first quarter (Q1) and fourth quarter (Q4) of 2018. Unemployment rate is at an all time high of 23 percent while over 50 percent of a population of 200 million people live on less than $1.98 a day, signaling that taking a cover is the least of the worries of Nigerians. They have to insure their stomach, first. Just like many businesses, insurers incur huge costs on diesel oil to power generators at head office and branches across the country as electricity from the national grid is unreliably inconsistent. That adds to overhead costs, a monster that erodes profitability.

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

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In order to strengthen the insurance industry so that it competes with its peer across the globe, the National Insurance Commission (NAICOM) has jerked up the minimum capital requirement of companies. The aim of the new rules is to ensure that insurers have a solid capital base that will enable them take on more risk,grow premium and magnify shareholders earnings. In the new capital base, life insurance companies will now have a minim paidup capital of N8bn from its previous N2bn, General Insurance companies will now have to recapitalize to N10bn from N3bn, while Composite Insurance companies will now need N18bn to underwrite businesses from the previous N5bn minimum capital. The new capital base requirement also affected reinsurance companies who will now have to raise their minimum paid-up capital from N10bn to N20bn if they must remain in business.

Tuesday 19 November 2019

BUSINESS DAY

BDTECH

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Alibaba, Jack Ma Foundations invest hugely in African entrepreneurs …supports ecosystem with $1million grant, as Nigeria’s LifeBank wins $250,000 Stories by Jumoke Akiyode Lawanson

frica’s thriving entrepreneurship ecosystem filled with ambitious youths using technology to create businesses that provide solution to some of the continent’s most disturbing problems, has been recognised and rewarded at the Africa Netpreneur Prize Initiative (ANPI2019). The event organised by the Jack Ma foundation and Alibaba foundation, which took place in Accra, Ghana at the weekend awarded a total of US $1million to the top 10 finalists from across Africa, as Nigeria’s Temie Giwa-Tubosun, founder of LifeBank, a medical distribution company that uses data and technology to help health workers discover critical medical products such as blood, as quickly as possible, and recently launched its first drone delivery for blood, emerged in first place, winning $250,000 in grant prize. The final event called ‘Africa’s Business Heroes’ saw the top 10 entrepreneurs pitching their business to four prestigious judges including Jack Ma, founder of Alibaba Group and Jack Ma foundation, Strive Masiyiwa, founder and executive chairman, Econet Group, Ibukun Awosika, chairman of First Bank of Nigeria and

founder of the Chair Centre Group, and Joe Tsai, executive vice chairman of Alibaba. Speaking on her win, Temie-Giwa Tubosun of LifeBank said; “It is an incredible honour to be named Africa’s Business Hero. I was truly inspired by my fellow winners at today’s Netprener Summit. The funds will give me resources to grow LifeBank and expand our presence in Nigeria and through-

out the rest of Africa. I look forward to continuing my journey to solve problems and make a significant impact on the future of Africa.” Omar Sakr, founder and CEO of Nawah-Scientific from Egypt pitched his business which is the first private research centre in the MENA region focused on natural and biomedical sciences, offering analytical and scientific services online and on de-

mand, and came out in second place winning $150,000 in grant. While 25-year-old Christelle Kwizera, founder of Water Access Rwanda came third after pitching her life changing business, a safe water micro grid that reclaims broken boreholes and transforms them into solar powered water kiosks and pipelines, so as to provide clean, safe to drink water, to rural communities in Rwanda. Kwiz-

L-R: Aruosa Osemwegie; senior manager, people and organisation, PwC, Nkemdilim Begho; CEO, Future Software Resources, Tosin Faniro-Dada; head of start-ups, Lagos State Employment Trust Fund, Tayo Olosunde; executive director, mindthegap.ng, Lars Johannisson; country manager, Tek Experts Nigeria, at the inaugural edition of the Tek Experts Open Day Forum in Lagos recently.

era won $100,000 in grant prize from the Alibaba and Jack Ma foundations. Other contestants who were given $65,000 each include; Waleed Abd El Rahman, CEO of Mumm in Egypt, Ayodeji Arikawe, co-founder of Thrive Agric from Nigeria, Mahmud Johnson, founder of J-Palm from Liberia, Tosan Mogbeyiteren, founder of black Swan from Nigeria, Chibuzor Opara, co-founder, Drugstoc Nigeria and Moulaye Taboure, co-founder and CEO of Afrikrea from Cote D’Ivore. According to Jack Ma, “the finalists who competed in Africa’s Business Heroes, should be an inspiration for Africa and for the world. Each of these entrepreneurs looked at big challenges facing their communities, and saw them as opportunities.” “It is my strong belief that entrepreneur heroes like these finalists, will change the world – creating companies that drive inclusive growth and opportunity for the continent,” he said. Ibukun Awosika said she was truly amazed by the wealth of creative talent and intelligence on the continent. “What really struck me about the finalists was that they each addressed specific problems with a specific African solution in a fresh way, leveraging technology that wasn’t available previously. If this is an indication of the future of entrepreneurship on the continent, then Africa’s future looks bright,” Awosika said.

Smile offers customers more value on new data plans

etermined to help cushion the biting effect of the inclement economic times, Smile Communications, a 4G LTE broadband service provider, Smile is now offering double the value (100 percent increase in data volume) on its existing 30 days’ data plans at more affordable prices. Courtesy of the new ValuePlus data offerings, Smile says that new and existing customers are assured of the best bargains; in service quality and

rendition. Customers on the Smile network will instead of the old offer of 2GB at N2,000 will now have 5GB at N3,000. For 3GB that was priced at N3,000 consumers will now get 7GB at N4,000. Similarly, instead of 5GB at N4,000 customers will now get 11 GB at N5,000 and in place of 7GB at N5,000 Smile now offers 15GB at N6,000. There are also other packages that have transformed the old 10GB at N7,500 to 21GB at N8,000 as well as 15GB at N10,000 to 31GB at N11,000.

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The main objective of the ValuePlus data plan is to give double value at more affordable prices to its customers. According to Akin Alayoku, Ag managing director of Smile Nigeria, the offerings are unprecedented in the range of the data plans on offer and unsurpassed in the value that will accrue to the customers who will take advantage of the offerings. Applauding the initiative, Alayoku explained that the new improved data plans as a package are as robust as they

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are versatile. Each of the offering is tailor-made for both the individual and corporate users. He urged forwardlooking customers and prospects alike to embrace any of their preferred offerings and savor the benefits of double value. Alayoku assured Nigerians that Smile is continuously innovating to beat existing market benchmark, all in a bid to provide products that will serve their customer’s best interest in the present turbulent market landscape.

@Businessdayng

He restated that Smile’s vision and mission is to be the broadband provider of choice and to enable its customers to benefit fully from the Internet world for data and voice. “Smile will continue to bring value to its users as a long term strategy and bring explosive growth in mobile data usage. We will continue to innovate to meet the demands of users where mobile data is becoming a must-have that impact our daily lives and continuously exceed their expectations,” he said.

Tuesday 19 November 2019

BUSINESS DAY

BDTECH

E-mail: jumoke.akiyode@businessdayonline.com

Techplus repositions to deepen Nigeria’s digital ecosystem Jumoke Akiyode-Lawanson

opular technology conference and exhibition, Techplus is switching up its annual activities and programs to focus more on creating an inclusive pedestal that will help build a stronger digital economy in Nigeria and foster development through technology. Eniola Edun, general manager, Techplus, who spoke to journalists at a pre-event breakfast meeting that brought together technology experts, government executives and business leaders in Lagos at the weekend, said that the organization has decided to take an assessment of their position in the ecosystem and re-invent themselves to further deepen the county’s digital ecosystem. “We started a journey early this year that is evolving our organization into a platform for tech inclusion, positioning, connecting and enabling innovators in the ecosystem for social change” Edun said. “We believe we can function as a voice that can project commendable social innovators so that they can attract quality partners and assistance that can get them to next level. We have been

leveraging on the goodwill that was built by the brand in the last four years and this journey has led us into discovering a lot of talents outside the concentrated areas of Lagos and Abuja that we will gladly share at this meeting,” he said. One of the newly discovered talents, allowed to showcase his invention at the Techplus event is Ahmad Moddibo of the NorthEast Humanitarian Innovation

Hub (NEHIH) where the players are making a difference and finding home-grown tech solutions to humanitarian challenges in the North-East. Moddibo presented a documentary on how he and his team used 3D printing machines and 3D Labs installed by the NorthEast Humanitarian Hub, to create prosthetic limbs for many disadvantaged persons who have lost

L-R: Olatunbosun Alake; special adviser to Lagos State Governor on Innovations, Bridget Oyefeso-Odusami; head, marketing and communications, Stanbic IBTC, Hakeem Popoola Fahd; Lagos State commissioner for science and technology, Eniola Ebun; general manager, Techplus, Ahmad Moddibo; chief executive officer, North-East Humanitarian Innovation Hub (NEHIH), and Wendy Okolo; Aerospace research engineer at NASA Ames Reasearch Centre and key note speaker at the flag-off of Techplus 2019 themed Digital Social Innovation in Lagos.

Samsung unveils premium foldable smartphone …Targets high-end customers in Nigeria Jumoke Akiyode-Lawanson

amsung has launched what is said to be the most innovative phone of 2019, its Galaxy Fold smartphone into the Nigerian mobile market. The Galaxy Fold is a premium device created for Samsung’s high-end customers, and is the first commercially available foldable device in the market globally. Since Samsung globally unveiled the Galaxy Fold and created a new mobile category, a lot of buzz has been created about the extraordinary

their legs in Nigeria’s war-torn North-East region. Also speaking, Silas Adekunle, a young Nigerian engineer, inventor and technology entrepreneur known for creating the world’s first intelligent gaming robot, said there are huge benefits in AI and robotics, and advised strongly on the need for all stakeholders to contribute to the growth of this aspect of learning to avoid Nigeria

device. Not only is the Galaxy Fold infused with never-seen-before integration of tablet and phone, but it also encompasses incredible innovation in material, engineering and display. David Suh, managing director at Samsung Electronics West Africa says, “Samsung prides itself on being at the forefront of design and technology innovation and the Galaxy Fold is a testament to this. Quite simply, it’s a device that will change the way we use smartphones, as well as what we expect them to do into the future. I’m really looking forward to seeing user responses to this amaz-

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ing device.” The device which retails for N830,000 features the world’s first 7.3inch infinity flex display, which folds into a compact device with a cover display. Galaxy Fold offers a powerful new way to multitask, watch videos, play games, and more – bringing to life new experiences and possibilities years in the making. According to Samsung, its “Galaxy Fold doesn’t just define a new category, it defies category.” When folded, Galaxy Fold’s slim silhouette slips easily into your bag or pocket. It also fits comfortably in the hand, putting all apps within easy reach. When opened up, the displays work together seamlessly with impressive app continuity, allowing users continue effortlessly with whatever they may have been busy with when folded up. The dual battery capacity is a game-changer that uses and recharges both cells to prevent overcharging. To save power, the intelligent battery management puts apps not in use on reserve. Thanks to the six pro-grade cameras, users are sure to capture stunning photos and videos. The revolutionary Galaxy Fold launched in Nigeria on the 14th of November 2019 and will be available in retail stores from the 29th of November 2019.

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lagging in this area. “There is need to create an educational scheme that will expose young Nigerians to this relatively new field in the country so that we can have a generation of Nigerians that will be inspired to grow their skills in this very strategic area,” he said. Hakeem Popoola Fahm, Lagos State commissioner for Science and technology, commented on the presentations and other plans highlighted by Techplus. He said that state programs like the establishment of the e-Learning Centre designed to improve the quality of digital education in our institutions, the establishment of Ikeja Digital Village, The Lagos Smart City project as well as the Code Lagos initiative that is aimed at training 1 million coding experts in Lagos will all find a platform like Techplus very relevant in the effort of the state to build a world class digital economy. “This event is an eye opener for every one, it shows what our youths can do with technology and when you look at Tech plus they are doing a great service, not only for their business but for the nation. They have shown how technology is being applied to solve a host of issues,” Fahm said.

SystemSpecs to foster entrepreneurship among Nigerian youths Chinyere Okeke

ystemsSpecs, a Nigerian company known for creating financial software solutions, is set to foster entrepreneurial skills among youths and create growth opportunities in the ecosystem through SME programs and youth conferences. John Obaro, managing director, SystemsSpecs who spoke at an SME conference in Lagos at the weekend, said that the future of any economy and nation is in the development and strength of small and medium scale enterprises, and so, it is only right to encourage small business organisations in Nigeria. “Having seen the need in this area of the economy, SystemSpecs, as an organisation, as part of our ways to encourage the ecosystem, we will not only be sharing experiences but most importantly, organizing programs like this and trainings to help the ecosystem,” Obaro said. Nigeria is said to have one of the youngest population in Africa. These youths are full of energy, skills and clarity of purpose. Experts say that with the right level of support, these raw skills will be harnessed to turn around the fu@Businessdayng

ture of the country for good. According to Obaro, with the rapid growth of the Nigerian population, the governmental structures cannot cannot everyone, hence the need to promote SME development. “Many people cannot fit into the large organisation of governmental structures but can operate as smaller units of SMEs so the more SMEs, the better for all of us in terms of job creation and economic development. It is what we are able to do with SMEs that will create growth opportunities for the economy itself,” he said. SystemSpecs is focusing on sharing experiences of a generation of startups and brainstorm with the younger generation on the next phase of growth. “A lot of things are changing in our world, the generation to come would never believe that the world once existed without mobile phones, yet it just came into Nigeria about 20yrs ago. So necessarily, you must adapt to these changes. Robots are coming, a lot of artificial intelligence will be coming in, so industries also need to recognize that technology has a significant role to play in the growth of our economy and sustainability of SMEs,” Obaro said.

Tuesday 19 November 2019

BUSINESS DAY

Investments

ENERGY INTELLIGENCE

Market Insight Companies Commodity Tracker Policy

OIL

GAS

PETROCHEMICALS

POWER

Market

OPEC cut: Nigeria oil production decreases by 37,000bpd in October DIPO OLADEHINDE

igeria’s crude oil production decreased by about 37,000 barrels of per day in the month October 2019, according to data from the 14-member oil cartel OPEC. The organisation says production fell from 1.84 million bpd recorded in September to 1.81 million bpd recorded in October 2019. This follows efforts by Nigeria’s regulatory authorities to oil companies cut down production from their largest producing fields in order to meet its OPEC obligation. One clear case is the French’s Total operated Egina, which averaged 203,000 bpd in August 2019 and was only allowed to produce 180,000 bpd in October 2019. “Strict adherence to OPEC’s production cut may threaten Nigeria’s oil revenue except we manage to keep oil price above $60,” said Charles Akinbobola, an energy analyst at Lagos based Sofidam Capital. Since 2017, the group and allies

including Russia have cut production by about 1.2million, helping to lift international prices and prop up weak oil prices. Higher oil production coupled with higher oil prices has often meant Nigeria, Africa’s biggest oil producer, can earn more in foreign exchange and fund its budget deficit. This is because oil

accounts for 90 percent of Nigeria’s foreign exchange and 85.6 per cent of Nigeria’s total exports. The decision by OPEC to enforce members production quota could toughen Nigeria’s economic situation in 2020 fiscal year as the federal government adjusts to the realities of dwindling oil revenue. Recall, Nigeria has been pumping

1.84 million bpd in recent months instead of its target 1.685 million bpd. OPEC pumps about a third of the world’s crude and while it doesn’t target a specific oil price, it adds or removes supplies in the market to keep prices stable. In its last report before the December meeting, OPEC said its oil output in October jumped by 943,000 bpd to 29.65 million bpd, according to figures the group collects from secondary sources as Saudi supply recovered from attacks on oil plants that cut supply. The world biggest oil exporter, Saudi Arabia added 1,094 bpd into the market in October, bringing output to just less than 9.8 million bpd and delivering its Energy Minister Khalid al-Falih’s vow to pump well below 10 million bpd. The report suggests there will be a 2020 surplus of 70,000 bpd if OPEC keeps pumping at October’s rate and other factors remain equal, an amount less than the 340,000 bpd surplus implied in September’s report before the Saudi attacks.

Policy

Minister canvasses collaboration to tackle environmental challenges, deepen gas investments ...appoints Justice Deferaka Technical adviser, manager of gas flare sales programme ISAAC ANYAOGU Nigeria’s environmental challenges requires the adoption of a sound and integrated environmental management strategy through stakeholder collaboration and public involvement says Timipre Sylva, minister of state for petroleum resources. While giving the keynote address at the Environmental Society (NES) conference in Benin, Sylva, who was represented by Justice Derefaka, recently appointed technical adviser and programme manager of the Nigerian Gas Flare Commercialisation Programme (NGFCP), said the Nigerian environmental management narratives and plan need to consider and balance “what I would refer to as the three “Es”: environment, economy, and equity.” The global community has adopted over 500 environment-related international treaties and agreements including 195 concerned with water, 180 with chemicals and wastes, 155 with biodiversity, 60 with the atmosphere including climate change, and 45 with land use and Nigeria is signatory to these treaties. Sylva said that as part of an initiative to identify a core set of environmental goals, the UN environmental Programme (UNEP) examined progress in achieving 90 important goals from these treaties and found that only 4 of them showed significant progress globally. “You all will agree with me that there is much unfinished business on the international environmental agenda how much more for Nigeria,” the minister said. Citing a report by the World Economic Forum which says that six

Timipre Sylva

(6) of the ten (10) greatest risks, in terms of likelihood and impact, are environment-related, the minister said that the environmental challenges are complex and interlinked, not only in themselves but also with social and economic issues. “As a nation, we have committed ourselves to the delivery of the SDGs and the accompanying targets. It is not possible to have sustainable social and economic development if we allow our environment to degrade. Alongside alleviating poverty, there is clearly a need to prevent and reduce all forms of pollution. He warned that climate change is altering the character of the country hence “we must increase our collective efforts to prepare and protect ourselves, our communities, and our environment from existential threats that climate change will bring. We are running out of time.” He said policies need to have a firm scientific basis. “For us in government, a key way we can do this, is our emphasis on collaboration. My Ministry operate under a consensus governance system, and this approach to working together translates to how we work with inwww.businessday.ng

L-R: Technical Adviser on Gas Business & Policy Implementation to the Honorable Minister of State for Petroleum Resources/Program Manager, Nigerian Gas Flare Commercialization Programme (NGFCP), Justice O. Derefaka, (representing the Honorable Minister of State Petroleum Resources, His Excellency, Timipre Silva as keynote speaker); The Executive Governor of Edo State, Godwin Obaseki; National President of the Nigerian Environmental Society, Lawrence I. Ezemonye (FNES) Director, NOSDRA, Oladipo Obanewa at the ongoing 29th National Conference of the Nigerian Environmental Society (NES) with the theme: Narratives of the Nigerian Environment Needs - A Holistic Approach in Benin City, Edo State.

dustry, academia, service providers, communities, and other government agencies, MDAs and groups to create effective programs, services and initiatives that will demonstrate sound environmental stewardship and benefit our economy and our people. “Ladies and Gentlemen, collaboration is the name of the game in our quest for a holistic approach to our environment. History tells us that when we look for common solutions to existing challenges, we benefit from collective insights and wisdom. The Minister said that as a proof the government’s intention to collaborate can be seen in the gas sector where it has opened avenues for deep cooperation. Gas which is regarded as a cleaner fuel, is routinely flared in Nigeria and the government has created a programme to use this wasted resources. “To prove that the adoption of

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such approach is achievable, the Nigerian Gas Flare Commercialization Programme (NGFCP) in my office passed through that sieving funnel, hence the design of the NGFCP according to our development partners, is an innovative, robust and scalable approach to gas flare reduction - a “game changer” (first of a kind) consistent with the climate change action plans anticipated in the Paris Climate Change Accords which could be replicable in many other gas flaring countries around the World with Nigeria setting the pace,” Sylva said. Justice Derefaka, a gas industry professional seconded to the ministry of petroleum resources will continue to run the programme as well serve as Technical Adviser, gas business and policy implementation to help in driving the national gas policy. @Businessdayng

Cote d’Ivoire wants to become West Africa’s energy hub STEPHEN ONYEKWELU

ote d’Ivoire, the world’s largest producer and exporter of cocoa has ambitions to become West Africa’s energy hub, a leadership position Nigerian has been unable to retain. “On the part of the ministry in charge of petroleum and energy side, we want to capitalise on our geographic position and the quality of infrastructure to become the energy hub of the West African sub-region.” said Baptiste Aka, chief of staff at the Ministry of Petroleum, Energy & Renewable Energy, Côte d’Ivoireat the Africa Oil Week. “It is our plan that this position will cover all the value chain of the oil and gas industry from upstream exploration and production to downstream activities including the development of oil and gas infrastructures,” Aka said. Though Nigeria holds Africa’s largest oil reserves but poor fiscal and regulatory environment has kept away investors. Cote d’Ivoire seeks to fill this vacuum. The country used recently concluded Africa Oil Week to offer five oil blocks for investments. The three new blocks, CI-800, CI-801 and CI-802, along with existing blocks CI-102 and CI-503, benefit from shallow waters, good geological data and are adjacent to existing discoveries and the proximity of infrastructures. Although the bulk of the nation’s prospects are in the shallow water of fewer than 200 metres water depth, since 2011, 47 exploration licences have been granted by Côte d’Ivoire including four blocks in water depths exceeding 3000 metres. But Nigeria risks losing its natural dominant position as the subregion’s energy hub by its inability to put natural gas in the West African Gas Pipeline (WAGP). Already, countries along the sub-region’s shoreline have started seeking alternatives in liquefied natural gas to replace the WAGP, which has consistently performed below half its capacity. For instance, Benin Republic is seeking how to reverse a 750-megawatt shortfall and by building in dep en d ent p ow er plants, one of which is being developed by Enterprise Power, backed by the African Infrastructure Investment Managers (AIIM) which will use liquefied natural gas regasification to ensure supply reliability. In the spirit of Economic Community of West African States (ECOWAS), four West African countries, Benin, Ghana, Nigeria and Togo in February 2000, signed an Inter-Governmental Agreement to build a gas pipeline, which will supply Nigerian natural gas on West African markets. The WAGP was designed to pump 474 million cubic feet per day via a 20-inch diameter pipe with full compression but has never supplied even half of the contracted volumes, averaging less than 100 million cubic feet per day with throughput boosted only when Nigerian Independent Power Producers fail to pay producers that then switch gas for export if they can.

Tuesday 19 November 2019

BUSINESS DAY

ENERGY INTELLIGENCE Advocacy

NGA celebrates 20 years of impacting policy, driving gas investments in Nigeria ... Jackson Obaseki, others honoured at anniversary gala Stories by ISAAC ANYAOGU

he Nigerian Gas Association (NGA), a national, non-profit organisation promoting the progress of the gas industry says it will continue to deliver consistent and progressive advocacy drive as it celebrated its 20th anniversary. Over the last twenty years, the NGA, a chartered member of the International Gas Union (IGU), has influenced several industry-changing gas policies, viable gas projects and transnational deals thus reinforcing Natural Gas as one unique resource that Nigeria can leverage to create transformative change across various sectors and spheres of industry. The association is now largest gas-focused umbrella Association and voice of the Gas industry, the group said. “In its 20 years of existence the association has accomplished several notable feats in the natural gas industry. The NGA said some of its notable achievements include engaging the Nigerian Investment Promotion Commission (NIPC) over pioneer status and tax waivers for deserved members of its value chain, dramatic improvement in growth of the industry increasing natural gas exploration and protection, increase in local consumption/utilisation of natural gas, especially in derivatives manufacturing for Natural Gas Based Industries (NGBI), the increased volume of natural gas export and recognition of the Nigerian natural gas industry as a key market by local and international investors, increased Foreign Direct Investment (FDI) into the country and increased revenue generation. Founded in 1999 by a few industry giants at the time, such as the Nigerian National Petroleum Corpo-

ration (NNPC), the Shell Petroleum Development Company (SPDC), the Nigeria Liquefied Natural Gas Limited (NLNG), Chevron Nigeria Limited, the Nigerian Gas Company (NGC), Elf Petroleum(now Total E&P Nigeria Limited), Mobil Producing Nigeria, the Nigerian Agip Oil Company (NAOC) and Conoco Energy Nigeria Limited, the Nigerian Gas Association has evolved to a more diverse yet formidable body of over 124 corporate members and 2125 individual members working with a vision to improve the nation’s economy through the optimal maximization of its abounding Natural Gas reserves. “Natural Gas is that one singular resource Nigeria can leverage to create transformative change across various sectors and spheres of industry. As the NGA, we have worked resolutely over the past twenty years to foster a legal, regulatory and policy landscape for gas that is attractive to participants and investors, with the attendant multiplier benefits to the nation at large.” Mrs. Audrey Joe-Ezigbo President, Nigerian Gas Association.

“With over two decades of consistent and progressive advocacy drive, NGA has earned the pride of place as the flagship voice in the gas industry, worthy of celebration,” says Violin Antaih, publicity secretary, Nigerian Gas Association. Since inception, the Nigerian Gas Association has carried on its commitment to effectively champion the competitiveness and effective utilization of Natural Gas by promoting sound policy development, capacity development and best practices towards optimising the economics of the entire gas chain while emphasizing environmental protection and safety. At a landmark commemorative event which held at the Eko Convention Centre on Friday, November 1st, 2019, the industry’s most valued players and stakeholders gathered for an exclusive dinner and gala ceremony, while celebrating industry stakeholders and organisations with milestone awards for their decades of volunteering and support for the NGA, in its role as the voice of the Natural Gas industry. Among the high profile awards of the night was the conferment of a Life-

time Achievement Award on Jackson Gaius Obaseki, the Founding President of the Association, for his remarkable role in driving and implementing the vision of the NGA. Late Adeyemi Akinlawon received a Posthumous award for his exemplary service in various capacities to the association. Recipients under the corporate category include NLNG, Shell companies in Nigeria – Shell Nigeria Gas (SNG), Shell Exploration and Production Company Limited (SNEPCo) and the Shell Petroleum Development Company of Nigeria Limited (SPDC) - Axxela Limited, Anoh Gas Processing Company, Aiteo Group, Nigerian Gas Company (NGC), Falcon Corporation, Frontier Oil Limited, Clarke Energy, Energia Limited, Frontier Oil, The Nigerian National Petroleum Corporation (NNPC), Power Gas Africa Limited, Shoreline, Total E& P, WAGPCo, OilServ Limited, Seplat Petroleum Development Company, Honeywell Group, Oil and Gas Free Zones Authority Nigeria (OGFZA), Oando PLC, Nigerian Content Development and Monitoring Board (NCDMB). Gaius-Obaseki, Ibrahim Dahiru Waziri, Egbert Imomoh, Andrew Jamieson, Emmanuel Abayomi Olukoga, Engr. Chris Ogiemwonyi, Mr Charles Osezua, Engr. Chima Ibeneche, Engr. Saidu Mohammed, Mr Bolaji Osunsanya and Engr. Dada Thomas were all awarded for their Excellence in Leadership during their respective tenures as Presidents of the Nigerian Gas Association. Also awarded for Exemplary Stewardship were Aka Nwokedi, Ayorinde Adedoyin, Chindinma Obi, Emeka Ene, Ike Oguine, Nath Oyatogun, Shaba Hassan and Yetunde Taiwo who had all distinguished themselves in service, under the Association. Those who graced the occasion include the President of the Association; Mrs Audrey Joe-Ezigbo; the Lagos

State Governor, who represented by the Honourable Commissioner of Energy and Mineral Resources, Engr Olalere Odusote, Chief executives within the industry and prominent leaders from other sectors of the economy. Mrs Joe-Ezigbo elucidated the journey of the association and its significant growth over the decades. “It has been twenty years of impactful advocacy. Not without its challenges, but we have so much to celebrate. Today, the NGA has a very diverse membership made up of over 127 corporate organisations; drawn from the upstream, midstream and the downstream sectors of Nigeria’s oil and gas industry. Today NGA has over 2,000 professional members that include robust student representation”, she said. While commending the association for 20 years of notable influence in the Natural Gas Value Chain, Lere Odusote stated thus; “Lagos state has been opened and will continue to be opened for business. We will welcome the engagement with the sector; we will welcome suggestions, we will welcome ideas, participation and partnership.” According to recent statistics shared by the Nigerian National Petroleum Corporation research department, Nigeria’s proven Natural Gas reserve went up to 202 trillion cubic feet (tcf) from the initial figures in the past decades, steadily elevating the country’s capacity reserves to those of countries like Iran, Qatar, and Russia. Through its many corporate member organisations in Nigeria, NGA covers all aspects of the Nigerian gas industry. Continually promoting industry dialogue and information sharing on industry best practices and latest technological advances, the NGA has consistently organized biennial International Conferences and Exhibitions that position the organisation for continued impact and industry relevance.

Nigerian Liquefied Petroleum Gas Association Summit to deepen LPG adoption …Yemi Osinbajo, Tony Attah, Simbi Wabote, among list of confirmed as speakers

he forthcoming LPG Summit hosted by the Nigerian Liquefied Petroleum Gas Association (NLPGA) will provide platform for stakeholders and experts to discuss issues surrounding deepening LPG adoption on the continent and Nigeria’s Vice President, Yemi Osinbajo (SAN) has been confirmed as the Special Guest of Honour. In its 9th edition, the NLPGA Annual Conference & Exhibition of the Association billed to hold in partnership with Singapore’s LPG Summit on Tuesday, 26th and Wednesday, 27th of November 2019, at the Balmoral Hall of the Federal Palace Hotel, Lagos. Themed’ Harmonizing

Nuhu Yakuba

Yemi Osinbajo

Development and Growth in Nigeria and Africa’, the Nigeria LPG Summit 2019 will host stakeholders, experts, exhibitors from South East Asia, and the international gas community to an industry discourse on issues, developments, policies and innovations around LPG markets. Commenting on the

summit, the President, NLPGA, Nuhu Yakuba said. “Over the years, we advocated the adoption of LPG as an enabler of quality living for Nigerians and citizens across the continent. This year’s summit in partnership with Singapore’s LPG Summit will host the largest number of international delegates,

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critical stakeholders, experts and exhibitors in West Africa. The robust representation of participants promises to provide a crosscurrent of ideas and learnings from different markets and climes. Having the Vice President to join in these rich conversations further bolster the confidence that this will shape the policy environment on harnessing LPG opportunities for the benefits of our people,” Yakubu said. Neasa Hapiak, the director of LPG Summit, said: “Blessed with a vast gas resource, every stakeholder must seek innovative ways to harness the tremendous endowment of this very clean domestic fuel for use in Africa.

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“We have partnered with the Nigeria Liquefied Petroleum Gas Association (NLPGA) to host this world-class event that is not only gathering the brightest minds in the gas industry globally but also to collaborate to find solutions to the LPG challenges that are unique to the global markets. I look forward to welcoming participants to this event as I am confident of a very positive and impactful outcome,” Hapiak said. Other leading experts scheduled to speak at the Annual Conference & Exhibition include the Timipre Sylva, minister of state, Petroleum Resources; Tony Attah, managing director of the Nigeria LNG Limited; Executive Director, Com@Businessdayng

mercial Operations of Falcon Corporation Limited, Audrey Joe-Ezigbo; Executive Secretary, Nigerian Content Development and Monitoring Board, Simbi Kesiye Wabote; Others are Kalim Shah, chief information officer, Manufacturing, Sub-Saharan Africa, Agri-Business and Service Dept, International Finance Corporation, World Bank Group; M i c h a e l Ke l l y d e p u t y managing director, World LPG Association; Adeyemi Adetunji, chief operating officer, Downstream Nigerian National Petroleum Corporation, and Olumide Adeosun chief executive officer, Forte Oil Plc, , among several other local and international speakers.

Tuesday 19 November 2019

BUSINESS DAY

offgrid Business

Market

Africa needs additional solar PV deployment of 15 GW yearly to meet demands-IEA DIPO OLADEHINDE

o meet demand, African nations should add nearly 15 gigawatts of Photovoltaic (PV) each year through 2040 in order to become increasingly influential in shaping global energy trends as it undergoes the largest process of urbanization the world has ever seen, a report from the International Energy Agency (IEA) said. PV is a technology that converts sunlight (solar radiation) into direct current electricity by using semiconductors. Africa is home to abundant renewable energy resources and its renewable energy power potential is substantially larger than the current and projected power consumption of the continent. According to IEA, energy demand in Africa is expected to rise by 60percent by 2040 as a result of rapid population growth, with an

overall expansion of more than two billion people during the next two decades, of which 600 million will inhabit major cities. However, growth has been constrained, by limited access to financing, underdeveloped grids and infrastructure, unstable offtaker financial arrangements and, in many countries, an uncertain policy environment.

“Africa needs Solar PV deployment of almost 15 gigawatts (GW) a year between this year and 2040, an amount equivalent to the solar PV capacity the United States adds every year over the same period,” IEA said. IEA’s executive director Fatih Birol said Africa has a unique opportunity to pursue a much less carbonintensive development path than many other parts of the

world. “To achieve this, it has to take advantage of the huge potential that solar, wind, hydropower, natural gas and energy efficiency offers,” Birol said. IEA’s Africa Energy Outlook 2019 said the scale of deployment of non-hydro renewable is even more significant in the Africa case as a large part of this comes from solar PV, which over-

takes hydropower and natural gas to become the largest electricity source in Africa in terms of installed capacity and the second-largest in terms of generation output. IEA noted that Nigeria, South Africa, DR Congo and Ethiopia are among the countries with the highest investment needs, however, half of this investment is needed to expand and upgrade electricity networks including mini-grids and most of the rest is needed to increase low-carbon generation capacity where solar PV plays an important role. Despite this, recent advances in renewable energy technologies and accompanying cost reductions mean that the large-scale deployment of renewable energy now offers Africa a costeffective path to sustainable and equitable growth. In many parts of Africa, decentralised renewable energy technologies offer an economical solution for electrification in remote areas as well as for grid extension.

Another study undertaken by the International Renewable Energy Agency (IRENA) noted that Africa’s solar PV theoretical potential could provide the continent with more than 660 000 TWh of electricity a year, far above it’s projected needs. The IEA suggests that, with the right policies in place, Africa can become the first continent to develop its economy mainly through the use of modern energy sources, drawing on its “rich natural resources” to exploit clean, renewable technology in the form of solar, hydro and wind power. The new report is the IEA’s most comprehensive and detailed work to date on energy across the African continent, with a particular emphasis on sub-Saharan Africa. It includes detailed energy profiles of 11 countries that represent threequarters of the region’s gross domestic product and energy demand, including Nigeria, South Africa, Ethiopia, Kenya and Ghana.

Insight

Solar energy: the 8 ideas that will make panels more efficient and cheaper

hink solar energy is just about rows of flat silicon panels, sitting in a field collectingenergy? Think again. A new report from the International Renewable Energy Agency released this week explains how the sun looks set to shine on solar energy systems over the coming decades, with a wealth of advancements and dropping prices that could boost adoption. The paper makes for optimistic reading. Solar deployment alone could lead to a 21 percent reduction in total carbon dioxide emissions by 2050. The energy source could account for 25 percent of the world’s electricity needs by that point, second only to wind power, with 8,519 gigawatts of total installed capacity. This, combined with other efficiencies in buildings and transport, could lead to a 70 percent reduction in emissions from 2020 levels. That’s assuming society takes on a radical decarbonization plan, attuned to meeting targets outlined in the Paris Agreement and one that mixes clean energy with efficiency savings. But it’s not just flat panels harvesting light that could lead the way. Here’s some of the other ideas outlined in the report that could play a role. Solar trees

Solar trees would work similar to a real tree, in that “leaves” would collect light and use that as energy. The IRENA claims they use 100 times less space to produce the same amount of electricity. Advanced solar materials Beyond standard silicon, which commands around 95 percent of the market, researchers are exploring new materials. These could reduce prices and improve on silicon’s efficiency, which has achieved a maximum lab record of 26.7 percent. PERC cells, a relatively mature technology that adds a layer to the back of the cells to improve efficiency. Ta n d e m c e l l s. T h e s e

stack on top of each other to convert different bands of light into energy. These hold the world record for solar cell efficiency, nearly doubling that of solar to reach 46 percent efficiency! Unfortunately, they are very expensive and hard to manufacture. Thin-film cells. These can be cheaper but offer lower efficiency. They command around five percent of the market. Perovskites. These are made from minerals, easier to produce at low temperatures, and offer comparable efficiency to silicon at 24.2 percent. Large-scale production is difficult at this stage. Double-sided solar cells

These panels place cells on the reverse side as well. That captures reflected light from the other side, and could offer boosts between five and 20 percent more energy. They have been touted as a solution for sun-starved Scotland, where overcast skies make it an ideal use case. They command around five percent of the current market, but the International Technology Roadmap for Photovoltaic expects this to increase to 40 percent in the next 10 years. Half-cells This process would involve cutting a processed cell in half, which improves durability and can offer a boost of up to five watts. It has reached efficiencies up to 18 percent. This

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

accounted for less than three percent of the market in 2017, but could reach 10 percent next year. Solar roofs Adding solar panels to a home’s roof first entered the public imagination in 1979, when Jimmy Carter installed panels on the White House. Decades later, whole roofs are being made out of solar panels. Perhaps the most visible example is the Tesla Solar Roof, introduced in November 2016, which received a smattering of early installations in the spring of 2018. The company unveiled a thirdgeneration design in October 2019 and now expects to roll out to more states, pushing prices below the cost of a roof

plus solar panels. Floating solar Floating solar panels comprised 1.1 gigawatts of installed capacity in 2018, but that looks set to improve. South Korea is expected to build the world’s largest floating solar installation next year at 102.5 megawatts. A dairy farm in Rotterdam has even combined it with a dairy farm, creating a zero-emission floating installation. Thermal systems This would use the extra heat energy from solar panels, where a cooling agent is used to cool the panels and the newly-heated leftovers are used for other purposes. Researchers at SINTEF in Norway have produced a panel that uses water to cool the panels and creates a hot water byproduct. This allows users to capture the otherwise-wasted heat energy and also increase the efficiency of the panels. Agrophotovoltaics Placing solar panels above crops offers a more efficient use of land. Researchers at Oregon State University discovered that covering just one percent of the world’s farmland with solar would be enough to meet humanity’s energy needs. One airport in the Indian state of Kerala, which runs its entire operations from solar panels, also grew 60 tons of vegetables in 2018.

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

Tuesday 19 November 2019

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Monday 18 November 2019

Top Gainers/Losers as at Monday 18 November 2019 LOSERS

GAINERS Company

Company

Opening

Closing

Change

N28.6

N31

2.4

STANBIC

N38

N39

CUSTODIAN

N5.5

0.5

ETI

DANGSUGAR

N11.7

N11.95

0.25

UBA

N6.6

N6.75

0.15

CAVERTON

GUINNESS

UACN

Opening

Closing

Change

N52.95

N50

-2.95

N10.5

N9.8

-0.7

N7.5

-0.5

N7.4

N7.05

-0.35

N2.7

N2.5

-0.2

OKOMUOIL ACCESS

ASI (Points) DEALS (Numbers) VOLUME (Numbers)

26,691.09 4,609.00 307,961,462.00

VALUE (N billion) MARKET CAP (N Trn)

2.538

Stories by Iheanyi Nwachukwu

L-R: Josiah Choms, managing director, Caverton Helicopter Limited; Tony Ibeziako, head, Primary Markets/Listings Business Division, Nigerian Stock Exchange; Bode Makanjuola, chief executive officer, Caverton Offshore Support Group Plc; Rotimi Makanjuola, chief operating officer, Caverton Offshore Support Group Plc; Godstime Iwenekhai, head, Listings Regulation Department, NSE; and Amaka Obiora, company secretary, Caverton Offshore Support Group Plc, during the company’s Fact Behind the Figures/Closing Gong ceremony at the NSE in Lagos.

losers. UACN, Zenith Bank, UBA, Access Bank, and FBN Holdings were actively traded stocks. “In a market with T-bill rates below the level of inflation it is not surprising that investors look for alternatives : long-dated bonds and equities”, research

analysts at Coronation Merchant Bank said in their November 18 note. Okomu Oil Palm Plc recorded the highest loss after its share price declined from N52.95 to N50, losing N2.95 or 5.57percent, followed by Access Bank Plc which declined from N10.5

to N9.8, after losing 70kobo or 6.67percent. On the gainers table, Guinness Nigeria Plc advanced most, from N28.6 to N31, adding N2.4 or 8.39percent, while Stanbic IBTC Holdings Plc followed from N38 to N39, adding N1 or 2.63percent.

Caverton grows Q3 pre-tax profit by 50%, promises improved shareholders’ satisfaction

averton Offshore Support Group Plc, a leading aviation and marine services company, presented its facts behind the figures on Monday November 18, 2019 at the Nigerian Stock Exchange. The exercise was done to intimate the market of the company’s ongoing activities and future business projects. The Chief Financial Officer, Caverton Offshore, Titi Adigun while speaking during the company’s facts behind the figures at the event on Monday, said the company recorded a total increase of N2.6billion in its revenue for the nine month period ended September 30, 2019. She said the company’s revenue for the period stood

at N25.8billion, compared to the N23.3billion which was recorded in the same period of 2018. According to her, revenue growth was boosted by the increase of Helicopter/ Airplane contracts and agency service income. The company also grew its profit before tax for the period to N3.9billion from N2.6billion in 2018 despite a seven per cent increase in direct operating costs. She noted that the administration expenses also increased by N850million on the back of increased employee benefits of N735.5million and increase in salaries of ground staff. The Chief Executive Officer, Caverton Offshore, Bode Makanjuola, said, “We are determined to end 2019 on a www.businessday.ng

strong note by continuing to provide the quality of service our clients have become accustomed to. “Our clients are our topmost priority and our performance reflects this commitment, which hopefully translates into positive financial returns for our shareholders.” Makanjuola stated that the company was committed to improving cost efficiencies with scope for enhanced performance. He added that the company was able to improve on its cost to income ratio and operating expenses despite the inflationary environment and maintained a stable capital adequacy ratio, which balanced the support for growth initiatives. According to him, with a

positive outlook for the global Gross Domestic Product, t ra d e a n d o i l d e m a n d , Caverton Offshore Support Group is well positioned to extend its service value as a leading provider of marine and aviation logistics to major crude oil exporters. Ma ka nju ola sa i d t h e company’s direct involvement in the crude oil production value chain through service provision offered the advantage of unique market access to optimise its business capabilities. He noted that with the significant volumes, and in collaboration with capable technical partners in the crude oil transport business, he believed that the company was well positioned to thrive and grow in the sector.

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FTSE 100 Index 7,307.70GBP +4.76+0.07%

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Shanghai Stock Exchange Composite Index 2,909.20CNY +17.86+0.62%

12.882

Stock market loses N189bn as investors take profit after recent rally igeria’s equities m a r k e t lost about N189billion on Monday November 18, 2019 as many investors rushed to Custom Street to take profit on stocks after last week’s rally which had lifted stocks value up by N300billion. The Nigerian Stock Exchange (NSE) All Share Index (ASI) depreciated by 0.60percent to close at 26,691.09 points as against 26,851.68 points recorded previously. Its Year-to-Date ( YtD) returns currently stands at -15.08percent. The value of listed equities decreased from N13.071 trillion to N12.882trillion. I n 4 , 6 0 9 d e a l s, e q u i t y investors exchanged 307,961,462 units valued at N2.538billion. The market recorded the huge loss despite that 22 stocks gained as against 11

Global market indicators

Brown appointed CEO designate of Seplat as Austin retires in July 2020

eplat Petroleum Development Company Plc on Monday November 18, 2019 announced that her pioneer Managing Director and later CEO, Austin Avuru will be retiring in July 2020 after 10 years of leading the company. In these 10 years, Avuru led the development of a strong organization, the deployment of agile systems, processes and stakeholder relationships that allowed the organization to grow rapidly from a gross production of 22,700boepd as at December 2010 to peaks of 111,368boepd gross production as at December 2018 through major drilling campaigns and major new Oil and Gas plants development. The acquisition of 40percent of OML 53, post Company’s IPO of 2014, created an opportunity in partnership with NNPC, to spawn a mid-stream subsidiar y, ANOH Gas Processing Company Ltd currently progressing what will ultimately be a 3 0 0 M Ms c f / d o f Ga s, 22,500bdp of condensate and 1,200boepd of LPG processing Company. All these could not have been achieved without Avuru’s leadership skills, personal dedication and hard work, at the head of the Company. The Board of SEPLAT is grateful to Avuru for these accomplishments and is looking forward to his continued service at the Board level.

Roger Brown, CEO designate, Seplat @Businessdayng

Looking forward, Seplat plans to position itself for a next phase growth ambition which would see the expansion of its footprint in terms of energy business activities, a plan to pursue offshore assets as well as opportunity driven entry into different geographies. The Company believes t h a t s u c h a c o r p o ra t e transition would require a different kind of organizational structure, people skills set and mentality to compete well in the expanded space. In view of this, Seplat will be reviewing its current organizational and systems structure. To lead the Company in her latest aspirations, the Board has selected Mr. Roger Brown as the successor to Avuru as CEO, when Avuru steps down on 31 July 2020. The Board also decided that the CEO designate will lead the restructuring during the Transition period between now and final exit date of Avuru on 31 July 2020. Brown joined SEPLAT in 2013 as the CFO and played a key role in the successful dual listing of the Company in 2014. Similarly, since joining the Company, he has played significant roles in various asset acquisitions by the Company. Brown brings to the CEO role, a deep knowledge of the Company in his 6 years as the CFO and a member of the Board. He has strong financial, commercial and M&A experience as well as proven people skills which will be an asset as the Company embarks on the next phase of its growth plan. Prior to joining SEPLAT, Brown was an advisor to the Company since 2010 while he was the Managing Director and head of EMEA Oil and Gas at Standard Bank Group. During his time at the bank, he was instrumental in providing advice and deploying capital across the African continent in the Oil & Gas, Power & Infrastructure and the renewable energy sectors.

Tuesday 19 November 2019

BUSINESS DAY

POLITICS & POLICY

We are lucky in Taraba to have Darius Ishaku as governor - Mamman John Mamman is an elder statesman and chairman Taraba State Civil Service Commission. In this exclusive interview with our Correspondent NATHANIEL GBAORON in Jalingo, he spoke on the lingering Jukun/Tiv crisis and other issues. Excerpts: Despite the security and financial challenges confronting the state, the state government still boasts of some modest achievements. As an insider, can you give us insight into what the government has done? es, the government can really beat its chest and say it has done very well. Because despite the economic challenges and crises in the state, this government has achieved something and this is because of the prudence of the governor who is a technocrat. He has been able to balance the needful and what he considers very important for the state. He is a good planner and you know if you don’t plan very well you cannot achieve anything. This governor is not just an architect, he is also a planner and he has developed a scheme whereby he can balance things that are necessary and cast out those that are not necessary for the development of the state. Some of the basic things are payment of salaries and pension which are done regularly unlike most states in the country that are not able to pay salaries. And with the meagre resources that is left after the payment of salaries, pensions and management of crisis and other challenges he has been able to channel these resources to development projects. Now, we can boast of good water supply; he has been able to stabilise water in Jalingo and most of the urban centres in the state. Most of the rural areas now boast of boreholes and people are no longer complaining of water-related diseases and that has reduced rate of diseases in the state. In the area of road construction; three roads are going on now. We have the Pantisawa road in Yorro Local Government, the Mararaba Baissa road is ongoing and the Wukari– Tsokundi road in Wukari is equally going on. The one in Wukari suffered a small set back because of the crisis

pline and areas we need people and we will employ them. It is very necessary we do this otherwise we will wake up one day and discover that we have only pensioners left because many of them must have retired.

John Mamman

there. In education he took the school from less than 30 percent to 70 percent, we are about the highest in the north and 4th in the country. So, I think we in Taraba can boast and say our governor has done very well. One of the problems this administration inherited was ineffective civil service; now that you have been made the chairman of the state civil service commission, what reforms do you intend to bring to reposition the service? This is very difficult area, because you don’t change people overnight and you don’t teach an old dog new tricks, but what we are trying to do here is to restore some sanity in the civil service. We want to see that there is sanity and discipline in the service, people must learn to do their work diligently. Secondly, we will focus on training and retraining of civil servants so that they will understand their duties, this is our hope. We want to also see that people earn and merit their promotions. Very soon, we are going to introduce a system where www.businessday.ng

before you are confirmed, you must pass confirmation examination and before you get promoted you must pass promotion examination as is done in the federal service. These are the things we are trying to do so that people will sit up and know the rudiments of their duties before they get promoted to higher responsibilities. There seems to be a gap in the junior and medium cadre of the state civil service; how do you intend to address this issue? Yes, the governor has actually noticed that. There is gap in the junior and the

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middle cadre. Even at the top level of civil service, there is gap because the most of the experienced civil servants we inherited from old Adamawa State are retiring, the experienced ones are going and in two or three years most of the civil servants that came from Adamawa at the creation of Taraba will be going, so he has graciously approved that we should employ over 300 people which we are about to start. We have already interviewed some people since 2017, we brush over the exercise and get people whose services are needed based on their disci-

We must reform our thinking and re-orientate our worldviews about humanity. We must first accept that we are human beings capable of making mistakes https://www.facebook.com/businessdayng

Sir, the Tiv/Jukun crisis has lingered for so long, as an elder and somebody from that area, what do you think can be done to bring a lasting solution to the crisis? You see, the issue between the Jukun and the Tiv is an old story and they lived among themselves for long. In fact, we grew up and met them there and I think it will be difficult for us to say we can find a solution that can separate the Tiv from the Jukun; that is not workable. The only thing now is to learn how to live together amicably, tolerate one another and be able to respect one another. The issue here is that we allow politics to come and interfere with things that actually don’t have political bearing. Like the issue that sparked crisis in Kente in Wukari Local Government; under normal circumstances these are two people who had misunderstanding and it became something else. If you ask people who are fighting now what the actual genesis of the crisis is, they will not know. You see, in life there are three classes of people; we have those who are called the ‘Idiots’. The idiots are people who do not concern themselves with politics or anything other than themselves. The second category of people are called ‘tribesmen’. These are people who are concerned with their tribes. Anything that has to do with their tribes they are ready to die for it; whether they know what is happening or not provided their tribesman is involved they go for the defense of their tribe. The last group of people are called ‘citizens’. These are people who reason and think beyond their tribe. They are concerned with what is happening in the world. What is happening in southern Taraba is that most @Businessdayng

people there fall in the second category of ‘tribesmen.’ You come and see a Tiv man fighting a Jukun man and you don’t ask ‘what did the Jukun man do to you?’ you just join the fight and when you are asked later what did the Jukun man do? He will say that the other person should explain, and vice versa. We have allowed ourselves to fall into this stupid clannish category of people. We must resist the temptation of being tribesmen, other than citizens and this is not only applied to Jukun and Tiv, but across Nigeria. A Fulani man who takes his cows to your farm, when his fellow Fulani man comes he will not ask why do you take your cows to the farm? He will just join him in fighting the farmer. Similarly, when a farmer is fighting a herder and his fellow farmer comes around, he joins the farmer to fight the herder. This is the mentality that we in Nigeria have evolved and we must avoid this. As long term measure we must try and cleanse ourselves with this tribesman mentality. We must reform our thinking and re-orientate our worldviews about humanity. We must first accept that we are human beings capable of making mistakes. We must start thinking as citizens and as citizens we must be responsible to everybody’s behaviour. As it is now, the only way is for us to start thinking as citizens otherwise there is no solution as long as we remain tribesmen, the fight will continue. What more should the people of Taraba expect from this government? The governor has always said, ‘Give me peace and I will give you development’. So, if there is peace, this government will do more, provided we don’t keep spending money to keep soldiers, support police and hunters to go after kidnappers. So, the people of Taraba should expect meaningful development provided we are not spending money only on maintaining peace.

Tuesday 19 November 2019

BUSINESS DAY

interview

With $35m investment in flagship facility, Cummins is positioned for leadership in Nigeria - Pimi Cummins West Africa Ltd, the Nigerian outlet of the global manufacturer of engines, filtration, and power generation products, recently launched a multi-million dollar facility, marking 100 years of its parent company’s operations globally. The investment shows long-term commitment to Nigeria and a move for market leadership in Nigeria, says Thierry Pimi, Cummins’ Africa & Middle East Executive MD, in this interview with SEGUN ADAMS. As you mark a century of operation globally, could you talk about the significance of this moment? t is pivotal; it is a great moment for us as a company and for our employees here in Nigeria. Our 100-year celebration is about our employees, they are the ones that carried us for a century through their dedication, hard work, innovation, and living our values. We are celebrating our employees, and ensuring that Cummins is geared up for our century, and ready to challenge the impossible over the next decade. In Africa, Nigeria is the single biggest market for our competition, and winning on the continent would be impossible without Nigeria. We have been here in different forms over the years but as a 100 percent-owned Cummins entity, we have been here since 2015 and we are stepping with the launch of our state-of-the-art $35million flagship facility. This investment is our strongest signal to the marketplace, our employees and the business community that we have taken a long-term approach to Nigeria.

time to be involved in voluntary activity in the community.

How has the journey in Nigeria been so far? It is been an exciting journey. Nigeria is a very competitive market and is the single largest. Here in Nigeria, we used to have independent dealers importing our goods and selling them, and then we came as a Joint Venture, partnering with A.G.Leventis which was our first direct footprint in Nigeria. The JV lasted about six to eight years, and then we decided to move forward differently and bought A.G.Leventis’ stake in the JV. In this journey, we have had to basically build the Cummins culture and bring processes here, and today we intend to lead. Today we are offering products that are more specific to the Nigerian market and that would land in Nigeria at a more competitive price. We are also equipping our Nigerian team with all the tools in terms of commercial, technical and leadership abilities. Does Cummins have local partnerships in Nigeria? A generator set is an accumulation of several parts and sub-components, and in places where we have built massive manufacturing and

Thierry Pimi

assembly capabilities, we needed to develop a critical supply base; people who can provide the canopies for generators, mufflers, bolts and the different components. Because we are a premium product we have a guaranteed standard of quality our customers expect from us. We needed to make sure we guaranteed that quality through our supply base, and that was the critical first step to enable us to assemble in Nigeria. That is one avenue of partnership, the other is to expand our footprint around the country in terms of sales point-we do not need every sales point to be a Cummins-owned outlet, we could also have service, sales dealers and vendors to occupy certain territories. Asides engines, filtration, and power generation products, Cummins plays in the marine space. Could you talk briefly on the re-launch of your marine business? After power generation, marine business is our single biggest opportunity in Nigeria for many reasons; from the oil and gas activities in some states in South-eastern Nigeria to the trade and logistics routes that lead to Nigeria which is a big economy with major seaports www.businessday.ng

and a high volume of commercial activities. A lot of the big boats are powered with engines from Cummins and we can remake those engines and offer critical interventions in the engines. Our branch in Port Harcourt is essentially focused on that business but we are developing that capability in Lagos as well. In terms of employment and social impact, how much is Cummins felt in the communities you operate here in Nigeria? Cummins has so far invested $350,000 on corporate responsibility initiatives. In fact, for us giving back to the communities is one of the strategic goals of Cummins in this part of the world; just as important for us as becoming a leader in the market that we play in, diversity and inclusion, and unleashing the right continental talents. So giving back to the community is not a “give-to-have”, it is not something we do after we have made a profit but it is something we do just as we pursue leadership in the domestic market. At every site where we have more than 20 employees, we have a local community involvement team that scans the community to identify needs. In Cummins, every employee spends four years of company

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You have talked about opportunities in the Nigerian market along with your plans to position for leadership, but what challenges have you encountered and how do you think they can be addressed? The challenges are many just like in many markets of similar size as Nigeria. Wherever you see big opportunities there will be big challenges too, but for us, the way we approach it is through our values. Cummins is a company of strong value; we have five core values that are our compass and it is not difficult for a Cummins leader to make decisions, whether it is walking away from a business opportunity, because of corruption involved, or taking a long-term view and contributing to improve the community through caring or bringing innovation to the market to help our customers meet their goal. Engines and generator products are highly technical products so we need qualified technicians but most of the time we do not find people here who are properly trained to immediately take up technical jobs, even among the graduates. We have had to invest in retraining them which sometimes take years, at the end which some of the trainees leave the company for competitors or other places. That is a challenge but we feel it is okay that we contribute to building those capabilities locally. The other one commonly referred to is corruption, but I would like to insist it is not an issue specific to Nigeria but in many other markets-not just emerging markets. Since Nigeria exited recession, growth has not been very impressive and this is affecting the profitability of some businesses. Are Cummins’ sales also affected? Yes, definitely. As you know we do a lot of business-to-business (B2B), a lot of our customers, if they are going through a difficult time, would naturally reduce or renewed their orders from us. For instance, a company that would have replaced their generator may delay it for one more year. We are feeling the impact of sluggish economic growth. Our business by nature is cyclical, not just in generators but what we do is to make sure we manage @Businessdayng

the business smartly, we make the right decisions however difficult so that after economic recession cycles we emerge stronger. We know the market will rise again; we just need to do the right thing so when the slow-growth cycle is over we emerge in a good position to compete and win. Could you speak to gender inclusivity and representation in your company? I would love to know what percentage of your workforce is female. Overall today, we have around 27 percent, our goal is to be about 35 percent by 2021. It has not been easy and that is why we made it front and centre especially gender inclusion in our area of business operation which is African and the Middle East. As you know, the diesel or generator industry in our region is not one female just starting their career would naturally think because culturally it is thought of as for male folks. That said as I mentioned Cummins is 62,000 employees there is no single job at our organisation that a woman cannot do because of gender barrier; whether it is being CEO, a technician, design engineer, application engineer, finance or human resources leader, every single job can be done by a woman. It would interest you to know our plant manager here in Nigeria is a female. What are the emerging trends in the energy space and how are you adapting. Also, what is the next phase for Cummins in Nigeria? The trend is that there will probably be a move towards gas generation and towards 2 to 10 megawatts power plants in the country as opposed to having generators in every household or having a massive 400-megawatt plant. Just this year, we launched a new product the HSK78, which is the most efficient product in its range and is about 2,500-kilo watts. As different countries transition towards alternative fuel- we believe from diesel there would be a move towards gas and on a longer-term there would be solar and other elements in the energy mix- internal combustion engines are still going to have a role to play in our part of the world for a foreseeable future maybe more towards gas and more hybrid solution and distributed generation.

Tuesday 19 November 2019

BUSINESS DAY

news

Court stops Mastercard from producing Nigerian National Identity cards …as Chams, CCL seek N114bn damages

Jumoke Akiyode-Lawanson

Federal High Court in Abuja has stopped MasterCard and her agents from issuing the Nigerian National Identity card, following an ex parte motion filed by Chams Plc and Chams Consortium Limited (CCL) on August 28, 2019. The motion, which also includes an Anton Pillar order, was issued on November 7, 2019. In their Statement of Claim, the companies are asking Mastercard to pay the sum of N114 billion for damages. Recall that in 2006, Chams was invited by the Federal Government to bid for the National ID project. It competed and emerged as the preferred bidder for the Nigeria National Identity Card (NIC) concession. Before and upon the execution of a concession agreement with the National Identity Management Commission (NIMC), Chams Plc pursued the implementation of the NIC concession by incorporating ChamsConsortium Limited (CCL), a Special Purpose Vehicle (SPV) with the sole purpose of implementing the NIC concession. Chams Plc also invited MasterCard to work with the ChamsConsortium as one of its technical partners on the NIC concession. “Surprisingly and to the disappointment of Chams and other stakeholders, MasterCard went on to collude with others using technical information and design shared with them by Chams to frustrate the concession won by Chams and the more than US$100million Chams/CCL invested in the project,” the Chams said in a statement. Justice R.M. Aikawa ruled: “An order of interim injunction restraining the defendants, whether acting by themselves or by their directors, officers, servants, agents, technical managers, or otherwise however from further manufacturing, producing, designing and or printing or authorizing the manufacturing, production, designing and or printing of any National Identity Card with MasterCard logo as described in paragraph 16 of the supporting affidavit in Exhibit CC9 pending the determination of the motion on notice filed”. Other defendants in the case include Ajay Banga, President and Chief Executive, Mastercard international, Omokehinde Ojomuyide, Country Representative of Mastercard in Nigeria, Daniel Monehin, the staff of Mastercard, the National Identity Management Commission (NIMC), and 22 commercial banks as respondents. Similar order was given to 22 respondent banks in Nigeria restraining them from honouring or giving effect to any transaction from Mastercard. The Anton Pillar Order has empowered the prosecuting solicitor, Kemi Pinheiro SAN of Pinheiro LP, Inspector General of Police (IG) or any senior police officer not below the rank of Assistant Superintendent of Police to search any of their premises, take into possession and remove any document relating to the said affidavit.

Kogi Guber: I will go to court, says PDP’s Wada Solomon Ayado he candidate of the People’s Democratic Party (PDP) in the Kogi Governorship Election, Musa Wada, on Monday said he would petition against the result of the election in which the Independent National Electoral Commission (INEC) announced Yahayah Bello as winner. Wada, who described the outcome of the election as a sham, said it was marred by violence and irregularities, and that there was over-voting in some areas while the votes of the genuine voters were not

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counted in other areas. Briefing newsmen in Abuja, Wada, said it was clear that there was no election on Saturday, November 16th 2019, but a declaration and execution of war against the people. “Of course I will go to court to petition the outcome of the election. It was a sham. What happened in Kogi was an organised war against democracy; coup against the people and seizure of power through brigandage and the barrel of the gun with members of the Police and other security agencies coordinating the stealing of the people’s votes.

“The Police aided armed APC thugs to invade polling units with impunity, shoot and kill voters and carted away ballot boxes to government facilities where results were written in favour of APC and handed over to INEC to announce against the will of the people. “Police helicopters were used to attack polling units, fire tear gas on voters and provide cover to APC hoodlums and policemen who brutalised the people of Kogi state and stole their mandate. “The APC turned our state into a theatre of war. No fewer than nine innocent Nigerians

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were killed. Many more were maimed and injured by the APC in their desperation to seize power at all cost,” Wada said. Describing as shameful the declaration by INEC, Wada stated that the results were fabricated despite the glaring disruptions that characterized the shambolic exercise. He revealed that INEC cancelled PDP’s votes in areas of our stronghold, subtracted from it votes in many other areas and padded the votes of APC to give a semblance of victory to the party. Saying the people of Kogi were horrified, brutalised and

@Businessdayng

dehumanized, Wada further stated that there have been weeping across the state since the announcement of another four years of Yahaya Bello. “We therefore stand with the people of Kogi to state without equivocation that this brigandage and stealing of our mandate cannot stand. “We will never despair but remain strong in our determination to retrieve the mandate freely given to us by the people in their desire for a change. We will pursue this course to its logical conclusion within the confines of the law of this country.

Tuesday 19 November 2019

BUSINESS DAY

news Nigeria’s inflation rises the most in 17 months... Continued from page 1

remain supply shocks with underlying cost push pressures,” the Economic Think Tank at Financial Derivatives Company (FDC) said in a recent economic bulletin sent to clients. “The impact of the border closure was further exacerbated by unusual heavy rainfall in October, which had a negative impact on harvest.” The food subindex, which accounts for more than half of the inflation basket, increased by 14.09 percent on a year-on-year basis in October from 13.51 percent recorded in the previous month, while the index that measures inflation of all items excluding farm produce – core inflation – decelerated by 8.88 percent in the review month driven by sustained stability in foreign exchange rate and fuel prices. Nigeria recently closed its land borders against importation and exportation of goods to the end of January 2020 in a bid to curtail smuggling of rice and other commodities, a move that has cut the supply of essential food items for a country that relies on importation to meet its rising demand. “The closure of the borders was met with considerable apprehension,” the FDC Economic Think Tank said. That “resulted in shortages of smuggled commodities especially rice, turkey, chicken, and baking margarine”. Domestic demand for rice – one of Nigeria’s major staple foods which accounts for about 9 percent of the country’s inflation basket – began to outstrip local production in the late 1970s, according to geopolitical and socio-economic research firm, SBM Intelligence. While the trend was reversed in the late 1980s, domestic demand for rice continued to surpass supply despite appreciable growth in domestic production, no thanks to Nigeria’s rising annual population growth rate estimated at

2.6 percent. “The issue with rice in Nigeria is not that domestic production has not grown,” SBM said. “It is simply that domestic consumption has continued to outgrow it. What is needed is to improve productivity and build the infrastructure to reduce wastage and cost to consumers.” According to KPMG, a global professional services company, only about 57 percent of the 6.7 million metric tonnes of rice consumed in the country annually is locally produced, leading to a supply deficit of about 3 million metric tonnes. These supply gaps, which were bridged through illegal importation of the commodity, are gradually resurfacing following the government’s decision to completely restrict trade across its land borders, pushing food prices across the major food classes, such as bread and cereals, fish, meat, potatoes, yam and other tubers, vegetables, as well as oils and fats in September, according to NBS. T h e u r b a n y e a r- o n year inflation rate stood at 12.20 percent in October 2019 from 11.78 percent recorded in September 2019, while the rural inflation rate was recorded at 11.07 percent in October 2019 from 10.77 percent in September 2019. Inflation was highest in Kebbi, Bauchi, and Ondo States which recorded average price increases of 15.20 percent, 13.97 percent and 13.74 percent, respectively. On the flipside, Kwara, Katsina and Bayelsa were states with the lowest inflation figures with corresponding increases of 9.69 percent, 9.29 percent, and 9.07 percent for the review month. Meanwhile, analysts at United Capital have forecast continuous upticks in inflation rate in coming months as the festive season draws nearer, and on continued closure of the border in November.

•Continues online at www.businessday.ng

L-R: Bill Gates, co-chairman, The Bill & Melinda Gates Foundation; Babajide Sanwo-Olu, governor, Lagos State, and Aliko Dangote, president, Dangote Foundation, at a roundtable discussion with the Bill and Melinda Gates Foundation on healthcare interventions in Nigeria, held in Seattle, the United States.

Rice farmers, millers ramp up production as Nigerians... Continued from page 1

dent, Rice Farmers Association of Nigeria, told BusinessDay in a telephone response to questions. “This is because millers are patronising rice farmers now and off-taking all that the farmers produce immediately.” Goronyo said that before the border closure, farmers were holding over 20,000 tons of paddy which lay fallow because millers were not buying from them. The Federal Government had on August 21 closed the country’s land borders in an attempt to tackle smuggling, especially of rice. The move created scarcity of the commodity in the markets across the country, forcing prices to skyrocket to as high as average of N24,000 for a 50kg bag of local rice. But the move also compelled Nigerians, who generally have a high preference for foreign varieties, to shift to local brands. The border closure also brought comfort to local poultry and tomato farmers who struggled for years fighting off smuggled alternatives. BusinessDay’s survey at Daleko market, the biggest rice market in Lagos, shows that local brands now dominate traders’ shelves with prices declining when

compared to a month ago. A 50kg bag of local brands from integrated rice millers such as Mama Pride, Umza Classic, Mama Choice, Lake Rice, Three Brothers, AlHamsad, among others now sells for average of N19,500 as against N24,000 sold a month ago, indicating a 19 percent drop in prices. Similarly, a 50kg bag of rice from semi-integrated millers and manual millers sells for between N14,000 and N15,000. These varieties are regarded as lower quality with stones mixed with the rice grains and were not stocked by traders before now. “Yes, the prices of rice went up immediately after the border closure. The prices have peaked and are now coming down,” Mohammed Abubakar, chairman of the near 40-member Integrated Rice Processors Association of Nigeria, told BusinessDay. “We would be able to meet demand and Nigerians have no need to worry about Christmas demand. Our members are already increasing their capacity,” Abubakar said. He noted that the association currently has 35 members with a milling capacity of about 2.1 million metric tons, while non-

members have an estimated milling capacity of about 3 million MT. Estimates now put Nigeria’s aggregate rice milling capacity at around 5.1 million MT per annum, which is expected to further increase as Dangote Group looks to commence production soon. The fall in prices is a measure of success of government policies, said a senior government official who applauded the shift to local rice by Nigerians. The government official also acknowledged that the borders cannot remain shut for ever. The United States Department of Agriculture (USDA) puts Nigeria’s milled rice 2018/2019 production at 4.78 million MT, up over 2.5 percent from 2017/18 figure of 4.66 million MT. The Food and Agricultural Organisation (FAO) had in 2017 attributed the continuous growth recorded in the country’s rice production to high local prices and inputs assistance programmes such as the Anchor Borrowers Programme. However, the 4.7 million MT milled rice in 2018 is still 2.3 million MT below Nigeria’s 7 million MT annual demand as stated by the country’s Ministry of Agriculture and Rural De-

velopment. “Si n ce th e su rg e i n prices, farmers who have abandoned growing rice have returned and even other farmers are shifting to rice cultivation because the market is there,” Muhammed Augie, chairman, Rice Farmers Association, Kebbi chapter, said. “A bag of paddy rice now costs N8,500 as against N10,000 sold two weeks ago. This is because we are growing more and the harvesting season just commenced,” Augie said. But exp er ts say the country can only sustain the progress made thus far when prices of local brands become competitive and lingering structural problems such as insufficient supply chain integration, lack of capacity for farmers and infrastructural deficit which remains a threat to local production are addressed. “The prices of local varieties have to reduce further. Before the border closure, imported brands were selling for N13,500 even after paying tariffs, bribing the Customs and transportation,” said an expert who spoke on condition of anonymity. “The government needs to provide key infrastructure to drive down production cost as well as ensure that farmers’ yield per hectare increases,” the person said.

Nigerian universities lose more students to US schools’...

Kogi/Bayelsa guber: Large-scale violence re-echoes...

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sell to students. The average cost per session for Social and Management Science courses in private Nigerian universities is about N500,000 and over N1 million for Medicine. Federal and state governmentowned universities pay less than N50,000 per session in tuition, which partly accounts for the poor quality of education in these universities. Employers of labour also tend to prefer foreign degrees for their perceived value.

“There are state universities and there are private universities. If you want to send your child to Harvard University, you will pay heavily but you also have better chances of acquiring quality education and brighter job prospects,” Tunji Oyebanji, managing director, 11 plc, said in an interview with BusinessDay. Globally, Nigeria moved up by two places, ranking 11th position from its previous ranking of 13th among the countries with the highest number of www.businessday.ng

students in America, while China, India, South Korea, Saudi Arabia and Canada are the top five countries, according to the report. “The education sector is facing the problem of incompetent teachers and unserious students. It is also facing the problem of dilapidated infrastructure,” Peter Okebukola, former executive secretary, National Universities Commission, said.

•Continues online at www.businessday.ng

to amend the constitution for that. Let the governors take the remaining period when they win at the tribunal or court, rather than bothering the voters again and giving way for all these crises,” he said. Recently, former President Goodluck Jonathan said the only way to salvage the nation’s democracy was for the National Assembly to the review existing law for the country to compulsorily embrace elec-

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tronic voting. “We must come up with new standards for constituting our election management body in a way that people will have confidence. I believe in some quarters what they do is that a body of people constitute the Election Management Body. It is not in the hands of one person,” he said. Balarabe Musa, Second Republic governor of Kaduna State, said the country must take punitive measures to check the increasing trend of @Businessdayng

electoral violence to save the nation’s democracy. “We have to punish anybody who is seen to be instigating violence and stop them from contesting it; because we are tolerating them, that is why all this is happening. If we are serious about free and fair elections in Nigeria it must be checked. Look at what happened in Kogi and Bayelsa; it is a shame to this country,” he said.

•Continues online at www.businessday.ng

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World Business Newspaper Kana Inagaki

oftBank-backed Yahoo Japan and messaging app Line have agreed to merge as Masayoshi Son seeks to create a south-east Asian powerhouse in data and artificial intelligence worth ¥3.3tn ($30bn). The deal follows a long courtship of Line by Mr Son, SoftBank’s founder, who has long pitched the merger as a way to compete against bigger groups in China and Silicon Valley, according to people familiar with the discussions. The merger, which is expected to be completed in October 2020, values Line at ¥1.3tn, creating a group with a combined market value of ¥3.3tn. The group’s $11bn in combined revenue would put it above domestic rival Rakuten with access to a growing number of mobile users in south-east Asia. Analysts have often called for the two groups to combine, saying a deal would give Line and Yahoo Japan access to a bigger pool of data and stronger negotiating power with its advertisers. It also strengthens Yahoo Japan’s presence in the mobile space by giving it access to Line’s 164m monthly active users in Japan, Taiwan, Thailand and Indonesia. For WhatsApp rival Line, the merger allows it to join SoftBank’s ecosystem and benefit from its investment in AI and other technologies through the $100bn Vision Fund. “We were driven by a sense of crisis about global competition and the pace of change in AI,” Takeshi

SoftBank signs $30bn deal between Yahoo Japan and Line

Tie-up aimed at creating a south-east Asia powerhouse in data and AI

Idezawa, co-chief executive at Line, said at a joint press conference in Tokyo. “The timing arrived for us to move on to the next phase [with this merger].” Following news of the deal, CLSA raised its target price on Line to ¥7,500 from ¥5,000, saying the combination made “perfect sense”.

State-owned oil company will confine marketing of shares to the kingdom and Gulf states

Terms softened in effort to entice interest in upscale residential apartments

ew York developers have taken the rare step of easing down payments for residential properties to entice buyers in a sluggish market. The hard-and-fast rule for those hoping to own a New York City apartment was that they must come up with 20 per cent of the purchase price in cash, a formidable barrier to entry even for deep-pocketed residents. Yet in an attempt to prod buyers in what has been a moribund market, several developers have begun to show more flexibility by either accepting smaller down payments or staggering them. One such developer is Los Angeles-based CIM, which is allowing buyers to pay 5 per cent when they sign sales contracts at two new Brooklyn projects it is marketing: Front & York in the Dumbo neighbourhood, and 111 Montgomery in Crown Heights. Another 5 per cent payment is not due until several months later. “We saw it as one way to bring buyers into the sales gallery,” said Jason Schreiber, principal at CIM. “I don’t think anyone denies the market has been relatively slow.” Mr Schreiber’s characterisation

may be an understatement: According to Core, a New York City brokerage, median prices in the city fell 12 per cent from the same period a year earlier to $999,950. It was the worst quarterly fall since the last three months of 2009, in the depths of the financial crisis. The number of sales has also plummeted. “Scary,” is how one developer described the luxury market, particularly along the so-called “billionaires row” of new super-tall buildings on 57th street, overlooking Central Park. The chilling effect on the high end of the market came as foreign buyers retreated at the same time as New York City introduced a “mansion tax”, intended to fund the renovation of the subway system. The new surcharge came into effect in July with a one-off tax starting at 1.25 per cent on homes worth more than $2m, rising to 3.9 per cent on those sold for more than $25m. The challenge, say property executives, is that prospective buyers are well aware that the leverage has shifted in their favour. Unless they must move urgently, many see no reason to strike a deal as long as supply is plentiful and there is a possibility that prices may fall further still. www.businessday.ng

from revenue, market value and research budget. Makoto Kikuchi, chief investment officer at Myojo Asset Management, said: “Line can’t compete alone in this space. There is really no other option.” Under the framework announced on Monday, Line will first be taken

Saudi Aramco abandons international roadshow for IPO

NY property buying rules get bent in ‘scary’ market Joshua Chaffin

Goldman Sachs analyst Masaru Sugiyama cautioned that Line and Yahoo Japan combined would still be “far smaller” than Rakuten in terms of transaction value of their digital payments services. The two groups together would also be dwarfed by Facebook, Amazon and China’s Tencent in every measure

private through a tender offer at a proposed price of ¥5,200 a share, which represents a 13 per cent premium to the messaging app’s share price on November 13 before news of the talks broke last week. Z Holdings, a subsidiary of SoftBank’s telecoms arm formerly known as Yahoo Japan, and Naver, the South Korean internet search group that owns 73 per cent of Line, plan to each spend ¥170bn on the tender offer. The multi-tiered tie-up will involve SoftBank’s telecoms arm, which owns a 45 per cent stake in Z Holdings, creating a 50-50 joint venture with Naver. After the merger, Z Holdings will remain a listed entity, which will become a consolidated subsidiary of SoftBank’s telecoms arm. Following a surge last week, shares in Z Holdings rose 1.2 per cent on Monday after the deal was formally announced, while Line climbed 2.2 per cent. Shares in SoftBank’s telecoms arm fell 0.3 per cent and Naver gained 2.9 per cent. Mitsubishi UFJ Morgan Stanley advised Z Holdings, while Line was advised by JPMorgan. Mizuho advised SoftBank’s telecoms arm, and Naver was advised by Deutsche.

Arash Massoudi, Anjli Raval and Simeon Kerr

audi Arabia has abandoned plans to formally market shares in its state-owned oil company outside the kingdom and its Gulf neighbours, in the latest sign of the initial public offering’s shrunken ambitions. Bankers learnt on Monday that no formal European investor meetings would take place, a day after roadshows in the US and Asia were called off, according to people familiar with the matter. The decision is the latest setback for the kingdom, which will now seek to raise about $25bn through the flotation of Saudi Aramco — just a fraction of the $100bn it once sought. It will do so by relying heavily on local investors and those in the Gulf. “It’s all local now,” said one person briefed on the process. Saudi Arabia is attempting to list the oil company at a valuation acceptable to Crown Prince Mohammed bin Salman, who pushed for a $2tn valuation for almost four years and has made the IPO the centrepiece of planned economic reforms. However, Saudi authorities have scaled back their expectations in an effort to entice investors at home and abroad. On Sunday, the company revealed

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a price range for the shares that would value the company at between $1.6tn and $1.7tn. That valuation is still more than foreign institutions have been willing to pay, a message that was conveyed to the kingdom’s leadership several times in recent days, two people familiar with the matter said. Saudi Aramco executives had been due to travel to cities in the US, Asia and Europe but now investor meetings are likely to be restricted to Saudi Arabia, the UAE, Kuwait, Bahrain and Oman, according to one person briefed on the matter. Gathering orders for the shares is set to continue until December 4, with the stock due to price the following day and then begin trading on Riyadh’s Tadawul exchange a week later. Saudi Arabia intends to sell 0.5 per cent of the company to local retail shareholders, luring them with a bonus share scheme as long as they hold the stock for a fixed amount of time. The sweetener comes as authorities have leaned on local banks to make loans available to investors and as some wealthy families have been pressured to invest in the IPO. Saudi Aramco declined to comment. The remaining 1 per cent of the company being sold is expected to be taken largely by Saudi insti@Businessdayng

tutions and funds in the region. Saudi Arabia has also been courting state funds from Russia, China and elsewhere in Asia. These government-level discussions are likely to continue, another person briefed on the matter said. Institutional investors have raised concerns about the security of oil infrastructure after the attacks on key facilities in September, governance issues and state interference in Saudi Aramco’s corporate strategy. In recent weeks they briefed bankers that a valuation of $1.2-1.5tn was more reasonable. Foreign institutional interest will be limited to around 1,500 qualified foreign investors already able to trade on the Saudi stock exchange, or those nominated by Saudi Aramco or its advisers and approved by the market regulator. The limited pool of foreign investors is a blow to the kingdom, which saw the listing as a means to bring in a large pool of quality investors who are also shareholders in Saudi Aramco competitors such as Royal Dutch Shell and ExxonMobil. One banker said his colleagues were deflated by the decision not to market the Riyadh listing to international investors after months of preparations for what was billed as comfortably the biggest initial public offering in history.

BUSINESS DAY

Tuesday 19 November 2019

NATIONAL NEWS

Airbnb seals $500m Olympics sponsorship deal ahead of listing Short-stay platform’s agreement covers summer and winter games until 2028 Murad Ahmed and Alice Hancock

irbnb has signed a $500m deal to sponsor the Olympic Games until 2028, as the accommodation-booking platform targets the world’s biggest sporting event. On Monday, the San Francisco-based company announced it had joined an elite corporate list that included Coca-Cola, Alibaba and Toyota as part of the “worldwide sponsorship programme” for the International Olympic Committee, the governing body of the games. The deal covers the next five Olympics starting with next year’s in Tokyo, and including the subsequent winter and summer games in Beijing, Paris, Milan and Los Angeles. The five cities are among Airbnb’s biggest markets for private accommodation rentals worldwide. People briefed on the negotiations valued the deal at about $500m, which includes a substantial payment to the IOC but takes into account the cost of services that Airbnb will provide, such as free accommodation to athletes and executives. The contract is in line with other recent sponsorships of the IOC, such as with Bridgestone and Panasonic, which have paid $200m-$250m over a four-year Olympic cycle. According to the IOC, its top 12 sponsors provided revenues of a little more than $1bn for the 2014 winter games in Sochi and 2016 summer games in Rio de Janeiro. “In the past, people have travelled to the Olympics on Airbnb, of course,” said Joe Gebbia, Airbnb’s co-founder. “But we have never been able to officially market to host cities or potential hosts about the opportunity of

taking visitors. Through this partnership, we actually can.” He said the company has 200,000 Airbnb hosts in the five upcoming Olympic host cities, a number he hopes to vastly increase through its IOC sponsorship. It is the first time Airbnb has signed a large sponsorship deal. The group has previously turned away approaches for broad marketing initiatives, such as working alongside airlines to create package holidays, a person familiar with the company’s thinking said. However, Airbnb executives decided the Olympics offers rare reach for a group that operates in the majority of countries and big cities across the world. Thomas Bach, IOC president, has been under pressure to institute reforms to lessen the eye-watering costs of hosting the games. He said the Airbnb deal will allow cities to avoid building new hotels, saving tens of millions of dollars in construction costs. “In terms of the visibility and sustainability of the games, I think the advantages are obvious,” Mr Bach said. The move is designed to promote Airbnb’s brand to new hosts and customers, as it prepares a listing planned for next year. The company, which was founded in 2008, has about $3.5bn of cash, providing the financial firepower for the Olympics deal, a person familiar with the matter said. Last month, investors trying to buy indirect stakes in the Airbnb in private markets valued the group at up to $42bn. The US company said it had revenues of more than $1bn in the second quarter of this year. It generated profits, before interest, taxes, depreciation and amortisation expenses, in 2017 and 2018.

A promise to clean up Mexico’s endemic corruption helped propel Andrés Manuel López Obrador to power © MARIO GUZMAN/EPAEFE/Shutterstock

López Obrador accused of double standards in corruption war Critics say Mexico’s president is purging opponents while shielding allies Jude Webber and Michael Stott

exico’s president Andrés Manuel López Obrador is being accused of using his public war on corruption to force out opponents while turning a blind eye to questionable behaviour by allies. “There’s a very big contradiction between what the president promised and what is happening. There is a politicisation of justice,” said María Amparo Casar, executive president of Mexicans Against Corruption and Impunity, an NGO. The latest incident came last month, when Eduardo Medina Mora, a former attorney-general and security minister, quit as a Supreme Court judge. Mr López Obrador said Mr Medina Mora had resigned to focus on an investigation into allegedly suspicious financial transactions. Months earlier, the judge had denied allegations he had transferred large sums of money to international bank accounts in his name that were allegedly out of line with his income. But when it later emerged that

his bank accounts had been frozen just before he quit, and were unfrozen immediately afterwards, the government faced claims that it was manipulating the inquiry to oust a political opponent. Mr Medina Mora, who was named to the court by the president’s predecessor, Enrique Peña Nieto, from the long dominant PRI party, and served as minister under the rightwing PAN, denies wrongdoing. Mr Medina Mora’s fate was seen to be in contrast to the treatment of Manuel Bartlett, head of the state electricity company CFE and a top ally of the president. He faced just an administrative probe after a media investigation uncovered a string of properties and companies linked to him and his family that he had omitted from his official income declaration. Mr López Obrador has dismissed the media allegations against Mr Bartlett, who has denied wrongdoing, as “an attempt to besmirch the new government”. The CFE chief said properties and firms linked to Julia Abdala, his partner of more than 20 years, were not relevant to his declaration because

“I have no wife or concubine”. Mr Medina Mora and Mr Bartlett are not the only public figures to face scrutiny. Carlos Romero Deschamps quit in October after almost three decades as powerful union boss at Pemex, Mexico’s state oil company, after being put under investigation for alleged corruption. The probe comes as Mr López Obrador says he is seeking to make Mexican unions more transparent and accountable. Mr Romero Deschamps denies the allegations. By contrast, there has been no investigation into Yeidckol Polevnsky, head of the ruling Morena party, over a hefty tax waiver she was granted, and which she said resulted from an error by her accountant. In another case, a judge who had upheld legal challenges against Mr López Obrador’s planned new Mexico City airport project — which is designed to replace a partially built $13bn hub which the president has scrapped — was placed under investigation for alleged corruption and suspended from his post for six months.

activists such as Joshua Wong and Edward Leung were imprisoned. Mr Wong is now out of jail, while the still-imprisoned Mr Leung, finds his slogan — “Free Hong Kong, revolution now” — chanted on the streets. There were always tensions inherent in the uneasy formula of “one country, two systems”. In 2003, there were big demonstrations against a proposed national security law for Hong Kong, pushed by Beijing. But in the 15 years between the handover of Hong Kong from Britain to China in 1997 and the accession to power of Mr Xi in 2012 those tensions proved manageable. Hong Kong citizens could reasonably hope that mainland China might evolve into a more liberal and lawgoverned society in the decades running up to the full integration of Hong Kong with China scheduled for 2047.

But during the Xi years, China has gone backwards politically. Maoist-era slogans have been revived and “Xi Jinping Thought” has been written into the Chinese constitution. Free speech has been further restricted; civil rights lawyers have been locked up and non-governmental organisations have been closed down. It is hardly surprising if Hong Kong now regards the prospect of full integration with the mainland with horror. And that date no longer seems impossibly far-off. The most radical demonstrators are often in their teens or early twenties. They will be in the prime of their lives when the second handover takes place in 2047. So their assertions that they are fighting for their freedom cannot be dismissed as hyperbole — even if their tactics can be challenged.

Hong Kong is Xi Jinping’s failure

The revolt raises questions about the Chinese president’s entire project Gideon Rachman

he situation in Hong Kong is a nightmare for Xi Jinping. China’s president has made the restoration of his country’s power and dignity the central theme of his presidency. But part of China’s sovereign territory has descended into violent anarchy. Universities have turned into battlegrounds. Protesters are hurling Molotov cocktails at the police, but they appear to retain a strong measure of support from the population. Chinese troops have appeared on the streets — but so far only to help clear the roads. Deploying them against the demonstrators could plunge Hong Kong into a long-term insurrection, similar to Belfast in the 1970s or Algiers in the 1950s. Mr Xi could plausibly argue that the immediate crisis is not his fault.

The spark for the first demonstrations in June was the introduction of a bill allowing extradition of criminal suspects from Hong Kong to mainland China. By most accounts that was an idea pushed by Carrie Lam, Hong Kong’s chief executive. When Beijing saw the depth of the opposition, it tried to react sensibly by suspending the bill. But, by then, the protest movement had broadened its aims and gathered an irresistible momentum. Mr Xi bears a broader responsibility. In the seven years since he came to power, the Chinese state has become significantly more authoritarian, preparing the ground in Hong Kong for a backlash against rule from Beijing. An anti-corruption drive has seen prominent figures disappear from public life on the mainland and a rash of suicides among Comwww.businessday.ng

munist party officials. More than a million people have been interned in re-education camps in the province of Xinjiang. The treatment of Xinjiang is often cited by demonstrators in Hong Kong as a sign of how far Beijing will go to crush cultural and regional diversity. The increasingly Kafkaesque legal system of mainland China stands in stark contrast with Hong Kong’s own tradition of the rule of law. But during the Xi period, the mainland’s intolerance for free speech and thuggish attitude towards the law has seeped into Hong Kong itself. The case of some Hong Kong booksellers who were kidnapped — then detained on the mainland — sent a chilling message, so did the decision to ban elected lawmakers from the Hong Kong assembly, for mangling loyalty oaths to China. Prominent anti-Beijing political

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To save the euro, turn it into a digital stablecoin A bond-backed currency would overcome problems created by incomplete monetary union

Thomas Mayer

hen economic weakness turns into recession, Leo Tolstoy’s observation that “every unhappy family is unhappy in its own way” will apply to the eurozone countries. Increasing economic divergence will put strains on the eurozone that could lead to its collapse. The European Monetary Union project has failed to reach completion. While the banknotes issued by the European Central Bank are of uniform credit quality, the value of euros deposited in banks differs across countries depending on the financial firepower of national governments to back the deposits when banks fail. Banking union was supposed to complete EMU, but its most critical component, a common deposit insurance, is still missing due to political resistance to risk sharing. While the German finance minister Olaf Scholz recently proposed a potential compromise, critics argue that the euro is doomed. I believe there is a solution: the creation of a truly digital euro. The first step towards such a digital euro would be to introduce a bank deposit fully backed with central bank money. The ECB could effectively create funds needed to cover the deposit by purchasing outstanding eurozone government bonds. In a second step, the secure deposit could be set up as digital central bank money that can be transferred from person to person or company to company using blockchain technology. The euro would then become a “stablecoin” backed solely by government bonds. Only the ECB (and not the commercial banks) would be responsible for issuing it. To protect this new asset token from abuse by governments and counterfeiting, the electronic euro could be endowed with a digital watermark. This would mean embedding the rules for the original establishment and future increase of money supply as a “smart contract” in the coding associated with the asset token. The money supply would be increased through further purchases

of government bonds, but such purchases would have to be agreed independent of political influence and using a long-term perspective. For instance, growth of the digital euro money supply could be geared to the expected growth potential of the euro area economy. Rather than relying on bank lending, the money supply would be expanded by increasing ECB holdings of government bonds. To avoid printing money to finance government budget deficits (as proposed by modern monetary theory), governments could commit themselves to distribute the money they receive from the bond sales directly to their citizens as a “money dividend”. In a world of digital euros, commercial banks’ main role would be to take deposits and lend them to investors. They could continue to create private debt money through lending, but there would be no state guarantee for conversion at parity into digital euros. Banks would start to resemble investment funds whose assets are protected against first loss by an equity cushion. Savers could choose the bank that suited them according to their preferences for returns and first loss protection. The central bank would lose the ability to use interest rates to manage banks’ credit money creation for policy purposes. Given the new impotence of monetary policy in a world of negative rates, this would hardly matter. Digitalisation offers a way to reduce the debt of the eurozone states and to safeguard the euro. Fiscally conservative northern countries would agree to the one-off monetisation of old debt on the balance sheet of the ECB in order to ensure the creation of secure money. In return, the highly indebted southern countries would have to accept that after the one-off monetisation of their old debts, further bailouts through debt monetisation would be impossible. The process would remove government bonds worth €7tn from the market. Public debt of all eurozone countries could be reduced to less than 25 per cent of gross domestic product, giving each one new room for prudent fiscal policy.

The China Securities Regulation Commission has investigated credit rating agencies inside the country © FT montage; Reuters

Why global capital flows could wreck the bond rally Money should spill out of dollar assets as China’s economy shifts Miranda Carr

ond bulls should not rest easy. The world may have reconciled itself to the financial insanity of negative yields, as central banks continue to cut interest rates. But there are signs that the big rally in bond prices may be reaching a turning point. The reason? A major, longterm rebalancing in capital flows between the US and China. Instead of excess global capital flowing into overinflated US dollar markets, money is moving into underinvested renminbi assets. China is turning from being one of the largest providers of global capital and a “double surplus” economy — having both a trade surplus and a financial one within its balance of payments — to a consumer of capital. This is a result of its fiscal deficit rising and current account surplus shrinking. This trend could either significantly tighten global monetary conditions or, more unexpectedly, lead to the imposition of global capital controls. Both scenarios would shake bond markets out of their current complacency. In the last year, after China opened up its capital market to foreign institutions and issued $1.5tn of government debt, foreign inflows into China’s bond

markets shot up to $100bn, according to Wind data. Meanwhile, the country’s investment in US Treasuries switched from a positive annual average of $70bn to a negative $80bn. China used to recycle its balance of payments surplus from trade and foreign direct investment into US dollar assets. Now that the surplus is in the form of inflows into domestic capital markets, this recycling is no longer required. This rebalancing has been building over the past few years, effectively tightening US monetary policy further than just the Fed’s previous interest rate hikes. If the trend continues, higher US yields over the long-term are inevitable, as there is less money invested in dollar assets. This could translate into further shocks for emerging markets, as rising yields on the greenback suck money out of those markets, as well as leading to higher rates in Japan and the EU. This would be a painful, but necessary, process. But there is a potentially more dangerous alternative for global markets, which would previously have been unthinkable in the US: capital market restrictions. Recent proposals from Washington to curb US investment in Chinese assets can be seen not just as a politically motivated threat in the context of the trade war, but as a

way of preserving capital in the US dollar system and preventing it from flowing into renminbi assets. It is an economically logical, if not entirely rational, response to the capital rebalancing and the resulting economic hit. This would be quite a reversal from recent decades. The US has benefited from three major waves of foreign inflows into US dollar assets in the past 20 years, starting with Japan in the 2000s, followed by China from 2008, and then the EU earlier this decade. The three major economies now hold about one quarter of US Treasuries, which supports the government’s record debt issuance and its low borrowing rates. This capital account surplus has conventionally been attributed to trade inflows and prudent Japanese, Chinese and German households dutifully shovelling all their savings into the bank and not following the profligate spending patterns of the Americans. If that was the whole story, then it might be economically manageable. But this understanding overlooks factors that effectively keep money trapped in each of these surplus economies. This has led to the creation of significant amounts of “excess” money, which is then lent out to the US through the purchase of dollar assets, whether the Americans want to borrow it or not.

“By the time we are finished with this project, we will be approaching $1bn of investment in California by late 2021,” said Gene Gebolys, World Energy chief executive. “Not one penny of that would be spent if it were not for the LCFS.” Started in 2011, the California LCFS scheme imposes a carbon cost on conventional transport fuels such as gasoline that have carbon intensity scores above the state’s requirements. Oil companies must buy credits to comply with the LCFS. Businesses that offer low-carbon fuel alternatives generate the credits. Oregon’s credit, which started trading in late 2016, was modelled after the California programme.

California carbon credit transactions totalled more than $2bn in 2018, the state has estimated. With the price at a record high, the market could hit $3bn this year, said Graham Noyes, executive director of the Low Carbon Fuels Coalition, a trade association. The LCFS credits have been increasingly valuable to biofuels producers as prices for a US federal carbon credit have been in the doldrums. In part because of changes to ethanol policy by the Trump administration, the price for credits formally known as Renewable Identification Numbers, or Rins, have slumped in 2019.

US carbon credit prices hit record highs California and Oregon schemes boost biofuel investment even as federal credits fall Patrick Temple West A graphic with no description he prices of carbon credits on the US west coast have soared to new highs as states have toughened standards, driving investment in clean fuel producers and creating new opportunities to turn greasy animal fats into jet engine fuel. California’s low-carbon fuel standard (LCFS) credit was at a record in September and October, the state said last week, at more than double the price two years ago. A credit in the neighbouring state of Oregon set a record in September that was close to four times the price two years ago.

While oil refining and importing businesses — companies that typically need to buy credits to comply with emissions regulations — had stockpiled credits in years past, they have had to buy more as rules have gradually tightened from year to year. “If you are selling renewable fuels anywhere in the world, the best place to sell them for your return is in California and Oregon,” said Terry Kulesa, chief executive of Red Rock Biofuels, which converts tree branches, bark and other sawmill residues into renewable fuel that qualifies for the states’ carbon credits. The price rises come despite an expansion in the products that qualify for the credits, but look unlikely to www.businessday.ng

be reversed until substantially higher quantities of the qualifying cleaner fuels are being produced. Last year, California expanded the credit’s scope to sustainable aviation fuel, so businesses that refine greasy scraps of cooking oil or tallow into aviation fuel have been earning the credit this year. The international aviation market is responsible for about 2 per cent of the world’s greenhouse gas emissions, California has said. World Energy, a Boston-based renewable fuel provider, is spending $350m to convert an oil refinery outside Los Angeles to make biofuel from agricultural waste, having won bigger orders from United Airlines for aviation biofuel for flights departing from LA.

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Tuesday 19 November 2019

BUSINESS DAY

ANALYSIS

FT The stigma around menopause fades as women seek change at work

More employers are supporting staff who suffer debilitating physical and mental symptoms Susie Mesure

or Alison Martin-Campbell, the sweaty, sleepless nights were the worst aspect of being menopausal. She would wake, drenched, up to 20 times a night before blearily getting up to commute to EY, where she is a secretary in the accountancy firm’s corporate finance arm. “I was really struggling to function during the day. I couldn’t concentrate, I was very clumsy. I was also triple checking all my work as I just didn’t trust myself,” she says, adding that thankfully she didn’t make any major mistakes even when she felt at her worst. “But it was exhausting.” Two years ago, with no sign of her symptoms abating, she wrote a sheet of tips on how to cope with

“More women are in more senior positions, working full-time. Plus they are the sandwich generation, looking after older parents and young children. It’s the perfect storm,” she adds. Sarah Churchman, head of diversity, inclusion and wellbeing at PwC, says the accountancy firm is retaining women who previously would have quit after having children. Around one in five of the firm’s partners are female; 15 years ago that figure was one in 20. “It’s a success story that we’re talking about the menopause at work,” she adds. “Menopause has been the nub of jokes but there are serious consequences. We want [women] to be able to talk about any symptoms they’re experiencing and get the support they might need.” PwC has stopped short of issu-

Facebook’s fake numbers problem — Lex in depth

The social network has 2.5bn monthly active users but almost 400m of the accounts are bogus Elaine Moore and Hannah Murphy

the menopause, which her then line manager suggested she circulated with colleagues. She was EY’s employee representative in a recent webinar about the menopause; 175 people tuned in. She also heads EY’s 40+ Network, an informal group she created to help employees with age-related issues, including menopause. “I can offer colleagues a one-to-one chat, sharing my own experience and suggestions,” she says. “A lot of women say, ‘I thought I was going mad’. Just speaking to another person who knows what it’s like can be very helpful.” Menopausal women are the fastest-growing demographic in work places across the UK, according to government figures. This is why companies are starting to consider how they can support employees who may be struggling with symptoms from hot flushes and brain fog to depression and a greater propensity for urinary tract infections. Organisations advising businesses on creating specific guidelines or policies say interest from firms across the spectrum has exploded in the last three years. With more than 4.3m women over 50 in employment in the UK, companies are increasingly asking for help. This has prompted the UK’s workplace conciliation service, Acas, to publish guidance last month on how employers and managers should support menopausal staff. “Women are going through menopause at work probably for the first time in our history,” says Sharon Vibert, who works for a consultancy called Henpicked: Menopause in the Workplace. The organisation helps companies including HSBC, Sainsbury’s, Network Rail, Northumbrian Water and a variety of NHS Trusts to tackle the issue. Ms Vibert’s organisation held 51 workshops for companies in October alone.

ing specific menopause guidelines, preferring to rely on its existing wellbeing policy, in common with many other companies. The accountancy firm also recently released a webinar with guidance for line managers and posts regular stories about mental health featuring issues like the menopause on its internal news channel. Encouraging people to talk about their experiences can help others in the same situation to seek help, Ms Churchman adds. She urges other organisations to talk about the business rationale for helping staff through a biological change that affects half the population. “It’s still a slightly taboo topic but the more we talk about it the less taboo it becomes,” she says. BNP Paribas is among those looking to change attitudes. “When people talk to me they lower their voice and whisper the word ‘menopause’. I am making it my mission to speak loudly around this. It needs to be OK for people to say they’re experiencing challenges and for team leaders to say they have people who need support,” says Jane Ayaduray, the French bank’s UK head of diversity and inclusivity. Claire Hardy, a lecturer in organisational health and well being at Lancaster University, is leading a project to assess the impact of adopting specific policies. “Is it enough to have a policy in place? Does that make any change? We don’t know.” The challenge with a menopause policy versus a pregnancy policy is that the former is a fluid process, usually affecting women aged 45 to 55. One in 20 women are done with ovulating before they turn 45, according to the Daisy Network, a charity supporting women who experience early menopause. “You can’t time stamp it, so it’s very difficult for women to pinpoint, ‘This is when my menopause started,’” adds Ms Vibert. www.businessday.ng

t first glance, Amy Dowd’s Facebook account appears perfectly normal. There is a smiling profile picture of a young woman surrounded by autumnal leaves and the date that she began a new job at Southeast Missouri State University. But look more closely and things begin to seem strange. Unlike most 29 year olds, Amy has no friends, no interests and no photos. The only thing she has written is a gushing review of a US haulage company. “Fake account,” replied one user. They were right. This Amy Dowd does not exist. Her account is a fake bought by the Financial Times as part of an investigation into the millions of bogus accounts littering the social media network in spite of efforts to better verify users. The proliferation of phoney identities has reached a record high. That is a problem for a company that trumpets user growth — considered a barometer of health by investors — while receiving criticism for failing to prevent the spread of false information by third parties. Facebook’s own estimates suggest duplicate accounts represent approximately 11 per cent of monthly active users while fake versions make up another 5 per cent. Others claim the total is higher. Yet Facebook continues to promote its user base as an incredible 2.45bn per month — close to one-third of the global population. Growth in user numbers looks significantly less impressive once adjusted for duplicate and fake accounts — up 7 per cent in the past two years, rather than 18 per cent calculated by Facebook. The discrepancy highlights the lack of transparency around the metrics used by one of the world’s most valuable companies. Given the importance of users to the company’s revenue growth and profitability Facebook needs to open up its data to more detailed

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audit and create a new, adjusted metric to count users. Mark Zuckerberg has always said the company he founded is a platform for authenticity. Unlike anonymous chat rooms, Facebook encourages real names and photos. Facebook-owned messaging service WhatsApp and photo-sharing platform Instagram are promoted in the same way. Last year, the chief executive told Congress users were “not allowed” to have fake accounts. Yet creating an account simply requires a name and email address — no other verification is required. Third-party onlinevendors, such as pvacart.com and residentialpva.com, exploit this open-door policy, competing to offer unique, handcrafted, phone-verified profiles to buyers via a PayPal or bitcoin payment. “Very trusted by Facebook, very resistant to being banned,” one of the companies claims. The process is easy. It costs just $25 to buy 50 fake accounts. More if they are fleshed out with profile pictures, interests like sports teams, even reviews of longdistance moving companies. After an online payment is made the accounts arrive by email the next day in a spreadsheet of usernames and passwords. Facebook security checks were triggered for newly created accounts bought by the FT when details were added. But accounts created years ago — like Amy Dowd’s — did not arouse suspicion until some were accessed in multiple counties at the same time. It was blocked on Friday. What happens next is up to the buyer. Fake accounts can be used to boost follower numbers, which is useful for online influencers who are paid for plugging products or services. Purchasers may use bogus identities to spread disinformation or unsolicited commercial messages, content or requests. Facebook is aware of the issue. The Federal Trade Commission has declared that selling fake followers is illegal. But last week the company declared it had shut down an extraordinary 5.4bn fake accounts in the first nine months @Businessdayng

of this year alone — more than double the number of actual users. In March, it announced that it was suing four Chinese companies for selling fake Facebook and Instagram accounts, citing illegal use of the company’s trademarks. The defendants have since taken down the sites. “It is adversarial,” says Alex Schultz, Facebook’s vice-president of growth. “As we lock down one area, spammers come in and they will attack another area. And so we take on the new attacks.” Fake account detection is complicated by the fact that not everyone uses Facebook in the same way. Line chart of Share price ($) showing Share price growth has stalled for Facebook “There is a massive range of behaviours,” says Mr Schultz. “Think about a new user to the internet who has never touched an app or website. They will behave very differently to a superconnected teen in the west or somewhere like Japan or South Korea.” In 2017, Facebook adjusted its calculation and raised its estimates of fake accounts but it also admits the problem itself has grown as it has expanded in emerging markets. When the company filed its S-1 document with the Securities and Exchange Commission, ahead of an initial public offering in May 2012, estimates for fake or duplicate users were not included. By the end of that year, Facebook calculated that 5 per cent of accounts may have been duplicates, 1.3 per cent “misclassified” and 0.9 per cent “undesirable”. Fake users have become more difficult to identify as the company has grown. When it launched in early 2004 Facebook offered an appealing veneer of exclusivity. Membership was limited to Harvard students and then extended to a handful of Ivy League universities. By 2006, this approach had been abandoned in pursuit of global domination. Membership numbers exploded. In 2008, the social network had 100m users. By 2012, it had 1bn.

Tuesday 19 November 2019

BUSINESS DAY

news

Lagos evacuates lion from private residence in V/Island to Lekki zoo

Stakeholders to chart ways for economic development at 2019 corporate governance conference

...to prosecute Indian owner

OLUWASEGUN OLAKOYENIKAN

Joshua Bassey

peratives of the Lagos State Task Force on Monday succeeded in evacuating a lion kept in a private residence in Victoria Island to a zoo at the Omu Resorts in Lekki area of the state. Chairman of the task force, Olayinka Egbeyemi disclosed that the exercise was carried out in conjunction with officials of the Lagos State Ministry of Agriculture and medical personnel from the Faculty of Veterinary Medicine, University of Ibadan. Speaking further, Egbeyemi said that Ogunmo Bamidele, who led the medical team from UI, had to tranquilise the tiger thrice before evacuating it. He confirmed that the task force responded to a petition from residents while investigations revealed that the lion was brought in from Cameroun by an Indian, two years ago. “Immediately I got the petition, I deployed my offi-

cers to the house at No. 229, Muri-Okunola Street, Victoria Island, Lagos, where they kept a close watch for more than 72 hours before the lion was finally removed today,” Egbeyemi said. The chairman assured residents that the owner of the lion would face the full wrath of the law, warning residents to abstain from harbouring wild animals that endanger the lives of others. “In as much as we appreciate residents around Victoria Island for their quick action, we urge every member of the public to be observant in their immediate environment and report any strange or unusual activity to appropriate government authority for prompt action”, he stated. The director, Veterinary Services, Lagos State Ministry of Agriculture, Macaulay Rasheed, also advised members of the public to stop rearing wild animals at private homes in order to avoid unnecessary attack and contagious animal diseases.

t a k e h o l d e r s a c ro s s various sectors of Nigeria will gather at the 2019 Annual Corporate Governance Conference and President’s dinner of the Society for Corporate Governance Nigeria on Thursday, November 21 to discuss and proffer solutions to issues of governance in the country’s corporate sector towards safeguarding its economic development. The conference organised by the Society for Corporate Governance Nigeria, a not-for-profit organisation committed to the development of corporate governance in the country, is scheduled to hold at the Ballroom of Oriental Hotel in Lagos. The theme for this year’s conference is “Purposeful Leadership and Governance as a Prerequisite for National and Economic Development”, while the President’s dinner/induction ceremony, which will be held under the distinguished chairmanship of Pascal Dozie, will be hosting captains of industries, heads of institutions, board chairmen and directors, company secretaries, members of the diplomatic

corps, regulators and other stakeholders from across sectors. The stakeholders will be gathering on a platform for impactful discourse on the role of good governance and purposeful leadership on economic development. The event will also feature key leaders of thought, boardroom exper ts and public servants with a track record of excellence in a panel session sharing insights from their wealth of experience in governance, unveiling of publications, networking and an evening of fine dining and socializing. The Society for Corporate Governance Nigeria has since inception continued to deploy its resources to enhance knowledge and practice of corporate governance best practices through research & publications, intensive learning programmes for board chairmen and directors, conferences, seminars and breakfast meetings. In line with its vision in fostering good governance and best practices in Nigerian organizations, the society has hosted over 7,000 business executives at its annually held corporate governance conference.

Nasarawa bans street trading, hawking, road-side markets Anthony Adgidzi, Lafia

he Director General of the Nasarawa State Market Bureau (NSMB), Abdullahi, Tanko Zubairu, at the weekend announced that the state government had banned selling on roadsides in the state. Zubairu said the government was worried by the indiscriminate commercial activities in the state, and directed that all those selling by the roadside should be relocated to the new ultramodern market built by government available to interested occupants at affordable prices for interested occupants. The DG restated that there was a law in the state forbidding street trading across major towns of the state. He, however, explained that the ban on roadsides trading, especially in Lafia, was to ensure that traders carrying out such activities in the streets of the Lafia metropolis were relocated to the Kwandare ultra-modern market in Lafia, which was built with funds accessed through bond but unfortunately lying empty. According to him, “The Kwandare ultra-modern market was built with a bond which the state government collected, and the market

How PDP lost to APC in Bayelsa Guber Solomon Ayado & James Kwen, Abuja

...Can Lyon join PDP?

any reasons have trailed the loss of the People’s Democratic Party (PDP) to the All Progressives Congress (APC) in last Saturday’s governorship election in Bayelsa state. Bayelsa is a core PDP state and since its creation, this is the first time another political party has won the governorship election in the place. The events that unfolded before the gubernatorial election had indicated a serious division in the ranks of the opposition party in the state. While political watchers who are conversant with Bayelsa politics have adduced that the woeful loss by PDP is not unconnected with the overstretched political ambition of Governor Seriake Dickson, others said the ousting of PDP was a deliberate display of the grievances of the people of the state over the misgovernance of the incumbent government. Until now, the opposition APC had never succeeded in its quest to rule the state. The party, it was gathered, knew very well that it lacked political structures to dislodge the PDP. However, there is strong belief that the loss of PDP is not far from the alleged anger of former President Goodluck Jonathan, who was said to have got infuriated due to his reported undermining by governor Dickson. It was said that Jonathan simply turned the table to show to those who took his political simplicity for granted to learn a bitter lesson. Yet, since the

political campaigns started, Jonathan was not seen to have worked against his party and Dickson. But it was alleged that outgoing Governor Seriake Dickson, in his personal desire to plant a successor and at the same time secure senatorial ticket, had hijacked the PDP’s structures and in the process side-lined the former president and his allies. Also, it was said that Dickson singlehandedly tipped the party’s candidate and at the same time tampered with the long standing zoning arrangement between the three senatorial zones in the state. This, apart from party stakeholders who are ardently loyal to Jonathan, the wife of the former President was obviously peeved by Dickson’s display of disloyalty and was said to have worked in favour of the APC candidate. The Minister of State for Petroleum and former Bayelsa governor, Timipre Sylva’s factor was also strong point that crippled chances of PDP. It was speculated that the former president and his wife, alongside his loyalists craftily and or not openly, supported the APC candidate, David Lyon and secretly worked against Senator Douye Diri of the PDP. That is why the loss by PDP was not envisaged. Jonathan could have insisted on any of his loyalists like Igali being the candidate but he settled on Timi Alaibe who was formidable and had the support of all. Former President Olusegun Obasanjo even

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joined Jonathan to beg Dickson and PDP National chair, Uche Secondus to let Alaibe get the ticket. But Dickson wanted his cousin. Bayelsa people hated Dickson particularly Bayelsa East (Jonathan’s people) whom Dickson called “non-core Ijaw.” Core Ijaws are apparently according to Dickson, the Sagbama/Ekeremor/Southern Ijaws of Bayelsa and the Bomadi/Burutu/Patani of Delta and as such only they should be in charge. Disckson preferred Diri and never agreed to the choice of Jonathan, Chief Timi Alaibe, a former Managing Director of the Niger Delta Development Commission (NDDC). By Dickson’s calculations, it was said that if he allowed Alaibe as governorship candidate of the PDP, it would have reduced or blocked his ambition of moving to Senate. Another issue that contributed immensely to PDP’s loss was pre-primary election issues. Many PDP stakeholders, especially those that are loyal to Jonathan had defected to other political parties particularly the APC, after the conduct of the party primary went berserk. Some of the defectors including Michael Ogiasa, special adviser to Governor Dickson on power development, Senator Nimi Amange and Chief Robert Ajala Enugha, the immediate past chairman of the Environmental Sanitation Board under Seriake Dickson’s government, among others jumped ship. https://www.facebook.com/businessdayng

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should not be left empty. The relocation of such categories of traders to the market will provide decent and peaceful marketing activities in the state.” When asked about allegations by traders of the Al-amis (Thursday) market that they were forced by the state government agencies to relocate to the ultra-modern market, the director-general said: “Nobody forced them to relocate. Not everybody will move to the ultra-modern market from the Alamis market.” “Officials of the Alamis market had approached the market bureau requesting for space in the ultra-modern market when they stated that some Alamis market traders wanted to leave trading by the roadsides. “Consequently, the officials agreed that by November 1, 2019, those affected traders will move to the ultramodern market.” Zubairu explained that there were three categories of traders who would move to the ultra-modern market, which include the Ochanja market traders, Grain Store traders, and the Alamis market traders. “The government has paid compensation to the affected traders to relocate,” he said.

Tuesday 19 November 2019

BUSINESS DAY

Live @ The STOCK Exchanges Prices for Securities Traded as of Monday 18 November 2019 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 348,343.21 9.80 -6.67 452 20,235,096 UNITED BANK FOR AFRICA PLC 241,105.92 7.05 -4.73 363 20,806,936 ZENITH BANK PLC 587,114.43 18.70 -0.80 532 29,544,488 1,347 70,586,520 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 240,498.46 6.70 -2.19 384 14,666,555 384 14,666,555 1,731 85,253,075 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,462,896.08 121.00 - 61 524,386 61 524,386 61 524,386 BUILDING MATERIALS DANGOTE CEMENT PLC 2,469,169.52 144.90 0.07 147 1,649,737 LAFARGE AFRICA PLC. 240,006.15 14.90 - 108 1,233,878 255 2,883,615 255 2,883,615 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 323,467.98 549.70 - 11 1,130 11 1,130 11 1,130 2,058 88,662,206 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 85.50 - 1 1,000 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 5 2,353,092 UPDC REAL ESTATE INVESTMENT TRUST 11,873.80 4.45 - 6 17,381 12 2,371,473 12 2,371,473 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 12 2,371,473 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 OKOMU OIL PALM PLC. 47,695.50 50.00 -5.57 18 245,270 PRESCO PLC 34,600.00 34.60 - 15 80,627 33 325,897 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,520.00 4.26 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,560.00 0.52 - 23 443,638 23 443,638 56 769,535 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 794.19 0.30 - 0 0 JOHN HOLT PLC. 217.92 0.56 - 1 4,050 S C O A NIG. PLC. 1,903.99 2.93 - 2 1,000 TRANSNATIONAL CORPORATION OF NIGERIA PLC 41,867.43 1.03 -5.50 83 12,852,795 U A C N PLC. 19,448.75 6.75 2.27 89 102,546,110 175 115,403,955 175 115,403,955 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 24,486.00 18.55 - 8 10,500 ROADS NIG PLC. 165.00 6.60 - 0 0 8 10,500 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,520.44 0.97 - 4 129,346 4 129,346 12 139,846 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 7,751.20 0.99 - 11 175,050 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 1 75 GUINNESS NIG PLC 67,901.87 31.00 8.39 83 807,492 INTERNATIONAL BREWERIES PLC. 80,801.10 9.40 - 8 184,171 NIGERIAN BREW. PLC. 387,849.75 48.50 - 82 1,072,225 185 2,239,013 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 143,400.00 11.95 2.14 224 8,912,283 FLOUR MILLS NIG. PLC. 66,631.17 16.25 - 58 557,732 HONEYWELL FLOUR MILL PLC 7,930.20 1.00 - 22 1,121,195 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 0 0 NASCON ALLIED INDUSTRIES PLC 39,344.16 14.85 - 12 128,720 UNION DICON SALT PLC. 3,321.07 12.15 - 0 0 316 10,719,930 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 16,903.82 9.00 - 25 148,310 NESTLE NIGERIA PLC. 911,554.69 1,150.00 - 27 6,897 52 155,207 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 4,640.63 3.71 - 13 152,750 13 152,750 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 20,845.00 5.25 -1.87 28 276,103 UNILEVER NIGERIA PLC. 106,282.60 18.50 - 69 821,987 97 1,098,090 663 14,364,990 BANKING ECOBANK TRANSNATIONAL INCORPORATED 128,446.86 7.00 -6.67 60 1,937,414 FIDELITY BANK PLC 57,370.10 1.98 -1.00 133 11,476,188 GUARANTY TRUST BANK PLC. 853,504.20 29.00 - 164 1,943,763 JAIZ BANK PLC 22,982.11 0.78 9.86 78 4,337,170 STERLING BANK PLC. 61,035.69 2.12 -4.93 52 2,599,700 UNION BANK NIG.PLC. 206,757.34 7.10 1.43 28 361,199 UNITY BANK PLC 8,416.32 0.72 7.46 33 1,227,737 27,002.13 0.70 -7.89 101 8,413,604 WEMA BANK PLC. 649 32,296,775 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 5,336.26 0.77 1.32 31 2,331,324 AXAMANSARD INSURANCE PLC 17,325.00 1.65 - 4 102,800 CONSOLIDATED HALLMARK INSURANCE PLC 3,170.70 0.39 - 0 0 CONTINENTAL REINSURANCE PLC 23,442.40 2.26 - 4 4,820 CORNERSTONE INSURANCE PLC 9,132.29 0.62 - 9 578,151 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 1 400 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 2,123.80 0.29 - 2 20,000 LAW UNION AND ROCK INS. PLC. 2,362.98 0.55 9.09 6 425,000 LINKAGE ASSURANCE PLC 4,080.00 0.51 - 0 0 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 1 1,221,745 NEM INSURANCE PLC 10,561.01 2.00 - 9 67,992 NIGER INSURANCE PLC 1,547.90 0.20 - 1 438,331 PRESTIGE ASSURANCE PLC 2,745.10 0.51 - 0 0 REGENCY ASSURANCE PLC 1,333.75 0.20 -4.76 3 214,000 SOVEREIGN TRUST INSURANCE PLC 1,668.16 0.20 - 3 345,000 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 1 1,000 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 1 77,088 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 0 0 WAPIC INSURANCE PLC 4,550.13 0.34 2.94 33 5,129,548 109 10,957,199

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MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,515.30 1.10 - 4 10,000 4 10,000 MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,200.00 1.00 - 2 750 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,796.93 1.39 - 0 0 2,265.95 0.20 - 0 0 RESORT SAVINGS & LOANS PLC UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 2 750 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 8,600.00 4.30 1.90 41 1,240,728 35,291.19 6.00 9.09 9 308,419 CUSTODIAN INVESTMENT PLC DEAP CAPITAL MANAGEMENT & TRUST PLC 660.00 0.44 - 0 0 36,635.01 1.85 -7.50 105 6,593,999 FCMB GROUP PLC. ROYAL EXCHANGE PLC. 1,029.07 0.20 - 0 0 STANBIC IBTC HOLDINGS PLC 408,464.63 39.00 2.63 23 444,796 13,800.00 2.30 0.88 131 6,333,247 UNITED CAPITAL PLC 309 14,921,189 1,073 58,185,913 HEALTHCARE PROVIDERS EKOCORP PLC. 1,844.82 3.70 - 5 29,305 852.75 0.24 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 5 29,305 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 494.58 0.50 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 7,302.26 3.50 - 3 19,350 GLAXO SMITHKLINE CONSUMER NIG. PLC. 7,534.02 6.30 - 68 2,597,332 MAY & BAKER NIGERIA PLC. 3,381.46 1.96 - 4 37,925 835.63 0.44 10.00 24 1,074,817 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 99 3,729,424 104 3,758,729 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 888.00 0.25 8.70 9 6,871,964 9 6,871,964 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 486.00 4.50 - 0 0 TRIPPLE GEE AND COMPANY PLC. 316.77 0.64 - 0 0 0 0 PROCESSING SYSTEMS CHAMS PLC 1,314.90 0.28 3.70 31 4,057,231 E-TRANZACT INTERNATIONAL PLC 9,996.00 2.38 - 0 0 31 4,057,231 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,122,935.67 298.80 - 9 13,378 9 13,378 49 10,942,573 BUILDING MATERIALS BERGER PAINTS PLC 2,173.68 7.50 - 8 41,445 CAP PLC 17,010.00 24.30 - 38 612,605 CEMENT CO. OF NORTH.NIG. PLC 262,870.02 20.00 - 34 371,842 MEYER PLC. 313.43 0.59 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 2.23 - 0 0 1,156.20 9.40 - 0 0 PREMIER PAINTS PLC. 80 1,025,892 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 2,395.40 1.36 - 18 758,856 18 758,856 PACKAGING/CONTAINERS BETA GLASS PLC. 26,898.49 53.80 - 9 8,372 GREIF NIGERIA PLC 388.02 9.10 - 0 0 9 8,372 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 107 1,793,120 CHEMICALS B.O.C. GASES PLC. 2,547.42 6.12 - 2 1,700 2 1,700 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 2 2,500 2 2,500 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 83.60 0.38 - 2 405 2 405 6 4,605 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 28 5,200,000 28 5,200,000 INTEGRATED OIL AND GAS SERVICES OANDO PLC 44,753.08 3.60 -0.56 60 2,124,706 60 2,124,706 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 53,332.04 147.90 - 14 7,035 CONOIL PLC 10,686.86 15.40 - 20 162,882 ETERNA PLC. 3,651.61 2.80 - 20 268,250 FORTE OIL PLC. 20,709.45 15.90 - 51 106,175 MRS OIL NIGERIA PLC. 4,663.23 15.30 - 3 2,418 TOTAL NIGERIA PLC. 37,652.97 110.90 - 23 24,520 131 571,280 219 7,895,986 ADVERTISING AFROMEDIA PLC 1,642.45 0.37 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 17,551.17 1.80 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 270.56 0.23 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,623.26 4.45 - 1 1,500 TRANS-NATIONWIDE EXPRESS PLC. 398.52 0.85 - 0 0 1 1,500 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,259.15 2.75 - 0 0 IKEJA HOTEL PLC 2,161.95 1.04 9.47 7 640,500 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 41,042.18 5.40 - 2 5,500 9 646,000 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,800.00 0.40 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 205.63 0.34 - 0 0 LEARN AFRICA PLC 817.74 1.06 - 2 6,459 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 1 500 UNIVERSITY PRESS PLC. 616.92 1.43 - 1 4,058 4 11,017 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 745.97 0.45 - 2 319,622 2 319,622

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BUSINESS DAY Tuesday 19 November 2019 www.businessday.ng

Roger Brown: The CEO designate of Seplat Michael Ani

oger Brown, the CEO designate of Seplat Petroleum Development Company Plc will be leading the Company in her latest aspirations when Austin Avuru, the current CEO steps down on July 31, 2020. SEPLAT Board favoured Roger as the company in line with its forward looking plans positions itself for a next phase growth ambition which would see the expansion of its footprint in terms of energy business activities, pursue offshore assets as well as opportunity driven entry into different geographies. Having played critical roles in the company’s successful landmark deals, Initial Public Offering (IPO) and financial structure of debt and acquisitions, as well as increased returns to shareholders, Roger who is very familiar with the local, and global business environments and institutions will be working towards fortifying this. Seplat believes that such a corporate transition which will see Roger take over from Avuru on July 31, 2020 would require a different kind of organisational structure, people skills set and mentality to compete well in the expanded space. In view of this, Seplat will be reviewing its current organisational and systems structure. The next stage which Roger will be leading requires a wide global business/transaction view requiring deep financial and capital markets knowledge and experience. These are what Roger brings to the transformational agenda of Seplat. While the company lives up to the globalization of its business, Roger will no doubt be supported by the local staff working with him in the successful company. Roger joined SEPLAT in 2013 as the CFO and played a key role in the successful dual listing of the Company in 2014 on both the London and Nigerian Stock Exchanges. Similarly, since joining the Company, he has played significant roles in various asset acquisitions by the Company. He brings to the CEO role, a deep knowledge of the Company in his 6 years as the CFO and a member of the Board. He has strong financial, commercial and Mergers and Acquisition (M&A) experience as well as proven people skills which will be an asset as the Company embarks on the next phase of its growth plan. Prior to joining SEPLAT,

Brown was an advisor to the Company since 2010 while he was the Managing Director and head of EMEA Oil and Gas at Standard Bank Group. During his time at the bank, he was instrumental in providing advice and deploying capital across the African continent in the Oil & Gas, Power & Infrastructure and the renewable energy sectors. For instance, the company’s 9 months profit of $185 million (2018: $91 million) was positively impacted by a 37percent year-on-year reduction in finance costs reflecting de-leveraging of the balance sheet early in the year when the outstanding balance on the 2022 revolving credit facility (RCF) was ultimately reduced to zero. SEPLAT CEO designate is a qualified Chartered Accountant from the Institute of Chartered Accountants of Scotland. The product of Belfast Royal Academy also holds MSc in Finance from University of Ulster; BSc (Hons) in Finance from University of Dundee. Roger joined Seplat and its board in July 2013, having previously been an advisor to the company since 2010, Roger set up the London office for the company prior to listing on the Nigerian and London Stock Exchanges (Main Board). During his time at the company he steered the business through extremely challenging times during low oil prices and an 18-month period when the business was not producing oil due to a shut in of its main oil pipeline. He also put in place a total of $1.75billion of financing which included an inaugural $350million Eurobond as well as bringing in a number of top tier banks into the syndicate. He is responsible for reporting, corporate finance, investor relations, enterprise risk management, internal audit, commercial negotiations / contracts and business development. He currently runs a team of 55 people. The Global group had some 70 professionals focused on the oil and gas. Roger headed the CEEMEA team based in London focusing on Debt, Mezzanine and Equity investments in the sector. In addition to capital, the group also provided structuring advice and M&A services to both buy side and sell side clients. Roger was a senior originator and structured all forms of financing for industry clients such as Project Finance, Structured Commodity Finance, Acquisition

Roger Brown

Finance, Corporate Lending and Debt Capital Markets. Key achievements: Was instrumental in up-tiering the banks positioning in the markets with clients and also originating and closing some high-profile transactions. Prior to focusing on the Oil and Gas sector, Roger previously led Standard Bank’s Renewable Energy and Power and Infrastructure teams based in London. As Senior Manager in the Project Finance Department at Price Waterhouse Coopers, London focusing on providing advice to governments and private sector developers in the UK and Middle East. At Coopers & Lybrand, he served as Manager in the corporate finance department focusing on servicing of multinational companies with offices in Singapore. At the Coopers & Lybrand Edinburgh, Brown was the Manager in the audit department focusing on manufacturing and industrial companies. His select deal experience Oil and Gas: Tullow Oil: $2.5 million RBL and $600 million corporate loan facility for Uganda - Mandated Lead

Arranger; Afren: $450 million RBL - Mandated Lead Arranger; Seplat: Lead advisor for Seplat’s IPO, one of the largest IPO’s in sub-Saharan Africa. Also lead a $250 million pre-IPO share disposal and various other advisory mandates; FHN: $180 million acquisition and development facility for the acquisition of OML 26 from Shell; Neconde: $470 million development facility for the refinancing of the acquisition of OML 42 from Shell; BP: $1.5 billion – managing the global account and responsible for various credit facilities; Socar – $250 million credit facilities for Socar Trading – Mandated Lead Arranger; Shoreline Natural Resources: $765 million guarantee and a $550 million bridge facility to acquire OML 30 from Shell – Lead Advisor and Arranger; Heritage Oil and Gas – Financial Advisor for sale of Miran Block to Genel; Ophir – syndicate member for the listing of Ophir on the Main Board of the London Stock Exchange; Heritage Oil and Gas - Sell side advisor. Approximate deal size $2billion; Confidential: Sell side advisor to a private oil

and Gas company in a merger with a major stock exchange listed Oil and Gas company; PUMA – $300 million acquisition of BP’s downstream assets in African – Mandated Lead Arranger; West African Gas Pipeline – $600 million adviser to the government of Ghana on its investment in the West African Gas Pipeline project and negotiation on the Gas Sales Agreement between WAPCO and VRA; and Adviser and Arranger on a 550km gas pipeline in Brazil. Others are: Essar - Arranger on a $2.0 billion refinery project in India; Gulmar Offshore - Mandated Lead Arranger for a $40 million financing for an oil services company in Sharja to acquire and upgrade a DP2 ship; Essar - Arranger of a $250 million facility to finance the upgrade of a semi-submersible oil rig; Power & Infrastructure –Jantus: Adviser and Arranger on a 220 MW wind farm in North East Brazil, under the Proinfa Programme. The farm is the largest in Latin America; Jantus: M&A mandate to dispose of a 51percent stake in a 200MW wind farm in North East Brazil, under the Proinfa

Programme; Adviser and Arranger on a 66MW Geothermal power plant in Nicaragua; HLC: Adviser and Arranger on a 128 MW thermal power plant in Ceara, North Eastern Brazil; Rurelec - Arranger on a 120MW combined cycle power plant in Argentina. The transaction includes the securitisation of carbon credits; EGSA - Arranger to provide acquisition financing to a UK company purchasing a majority stake in the largest electricity generator in Bolivia; CEC - Adviser and Arranger on a $100 mil leveraged buyout of a power transmission business in Zambia. The leveraged buyout was a ground breaking transaction on the African continent; Biodiesel Energy Trading - Adviser and Arranger of a 400,000MT biodiesel plant in Sines, Portugal. Standard Bank was an equity investor and MLA for the plant; Kladno - Arranger on a 340 MW coal and gas fired power plant in the Czech Republic; Equity provider for a start-up wave technology company in the UK; Equity provider for a leading fuel cell company in the UK; Adviser and Arranger on a 66MW thermal power plant in Mauritius; Adviser to a power transmission business in Zambia to raise equity and debt finance for the development of new expansion projects the company is pursuing; Arranger on a 500MW power project in South Africa developed by a UK listed power company; Arranger for a number of carbon credit portfolio financings. The financings range from upfront prepayments to discounted receivables; Adviser and Arranger and equity provider on a portfolio of wind farms in India. First stage financing was a 50MW wind farm developed in the Karnataka region; Prior to Joining Standard Bank Adviser to Minster of Energy in Oman in the development of a $200 mil power plant at Salalah, Oman; Adviser to Minster of Energy in Oman in the development of a waste water treatment plant in Muscat; Adviser to a UK developer on a $180 mil shadow toll road scheme; Adviser to the UK government on the $1.2 billion redevelopment of the MoD headquarters at Whitehall. At the time of closing the transaction was the largest ever PFI scheme; Adviser to the Ascot Authority on the construction of a new $290 million stadium at Ascot; Adviser to the UK government on the development of a $130 million waste water treatment facility.

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