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news you can trust I ** monDAY 23 DECEMBER 2019 I vol. 19, no 462
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For two weeks, TEMITAYO AYETOTO embedded herself with patients at the accident and emergency centres of two of Nigeria’s biggest tertiary hospitals, LUTH and LASUTH. She uncovers how a lack of bed space leaves patients stranded at the emergency ward for dozens of hours, oftentimes days. With the motto ‘no bed space’, patients suspend their destiny on the hope that an in-patient is discharged, transferred or, rather sadly, dies. When this will happen, though, they have no idea.
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NGUS DEC 30 2020 366.87
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The Lagos hospital wards of deadly wait (I) he loitering began mounting under the car-park shade, where I obser ved proceedings from afar. Frail patients in desperate hunt for ease and tired legs of anxious relatives and friends flanked the main entrance. There was only one wooden bench on which an assortment of medical troubles squeezed in a row. It was Tuesday, November 12, at the Accident and Emergency (A&E) Ward of the Lagos University Teaching Hospital (LUTH), Lagos. Beyond the glass-door usherContinues on page 41
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Global recognition for Glo at World Branding Awards
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lobal celebration came the way of Nigeria’s digital transformation leader, Globacom, recently as it was adjudged the “Brand of the Year 2019-2020 in Telecommunications –Mobile” at the 2019 World Branding Awards held at the Kensington Palace, London. The recognition, according to the Chief Executive Officer of the World Branding Forum (WBF), Peter Pek, followed a rigorous assessment based on three parameters – brand valuation, consumer market research and public online voting. Explaining further, Pek said brand evaluation accounted for Continues on page 43
Inside L-R: Victor Etuokwu, board member, Aspire Coronation Trust (ACT) Foundation; Osayi Alile, CEO, ACT Foundation; Tunde Folawiyo, chairman, ACT Foundation; Herbert Wigwe, GMD/CEO, Access Bank plc; Omobola Johnson, board member, ACT Foundation, and Clare Omatseye, board member, ACT Foundation, during the foundation’s courtesy visit to Access Bank plc in Lagos. Pic by Olawale Amoo
CBN slashes bank charges in revised guidelines
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Minimum wage: Oyo sets up committee to dialogue with workers REMI FEYISIPO, Ibadan
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overnor Seyi Makinde of Oyo State said weekend that his government was on the same page with civil servants on the new N30,000 minimum wage for workers. The governor, who noted that his administration had set up a committee to oversee the negotiation and implementation of the new minimum wage, stated that civil servants and the government were going to be reasonable on the all-important matter. The governor alerted the people to a number of noticeable achievements and deliverables recorded by his administration within the last 200 days, just as he informed that his administration was able to deliver so far due to prudent management of resources. Besides, he also said his administration had been making sacrifices, as service to the people had been of uppermost concern. He stated that his government had never kept the organised Labour in the state and all stakeholders in dark over the resources accruing to the state. He said though the state was already aware of the cost implication of the new minimum wage, the government and the civil servants would be reasonable because they were heading in the same direction of delivering good governance and development to the state. He made the disclosure during the quarterly live interview programme, Meet the Governor, on the Broadcasting Corporation of Oyo State (BCOS). The governor, who addressed a wide range of issues raised by the three-man panel of interviewers and residents of the states who made phone calls into the programme, said though the government had been getting a good report about security in the state following immense efforts of the administration in redesigning the security architecture; distribution of security vehicles and procurement of communication equipment, among other steps, it was not going to rest on its oars. He commended the security agents saddled with the responsibility of policing the state and the people for their cooperation, noting that statistics have shown that the state has recorded the lowest crime rates in this Yuletide period. He stated that the development was a confirmation of the fact that his administration has taken security a notch higher in the state. He said: “On the minimum wage issue, yesterday (Friday), we set up the committee that will engage with the Nigeria Labour Congress. The truth is, if we don’t deceive ourselves, everyone will be reasonable. NLC too knows that we are open with the amount of money we are getting as federal allocation. That is why we are in harmony.
Nigeria Immigration sets for implementation of Visa on Arrival Policy, says Comptroller-General Adeola Ajakaiye, in Kano
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igeria Immigration Service (NIS) says it has put necessary machinery in place for the commencement of Visa Application Process for all Business travellers and African Union Countries on Arrival Policy, which comes into effect next month (January). In preparation for the takeoff of the policy, the Service reveals that it has segmented the Visa requirement into 75 categories, in order to smoothen the implementation of the
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policy, which it set to do without compromising National Security. The Visa on Arrival is applicable to citizens of all countries except ECOWAS Nationals, who do not require visa to visit Nigeria and other countries Nigeria has entered into visa abolition agreement. Muhammad Babandede, comptroller-general of Immigration, disclosed this weekend, while presiding over the passing of 509 officer graduands of the 3rd Conversion Course of the Immigration Training School Kano. Babandede expressed the
readiness of the Service to vigorously implement the policy, which according to him, is expected to have revolutionary impact on the country, particularly, as it concern doing business. “It is a known fact that Mr. President gave the directive about eight months ago on the Visa on Arrival Policy of the Federal Government, which is expected to start in January next year. We have put in place all necessary machineries in motion for the take of the policy. “So far, 75 categories of new Visa Procedures have been created which the Service will be
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implementing without compromising National Security. We wish to commend Mr. President for the revolutionary impact that the policy will be having on doing business in the country,” he noted. Commenting on the ongoing Migrant E-Registration the Service is executing in the country, the comptroller-general stated that the registration was scheduled to end also next month, January. He called on all Migrants in the country to ensure that they got registered before the expiration of the grace period provided by government in
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order to avoid the negative consequences that might follow their non-compliance. Speaking on the training, he explained that the programme was conceived to equip the participants with professional knowledge, skills and competencies that would make them function better in their various assigned responsibilities. He reiterated the commitment of the management of the Service to continue investment in the training of personnel, as part of the on-going initiative geared at re-branding the Service, and make it more functional.
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Lady maiden Ibru’s 70th birthday and my lucky (narrow) escape (2)
Bashorun J.K Randle
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e threw up his arms and demanded: “Why should Nigerians lose their lives during elections or be sold as slaves in Libya? To our shame, young people (including doctors and chartered accountants) are leaving the country in droves. Some have even resorted to crossing the Sahara Desert or swimming across rivers/seas in a desperate pursuit of better lives in Europe. As for the womenfolk, many of them are pounding the streets of France and Italy as prostitutes and drug traffickers. Christ is our peace. He has reconciled us to God; in one body by the cross. We meet in His name and share His peace. The peace of the Lord be always with you.” Even the non-believers (names withheld) in the congregation were severely jolted. Only time will tell if they would mend their ways and repent. If they do, then they owe their salvation to the preacher and their redemption to Lady Maiden Ibru. What followed were fulsome encomiums and bountiful accolades which were showered on
the birthday girl for her fierce determination to preserve the memory of her beloved husband having become a window and single parent at the age of sixty-two years with young adults to look after – Tivi, Toke, Anita, Uvie and Ose. The Bishop described Maiden as a magnet who has drawn together a wide circle of friends to whom she is exceptionally devoted and uncommonly loyal. Furthermore, under her leadership, “The Guardian” newspaper was the only national paper (print or electronic media) which was not tainted by the sleaze and corruption of “Dasukigate” – with billions being doled out to media organisations by the National Security Adviser under the last government. While directing his gaze at the birthday girl, the Bishop declared: “The Lord has been faithful and steadfast. Take my life and let it be consecrated, Lord, to thee. My God, how wonderful thou art. Thy majesty how bright.” As for the “Alleluia Chorus”, it was heavenly. Before matters were concluded, the Bishop acknowledged the presence of “KCOBs” (King’s College Old Boys). This was in addition to thanking the following dignitaries: Lieutenant-General T.Y. Danjuma GCON and his wife Senator Daisy Danjuma for their generous support to the Anglican Church and welfare of the clergy in addition to massive donations to universities, provision of health facilities, potable water and huge contributions to the poor and internally displaced people (IDPs) especially in the North-East – through the Danjuma Foundation. Awesome. The General did not mince words when he felt compelled to warn his kith and kin in Taraba State that they were in imminent danger of being
wiped out. At the head of the fairly long list were The governor of Edo State, Godwin Obaseki; The governor of Delta State, Senator Ifeanyi Okowa; Senator (Mrs.) Oluremi Tinubu (former first Lady of Lagos State); Aremo Olusegun Osoba (former Governor of Ogun State) and his wife Erelu Derin. The thanksgiving service was clearly a masterpiece. It was evident that the congregation were in no hurry to exit – even after the recessional hymn. What followed were photographs with the birthday girl basking in the afterglow of communicating with the Almighty. What was now on offer was Maiden the fashionista, giving the paparazzi every shot or angle they asked for. Finally, she waded through the crowd of admirers and well-wishers into the ample embrace of a vintage Rolls Royce with her nephew-in-law Olorogun Oscar Ibru ready to accompany her to the shindig at the Federal Palace Hotel which belonged to her late husband Alex. Before I could exit, Most Reverend Dr. Yinka Omololu (name withheld), previously a surgeon in the Nigerian Navy (with the rank of Commodore) and an avid squash player reminded me that having retired from the clergy he was at the Church service incognito but he wanted me to know that he is fully in support of building a wall around Lagos – to be paid for by Donald Trump, President of the United States of America. Once the wall is built, all the J.K. Randle property which the government had demolished or seized – Chief J.K. Randle Memorial Hall; Dr. J.K. Randle Swimming Pool; The Love Garden (now known as The MUSON Centre) etc. would be returned to the family.
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The thanksgiving service was clearly a masterpiece. It was evident that the congregation were in no hurry to exit – even after the recessional hymn. What followed were photographs with the birthday girl basking in the afterglow of communicating with the Almighty
Randle is Chairman/Chief Executive JK Randle Professional Services Chartered Accountants
Nnimmo TEMI Bassey BAMGBOSE
Is technology against press freedom in Nigeria?
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ne fateful day 33 years ago, on October 19, 1986, one of the strongest voices in the Nigeria media was brutally silenced. Dele Giwa, the then editor of Newswatch magazine, had received a mail which exploded and wounded him fatally on opening it. Giwa may not have been the first journalist to pay the ultimate price because of his work as a journalist, but he was the first in Nigeria to be killed with such technology. The intrigues that led up to the journalist’s death also involved technology such as wiretapping and bugging that was relatively new to the country at that time. Notwithstanding the cruel killing of Dele Giwa, the nation’s press has not relented, and so has its persecutors remained resolute with their persecution. In the last 30 years, hundreds if not thousands of clamp-downs have been unleashed on the press both as individuals and as organisations. According to Premium Times Centre for Investigative Journalism’s Press Attack Tracker, over 300 incidents have been recorded, putting the average at 10 per annum less unreported incidents. While some of these attacks are carried out by groups or individuals rattled by media reports, many others are done by political powers and agencies wielding extra judicial state authority with impunity. More recent attacks are not only aimed at intimidating journalists through physical and emotional abuse, they are also targeted at getting to their sources, perhaps to silence them all together, using advanced forensic technology. Bukola Adedigba of Premium Times newspaper was a victim of this brand of attack. After
several threats and false accusations in August, 2019, Adedigba honoured an invitation to the police station. Amidst vicious rough handling on arrival, the officers promptly dispossessed her of her Gionee X6 phone and for the next four hours the phone was taken away. “Obviously, my phone was their main target,” Adedigba said. “When they returned to where I was kept, they came with my phone asking questions about my contact on the phone.” Thereafter the harassment died down. Nothing was ever mentioned about “criminal conspiracy, cybercrime, attempted kidnapping and fraudulent act,” trumped-up charges, on which she was initially invited. She hardly touches the phone anymore on suspicion that spywares may have been installed on it. Daily Trust’s Hamzat Idris and Uthman Abubakar had a similar but farther-reaching experience earlier. Idris described it as a siege on the newspaper’s corporate headquarters in Abuja, Nigeria’s capital in January, 2019. “I was the politics editor at the time,” Idris recounted. “My colleague and I authored a story, I think the headline is something like “Military plans to retake Baga from Boko Haram” and they found it offensive.” The military, along with the police and the Department of State Security, stormed the newspaper’s office seizing several desktop and laptop computers. Abubakar was arrested. His two phones, along with his computer, was seized. But Idris narrowly escaped. After several weeks of holding on to them, the computers were finally returned to the newspaper. But the management knew better than to use the www.businessday.ng
systems again. “The ICT department in our company checked the systems and recommended that we should not use them anymore. The company spent a lot in buying new ones,” Idris revealed. Adedigba, Idris, Abubakar and many others whose journalistic equipment has been separated from them while in custody are sure that forensic scans intended on taking hold of information, especially about their sources, have been carried out on their phones. They have good reason to think so as their captors often interrogated them about their sources and contacts in addition to seizing their equipment. Advanced forensic technology capable of bypassing passwords and security on phones and computers are the prime exports of Israeli company, Cellebrite and U.S.-based company, AccessData to Nigeria, a report by the Community to Protect Journalists (CPJ) revealed. One of the case studies on the Israeli company’s website tells about a “Nigerian drug lord” who was apprehended using metadata from photos obviously taken with his phone. An individual within the country’s law enforcement who is concerned about the possible misuse of the forensic technologies told CPJ that security forces use Universal Forensic Extraction Device (UFED) and Forensic Toolkit (FTK) to retrieve information from devices. The fear of possible misuse -- for gagging the press and its sources -- are not unfounded. In December 2017, two Reuters journalists, Wa Lone and Kyaw Soe Oo, were arrested and imprisoned for more than 500 days by Myanmar Police on the accusation that they possessed
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Meanwhile, His Royal Majesty Oba Rilwan Akiolu has issued a proclamation on that day to be conveyed to all Lagosians via Town Criers in accordance with the traditions of Lagos when turbulence is brewing: As the year 2019 draws to a close, the level of poverty is worrisome. • There is virtue in contentment. • History has taught us that when the King’s horse is missing, among the search party are those who are genuinely hoping that the horse would be found while there may be others who would be hoping that the horse would never be found (lost forever). In between are those who are praying that wherever the horse is, it should be in comfortable surroundings and not lack for food. • Integrity is far more valuable than money • All Lagosians must shun insincerity, greed and other social vices. • In view of the deteriorating security situation in the country, Lagosians should make it a point of duty to be in their homes no later than 9pm (“Isede”). Although Kabiyesi (a devout moslem) was not in church, he sent word – quoting from the Bible: “What shall it profit a man (or woman) to own the world and lose his (or her) soul.” Let the party begin. When the old boys of St. Gregory’s College (names withheld) lurking around the forecourt of the church offered me a ride to the after-church reception, I beat a retreat into the church and exited through the back door. It seemed rather odd that all of them wore dark glasses even though it was getting dark.
state secrets with the intention of using it. At the time of their arrests, they had been working on an investigation into the killing of 10 Rohingya Muslim men and boys in a village in Myanmar’s Rakhine state. The documents used against them in court were pulled from their phone using Cellebrite’s technology, The Washington Post reported citing the defence lawyer’s account. Access to these kinds of technology, along with the impending Social Media bill, sponsored by Senator Muhammad Sani Musa and the Hate Speech bill by Senator Abdullahi Aliyu Sabi would make a dreadfully formidable combination for gagging free press in the country with over 181 million people. Out of its 59 years of existence as a country, Nigeria has had 29 years of military rule. In the last 20 years, two (including the sitting president) of the four democratically elected presidents of the country have ruled in the past as military heads of state. Despite the relative freedom the press has enjoyed since the end of military rule in 1999, the indications currently are still ominous. Along with Adedigba, Idris and Abubakar; Samuel Ogundipe, Abiri Jones, Agba Jalingo and many others who have been imprisoned and harassed for doing their jobs as journalists understand it better. Reflecting on the whole situation and fearing eventualities like Dele Giwa, one would agree with Idris who sums it up as very sad and dangerous. It portends doom for credible journalism, including privacy of journalists which are key to a free society and to holding regimes to account.
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Partnerships: Preparing Nigeria for the future of work Polly Alakija
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n Nigeria, the average expected years of schooling is 10 years, covering only primary and secondary education. About 15 million children are out of school, primarily because their parents cannot afford the tuition, amongst other things. Primary school completion rate, accord-
ing to data available from Takwimu Africa, is currently at 66 percent. Nigeria’s Economic Recovery and Growth Plan (ERGP) takes note of the challenges with the education system, especially limited access to and quality of basic education, limited provision of STEM education; inadequate facilities at all levels of education; and lack of structured and quality programmes for technical education. These issues, if not urgently resolved, may limit Nigeria’s capacity to actively participate in the future of work. The challenges of Nigeria’s education system seem enormous and almost impossible to completely address, and the woes of poor governance in Nigeria have been the topic of many debates and discussions. While valid, these debates have taken our attention of the more important issue –removing the obstacles that make our society less habitable for future generations - a feat that can only be achieved through collaboration for sustainable development. With the right partnerships, we can eliminate the barriers to quality education and prepare the next generation for the future of work. Across Nigeria, development actors are working tirelessly to bridge the gaps across critical areas of education. Five Cowr ies Initiative is one of
such programmes deploying a d i f f e re nt ap p roa ch to a d dressing education needs, in order to change this narrative. The Nigeria-focused education programme is working in partnership with Teach For Nigeria (TFN) and other partners, within the private and public sectors, to introduce creative, arts-based teaching methods and resources to improve school attendance and outcomes, for participation in STEM courses. Children are taught that learning is fun, and they can have their own voice, which is important for increased self-esteem and decision making. The Five Cowries Initiative supports 2,000 children each year, in collaboration with its other dedicated partners locally and internationally, to deliver programmes that improve education and engage children with issues of social and global impact - from conser vation, citizenship, and health, to migration, new technologies and pollution. In partnership with Forte Oil, Five Cowries is using the arts to improve learning in the sciences. The partners commissioned ‘My Story of Energy’ early in 2019 to encourage STEM participation. Through the visual arts, students learn the basics of science and its import for dayto-day activities within nature and the environment. Through the project, Forte Oil and Five
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The challenges of Nigeria’s education system seem enormous and almost impossible to completely address, and the woes of poor governance in Nigeria have been the topic of many debates and discussions
Alakija, festival director, art programme mentor and curator.
Where will all that liquidity go?
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t has been a few weeks since the Central Bank of Nigeria released a series of circulars that turned the securities market on its head. If you recall the central bank announced restrictions on who could or could not purchase its CBN bills in both the primary and secondary markets. Banks and foreign portfolio funds were allowed while non-bank corporates and individuals were banned. Notably, pension funds who had previously been a big buyer of CBN Bills were booted out of the market. No real explanation was given for the sudden change in policy besides the generic “we are doing this to stimulate lending to the real sector” line. My words, not theirs. Of course, the CBN has the right to decide who can or cannot buy its own instruments but it does not have the right to determine who can or cannot buy national treasury bills and federal government bond. In summary, the market for risk-free short-term securities were effectively split into two with one set of securities sold to the CBN favoured buyers and the other a free for all. I predicted in my earlier column from a while ago that this would result
in two different prices for essentially the same risk-free securities. Indeed, the interest rates on national treasury bills, the security that everyone can buy, has collapsed. The interest rates on similar CBN bills have remained stubbornly high. But you already knew this. What is new is the continuing signal of a flood of liquidity looking for parking spots. Since the CBN announced its change in policy the demand for its CBN bills has dried up with the CBN not able to sell all it wanted at almost all of its auctions. On the other hand, the demand for treasury bills has been immense even at the low rates. Treasury bill auctions have been over-subscribed at levels not seen for a very long time. What this means is people have cash to buy treasury bills but cannot because the debt management office is not willing to divert from its debt strategy. People would like to buy CBN bills but the CBN is not budging. There was some hope that people would turn to the Nigerian Stock Exchange and jump into the equities market. Despite a very short lived and small rally the NSE has not been the safe haven. It seems like buyers are www.businessday.ng
Cowries provide teachers with on-the-job training to help introduce arts-based teaching methodologies, while also providing the materials needed, and which the schools cannot afford to provide. Participating children from public schools in Lagos State, take part in science projects, and are challenged to showcase their learnings through artworks painted on the walls of Forte Oil’s petroleum stations. At the end of the programmes, the students receive certificates as marks of achievement, which they can show to parents to encourage willingness and support for their children’s continued education. While this seems peculiar as an instance, the principle remains the same – collective effort that leverages existing technology and resources, is critical for solving developmental issues. Without individual or organisational partnerships, we may be unable to reach the hard-to-reach areas or achieve our objectives, talk-less of surpassing them. As a result, while private partnerships cannot and should not be a replacement for governance, it can be a stop-gap to provide some of the much-needed resources required to give children the opportunity at an education.
ECONOMIST not too keen given the harsh realities in the Nigerian economy and the lack of confidence in many companies on the board. Even despite their alleged “undervaluation”. No one really wants to lose money after all. Another option would have been for these buyers to take advantage of banks and just park the money there. Typically, if all else fails then a fixed deposit account should provide some modest return and still be relatively safe. Rumours are however rife that banks do not really want that money. Fixed deposit rates have allegedly fallen so low that it essentially identical to saying, “do not bring your money here”. This is probably due to the minimum loan to deposit ratio policy with banks set to be penalized at the end of December if they do not hit the 65 percent target. And the punishment increases with deposits. What this all means is there looks to be a build-up of liquidity with no obvious place for it to go. If you add the context that inflation is currently looking like it will hit 12 percent early next year then all the liquidity is a problem. Where will it go? There is one asset that excess liquidity tends to chase
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NONSO OBIKILI
when times are tough, and people don’t know what to buy. In deo speramus. But does the CBN really want that? I guess we will have to wait and see. In unrelated news, has anyone heard from the economic advisory council? Should we declare them missing and put out an APB alert? Just asking for a friend. Dr. Obikili is the chief economist at Business Day
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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
GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu HEAD, HUMAN RESOURCES Adeola Obisesan
36 years of searching for solution to Lagos traffic crisis
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o Nigerians especially Lagosians, it’s strange, yet true that Lagos State, the selfstyled Centre of Excellence in Nigeria, has been searching for solution to its trade mark traffic crisis since the last 36 years without success. Lagos which is addressed in superlative terms as the largest economy in West Africa; one of the fastest growing cities in the world, a mega city and one of the 100 resilient cities in the world. But it easily and pitiably falls flat when the cards are laid out on the table. A major card is gridlock; another is misery which is quite deep. Precisely on July 16, 1983, Lateef Kayode Jakande, the first civilian governor of the state (1979-1983) flagged off the Lagos Metro Line project projected to cost N689 million. It was a major attempt at introducing an intra-city rail system as a response to the state’s traffic crisis. A few years earlier, the March 29, 1978 edition of Daily Times had hit the newsstand with a screaming headline, “Lagos Traffic Defies Solution” with a rider – “chaos despite new measure”, meaning that Lagos has known traffic crisis for more than 40 years today. “We are making history today. One hundred years from now, generations yet unborn would thank us for the wisdom
in establishing this project. At that time, the metro line would have expanded from the north-south route of Lagos to other states. I dream of a comfortable future and I thank God for making me and this administration instruments for this future,” Jakande said at the flag –off event. But the visionary governor was mistaken and unfortunately his dream was dashed following the military coup of 1983 which saw the junta, led by then General Muhammadu Buhari, which overthrew the civilian administration of then President Shehu Shagari and Governor Jakande. Consequentially, generations yet unborn have no reason to thank him and his administration for the wisdom in establishing the project that never was. The administration had planned to execute the metro line project in two phases, with the first starting from the Marina to Yaba. This phase was slated for completion in July 1986, while the second, commencing from Agege to Yaba through Oregun and Ikorodu Expressway, was slated for completion in March, 1987. Till date, Lagos has experimented on one measure after another in an attempt to tame the monster called traffic gridlock to no avail. The population of the state has more than doubled along with growing number of vehicles, but infrastructure has remained almost static.
It is sad that with a vehicular density of over 222 vehicles/km, Lagos has largely unplanned network of roads which, in the last five years, have become landmines with deep gullies and yawning craters. Though successive governments in the state, especially the administration of Babatunde Fashola, have made some attempts at containing the challenge of traffic in the state, these attempts have not yielded tangle, measurable and sustainable results. It is sad to note that whatever were the merits or achievements of the traffic law in its early days have been diminished by the traffic realities in the state today. It seems as though the state never had any such law in place. LASTMA which came out smoking with some level of positive results soon became an octopus, assuming larger than life image and extorting motorists on spurious charges, leading to its widespread condemnation. Traffic wardens are a rare sight while LASTMA officials are overwhelmed as Lagos traffic congestion worsens daily. This in our view creates opportunities for new hires who can be trained to control traffic situations. However, what we see now are touts in their numbers taking up responsibilities of traffic officials in ways they deem fit. Lawlessness in road conduct among drivers and riders is now
the order of the day. “One way” which should be frowned at and have its offenders brought to book is now the norm, as drivers try to beat traffic. Regular motorcycles as an alternative means, has solved to an extent the menace however created new challenges as they are the perpetrators who ply the one-way route and drive at full speed thereby exposing people to the risk of accident. However, this isn’t the case with the likes of Gokada, Opay etc. who ride in line with traffic regulations. It has become unbearable to live in the state and this was reflected in the ranking of the state as the third most miserable city in the world by an international ranking organisation. We are alarmed by the rise in travel time and cost which have gone up by over 1000 percent. Apart from impoverishing the residents, the traffic crisis situation is also diminishing the economy of the state as it affects productivity significantly from the level of artisans to CEOs in the corporate world. We are of the view that that for so long as the state government shies away from creating new city centres in places like Ikorodu, Badagry, Abule Egba and other far-flung suburbs, so long will everybody find their way to the already congested Ikeja, Ikoyi and VI, and for so long too will this crisis endure.
EDITORIAL ADVISORY BOARD Imo Itsueli Mohammed Hayatudeen Afolabi Oladele Vincent Maduka Opeyemi Agbaje Amina Oyagbola Bolanle Onagoruwa Fola Laoye Chuka Mordi Mezuo Nwuneli Charles Anudu Tunji Adegbesan Eyo Ekpo Wiebe Boer Paul Arinze Boye Olusanya Ayo Gbeleyi Haruna Jalo-Waziri Clement Isong
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BUSINESS DAY
Monday 23 December 2019
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Buhari’s return to authoritarianism violates his vow to Nigerians global Perspectives
OLU FASAN
I
n May 2015, Colin Freeman, the chief foreign correspondent the London Telegraph newspaper wrote a piece entitled “Nigeria’s Buhari: from military dictator to ‘converted democrat’”. Freeman recalled General Muhammadu Buhari’s hardman habits as a military dictator between 1983 and 1985 but noted Buhari’s speech in February 2015 at London’s Chatham House in which he presented himself as a changed person. In that famous speech, Buhari said: “I cannot change the past, but I can change the present and the future,” adding: “So, before you is a former military ruler and a converted democrat who is ready to operate under democratic norms”. Freeman posited: “In the eyes of many Nigerians, General Buhari is just the kind of politician that the country should have moved on from years ago” but added that “many Nigerians were willing to give him a second chance.” Of course, Nigerians gave Buhari – a brutal military dictator – a second chance in 2015, having rejected him in three previous elections, in part, because of the prevailing circumstances in the country at the time, but also because he promised to be a changed man. Surely, by describing himself as a “converted democrat” and later dropping the use of his military rank once elected president, Buhari sent a powerful signal of his intent to renounce his old hardman habits and embrace genuine democratic values or, as he put it, “operate under democratic norms”! In May 2015, after Buhari was sworn in as president, the presidency issued a statement saying that Buhari should no longer be referred to as Major General, while his vice president, Yemi Osinbajo,
should continue to be addressed as Professor! I remember writing in this column, wondering why Buhari was ashamed to be addressed as Major General while Osinbajo was proud to be called Professor. After all, I said, General Dwight Eisenhower, 34th president of the US, and General Charles de Gaulle, a post-war president of France, to whom Buhari was compared by his supporters, used their military ranks as presidents. But, in truth, there were key differences between Buhari and the two famous generals. Unlike Eisenhower and de Gaulle, who never overthrew a democratically elected government in their respective countries or brutalised their own people, Buhari toppled the elected government of President Shehu Shagari in 1983 and ran a very draconian regime that jailed journalists, closed newspapers and executed people for minor drug offences. So, it was understandable why Buhari didn’t want to use his military rank as president. To be called Major General Buhari in office, despite his record as a brutal military dictator, would have tarnished the sacredness of the elected office of president! Yet, as it turned out, calling himself a “converted democrat” and dropping the use of his military rank as president was a triumph of symbolism over substance. It was merely presentational and nothing more, because he returned to his hardman habits in office. During this year’s general election, I wrote a column entitled “Buhari: The deception of a “converted democrat” (BusinessDay, February 4, 2019) in response to Buhari’s authoritarian actions that threatened the integrity of the polls. Recently, President Buhari’s continued disregard for the rule of law has provoked similar reactions across the country. In an editorial entitled “Mr President, this is not 1985” (BusinessDay, December 13, 2019), this newspaper catalogued the abuses under the Buhari administration and noted that “Since coming to power in 2015, President Buhari has walked back on virtually all the promises he made to Nigerians and even the international community.” The Punch newspaper
went further by declaring that it would henceforth prefix President Buhari’s name with his military rank of MajorGeneral and refer to his administration as a regime. In an editorial entitled “Buhari’s lawlessness: Our stand” (Punch, December 11, 2019), the newspaper said it would refer to the president and his government in those militaristic and pejorative terms “until they purge themselves of their insufferable contempt for the rule of law.” Of course, everyone should have seen this coming. It was indeed a mistake to have taken at face value Buhari’s promise to operate under democratic norms, which include respect for the rule of law, judicial independence and free speech. After all, as the saying goes, a leopard never changes its spots. Or, as the American writer Gary Pauben put it, “You can take the man out of the woods, but you can’t take the woods out of the man”. The Times newspaper in London once said that dictators who become “democrats” tend to “eat out democracy from within”, adding that they “operate according to their own rules”. Truth is, Buhari fits the above characterisation. He is running Nigeria today as a civilian president almost the way he ran it as a military dictator. On the economy, it’s the return of the old Buharinomics: rabid protectionism. Indeed, as the Financial Times said of the recent border closure, “the blockade echoes one that Mr Buhari instituted as military dictator in the 1980s”. On the political front, Buhari’s refusal to countenance any political reform, let alone restructuring, is redolent of his intolerance of political dialogue during his military regime. And, of course, his harsh treatments of journalists, critics and the judiciary today are similar to the ways he treated them as a military dictator, when he curtailed the powers of the courts and arbitrarily jailed journalists and closed newspaper houses! So, then, it’s deja vu all over again: we’ve all been here before! The difference, however, is that the current dispensation is supposed to be a democracy, a military regime. And, thus, Buhari is expected to respect democratic norms, which include legality
‘
Everyone should have seen this coming. It was indeed a mistake to have taken at face value Buhari’s promise to operate under democratic norms, which include respect for the rule of law, judicial independence and free speech. After all, as the saying goes, a leopard never changes its spots
Dr. Fasan, a London-based lawyer and political economist, is a Visiting Fellow at the London School of Economics. e-mail: o.fasan@lse.ac.uk, twitter account: @olu_fasan
Whose money is it?
T
here is some euphoria that washes over many entrepreneurs when they get that message beep on their phone. The credit alert! I think it is a feeling of accomplishment, winning; maybe breakthrough? It is a very potent feeling. What comes afterwards is an almost automatic need to spend the money. Then the spending begins, most times without pre-meditation. Is it wrong to spend money when you get it? Of course not! The germane questions are; what should you spend on? Is it yours to spend? Whose money is it? Permit me to illustrate: Dayniton Enterprises sells wooden doors to estate developers. He just received a credit alert of N1.2million, bringing his previously low bank account balance to N1.3million. He immediately sends N900,000 to his travel agent to purchase an airline ticket and pay for 4 nights stay at a hotel in Dubai. He needs some rest and recreation because the stress has been enormous. At the end of the month, his staff salaries of N200,000 fall due, as well as his supplier’s invoice of N800,000. Sadly, there was no additional inflow into the account that month after the earlier referenced
Nnimmo JOVITA Bassey MADOJEMU
N1.2 million. There are many things to make of this situation, but I will hit the crux of the matter: the N900,000.00 travel expense by the MD was ill-timed. It is glaring that the N1.2million received into the bank account that month, was not his to spend. It was actually money to settle his supplier invoice and his staff salaries. This is a very familiar situation. It is possible that he genuinely forgot his obligations, and it is also possible that he remembered but could not be bothered. You see, I strongly opine that business is a vehicle run on trust. Every stakeholder engaged in your business has expectations and hopes that you will continually meet those expectations, even if you cannot exceed them. Your suppliers, employees and even your customers hope that you will continue to be in business. Therefore, as a business owner, you must mentally and psychologically prepare yourself to constantly confront the choice of delaying gratification to keep operations running, or appeasing yourself and crippling operations temporarily or permanently. It becomes absolutely critical that funds are allocated in such a way that operations keep running, so that revenue can also be generated unencumbered, to the benefit of all stakeholders. www.businessday.ng
and the rule of law, freedom of speech, the right to peaceful agitation, etc. The 19th century political philosopher Alexis de Tocqueville famously said that “The discourse of crisis is the native language of any genuine democracy”. But General Buhari does not believe in dialogue. His reflex response to any form of agitation is to use military force. He once ordered the military to “fight and destroy relentlessly” those agitating for self-determination. Centuries ago, the great Roman philosopher Cicero warned us to “beware the leader who sets aside the rule of law claiming the need for security”. But that’s exactly what Buhari is doing, by subordinating the rule of law to national security and the national interest, as he defines them. This year alone, there have been 61 cases of attacks on journalists, with some charged with treason for criticising the government and advocating peaceful change or, as the activist and former presidential candidate Omoyele Sowore called it, “revolution”. Recently, over 100 security personnel invaded the Federal High Court in Abuja to forcefully re-arrest Sowore, despite being granted a bail by the court. According to Amnesty International, President Buhari has disobeyed over 40 court orders in five years. Let’s face it, although General Buhari said he was a “converted democrat” and vowed to “operate under democratic norms, the truth is that he did not really make that transition “from a military hardman to a converted democrat”, as the Telegraph writer suggested. If Buhari was ever a converted democrat, his authoritarian recidivism shows that the conversion was superficial. Truth is, Nigerians gave Buhari a second chance partly because he promised to renounce his past authoritarian habits and embrace democratic norms. Sadly, he has broken that promise. But Nigerians must hold his feet to the fire and not relent until he keeps the vow and starts respecting the rule of law!
How then can an honest entrepreneur do better in resource allocation? The first course of action is accounting automation. This way you do not have to rely on your memory or several stacks of notebooks to monitor imminent obligations. With best-in-class accounting software, regularly updated with transaction posting, you can see your obligations at a glance in a Balance Sheet report at the click of a button. This keeps you constantly apprised of the payables and you can even track due dates for each supplier invoice. Notable software used by young and growing businesses all over the world includes Sage Business Cloud, QuickBooks Pro, Xero Accounting amongst others. Secondly, you need to work with cash flow forecasts. This can be very reliable, especially if you say that you do not have creditors and so you do not necessarily have to owe people. The cash flow forecast is usually prepared in advance. Some businesses prepare them in advance to cover three months or a full year. It is a plan of your expected cash inflows and cash outflows. What this does for you is that by the time you get those credit alerts, you refer to the cash flow forecast to see the items you have planned to spend on, and you utilize the business funds accordingly.
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A proper cash flow forecast will also plan for the entrepreneur’s compensation. This way, at the right time, he can get the funds to go on that much needed vacation. It really is hectic running a business and many times you get to feel that you deserve so much more than the business is giving to you. You must however remember that if you take it all out at once, you are aborting the future of your business. Your employees do not want that. Their dependents are counting on them to continue to be in employment. The same goes for your suppliers and the customers who have become very comfortable doing business with you. Dear entrepreneur, the next time you get that credit alert, please pause and ask yourself, ‘whose money is it?’ Here’s to making your business immortal! Madojemu is the managing director of Pundit Bookkeeping Services; a company bridging the gap between emerging businesses and professionally prepared accounts. He seeks to empower young businesses with financial intelligence, for business growth and sustainability. Instagram @jovitamadojemu, @punditbk Twitter @punditbk Email – jmadojemu@punditbookkeeping.com
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Monday 23 December 2019
BUSINESS DAY
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Monday 23 December 2019
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Monday 23 December 2019
BUSINESS DAY
In Association With
Johnson’s northern strategy
A Balkan betrayal Technology and society
To help England’s north, link it up
Public spending on transport in the north is barely half what it is in the south-east. That must change
H
AV I N G W O N scores of former Labour strongholds across the north of England in 2019’s general election, Boris Johnson is determined to offer his new voters something in return. “We will repay your trust,” he promised on a triumphant visit to his new turf on December 14th. Northerners have heard this kind of talk before. David Cameron’s government promised a “northern powerhouse” economy—only for the idea to fall by the wayside under Theresa May. After the Brexit referendum of 2016 there was much talk of the need to look after “left-behind” places that had voted Leave—instead the government spent three years focusing on its battles in Westminster. Yet with his newly remade Conservative Party, Mr Johnson relies on the north like no recent Tory leader (see article). If he is to keep his promise to improve life in the region, how should he go about it? The north of England has been in economic decline relative to the south since the late 19th century. That is not something any government can reverse in five years. But Mr Johnson means to make a start. His fiscal plans allow him to spend up to £80bn ($104bn), 3.8% of GDP, on capital projects in northern constituencies over the next five years. His first task is to jettison the idea, common in London, that the north is an economic monolith where everything is grim. Prosperous cities like Manchester, Liverpool and Newcastle are almost unrecognisable from two decades ago. In 2017 (the most recent year for which data are available) Newcastle and Liverpool enjoyed faster growth in gross value added, a measure of output, than the capital. In 2018, according to IBM, a computing
Pessimism v progress Contemporary worries about the impact of technology are part of a historical pattern
F
giant, Manchester and Liverpool were among the top ten cities in the world for inward foreign direct investment. The left-behind parts of the north are not its cities but its towns. Many have still not recovered from deindustrialisation under the Conservative governments of the 1980s. Their labour markets lag behind the rest of the country, with poor employment rates and lower wages. The clearest sign of this economic failure is that young residents are leaving. Towns like Redcar and Scunthorpe have seen the number of resident 18- to 24-year-olds fall by more than 20% since the 1980s, while the number of over-65s has risen by 30% or more. Ageing populations have cut local spending power and put pressure on stretched local-government budgets as the demand for social care rises. Northern towns are stalling even as their neighbouring cities are doing well partly because dire transport links make the likes of Manchester or Newcastle seem a world away from Wigan or Hartlepool. The transport infrastructure of the north has suffered from
decades of underinvestment. In 2018-19 government transport spending per person was £903 in London, against less than £500 in the north. In the past five years the government has spent more on transport infrastructure for 9m Londoners than England’s 15m northerners. The consequences are clear. In the south, Brighton has weathered the decline of its tourism industry by becoming an attractive place to live within easy reach of the capital. Blackpool, a once-lively seaside resort in the north-west, is a byword for decline. Although it is closer to Manchester than Brighton is to London, the trains take 20 minutes longer and are a quarter as frequent. Inter-city connections in the north are a mess. By train, it is quicker to travel 250 miles (400km) to Newcastle from London than it is to get to Newcastle from Liverpool, just 120 miles away. Buses are slow and pricey. And pity anyone without a ministerial helicopter if they need to get to Scotland. North of Newcastle, the A1 (a “strategic national road”, no less) in some places narrows to a
single carriageway that is often blocked by tractors. Rail is just the start. According to firms surveyed by EY, a consultancy, ropy infrastructure, including power, internet connectivity and transport, is the largest reason for not investing in English towns. Better vocational training would mean that once residents of Blackpool arrive in Manchester, they would have more chance of getting a job. A comprehensive deal with the EU would be better for the north than the skimpy effort that Mr Johnson seems intent on dashing off by the end of 2020. Giving more powers to English city mayors would help them draw up integrated regionaltransport plans. Although improving railways would be a long-term project, buses could rapidly be made better—perhaps in time for the election in 2024, when northerners will get to decide whether to cement their relationship with the Conservatives. The north does not need or want to rely on London to get back on track. If the government would only stump up the cash, the north will help itself.
ASTER, CHEAPER, better— technology is one field many people rely upon to offer a vision of a brighter future. But as the 2020s dawn, optimism is in short supply. The new technologies that dominated the past decade seem to be making things worse. Social media were supposed to bring people together. In the Arab spring of 2011 they were hailed as a liberating force. Today they are better known for invading privacy, spreading propaganda and undermining democracy. E-commerce, ride-hailing and the gig economy may be convenient, but they are charged with underpaying workers, exacerbating inequality and clogging the streets with vehicles. Parents worry that smartphones have turned their children into screenaddicted zombies. The technologies expected to
dominate the new decade also seem to cast a dark shadow. Artificial intelligence (AI) may well entrench bias and prejudice, threaten your job and shore up authoritarian rulers (see article). 5G is at the heart of the SinoAmerican trade war. Autonomous cars still do not work, but manage to kill people all the same. Polls show that internet firms are now less trusted than the banking industry. At the very moment banks are striving to rebrand themselves as tech firms, internet giants have become the new banks, morphing from talent magnets to pariahs. Even their employees are in revolt. The New York Times sums up the encroaching gloom. “A mood of pessimism”, it writes, has displaced “the idea of inevitable progress born in the scientific and industrial revolutions.” Except those words are from an article published in 1979. Back then the paper fretted that the anxiety was “fed by growing doubts about society’s ability to rein in the seemContinues on page 17
Monday 23 December 2019
BUSINESS DAY
17
In Association With
The sleuth of death row
Pessimism v progress
What does it take to become a death-row detective?
Continued from page 16
Richard Reyna, one of the last of his kind, has spent decades working the cases of those on America’s death row
I
N 1944 Raymond Chandler described the ideal character of a fictional private eye as a man comfortable on mean streets, but “who is not himself mean, who is neither tarnished nor afraid.” He is: …a relatively poor man, or he would not be a detective at all. He is a common man or he could not go among common people. He has a sense of character, or he would not know his job. He will take no man’s money dishonestly and no man’s insolence without a due and dispassionate revenge. He is a lonely man and his pride is that you will treat him as a proud man. To meet a real-life version of Chandler’s private eye, drive 40 miles (60km) north from Houston to Conroe, a fast-growing Texan city strung along either side of Interstate 45. Settle into a booth at Taqueria Jalisco, a Mexican breakfast joint in a low-slung strip-mall. It is summer, early morning, and already feels hot. A battered Nissan pulls up; a thickset man steps out. He wears black boots, pressed silver-grey trousers and a blue, short-sleeved shirt. A Rolex glints on one muscular arm. He carries himself with a slight swagger. Heads turn as he makes for his usual seat. Richard Reyna is handsome. He has an open, convivial face behind gold-rimmed glasses. He appears young for someone who just drove his grandson to college—and he wants to keep it that way. He neither smokes nor drinks. His hair has the slick, uniform blackness that comes only from a bottle. He doesn’t want his age published. Is he vain? He chuckles. Clients expect a youthful man in his line of work. Mr Reyna stands out among the 90,000 inhabitants of Conroe. He also stands out among America’s private eyes—who also happen to number about 90,000. Mr Reyna has a speciality. He is a death-row sleuth. He is hired, usually, as a late dice roll by the condemned, after their trial “went wrong” at state courts and as federal appeals and eventual lethal injection loom. His paymasters tend to be defence lawyers, the federal public defender, or European donors eager to expose America’s misuse of its death penalty. The Taqueria is his favourite spot in a city still divided by race. Not every place would be welcoming: “This is the middle of red-neck country. Lots of Klan, hell yeah.” He calls the café “my rat-hole”, pressing his fork into a grease-soaked omelette until a small oily puddle appears. “Usually I go home and think of getting my stomach pumped,” he says. But he spends several hours there, returning early the next day for more eggs and conversation. On first meeting the detective, some people ask if he is Native American, a question he finds
puzzling. He is Hispanic with roots in Mexico. He grew up in a government housing project in Houston’s Second Ward, where migrants flocked as whites fled for the suburbs. His father died “when I was a little bitty guy”; his mother single-handedly raised nine children in a tiny apartment, relying on handouts—rice, cheese, powdered milk—from a nearby hospital. For fun he and friends sniffed lighter fluid from handkerchiefs in back alleys or devised ways to steal from icecream vans. “Our idea of the Olympics was how fast we could strip a car,” he says. Fi f t y yea rs o n , l i tt l e ha s changed in the ward, where “macho men all beat their wives before the neighbours.” At reunions there, he finds that his siblings, and some of his old friends, “still don’t understand what I do.” They have preserved a way of walking, instilled in childhood, that he has mostly dropped. “People come in doing that duck walk, wearing pointed shoes, still blaming society for all their woes,” he says. Suddenly he bobs his head and rocks his shoulders in demonstration, a waddle from another time and place. He has seen tears, heard elaborate lies, and been asked by inmates about how to find peace He got hooked on crime as a child—in part by roaming the mean streets of the ward, but also by reading true-crime paperbacks. Their tales left him with an abiding urge to unpick a grisly story. “It bothers me that people aren’t interested in the truth.” When his mother called his books “disgusting”, he retorted he was “learning how stupid people are”. He still relishes real-life examples of “dumb” or venal criminals, such as a case he worked on in which a man convicted of rape and double murder was arrested only after turning in his own accomplices in an attempt to scoop a $5,000 reward. Mr Reyna’s reading habits have not changed. In his office at home a whole wall is hidden by shelves, four rows high, stacked with true-crime books. The rest of the office is crammed with files, souvenirs, newspaper clippings and photos of him with big-hatted Texan Republicans. As he serves eclairs and pours tea into fine china cups, he is
clearly pleased to be settled in a neat bungalow with a white fence and a large garden, shared with his wife Peggy, two cats and a dog. However, he still keeps in touch with his past. The witnesses he deals with are mostly poor. They are more at ease when they see his 1990 Nissan Stanza with 280,000 miles on the clock and observe his shadow of a duck walk. How did he escape? “ You have to want to get out. To realise there’s some more to life.” He enlisted, got posted to West Germany as others fought in Vietnam, and then became an army photographer. Discharged, he met a Hispanic sheriff at a Houston barbecue who needed help identifying corpses. That meant long hours in a morgue, often at night, taking fingerprints and photographs. He has hated photography since. In the sher iff ’s office he picked up skills, such as when he attended an advanced FBI course in how to manage and photograph a crime scene. A few years later he transferred to Conroe. However, like Chandler’s lonely, proud figure, he says he bridled against authority. “Conroe has a barrage of crimes. They chase some small stuff. But the real shit is white-collar corruption.” He talks of politicians and officials who illegally cut themselves profitable property deals, and speaks repeatedly of how the powerful get away with awful deeds. In a late-afternoon drive around Conroe, he points out housing blocks in Little Mexico, a poor Hispanic area, where he and other officers broke up a child-abuse ring. He tells of unearthing a labour camp where illegal migrants made creosote in dire conditions. The owner, “a real prick”, he says, had been untouchable because of big donations to politicians. In the early 1980s he got what seemed to be his big break. Fired from the sheriff ’s office for supposedly leaking stories to a newspaper, he was hired in 1984 by a private eye to look into a notorious capital case in Louisiana. Jimmy Wingo, a jail escapee, had been convicted of murdering a couple in their home on Christmas Eve. Wingo’s brief trial rested on a witness who later recanted. Mr Reyna dug up ample proof, he says,
of a crooked cop and flawed prosecution. Nonetheless, after three years Wingo was killed in the electric chair. “It was awful, I cried. I knew he was innocent, it got to me,” says Mr Reyna. “Why do everything the right way if it’s going to end like this? I had the evidence. It should have worked. It proved Wingo had no shit to do with this.” Afterwards he spoke several times to Wingo’s mother. “I didn’t want to carry on.” After the disappointment of that case started to become less acute, he realised that he had found meaningful work; indeed, that he had a calling. Now it is “what I’ll do until I drop dead.” By his reckoning, in 33 years he has helped win outright freedom for seven death-row prisoners and assisted many more in commuting death sentences. He has spent decades visiting death row, largely in Texas, mostly in the squat grey buildings in Livingston, a short drive from Conroe. He speaks to inmates as they wait for death, often up to the night before they are killed, though if they ask him to be there when they are killed he declines. He has seen tears, heard elaborate lies, and been asked by inmates about how to find peace. He has also seen how individuals respond when hope expires. Some refuse to leave their cells and must be dragged away to die. At the same time as Mr Reyna was working on the case that nearly broke him, he also took on the one that he considers his biggest success. Clarence Brandley was a black janitor wrongly convicted of raping and strangling a white teenager in a Conroe school. His case was prejudiced from the start : through false testimony from racist witnesses, destruction of exculpatory evidence by police and collaboration between prosecutors and judges. In 1981 an all-white jury sentenced him to death. Mr Reyna, recruited by the defence team in 1985, eventually found two white janitors who had been present when the murder happened. Neither of the white janitors was prosecuted, but by speaking to them separately, Mr Reyna got each to accuse the other one. He cajoled each to offer up intimate details of the crime. One of the men had admitted to the killing to his girl-friend, after coming home with blood on his shoes, though he later retracted his confession. Both witnesses, on video, said Brandley was not involved. He had come within just days of two scheduled execution dates, in 1985 and 1987. It took until December 1989 for the Texas Court of Criminal Appeals to overturn the conviction. On Mr Reyna’s office wall is a framed front page of the Houston Chronicle from 1990. It bears a large photo of Brandley and the detective marching together from prison. The publicity led to plenty of work.
ingly runaway forces of technology”. Today’s gloomy mood is centred on smartphones and social media, which took off a decade ago. Yet concerns that humanity has taken a technological wrong turn, or that particular technologies might be doing more harm than good, have arisen before. In the 1970s the despondency was prompted by concerns about overpopulation, environmental damage and the prospect of nuclear immolation. The 1920s witnessed a backlash against cars, which had earlier been seen as a miraculous answer to the affliction of horse-drawn vehicles—which filled the streets with noise and dung, and caused congestion and accidents. And the blight of industrialisation was decried in the 19th century by Luddites, Romantics and socialists, who worried (with good reason) about the displacement of skilled artisans, the despoiling of the countryside and the suffering of factory hands toiling in smokebelching mills. Stand back, and in each of these historical cases disappointment arose from a mix of unrealised hopes and unforeseen consequences. Technology unleashes the forces of creative destruction, so it is only natural that it leads to anxiety; for any given technology its drawbacks sometimes seem to outweigh its benefits. When this happens with several technologies at once, as today, the result is a wider sense of techno-pessimism. However, that pessimism can be overdone. Too often people focus on the drawbacks of a new technology while taking its benefits for granted. Worries about screen time should be weighed against the much more substantial benefits of ubiquitous communication and the instant access to information and entertainment that smartphones make possible. A further danger is that Luddite efforts to avoid the short-term costs associated with a new technology will end up denying access to its long-term benefits—something Carl Benedikt Frey, an Oxford academic, calls a “technology trap”. Fears that robots will steal people’s jobs may prompt politicians to tax them, for example, to discourage their use. Yet in the long run countries that wish to maintain their standard of living as their workforce ages and shrinks will need more robots, not fewer.
18
Monday 23 December 2019
BUSINESS DAY
In Association With
Africa’s affection economy
In much of Africa the family is bank, business and welfare state Sharing is central to economic life
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GAGGLE OF children play outside Dorothy Nabitaka’s front door on the outskirts of Kampala, the Ugandan capital. She shares her home with 17 people: her mother, child, sisters, nephews, nieces, cousins, and several children she has taken in simply because they had nowhere else to stay. She helps others pay school fees with the money she earns selling animal feed. In all she gives away around four-fifths of her income, she reckons, though she is not really counting. “I don’t like seeing people suffering,” she explains. Sharing within social networks is central to economic life in much of Africa. Although kinship systems vary, obligations typically extend beyond the nuclear family to include the children of siblings as well as cousins, or sometimes larger units such as clans. People turn to friends and relations for help with school fees, hospital bills, or for a place to stay. Where formal institutions are weak, the family is bank, business partner and welfare state. At times the pressure to share can be stifling. “People make
you feel guilty when they see you with a house, car or even a good dress,” says one Ugandan journalist. Black South Africans talk about paying a “black tax” to support a web of dependents. In Ethiopia, Pentecostal Christianity has taken off, in part because it offers an escape from traditional kinship obligations. One way to keep hold of your money is to hide it. Zainab Lamin, a housekeeper in Sierra Leone, tells her sisters she is unemployed. “If they know I have a job,” she says, “they will be sending their children to me—to pay for school fees” In
experiments, recipients of a cash windfall, such as a raffle prize, will often take less to keep their winnings under wraps. In Cameroon people take out loans they do not need so that relatives think they are hard-up. Kinship networks can grease the wheels of commerce with loans or by creating trust when contracts are hard to enforce. But they also come with an “extra bill” that can “slow down the growth of a business”, says Ronald Mukasa, who trains Ugandan entrepreneurs. Cash flows are diverted into weddings and funerals. Managers hire relatives,
who are not always up to the job. Yet family life is far more than an accounting exercise. In South Africa under apartheid, racist residence restrictions forced black workers to leave children in the care of others while they migrated to towns for work. Habits of sharing are now a bulwark against inequality. The term “black tax” is a misnomer, says Niq Mhlongo, the editor of a new book on the subject. He grew up in Soweto, a township, sharing a room with seven others. After the death of his father, his brother’s salary put him through school. As an adult, it was his turn to pay university fees for the same brother’s son. “It means that I had to postpone marriage,” he says, just as his brother had once done for him. “But is that a tax? No, it’s a family responsibility.” Mutual help acts as insurance against sudden shocks, such as illness or the loss of a job. One study in Kenya found that contributions from friends and family made up a quarter of income for poor rural households, mitigating swings in other earnings. Kinship cannot replace the welfare state. Sharing breaks down in the face of big shocks,
such as drought, which hit everybody at once. And the neediest people often have the weakest networks. But informal groups, such as savings circles, can connect to larger institutions. As horizons expand, social networks do too. Nigerians encourage their relatives to go abroad to support the family, says Olayinka Akanle of the University of Ibadan. Emigrants sometimes invest in schools or businesses back home, and ask kin to oversee them in their absence. Remittances to Nigeria now exceed oil revenues: last year they brought in about $24bn, 11 times more than all foreign direct investment. Urbanisation, consumerism and rising inequality may strain kinship ties, but they have not yet broken them. In a trendy café in Kampala, two sisters discuss the middle-class dilemma. “How do you save up when your salary doesn’t just look after you?” asks one. She cannot afford to go travelling as much as she would like. Yet sharing is her culture, and she would have it no other way. “Your savings are in people,” her sister elaborates. “So when I have a bad day I cannot starve.”
Adventurous spirit
Elephant dung is fuelling South Africa’s gin boom Sales have jumped by 54% in a year Even as posh new craft gins generate a buzz, most South Africans stick to the cheaper stuff. Gins that cost more than 225 rand a bottle account for just 6% of sales. But for those who can afford to splash out, the delights of elephant dung and tonic await.
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OU MIGHT think that elephant dung is best kept far away from gin, which most people find tasty enough served with tonic water and a slice of lime. Not so, say Paula and Les Ansley, South African distillers who infuse theirs with pachyderm poo to capture “the textures and flavours of the African bush” and sell it for 659 rand ($46) a bottle. Indlovu gin may be aimed primarily at those with an “adventurous spirit”, but it is only the latest splash of ethanol on a market that has caught fire. In 2018 South Africans sipped 54% more gin than the year before, reckons IWSR, a research firm. Meeting this demand are dozens of new firms. At the inaugural SA Craft Gin Awards in August there were 110 entries. “For decades we have been drinking many imported British gins,” says Jean Buckham, who runs The Gin Box, a subscription service that deals exclusively in South African craft gin. “Until recently, we had never really South Africanised it.” In 2015 there were fewer than a dozen gin distilleries. Now there are 50, of which 30 are in the
Western Cape. Part of the region’s attraction is its wealth of “botanicals”, or natural flavourings, which make each gin taste different. Inverroche, one of the pioneers of South Africa’s craft industry, uses fragrant fynbos shrubs. It makes 18,000 bottles a month and exports to 17 countries. Three factors explain South Africa’s boom. The first is that gin is becoming more popular every-
where. Consumption increased by 8% around the world and 52% in Britain in 2018. Another was a liberalisation of licensing laws after the end of apartheid in 1994 that made it easier to start a distillery and for non-whites to consume the same types of alcohol as whites. (Under the racist regime it was hard for black South Africans to go to liquor shops to buy “white” booze; instead they went to infor-
mal boozers called shebeens.) The last is that producers of South Africa’s more famous drink, wine, are struggling. A gin distillery can be set up in a warehouse; a vineyard needs sun, water and land. Across the Western Cape vintners are wrestling with recent droughts, contested land claims and weak prices. BDO, a consulting firm, reckons that only half of vineyards are making money.
Monday 23 December 2019
BUSINESS DAY
COMPANIES & MARKETS
19
COMPANY NEWS ANALYSIS INSIGHT
Consumer Goods
Border closure lifts 2020 outlook for FMN SEGUN ADAMS
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ith Nigeria’s land borders shut, the shift from the country’s favourite staple food to a substitute means pasta makers would gain. Flour Mill of Nigeria (FMN) is one of such producers to bet on. Nigerian consumers are already adapting to the closure of land borders in August by switching to local rice and pasta. For FMN, “Shifting demand to pasta suggests stronger earnings in 2020,” say analysts at Lagos-based Chapel Hill Denham. According to the analysts, the renewed demand for pasta to boost food turnover in 2020, as the recent border closure has impacted rice importation, inducing a shift in demand to Pasta (Spaghetti, Macaroni etc). Chapel Hill Denham’s market price survey indicates that FMN’s Golden Penny Spaghet-
ti retail price has increased to an average of N235/500grams stock keeping unit (from an average of N200), while the price of Power Pasta Spaghetti (produced by Dufil) has in-
creased to N200/500grams SKU (from N180). This is expected to lead to a higher sales volume in the consumer good firm’s food segment which in the first half
of next year. Chapel Hill Denham’s projection, however, shows a 0.4 percent growth in FMN revenue and a decline in the company’s top-line in the period.
However, they expect profit to grow 16.4 percent to N5.9bn in the first six months of next year. The analysts also expect the Sugar and Agro-Allied segments to maintain current growth trajectories (grew by 15.1 percent year-on-year and 5.1 percent year-on-year respectively to N44.94bn and N49.40bn in H1-20) pushing 2020 turnover to N548.32bn, up 4.0 percent year-on-year from N527.41bn in 2019. The pressure on gross profit will arise from cost pressures which would remain high next year. Sources of the pressure would be the cost of barging, demurrage and port related costs. However, weaker wheat and CPO input prices are likely to marginally support gross margin to 11.8 percent in 2020 from 11.7 percent in the first half of next year and 10.1 percent in 2019 as revenue rises by 4.0 percent year-on-year Given the lower interest rate environment, FMN is
expected to tap into the debt market for more refinancing. The company has raised about N22.72bn in Commercial Papers in the 2019/2020 year. “We believe the company’s current N3.00bn CP in the market (closes 19 December 2019) is a strategic move to take advantage of the current low-interest-rate environment, as we expect more issues before the end of the financial year,” Chapel Hill Denham. The analysts also expect Lower Capex to support Free Cash Flow to Equity next year given the completion of its business expansion and restructuring (merger of Golden Sugar and Sunti Golden Sugar Estates). Chapel Hill Denham retains a buying rating on the stock and raised its target price to N25.58 from N17.99. The new TP represents a potential total return of 38.7 percent (capital gain of 32.5 percent and a dividend yield of 10.3 percent).
MARKETS
SBM says it got 60% of its 2019 predictions right. Here’s its 2020 outlook SEGUN ADAMS
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n intelligence platform which got 60 percent of its 2019 predictions correctly and was partially correct on 14 percent gives its outlook for next year Among other things, Lagos-based SBMorgen correctly predicted average oil price, the impact of regulation on Fintechs, fiscal problems of the FGalthough it was wrong on its prediction that Nigeria would see another recession in 2019. Here we draw some of the most important forecastS made that can help guide your investment decisions next year (BusinessDay is not recommending any investment action). Nigeria’s 2020 growth to beat World Bank forecast: SBM says Nigeria will grow better than the World Bank expects to around 2.4 percent next year on the back of improved oil revenues. It however says Nigeria would still be trapped in a low-growth cycle for the next few years unless there is a reform. To achieve faster growth,
SBM recommends attracting targeted investments at sectors like oil and gas, agriculture, manufacturing and telecom, which are all growth-driving sectors. It is however not likely any of these would happen, SBM says. Global economy will slightly improve next year but will be dependent on the outcome of the USChina trade move for a truce and Brexit. Inflation will continue to rise in 2020: Food inflation will keep stoking price level next year, says SMB, which expects an average inflation rate of 13 percent in 2020. The intelligence platform says that despite talks by the CBN that the impact of its FX supply restrictions on some food items and the closure of the border would wane in three to four months, the VAT increase, a possible electricity tariff hike and increase in retail price of petrol next year would push inflation higher. Unstable oil price next year: OPEC will struggle to control production next year and has forecast that oil process price may come under selling pressure due
to the US-China trade war negotiations, say SBM. OPEC will count on Saudi Arabia to keep a lid on its production so oil can be around $65/barrel but US Shale producers will only be encouraged by the price to produce more and cause a glut. SBM says oil can dip to $40 per barrel by 2020end given that US has become a net exporter of the commodity for the first time in decades and US and China could cause a global slowdown. More Oil majors will sell off their assets in Nigeria: SMB says there will be more exits in Nigeria’s oil industry. This, we believe, calls for policymakers to adjust frameworks in other to encourage capital to stay. Fixed income yields to trail inflation: SMB believes that the once high-yielding risk free zone would underperform inflation next year. Already yields on treasury bills are lower than inflation meaning investments have negative real returns. Devaluation of the Naira in H1: The OMO bubble is ex-
pected to burst and foreign portfolio investors withdrawal their dollars from the economy. SBM says government purse is in bad shape and with the minimum wage not yet being paid, the CBN cannot defend the Naira at current levels. FDIs will keep away given the lack of positive macro conditions while FPIs will take short term positions and the net FX inflows will oscillate. The CBN which has spent no less than $3.3bn in the second half of the year to support the naira
has outlined the conditions for devaluation: reserve at $25bn-$30bn and oil price at $50-$45. The Intelligence platform expects government to take the hard choice of devaluing the Naira on or before June 2020. (Reserve was at $39bn and oil price was at $66.37 as of Friday: BD data). Equity prices should improve: SBM says it expects some funds to rotate to the equity market in Q1 2020 following the restriction of OMO window to non-bank local
investors. Dividend-yields of blue chips will be the pull factor but there would be no rally like was seen in previous years, SBM says. Price subsidy will be adjusted or removed: The days of cheap fuel may soon be over or at least Nigerians would likely pay more next year, SBM says. The subsidy is a drag on revenue and Buhari would surprise many with a partial or full subsidy removal although it remains to see if there would be a full deregulation of the oil sector.
L-R: Babajide Arowosafe, executive director, technical NIRSAL; Bolaji Akinboro, co-CEO, Cellulant; Ademola Adebise, managing director, Wema Bank, and Ken Njoroge, co-CEO, Cellulant, during the signing of a N2Billion loan facility to Nigerian farmers at the Inaugural Partner Summit organised by Cellulant Nigeria in Lagos.
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Monday 23 December 2019
BUSINESS DAY
COMPANIES&MARKETS LOGISTICS
Zippy logistics partners Providus Bank, ShopRite to deepen retail value-chain
Business Event
…Launches ‘#IspotZippy’ national campaign
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ippy Logistics, a end-to-end logistics company has par tnered Providus Bank and ShopRite to deepen consumers’experience by deepening the retail value-chain across Nigeria through its logistics offerings with financial support from Providus Bank. Similarly, the logistics firm launched a national consumer campaign aimed at rewarding consumers tagged, #IspotZippy; a consumer campaign expected to bring shoppers to all ShopRite stores nationwide between December 20 and 30. Aimed at promoting tourism within Africa, five (5) lucky winners in the #IspotZippy campaign will get an all expense trip to five luxury destinations. The destinations are Seychelles, Zanzibar, Kigali, Cape Verde and Mauritius.
“It is our way of giving back to those who have indirectly supported our business. However, it is a part of a larger strategy which we are launching early next year,” said Kabir Shagaya, the managing director of Zippy Logistics, stating that, “This year’s campaign differs from its maiden edition in that, participants will be required to; spot “Zippy Santa” in participating ShopRite locations.” According to Shagaya, logistics and finance are two modern trade challenges for retailers. “Seeing as we have a solution that already addresses the logistics problem effectively, we alongside our partners at Providus bank have designed a product to allow supermarket vendors receive payment at point of delivery and not have to wait for their agreed payment terms with the supermar-
kets”. Shagaya disclosed that winners will be announced every two days on Zippy Logistics social media pages. According to him, since inception Zippy Logistics has remained a premier provider of logistics and supply chain solutions across Nigeria and is well equipped to offer services in the areas of procurement, inventory management, warehousing, e-commerce services and last mile deliveries amongst other tailored services. To participate in the campaign, consumers will have to take a picture with or of the Zippy Santa with their ShopRite purchase receipt, and then post across their social media platform with the tag #IspotZippy. Consumers are also expected to follow Zippy Logistics, Providus Bank, ShopRite on all social media.
DEALS
Rensource energy raises largest ever fund in Nigeria’s renewable sector DIPO OLADEHINDE
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n Tuesday, Nigeria’s renewable startup Rensource Energy has raised a $20 million Series A round co-led by CRE Venture Capital and the Omidyar network, – the largest ever for a Nigerian renewable energy start-up. Nigeria’s economy needs quick and stable growth over a few decades if it is to create jobs for its 21 million unemployed citizens and lift 87 million people out of extreme poverty. To achieve this growth, Nigeria will require a lot of energy, regardless of what sector gives us that growth. With the $20 million round Rensource is launching its Spaces Offline to Online platform for supplychain services, including business-analytics and working capital options. “We’ve pivoted away from a residential focus… and we’re building much larger systems to become essentially the utility for these large urban markets we have a lot of in Nigeria,” Rensource co-founder Ademola Adesina said in a statement.
The Series round was co-led by existing investors CRE Venture Capital and the Omidyar Network, with participation from Inspired Evolution, Proparco, EDPR, and other investors. “This round will see the company expand their offering beyond energy, with the launch of a new B2B platform, “Spaces O2O”, a project created to address the holes in the country’s fragmented supply chain. This will ultimately help SMEs and microSMEs, working in the regions they have a presence, access services that accelerate their productivity growth,” Adesina said. Each day, Nigeria generates under 4,000 Megawatts (MW) of electricity, insufficient to cater to the essential lighting, cooling, and charging needs of an expanding population. Citizens have been conditioned to expect blackouts due to unstable power supply, which justifies seeking alternative power sources—burning biomass, generators, solar home These alternatives compensate for the unreli-
ability of the grid and the shortfall from inadequate power generation. Rensources is also following a trend by some Nigeria based startups, such as trucking-logistics company Kobo360 and motorcycle ride-hail company Gokada, to shape a suite of additional services around the needs of core clients. The company has a partnership with German manufacturer BOS AG, with whom its designs specialized panels for its use case. Rensource also has developer teams in Nigeria and Europe for its software related programs. Other companies have implemented similar schemes, usually providing solar home systems comprising of solar panels, an inverter and batteries for energy storage. Their pitch has also been multidimensional: offering households clean and reliable electricity to boost productivity. The solar gospel is being spread further by NGO’s like Rees Africa and Solar Sisters, both of which focus on rural and less-developed parts of the country.
L-R: Adesola Olusade, permanent secretary, Federal Ministry of Youths and Sports Development; Wale Olaoye, GMD, Halogen Group; Odunayo Adekuoroye, Commonwealth senior category gold medalist and female Olympic wrestling gold medal hopeful; Sunday Dare, minister of youths and sports development, and Wale Adeagbo, chief operating officer, Academy Halogen, after Halogen Group management adopted the Nigerian freestyle female wrestling Champion, Odunayo at the launch of federal government’s “Adopt an Athlete Initiative” ahead of 2020 Tokyo Olympic Games in Lagos.
L-R: Chairman of the Lagos State Chapter, Nigerian Institute of Public Relations, Mr. Olusegun McMedal; President and Chairman of the Council, Nigerian Institute of Public Relations Mallam Mukhtar Sirajo; Award Winner, Managing Director/CEO, MediaCraft, Mr.John Ehiguese ; and wife, Mrs. Susan Ehiguese, receiving PR Practitioner of the year award at the Lagos PR Industry Gala and Awards Night, held in Lagos… yesterday Pic by Pius Okeosisi
L-R: Francis Wasa, deputy director, payment system management, CBN; Obiora Atuokwu, director of marketing, Global Accelerex; Liman V. Liman, DG, Nigerian Office for Trade Negotiations/acting chief trade negotiator; Kayode Ariyo, ED, Business Development & Operations, Global Accelerex; Ibrahim Musa, chairman, NEPC, and Olatunde Ogungbade, MD, Global Accelerex, at the PoS Innovation Summit organised by Global Accelerex recently at Eko Hotel, Lagos.
L-R: Sharon Ikeazor, minister of state for Environment; Mohammed Mahmood Abubakar, minister of Environment; Ibukun Odusote, permanent secretary Ministry of Environment, and Sola Adepoju, chairman of the committee, at the inauguration of the Inter-Ministerial Committee on Implementation of the President’s pledge at the 74th UNGA of planting 25 million Trees in Abuja. Pic by Tunde Adeniyi
Monday 23 December 2019
BUSINESS DAY
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Monday 23 December 2019
BUSINESS DAY
COMPANIES&MARKETS TECHNOLOGY
Bizshield Mobile prelaunches website, app in Lagos for businesses JOSEPHINE OKOJIE
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izshield Mobile, a website and an app has prelaunched into the Nigerian market to seamlessly connect users to online businesses across Africa. The mobile app is a combination of social media platforms and a global ecommerce site that is better and easier to operate for all business activities. Bizshield is a website that comes with an app and other benefits. It can accommodate 100 million subscribers and 50 million users simultaneously. “ The app is specifically designed for the day to day online running of businesses in Africa with the understanding of the business terrains and accommodation of the related problems,” Temitope Tolani Akintunde, founder and CEO of Bizshield said at the prelaunch. “We are focused on solv-
ing business issues for all classes in Africa, thus all businesses operating in Africa can use our platform and this is the same for consumers, as they are guaranteed a trustworthy transaction anytime they buy from our app,” she said. Akintunde said that the app was borne out of the need to address a personal challenge and prevent scammers from defrauding people of their hard-earned money. She further said that the app is expected to boost businesses registered on the platform by 45percent within seven weeks of its launch. “With our innovative 4 in 1 app, Bizshield Africa will help lots of businesses in Africa especially in Nigeria to flourish and thrive more online,” she further said. “The platform provides subscribers with a platform that delivers at ease the services of a website, social media, and user-friendly
interface designed to allow users have a wonderful experience while surfing through pages of subscribers and more,” she explains. She added that the app is designed to grant users all features of social media platforms such as following, likes, comment, save, tag and search among others. Similarly, it is designed as a standard website where details, colours, pricing, rating, buy now, add to cart, make payment and waybill tracking among others can be done by the sellers and buyers, she said. She called on business owners in Africa to come on board at a discount on the prelaunch subscription fee. “Subs cr iption fee of N40,000 would be charged for subscription upon launch of the app come March 2020 but a prelaunch subscription fee of N14,440 is currently available for early subscribers who would like to register now,” the chief executive said.
She noted that a mechanism has been incorporated for verification tags for subscribers. “A business subscriber’s account only gets verified as a trusted and authentic African seller after providing certain documents to us.” She stated that businesses
just need to subscriber and create their accounts on the app as well as upload their goods and services with details on the platform with customers having access to their existing website and social media accounts. On the security of the app, she says that the ser-
vice cannot malfunction or be down as it is being developed programmed in the UK as well as hosted and managed by experts who have been engaged to allow a free flow of transactions. The app can be downloaded on google play store.
L-R:Ahmad Rabiu, board member, Financial Reporting Council (FRC);Daniel Asapokhai, executive secretary/CEO, FRC, and Muhammad Musa Bello, minister of the Federal Capital Territory (FCT), at the presentation of copies of the International Financial Reporting Standards to the minister, during a courtesy visit to the minister in Abuja.
Monday 23 December 2019
BUSINESS DAY
23
MARKETS INTELLIGENCE Supported by Asset Management Corporation of Nigeria (AMCON)
Stocks
Currencies
Commodities
Rates + Bonds
Economics
Funds
Week Ahead
Watchlist
When compared to peers, Nigerian banks are not lending BALA AUGIE
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ecently, the Central Bank of Nigeria (CBN) has introduced guidelines aimed at forcing banks to revert to their traditional role of lending. The lender of last resort had issued guidelines that mandated banks to maintain a minimum Loans to Deposit Ratio (LDR) of 65 percent by December 31 2019 and 150n percent weighting to be applied to loans to SME, retail, consumer and mortgage sectors for the purpose of LDR computation. Interestingly, Nigerian banks have the lowest LDR when compared to their peers in Africa, Emerging and Frontier Market countries. For instance, Guaranty Trust Bank (GTBank) Plc, Zenith Bank, Access Bank, FirstBank Holdings, and United Bank for Africa (UBA) have LDR of 54 percent, 55.80 percent, 67.40 percent, 54.20 percent, and 62.10 percent as at September 2019. That compares with the LDR of absa Bank of South Africa, (103.80 percent); Sber Bank of Russia, (92.40 percent); CIM Bank of Malaysia (87.10
percent); Gulf Bank of Kuwait, (82.50 percent); Affin Bank of Brazil 77.60 percent); State of India of India (75.90 percent); Scamcon Bank of Vietnam, (74.70 percent); Bank Aljazera of Saudi Arabia, (71.90 percent), and ICB of (China 66.40 percent). Analysts are of the view that Nigerian lenders are cautious of extending credit from to high risk sectors as they are recovering from the shock of the precipitous drop in crude oil price that resulted in huge write-offs. Wale Okunrinboye, Investment Analyst at Sigma Pensions Limited said these countries did not go
through the oil predicament that stoked the Non Performing Loans (NPLs) of oil producing Nations and that LDR for Nigerian banks were high in pre crises period (2014). “A lot of issues came up in 2018. For instance the introduction of the International Reporting Standard (IFRS) 9 changed the computation o fundamental ratios,” said we are just coming out of a cycle” The Central Bank of Nigeria (CBN) had issued guidelines that mandated banks to maintain a minimum LDR of 65 percent by December 31 2019 and 150n percent weighting to be applied to loans to SME, retail, consumer and mortgage sectors for the purpose of LDR computation. Measures to bolster credit are part of President Muhammadu Buhari’s plans to revive an economy that is growing sluggishly. Cordros Capital Limited estimated that banks would need to create an aggregate of N2.11 trillion to meet the new floor, as they expect more penalties from regulators. Nigerian banks had lost some of their appetite to extend credit after the sudden crash the crude oil price of mid 2014 resulted huge bad loans and deteriorating asset quality, but they are now tapping into retail and consumer space of the market amid
stringent regulations. Additionally, firms had been packing their money in short term government securities when yields were high, while they continue to deliver a higher return for shareholders in form of bumper dividend payment. “We see this as headroom for increased extension of credit in Nigeria on stronger macro improvement,” said analysts at Chapel Hill Denham Limited. “In line with our macro outlook, we believe fiscal and structural reforms will be likely to foster economic expansion,” said analysts at Chapel Hill Denham. Analysts say the short notice given to banks to comply with rule, as well as desperations to avert sanctions, probably lead some of them to trim the interest rate they charge on loans. Over the last few days, companies have continued to lower their lending and deposit rates as they struggle to meet the deadline, as the regulator had in a recent circular banned individuals and local firms from investing in both its primary and secondary Open Market Operations (OMO) auctions. The average monthly deposit rates for banks which were about 4 percent last week Monday has been further reviewed by banks to about 3 percent as at Friday. Analysts say CBN’s minimum LDR policy also means that banks are not enthusiastic about sourcing deposits, resulting in a significant decline in deposit rates. Analysts at Chapel Hill Denham Limited said some lenders were banks are accepting deposits at about 2 percent compared to c.10 percent previously They added that the new rules restricting individuals, Pension Fund Administrators PFAs and corporates to Nigerian Treasury Bills (NTbills), fixed deposits and FGN bonds have resulted in increased demand for NTbills, forcing down rates.
Why investors should buy Dangote Cement, Zenith Bank, and GTBank’s stocks BALA AUGIE
I
nvestors should add Dangote Cement Nigeria Plc, Zenith Bank Nigeria Plc,and Guaranty Trust (GTBank) Bank Plc to their portfolio. These three firms are value stocks because they have a very low price to earnings (P/E ratio),
low price to book (P/B) ratio, and high dividend yield, and there upside potentials in the industry they operate. They also have the potentials to outperform growth, as investors have dumped shares due to a myriad of challenges across sectors and lack of policy direction on the part of President Muhammadu Buhar. Dangote Cement, the largest producer of the building material
in Africa’s largest econoy and the most capitalized firm, has a price to earnings (P/E) ratio of 2.81 times, which is lower than earnings per share (EPS) of N22.67. The proposed capital expenditure spending by Federal Government and the need to bridge an infrastructure deficit are expected to give a fillip to cement volumes, adding impetus to the future earnings of the cement maker.
Dangote has a dividend yield of 11.44 percent, and it paid an N272.91 billion from distributable profit to shareholders. It had agreed share buyback and reverse split. Stock buybacks refer to the repurchasing of shares of stock by the company that issued them. Zenith Bank’s shares are trading at 2.89 times earnings, while Continues on Page
P.E
SHORT TAKES 3-yr The value of Nigeria’s total trade jumped 6.77 percent to N9.18 trillion in the third quarter, up from N8.60 trillion recorded in the previous quarter second quarter. The value of the export component increased by 15.02 percent to N5.28trillion when compared to second quarter and 8.97percent when compared with the corresponding quarter in 2018, this is the highest in three years. The import component however, stood at N3.89 trillion a 2.70 percent drop when compared to performance in the second quarter and 7.47 percent when compared to the third quarter in 2018.This means the Nigeria’s trade balance increased a high N1.38 trillion. By implication, this means the country’s trade balance, which is the difference between the value of export and import, increased N582.3 billion on the back of a fall in imports.
$65 Oil rose above $65 a barrel for the first time in almost three months after the U.S. and China agreed on the text of a partial trade deal, giving a boost to the fragile outlook for global oil demand. Futures climbed as much as 2.2% in New York, to the highest level since Sept. 17. Chinese officials said the countries agreed not to impose tariffs set to go into effect Dec. 15, and China will increase imports from the U.S. as part of the deal. Prices slipped briefly earlier after U.S. President Donald Trump in a tweet disputed a story that said tariffs would be rolled back.
-15.57% The stock market is down by almost 16 percent so far in the year, after trading closed 0.13 percent lower on Friday. The bourse trades around 7x PE compared to 11.8x of frontier market and 14.7x of emerging markets.
BusinessDay MARKETS INTELLIGENCE (Team lead: BALA AUGIE - Analyst: Dipo Oladehinde, ENDURANCE OKAFOR, BUNMI BAILEY Graphics: FIFEN FAMOUS)
BMI provides in-depth analysis and data on industries, companies, stocks, currencies, fixed income/credit, economics, regulation and factors that influence investor’s decision-making Continues on page 37 Email the BMI team patrick.atuanya@businessdayonline.com www.businessday.ng
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Monday 23 December 2019
BUSINESS DAY
MARKETS INTELLIGENCE
Dangote Sugar may see profit decline for second consecutive year IFEANYI JOHN
S
ince posting a record profit after tax of N39.7 billion in 2017, Dangote Sugar has struggled to replicate such strong performance amidst declining sugar prices, weakening consumer demand in Nigeria and rising expenditure. In 2018, Dangote Sugar reported net earnings of N21.9 billion and the company appears poised to generate net earnings around N19.5 billion this year based on annualized earnings after the company reported that it generated N14.7 billion in net earnings in the first 9 months of the year. The biggest challenge the company has faced in growing its profitability has been the declining demand for sugar which is negatively impacting its topline performance. In 2018, the com-
pany’s revenue dropped by around N54 billion or 26% in just one single year. However, revenue is forecasted to improve to N156.1 billion this year which is 4% higher than the N150.3 billion it achieved in 2018 but still far behind the N204.4 billion revenue generated in 2017.
Analysis of the Bloomberg sugar index which tracks the daily changes in prices of future sugar contracts shows that the price of sugar has declined by more than 50% in the last 3 years. Since peaking at $156 in July 2016, sugar price has fallen to about
Corporate year in review: deals, drama, spies and successes Chinese growth fell off and Germany felt gloomy but there were pockets of cheer and plenty of action Tom Braithwaite, FT
T
his time last year global stock markets had just endured a big sell-off. Macro worries included the USChina trade war and Brexit. Twelve months on, neither is resolved positively. Chinese economic growth has since fallen to its lowest level in 30 years. German business confidence has descended into deep gloom. But despite all of this there has been some cheer and plenty of action in the business world in 2019. Public display of affection? Public market investors have complained for years that stock markets are being hollowed out in a spate of mergers, take-privates and stubborn unicorns. Much of that trend continued in 2019. The UK, for example, saw a series of privatisations, of Legolandowner Merlin Entertainments, defence contractor Cobham and satellite company Inmarsat. But we did finally see some replenishment. Lyft and Uber floated, with the two ride-hailing companies vying for public
investors instead of passengers. It has not gone brilliantly, however: their stocks are both down by a third. Slack, the office messaging company, has fallen 45 per cent. It took months of delays for Saudi Aramco to list and achieve the $2tn valuation sought by Prince Mohammed bin Salman. But does it really count? The state-owned oil company had to give up on a foreign listing and stick to Riyadh, where it lent heavily on local investors. Many international institutions balked at a combination of valuation and governance concerns. Only a sliver of the company is freely traded. The kingdom suffered an indirect blow from another — far more spectacular — botched IPO this year. WeWork’s flotation was the biggest test yet for its main backer, the $100bn SoftBank Vision Fund, whose biggest investor is Saudi Arabia. A lot of people said WeWork was an overvalued property group, whose business model of taking long-term leases, sprucing them up and reletting them on a short-term basis was flawed. But not www.businessday.ng
many people predicted the IPO itself would fail. Investors had no interest in buying in at SoftBank’s $47bn valuation but nor did investment bankers elicit sufficient interest at $20bn or less. In the end, the IPO was not possible and founder Adam Neumann departed the company. SoftBank slashed the valuation to $5bn. SoftBank is persevering. It abandoned Wag, its dogwalking start-up, but increased its bet on Oyo, its Indian hotels business. Meanwhile, it is trying to raise money for a second big tech fund and hoping that chief executive Masayoshi Son can pick just one knockout winner — as he did so successfully with Alibaba — to redeem the grand project. As some of the unicorns struggled in the public glare, other old stagers of the tech sector shone. Apple added $400bn in market capitalisation despite an unremarkable year for hardware releases. Microsoft briefly became the world’s most valuable public company and now has almost $1.2tn in equity value, a remarkable feat 20 years after its previous era of dominance.
$70, representing a decline of around 55%. According to the International Sugar Organization (ISO), the cause of the drastic drop in sugar prices can be traced to the sugar glut currently in the global market. According to ISO, global sugar surplus is set to
hit 1.83 million tonnes in the 2018/19 season, up from a previous estimate of 641,000 tonnes. The excess production they said is coming largely from India and Thailand were sugar production has grown astronomically in recent times. Expected sugar consumption in 2018/19 was revised down to 176.91 million tonnes, from the previous forecast of 178.04 million tonnes according to ISO. The intergovernmental body is also forecasting a shift to a global deficit of about 3 million tonnes could occur next year but opine that it may not lead to any recovery in sugar prices. “It has to be stressed that any price recovery on the back of a statistical deficit of this magnitude might be muted by the huge stocks accumulated since the beginning of the surplus phase in 2017/18,” the ISO said ac-
cording a report by Reuters. “If sugar prices continue to dwindle the prospects for a significant growth in sugar prices may be very dim,” said Maju Eldad, a Nigerian economist. “I think Dangote Sugar will have to refocus its business to put more strategic intent towards cost cutting and improve cost efficiency if the business will hope to see profit growth in the near future. Operating expenses has remained flat in the last two years, as the company spent N7.4 billion in 2017 and grew OPEX to N7.7 billion in 2018 despite a decline in revenue in the business. Dangote Sugar closed the market on Friday lower, returning -9.97% to end the trading day at N14.90. The stock however is down significantly from a high of N22.50 it reached in early 2018 when the company last reported year on year growth in its net earnings.
Why investors should... Continued from Page its earnings per share are N6.89. It has a dividend yield of 15.22 percent. The lender is making an inroad into retail banking, a venture that is expected to
impact positively on future earnings. Guaranty Trust Bank (GTBank) has a price to earnings ratio of 4.47 times, which is higher than the earnings per share of N6.62. It has a dividend yield of
N9.29. The largest lender by market capitalization has a return on average equity of 32.58 percent as at September 2019, the highest in the industry, a manifestation of improved efficiency.
Aviation: Boeing parks its 737 aspirations Andrew Edgecliffe-Johnson, Peggy Hollinger and Kiran Stacey, FT
I
t has been getting harder for staff to find parking spaces at Boeing’s Renton plant outside Seattle. For much of this year, the world’s largest aircraft manufacturer has been using the employee car park to store planes which it cannot deliver.
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Renton is home to the 737 Max, the latest model of the best selling commercial jet in history. Since two fatal crashes prompted global regulators to ground the entire Max fleet in March, the plant’s 12,000 people have been confronted each day they arrive for work with hulking reminders of the biggest crisis in Boeing’s 103year history. The company has been producing 42 Max jets a month, even while it could @Businessdayng
not send them on to customers, leaving it with 400 “white tails” — finished planes awaiting airline liveries — in need of novel storage solutions. They will soon have more room, after Boeing announced this week that it is halting production at Renton for an indefinite period. Employees will be parking at other nearby Boeing facilities where the $188bn company has promised to find them work.
Monday 23 December 2019
BUSINESS DAY
This is MONEY
• Savings • Travel • Debt & Borrowing
A guide to your Personal Finance
25
• Utilities • Managing your Tax
How to protect wealth in unstable investment market The Solid Wealth Messenger
Grace Agada
T
here is only one way to increase existing wealth. This way is for a person to put existing capital in a money growth vehicle. The only money growth vehicle that exists is the investment vehicle. Investment vehicles are financial vehicles that have two separate capacities. First, there have the capacity to grow wealth and there also have the capacity to destroy wealth. What determines what there do to wealth is influenced by the stability of the investment market. Investment markets are unstable because there are controlled by forces out of our control. If an investment vehicle returns invested capital with interest from an unstable investment market, money increases and wealth is preserved. If wealth is lost, money decreases and wealth dissipates. The increase or decrease in wealth is dependent on three factors. The first is where the money is invested. That is the investment vehicle an investor chooses. The second is what guides investment decisions. That is what an investor is trying to achieve. And the third is the investment market. That is the level of stability of the market in which an investment operates. These three things are what determine the safety of wealth in an investment market. While investors can control their choice of investment vehicle and the reason for investing, they cannot control the market. The investment market will rise and fall regardless of what investors do. What determines whether wealth is preserved is the protection investors put in place now. To protect oneself, investors need to take organized actions that are congruent with wealth preservation goals. The worst thing investors can do is to make random and erratic decisions in an unstable market. It is like acting out of control on a risky and unsafe road. When you find yourself on a risky road you need coordination, concentration, and the right knowl-
edge to survive. If you are disorganized and spontaneous in your actions chances are high you will get hurt. Achieving safety in an unsafe environment is therefore not about the risk in the environment. But your ability to remain grounded, maintain coordination and be prepared. As long as you conduct yourself in ways that are in agreement with safety, you will be safe. The unstable investment environment operates the exact same way. The market is risky and will be risky no matter what you do. It is your ability to get the right knowledge and take the right actions that will guarantee your safety. Trying to beat or outsmart the market is a fool’s game. Investor’s focus should be on developing the right attitudes for safety in an unsafe investment market. To protect shelter and grow wealth in a wildly random investment market Investors need to do three things. First, they need to set clear goals. Second, they need to invest based on their goals. Third, they need to align their actions and decisions with their desired goals. These are the three things investors must do to ensure the long-term stability of wealth in an unstable investment market. Below are more details about these three things. First, Investors must set clear goals. Investing without a clear goal is like going into the investment world blindfolded with large amounts of cash. Money is lost and wealth is dissipated. It is simply committing financial suicide. Goals are like a compass that guides investors in their investment decisions and is critical for investing success. While many investors have an idea of their goals, it is not hard to see that most goals are not in agreement with an investor’s purpose and objectives. Setting clear goals means understanding the purpose of investing and the most appropriate investment vehicle to use. Setting clear goals also means understanding what investing success means to you. Although tradition measurement ties investing success to financial returns, this is not entirely accurate. Financial returns can rise and fall depending on market conditions. Tying investing success to financial returns makes investor’s wealth unstable, fragile and unpredictable. True investing success is measured by achieving high financial stability through the fulfillment of important goals. That is the ability of investors to remain resilient in the face of dwindling market conditions. To maintain financial stability, investors must fo-
Objectives • Solid Wealth Creation • Solid Wealth Preservation www.businessday.ng
cus on three goals. The first goal is personal protection goals. The second goals are growth goals and the third goal are aspirational goals. Personal protection goals are goals that give investors financial stability. There are goals that ensure that investors stay grounded regardless of turbulent market conditions. A personal protection goal reduces the personal impact an investor experience due to varying market conditions. It focuses on protecting the investor from the impact of the volatile investment market. For example, if a house is hit by the external impact of windy and stormy rain. What determines whether it stands or falls is the internal impact that it feels. If the house is already designed to absorb the shock of the external impact the house will stand, otherwise, it will fall. The purpose of the personal protection goal is to help investors create a solid protection structure that can withstand the shock of the stormy investment market. If an investor’s wealth can be wiped out by the storm, it is proof investor’s protection system is deficient. Wise Investors focus on building financial stability that stands the test of time. Second, Investors must choose investment vehicles that match their investment goals. Choosing investment vehicles based on goals is the only way to make sure investments achieves their objectives. When investment vehicles align with goals, they produce the right result and return wealth with profit. The fastest way to lose and tie-down money is to invest in the wrong investment vehicle. Third, investors must make decisions and take actions that help them achieve their investment goals. Succeeding in the investment world has more to do with the conduct and attitude of the investor than anything else. One of the greatest mistakes most investors make is to conduct themselves in ways that cancel their investment efforts. Investing this way thwart the achievement of goals and exposes an investor to the exploitation of the market. If Investors must succeed in increasing
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‘
Investors need to take organized actions that are congruent with wealth preservation goals
their wealth they must take actions that are aligned with their goals. These three things are what investors need to thrive in an unstable investment market. The principles of goal-based investing are simple and straightforward but there are not easy. There are not easy because they cut against human nature. While human nature seeks to follow the crowd, bend to peer pressure and invest to prove a point. Goal-based investing follows a disciplined and organized approach that increases personal wealth stability. Investors must find ways to balance their desire to show off with their desire to increase wealth on a long term basis. For investors to thrive in the investment market they must adopt the goal-based investing strategy. The goal-based Investing strategy is goal-driven. It focuses on helping investors achieve financial stability rather than trying to beat the market. It defines investing success based on investor’s goals rather than financial returns. It creates a disciplined and organized approach to grow wealth rather than random acts of investing. This is the only way to enlarge wealth, stay safe. Enjoy peace of mind and control one’s destiny in an unstable investment market. To discover how we can help you enlarge your wealth using the goal-based investing method send an email to info@createsolidwealth.com. Grace Agada is a Generational Wealth Advisor, Legacy Expert and Author of the popular Solid Wealth Book. She is a Consultant and Coach to an exclusive list of top executives and entrepreneurial clients running Businesses from $1-million to $1 billion in size. She help Affluent clients prepare and execute a Ten Generation Wealth Legacy, Diagnostic Family meetings, Family Business Succession, Family Bank Systems, 90 days Sudden death contingency plan, Next generation grooming, and second opinion review of existing Trust and Estate Plans to support generational wealth goals
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Monday 23 December 2019
BUSINESS DAY
insurance today
In association with
E-mail: insurancetoday@businessdayonline.com
Loss Adjusters strengthener’s industry tie for member’s welfare, business growth Modestus Anaesoronye
T
he leadership of the Institute of Loss Adjusters of Nigeria has continued to engage others arms of the industry in away to improving the welfare and opportunities for business for its members. According to the immediate past president of the group under the Institute of Loss Adjusters of Nigeria, Femi Hassan, major achievements of its his administration in the last two years was the synergy between ILAN and other arms of the industry particularly the national Insurance Commission (NAICOM). Hassan speaking at ILANS’s Annual General Meeting in Lagos noted that he was able to secure the confidence of the regulator which led to atraining on oil and gas claims and loss adjusting training program which NAICOM organised for members. He added that the cost of the capacity building program which involved international facilitators and resource persons was borne by the Commission.
Sunday Thomas, Nigeria’s acting commissioner for Insurance (second right) surrounded by insurance regulators of other markets across Africa during African Insurance Regulators Meeting hosted by Nigeria in Abuja
“I believe our members benefitted immensely from the workshop. On our part, we decided to consolidate on the gains and mandated the Committee on Education to explore opportunities to build on the experience. We have consequently signed an MOU with the Centre For Petroleum, Energy Economics & Law (CPEEL) of University of Ibadan in respect of courses that will enhance the
knowledge of our members in the high-tech area of Oil and Gas claims and survey. “Recently, NAICOM eventually acceded to our yearning to increase the tenure of operating licences issued to loss adjusters to two years. This is seen as a positive development that should stabilize the loss adjusting sector of the insurance industry,” he stated. Hassan said the institute
also sought the assistance of members of the NCRIB in reducing the long list of coinsurers in some account with some insurance companies holding as low as 0.5 per cent share with attendant difficulty being experienced in recovering loss adjusters’ fees “and expenses incurred in course of the claim process; either because of the resultant small amount involved or the long list of coin-
surers with majority of them in doubtful financials which has accumulated into huge unpaid debts over the years. In response, the then President of NCRIB, He also noted that Sola Tinubu, the immediate past president of the Brokers promised to convey the prayers to the larger body of insurance brokers with request for their cooperation in reducing the challenges so posed to the fortune of the adjusters,” he added. He posited that his team also met with members of the NIA Governing Council led by their Chairman, Tope Smart on 28th March, 2019, adding that matters of mutual interests were discussed and it afforded both parties the opportunity to highlight areas of dissatisfaction, with pledges to address observed shortcomings. “The immediate fallout of the meeting was an invitation to ILAN to be part of the organizing committee for Year 2020 African Insurance Organizations Conference (AIO) which will be held in Nigeria. We have since nominated two of our Council members, Ike Udobi and M. A. L. Akinwun-
mi to represent ILAN as members of the Conference Organizing Committee,” he said. Hassan said his team also met the Manufacturers Association of Nigeria (MAN), adding that the visit afforded an opportunity to increase ILAN visibility and facilitate positive interaction with representatives of the manufacturing sector who more often than not are recipients of our services. Also visited was the Lagos Chamber of Commerce and Industry (LCCI), which according to him helped created improved relationship with members of the organised private sector and also helped to create awareness and understanding of the role of Loss Adjusters in the process of claims management. He maintained that two books which ILAN will be contributing towards CIIN examinations for would-be Loss Adjusters are due for submission to council this month, stressing that the books would be passed to the CIIN for further action. “It is my hope that the two course books will be available to students in the October diet of the CIIN examinations in 2020,” he added.
Universal Insurance set to pursue recapitalisation plans Modestus Anaesoronye
U
niversal Insurance Plc is set to pursue its recapitalization plans, in line with approvals received from its shareholders at her 49th Annual General Meeting (AGM) held in Lagos. The company is set to deploy in motion, strategies that would see it raise N10 billion recapitalization requirement as prescribed by the National Insurance Commission
(NAICOM) for the general business category. The board had sought and obtained the shareholders’ approval to raise the company’s capital through Right Issues, Share Reconstruction, to raise additional equity capital for the company up to the maximum limit of the authorized share capital. According to Anthony Okocha, acting board chairman of the company, the Universal Insurance Plc has over thirty billion registered
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shares and out of which, sixten billion has been issued while 14billion is still warehoused and could be brought up for issuance if need be. The acting chairman disclosed that the company has in its kitty, N6.5billion and would need N3.5billion to make up for recapitalization requirement as a general business insurer. On steps to meet up with the exercise and beat the June 30 2020 deadline, Okocha stated: “More discussion
is ongoing but could not be discussed prematurely. We are also looking at Right Issues, the company is in discussion with core investors and probable foreign influence into your company.” On financials, he said: “notwithstanding the shape and color of the global economy in 2018 and its effect on the macroeconomic landscape in Nigeria, your company recorded about 45per cent increase in gross written premium (GWP) from N753million
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in 2017 to N1.69billion in 2018. Claims expense decreased from N463million in 2017 to N263million in 2018. However our underwriting expense rose from N166million in 2017 to N452million in 2018.” Okocha said it is the intention of the board and management to intensify the corporate strategy in order “to identify the needs of potential customers, their behavior and culture and have an attentive ear to marketfeedback so to create prod-
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ucts that will address them. He disclosed that the company would continually invest in information technology so as to create an insurance driven by technology that will not only deliver services real-time and in seamless manner but will also deliver on the numbers, adding that the Universal brand has stood the test of time and the values created over the years are embedded in the loyalty and commitment the firm has enjoyed from all stakeholders.
Monday 23 December 2019
BUSINESS DAY
insurance today
27
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Retail, penetration gets a boost as CHI secures approval to operate micro life insurance Modestus Anaesoronye
M
ajor incursion into the retail space, which is expected to deepen insurance penetration at the grass roots will soon be seen in the nation’s insurance industry. This is coming on the heels of major players taking up license to operate core micro insurance subsidiaries, rather than as a window. When the pronouncement for fresh license was made by the National Insurance Commission (NAICOM) over a year ago, not many conventional insurers showed interest, as most applications came from outsiders who wanted to have stake in the industry, no matter how small. But with Consolidated Hallmark Insurance (CHI) Plc, a major player in the industry coming up with the license, the landscape will no doubt have a new look. Obinna Ekezie, chairman of CHI PLc made the disclosure when addressing shareholders during the Company’s Extra Ordinary General Meeting to approve additional capital raise for the Company held in Lagos. He said that the micro insurance subsidiary is scheduled to commence full operations in the first quarter of the year 2020. Ekezie had noted that this approval is considered a demonstration of confidence by NAICOM in the capacity of CHI Plc to successfully operate a Micro Life Assurance business, having successfully delivered on its General Insurance business line.
Eddie Efekoha, MD/CEO,Consolidated Hallmark Insurance
Commenting on the development, Eddie Efekoha, managing director/CEO of CHI Plc who doubles as the current president of the Chartered Insurance Institute of Nigeria (CIIN), said the operational license would further help in the effort to deepen the retail segment of the insurance market. “We are set to take off”, he said, “having put in place a robust network of retail and agency team that have contributed and continue to contribute immensely to the growth of the parent company. The future is in retail business and micro insurance if we are to reach the mass of the Nigerian people with quality, reliable and affordable insurance solutions, he said. According to him, this low-income segment has remained largely untapped and we are ready to give it our best shot”. According to Efekoha, the business office for the microinsurance company has since been acquired and ready for occupation by the new team.
The business will leverage on technology and strategic partnerships to give its customers an exciting insurance services experience. Micro insurance is defined as the type of insurance developed for the low-income segment of the population. Such insurance is expected to be low valued with simple features, easy to understand and whose delivery/distribution channels must be efficient. The Insurance Industry Regulator, National Insurance Commission (NAICOM) had in 2018 released a set of Guidelines for Micro Insurance Operation in Nigeria. The document clearly set out various steps for registration of micro insurance operators, and their modus operandi. In order to ensure a more extensive reach amongst the population especially at the grassroot level, the regulator classified the operators into three categories – unit (local) state and national operators. Minimum Capital Base for Micro Insurance Operators was pegged at N15m for Life
operators at the Unit level and N25m for General Business operators while N200m and N400m minimum Capital Base was fixed for Life and General Business operators respectively at the national level. These are part of efforts by NAICOM to boost insurance penetration through as many Micro Insurers as possible that are expected to operate in the over 700 local government areas of the country. With the ostensibly affordable capital requirement, -there is an envisaged departure from the current concentration of underwriters in a few urban areas with focus on big ticket transactions and move into the hinterlands. The maximum sum insured for any policy being underwritten by the micro insurance operators is pegged at N2m while time limit for payment of fully documented claims is 48 hours, according to the guidelines. With the approval by NAICOM to commence operations, CHI Micro Insurance Limited is set to deepen the insurance penetration by ensuring that those who had never considered themselves able to afford an insurance cover can now do so.The insurance premium can be as low as N1,000 to upwards of N5,000. The products will be tailored to meet the needs of the customers. Consolidated Hallmark Insurance Plc, the parent company, has already established itself as a company that delivers on its promises and pay claims promptly. This same high quality customer fulfillment will be extended through its new CHI Micro Insurance Limited, life assurance subsidiary.
Funmi Omo named amongst top 100 women CEOs in Africa Modestus Anaesoronye
F
unmi Omo, chief executive officer of Nigeria’s foremost life insurer, African Alliance, has been named amongst the top 100 women CEOs on the continent by Reset Global People in partnership with Pulse Media and Avance Media. According to the organisers, “…the list is to recognize and celebrate the performance and excellence of peak women performers in the limitless business world across the vast continent of Africa. It is an acknowledgement and appreciation of the women leaders who intro-
duce innovation and lead the change.” Stating further, the organisers listed the criteria for the award to include the size and importance of the womanled business in the economy, the health and direction of the business, the arc of the woman’s career and social
Funmi Omo www.businessday.ng
and cultural influence. Reacting to the honour, Bankole Banjo, Brand, Media and Communications manager, African Alliance, , said the accolade was well deserved and represents an endorsement of the giant strides of Omo in less than two years as the MD/CEO of the legacy life insurer. “Funmi is a change agent with glowing management and leadership skills that have brought African Alliance out of the doldrums and into reckoning. Really, we are not surprised this accolade has come at this time, her standout achievements are right in the open for everyone to see. Funmi has stabilised the business and put firm structures
in place that succeeding generations can build on; we are indeed proud to be associated with her.” Recall that earlier in the year, Omo led African Alliance through a rebranding process, the first in its 59-year existence. The rebranding has seen the life insurer adopt a robust digital strategy, improve her internal processes, increase its market share and steadily grow its premium income while fulfilling its obligations to its teeming customers. These growth amongst others helped the company clinch an impressive BB+ rating from a lowly BBB- two years ago, according to Agusto, the financial ratings agency.
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Royal Exchange names Wale Banmore GMD, John Iwuajoku GED, in new growth plan he Board of Directors of Royal Exchange Plc, Nigeria’s leading Insurance and Financial Services Group has announced the appointments of Olawale Banmore as the new group managing director (GMD) while John Iwuajoku has been appointed the group executive director (GED), Operations. Both appointments are effective, December 4, 2019. Announcing the appointments, Kenneth E. Odogwu, chairman, Board of Directors, Royal Exchange Plc, said that Banmore, with his extensive experience and knowledge of the insurance industry, will seek to drive the continuous growth and profitability of Royal Exchange Plc and make the Group a market leader in Insurance and Financial Services in Nigeria, while John Iwuajoku will focus on digital transformation, corporate restructuring and operational efficiency across
He is an associate member of the Chartered Insurance Institute of Nigeria (ACIIN); a member of the Africa Insurance Organization; a member of the Nigeria and South Africa Chambers of Commerce and an alumni of the Lagos Business School. He joined the Company in 2003 and acted in various managerial capacities within the Company. He was the Managing Director of Royal Exchange Prudential Life Plc, a subsidiary of Royal Exchange Plc from 2011 to December 4, 2019. Prior to this appointment, he was seconded to Royal Exchange Plc by the Board of Directors to oversee the affairs of the Royal Exchange Group in October, 2018, while still being the Managing Director Royal Exchange Prudential Life. JohnIwuajoku is a consummate finance expert with over 23 years professional experience in the financial services industry. He joined the Company in 2018 as the
Wale Banmore GMD
John Iwuajoku GED
the group. According to Odogwu, these two appointments were done in order to ensure that Royal Exchange Plc continues to seek and take advantage of the numerous opportunities that abound in the financial services sector. Besides, the new GMD and GED will work together and oversee the five subsidiaries in the Royal Exchange group and ensure all companies are positioned for growth, expansion and profitability. Wale Banmoreis a seasoned Insurer with over 27 years on the job experience in the insurance Industry. He is a graduate of Sociology from the University of Ibadan and holds a Master’s Degree in Managerial Psychology from the same institution.
Chief Operating Officer. Prior to joining the Company, he was Vice President at First City Monument Bank, Nigeria where he held several top positions, which included Head Branch Coordination, Head Service Management, Head Shared Services, Head Card and Electronic Banking. John holds a Bachelor’s degree in Economics from the Obafemi Awolowo University and Masters in Business Administration from the University of Calabar. He is an Honorary Associate of the Chartered Institute of Bankers of Nigeria; Fellow, Institute of Information Management; Fellow, Chartered Economist of Nigeria and Member, Nigeria Institute of Management.
Moderstus Anaesoronye
T
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Monday 23 December 2019
BUSINESS DAY Harvard Business Review
MONDAYMORNING
In association with
Principles for improving health care around the world DAVE A. CHOKSHI
G
rowing evidence demonstrates that social determinants of health, such as housing and education, are at least as important as medical services in generating health outcomes. At NYC Health + Hospitals, the largest public health care system in the United States, I have helped design a strategy around population health, a more proactive approach to addressing avoidable human suffering. Four principles undergird the strategy: 1. Local health systems must identify the group of patients for whom they are accountable. While this attribution of patients to clinicians — for instance through “accountable care organizations” in the United States — may seem straightforward or mundane, it is fundamental to systems setting up care models that are not solely contingent on patient visits. 2. Effective health systems are increasingly grounded in high-quality communitybased care. Of the 218 essen-
tial, cost-effective interventions identified by the Disease Control Priorities Network, 140 are delivered through primary care centers or community- and population-based approaches, rather than through hospitals. 3. Due in part to the evolu-
tion toward community-based care, health systems around the world are starting to “meet patients where they are,” both physically and in terms of their health trajectory. Technology — particularly telehealth mechanisms such as text-messaging
and phone or video consultations — enables the delivery of care remotely. 4. A principle common to convergent health systems is the use of data to guide care delivery and drive improvement. Valid, actionable data is lifeblood for
health systems to both motivate change at the front lines of care and to monitor overall performance.
(Dave A. Chokshi is chief population health officer at NYC Health + Hospitals.)
For Alibaba, ‘singles day’ is about more than sales QUE HUY
C
hristmas comes early in China. November 11, known as “Singles Day,” is the world’s biggest 24-hour shopping event. The day has come to represent a unifying cultural event of unabashed retail therapy, coupons, lightning promotions and gamified social media campaigns from retailers across the country. The statistics are staggering, both for the sheer volume of sales transacted in just one day and for year-over-year increases that, so far, defy the gradual slowdown in China’s overall economic growth. 2019 was no exception, with e-commerce giant Alibaba reporting sales activity totaling 268.4 billion yuan ($38.4 billion), surpassing last year’s haul of 213.5 billion yuan ($30.5 billion) by nearly 26%. As a comparison, that’s more than 2.5 times the U.S. sales of last year’s Black Friday and Cyber Monday combined.
From the viewpoint of Alibaba and other online retailers in China, then, what is the advantage of Singles Day? Our Hangzhou trip provided a surprising answer. Nearly every employee we spoke to described the challenges of “Double 11” not as a necessary evil, but rather as the
event’s primary added value. They spoke of Singles Day as a stress test that forces the entire organization past its limitations, enabling it to accomplish and become what would be impossible otherwise. Representatives from the Chinese companies we talked
to mentioned several specific business areas where Singles Day annually spurs ambitious next-level change. First, product innovation. According to Chris Dong, global chief marketing officer of Alibaba, as of 2018, 1 million new products are launched on
Double 11. The pre-eminence of Singles Day creates the ideal platform for companies to launch new offerings. Another benefit is silobusting. Silos are a universal problem for organizations; even though managers know it is important to work across teams and units, in the normal course of business they can get along without doing it. Double 11, however, requires allhands-on-deck cooperation. The cross-silo relationships and networks forged in the crucible of Double 11 are apt to deepen with time, if only for the sake of being prepared for the following year’s Singles Day. Finally, nothing brings people together like a dose of adversity, and the demanding regimen of Double 11 fosters greater team cohesion that lasts through the year.
(Quy Huy is a professor at INSEAD.)
Monday 23 December 2019
BUSINESS DAY
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Access Bank Rateswatch Market Analysis and Outlook: December 20 – December 27, 2019
KEY MACROECONOMIC INDICATORS GDP Growth (%)
2.28
Q3 2019 — higher by 0.17% compared to 2.12% in Q2 2019
Broad Money Supply (N’ trillion)
35.26
Increased by 0.66% in Oct’ 2019 from N35.03 trillion in Sept’ 2019
Credit to Private Sector (N’ trillion) Currency in Circulation (N’ trillion)
25.80 2.06
Increased by 1.30% in Oct’ 2019 from N25.47 trillion in Sept’ 2019 Increased by 2.51% in Oct’ 2019 from N2.01 trillion in Sept’ 2019
Inflation rate (%) (y-o-y)
11.85
Increased to 11.85% in November 2019 from 11.61% in October 2019
Monetary Policy Rate (%) Interest Rate (Asymmetrical Corridor)
13.5 Adjusted to 13.5% in March 2019 from 14% 13.5 (+2/-5) Lending rate changed to 15.5% & Deposit rate 8.5%
External Reserves (US$ million) Oil Price (US$/Barrel) Oil Production mbpd (OPEC)
39 67.82 1.80
December 18, 2019 figure — a decrease of 1.75% from December start December 19, 2019 figure— an increase of 3.37% from the previous wk November 2019, figure — a decrease of 0.33% from October 2019 figure
COMMODITIES MARKET
STOCK MARKET Indicators
Friday
NSE ASI Market Cap(N’tr)
Friday
Change(%)
20/12/19
13/12/19
26,526.35 12.80
26,536.21 12.81
Volume (bn)
0.34
0.16
Value (N’bn)
2.34
1.43
MONEY MARKET NIBOR Tenor
Friday Rate
Friday Rate
(%)
(%)
20/12/19
Indicators
20/12/19
Energy Crude Oil $/bbl) Natural Gas ($/MMBtu) 119.91 Agriculture Cocoa ($/MT) 63.30 Coffee ($/lb.) Cotton ($/lb.) Sugar ($/lb.) Wheat ($/bu.) Metals Change Gold ($/t oz.) Silver ($/t oz.) (Basis Point) Copper ($/lb.) (0.04) (0.03)
1-week Change
YTD Change
(%)
(%)
67.82 2.32
3.37 2.20
5.21 (24.08)
2429.00 127.50 67.66 13.57 547.00
(4.33) (8.54) 0.12 (0.29) 2.67
25.46 (2.07) (12.70) (11.48) 26.18
1477.66 17.04 281.25
0.33 0.35 0.02
12.15 (0.87) (14.20)
13/12/19
OBB
2.1400
2.2100
(7)
NIGERIAN INTERBANK TREASURY BILLS TRUE YIELDS
O/N CALL 30 Days
2.9300 2.9500 9.6444
2.7900 2.8500 12.7300
14 10 (309)
Tenor
20/12/19
13/12/19
90 Days
10.3323
13.6600
(333)
1 Mnth 3 Mnths
4.62 4.75
10.57 10.21
(595) (546)
6 Mnths 9 Mnths 12 Mnths
5.23 5.52 5.77
9.21 12.67 13.25
(398) (715) (748)
FOREIGN EXCHANGE MARKET Market
Friday
Friday
1 Month
(N/$)
Rate (N/$)
(N/$)
20/12/19
13/12/19
20/11/19
Official (N) Inter-Bank (N)
306.95 363.55
306.90 363.12
306.95 362.21
BDC (N) Parallel (N)
0.00 363.00
0.00 363.00
360.00 360.00
Indicators
AVERAGE YIELDS Friday
Friday
Change
(%)
(%)
(Basis Point)
20/12/19 3-Year 5-Year 7-Year 10-Year 20-Year 30-Year
0.00 10.01 10.84 11.27 11.86 12.88
13/12/19 0.00 9.79 11.11 11.02 11.52 12.44
0 22 (27) 25 34 44
Disclaimer This report is based on information obtained from various sources believed to be reliable and no representation is made that it is accurate or complete. Reasonable care has been taken in preparing this document. Access Bank Plc shall not take responsibility or liability for errors or fact or for any opinion expressed herein .This document is for information purposes and private circulation only and may not be reproduced, distributed or published by any recipient for any purpose without prior express consent of Access Bank Plc.
Friday
Change
(%)
(%)
(Basis Point)
ACCESS BANK NIGERIAN GOV’T BOND INDEX
BOND MARKET Tenor
Friday
Friday
Friday
Change
(%)
(%)
(Basis Point)
20/12/19
13/12/19
Index Mkt Cap Gross (N'tr)
3,347.32 10.46
3,369.73 10.53
(0.67) (0.68)
Mkt Cap Net (N'tr) YTD return (%)
6.94 36.27
7.03 7.18
(1.28) (0.91)
YTD return (%)(US $)
-19.55
-18.61
(0.94)
TREASURY BILLS (MATURITIES) Tenor
Amount (N' million)
Rate(%)
Date
91 Day
2,000.00
4
18-Dec-2019
182 Day
2,000.00
5
18-Dec-2019
364 Day
3,000.00
Sources: CBN, Financial Market Dealers Association of Nigeria, NSE and Access Bank Economic Intelligence Group computation.
5.495
18-Dec-2019
Global Economy In the U.K, gross domestic product (GDP) widened 1.1% year-on-year in the third quarter of 2019, the weakest growth rate since the second quarter of 2012. It is higher compared to a preliminary estimate of 1.0% and lower than the previous period's revised 1.2%. According to the office for National Statistics, private consumption continued to underpin activity amid low unemployment and solid wage rises (Q3: +0.4% qoq; Q2: +0.3% qoq), while government spending rose modestly (Q3: +0.3%; Q2: +1.1%). Contrastingly, fixed investment fell 0.2% in Q3 on lower public investment, less severely than Q2's 0.9% contraction. The net contribution from the external sector was 1.2% points, following Q2's 2.6%-point contribution. In a separate development, the Euro area witnessed the largest trade surplus in over 2 years in October 2019. Trade surplus expanded to EUR 28 billion in October 2019 from EUR 13.2 billion in the corresponding month of the previous year. Exports went up 4.1% from a year earlier to EUR 217.9 billion in October from EUR 209.3 billion in the same month of 2019, while imports dropped 3.2% to EUR 189.9 billion from EUR 196.1 billion. Intra-euro area trade fell 1.4% to EUR 174.9 billion from EUR 177.4 billion in October 2018. The trade surplus with the US increased to EUR 130.6 billion from EUR 116.7 billion, while the trade deficit with China advanced to EUR 166 billion from EUR 151.5 billion as reported by the European Statistical Office. Elsewhere, the Bank of Japan retained its key short-term interest rate at -0.1% during its December meeting, and kept the target for the 10-year Japanese government bond yield at around 0%. Policymakers also maintained its upbeat assessment of the economy, despite a consumption tax hike in October, while offered weaker views on exports, production and business sentiment mainly due to the impact of natural disasters and sluggish demand from overseas economies Domestic Economy Data from the National Bureau of Statistics revealed that inflation rate for November 2019 increased to 11.85% year-on-year from 11.61% in October 2019. This represents a 0.24% rise in the rate compared to the previous month and majorly due to increases in the price of food. Core inflation increased to 8.99% when compared to 8.88% in the previous month and food inflation spiked to 14.48% from 14.09% in November 2019. Food items that saw the highest increases were bread & cereals, fish, meat, potatoes, yams & other tubers and fats & oils. Food inflation on a yearon-year basis was highest in Kebbi state (18.77%) and lowest in Bauchi state (12.44%). In a separate development, The federal government has ruled out any possibility of releasing additional funds to finance the capital components of the 2019 budget. the minister of finance, budget and national planning confirmed this during the public presentation of the 2020 budget in Abuja last week. She also disclosed that government's revenue as of the end of September stood at N4.25tn. She said that with about 10 days to the end of the year, and with the 2020 budget becoming operational on January 1, it would be practically impossible to make further releases to Ministries, Departments and Agencies of government for capital projects and that as at November 12, the Federal Government had released about N1.21tn for capital projects' implementation. Stock Market Indicators at the local stock exchange remained bearish for the week ended th December 20 , 2019.There was increased selloff in mostly bell-weather counters. Consequently, the All Share Index (ASI) dipped 0.04% to end at 26,526.34 points from
26,536.21 points the preceding week. Similarly, market capitalization fell by 0.03% to N12.80 trillion from N12.81 trillion the prior week. We expect that investors to take advantage of the correctional profit-taking and low supply to position ahead of the year-end rally as capital flow and repositioning in value stocks continue. Money Market Rates at the money market mostly declined due to excess liquidity in the system. Shortdated placements such as Open Buy Back (OBB) declined to 2.14% from 2.21% and the previous week. The longer dated instruments such as the 30-day and 90-day Nigeria Interbank Offered Rate (NIBOR) settled at 9.64% and 10.33% from 12.73% and 13.66% the prior week. This week, short tenored rates are expected to hover around current levels due to OMO maturity of N906 billion. Foreign Exchange Market Last week, the naira depreciated across most market except at the parallel market where it remained unchanged week -on-week. The official window saw a marginal decline as it ended N306.95/$, a 5 kobo loss from the prior week, while at the Nigerian Autonomous Foreign Exchange (NAFEX) segment the local currency depreciated by 43kobo to close at N363.55/US$ from N363.12/US$ the previous week. The parallel market closed at N363/US$ same as previous week. This week, rates are expected to remain around current levels with the apex bank's continuous interventions. Bond Market The bond market was bearish for the first time in two months as international investors sold off bonds in a bid to realign their portfolio as the year comes to an end. Consequently, market sell-offs for most maturities across the curve. Yields on the five-, ten- twentyand thirty-year debt papers finished at 10.01%, 11.27%, 11.86% and 12.88% from 9.79%, 11.11%, 11.52% and 12.44% respectively, the previous week. The Access Bank Bond index declined marginally by 22.41 points to close at 3,347.32 points from 3,369.73 points the prior week. We expect that market activities will be mixed due to excess liquidity in the system and investors need for portfolio re-balance. Commodities
Oil prices extended its gains last week as thawing trade relations between the United States and China supported global markets. Bonny light, Nigeria's benchmark crude added 3.32% or $2.21 to close the week at $67.82per barrel. Precious metal prices inched up as the U.S. House of Representatives voted to impeach the President, causing political uncertainty in Washington. Consequently, gold gained 0.33% to $1,477.66 per ounce and silver rose by 0.35% to $17.04 per ounce. This week oil prices are expected to drop due to a crude oil inventory build up. Precious metal prices might trade lower amid increased risk appetite after US Treasury Secretary said the United States and China would sign Phase one trade pact early next year.
MONTHLY MACRO ECONOMIC FORECASTS Variables
Dec’19
Jan’20
363
362
363
Inflation Rate (%)
11.90
11.98
12.1
Crude Oil Price (US$/Barrel)
65
66
67
For enquiries, contact: Rotimi Peters (Team Lead, Economic Intelligence) (01) 2712123 rotimi.peters@accessbankplc.com
www.businessday.ng
https://www.facebook.com/businessdayng
Feb’20
Exchange Rate (NAFEX) (N/$)
@Businessdayng
30
Monday 23 December 2019
BUSINESS DAY
Start-Up Digest
In association with
Wemi Moore: Finding success in music Josephine Okojie
B
re a k i ng i nt o the music industry has always been a challenge for artistes from all genres, but this is not the case with Wemi Moore – a music minister and worship leader. Wemi Moore is arguably one of the most versatile unique gospel artistes currently in the country. She has performed and ministered in several platforms across the country since the age of 15 and has currently launched her debut album titled ‘The More.’ The album comprises seven powerful tracks, focusing on the power in praise, trust in Christ and God’s unfailing love, among others. According to the young entrepreneur, her debut album took about tw o years to produce, as she had to combine working and recording the album together. During the album launch, after her live ministration, the young entrepreneur sold out over 500 copies between 7am and 10:30am. She was inspired to become a gospel artist, owing to her passion for music and love for God.
Wemi Moore
Also, songs from Cece Winans, Whitney Houston, Shirley Caesar, and Anita Baker, among others, inspired her. “My love for God and worshipping God has always been from the beginning and was sealed at a point. I knew somewhere in the future I would develop my musical talent,” Wemi says. “Worship music was a sort of outlet for me at the time. I would worship God
for hours and this helped me in forgetting about the challenges that were going on around me,” she explains. With support from family and friends, Wemi Moore was able to quickly discover her musical prowess. The engineer-turnedentrepreneur says with consistency, hard work, o r i g i n a l i t y a n d G o d ’s grace, she has been able to keep her music career
since childhood. “I started music about 23 years ago as a teenager in the church choir. Then, I used to lead praise and worship sessions at my local church, Foursquare G ospel Church, Onilekere,” she says. “I was also a member of a band, ‘Priests of Praise’, where we would sing all s or ts of contemporar y gospel music at events in the late 1990’s,” she adds. We m i s ay s t h a t h e r songs inspire and bring people to Christ as it ministers’ salvation. She exudes excellence in writing songs through the help of the Holy Spirit. She has been leading worship on various platforms over the years and is currently a worship leader at Daystar Christian Center. She says her debut album - The More- is now available on digital outlets. “I pray that as you listen, the spirit of God takes over your life. Your life begins to shine brighter and you become more and more like Him!” she says. On her advice to other musical entrepreneurs, she says, “Be you. Show love to people around you. Sometimes, they just might be your destiny helpers. Stay focused and let the Holy Spirit inspire you to express the language of music.”
Bhojsons Celebrates 22 entrepreneurs
B
hojsons Plc, a subsidiary of the Bhojsons Group (motorcycle division), distributors of motorcycles, has rewarded 22 entrepreneurs— who are high-ranking dealers— for their contributions to improved business growth witnessed by the company during the 2019 business year. The company honoured the 22 topmost dealers at its 2019 Annual Dealers Conference held in Lagos on Saturday, December 7, 2019, in recognition of the dealers’ remarkable contributions. Three dealers were specially recognised for their significant roles toward the growth of the company in Nigeria. They were Suleiman Mohammed of Sule Torris General Enterprise Limited, John Onyela of John Onyela Enterprises and Obinna Frank of O.O Francis Enterprises.Mohammed emerged the 2019 Dealer of the Year while Onyela and Frank were adjudged the firstrunner up and second-runner up respectively. Speaking at the conference, Kalpathy Krishnan, CEO, Bhojsons Plc, explained that the 2019 Dealers conference was organised to honour and celebrate the dealers for their contributions to the growth of the business while also identifying and understanding the areas the business can focus on for improved growth for the coming years. “We are quite excited to witness this event where we have the opportunity to celebrate our dealers. We pride ourselves in being able to engage all our stakeholders at every level, and our
dealers are not left out of this. While this recognition is a show of appreciation and encouragement to them, the joy for us is being able to sit in a room with them to hear directly on how our products are doing in the market, and ways in which they want us to improve,” he noted. In his remarks, Vishant Dalamal. group managing director, Bhojsons Plc, described the annual conference as an opportunity to express profound gratitude and appreciation to dealers for the immense support, which has significantly impacted on sales and growth volume. While acknowledging the feedbacks received at the conference, Dalamal assured the dealers that the company would not hesitate to take steps in addressing all the issues or complaints in such a manner as to meet and satisfy the yearnings of customers and patrons. “Our customers are our greatest assets and we will continue to appreciate their efforts in every way we can. They contribute a large percentage to our business and we feel it is better to hear from them. That is not to say we don’t respect the views of other dealers as we normally organizes regional conferences that offer opportunity to also get feedbacks. Of course, the business is growing but I feel we can still grow much better,” Dalamal stated. Vijay Balareddy, general manager, sales, Bhojsons Plc, lauded the continuous support of the dealers who have remained absolutely consistent in their delivery of excellent performances.
LSETF wins SME Most Innovative State Government Agency
ANDE West Africa, ACT Foundation partner to train entrepreneurial organisations
n recognition of its contribution to the growth and development of Small and Medium Enterprises (SMEs) in Nigeria, the Lagos State Employment Trust Fund (LSETF) has won the SME Most Innovative State Government Agency at the 2019 Nigeria SMEs National Business Awards. LSETF was established in 2016 with a broad mandate to address unemployment and support entrepreneurship in the state. Over the last three years, the fund has initiated several programmes aimed at strengthening and supporting the micro, small and medium enterprises through access to funding, business support and
Josephine Okojie
I
capacity building. Since inception, it has provided access to funds to over 11,477 beneficiaries with a total loan portfolio of N7.2 billion. In addition to providing access to finance, LSETF provides skills development for unemployed young people. More than 5,403 individuals have been equipped with world-class skills to actualise their potential, get jobs or grow their businesses. Commenting on the award, Teju Abisoye, acting executive secretary of the LSETF, lauded the Association of Small Business Owners of Nigeria for the recognition of the Fund’s impact on the growth of SMEs in Nigeria. “At LSETF, we are delibwww.businessday.ng
erate at fulfilling our mandate of creating jobs and supporting entrepreneurs. We consistently search for better, easier and up-to-date ways to provide the needed support to entrepreneurs resident in Lagos State,” Abisoye said. Speaking further, she dedicated the award to the Lagos State government, board of trustees, management and staff of the fund. The 2019 Nigeria SMEs National Business Awards was organised by ASBON in collaboration with Small Business Club. ASBON is the umbrella body for entrepreneurs in small businesses in Nigeria, with over 12,000 registered members present in twenty-three states of the federation.
T
he Aspen Network of Development Entrepreneurs (ANDE) West Africa, Aspire Coronation Trust (ACT) Foundation and Entrepreneurship to the Point have collaborated to train entrepreneurs on how to measure the impact of their businesses in the ecosystem. The training with the theme, ‘Impact Measurement and Management: A Human-Centered Approach’, was hosted by ANDE West Africa, sponsored by the ACT Foundation, and facilitated by Entrepreneurship to the Point, South Africa. Osayi Alile, CEO, ACT Foundation, in her address of welcome, stressed the importance of Impact mea-
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surement for organisations supporting Small and Growing Businesses (SGBs) as well as the Civil Society Organisations (CSOs), “We have partnered ANDE and Entrepreneurship to the Point, South Africa, to develop a robust training which aims to help participants appreciate the practice of measuring impact of their work within the ecosystem,” Alile said. Also, Joshua Adedeji, programme associate, ANDE West Africa Region said, “What you do not measure, you cannot improve upon.” Adedeji explained that ANDE’s goal for the year is to see entrepreneurial ecosystem actors, especially local organisations, understand what to measure, how to measure, as well as develop a sustainable model for impact management. @Businessdayng
The workshop facilitator, Shawn Theunissen, CEO Entrepreneurship to the Point, South Africa, worked the participant through the human centered approach to impact measurement while engaging them in practical sessions. Daniel Asare-Kyei of Esoko took the participants through the INSYT data collection tool and offered all participants a two-month free access to the tool. Participants gained fresh insight into the practice of impact measurement and management and got recommendations for various tools that could be adopted. Some of the participants at the session included Dalberg, RDF Ghana, Ashesi University Ghana, TechnoServe, Fate Foundation, LEAP Africa, PIND, Wennovation among others.
Monday 23 December 2019
BUSINESS DAY
Start-Up Digest
31
Killing the golden geese Small businesses in Nigeria’s economic nerve centre are squeezed by multiple taxes, and they want quick government action, writes ODINAKA ANUDU
A
s I alight from a commercial bus, popularly called ‘Danfo’ in Lagos, on December 2, I am greeted by the usual cacophony of confused voices. It is Charity, a busy bus stop at Oshodi—considered as one of the most crowded places in Lagos. So many things are happening at the bus stop, but one particular scene catches my attention. A haggard-looking man is pummelling a younger fellow who sells sweets in packets. It is a usual sight in Lagos to see touts, often called ‘agberos’, harassing and battering their victims. So, no one pays any particular attention to this situation, except me and another agbero who is an interested party. It is a brief fight, but it has left the sweet seller with a bloodied nose. The tout had asked the sweet seller to part with N500, but the micro trader had told him he would not be able to. And this angered the tout. “How can they ask us to pay N500 every Tuesday even when we are not sure of making up to that?” he asks, rhetorically, after the brawl, gazing at me. On enquiry, I find that micro traders in the area pay N500 every Tuesday, N300 every Thursday and N150 any other day, including Saturday or Sunday.
Pure and bottled water sellers, plantain hawkers, biscuit sellers and other micro businesses are all compelled to pay these. Many of them are helpless and the total values of their wares are sometimes less than what they pay in one week. I ask the sweet seller how much his goods are worth and he says all of the sweets are valued at N2, 500. Each pack is sold for N50 and he has 50 of them. Mathematically, the sweet seller and other micro and petty traders pay N1, 700 each week. For the sweet seller, this is 68 percent of the total value of his goods. To add insult to injury, the touts collecting these taxes and levies provide no evidence of payments to the payers. So, the petty traders would go to another part of Oshodi and fight over the same taxes and levies they have earlier paid. And there is no guarantee that the tax collectors would render an honest account to the government or anybody they are collecting the taxes and levies for because of absence of tracking tickets or receipts. Happening across Lagos This is not happening at Charity only. My trip to nine local council development areas (LCDAs) in the state, including Oshodi, Isolo, Mushin, Alimosho, Ajeromi-Ifelodun,
Ogunbiyi Community Development Association where touts collect N1,800 each day www.businessday.ng
Source: BusinessDay research
Apapa, Ikeja, Kosofe, and Surulere, convince me it is all the same everywhere. I find that small businesses in these parts of Lagos, including tricycles and motorcycles riders, have gory stories to tell. At the main Oshodi Market, the Kick Against Indiscipline (KAI) officials are chasing micro traders from pillar to post on December 2. KAI is an environmental law enforcement unit established by Lagos State government to monitor and enforce environmental laws in the state. On this day, KAI officials are chasing micro business operators who are not in established shops. Why the chase? At Oshodi, shop rents go as high as N1.2 to N1.8 million yearly. One gigantic building at Oshodi Post Office rents one shop within the building at N1.2 million (upstairs, front) and N1.5 million (for the premium class). The cheapest on that building— perhaps at Oshodi—goes for N800,000. Only a two-year rent is acceptable. Assuming that I go for the cheapest, I will pay N1.6 million ($5,245) as rent. Other places at Oshodi accept no fewer than three years. Many small and micro businesses cannot afford such expensive rent. So, they rent make-shift shops or stay in open places to make both ends meet. KAI considers these businesses as environmental threats and chases them whenever they come. However, the business owners tell me that they are not running because KAI will prosecute them, but because of how much they will part with if their foods are confiscated by the agency. I am told that KAI officials collect between N1,500 and N10,000 for goods they seize. “Every now and again, we give KAI officials N200 to
A street trader at Mushin
stop them from ‘disturbing us,” a woman, who identifies herself as Ajala Okebukola, says. The exploitation continues The petty traders at Oshodi, who are being chased by KAI and other government agencies, pay N550 each day from Monday to Wednesday, N850 on Thursday, N950 on Friday and N1, 050 on Saturday. Only a N50 ticket from Oshodi LCDA is given to the traders out of all the fees and charges they pay. Worse still, the charges have no name. One tout, identified as Ishola, asks a micro trader to pay N200 for land use. This is different from the Lagos State government’s Land Use Charge, which is paid into an official account. All of the taxes and rates are collected as cash, contrary to the pronouncements of the Lagos State government. Tricycle riders at Os-
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hodi pay between N1,200 and N1,800 each day, while their motorcycle counterparts pay N600 to N800 to touts. At Isolo, a neighbouring local council, the situation is not different. Tricycles pay N1,500 to N2,100 every day. One ticket (N100) is for the state government; one is for the Tricycle Owners Association of Nigeria (TOAN), and another for the National Union of Road Transport Workers (NURTW), which takes the largest share. Two hundred naira is for the police, and N200 for the Lagos State Traffic Management Authority (LATSMA), the riders tell me. More so, commercial motorcyclists pay N4, 000 to N5,000 for riders’ card each year. Once you open a shop at Isolo, you are mandated to pay N5,000 to N6,000 as trade license fee/lock-up shops rate, and N250 for @Businessdayng
radio/ television license annually. The small business is also compelled to pay the Lagos State Signage and Advertising Agency (LASAA) rate of N14,000 to N200,000 if they have signposts. At a popular Aswani Market at Isolo, which is busiest on Tuesdays, micro traders pay between N400 and N500. “Alhaja collects N200; Alhaji collects N100, and local government council takes N100,” a female trader tells me on December 10. Alhaji (male) and Alhaja (female) are male market heads. Many markets in Lagos also have ‘Iyalojas’ and ‘Babalojas’ who are female and male market heads respectively. They wield so much power—sometimes to the detriment of small businesses. At Otigba Cluster, popularly known as Computer Village, located at Ikeja LCDA, traders without standard shops at Ogunbiyi Community Development Authority pay as high as N1,800 every day. The money is collected by three sets of touts who do not issue receipts or tickets for the payments. Some of them claim to be ‘land owners’ while others pretend to be working for the local government. “Some of us have decided to stay outside of that place. Yet, we pay N25,000 every year to the ‘area boys’,” a trader, who prefers anonymity because of her safety, tells me. ‘Area boys’ are special touts who operate within a geographical area, claiming ownership of the community as land owners. If you are a tricycle rider operating between Ikeja and Ogba, you will crisscross four LCDAs and pay N600, apart from the regular N1,200 to N2,000 given to four groups of revenue collectors. In Apapa LCDA, the situation is not different. Motorcycle riders, also known as ‘Okada’, plying from Ijora to Apapa are given two tickets: One for the local government, and another for the Motor Cycle Association of Lagos, an arm of the NURTW. Despite that N50 is printed on the NURTW ticket, touts along that axis collect N100 from motorcycle riders. At Boundary Market in Ajegunle, Ajeromi-Ifelodun LCDA, touts collect N1,000 from motorcycle riders and another N200 for those plying in the evening. “The police, who are supposed to protect, take N200 Continues on page 32
32
Monday 23 December 2019
BUSINESS DAY
Start-Up Digest
Killing the golden geese Continued from page 31
every evening,” one Adamu Muhammad, a motorcycle rider, tells me. Micro businesses pay between N400 and N1,000 in this area. Once again, no evidence of payment is extended to these payers. At Mile 12 Market and Ketu, both located in Kosofe LCDA, the situation is not different. Micro businesses are hunted like preys by uniformed NURTW officials who are more powerful than even state-designated tax collectors. Traders pay N400 to N600 each day, while tricycles register their business with N5,000 to N15,000, and pay N1,500 to N2,000 each day. “Life in Lagos is hard. No jobs, but when you take up anything, the agberos, police, and others will squeeze you,” one tricycle rider, who says he is a polytechnic graduate of Banking and Finance, tells me. At Mushin, each tricycle rider pays N3, 300 every day to four different groups, which include the NURTW, the local government, the state government and to the Tricycle Owners Association of Nigeria (TOAN). This does not include N200 each day for the police and another N200 for the Lagos State Traffic Management Agency (LATSMA). Only two tickets of N100 and N50 are issued by the payees. Motorcycles pay N600 each day, and roving micro businesses pay N500 to N650 each day without any ticket issued or shown them. Undercover exposes corruption As small businesses bear the brunt, private individuals ensure the money enters their own bank accounts, rather than the state’s or the local government’s. The first part of this story exposes how public funds belonging to the Lagos State Signage & Advertisement Agency (LASAA) at Isolo LCDA is paid into the private account of an individual, Assumpta Omozejele, who is in charge
of the agency in the LCDA. I went undercover, posed as a trader at Isolo LCDA and paid money belonging to LASAA into her Zenith Bank account as she instructed. In a recorded phone call, she reduced the amount I was to pay from N28,176 to N13, 000 and read out her account number to me. I paid the agreed amount on December 10 and demanded a receipt in a text message the following day. “Don’t worry, it does not matter am the only one in charge of Ajao but if you still want it you can come around,” she had replied in an unedited text message. At Mushin LCDA, I had met a man, Aliu Olaoye, who claims to work as a member of task force. I told him I had a shop at Isolo Road and he asked me to pay a parking permit of N30,000 and shop fee of N5,500 into his Polaris Bank account. In a recorded telephone call, he promised to pay N20,000 to Mushin Local Government, while he and ‘the leader’ would pocket N5,000 each. “Oga, this is Mushin. As you know me, nobody will touch you except the person wants to die,” he had told me. At Alimosho LCDA , I asked two young men the way to the revenue office and they claimed they were in charge of it. One of them gave me his account number to pay in shop permit of N3,500 for 2019, despite that it was fewer than three weeks to the end of the year. This happened in many other LCDAs I investigated. Lagos is Africa’s fifth biggest economy, with a gross domestic product of $90 billion. Its Internally Generated Revenue (IGR) exceeds N20 billion each month, but population (over 20 million) far outstrips government capacity. The state lacks good infrastructure projects but leaks revenue needed to build them to certain individuals.
Aswani Market at Isolo LCDA where ‘Alhaji’ and ‘Alhaja’ collect their own individual taxes
and the Small and Medium Enterprises Development Agency (SMEDAN) says the number of small businesses in the country rose from 37 million in 2013 to 41.5 million in 2017. They contribute 47 percent to Nigeria’s Gross Domestic Product and create half of the jobs in the economy. They make up 95 to 98 percent of businesses in the country, providing easiest route for employment and entrepreneurship. “One small business can employ three, four, five, six people once you empower it,” Waheed Olagunju, former head of small businesses at the Bank of Industry (BOI), says. “They make more impact than even the large enterprises,” he further says.
Small businesses squeezed As I move from one LCDA to another, I see why business experts say one out of three small or micro businesses in Nigeria dies within the first three years of life. Small businesses in Lagos, like those in other parts of the country, are hard hit by lack of cheap and longterm funds for expansion, poor infrastructure and policy flip-flops. Roads are bad, and the state is, perhaps, the only mega city in the world without a light rail system— making logistics cost high. In terms of funding, the Monetary Policy Rate (MPR), which is a benchmark interest rate in Nigeria, is 13.5 percent. Other African countries have done better. Ethiopia which is 7 percent; Kenya is at 9 percent; South Africa
The golden geese Small businesses are the geese the lay the golden eggs. A latest report by the National Bureau of Statistics
N50 printed on the ticket but the real charge is N100 www.businessday.ng
Micro business operators run to hide their goods as they saw KAI officials on December 2 https://www.facebook.com/businessdayng
at 6.75 percent; Zambia is at 10.25 percent, and Cameroon is at 4.25 percent. As a result of MPR, commercial banks in Nigeria lend at 20 to 35 percent interest rate to small businesses. But multiple taxation remains a major challenge. But the greater challenge is, perhaps, taxes charged by the local government. “Radio and television taxes are relics of colonial times,” Toki Mabogunje, president of the Lagos Chamber of Commerce and Industry (LCCI), tells me. “I really do not think we should have them now. I think technology has changed the equation, especially now that lots of these broadcasts are done with completely different technology. So, these are things that should be reviewed,” she says. Muda Yusuf, directorgeneral of the LCCI, tells me that he knows of someone who has been asked by a local government to pay N200,000 ($656) as radio and television taxes. Legitimate taxes/levies The website of the Lagos Internal Revenue Service lists approved state taxes as personal income tax (imposed on individuals in employment or running businesses), Pay As You Earn(deducted from salaries), capital gains tax (paid on profit made from sale of capital assets like land), stamp duties (imposed on legal documents/ instruments), business premises (tax on property), land use charge (imposed on land used for business) and withholding taxes. Local governments have various charges ranging from shop permits to park rates. However, I find that businesses merely dole out money to touts without knowing what they are paying for. Only one out of over 30 small business owners I have interviewed knows what they pay for each day. Death of micro businesses In Nigeria, unemployment rate is 23.1 percent, according to the National Bureau of Statistics (NBS). Unverified data from Lagos State government say 6,000 people come into Lagos daily. Many of the new entrants, in order to survive, start micro and small businesses. But experts say these businesses die because of many reasons, one of which is multiple taxation. The latest report by the NBS and SMEDAN says 2,877 businesses in Nigeria shut down between 2013 and 2017. In August 2016, the Manufacturers Associa@Businessdayng
tion of Nigeria (MAN) and the NOI Polls reported that 222 small-scale businesses closed shops in one year, leading to 180,000 job losses. End haphazard tax system with Experts want Lagos State government and all LCDAs to automate revenue processes to halt leakages and save small and micro businesses from demise. “The state should designate accounts for payments of all levies and taxes, and start a campaign to educate people on why they must pay into official accounts,” Emeka Amadi, head of tax at the United Bank of Africa, tells me. “Just automate the process. There must a mechanism for punishing people who extort money from businesses after they pay their taxes,” he recommends. Yusuf of the LCCI says only automation of the processes can make a difference. “Urge people to pay into the bank and monitor the process,” he further said. Ike Ibeabuchi, managing director of MD Services Limited, a servicing and manufacturing outfit, says public offices should not be used to compensate individuals after elections. “People who pay these fees into private accounts should know they are taking a risk. So they should also be bold enough to report any official who wants public funds paid into their private accounts,” he suggests. Mabogunje, president of LCCI, has worked as a consultant for SMEs since 2000. “There was something we did in Enugu State that Lagos can copy,” she says. “What we did was education around tax. We educated tax payers on what they needed to know or do. The director of tax was engaged to draw up, in a single sheet, legitimate levies and taxes that small businesses were expected to pay. “They were now educated on what these things were supposed to be so that if anyone came to demand anything not on that list, they would resist them. What they were encouraged to do was to report those issues. Once those things were reported, the state government took on those reports and took some internal actions. “On the side of government, our view is as far as you are a micro or small business and you are earning below a certain amount, you would not exceed a certain level of payment as your tax contribution. Many countries in South-East Asia have tried it and it has worked,” she recommends.
Monday 23 December 2019
BUSINESS DAY
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Monday 23 December 2019
BUSINESS DAY
real sector watch
In brand push, FMN boosts logistics to drive market penetration BUNMI BAILEY
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lour Mills of Nigeria (FMN), a Nigerian conglomerate, is aggressively pushing its brands further into the market by boosting logistics for partners and distributors. Logistics has become a critical element for manufacturers, with increased competition and higher market share becoming success factors. Many manufacturers like FMN spend 20 to 30 percent of their expenditure on logistics as the country grapples with absence of good road network and light rails needed to support movement of goods and persons. FMN, a market leader in food and allied industries, recently rewarded top- performing distributors in the food segment with 11 trucks to enable them meet logistics needs and capture more customers. The company said it rewards distributors every financial year based on their performances and supports them to expand operations and boost product penetration. Devlin Hainsworth, managing director, Foods, said the gesture was targeted at
fulfilling FMN’s vision of feeding the nation every day. “We are here today to make good of our promise that we made in June 2019. For nearly 60 years, we have been in partnership with you to feeding and nourishing the nation everyday with our products,” he said. “And the success we have had in taking our products to the nation is based on the partnership we are enjoying with you,” he said.
Hainsworth said he was excited that the vehicles were going to work in the distributors’ businesses. “I am excited that the vehicles are going to work in achieving more in terms of realising the opportunities that is out there for our brands and your businesses,” he said, while addressing the distributors. Amongst the distributors that were rewarded were: Oluwasesan Sose, chief executive of Oluwasesan Sose
L-R:Azubuike Emechebe, coordinator, UNIDO Regional Centre For Small Hydro Power; Iyalode Alana Lawson, immediate past president of NACCIMA; Olusegun Obasanjo, Nigeria’s former president; Jean Bankole, UNIDO representative to ECOWAS & regional director, Nigeria Regional Office Hub, and Helen Iji, senior assistant to UNIDO director, during a meeting with Obasanjo in Abeokuta, last Wednesday.
FrieslandCampina WAMCO now has new app for dairy production ODINAKA ANUDU
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wo students of the University of Ibadan and three research students from the Delft University of Technology, The Netherlands, have developed a mobile software application to help dairy farmers to perform better. Named the ‘mDairy App’, according to Ore Famurewa, the company’s spokesperson and executive director, corporate affairs, the effort is being made in partnership with FrieslandCampina WAMCO. “The three students from the Delft University of Technology and the mDairy app co-founders are collaborating to support local dairy farmers at our different Dairy Development Programme (DDP) sites,” Famurewa said. The Dutch students are Margot Ridderikhoff, Jaap Dechering and Betsie Loeffen while the mDairy’s cofounders are Oyewale Abioye and Gbadegesin Alawode. In 2017, FrieslandCampina
Investment & Property Limited; Murtala Abdullahi, chief executive of Muabsa Integreted Services; Modinat Sanusi, CEO of Opeyemi Baking Industry, and Dosunmu Fumilayo of DMF Foods Multiventures, among others. Paul Udochi, head of sales, B2B, said last year, the company gave 17 trucks to its topmost distributors, disclosing that there were still additional five trucks to be given out soon.
WAMCO partnered with the Dutch-Nigerian Students Business Challenge, an initiative of the Dutch Foreign Affairs Ministry and sponsored by corporations mainly of Dutch origin. The initiative aims to address challenges in Nigeria’s health, energy and food sectors. Having successfully completed and presented relevant business solutions, a new team of three students attached to FrieslandCampina WAMCO came to Nigeria recently to join Oyewale
and Gbadegesin in order to deploy mDairy App, which DDP farmers can use with little or no challenge. To ensure that all farmers from various socioeconomic backgrounds are integrated, the team is also developing an interactive voice message service which would facilitate easy access. “The mDairy app once deployed is designed to serve as one-stop-shop for DDP farmers’ information needs,” Famurewa explained.
L-R: Adebayo Akinade, dairy extension manager, FrieslandCampina WAMCO; Margot Ridderikhoff, Jaap Dechering and Betsie Loeffen, students of Delft University, The Netherlands; Tijani Abdulah, Baale, Fashola community, Oyo State; Oyewale Abioye and Gbadegesin Alawode, University of Ibadan students, with Henry Adaobor, Dairy Development Programme (DDP) administrative manager during a visit of the team to Fasola, Oyo State, recently www.businessday.ng
Modinat Sanusi, CEO, Opeyemi Baking Industry, said FMN’s truck would help grow margins and scale his operations. “I am excited about this because this will help ensure effective re-distribution of Golden Penny products which will translate into higher volume of sales and returns for my company. We appreciate FMN for this and hope for bigger and better ones,” he said. FMN is a Nigerian agribusiness company founded in 1960 by George S. Coumantaros as a private limited company and in 1978 became a public company, with its shares listed on the Nigerian Stock Exchange I n Nov e m b e r, F M N, through the ‘Feed Your Love’ campaign, rewarded couples who entered the campaign by submitting a short video message, disclosing why they loved Golden Penny. Several entries were received, but only seven of these entries were adjudged winners after their posts received the highest interactions. The seven couples from the first round then had to post a second set of videos after their weddings. The couples whose video got the most interaction after this
process was later selected as winners of the grand prize of an all-expense-paid honeymoon to Dubai. David Olaleye and his wife, Enitan, won the prize of an all-expense paid honeymoon to Dubai. In 2018, FMN gave out trucks to distributors in a strategic move to motivate and enable them grow their businesses. Paul Gbededo, group managing director, Flour Mills of Nigeria, had said the recognition and support meant the company was helping to boost the businesses of its partners, dealers and customers. “Once they grow, you can be sure FMN will continue to grow,” Gbededo had said. Adding, he said, “ FMN is fulfilling a promise it made to various categories of customers earlier in the year that it would provide them with vans to support their businesses to enable them take goods from its factories to their warehouses and from warehouses to the retailers. “This is just the start. In years to come, we are going to be doing it in tranches so that we will be seen to be feeding the nation every day.”
Nobex pioneers standard in Africa’s cassava processing value chain
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he Natural Resources Institute (NRI) of the University of Greenwich, United Kingdom has highlighted the pioneering effort of Nobex Tech, an indigenous Nigerian company, in setting the standard for quality and after sales services of cassava drying equipment in Africa. The Institute said it first came in contact with Nobex Tech in 2006 while exploring home-grown solutions to address post-harvest losses in cassava, under the CAVA and CAVA2 projects that lasted till 2019, supported by the Bill & Melinda Gates Foundation. “Striving to expand and develop processing capacity for SMEs, a key issue of availability of quality equipment and after sales service was identified and this led NRI to approach Nobex Technical Company Limited, a Nigerian manufacturer that has specialised in equipment for drying and
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roasting cassava. “One of the machines that Nobex fabricates is a ‘flash dryer’, so called because it dries agricultural products almost instantaneously. Once harvested, the crop needs to be processed quickly, for fresh cassava roots begin to deteriorate 72 hours after harvest,” the institute explained in a recent release. Specialists from the Federal University of Agriculture, Abeokuta (FUNAAB) led by Lateef Sanni, country manager of CAVA Nigeria, and Andrew Graffham, a food processing specialist from NRI, as part of a FUNAAB-NRI collaboration, had encountered a Nobex flash dryer at a factory in Akure, Ondo State. This led to collaboration between Idowu Adeoya, MD of Nobex Tech, his team of engineers and NRI agricultural engineering specialist, Andrew Marchant. Their combined effort produced @Businessdayng
an improved machine that significantly lowered production costs. Fuel usage decreased from 374 to 65 litres per tonne of dried product ; output increased from approximately 100kg an hour to around 330kg an hour of dried product, while efficiency climbed from 11 to 55 per cent. Since then, machines based on this design have been exported to eight countries in Africa, with multiple sales in Nigeria. “Building on CAVA2’s experience and progress with Nobex in Nigeria, a complementary initiative is taking shape in Ghana, with the development of a new, fuel-efficient flash dryer on a smaller scale,” NRI disclosed. Apart from processing, other challenges in the cassava value-chain include increasing yield, managing pests and diseases, and transporting the bulky roots by road.
Monday 23 December 2019
BUSINESS DAY
35
INTERVIEW
‘Nigeria has been slower to adopt solar power than East Africa’ SIMON BRANSFIELD-GARTH is the current CEO of Azuri Technologies, a business that combines the latest solar innovation with mobile payment technology to bring affordable, clean energy to the 600 million people in sub-Saharan Africa that have no access to reliable electricity. In this interview with DIPO OLADEHINDE, Bransfield-Garth explains how he has developed Azuri Technologies into a major pay-as-you-go off-grid solar home solutions provider with a vast network of agents and distributors across sub-Saharan Africa.
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ow has Azuri Technologies leveraged its platform to deepen its roots in Nigeria’s solar market? Azuri is providing solar home systems across sub-Saharan Africa, enabling households that do not have the grid at all or have a very intermittent grid to be power normal household devices like television, a radio, and charge phone. The main problem with solar power is that you have to buy a piece of equipment upfront and this is very expensive. So Azuri tries to provide solar on what we call Pay As You Go, where we put the equipment in your house for a small amount of money and then you pay a small fee every week in order to be able to use the system. You are able to benefit that without having to purchase the equipment with a large amount of money upfront. Then you pay this fee for two and half years for the system to become yours and you will no longer have to pay anymore. You have free TV, free lighting, free power for other things. Most of the customers of the system are people who either have no grid or have an intermittent grid and are spending a lot of money already on diesel in order to be able to power their houses. What role do you see solar playing in Nigeria’s economic development? I think solar has a really exciting potential within Nigeria, we all know that Nigeria has challenges with power. So there are roughly 50 percent of households that don’t have power at all and all those households that have power only have for a certain period during the day. One of the things you can rely on is that the sun is going to rise day in day out. So there is no question of whether that is going to happen and solar power enables people to have electricity every single day absolutely guaranteed. But, there are some devices that solar power can’t power. It is difficult to use solar to power a kettle or iron, but there are many devices that solar can power like TV, radio, lightings, and fridges among other devices used on a daily basis. So we can use solar as that mechanism that sits alongside the main of electricity and enables one to get free access to power and your basic goods
what they all tell me is how pleased as they are able to turn their generator set off so they don’t have a generator running at night, running for much of the day, and can get rid of the fumes and other things associated with generating set. Now, that does not mean people get rid of their generating set. They still might use it for few hours a day to run a freezer, for example, and for other devices but what it does mean is that people don’t have to run their generating set 24 hours. They can run for a much shorter period of time and instead use solar to power these devices.
and households and then if you need the grid in order to be able to power high powered devices, then that would be a personal choice for the individual households. Is Nigeria ready for solar deployment? Interestingly, solar power has really taken off in East Africa and historically Nigeria has been slower to adopt solar power than East Africa. What we see now is solar being used in a big way in Nigeria replacing bigger systems, replacing larger TV, or fridges and other devices which in East Africa is not been used for. We really think that Nigeria is ripe on the edge if adopting solar power in a really big way.
the idea of pay as you go which enables people to access mobile phones affordably, and that was really what made mobile phones become a mass-market product that everybody can access. Solar is essentially the same thing. But people still spend a lot of money on the alternative to solar power. So whether that is petrol in your generator, or kerosene in your lights, candle, whatever it may be, people are spending a great deal of money. Currently in Nigeria, we are able to offer a TV and a fan for less than the cost that people are spending on petrol. So as far as the customers are concerned, it is cheaper to have solar power.
What is the major challenge facing solar energy in Nigeria? Solar penetration in Nigeria today is just less than one percent of households. If you look at East Africa it is becoming much larger. These are the countries that have more than 10 percent of households with solar power and the number is growing quite fast. So, we think Nigeria is at the point where there is a big market but hasn’t been really served until now and the time is now to be able to get the individual households.
Do you think low-income earners will accept this pay-as-you-go considering the level of poverty? I will draw on the experience of what has happened in other countries. So pay-as-you-go is found in many countries in sub-Saharan Africa. It is particularly strong in Kenya, Uganda, Tanzania, Senegal, Togo, Cote d’Ivoire, Ghana, a whole range of other countries. Nigeria historically has not had pay-as-you-go partly because mobile money technology has not taken off in Nigeria which is not the case in other countries. But we think Nigeria is absolutely ripe now to be able to adopt a pay-as-you-go.
How did you come about pay-as-you-go system? The pay-as-you-go essentially originated from mobile phones technology. So, if you remember the early days of mobile phones, then you have to have a contract and very few people could afford it. As a result, mobile carriers came up with
What has been your experience in Nigeria? Our experience has been great. I was out in Ogbomosho talking to customers who had TV and other solar appliances and
Despite rising demand, power generation has remained low. What would you say is the major challenge in the energy value chain? There are a lot of challenges in energy everywhere. Clearly, there are some technical things that need to be addressed with the structure of energy. But also one of the big challenges is that the population continues to grow at a rapid rate. Even if energy is provided more quickly, very often the population growth is outstripping the growth of energy delivery. But also delivery energy in a conventional way works really well if you are in an urban center and much more difficult if you are in a rural area. The cost of wiring up a customer who is 10 kilometers from the nearest road is really very high whereas solar systems don’t require any infrastructure. You literally go to the house, install it in that house and it is done. So there is a large number of customers that are much better served by stand-alone solar. There are customers who have the grid and there are customers in the middle where they have grid but the grid is not reliable enough. They want solar as a backup or as an alternative to being able to get reliable power for household devices. Azuri has embarked on different partnerships; how have these been able to boost financial inclusion in Nigeria? In order to roll out this sort of technology, it is key to have partnerships. We have partnerships with many organizations within Nigeria. Early on this year, we announced a partnership with First Bank and one
of the key challenges we have with pay-as-you-go is the ability of customers to be able to pay on a regular basis. So, we have partnerships with First Bank, First Monie, mobile platforms which enable our customers to be able to pay very easily for the system that they have got. Other customers are using other techniques while people are paying directly to bank accounts. How will the partnership with Marubeni assist your quest? So Marubeni is a Japanese corporation a future 500 corporation in the world. It has huge experience of rolling out big generation power but Azuri and Marubeni have a shared vision the future of energy doesn’t look like it’s past and so our partnership with Marubeni enables us to scale out our solar power more quickly than will otherwise do without that partnership. So we are committed with working with Marubeni to support the rapid roll-out of solar particularly in Nigeria and bring the technology to the thousands of households What advantages will Nigeria get from Azuri solar system? So first, it is reliable power, every night you are going to have light; every night you are going to be watching your TV. Reliability is number one. Number two is that you are able to get rid of a generating set for a large part of the day. You get rid of the noise, fumes and the cost of having a running. The third one is that with Azuri, you are able to get free energy. With Azuri, the solar home system you pay for two and a half years, once you pay for that system you no longer have to pay for it anymore. So we estimate that already ten million consumers in sub-Saharan Africa have free energy from pay-as-you-go solar home system and in the first half of this year, a million new systems were sold. So that’s enough system to supply another five million consumers. The rate of roll-out of the system is growing very fast. And it is really very exciting because everywhere else in the world, people pay for their energy and potentially the Nigeria consumer could be one of the first consumers who are able to get free energy and be able to use that energy for a whole lot of things.
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Monday 23 December 2019
BUSINESS DAY
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Monday 23 December 2019
BUSINESS DAY
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Live @ The STOCK Exchanges Prices for Securities Traded as of Friday 20 December 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. 341,234.17 -2.04 109 6,581,835 UNITED BANK FOR AFRICA PLC 235,976.01 -1.43 131 10,372,956 ZENITH BANK PLC 574,555.84 -1.08 401 23,845,916 641 40,800,707 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 233,319.40 0.78 136 6,028,498 136 6,028,498 777 46,829,205 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,289,882.72 - 116 653,892 116 653,892 116 653,892 BUILDING MATERIALS DANGOTE CEMENT PLC 2,385,671.04 - 34 384,258 LAFARGE AFRICA PLC. 221,482.19 -1.08 97 3,764,402 131 4,148,660 131 4,148,660 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 323,467.98 - 7 18,315 7 18,315 7 18,315 1,031 51,650,072 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 - 0 0 UPDC REAL ESTATE INVESTMENT TRUST 9,072.12 3.03 6 203,000 6 203,000 6 203,000 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 - 0 0 0 0 0 0 6 203,000 CROP PRODUCTION FTN COCOA PROCESSORS PLC OKOMU OIL PALM PLC. 52,465.05 - 15 23,009 PRESCO PLC 47,500.00 - 6 1,492 21 24,501 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,500.00 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,500.00 - 1 10,000 1 10,000 22 34,501 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 1,323.65 - 13 382,480 JOHN HOLT PLC. 217.92 - 0 0 S C O A NIG. PLC. 1,903.99 - 0 0 TRANSNATIONAL CORPORATION OF NIGERIA PLC 39,835.03 1.02 42 10,244,870 23,914.76 -3.49 86 3,010,497 U A C N PLC. 141 13,637,847 141 13,637,847 BUILDING CONSTRUCTION ARBICO PLC. 521.24 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 25,740.00 2.63 32 519,340 ROADS NIG PLC. 165.00 - 0 0 32 519,340 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,182.65 - 4 105,000 4 105,000 36 624,340 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 7,281.43 - 2 25,720 GOLDEN GUINEA BREW. PLC. 242.22 - 0 0 GUINNESS NIG PLC 70,201.77 -9.97 34 1,229,671 INTERNATIONAL BREWERIES PLC. 80,801.10 - 3 3,590 NIGERIAN BREW. PLC. 463,420.47 9.96 76 720,252 115 1,979,233 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 178,800.00 -9.97 65 1,417,062 FLOUR MILLS NIG. PLC. 79,957.40 1.04 26 679,227 HONEYWELL FLOUR MILL PLC 7,930.20 - 7 122,171 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 - 3 4,815 NASCON ALLIED INDUSTRIES PLC 31,660.79 -9.81 23 1,203,560 UNION DICON SALT PLC. 3,321.07 - 0 0 124 3,426,835 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 18,030.74 -9.86 33 384,907 NESTLE NIGERIA PLC. 1,030,453.13 - 88 253,880 121 638,787 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 - 0 0 VITAFOAM NIG PLC. 4,878.29 - 36 1,033,952 36 1,033,952 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 21,440.58 -10.00 45 2,256,788 UNILEVER NIGERIA PLC. 116,049.11 9.49 48 529,263 93 2,786,051 489 9,864,858 BANKING ECOBANK TRANSNATIONAL INCORPORATED 121,107.04 -5.04 86 5,298,945 FIDELITY BANK PLC 62,295.81 -2.27 91 14,546,618 GUARANTY TRUST BANK PLC. 871,162.91 -1.33 157 22,987,566 JAIZ BANK PLC 19,446.40 1.54 10 710,000 STERLING BANK PLC. 54,701.79 -2.56 25 2,824,221 UNION BANK NIG.PLC. 198,021.12 - 20 32,479 UNITY BANK PLC 8,416.32 7.46 9 580,701 WEMA BANK PLC. 27,002.13 -6.67 37 1,775,189 435 48,755,719 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 - 0 0 AIICO INSURANCE PLC. 4,920.45 - 18 1,443,174 AXAMANSARD INSURANCE PLC 18,900.00 - 0 0 CONSOLIDATED HALLMARK INSURANCE PLC 3,170.70 - 1 20,000 CONTINENTAL REINSURANCE PLC 22,820.04 - 0 0 CORNERSTONE INSURANCE PLC 6,186.39 -8.70 15 1,319,499 GOLDLINK INSURANCE PLC 909.99 - 0 0 GUINEA INSURANCE PLC. 1,228.00 - 1 100 INTERNATIONAL ENERGY INSURANCE PLC 487.95 - 0 0 LASACO ASSURANCE PLC. 1,977.33 - 4 336,083 LAW UNION AND ROCK INS. PLC. 2,362.98 - 2 122,448 LINKAGE ASSURANCE PLC 3,920.00 - 4 86,000 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 - 0 0 10,561.01 - 9 159,699 NEM INSURANCE PLC NIGER INSURANCE PLC 1,547.90 - 0 0 PRESTIGE ASSURANCE PLC 2,745.10 - 0 0 REGENCY ASSURANCE PLC 1,333.75 - 0 0 SOVEREIGN TRUST INSURANCE PLC 1,668.16 - 4 573,096 STACO INSURANCE PLC 4,483.72 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 - 2 2,000 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 - 1 500 VERITAS KAPITAL ASSURANCE PLC 2,773.33 - 1 100 WAPIC INSURANCE PLC 4,817.79 - 29 659,795 91 4,722,494 MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,629.63 - 2 31,250 2 31,250
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MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,200.00 - 0 0 7,370.87 - 0 0 ASO SAVINGS AND LOANS PLC INFINITY TRUST MORTGAGE BANK PLC 5,796.93 - 0 0 RESORT SAVINGS & LOANS PLC 2,265.95 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 - 0 0 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 8,240.00 - 21 141,700 CUSTODIAN INVESTMENT PLC 33,232.53 -8.87 15 363,853 DEAP CAPITAL MANAGEMENT & TRUST PLC 600.00 - 2 165 FCMB GROUP PLC. 37,625.15 5.56 130 29,637,836 1,492.16 - 6 45,540 ROYAL EXCHANGE PLC. STANBIC IBTC HOLDINGS PLC 393,936.28 0.81 16 180,511 UNITED CAPITAL PLC 14,280.00 0.42 30 599,564 220 30,969,169 748 84,478,632 HEALTHCARE PROVIDERS EKOCORP PLC. 2,069.19 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 710.63 -9.09 9 166,107,500 9 166,107,500 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 494.58 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 - 0 0 FIDSON HEALTHCARE PLC 6,467.72 - 5 45,280 6,278.35 -8.70 39 1,061,306 GLAXO SMITHKLINE CONSUMER NIG. PLC. MAY & BAKER NIGERIA PLC. 3,692.00 - 10 126,252 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 1,082.52 - 3 92,500 NIGERIA-GERMAN CHEMICALS PLC. 556.71 - 0 0 PHARMA-DEKO PLC. 325.23 - 0 0 57 1,325,338 66 167,432,838 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 852.48 - 0 0 0 0 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 - 0 0 NCR (NIGERIA) PLC. 486.00 - 0 0 TRIPPLE GEE AND COMPANY PLC. 316.77 - 0 0 0 0 PROCESSING SYSTEMS CHAMS PLC 1,690.58 - 8 1,142,900 E-TRANZACT INTERNATIONAL PLC 10,962.00 - 0 0 8 1,142,900 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,123,311.48 - 3 51,072 3 51,072 11 1,193,972 BUILDING MATERIALS BERGER PAINTS PLC 1,956.31 - 8 15,754 CAP PLC 16,800.00 - 26 519,995 CEMENT CO. OF NORTH.NIG. PLC 245,126.29 -0.80 82 4,862,326 MEYER PLC. 286.87 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 - 0 0 PREMIER PAINTS PLC. 1,156.20 - 0 0 116 5,398,075 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 - 0 0 CUTIX PLC. 2,553.92 3.57 10 306,578 10 306,578 PACKAGING/CONTAINERS BETA GLASS PLC. 26,898.49 - 16 100,443 GREIF NIGERIA PLC 388.02 - 0 0 16 100,443 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 - 0 0 0 0 142 5,805,096 CHEMICALS B.O.C. GASES PLC. 2,289.35 -9.84 2 312,000 2 312,000 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 83.60 - 0 0 0 0 2 312,000 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 - 8 121,972 8 121,972 INTEGRATED OIL AND GAS SERVICES OANDO PLC 42,266.80 -9.57 66 2,509,745 66 2,509,745 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 53,332.04 - 4 2,704 CONOIL PLC 12,838.11 - 36 162,676 ETERNA PLC. 3,912.43 - 7 113,305 FORTE OIL PLC. 23,574.91 - 34 418,649 MRS OIL NIGERIA PLC. 4,663.23 - 4 1,496 TOTAL NIGERIA PLC. 37,652.97 - 12 8,055 97 706,885 171 3,338,602 ADVERTISING AFROMEDIA PLC 1,509.28 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 15,796.05 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 247.03 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,623.26 - 5 23,204 TRANS-NATIONWIDE EXPRESS PLC. 464.16 - 0 0 5 23,204 HOSPITALITY TANTALIZERS PLC 642.33 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,259.15 - 1 5,000 IKEJA HOTEL PLC 2,328.25 - 0 0 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 - 0 0 TRANSCORP HOTELS PLC 41,042.18 - 2 20,025 3 25,025 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,320.00 - 5 5,100 5 5,100 PRINTING/PUBLISHING ACADEMY PRESS PLC. 223.78 - 1 7,000 LEARN AFRICA PLC 964.31 - 0 0 STUDIO PRESS (NIG) PLC. 1,183.82 - 0 0 UNIVERSITY PRESS PLC. 504.75 - 2 28,000 3 35,000 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 745.97 - 0 0 0 0 SPECIALTY INTERLINKED TECHNOLOGIES PLC 757.44 - 0 0
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Monday 23 December 2019
BUSINESS DAY
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Monday 23 December 2019
BUSINESS DAY
39
news
Reps pass N278.355bn FCT statutory budget ... okays N238.149bn budget for Customs James Kwen, Abuja
H
ouse of Representatives on Friday passed into law the N278.35 billion Federal Capital Territory (FCT) Statutory budget and 2020 Appropriation Bill. The budget recorded N45.480 billion increase as the House jerked the N232.875 billion proposal sent by President Muhammadu Buhari to the current N278.355 billion. The House passed the budget after consideration of the report of the Committees on Federal Capital Territory and Federal Capital Territory Area Councils and Ancillary Matters on a Bill for an act to Authorise the issue from the Federal Capital Territory Administration Statutory Revenue fund of the Federal Capital Territory Administration Account, the total sum of N278,355,365,947.00 only for the Service of the Federal Capital Territory, Abuja for the year ending on December 31, 2020 by the Committee of Supply. Out of the total budget, the sum of N55,878,241,095.00 only, is appropriated for Personnel Costs; and the sum of N62,343,723,435.00 only, is for Overhead Costs while the balance of N160,133,401,417.00 only, is for Capital Projects. According to the report, the Director of Treasury, FCT Administration shall,
when authorised to do so by warrants signed by the Minister of FCT with the responsibility to pay statutory revenue fund of FCTA during the financial year 2020 the sum specified by the warrants, not exceeding in the aggregate N278 billion. The report said all the amounts appropriated under this Bill shall be made from the FCTA statutory revenue fund only for the purposes specified in the schedule to this Bill. It stated that in the event that the implementation of any of the projects intended to be undertaken under this Bill cannot be completed without virement, adding that such virement shall be effected with the prior approval of the National Assembly. The report stipulated that the FCT Minister and the Director of Treasury, FCTA shall immediately upon the coming into force of this Bill furnish the National Assembly, on a quarterly basis, the status of the records of the FCT statutory accounts. It said due to revenue shortfall, amounts appropriated under this Bill cannot be funded, unless the FCT minister of seek from the National Assembly a waiver not to incur such expenditure. Also at the sitting, the House approved N238.149 billion budget for the Nigerian Customs Service for the 2020 financial year.
FCCPC to focus on robust enforcement, wider consumer education in 2020 HARRISON EDEH, Abuja
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he Federal Competition and Consumer Protection Commission (FCCPC) will widen its scope on robust enforcement and wider consumer education come 2020, Babatunde Irukera, director-general of the commission, said weekend. Babatunde gave the information while speaking with newsmen in Abuja, as he enjoined media representatives to join in advocacy on enlightening consumers on their rights. “The commission has just about 240 staff nationwide servicing prompt response of about 200 million Nigerians in the country. We are using the instrument of social media to deliver prompt responses to Nigerians and other means,” he said. Speaking further, he noted that the approach would focus on holding companies accountable with specific focus on how they respond to consumer complaints. “We would be focusing on mechanisms that put them on their toes to create consumer satisfaction while prioritising consumer rights. Timely resolution of complaints is our target,” he said. He explained further that the customer commercial
contract was with the company and not the Federal Government, and assured that the government would keep consolidating on the gains of its regulatory role to drive regulatory satisfaction. The director-general went further to say that the commission was in transition, as he noted that since the enactment of the Federal Competition and Consumer Protection Commission Act, issues bothering on arbitrary increase of price, procedures of merger and acquisition and competitive fair pricing were being adequate addressed. “There are certain sharp practices that you cannot do now because you know the regulator is on alert. We have been strengthened with the new act and it is advancing our work,” he said. He stated further that the new Act had given them power to have tribunal and are working out model to set up judges and panel for establishment, saying since the regulatory intervention by the commission, complaints on Multichoice Nigeria Limited had drastically reduced. “If we have been having 500 complaints previously it had drastically reduced to about two or three per week,” he said. www.businessday.ng
L-R: Ebenezer Oyesusi, business relation officer, PayAttitude; Onajite Regha, group head, PayAttitute; Yemi Osinaike, team leader, My Reality Initiative, Lagos University Teaching Hospital (LUTH); Minka Ndifon, deputy team leader, My Reality Initiative, LUTH; Abimbola Ogundare, business relation officer, PayAttitude, and Oluwagbenga Omodara, business relation officer, PayAttitude, at the presentation of gift to children at LUTH in Lagos. Pic by Olawale Amoo
Kwara presents N162bn budget estimate to State Assembly SIKIRAT SHEHU, Ilorin
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wara State Governor Abdulrahman Abdulrazaq has presented the 2020 budget estimates to the Kwara State House of Assembly with provisions for critical infrastructure and human capital development taking the larger chunk. The N162 billion fiscal plan comprises 53% capital expenditure covering road construction and rehabilitation, rehabilitation and re-equipment of schools and hospitals, rehabilitation of court rooms, and completion of a 500-seater hall building at the House of Assembly. “Basically, we are presenting a budget estimate of N162billion for 2020, up from N157bn budget of the outgoing year. For this year, we propose 47% recurrent
... enterprise, infrastructure top agenda expenditure and 53% capital expenditure in a deliberate attempt to invest in the future and grow the economy through critical infrastructure and human capital development. One unique thing is that this budget is having an opening balance of N7bn, or 4.3% of the budget proposal, that we have saved in the past seven months,” the Governor said in a speech before the Assembly. “Key highlights of the budget include construction of Kwara State innovation hub for information technology, large scale garment production factories, resuscitation of moribund industries, construction of new (urban and rural) roads, rehabilitation of public schools, capacity building for teachers for efficient service delivery, payment
of UBEC contribution, rehabilitation of hospitals and health centres with provision of modern medical and laboratory equipment, payment of counterpart funds, and implementation of health insurance. “We are also proposing construction of Ilorin Civic Centre (Ilorin Visual Art Centre), purchase of biometric finger prints and reader machines for e-auditing, commencement of e-Government, introduction of creative intervention fund for youth and graduates empowerment, provision of state-wide irrigation scheme, agricultural mechanisation, commencement of the livestock transformation plan programme, and implementation of the Kwara State Social Invest-
ment Programme.” He also proposed the purchase of vehicle for political office holders and members of the House, rehabilitation of Squash Court rooms and other sporting facilities at Stadium Complex Ilorin, construction of a twin Squash Court, interventions in the state-owned media, and active promotion of culture and tourism. The governor says there is a plan to widen the state’s tax base without imposing new tax on the people but through blocking of leakages. Abdulrazaq, however, commended members of the Assembly and the Kwara public for their support since he assumed office, calling for more support and sacrifice in the new year in the strategic interest of the state.
FG could have saved $6.5bn within 4 years on de-regulated oil sector HARRISON EDEH, Abuja
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ederal Government of Nigeria could have saved up to $6.5 billion (about N2.34trn) within four years if the petroleum downstream sub-sector has been de-regulated in the past four years. This is because the de-regulated sub-sector would have set up a competitive sector devoid of opacity. This $6.5 billion is 21.95% of the total sum Nigeria is seeking to borrow from the Chinese government, which many analysts have expressed concern on Nigeria’s rising debt profile when an economically viable oil sector could have addressed this and lessen Nigeria’s rising debt. Nigeria has failed to deregulate the oil sector, which has inadvertently worsened its susceptibility to volatile budgeting system that relies heavily on oil for its budget funding, while putting the economy on an economic edge that sees to trillions of naira being used to service debt annually. The International Monetary
Fund has severally cautioned the Nigerian government on the importance of subsidy removal to help the country advance its economic development agenda, but the government on its own says the removal has to come in phases in order not to hurt the vulnerable in the society. The Nigerian National Petroleum Corporation (NNPC) has been adopting a merchant plant refineries business model since 2017, on the back of consecutive losses posted by the Nigerian owned refineries comprising Port Harcourt, Kaduna and Warri. The implication, industry analysts say, is the increasing expansion of the opaqueness that has characterised the sector overtime and apparent huge loss in revenue since NNPC is the sole importer of petroleum product currently. “What we did practically is to import more than we need of petroleum product and that has taken us to from 36 million daily litres of premium motor spirit to about 55 million litres per day, and that is almost importing for West Africa, and
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that is why we have seen rise in the NNPC under recovery payment rising astronomically,” Henry Ademola Adigun, an oil sector governance expert, told BusinessDay. He stated further that this development had seen to about N35 per litre subsidy payment on each of the 55 million daily litres of fuel imported into the country, which had seen to the surge in the ‘under recovery’ to trillions of naira outpacing what it used to be in the past. According to Adigun, the larger implication of this development is that it increased opacity, drain the natural resources while lowering accountability and most probably we may have been subsidising for our West African neighbours. Speaking further, he noted, “Border closure and cutting off fuel supply to communities with high proximity to the border is not the solution but complete deregulation of the downstream sector.” Under Buhari’s new configuration, the NNPC imports bulk of the petrol then ab@Businessdayng
sorbs the subsidy into bits operational costs as ‘under recovery.’ Industry analysts say this is problematic since there is opacity and lack of proper checks and balances. “The so-called under recovery lacks proper checks and balances and had spiked to trillions as against what we have in the past, which has given room to all manner of fraudulent practices in the so-called under recovery,” Eze Onyekpere, lead partner, Centre for Social Justice. Former Nigerian vice president, Atiku Abubakar, had in a recent representation noted, “In my economic blueprint, I said that rather than turn regular losses, the best thing to do with the Nigerian National Petroleum Corporation is to reform it. “But just last week, Saudi ARAMCO, the most profitable company in the world took this route, and almost broke the global stock market with the most successful initial IPOs in world history. Ironically, Saudi Aramco raised $29.4 billion via this IPO. Just the amount this administration wants to borrow.”
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Monday 23 December 2019
BUSINESS DAY
news Chevron’s $10bn write-down means greater troubles for oil industry ... Repsol, Schlumberger also write down assets DIPO OLADEHINDE
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he global oil and gas industry may be in for greater troubles as Chevron, one of the world’s largest and best-performing oil companies, plans to writedownthevalueofitsassets. And Nigeria won’t be spared. Chevron announced on December 13 that it is writing down the value of its assets by more than $10 billion, a concession thatinanageofabundantoiland gas some of its holdings won’t be profitable anytime soon. The impairment is a sign that the waters are getting pretty rough for the oil and gas industry due to a combination of supply surpluses, low prices, the struggling and unproven business case for large-scale shale drilling, and the looming threat of peak demand. “Chevron’s write-down is a signal of much greater troubles to come in the oil and gas industry, most especially for countries that still run oil-dependent economy,” Charles Akinbobola, an energy analyst at Sofidam Capital, said.
Nigeria, Africa’s largest oil producer, is dependent on the oil sector for 90 percent of its foreign exchange earnings. The country has Africa’s second-largest oil reserves with estimated known reserves of 37 billion barrels of oil and 202 Tcf of proven gas reserves. Chevron said the expected write-downs this quarter are relatedtoadeepwaterGulfofMexicoproject,whichneedshigheroil pricestochurnaprofit,andshale gasinAppalachia,whichhassufferedfromlownaturalgasprices. Itisconsideringsellingitsstakein a cultural region in the Eastern United States Appalachia shale and the proposed Kitmat LNG project in Canada. “Oil companies have struggled to reap the profits of old and are falling out of favor with investors amid fears that electric vehicles and renewable energy, along with government regulations to address a warming planet, will constrain their futures,” Jasper Teulings, an energy analyst at General Counsel & Advocate, tweeted Dec. 13.
•Continues online at www.businessday.ng
Here’s what Fitch, Moody’s negative outlook means for Nigeria MICHAEL ANI
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arely two weeks after New-York based rating agency, Moody’s, downgraded its outlook for the Nigerian economy, Fitch Rating on Thursday did the same, with both forecasting a gloomy outlook for 2020. The US-based rating agency revised its outlook for the Nigerian economy to negative and affirmed the rating at B+. The downward revision, Fitch said, was as a result of Nigeria’s increasing vulnerability from its current macro policy setting, raising the risk of disruptive macroeconomic adjustment in the medium term amid continued real appreciation of the naira. Early this month, Moody’s hammered Nigeria with a negative rating, in what it said was due to increased fragility of the country’s public finances and sluggish growth prospects. Moody’s also downgraded the outlook for Nigerian banks as well as their counterparts in other African countries. This sent stocks of listed firms to lower lows as investors reacted to the downward rating. Like Moody’s, the downward rating by Fitch has serious implications on the health of Africa’s largest economy, especially at a time when the economy requires enough investment oxygen to breathe, analysts who spoke to BusinessDay said. High borrowing cost Being downgraded can have a big impact on a country’s ability to borrow money
from the markets, as investors see it as a riskier bet and demand higher returns to lend to governments, according to Gbolahan Ologunro, an equity researcher at CSL Stockbrokers. “But for falling yields in advanced countries, Nigeria would have had to pay at a higher interest than it did on offshore borrowings,” he said. Nigeria plans on borrowing about $22.7 billion from various sources to fund 39 projects across various sectors from transportation to education. Already, in the 2020 budget, Nigeria plans to spend almost a third of its projected revenue to service its debt that has almost tripled to N25 trillion in the last four years. With a revenue projection of N8.42 trillion in the 2020 fiscal year, debt servicing is expected to gulp N2.452 trillion or 29 percent, according to a statement by Zainab Ahmed, minister of finance, budget and national planning. That’s high when compared to the 14.5 percent used in servicing debt in 2019. With dwindling revenue in the wake of falling oil prices, it would become difficult for the government to meet its financial obligation. According to Fitch, Nigeria’s debt remains on an upward path, while particularly low fiscal revenues and structural shortcomings in public finance management constrain the sovereign’s ability to support a rising debt burden.
•Continues online at www.businessday.ng www.businessday.ng
L-R: K. L. M. Rao, group finance director, Enpee Group; Seyi Oyefeso, group executive, commercial banking group, FirstBank; Sanjay Naraindas Kirpalani, chairman, Enpee Group; Olusegun Alebiosu, chief risk officer, FirstBank; Gbenga Shobo, deputy managing director, FirstBank, and Olufunmilayo Nwanguma, group head, commercial banking group, Lagos Island, FirstBank, during a courtesy visit by the management of Enpee Group to FirstBank at the bank’s head office in Lagos.
CBN slashes bank charges in revised guidelines
... moves to protect customers from unfair treatment
HOPE MOSES-ASHIKE, Lagos, & ONYINYE NWACHUKWU, Abuja
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n furtherance of its quest to make financial services more accessible and affordable to various stakeholders in the economy, the Central Bank of Nigeria (CBN) has reviewed downward most charges and fees for banking services. With effect from January 1, 2020, charges on electronic funds transfer, for instance, will attract N10 for transactions below N5,000; N25 for those between N5,001 and N50,000, and just N50 for those above N50,000. The new Guide to Charges by Banks, Other Financial and Non-bank Financial Institutions was contained in a circular issued by the apex bank on Sunday. The new guide includes, amongst others, a downward review of charges for electronic bankingtransactions,removalof Card Maintenance Fee (CAMF) on all cards linked to current ac-
counts,reductionintheamount payable for cash withdrawals from other banks’ Automated Teller Machines (Remote-onus),reviewofotherbankcharges to align with market developments, and inclusion of new sections on accountability/ responsibility and a sanction regime to directly address instances of excess, unapproved and/or arbitrary charges. The new Guide, which replaces the Guide to Charges by Banks and Other Financial Institutions issued in 2017, takes effect from January 1, 2020, and may be reviewed from time to time to reflect changes in the business environment. The CBN slashed charges on ATM withdrawals (from other banks other than the issuing bank) in Nigeria from N65 to N35 after the third withdrawal within the same month. International withdrawal per transaction – whether debit/credit card – attracts just the exact cost by the international acquirer. Other reductions include
Advance Payment Guarantee (APG) which is now pegged at maximum of 1 percent of the APG value in the first year and 0.5 percent for subsequent years on contingent liabilities. On debit card charges, the new Guide stipulates that a one-off charge of N1,000 applies to the issuance of cards, irrespective of card type (regular or premium). The same one-off charge of N1,000 applies for the replacement of debit cards at the customer’s instance for lost or damaged cards. In the same vein, upon expiry of existing cards, customers are to pay the same one-off charge of N1,000 irrespective of card type. Conversely, no charge shall be required for pre-paid card loading/unloading. According to the circular, the current NIP charges apply to use of Unstructured Supplementary Service Data (USSD), purchase with cash-back will attract a charge of N100 per N20,000 subject to cumulative N60,000 daily withdrawal. Also,
for cards linked to savings account, a maintenance fee has been reduced to a maximum of N50 per quarter from N50 per month amounting to only N200 per annum instead of N600. Furthermore, the CBN said there will be no more charges for reactivation or closure of accounts such as savings, current and domiciliary accounts while status enquiry at the request of the customer (like confirmation letter, letter of non-indebtedness and reference letter) will now attract a fee of N500 per request. On Current Account Maintenance Fee (CAMF), the guide expressly stated that this would be applicable only to current accounts in respect of customer-induced debit transactions to third parties and debit transfers/lodgments to the customer’s account in another bank. It emphasised that CAMF is not applicable to savings accounts.
•Continues online at www.businessday.ng
Residents kick, businesses bleed as Apapa gridlock gets messier …It’s corruption fighting back, says presidential task team CHUKA UROKO
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s residents of Apapa, Nigeria’s port city, scream blue murder over the hell that Apapa has become in the last one month on account of congestion and gridlock, businesses are also bleeding with rising costs and low productivity for the same reason. After the spirited activities of the Presidential Task Team (PTT) which turned out to be a flash in the pan, Apapa has become increasingly messier because the traffic situation has worsened and movement
in and out of the port city has become harder and more expensive. “The traffic situation we have now is the worst ever. In the past, we used to wriggle through with one lane intermittently open. Now, as from 6pm, from Ijora to the port turns into parking lot with little or no movement. Cars have been trapped for four to six hours, some till daybreak,” Ayo Vaughn, chairman, Apapa GRA Residents Association, told BusinessDay. Though the presidential task team alleges that the present situation in Apapa is
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a case of “corruption fighting back”, Vaughn was of the view that the team was incapable of creating or maintaining space for free flow of residents’ vehicles into Apapa. Observers say it is crystal clear that the team has lost control of traffic in Apapa despite protestation by Kayode Opeifa, its executive vice chairman, that the team was still in charge and working in spite of all odds. Coming in and going out of Apapa has become not only expensive but also risky. The quickest and easiest means of entering and exiting the port @Businessdayng
city is by commercial motorcycle, popularly called okada. This costs the commuter over N2,000 and exposes him/her to the highest of risks as the ‘okada man’ runs in-between moving and stationary trailers and tankers. Arguably, Apapa has become an ‘okada’ economy as the only thriving industry in the city is this otherwise loathsome means of transportation unbefitting of a fast-moving city like Lagos, which prides itself as a smart city.
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news The Lagos hospital wards of deadly... Continued from page 1
ing into the reception hall
was a white iron gate manned by two security personnel. All distressed eyes were fixed on that gate in the utmost anticipation of being called in. Randomly, a triage team of young doctors and nurses in green uniforms would stroll out of it within an average of 30 minutes to an hour to file in new cases and return. Triage is typically the rudimentary phase of assessment that patients face. It includes key checks of vital signs and the identification of a chief complaint, chest pain, difficulty in breathing, or abdominal pain, for instance. Although the process is about assigning degrees of urgency to wounds or illnesses to decide the order of treatment of a large number of patients or casualties, patients with evidently serious conditions, such as cardiac arrest, will bypass triage altogether and move straight to the appropriate part of the department. Moreover, the choice of the hospital was not arbitrary in the first place. Attendance was based on a referral, from private to general and stateowned. So, after 30 minutes of waiting, I knew that triage attention was sure-fire. If the observing physician failed to notice one was dying, a friend or relative could scream or yell for attention. At least your case would make the list of pending issues. But nothing was guaranteed. Why? “No bed space,” the doctors repeated, warning patients that opting to wait until an anonymous date or time when a bed space would be available is completely their decision. As a patient, you bore the full weight of the consequences “before you start saying these doctors and nurses are wicked or institute litigations against us, we told you beforehand: there is no space”. Hence, there was no bed space for patients who were meandered through the horrid traffic of Lagos, on roads that rattled their soul and from hospitals that had made
it clear to them that survival was in LUTH. But in another tone of pity, as if the hunch of humanity stung them, the doctors sometimes kindly said: “If you can wait until space opens, we will take you in.” Hearing this, patients’ relatives or guardians would switch into serious conversations with Jesus Christ, Allah or whatever thing their belief was reposed. The crux of all prayers was for a bed space to open. In sight that hot afternoon were about 10 patients, scattered around the gate withholding their healing. While some were on the bench, others lay critically ill in commercial tricycles, taxis and personal cars. Some were fed up, so they left, but not without hurling insults and curses at the doctors, the hospital management and the government that usually fails the people. They had heard grim accounts that they thought would brace them up for the worst. Yet, they couldn’t seem to handle the disappointment when they learned the singular reason they might watch their loved one die in anguish was lack of bed space. But they dare not! Those without alternative support dare not leave that gate. Of what use was a rage that won’t transport a sick one straight into the emergency ward? So, they suspend their patients’ destiny on the possibility that an in-patient could be up for transfer to the appropriate wards for further care. Should that fail to happen, the prayer is that an in-patient is discharged. Without praying at all, the ugliest happens. Some in-patients die for some of the waiting patients to make it in. In Africa, about 56 percent of deaths occurred due to Emergency Department (ED) overcrowding, an instance where the demand for emergency services exceeds the ability of a department to provide quality care within acceptable timeframes. In Nigeria, almost 60 percent of increased mortality occurred in children and elderly emergencies, according to
Ogbonnaya’s blood pressure being assessed by Dr Akinseye at the A&E reception
research on Overcrowding in Emergency Departments of Referral Centres. In Lagos, it was discovered that patients admitted to the hospital during high ED overcrowding times had 5 percent greater risk of in-patient death than similar patients admitted to the same hospital when there was less overcrowding. In danger of triage delay Akeem Sanni, 40, happened to be on that triage list on the November 12. His wife and friends ferried him to the A&E around 3:40 pm, based on a referral by the National Orthopaedic Hospital, Igbobi, Lagos, Sheriff, one of his friends, told me as I raised a conversation on the bitter wait with him. Typically, one of the triage doctors came out after an hour of Sanni’s arrival, noted
A sample of Ogbonnaya’s chest fluid being taken by Dr Okeke in the company of student doctors www.businessday.ng
his case and served the sad news: “There is no bed space.” “We met about five patients here. Some left in annoyance and desperation for treatment. The doctor came and told us there was no bed. He referred us to the spillover section. We went to the spillover but we were also told the same thing,” Sheriff groused bitterly. “And we don’t have another option. Before the doctor even came out to ascertain what was wrong with my friend, we had spent over an hour here.” The day before he landed at LUTH, Sanni was crushed by a speeding commercial motorcyclist who rode against the one-way lane between Ijesha and Sanya bus-stops, on the Apapa-Oshodi Expressway leading to Mile 2. The 32-kilometre road went under reconstruction over two months earlier, following the activation of President Muhammadu Buhari’s Executive Order 007. In the
Federal Government’s bid to decongest Nigeria’s busiest port in Apapa, the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme was signed to permit companies interested in funding road construction to do so and recover expended funds through reduced tax. Since construction work kicked off, traffic laws were automatically suspended on the road, with drivers moving precariously against traffic to escape delays. It was on this same road that the father of one, an indigene of Ogun State, sourced his livelihood from electrically welding pieces of iron into useful shapes. But as he returned from withdrawing some cash at an automated teller machine centre, he encountered the fatal collision that enrolled him on the emergency list. It was dusk and he was unable to spot an adjacent movement when he
crossed and found his body in a fist with the motorcycle on the asphalt-laid road. The collision left his leg ruptured at knee point and the left side of his eyes with a bashing that sent torrents of sharp pains to his brains. These were visible injuries that didn’t fully account for what had happened internally. In the rear of the black SUV where he waited, Sanni’s body was swollen all over. He could neither sit nor stand upright. At a point, his breathing began to require more effort than necessary. Impressively, Sanni was that kind of patient who had about seven concerned ones rooting relentlessly for him to get attention. Each time a triage doctor came out, they sped in his direction and circled him. But at 5:59 pm that day, the awaited news did not arrive. This was more than three hours after he first showed up at LUTH. In a letter dated November 10, 2019, Chosen Hospital and Maternity Home, the hospital that initially assessed Sanni, kindly asked the National Orthopaedic Hospital, Igbobi, to receive him and give him expert management. “The above-named patient was brought into our facility last night (16 hours ago), on account of multiple injuries 2o RTA, nil history of LOC. Examination revealed deep laceration, supraorbital, multiple facial bruises and thigh deformity plus swelling. Investigations done are thigh x-ray, chest x-ray (CXR) and computerised tomography (CT) Scan,” Dr Abruche said in the referral letter. Abruche based his conclusions on the report of Paramount Lifecare, a diagnostic centre in Festac Town, where Sanni was diagnosed. A CT scan typically reveals anatomic details of internal organs that cannot be seen in conventional x-rays, according to MedicineNet. When Paramount Lifecare ran a CT scan on Sanni’s brain, it found multiple areas of mixed density seen predominantly in the right parieto-occipital region, with effacement of sulci in keeping with contusion bleed. A biconvex hyperdense area was seen adjacent the left temporoparietal bone in keeping epidural haematoma. There was associated hydrocephalus. Opacification
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A patient being administered with intravenous fluid in a commercial tricycle at LASUTH
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of the sphenoid sinus both ethmoid sinuses and thickening of the left maxillary sinuses were seen. The impression: left epidural haematoma with right cerebral haemorrhagic contusions and temporoparietal bone fracture with opacification of paranasal sinuses. In plain terms, this meant the accident caused internal bleeding in the brain and the bleeding had formed a mass. Epidural hematoma is a traumatic accumulation of blood between the inner table of the skull and the stripped-off dural membrane. In 85 to 95 percent of patients, this type of trauma results in an overlying fracture of the skull. Due to this, the orthopaedic hospital didn’t take him, arguing that LUTH would be in a better position to deal with the problem, Abdulhakeem Shittu, one of Sanni’s friends, explained. Now , Sa n n i’s o t h e r friend who owns the SUV that brought him wanted to leave but he couldn’t because LUTH did not take over the care until about five hours after his arrival at the emergency gate when a bed space finally opened. I pushed for an opportunity to stand in as one of Sanni’s relative but it wasn’t successful. Sanni’s wife was particularly soaked in so much apprehension that she had no room left in her mind to nurse the idea of a reporter following her husband’s case when it didn’t help with the medical bills or avail him special attention. The hospital rule also did not help, as a patient only had the allowance of an individual to monitor. Waterlogged chest Failing to win the Sannis on my side, I returned to my initial spot behind the wooden bench. By then, more patients had joined a raft of squirming others. It was getting darker. The black SUV that brought Sanni had moved out of the car park. Two cars were now occupying the space with patients in them. In one was a slender woman of about 60 years old lying in the back seat. She battled with a diabetes case that had advanced into a footsore. With her were her husband, daughter and friend. She arrived at the emergency unit at around 7pm, just about the time I returned. But a more critical case of respiratory challenge had been queuing three hours earlier. Ebuka Ogbonnaya, 37, an indigene of Abia, arrived at about 4pm. Even without careful parsing, one could tell that he was so ill. Pale and lean, his skin cringed ungracefully towards his bones. Conversely, his stomach, legs and feet were swollen. His breathing was heavy. Lying on his back was a huge luxury he couldn’t afford. And without taking on
any strenuous task, he easily grew tired. He couldn’t even walk any reasonable distance. All he could do was sit and moan in discomfort. And while different doctors had noticed him, only one managed to grant him conditionspecific attention. “The doctor who initially attended to my husband only wrote his name and checked his blood pressure. Another doctor came complaining that the first should have asked us to go for an x-ray, because it’s the beginning of the treatment. He gave me prescriptions to the radiology centre,” Blessing, Ogbonnaya’s wife, explained in response to my inquiry, as our friendship started to gain ground. “The result was released around 12am on Wednesday. I ran back to the car park to show any available doctor. When he came out, he insisted that there was no space. And my husband has been complaining of serious body pains since I brought him. No one listened. They kept saying there is still no space, since afternoon!” she said. She could have reserved her annoyance if she knew how many hours more her husband would writhe while waiting in the queue. The dusk had finished falling. It was midnight and time to retire for the day. They moved towards the open area of the out-patient ward beside the A&E to secure a sleeping space as fellow frustrated patients did. According to LUTH’s radiological report, Ogbonnaya wrestled with near-complete opacification of the right hemothorax with obliteration of the carbothermic angle and the hemidiaphragm in keeping with pleural effusion with the upper margin at the left of 2nd artemia rib. “Right sided pleural effusion and left sided pleural effusion,” Dr Jayeola Adenuga stated as his conclusion on Ogbonnaya’s case. Prior to LUTH’s assessment, the Federal Medical Centre, Ebutte-Meta, had described Ogbonnaya as a biventricular failure patient who presented on account of generalised body weakness, difficulty in breathing and leg swelling. “He is currently being managed for biventricular
EMERGENCY SITUATION AT LUTH Patients seeking care at A&E daily
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failure secondary to dilated cardiomyopathy with congestive hepatopathy,” read the report. “Chest X-ray done today revealed massive pleural effusion. Please kindly review the patient for expert management.” When asked, Akeem Olowofela, a resident doctor at Federal Neuropsychiatric Hospital, Aro, Abeokuta, categorised the case as an extreme one that required urgent attention. It involves vital organs that are averse to disturbance, although temporal stability is possible. It is a chronic situation that should be treated promptly. Giving similar verdict, Babayemi Osinaike, head of emergency at LUTH, confirmed that Ogbonnaya should have had access to
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treatment in less than two hours after he was triaged. He categorised his case as Level 2, only next to an acute condition. “On the average, something should be done within four hours. For a pleural effusion, in fact, they should have responded to you as quickly as less than four hours,” Osinaike said. “Once a chest x-ray is done that shows that there is an effusion, a chest tube should be inserted first and foremost into the patient’s chest while the other root causes are being addressed. It shouldn’t take more than an hour to two.” A&E Ward: Intensive care, extensive problems Two options are available to access the A&E ward: using the main entrance or the back
Isaac, Uber driver, waiting for his passenger, a patient, who is also waiting for a bed space, to get off. www.businessday.ng
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Beds in Intensive Care Unit
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channel connecting to the rest of LUTH. Under an arrangement to access the ward as a nursing student, I took a trip via the back. Signs of renovation undertaken by Stanbic IBTC Bank in February 2018 were still fresh, especially at the reception. There was a colourful wall poster attempting to cheer every eye that met it. It had different characters on it, from smiling doctors to a playing kid, two aged elders, and a police officer by the road. “We are happy to know that everyone is getting on well”, “We hope to see you back in full fitness”, “Your recovery means a lot to us” and more were thoughts ascribed to each character. All the modern patient beds in the hallway were those donated by the bank. But moving further into the wards, evidence of old, rusting beds hung around. The shock: the accident and emergency ward has about 35 beds. Ten of them were available in the medical emergency unit, 10 in surgical emergency and four in the gynaecology unit. The Intensive Care Unit boasts of only four beds and all were occupied, except for a few bad ones. These are units responsible for tending to referral cases from various federal medical centres, general hospitals, private hospitals and more in Lagos, a state populated by over 20 million @Businessdayng
people! For context, about 60 to 65 patients seek care at the ward every day, according to Osinaike. Out of these 65 cases, investigation based on inpatient registration revealed that only 20 were pooled into the ward daily. The register accounts for only those that make it into the reception as new cases and are registered. What this means is that if a patient admitted earlier into the ward does not leave at the appropriate time for one reason or the other, the next person who requires that service will continue to writhe in pains at the car park. This happens often. With a National Health Insurance Scheme (NHIS) that caters to less than 5 percent of the country’s population, many patients are so overwhelmed by the cost of diagnosis, surgery, drugs and admission into wards that their relatives and friends spend considerable time raising money. Some patients spend two to three days scampering the town for help, directly blocking access to others waiting outside. In terms of the concentration of doctors for every shift, accident and emergency ward happens to be the ward with one of the highest. About 10 doctors were officially assigned: two in triage, three in obstetrics and gynaecology, three in medicine, two in surgery and four as house officers. But they are all never available. Spillover filled to the brim Ebuka Ogbonnaya and his 28-year-old wife, Blessing, were back on the wooden bench. This time, it was with severe depression. There was no bed still, but some patients who met him there were making it into the reception. A light-skinned, slender lady was the triage doctor on duty that day and she had begun taking trips from the reception to the car park, singing the no-bed-space rhythm. By then, Ebuka could not conceal his fears any longer. He broke into tears and sobbed carelessly, although muffling his tone. “Abeg, no cry o. No be now Beds officially you go cry o. Since all these available days, you no cry. Na now you wan come dey cry? No be now o. Just look for the sake of your children,” his wife admonished him. Ogbonnaya’s tears triggered a fresh wave of discomfort about the length of the uncertain wait. Blessing and I resolved to intensify pressure on the doctor. By then, I had won the couple’s heart, and it didn’t amount to going overboard when I introduced myself as Ogbonnaya’s younger sibling the moment the doctor showed up. I reminded her that Ogbonnaya had been struggling with pains since Tuesday. But this time, her response was a piece of paper recommending that I try the spillover section,
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news Global recognition for Glo at World... Continued from page 1
30 percent, public online
voting, 30 percent, while market research accounted for 40 percent, totaling 100 percent. Globacom, which recently marked 50 million subscribers on its network, was celebrated among other global brands, such as Apple, Netflix, Cadbury, Carlsberg, Nokia, DHL, Adidas, Ferrari and Rolex, at a glittering awards gala at the State Apartments, Kensington Palace, London. The World Branding Awards are organised by the World Branding Forum, a registered global non-profit organisation set up to advance the standards, skills and education of the branding community for the good of the industry and consumers. The Branding Forum explained that more than 4,500 brands from 57 countries were nominated for the 2018-2019 awards in multiple categories. Of these, only 351 brands from 49 countries were declared as win-
ners–81brandsfrom16countries were awarded in New York, and 270 winners from 33 countries werehonouredinLondon.Countries that did not receive enough votes did not qualify. Globacom has enjoyed quantum growth since it commenced commercial operation in Nigeria in 2003. Driven by commitment to innovation, the company has emerged as a globally respected telecommunications firm. The operator has earned worldwide acclaim for its unrivalled capacity for introducing competitively-priced products and services. It has pioneered several innovations in the voice and data segments of the market. With its Glo 1 international submarine cable and digital solutions such as artificial intelligence, smart cognitive learning and smart energy, Globacom said it has positioned itself to help Africa achieve a digitalised economy.
The Lagos hospital wards of deadly... Continued from page 42
a privately-run emergency just behind. The section is a private wing where patients not admitted to the emergency ward are forwarded. On the spot, the admission fee is N50,000, a fee without which nothing gets done. However, after a quick sizing up of Blessing and I, the receptionist did not delay to tell us there was no bed space. The same song echoed from a private emergency centre. In fact, it was hard to swallow that a private wing where we would be paying for special attention would turn us away on account of a lack of bed space. But, again, we probably just didn’t measure up as persons capable of coughing up N50,000 all of a sudden. Blessing’s low-cut hair was tastelessly wrinkled. My plaited hair had lost its fine lines to bushy undergrowth and edges. We couldn’t just quit. So, we appealed to them again to please double-check for the latest development. But the receptionist, frantically this time, asked us to check back later. When is later? She couldn’t answer. But just keep checking back, she said. LUTH’s ‘second to none’ spillover ward is a sham Under a scheme labelled LUTH Initiative, the Accident and Emergency Spillover Ward was inaugurated in 2009. It was designed as a 36-bed facility to save patients that can’t be absorbed in the main emergency ward, according to the details provided on the LUTH Initiative’s website. The original layout of the department is three wards each with the capacity to accommodate 12 patients. The first ward admits critically ill patients and those in row for resuscitation. The ward is touted as having a fully-equipped emergency cart in the resuscitation bay, two multi-parameter monitors, and oxygen supply guaranteed at all times with the presence of an oxygen
concentrator for backup to the regular cylinders. “The nursing care available at the spillover ward is second to none, with caring, dynamic, ready and eager-to-assist nurses available just a few feet from the patient. Doctors in the regular emergency department also provide cover for the ward, alongside the various specialty unit doctors,” says LUTH. But striking as these features are, all that glitters is not gold. At 7:11pm on Tuesday, November 12, only eight out of 12 beds were occupied by patients. Three were empty. There was a particular corner that naturally ought to nest about two beds but it was choked with four bare bedframes without mattresses on them. It was unlikely that all three of the empty beds would have been occupied as at 10:47am on Wednesday when we went seeking admission. According to the attending nurse, what started out as a 36bed facility was now operating with 20 beds. Therefore, more often than not, the spillover centre would turn down patients almost twice as much as the main emergency ward would. Refusing a patient was
L-R: Ogochukwu Emenike (winner); Okafor Ezendu Victoria, CEO of Havila Resources (winner); Izore Bamawo, head, CSR & sustainability, Keystone Bank Limited; Unachukwu Nkolika, CEO of Dax Mega Concept (winner); Helen Nwelle, head, MSME & value chain management, Keystone Bank Limited, and Pascal Nebeolisa of National Lottery Regulatory Commission, at the raffle draw event to select winners of Keystone Bank’s ‘Growbiz Account Save and Win’ promo at the bank’s headquarters in Lagos.
not unique to Ogbonnaya. I had become friends with five different relatives of patients whose efforts to get admitted to the spillover I monitored. Death, resurrection, no oxygen, second death Two weeks before this investigation, Mrs Adeniran literally died twice with the support of the unresponsive main emergency ward and the profit-centred spillover ward. The sweeper was a septuagenarian who worked 35 years in LUTH and still returned under locum staffing in the Ear, Nose and Throat (ENT) clinic. Suddenly, her health took an awful turn and she began incessant stooling, one night. She got worse and was rushed to the A&E, but was referred to spillover for lack of bed. In no time, she was declared dead. At the mortuary, however, an official who was to file her in noticed a strange gesture: a dead body breathing. Mrs Adeniran herself mustered a great deal of strength to wave her hand and the official was forced to announce to her relatives that she didn’t belong there. Another race to save her began, and she was back at the spillover. But the ward, which prides itself as having a guaranteed oxygen supply at all times with the presence of an oxygen
concentrator for backup to the regular cylinders, could not immediately provide oxygen for Mrs Adeniran. The ward asked her daughter to quickly get oxygen from outside and before she returned, Mrs Adeniran finally died a death that many familiar with the case believe would have been averted. She had the opportunity to live but there was no emergency response to seize the day. “She had no business dying,” a nursing official who cannot be named for fear of retribution told me. In Ogbonnaya’s case, the ward didn’t even give us the opportunity of admission; we were only assessed. By the time we returned about two hours after the initial visit, the receptionist had to come out clear that she doubted our ability to pay. One of the two security personnel at the gate offered to help, after explaining our frustration. He told us he saw some patients leaving earlier, meaning a space was possibly available. Once he led us in, reintroducing our case, the receptionist snapped at him, sternly reminding him that his duty post was at the gate.
• To be continued next week…
CBN introduces international tracking number to ease OMO trading SEGUN ADAMS
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he Central Bank of Nigeria (CBN) has commenced the issuance of the International Securities Identification Number (ISIN) on its OMO bills, after a policy to restrict local nonbank investors from the OMO window made it difficult to identify securities, trade and execute settlements. The International Securities Identification Numbers (ISIN) which would be issued on the bills comes almost two months after the apex bank had to clarify on the difference OMO bills and Treasury bills following its restriction policy. “Please be informed that the Central Bank of Nigeria has commenced the issuance of International Securities Identification Numbers (ISIN) to its OMO bills,” CBN said in a statement signed by Angela Sere-Ejembi, CBN’s Director of Financial Markets Department. The document was dated December 19, 2019, with reference number FMD/DIR/ CON/OGC/15/041. An ISIN number is a 12-character alpha-numerical number that does not contain information characterizing financial instruments but serves for uniform identification of a security at trading and settlement. The code uniquely identifies a security, such as stocks, bonds and more. “This is a move to further differentiate OMO bills from Treasury bills (NTBs) and ease settlement issues,” said Oluwatosin Ayanfalu, a fixedincome analyst at Lagosbased Zedcrest Capital. CBN in October, limited participation in its liquidity management operation (OMO) which saw local investors who are used to high-yielding low risks assets rotate into treasury bills, a short-term bond CBN issues on behalf of the government.
Big local investors, mostly Pension Fund Administrators, have remained risk-off towards the equity market currently at negative 15 percent year-to-date. This caused a heavy demand for NTBs and pushed rate on the instrument into single digits while OMO bills remained at double digits. Since OMO bills were still accessible to foreign buyers because of CBN’s need for dollars to stabilize the Naira, the foreign investors who also had holdings of T-bills saw an opportunity to profit by selling down their NTBs and buying OMO instead. Foreign investors became the major supplier of liquidity in the NTBs secondary market. Before the OMO restriction, both OMO and NTBs had been fungible or interchangeable prior as OMOs were issued shortly after NTBs to track them, according to someone familiar with the matter. “So what foreign investors have been doing in the last one month is to sell their NTB holdings, realise a massive capital gain and reinvest in OMO,” the person said. “It’s a clear arbitrage that anyone will do.” For the CBN exchange stability was paramount even though the foreign investors were being enriched with value transferred from locals. Nigeria’s reserve had fallen from $45.1bn in May to around $39.8bn and this was the bigger concern. “However the problem started when some foreign clients who wanted to sell their NTB were told by their custodians what they had bought was, in fact, OMO bills,” the person said. “There are now whispers that some custodians have been doing illegal commingling.”
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Nestlé to increase local sourcing beyond 80%, boost support for local supplier ecosystem CALEB OJEWALE
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estlé Nigeria plc has disclosed it is pursuing an aggressive roadmap to increase its local content from its current level of 80 percent. This, the company says, is to consolidate its position at the forefront of supporting the growth of SMEs in Nigeria through its local sourcing and backward integration and supplier development initiatives. At its 2019 Suppliers’ Day event in Lagos, an annual event which brings together key suppliers of its raw materials, packaging materials, services and indirect services to share best practices, Nestle reiterated in a statement that local sourcing is not only a smart business decision to ensure supply but also the right thing. This is because, it contributes to transforming small and medium scale businesses involved in Nestlé’s value chain either directly or indirectly. Raw materials currently sourced locally by Nestlé in-
clude maize, cassava, palm olein, sorghum, soya and salt. The company also sources over 90 percent of its packaging materials locally. The company says it is exploring more local sourcing opportunities, which still exist for various spices, vegetables and highquality cassava flour. “Responsible sourcing has always been at the core of Nestlé Nigeria’s operations,” said Nestor Finalo, supply chain manager for Nestlé Nigeria in a presentation. “We are committed to long term partnerships with our suppliers as we sustain efforts towards increasing the percentage of raw and packaging materials sourced locally.” He reiterated that quality remains non-negotiable. “As a company, we prepare for the future by investing in new technologies and products while maintaining our strong focus on quality and striving for zero impact of our operations on the environment,” Finalo said. Sunday Bamikole, quality assurance manager, Plantation Industries Limited, who
expressed satisfaction with the Suppliers’ Day event, highlighted “the fact that Nestlé is supporting and taking the lead towards ensuring suppliers are GFSI certified and commend the company for the sincere interest and support towards making our organisations globally competitive while building long term relationships with us.” Similarly, Loretta Balogun, MD/CEO, LORYB & DP Ventures Limited, said, “Indeed, Nestlé is committed to not only sourcing all their raw materials locally but is also investing in small holder farmers in Nigeria by training them in best agricultural practices and empowering them to ensure they have a good life”. Every day, Nestlé says it continues to touch lives across its value chain, in line with the company’s business principle of ensuring that it provides value for society while delivering value to its shareholders. While the company plans to increase its local sourcing as contained in the statement, the percentage growth being targeted was not indicated.
Tin-Can, PTML ports record backlog of uncleared vehicles, containers …over Customs’ promotional exams, breakdown of SON’s platform …There was no lacuna in our operations, says Tin-Can Customs AMAKA ANAGOR-EWUZIE
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usinesses that depend on Nigerian seaports for the importation of finished goods and raw materials for the local industries have recorded several losses in the last few days. This is due to their inability to take delivery of their consignments earlier last week from the Tin-Can Island Port and the Ports and Terminal Multipurpose Services Limited (PTML). The development, BusinessDay gathers, was largely due to the vacuum created by the just concluded promotional examinations for senior officers of the Nigeria Customs Service (NCS) in the assistant controller and deputy controller levels. The situation has created backlog of uncleared containers and vehicles that ought to have been moved out of the ports if the Customs releasing officers were on ground last week to release the goods. It was also discovered that efforts of Customs area controllers of the two commands to avert lacuna in cargo clearing proved abortive as representatives appointed in both commands to deputise for the officers were not able to release much consignments due to difficulty in recognising biometric. This was because most releasing officers had their biometrics attached to the Nigerian Integrated Customs Information System II (NICIS II), an online platform that enables cargo release at the ports. Aside from the delay caused by Customs promotional exams, it was also discovered that breakdown of the Standards Organisation of Nigeria’s online platform created another problem that
left importers and their agents stranded as they were not able to obtain the necessary documentation for taking delivery of their consignments as and when due. Segun Akanbi, an agent, said that no vehicle or container was released at PTML when senior officers went to Abuja for their promotional examinations. “Though some officers were appointed to stand in for them, they were not able to do anything. Most of us wanted our vehicles out but that was not possible last week,” he said. Emeka Onuoha, another agent, said he had a vehicle at PTML and a container at TinCan Island but the problem affected both of them such that he was not able to clear them out from the port. Jonathan Nicol, president of Shippers Association of Lagos State, who confirmed the failure of the SON platform, said importers are finding it difficult to get their Form M approved, which the banks should handle. According to him, importers are losing an average of N80 billion a day to high cost of doing business associated with payment of demurrage and storage charges to shipping companies and terminal operators as a result of the delays in clearing goods from the ports. “It is horrible that SON platform has broken down, when the Nigerian Shippers Council (NSC) has called for simplified procedures in cargo management. This means our Import Adjustment Policy should be reviewed immediately,” Nicol said. Tony Anakebe, managing director, Gold Link Invest-
ment Ltd, told BusinessDay in a telephone interview that his company worked on the release of some consignments in Apapa Port all through last week without any impediment. According to him, cargo clearing and release by Apapa Customs was not impeded by the promotional exams of senior officers. Uche Ejesieme, public relations officer, Tin-Can Island Port Command of Customs, however, said Customs operates a system that abhors vacuum. “As soon as we got the circular for the promotional exams, we studied the whole systems and we tried to regularise some of the places that the releasing officers may not be on ground, and the Customs Area Controller had to do small adjustment to avoid creating a lacuna,” he said in a telephone interview. In addition, he said, Customs informed the agents of the opportunity of going to the Customs Procedure Code (CPC) or Customs ICP centre to release their consignments because, the processes were automated. “The main fact that the releasing officer went for a promotional exam does not mean that Customs process has to come to a halt. I believe that those people making the allegations were just ignorant of how Customs process runs. We also informed the agents through their respective associations,” Ejesieme said. Ejesieme stated that all the officers that went for the promotional exams were back on their duty posts as they returned last Thursday because it was an exam that lasted for just few hours not weeks.
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ElectHER launches $10m election campaign fund to support women to run for office in 2023
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he race for Nigeria’s 2023 general election is gaining momentum as Social Change Network (TSCN) Africa and Women in Leadership Advancement Network (WILAN) have partnered launch a joint initiative, ‘ElectHER’ to promote an increase in female representation in politics. This initiative, launched in Abuja, is an end-to-end women’s political advancement initiative aimed at improving the significantly low representation of women in Nigerian politics by engaging, encouraging, equipping and enabling women to Decide, Run and Win elections. At the launch, founder of TSCN Africa and co-founder of ElectHER, Ibijoke Faborode, expressed disappointment over the statistics of women in Nigeria’s political landscape, especially young women and those living with disabilities. She said, “With women constituting half of Nigeria’s population, it is underwhelming to see that there are only eight female senators out of 109 and only 11 female members of the House of Representatives out of 360, which has earned us the poorest record of representation in Africa with only 4.1% of our leaders and policymakers being female.” Speaking with some of the challenges that account for these figures, founder of WILAN and co-founder of ElectHER, Abosede GeorgeOgan, highlighted, “Women are faced with an uphill battle when venturing into the political space. From the lack of a formidable support network, inadequate financing, religious and cultural stereotypes, and violence, women are often frustrated out of fulfilling their political ambitions.” Also commenting in her keynote address, the Nigerian country representative, UN Women, Comfort Lamptey, emphasised the significance of women’s political leadership to unlocking socioeconomic transformation in Nigeria. At the launch, which was attended by representatives from the National Democratic Institute (NDI), International Republican Institute (IRI), UN Women, European Union (EU), Accountability Lab, YIAGA and The Election Network amongst others, Ibijoke and Abosede shared the outlook for ElectHER from 2020 to 2023. According to them, ElectHER is an end-to-end solution that will engage multiple stakeholders and challenge existing stereotypes to change behaviour encourage women to decide, equip them to run and enable them to win elections. Through its $10 million election campaign fund, ElectHER will support up to 1,000 women to run for office in the 2023 elections.
Why FG should review Oil/Gas Local Content Act - PENGASSAN JOSHUA BASSEY
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etroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) is canvassing for the review of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act to further guard against abuse in the industry. Against this background, the oil workers have called on the Federal Government to constitute a special review committee made up of industry stakeholders. The stakeholders, according to PENGASSAN, should include
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the Nigerian Content Development Monitoring Board (NCDMB), Department of Petroleum Resources (DPR), Federal Ministry of Labour and Employment, labour unions, among others, to undertake the review of the local content policy. This was part of the resolutions reached at the end of the National Executive Council (NEC) of PENGASSAN, recently held in Abuja, the nation’s capital. In a communiqué signed by Ndukaku Ohaeri, and Lumumba Okugbawa, president and general secretary, of PENGASSAN, respectively, the oil workers also argued that if the local content
policy must be strictly complied with, there is the need for the government to exert appropriate sanction (s) against defaulting employers in the industry. The workers equally backed the House of Representatives’ plan to investigate the implementation of the local content involvement in the sector, saying such will enable the country and stakeholders in the oil industry determine the level of compliance with the Nigerian Oil and Gas Content Development Act. “The NEC advises that the issue bordering on the NOGICD Act, should not be limited to the name or material components
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of jobs alone but should be on increasing the number of Nigerian employees and transfer of knowledge, especially those in top Management positions,” the communiqué read. The union equally decried the behaviour of some management of some companies in the industry in relation to the provision of the labour law “especially with reference to victimisation of union leaders who engaged in legitimate businesses of the union and warned erring management in the industry to desist. It warned that the union
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would not delay in reacting appropriately and proportionately against such maltreatments to its members, going forward. They also called for the review of guidelines and procedures for staff release in Nigeria oil and gas industry The union, nevertheless, commended the Federal Government for the review of the guidelines and procedure of staff release in the Nigeria oil and gas industry. It urged the DPR to follow through with the implementation and compliance of oil and gas companies to this new regulation without compromise.
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FG rejects religious freedom violation tag on Nigeria by US ... says it feeds on discredited narrative Innocent Odoh, Abuja
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ederal Government has rejected the United States designation of Nigeria as a country that engages in or tolerates severe violations of religious freedom, saying the “iniquitous tag stems from an orchestrated narrative that has long been discredited.” In a statement issued in Abuja on Sunday, the minister of information and culture, Lai Mohammed, said the good people of Nigeria enjoy unfettered freedom to practise their religion, and blamed failed politicians and disgruntled elements - some of them supposedly-respected leaders - for latching on to religion as their trump card, especially in the run up to the last general elections, to oust the Buhari administration. The US Secretary of State, Mike Pompeo, in a statement on Friday listed Nigeria as one in the Special Watch List (SWL) of countries that have severe violations of religious freedom. This followed the release of the 2018 report of the US Commission for International Religious Freedom, which recommended Nigeria’s designation as a “country of particular concern.” The report said the Federal and State Governments in Nigeria had continued to “suppress the freedom to manifest religion or belief and tolerate discrimination on the basis of religion or belief.” The US report pointed at the Boko Haram as a strong fac-
tor in the violations of religious freedom as well as the sporadic religion-instigated violence in Northern part of Nigeria. The Boko Haram insurgency has in the last 10 years led to the death of about 30,000 people, the displacement of about 2.8 million and massive destruction of infrastructure, particularly in the North East of Nigeria. The US also mentioned the widespread violence allegedly perpetrated by the Fulani herdsmen, especially in central Nigeria, which has led to the killing of thousands of indigenous farmers in a move suspected to be an attempt by the mostly Muslim Fulani herdsmen to supplant mostly indigenous Christian people to grab their land for grazing. Another strong factor that necessitated the listing of Nigeria is the alleged killing and repression of the members of the Islamic Movement in Nigeria, otherwise known as Shiites, and the continued detention of their leader, Ibrahim Zakzaky. The sect has come under a heavy crackdown by the Nigerian security agencies under the current government since 2015 when about 400 of the Shiites were killed by soldiers who had accused them of plotting to assassinate the Chief of Army Staff, Tukur Buratai,a Lt General. The Shiites have allegedly continued suffer more killings even as they protest the continued detention of their leader, Ibrahim Zakzaky.
39 firms bid for construction of Lagos 4th Mainland Bridge Joshua Bassey
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bout 39 construction companies, most of them from Europe and Asia, have expressed interest in the construction of the long-proposed Lagos Fourth Mainland Bridge. This followed the opening of the bid for expression of interest in the project by the Lagos State government some weeks ago. Some of the companies that expressed interest in the project include Julius Berger, China Civil Engineering Construction Corporation (CCECC), Kyeryong Construction Company, Pythagoras Holdings, CRCCCI Nigeria, China State Construction and Engineering Corporation Nigeria Limited, Bua International Limited, China Jiangxi International Economic and Technical Cooperation Company Limited, among others. The government opened the bid to unveil the companies that expressed their interest for the project on Wednesday, in Ikeja, Lagos, with 39 companies signifying interest in the project. Aramide Adeyoye, the special adviser to the state government on works and infrastructure, said at the
unveiling of the bid in Ikeja, on Wednesday that the first of the six stages before a winner would be selected to construct the Fourth Mainland Bridge, describing the process as very transparent. She said since the government did not have the fund for the project, it had to place it under the Public-Private Partnership, PPP, arrangement, saying government was encouraged by the number of companies that bid for the project worldwide. Adeyoye explained that the next step, which is the evaluation stage, would begin on Thursday, saying that the companies that qualified for the next stage would be contacted. Peter Agunbiade, managing director, Advanced Engineering Consultants, said the journey to construct the Fourth Mainland Bridge began many years ago, and that the administration of Governor Babajide SanwoOlu had made it possible for the construction of the bridge to be revisited. He said companies in Europe, Asia and others duly expressed interest in the project, assuring that the state government would ensure transparency in executing the bid. www.businessday.ng
L-R: Kayode Adesoye, head, financial reporting and business intelligence, Leadway Assurance; Oye Hassan-Odukale, MD/CEO, Leadway Assurance; Ehi Ogbeide, head, internal control, Leadway Assurance; Tom Isibor, country head, Association of Chartered Certified Accountants (ACCA), and David Abitoye, chief financial officer, at the presentation of award of ACCA Approved Employer – Trainee Development to Leadway Assurance by the ACCA, in Lagos.
How Trump’s possible impeachment could impact investor sentiment, economy ENDURANCE OKAFOR
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hough the odds may be stacked in his favour, United States President Donald Trump will next month face the Senate which will hold a trial on whether or not to convict and remove him from office. The 45th president of the United States was impeached on Wednesday by the House of Representatives on charges of abuse of power and obstruction of Congress. Trump has demanded an immediate impeachment trial in the Senate, amid an impasse among Democrats and Republicans over when it may start, with Democrats arguing the Republican-controlled Senate is refusing witnesses and will not hold a fair trial. “If further momentum builds behind the Democrats’ efforts, the health of the US economy will become even more critical,” Nicholas Spiro, a partner at Lauressa Advisory, said. The dramatic increase in US
political risk injects yet more uncertainty into an already perilous global economic and policymaking environment. While the communiqué issued at the end of the IMF and the World Bank’s annual meetings in October agreed that the global economy is not slipping into recession as many have forecast, the trade war with China, rising tensions in the Middle East and fears over the health of the global economy have unsettled markets recently, and led the US central bank, the Federal Reserve, to maintain low interest rates. The US Fed tends to hold off on raising interest rates if it reckons the economy is decelerating. While higher rates push up borrowing costs for companies and consumers in the US, they hold capital inflow and cheap cost of borrowing opportunities for an emerging economy like Nigeria. “A lower rate by the Fed simply means the possibility of increased FPI flows into emerging markets. Nigeria’s money market instrument
remains a big attraction for foreign investors, thus Nigeria may see more inflows into that space,” Ayorinde Akinloye, a consumer goods analyst at Lagos-based CSL Stockbrokers, said. However, data by the National Bureau of Statistics (NBS) showed capital inflow into Nigeria declined in Q3 2019 by 7.8 percent to $5.37 billion, from $5.82 billion in Q2 2019. Both Foreign Direct Investment (FDI) and Foreign Portfolio Investment (FPI) saw a drop in inflows by 10 percent and 30 percent, respectively. The result from a recent CEO survey by a US-based CE O- fo cus e d publis her showed that the current situation in the US is not only delaying investments, it is also endangering an otherwise stellar climate for business, and that if Washington doesn’t straighten up soon, the economy could take a severe downturn. “Widely varying signals from the US administration on approach to trade and tariffs (are) crippling business confidence
and ability to plan,” said Tim Zimmerman, president and CEO of Mitchell Metal Products, who is among the surveyed CEOs forecasting declines in both revenues and profits over the coming year. Speaking on the US-China trade war and the global economy, Bismarck Rewane, CEO, Lagos-based Financial Derivatives Company, said Nigeria should be concerned about how as a country it is going to be more competitive going forward. “There is a risk if things go out of control; we could end up in a global recession, not a global financial crisis, in which we are also going to suffer as commodity prices will come down,” he said. Akpan Ekpo, a former director-general, West African Institute of Financial and Economic Management and professor of Economics and Public Policy, University of Uyo, said “slow growth in the US will lead to slow global growth rate, and once the global growth rate slows down or is sluggish, it will affect Nigeria’s growth performance”.
Presidency says refusal to share oil wells pitched elites against Buhari, denies existence of cabal James Kwen, Abuja
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residency at the weekend said the refusal of President Muhammadu Buhari to share oil wells to selected few was one of the main reasons many Nigerian elites were against his person and government. According to the Presidency, “The elites see Buhari as a bad man because you cannot go to him and say give me oil well and he will sign papers and give you.” Presidential spokesman, Garba Shehu made this assertion during interaction with journalists covering the ruling All Progressives Congress (APC) in Abuja, dismissing claims that Buhari’s administration had been hijacked by a cabal, which he said “does not exist,” emphasising that no President could
operate alone without having a team of close confidants. He noted that in other climes, every president usually has a ‘Kitchen Cabinet’, but in Nigeria, the opposition both within and outside the government would prefer to refer to such collection of ‘self-sacrificing’ individuals as cabals. “What is the meaning of cabal? I just googled Thesaurus and among many other definitions, what they are saying is that cabal means ‘conspire, intrigues, mystique, occult, secret’. “There is no government in this country that we have had that some people were not accused of being a cabal in that government, and it is because every administration, every president must have a secretariat. “Every president must
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have people who advise him. It is not a sin; it is not an offence to have people that you take into confidence. Elsewhere, they call it ‘Kitchen Cabinet’, but in our own country we are being derogatory and we term them the cabal so that it will tarnish their own good standing,” Shehu said. The presidential aide also called on the media industry as a critical stakeholder to proffer media-driven solutions to the problems being created by the social media, stressing that the ongoing review of media regulations is not intended to weaken it. “Social media has become a problem for many families because rights of women and children are being abused. There is a need to protect vulnerable members of the society. @Businessdayng
There is need to protect minority, whether tribal or religion in our own country. “So, it makes sense that you as media stakeholders come around the Minister of Information and Culture and formulate the kind of regulation you want so that it is not that there is top bottom approach, so that government will not be accused of imposing a regulatory mechanism on the media. “The minister is saying come, sit down with me and let us talk about it. And I was told that the day he called on NUJ, they walked out of him. If that report is true, I think it is very unfortunate. I think we need to come around him and offer media driven solution so that at the end of it this country will have a vibrant and effective social media communication system,” he said.
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Community support can help address infrastructural challenges - Oseni ODINAKA ANUDU
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hief risk officer, Risk Management Division, Bank of Industry (BoI), Ezekiel Oseni, says citizen participation can help in addressing infrastructural challenges in Nigeria. Oseni expressed concerns that some public institutions in the country were in bad shape, citing court buildings, police stations, secondary schools, market places and electric projects as examples. Delivering a keynote address at the 2019 Aran-Orin Progressive Union (APU) Harvest in Lagos themed ‘Community Development: Whose Responsibility?’, he said there was an urgent need to complete all the abandoned projects in the state. Oseni said community development involved the participation of people in harnessing their local resources and maximising it to their most favoured advantage. According to Oseni, com-
munity development demands responsibilities from community leaders and helps to identify specific challenges, empower and reduce poverty, unemployment and other problems facing them. He pointed out that government should be accountable to its citizens by leveraging its performance to build enduring structures, institutions and legacy that would last. He said several communal efforts had been made by locals within the community to bring development to the towns and communities. He noted that several individuals had made laudable efforts to pull massive development to the state by bringing the indices of development and growth to the state such as the electricity projects, water project, dredging of roads, schools, water dam, university of Ilorin satellite campus, market places and worship centres in Kwara State. ‘’The initiatives of the community members made sure
that development was brought into the towns much earlier by the great efforts of the individuals in the state and it should be encouraged,” he said. He advised APU leaders to be more transparent and accountable at all times to make personal sacrifices to the people. Earlier, Joseph Gboyega Ajiboye, APU Lagos chairman, had said Aran-Orin Progressive Union was geared towards tackling the challenges of underdevelopment in Kwara state, adding that the people of the state were saddled with the task of corporate social responsibility and community action. Ajiboye, however, called on the state government to expedite actions towards ensuring that infrastructural challenges were effectively tackled. He said the new call was against the backdrop of the poor infrastructure gap, w ea k e c o n o m i c p e r f o rmance and fragile institutions in the state.
Lagos to develop aquaculture for foreign earnings - Sanwo-Olu JOSHUA BASSEY & SEYI JOHN SALAU
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agos State governor, Babajide Sanwo-Olu, has again reiterated his administration’s desire to develop and grow the state’s aquaculture value chain as a foreign earner for Lagos. “We believe strongly that a sustainable development of tourism potentials in aquaculture and its value-chain will not only foster economic growth but also create jobs, contribute to poverty reduction and also unleash opportunities for entrepreneurship,” said Sanwo-Olu. He stated this at the 2019 Lagos Seafood Festival organised in collaboration with Sirocco Productions Limited, themed ‘Celebrating the Seafood Diversity of Lagos State’, and held at the Muri Okunola Park, V.I, yesterday. Represented by Obafemi Hamzat, the state’s deputy governor, Sanwo-Olu said the state
is working to encourage everybody along the aquaculture value-chain in Lagos. “There exist the potentials for increased production towards the attainment of our food security objective, foreign exchange earnings from export and ultimately contribute to the growth of the state’s GDP. “We have established Fish Farm Estates in Ikorodu and Epe, which primary aim is to ensure a geometrical increase in fish production with the active participation of the private sector. “While the Ikorodu estate is fully subscribed and produces 10,000 tons of fish per annum, the Ketu Ereyun Epe estate will produce 11,000 metric tons on completion of its first phase. “All of these initiatives are aimed at bridging the demand and supply gap which is estimated at 374,000 tons per annum and 155.262 tons per annum respectively,” said
Sanwo-Olu, urging the business community in Lagos to seize the opportunity of investing in the highly rewarding sector. Gbolahan Lawal, Lagos State commissioner for agriculture, said the celebration of the state’s Seafood Festival will boost the development of the creative industry and promote visibility of the state as a tourist destination in alignment with the entertainment and tourism pillar of the state government’s THEMES developmental agenda. “In accordance with the theme of this year’s festival, the rich seafood diversity of the state will be projected through the display of various fresh, processed and wide varieties of seafood based dishes by our exhibitors. This is strengthened by the fact that fishing is the main occupation of the people living in the coastal zones and along the vast lagoon network of the state,” he stated.
53,674 pass, 19,273 fail TRCN exams - registrar REMI FEYISIPO, Ibadan o less than 53,674 candidates passed the November diet of the Professional Qualification Examination (PQE) organised by the Teachers Registration Council of Nigeria (TRCN). The registrar/chief executive, Segun Ajiboye, on Sunday said the results signed by the Registrar revealed that 72,947 wrote the examinations in various centres across the country out of which 19,273 failed. Ajiboye, a professor, who stated this in Ibadan while speaking with newsmen, appreciated the commitment of Nigerian teachers to excellent delivery in spite of the challenges they face and the support given to TRCN to reposition the teaching profession in the country. Lagos State topped the list of those who registered for the
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examination with 8,224, while 6,067 passed the examination. This is followed by Oyo State with about 5,599 registered while only 4,243 passed followed by Kaduna where 3769 passed out of 4,008 who registered for the examination. According to Ajiboye, the professional qualification examination is a continuous
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thing and urged unqualified teachers to register and write the next diet to escape the sanction, which awaits uncertified ‘teachers’ in 2020. “PQE is a continuous thing and the door is still open to those who have not registered to do so. And those who failed the examination still have opportunities of retaking the exam.
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cityfile Kwara: How we recovered N70m from looters – EFCC SIKIRAT SHEHU, Ilorin
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conomic and Financial Crimes Commission (EFCC) says it has recovered additional N70 million from alleged corrupt persons in Kwara State. The commission disclosed that the latest recovery of looted fund was from its ongoing investigations into the spending of the Kwara State Internal Revenue Service (KWIRS). The agency had in October this year handed over recovered sum of N112 million to Governor Abdulrahman Abdulrasaq, in Ilorin, the state capital. Head, Ilorin zonal office of EFCC, Isyakyu Sharu, made the disclosure while speaking as a guest on a national television monitored in Ilorin at the weekend. He said: “We beam our searchlights on political office holders, civil servants and internet fraudsters. I can tell you that from our ongoing investigations into the spending of KWIRS, we have recovered additional N70 million. “We came on the eve of 2019 general elections, we embarked on anti-vote buying; our role in the election made the exercise to be free, fair and credible. We discovered that about N1 billion was diverted by the some government officials, we investigated it and saved the state’s resources” On other achievements of the zone, Sharu revealed that “as it is today, we have 44 convictions in Ilorin zonal office, 42 of them was prosecuted on offences that border on internet fraud and related offences. We must join hands to fight the menace of internet fraud because it affects our image as a country. “Parents, traditional rulers and religious leaders must play their role in the fight against corruption” Sharu appealed to the people of Kwara, Kogi and Ekiti States to continue to partner with the EFCC by giving relevant information that could assist the commission in the discharge of its responsibilities.
Group seeks improved welfare for ‘disabled’ persons REGIS ANUKWUOJI, Enugu
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he Joint National Association of Persons Living With Disabilities (JONAPWD), Awgu local government branch, Enugu State, has appealed to government at all levels to improve on their level of assistance to them. The branch chairman, Ifemelumma Chukwujike made the appeal during an event to mark World Day for persons living with disabilities held, weekend, in Awgu. He said that government decisions were affecting their members negatively, as it was no longer easy for them to participate in programmes organised by the government, “because many of us cannot obtain National Identity Card.” “For instance the Joint Admission and matriculation Board (JAMB) has made national identity card compulsory for any candidate seeking to register for its exam, banks have also hinged transactions on national identity card and the relocation of the office national identity office from Awgu has made it difficult for our members to obtain this important document.” He said that Awgu local government used to have a centre when the programme, and it was easy for them then, but that the office lasted for only two years and it was closed down and relocated to Enugu town, a decision that added to the sufferings of their members who now must go to Enugu, which is not easy. “As it is now, all the persons living with disabilities in Awgu local government area, who had not gotten the national identity card for the two years the office was in Awgu are denied of all the programesandempowermentcomingfromboth the federal and state government,” he lamented.
Officials of the Nigeria Customs Service raiding a shop with foreign rice and other banned items in Mubi Town market in Adamawa. NAN
A’ Ibom, Chinese partners to build technology park ANIEFIOK UDONQUAK, Uyo
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overnor Udom Emmanuel of Akwa Ibom State has performed the foundation laying of a science and technology park in Uyo, the state capital. The proposed park known as Ibom Blue Sea Science and Technology Park, to be funded by a consortium of Chinese investors, will comprise a powerplant, technical university, vocational training centre and a hi-tech building materials plant. It is expected on completion to unleash employment opportunities and further aid industrial development of the state. The park is also seen as a replacement of a similar project initiated by the former governor of the state, Victor Attah, which was later abandoned even after more than 90 per cent of the contract sum had been paid by the state government. Attah governed the state from 1999 to 2007. Attah’s successor in office, Goodswill Akpabio, (2007-2015) had raised a committee to investigate the abandoned science park project. Although the committee submitted
its report, its findings and recommendations were never implemented. As at the time the project was abandoned in 2006, its estimated cost was N6 billion, of which more 95 percent had been paid to the contractors, according to the findings of the committee. Speaking, Governor Udom called on foreign investors to explore the vast business opportunities in the state, assuring of good returns on their investments. “We’ve created an environment for people to come and invest, we are calling on other investors, other Chinese companies that are here, let them come, we will collaborate and make sure they invest in Akwa Ibom and reap returns on their investment,” said Udom. He added that the project would be funded by China Blue Sea International Holdings, and would be a major breakthrough in the industrial development of Akwa Ibom. Victor Attah, who was present at the event, applauded Udom’s decision to revisit the project. Attah said the Ibom Blue Sea Science and Technology Park was an expansion of his
initiative with the inclusion of facilities such as the vocational training centre, university of technology and a five-star hotel. “I have come here because I feel really fulfilled. I thank the governor, not just because he has revived what I know is going to be a life transforming project, but because in so doing, he has brought an end to that era of destructive politicking whereby we turn our back on projects initiated by our predecessors.” Consul General of the People’s Republic of China, Chu Mac Ming, acknowledged the existing mutual diplomatic relations between Nigeria and China and commended Akwa Ibom State government for revisiting the science park project. Ming emphasised the readiness of his home government to partner with the state in the development of the economy and directed China Blue Sea International Holdings to deliver the project on schedule and in high quality. “I require that the Chinese company will finish this project and deliver the project in due time and in high quality, that is a requirement, that is not a request. We must ensure the quality, we must ensure the efficiency”, he stated.
Insecurity: Police launch surveillance vehicles INNOCENT ODOH, Abuja
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he Nigeria Police has commissioned critical operational vehicles in the drive to re-define policing across the country At the commissioning of the security assets by President Muhammadu Buhari, in Abuja on Friday, the Inspector General of Police, (IGP) Mohammed Adamu listed the critical operational vehicles to include 139 Hilux patrol vehicles, 46 police smart surveillance vehicles with CCTV cameras. Others include 11 tactical operations vehicles fitted with state-of-the-art surveillance equipment; 9 Armoured Personnel Carriers (APCs), 5 troop carriers, and 7 anti-riot water cannon trucks. Also commissioned was the Nigeria Police National Command and Control Centre (NPF-C4i) as well as the first phase of the Nigeria Police Crime and Incident Data
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Base (NPC & IDB) Centre. The IGP said the acquisition of the police smart surveillance vehicles would help increase the momentum of fighting crime in the country. “The vehicles will be deployed for real-time electronic monitoring of the Abuja-Kaduna highway and other major highways and vulnerable locations across the country, including the electronic surveillance of NNPC pipelines in the country.” The IGP noted that the patrol vehicles on the other hand, would be utilised to strengthen the Safer Highway Patrol scheme, while the tactical APCs would be used for special police operations especially, in support of anti-banditry, anti-kidnapping and anti-robbery operations. The water cannon trucks shall be deployed for the management of civil disorders within the dictates of our demo-
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cratic values, rule of law and international best practices. “The Nigeria Police National Command and Control Centre (NPF-C4i) will enhance effective operational coordination and real-time monitoring of situations via video link between the force headquarters, Abuja and all the 36 state police commands and the FCT. “Similarly, the Nigeria Police Crime and Incident Data Base (NPC & IDB) Centre is to aid the Nigeria Police in acquiring a credible electronic criminal database to support criminal investigation and strategic operations and tactical planning. The acquisitions represented the first phase of the re-equipment plan and “with the effective take-off of the police trust fund, we shall sustain our blueprint of modernising all components of our operations towards addressing any form of threat to our internal security,” Adamu said.
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Monday 23 December 2019
BUSINESS DAY
COVER
Economy
Here are Nigeria’s happiest & least happy states so far
The biggest waste of money in 2019
Happiness is a state of the mind but it could also be dependent on where you live - if you go by what economists say happiness (and misery) really is.
Making and spending money is an activity we all participate in as individuals. The rule is to make more money than is spent but we suck at that sometimes- even Nigeria does.
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Monday 23 December 2019
BUSINESS DAY
Monday 23 December 2019
BUSINESS DAY
Cover Story
Economy
Here are Nigeria’s happiest & least happy states so far
The biggest waste of money in 2019
SEGUN ADAMS
SEGUN ADAMS
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appiness is a state of the mind but it could also be dependent on where you live - if you go by what economists say happiness (and misery) really is. A misery index measures inflation and unemployment to gauge how happy or sad people are. The assumption is that “misery tends to flow from high inflation, steep borrowing costs and unemployment,” said Steve Hankes, a renowned economist who revised Art Okun’s original misery index. You don’t necessarily have to accept such a measure for happiness to agree that when jobs are available, and the price of good and services is not rising too fast, people are content. In this article BusinessDay provides a simple misery index (based on the latest unemployment and inflation data as of Thursday, 19 December 2019) to rank states (excluding Abuja) and show where happiness is (or really isn’t) in Nigeria, which ranks 85 out of 156 countries on the 2019 World Happiness Index. Happiest States Osun State (21.96) Having the least unemployment rate in Nigeria where national unemployment is at an all-time high helps Osun state rank as the least miserable (or happiest) state in the country. Osun, which is an inland south-west state, has an unemployment rate of 10.07 percent and an inflation rate of 11.89 percent. The state’s economy is largely based on agriculture, and in 2018 Osun had an Internally Generated Revenue (IGR) of N2,206 per head according to BudgIT while it also ranks 13th out of 37 states (plus FCT) on Human Development Index based on the National Human Development Report 2018. As at half-year 2019, Osun had an IGR of N10.205bn, the 18th highest for states without counting Abuja, the National Bureau of Statistics (NBS) data shows. Oyo State (22.19) Oyo state has Ibadan, West Africa’s biggest city by territory, and also has the second-lowest score on the misery index by states-which is a good thing. The state which thrives mainly on agri-
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culture and handicrafts has an unemployment rate of 10.34 percent, which is the second-least rate among states in Nigeria. Its inflation reading in November was 11.85 percent which brings its ‘misery’ score to 22.19 percent. Oyo last year had an IGR per head of N3,142 per head and ranks 23rd on states human development index. The state’s IGR as of June 2019 was N14.06bn, the 13th highest among states in the country. Katsina State (24.95) Katsina is the state with the thirdlowest inflation rate and fourth-least unemployment rate, both facts which make the North Central state the third happiest state. Farming is the major activity in Katsina where IGR per head at N889 was the lowest in the country last year. The state also ranks second from the bottom of the list that ranks Nigerian states by human development. At half-year, Katsina had generated N4.8bn internally which makes it better than only five other states on that measure. Ondo State (25.78) The unemployment rate in Ondo in the third lowest in Nigeria and its inflation www.businessday.ng
rate is the 10th lowest too-both at 14.24 percent and 11.54 percent respectively. Ondo is Nigeria’s lead cocoa-producing state and its IGR per head in 2018 at N5,306 was the eighth highest. From a human development perspective Ondo rank 17th of 37 states (plus FCT) and as of June 2019, it has the eighth-highest IGR-N19bn. Lagos State (26.75) Nigeria’s commercial capital and fifth biggest economy in Africa, Lagos is the fifth happiest state. Lagos has the 16th highest inflation rate in the country based on November figure of 12.02 percent but its unemployment rate of 14.55 percent is the fifth-lowest in Nigeria. Though at fifth spot, Lagos comes first in a lot of other instances; the state had the highest IGR per of N30,451 in 2018 and as of half-year 2019 it has an IGR of N205.16bn which not only is the highest for any state but also more than the combined sum of the other five states that rank next. Lagos ranks number one in terms of human capital development in Nigeria. Not-so-happy States Akwa Ibom State(49.22) Having the ninth-lowest inflation rate
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is nothing if a state has the worst unemployment rate in the country-Akwa Ibom’s misery index score which is the highest shows why. Akwa Ibom is Nigeria’s most miserable state-as it was in our June misery index. Rivers State (48.99) Being oil-rich is no guarantee of happiness. With the sixth-highest inflation rate and the second-worst unemployment record Rivers is the second most miserable state in Nigeria. Kano State (44.61) The nerve centre of northern Nigeria is the third least happy place in Nigeria because of a high rate of inflation and unemployment. Inflation is 13.36 percent which is the fifth-highest in Nigeria while unemployment is 31.25 percent, the sixth-highest. Abia State (44.06) It doesn’t take much to drop two notches lower and rank fourth most miserable state in the space of about six months. Abia has the 14th highest inflation rate (12.45%) and the fourth-highest unemployment rate (31.61%). Bayelsa State (43.89) Bayelsa is another oil-rich state that ends up fifth least happy state because of high unemployment (the third highest in Nigeria at 32.56%) while its inflation at 11.33 percent is the eighth lowest in Nigeria. Bayelsa’s ranking worsened by one spot from our ranking in June where it was the fourth miserable state.
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aking and spending money is an activity we all participate in as individuals. The rule is to make more money than is spent but we suck at that sometimeseven Nigeria does. Recently the government although revenue-challenged approved N37bn approved for National Assembly renovation, and this got the public upset. In this article we highlight the biggest financial waste that occurred this year; some were money opportunities missed and others are gross mismanagement. Deciding New Election Date (N3 trillion or $10bn at N306/$) When you have at least four years and a N189bn budget to prepare for an election, it is reasonable to expect that all loose ends are tied before the D-day. That is not the case in Nigeria where the electoral commission has a bad habit of posting elections. A last minute change of heart in the 2019 general elections due to ‘logistics issues’ proved too costly, shaving N3trn ($10bn) off the economy, according to renowned economist Bismarck Rewane. In context, the economic loss amounts to around two percent of N128trn recorded as nominal GDP in 2018.
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Nigerians spent over half-a-trillion paying bribes in 2019 according to a survey by the United Nations Office on Drugs and Crime (UNODC) and the Nigerian Bureau of Statistics (NBS) which involved 33,000 households and 33,067 respondents across all states of the country and the FCT
Holding up the Naira and other things: Foreign Reserve ($4.11bn or N1.26trn at 306/$) A country’s foreign exchange reserve is the foreign currencies it holds to support its currency value, maintain liquidity, pay foreign debts, as well as make direct payments, among other things. For a country like Nigeria where official currency value is predetermined at a fixed rate set by the Central Bank of Nigeria (CBN), the apex bank has to tap into its foreign exchange reserve from time to time to maintain that rate. So far in the year (up till December 5), the reserve has fallen by $4.11bn to $39, although the apex bank had a few months back said waning oil price and its intervention in the forex market has been responsible for the decline. It is also important to know Nigeria paid a $200m Guarantee to a UK court where it is fighting to overturn a $9.2bn judgment in favour of a foreign gas company, P&ID. In context, Lagos the decline in the budget is 8 percent more than N1.168trn that Lagos plans to spend next year, which www.businessday.ng
is the biggest state budget in Nigeria. Economic Loss Due to Erratic Power Supply ($25bn or N7.65trn): This is a an estimated loss projected by the Nigerian Power Sector Recovery Programme. The lack of adequate power is costing the national economy to lose significant revenue (estimated loss to GDP in excess of US$ 25 billion) annually. In context, this is 6 percent of the 2018 nominal GDP. Fuel Subsidy (N462.09bn): Subsidizing fuel consumption has cost Nigeria N462.09bn in the first nine months of 2019 according to NNPC data. A projection by BusinessDay shows the amount will cross a half-trillion mark by around N100bn this year. Cheap fuel has been a major bone of contention with proponents of subsidy arguing that already improvised Nigerians would suffer if they paid in full for fuel, while opponents seek for better utilisation of fund. In context, President Buhari in his 2020 budget presentation proposed N48bn for Education and N46bn for Health. Both
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items combined are five times less the amount already spent on fuel subsidy. NNPC refineries loss (N111.27bn): The Nigerian National Petroleum Corporation (NNPC) reported a loss of N111.27bn for three refineries in the nine months to September this year. The loss-making refineries are the Warri refinery, Port Harcourt refinery, and Kaduna refinery. It should be stated that Nigeria relies on foreign sources to refinery its crude oil which is then imported back into the county at a subsidized rate. In context, 111.27bn will pay the minimum wage of 3.7 million workers. Paying Bribes (N675bn): Nigerians spent over half-a-trillion paying bribes in 2019 according to a survey by the United Nations Office on Drugs and Crime (UNODC) and the Nigerian Bureau of Statistics (NBS) which involved 33,000 households and 33,067 respondents across all states of the country and the FCT. In context: If the same amount was shared among Nigerians, everyone would get N3,375.
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Monday 23 December 2019
BUSINESS DAY
Market Wrap-up
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total turnover of 1.381 billion shares worth N15.504 billion in 14,528 deals were traded this week by investors on the floor of the Exchange in contrast to a total of 1.044 billion shares valued at
N14.628 billion that exchanged hands last week in 14,974 deals. The Financial Services industry (measured by volume) led the activity chart with 1.019 billion shares valued at N11.814 billion traded in 8,275 deals; thus con-
tributing 73.82% and 76.20% to the total equity turnover volume and value respectively. The Healthcare industry followed with 170.905 million shares worth N49.097 million in 281 deals. The third place was
Conglomerates industry with a turnover of 83.560 million shares worth N205.786 million in 736 deals. Trading in the Top Three Equities namely, Access Bank Plc, Union Diagnostics and Clinical
Services Plc and Zenith Bank Plc. (measured by volume) accounted for 687.097 million shares worth N6.510 billion in 2,964 deals, contributing 49.76% and 41.99% to the total equity turnover volume and value respectively.
Inflation rises for third straight month in November
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he price of goods and services in November rose for the third-straight month since Nigeria shut its land borders, raising concerns on the
state of local production to plug supply gaps. Headline inflation reached a 19-month high of 11.85 percent in November, the highest since May www.businessday.ng
2018 when the numbers showed up at 11.61 percent in line with analysts’ expectation. However, both food and core inflation moved up to 14.48 per-
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cent and 8.99 percent respectively, according to Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS) on Tuesday. On a monthly basis, @Businessdayng
headline inflation slowed to 1.02 percent. Core inflation measures change in the costs of goods and services excluding food and energy.
Monday 23 December 2019
FT
BUSINESS DAY
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FINANCIAL TIMES
World Business Newspaper RANA FOROOHAR
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arly Fiorina, the former Republican presidential candidate and Hewlett-Packard boss, made news last week when she gave voice to a hypocrisy common in the American business community. She insisted that it was “vital” that President Donald Trump be impeached. Yet she wouldn’t rule out the possibility of voting for him, depending on “who the Democrats put up”. She’s presumably referring to the possibility of an Elizabeth Warren candidacy. I understand why people like Ms Fiorina are allergic to any wealth-distributing progressive. But business people who’ve supported Mr Trump because of cuts to corporate taxes or promises of deregulation are playing a sucker’s game. They are also part of a bigger dysfunctional dance between business and politics that is explored in a new Harvard Business School report on US competitiveness. More accurately, the report focuses on an increasing lack of competitiveness, evidenced by everything from pessimism about America’s medium- to long-term growth prospects, the divide between the fortunes of business and workers, to the country’s declining fiscal position and skills gap. The study, which builds on eight years of research and surveys of thousands of Harvard Business School alumni (who
America’s competitiveness problem A dysfunctional dance between business and politics is at the root of the country’s woes
Donald Trump: ‘[The Democrats] have zero proof of anything, they will never even show up’ © Reuters
represent a healthy proportion of top global executives) cites political dysfunction as the major reason for the decline in US competitiveness. The nation has “squandered” the longest recovery on record by failing to do all the things that people across the political spectrum think it should do — invest in infrastructure, reform education, make it easier for
Pipeline contractor forced to down tools as Berlin accuses Washington of ‘interference’
India’s PM defends police officers and contentious citizenship bill amid clashes
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arendra Modi has cast mass anti-government protests against a planned citizenship bill that has incensed India’s Muslim minority as a law and order issue as the death toll continued to rise. Addressing thousands at a rally on Sunday in New Delhi, Mr Modi blamed the opposition for misleading Muslims and manufacturing “fear psychosis” over contentious citizenship legislation that critics said would give Hindus precedence over religious minorities. He defended the country’s police, who have been criticised after officers deployed water cannon and tear gas to deter demonstrators. At least 15 people have been killed — including an eight-year-old boy — following clashes between protesters and security agents last week. Noting that 33,000 police officers had died protecting the country since independence, Mr Modi said: “Today, you are brutally thrashing them. When any problem arises, police don’t ask your religion or caste, whatever the weather or time they are there to help you.” Mr Modi reverted to familiar nationalistic themes in an appeal to India’s silent majority watching the protests play out in media largely sympathetic to his Hindu
nationalist agenda. He blamed the “urban naxals” — a name for the westernised elite seen as sympathetic to Muslims — and the Congress opposition for spreading “lies” about Muslims potentially being disenfranchised by the new citizenship law. Mr Modi said that there have been no discussions to introduce a national register of citizens, an official record of legal citizens, in contrast with previous remarks made by his home affairs minister that it would be implemented by 2024 and used to throw out “infiltrators”. In support of the citizenship law, which creates a legal loophole for persecuted religious communities from neighbouring countries except Muslims, Mr Modi raised the spectre of “love jihad”, a supposed Muslim conspiracy to seize power in India by seducing Hindu women and converting them to Islam to tip the demographic balance. “Girls are religiously converted and forced to marry in Pakistan. It is well-documented,” Mr Modi claimed. “These people have come to India only due to such religious persecution.” Mr Modi’s remarks come just weeks ahead of assembly elections due to be held in Delhi where the ruling Bharatiya Janata party hopes to oust the Aam Aadmi party (AAP) from power. www.businessday.ng
ingly hard to get elected, even though 41 per cent of Americans identify as moderate, because of a primary system that favours the most ideological voters. The study suggests a number of smart changes to the system, including a “ranked-choice voting” system that would ensure candidates who win actually have the support of the majority of voters.
US envoy defends Nord Stream 2 sanctions as ‘pro-European’
Modi castigates anti-government protesters as death toll rises STEPHANIE FINDLAY
talented immigrants to live and work in the US, and so on. The authors believe that the core reason for this is a lack of competition — in politics. According to them, America can’t get anything done because of a series of changes, beginning in the 1960s, that made the political process hopelessly partisan. Moderates, they argue, find it increas-
But the authors also admit that business itself is another big reason for government gridlock, since it has “funded, perpetuated, and profited” from political dysfunction. Business was part of the diabolical process of gerrymandering that has led to the partisan redrawing of voting districts. Spending on political lobbying in the US is now estimated to reach $6bn per election cycle (with Big Tech, the US Chamber of Commerce and the National Association of Realtors leading the way). All that money gushing into politics is, of course, one reason that we end up with financial reform bills and tax rules that few people are happy with — because individual industries and companies carve out exemptions and loopholes in legislation. Yet business stubbornly refuses to accept that it is part of the problem. Survey results show that most business leaders believe that corporations influence politics in ways that erode not only democracy but the competitiveness of the economy as a whole. But most deny that their own companies are at fault. Only 25 per cent of HBS alumni surveyed believe their own companies are involved in lobbying. A mere 8 per cent believe that their own firms have sought to hire former government officials.
GUY CHAZAN
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he US ambassador to Berlin has defended US sanctions against the Nord Stream 2 pipeline designed to supply the EU with Russian gas as “extremely pro-European”, but Berlin condemned the legislation as “interference” in its internal affairs and Moscow threatened to “respond.” Richard Grenell was speaking as Allseas, the Swiss company that is Nord Stream’s main contractor, said it had suspended work on laying the pipeline. A vocal champion of Donald Trump’s policies, Mr Grenell said: “There are 15 countries, plus the European Commission, plus the European Parliament, that have all voiced concern about the project.” He said he had been “hearing from European diplomats all day today thanking me for taking such action”, adding that the sanctions, which were signed into law by Mr Trump on Friday, were “an extremely pro-European position”. The US was “very pleased” that Allseas had decided to comply with the sanctions, he added. Nord Stream 2 is a €9.5bn pipeline that would bring natural gas directly from Russia to Germany via the Baltic Sea. Mr Trump has frequently spoken out against the project, saying it would increase Germany’s reliance on Russian gas and so turn Europe’s largest economy into a “captive” of Russia. The punitive measures threat-
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en a further deterioration in relations between Berlin and Washington, already damaged by Mr Trump’s constant attacks on Germany’s trade surplus and its failure to meet Nato targets on defence spending. German finance minister Olaf Scholz described the legislation as “serious interference in Germany and Europe’s internal affairs and our own sovereignty”. “We object to them in the strongest terms,” he told the German TV channel ARD. Such measures were “incomprehensible and improper for friends that are also linked by our common membership of Nato”, he added. Russian foreign minister Sergei Lavrov on Sunday warned that Russia would respond to the measures with steps that would not also harm the Russian economy, without elaborating. Mr Grenell insisted that Mr Trump was merely pursuing a longstanding US goal, noting that the Obama administration had also been opposed to Nord Stream 2. “The US policy is for European diversification and making sure that there are multiple sources [of energy],” he said. Washington wanted to prevent a situation arising where “one country or source has the ability to create undue leverage over Europe.” Critics have said the line will allow Gazprom, Russia’s Kremlincontrolled gas export monopoly, to bypass Ukraine, potentially @Businessdayng
depriving Kyiv of billions of dollars in transit fees, and weakening the country in its long-running military and political confrontation with Russia. However, that risk receded last week after Moscow and Kyiv concluded a landmark agreement that would ensure Russian gas continues to transit through Ukraine even after Nord Stream 2 is completed. Germany played a critical role in brokering the agreement and pressuring Russia to maintain Ukraine’s transit status. The US sanctions, part of the National Defense Authorization Act for 2020, mandate Mr Trump to punish companies involved in providing “vessels for the installation of deep-sea pipeline for the Nord Stream 2 project”. US senators Ted Cruz and Ron Johnson, two architects of the sanctions, had earlier written to Allseas chief executive Edward Heerema calling for an immediate halt to its work. “We understand that Russia is paying Allseas a very substantial amount of money to complete the Nord Stream 2 pipeline,” they wrote. But they warned that continuing the work “for even a single day” would expose the contractor to “crushing and potentially fatal legal and economic sanctions”. Mr Lavrov on Sunday vowed that the pipeline - and a similar project to pipe gas to Turkey also affected by the sanctions - would be launched regardless of the US decision.
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Monday 23 December 2019
BUSINESS DAY
FT
NATIONAL NEWS
Political life shows managers need a stable team One presidential candidate is making a case for leaders to nurture talented staffers PILITA CLARK
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uesday December 10 was an eventful day for Donald Trump, even by the US president’s own hectic standards. It began with the unveiling of impeachment charges accusing him of grave misdeeds and ended with a campaign rally in Pennsylvania where he called FBI agents “scum”; described one prominent Democrat as a “crooked bastard” and claimed another top Democrat’s marriage was a “phoney, disgusting” sham. On the other side of the Atlantic the same day, one of the Democrats hoping to unseat Mr Trump in next year’s presidential election gave a calmer speech at the UN climate talks in Madrid. “I am here because no one from the White House is here,” said Michael Bloomberg, the New York billionaire and climate campaigner. Away from the stage in Spain, Mr Bloomberg met a small group of journalists who received a heavy dose of another campaign message. It had nothing to do with impeachment, outlandish behaviour or any other Trumpish trademark. It was simply this: Mr Bloomberg would be a better manager than Mr Trump. As political mantras go, it is hard to see this one gripping voters coast to US coast. “It’s the management, stupid,” does not brim with bumper sticker promise. That is a shame. White House occupants clearly need a lot of skills but at a basic level, as Mr Bloomberg put it, “the president’s job is a management job”. His financial media group employs about 20,000 people and New York City had 300,000 employees when he was its mayor, he said. Experts have estimated that no more than 4,000 people work for Mr Trump’s real estate empire worldwide and in any case, said Mr Bloomberg, that type of business offers thinner management experience because “you deal with a customer once, you sell them a building and then you don’t go back”. In fact, you might if you have been in real estate for as long as Mr Trump. But Mr Bloomberg made a convincing, and refreshing, case when asked what he would do in his first 100 days if elected. “Build a team,” he said. He had faced pressure to
make a splash in the first 100 days of his three terms as New York’s mayor, but the dull truth was he was busy building a team. “It takes a long time to do big things,” he said. One reason for his mayoral successes was a relatively stable team of experienced staffers with ideas, who could attract talented people to work for them and ultimately effect change. “You can’t do anything, I don’t care how smart you are, if you don’t have [the] people,” he said. “And you can’t have turnover all the time.” How true. Mr Trump’s administration has of course been notable for a relentless change in personnel. As of last week, 80 per cent of the top 65 White House jobs had turned over since Mr Trump took office, says Kathryn Dunn Tenpas of the Brookings Institution, adding a rate of turnover that high was “off the charts”. Staff turnover may not be the most important feature of Mr Trump’s tenure and Mr Bloomberg has yet to prove he can secure the Democratic nomination, no matter how impressive his managerial background. So what of the broader argument that a business leader makes a better — or even a very different — politician? Voters clearly think they do. More than 80 per cent of Americans thought the US would be better governed if more people with business and management experience were in political office, one Gallup poll found. Though that was in 2014, before anyone had experienced the Trump presidency. More recent research suggests voters may be mistaken. At least two studies in the last three years have looked at the performance of city government politicians with a business background. One in California found no evidence that electing a business candidate to a city council affected spending, revenues or unemployment rates. That echoes the early findings of research on Brazilian mayors that suggested business people were no better at reducing fiscal deficits, investing in health or getting money from the federal government. Still, there are business people and business people. And if three years of the Trump presidency has taught us anything, it is that some are entirely different to all others.
Emmanuel Macron, left, meets his Ivorian counterpart Alassane Ouattara in Abidjan on Saturday © AFP via Getty Images
France loosens supervision of ‘colonial’ west African currency CFA franc countries will no longer keep half their reserves in Paris
DAVID KEOHANE AND DAVID PILLING
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rance has bowed to popular pressure in west Africa by agreeing to scrap the name of the CFA franc and loosen its supervision of the currency union as Paris seeks to reshape relations with its former African colonies. Established in 1945, the CFA franc has been used in two African monetary zones, one for eight west African countries and the other for six mostly petro-states in central Africa. Critics say the currency is a “colonial relic” that preserves the dominance of Paris and French companies in the region by removing French currency risk at the cost of monetary and fiscal independence. The monetary revamp, which will initially only be implemented in the west African monetary area, was announced on Saturday during a visit by Emmanuel Macron to the Ivory Coast, where the French president also said that colonialism had been “a profound mistake”. Mr Macron has said he wants to dismantle the “Francafrique” sphere of influence with former African colonies in favour of more normal, business-oriented relations free of any colonial taint. He has also sought to encourage French business interests in non-francophone states such as Nigeria and Ethiopia. “The question of the CFA franc crystallises numerous debates and criticisms of the supposed role of
France in Africa,” Mr Macron said in Abidjan, Ivory Coast’s economic hub. The French president said he welcomed the launch of the “Eco”, which will replace the CFA franc in west Africa in 2020. “I see your youth criticise us in a way for continuing an economic and monetary relation that they judge to be, and I quote them, postcolonial.” Ivorian president Alassane Ouattara said it was an “historic day for west Africa”. “The CFA franc is dead,” French newspaper Le Journal du Dimanche declared. Since 1999, the CFA franc has been pegged to the euro and members have had to keep half of their foreign reserves in France. A French official has sat on the board of the regional central bank in both zones. Announcing the new arrangement on Saturday, Mr Macron said the renamed eco would still be pegged to the euro and guaranteed by France. However, countries using the currency will no longer have to keep half of their reserves at the French treasury, nor will there be a French representative on the currency union’s board. Further details have not been disclosed. “France is leaving the governance of the whole system in west Africa,” said a senior French official. “It’s a significant move as through our presence in institutions we had an influence on the decisions taken by the currency union.” Supporters of the currency, including Mr Ouattara himself, have
argued that it has provided stability even in times of severe political stress such as during two civil wars in Ivory Coast, the latter from 201011. French finance minister Bruno Le Maire said “a good balance” had been found in the new regime: “The zone keeps the exchange rate fixed with the euro . . . guaranteeing currency stability and protection against inflation.” Opponents of the currency say it prevents countries from devaluing to counter external shocks and has hampered industrialisation by keeping the exchange rate artificially high. Some regard it as a useful arrangement — to the detriment of the poor — between France and the moneyed elites of francophone Africa, whose spending power is inflated. The obligation for member states to keep half their reserves at France’s central bank has been a particularly sore point. The renaming of the currency is symbolic: CFA originally stood for Colonies Françaises d’Afrique, or French Colonies in Africa. The eight countries in the west African region had already intended to rename the currency as the eco and have long discussed a single west African currency that could eventually include other anglophone states, such as Nigeria and Ghana. The six countries using the central African CFA are expected to decide how they wish to proceed next year, French officials said.
Xinjiang security crackdown sparks Han Chinese exodus Locals estimate that Korla’s population has halved since internment of Uighur Muslims YUAN YANG
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eijing’s crackdown in Xinjiang is driving hundreds of thousands of businesspeople and workers to abandon Korla, crippling the economy of the region’s second-largest city. In multiple interviews with the Financial Times, Korla businesspeople estimated that the city’s population has halved from about 500,000 after the government implemented harsh security measures over the past
few years. The residents most able to leave voluntarily are migrant businesspeople from China’s dominant Han ethnic majority — the very people the Communist party had attracted to Xinjiang in the hope that they would “civilise” the region’s Turkic Uighur Muslim population and build the local economy. “It’s difficult to find labourers now and there’s no money to be earned,” said a stall keeper at Korla’s agricultural market, who had a “help wanted” sign on her stall.
“The people have all left.” None of those interviewed in Korla wished to be named for fear of government reprisals. Korla has historically been a frontier of the Han Chinese influx into Xinjiang with PetroChina, the country’s largest petroleum company, developing one of its biggest oilfields in the area. The city became “a showpiece for tourists and prospective migrants of how good life can be on the frontier”, said Tom Cliff, author of Oil and Water: Being Han in Xinjiang. “Han population decline
shows that life is no longer good on the frontier, even for the relatively privileged settlers,” said Mr Cliff. In 2016, Chen Quanguo, Xinjiang’s new party secretary, introduced security measures affecting all ethnicities in the region, from police checkpoints and street surveillance cameras to identity checks and bag scans at shopping malls and parks. At the same time, the government has detained about 1.8m Muslims, turning many urban areas into ghost towns.
The economy has suffered as a result. Xinjiang’s official figures show that fixed-asset investment dropped 36 per cent in the two years since 2016 in Bayingolin prefecture, which includes Korla, although it picked up slightly in 2019. Estimating the real population of cities in China is difficult because official figures usually track people with local household registrations or hukou. Such figures ignore the vast floating population of workers and businesspeople.
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Monday 23 December 2019
BUSINESS DAY
FINANCIAL TIMES
COMPANIES & MARKETS
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Argentina delays payments on $9bn in dollar-denominated debt New government asks bondholders to show ‘good faith’ amid wider restructuring talks DANIEL SCHWEIMLER AND COLBY SMITH
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rgentina has delayed payment on roughly $9bn in dollardenominated debt for the second time in five months, pushing off payment until August 31 while calling on bondholders to show “good faith” in talks to restructure the country’s massive debt pile. The government was due to repay $67m on Friday and an additional $280m on Monday for the local notes, known as Letes, according to local newspaper Clarin. These short-term bonds are sold by the country’s Treasury to individuals and companies. Private individuals and the Argentine provinces will be exempt from the postponement. “It basically kicks the can down the road,” said Alejo Costa, a strategist at BTG Pactual in Buenos Aires. “The payment for August will just be too massive so we know they have to do something before it arrives.” Fitch, the rating agency, downgraded Argentina “restricted default” after the plan was unveiled on Friday, noting that it deemed the maturity extension “a distressed debt exchange”. Another rating agency, Standard & Poor’s, followed suit shortly after, downgrading the country to “selective default”. The last payment delay was announced by the previous government of Mauricio Macri, shortly after a primary vote result that signalled he would lose his bid for re-election in October’s national election, which sent the peso reeling and increased the cost of insuring against a debt
default. The announcement came as little surprise to investors, given Argentina’s record on debt repayment and the central bank’s dwindling stock of foreign reserves, used in the battle to control high inflation and a weak currency. “More than anything else, it’s a reality check,” said Walter Stoeppelwerth, the chief investment officer at Portfolio Personal Inversiones. “It’s a recognition that no way, no how do they have the dollars to pay the Letes now.” The latest move is part of a wider strategy by Argentina’s new president, Alberto Fernández, who took office earlier this month, to restructure a large part of Argentina’s estimated debt load of $332bn. This included loans from the IMF, which extended a $57bn bailout programme to the country last year, the biggest in the institution’s history. The official government bulletin announcing the new measures said a significant percentage of Argentina’s debt was in foreign currencies, principally the US dollar. A government spokesman said since the dollar was not Argentina’s currency, the dollar debt presented different problems and therefore had to be treated differently in terms of repayment. Earlier on Friday, the lower house of Argentina’s Congress approved an emergency economic bill, known as the Social Solidarity and Production Reactivation plan, which includes an array of tax increases on grain exports, personal property and foreign assets held abroad.
Crunch time for Aim after another bruising year Market needs to innovate to stop decline becoming terminal KATE BURGESS
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n Christmas Eve, shares in Aim-quoted Stirling Industries will be cancelled. It will be a swift and crushing end to a shortlived acquisition vehicle floated in 2018. It will also close a bruising year for London’s Alternative Investment Market. Stirling is being liquidated, having failed to raise the money it needed to buy Ipsen, a German steel-hardening business, from public or private equity investors. An illustration of the reluctance of investment institutions to back small companies, it marks a moment for Aim, which celebrates its 25th birthday next year. The number of companies on London’s junior market has almost halved since 2007. Then, Aim boasted a line-up of more than 1,600, now it has about 870. In fact, more companies quit Aim in 2018 — about 80 against almost 60 in 2019. But 65 companies joined the market last year. This year, new entrants won’t top 17. And little new money has been raised — only about £380m. That is more than small-caps raised elsewhere in the EU, but compares with £1,563m last year. One of 2019’s noisiest exits from Aim was by Goals Soccer Centres, the five-a-side group once backed
by sporting entrepreneur Mike Ashley that uncovered accounting irregularities and unpaid VAT of more than £13m. It was delisted in September and sold via administration in November. GSC is one of Aim’s many miscounting sagas, ranging from Utilitywise to Eddie Stobart Logistics, which does nothing for Aim’s reputation as a Wild West market populated by cowboys and hustlers. Eddie Stobart found untold mathematical blunders in its accounts, suspended its shares in August and sold its operating businesses. It will be hard to hang on to its Aim quote much longer. Stirling Industries blamed geopolitical collywobbles for its demise. Other companies have variously denounced the high costs of maintaining a public market quote, regulation, corporate governance strictures and what brokers call dequitisation, the general reduction of share markets. Tax breaks on debt and low inflation are driving investors away from shares and towards bonds. At the same time, companies can raise money privately more easily without recourse to public markets. The worst defection for Aim may have been that of Shore Capital, the small company broker and Aim adviser, which deemed its listing expensive and pointless. www.businessday.ng
How asset managers turned into business agitators
A change of heart about investing that looks beyond profits seems to have taken hold ATTRACTA MOONEY
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or decades, fund managers making investment decisions have focused on financial performance to the exclusion of almost everything else. In the good times they reaped sizeable dividends from the likes of oil and tobacco companies, with little concern about the potential long-term impacts of the businesses they financed. But a change of heart about investing that looks beyond cold hard profits has taken hold to such an extent this year that Anne Richards, the boss of fund management behemoth Fidelity International, told a room full of 200 financial executives in November that the industry had to change. “We as investors . . . must adapt to the realities of today. To slow this rapid destruction of our shared home, we will need to rethink the very purpose of our economic systems,” she said. “The pressure is coming from all around. It’s hard to find voices that defend ‘business as usual’ and actually even capitalism as a concept.” Asset agitators Although there was always a small band of fund managers who were interested in whether the businesses they bought shares in were part of the “doing good while doing well” category, many of the big names have now tuned into these questions too in response to pressure from politicians, the public and, most of all, their clients. Pension funds, which are by far the biggest clients of asset managers, are increasingly asking them tough questions about the businesses where they have shareholdings. In the UK, new rules were introduced in October this year that in effect require pension funds to consider ESG — environmental, social and governance — questions in their investment decisions. Because of this pressure from clients, asset managers in turn have become the main agitators for businesses to change their ways in recent years, pushing chief executives for reform on everything from high pay to environmental disclosures.
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“The investor voice has been key” to changes, particularly on questions of sustainability, said Tim Smith, director of ESG shareholder engagement at Walden Asset Management. A graphic with no description Andreas Utermann, chief executive of Allianz Global Investors, the €557bn asset management business of German insurer Allianz, said: “Clients have changed their tune. They have said we need to take this more seriously and that has sharpened the minds of the asset managers.” The changing priorities of younger age groups is also driving the change in focus. According to data from research company Cerulli Associates, more than two-thirds of investors under 30 would prefer their investments to have a positive social or environmental impact. With rising demand from clients, asset managers have spent the year pouring money into hiring staff and upgrading their technology systems in a bid to gain an edge in ethical investing. They have also done more to make their views known to company boards and are more willing than ever to use their votes at annual meetings to signal disapproval. At the same time, a number of investor groups have sprung up, with the aim of improving standards in areas like workers’ rights and environmental disclosure. High pay and other pressure points What all of this means is that listed businesses face shareholder scrutiny like never before and so far the biggest battles have been about pay. There were shareholder revolts against pay at 33 of the UK’s 350 biggest listed companies this year, up from 22 in 2014. At the same time, average shareholder support for executive pay packages at UKlisted medium and large public companies has come down every year since 2014, according to data provider Proxy Insight. A number of top executives at British banks have also been forced to accept cuts to their pension payments to bring them more in line with their wider workforce, after @Businessdayng
pressure from shareholders. A graphic with no description A similar trend has played out across the S&P 500 in the US, with shareholder revolts over pay rising from 46 to 61 since 2014. Investors have also been more involved this year in putting pressure on fossil fuel companies such as BP to improve their environmental disclosures. “The financial markets are becoming a powerful force in the drive towards sustainability,” said Anne Simpson, investment director at Calpers, the US’s largest public pension fund. “The reason is simple. The long-term drivers of risk and return ride on companies’ ability to manage their human capital, their physical resources. It is not enough simply to deploy finance with flair.” Ms Simpson said employee and human rights had also moved up the agenda. Calpers is a founder of the Human Capital Management Coalition, which put pressure on fast-food and retail companies to tackle low pay this year. Companies including McDonald’s and Target raised wages in response. In the US, a human rights resolution also won the backing of a majority of shareholders for the first time ever, according to Proxy Insight. Just over half of shareholders at Microchip Technology’s annual meeting in August supported a motion calling for a report on human rights risks to employees in the company and across its supply chain. There are also signs that investors are becoming more willing to dump companies with bad ESG records. Union Investment, Germany’s third-largest asset manager, sold its bonds and shares in mining company Vale after a dam collapse in Brazil that killed 272 people in January, as did the Church of England’s Pensions Board. Elsewhere, Norway’s $1tn oil fund, the world’s largest sovereign wealth fund, sold out of security company G4S this year on ethical grounds, after it said it found that the company’s migrant workers in the Middle East were being harassed, had their passports confiscated and were being paid lower wages than agreed.
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Monday 23 December 2019
BUSINESS DAY
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ANALYSIS
Anglo seeks to ease investor fears over fossil fuel lobby groups Miner agrees commitments that will align it more closely with Paris climate accord NEIL HUME
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nglo American, one of the world’s biggest miners, has moved to head off a clash with shareholders over membership of powerful advocacy groups that engage in lobbying for the fossil fuel industry. Following discussions with institutional investors, the London-listed group has signed up to a number of commitments that will more clearly align its lobbying activity with the Paris agreement on climate change. These include a pledge to publish industry association memberships — including fees and its rationale for joining — by its annual meeting in May. It will also set out a process to tackle “misalignments” in policy positions. In a previous audit of lobby groups, Anglo identified policy differences with organisations including the World Coal Association, the Minerals Council of Australia (MCA), the Hydrogen Council and the Northwest Territories Chamber of Mines. Anglo American owns coal mines in South Africa and Colombia producing thermal coal, which is burnt in power stations. It also a
major supplier of coking coal, used in blast furnaces to make steel. Its Australian coming coal mines have been among its most profitable assets in recent years. Its chief executive Mark Cutifani has said the company is looking at a pathway to retire or dispose of its thermal coal assets. Anglo American is targeting a 30 per cent reduction in its carbon emissions by 2030, a goal it has linked to the long-term bonus plans of its senior executives. Stephanie Pfeifer, chief executive of the Institutional Investors Group on Climate Change, which is backed by funds with more than $4.7tn under management, welcomed Anglo’s move on lobbying but said the company must follow through “by meaningfully putting its commitment into practice”. “Trade bodies must be called to account where they are opposing, impeding or evading the policy required to support decarbonisation and reduce global emissions,” she said. Membership of industry groups that engage in obstructive lobbying for the fossil fuel industry has become a flashpoint between investors and natural resources companies. This is especially the case in Australia, where groups such as the MCA are highly influential.
Fear of Russian attack hangs over Chechens in Germany Diplomatic spat after dissident’s death raises stakes for exiles GUY CHAZAN
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hen news broke last August that a former Chechen rebel had been gunned down in broad daylight in Berlin, Mukhamad Abdurakhmanov feared he would be next. “I felt that Germany just isn’t safe any more for people like me,” he said. Mr Abdurakhmanov is one of thousands of Chechens who have left their homeland in the Northern Caucasus, fleeing the increasingly brutal regime of Chechen strongman Ramzan Kadyrov. Many thought they had escaped Mr Kadyrov’s clutches for good and found a safe haven in Europe. The murder of Zelimkhan Khangoshvili, a Georgian national of Chechen ethnicity, shattered that hope. Chechens living abroad — especially former guerrillas who battled Russian troops during Chechnya’s wars of independence — have long been in the Kremlin’s crosshairs. But Khangoshvili’s murder was something new — a brazen attack in a busy Berlin park that seemed calculated to strike terror into the Chechen community. “It was an attempt to intimidate all Chechens living in exile,” said Frank Schwabe, a German MP who is the Council of Europe’s rapporteur on human rights in the North Caucasus. “They wanted to send the message that ‘we will get all of you, even if you live abroad’.” The case has tipped Germany and Russia into a diplomatic crisis. This month German federal prosecutors said they suspected Russian or Chechen involvement in the murder. Berlin expelled two employees of the Russian embassy over Moscow’s failure to co-operate in the investigation and Moscow has declared two Ger-
man diplomats persona non grata. Russia denied any involvement in the Khangoshvili affair, but President Vladimir Putin said the victim was a “cruel and bloodthirsty person” who was “one of the organisers of explosions in the Moscow metro”. The death of Khangoshvili came at a time of growing alarm at the Kremlin’s campaign of violence against its enemies abroad. The most famous casualties have been Russian — Sergei Skripal and his daughter Yulia, who narrowly survived a brush with the novichok nerve agent in Salisbury, England, last year, and Alexander Litvinenko, the dissident who died of polonium poisoning in London in 2006. But Chechens are also being targeted. Umar Israilov, for example, a former bodyguard of Mr Kadyrov who became a fierce critic of his regime, was shot and killed in Vienna in 2009. Mansur Sadulaev, an opposition activist who has lived in exile since 2012, received so many death threats while seeking asylum in Austria that he was put under 24hour police protection. The head of Vayfond, an aid organisation for Chechen exiles, Mr Sadulaev served two years in jail for fighting against the Russians in the 2000s. But he fled abroad upon his release after unidentified gunmen began dropping by his home unannounced. “If you’re already on their radar screen it’s only a question of time before they kill you or lock you up,” he said. Though never a fighter, Mukhamad Abdurakhmanov, whose brother Tumsu is a well-known blogger and Kadyrov critic, has also experienced threats to his life. “In Chechnya there is collective responsibility — a brother answers for his brother,” he said. www.businessday.ng
UK election: how the Tories ‘got it done’ Brutal discipline and a potent slogan brought victory for Boris Johnson — but can he now meet the challenges of government? SEBASTIAN PAYNE
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he UK election was won on a Tuesday evening in September in the back room of a drab hotel in Bury. The Conservatives were conducting one of their regular focus groups with voters in the northern English town. Aware that an election was around the corner, party strategists knew that Boris Johnson needed a simple slogan to explain his core policy of delivering Brexit. In the end, the key phrase materialised from a conversation among half a dozen people in the hotel. “Voters were chatting about Brexit and there was a [group] of about four to five people who started talking about ‘getting it done’,” one strategist in the room recalls. “That was all they wanted: to get Brexit out of the way, out of their lives. ‘Get Brexit Done’ emerged from that meeting. It was trailed at the party conference and went on to define the campaign.” That three-word slogan — a sequel to the Vote Leave campaign’s pledge to “Take Back Control” in the 2016 referendum — proved to be one of the most potent political messages of modern times. With mind-numbing repetition from the prime minister, ministers and hundreds of Tory candidates across the country, it helped hand the party its biggest victory in three decades and delivered Mr Johnson a “stonking” mandate to reshape the nation. The extent of the campaign’s success is reflected in the widespread perception that Mr Johnson is now the head of a brand new government, rather than the leader of a party which has been in power for nine years and whose austerity policies were loathed in precisely the same areas of the country where the Tory party triumphed on December 12. The Conservative victory mirrored the approach behind the slogan: careful planning and brutal discipline, driven by what voters told them. Whereas the party’s previous campaign two years ago cost former prime minister Theresa May her majority and veered from mishap to disaster, Mr Johnson’s team based their message and tactics on the data-driven Vote Leave referendum campaign. It may be a truism of both war and elections that the victors get to write the history, but for the team behind the Conservative campaign, the key moment was when they were able to define the political debate in a simple message about Brexit. “We had essentially won before the campaign began,” says one insider. Or as James Cleverly, the
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party chairman, argues, the Tories succeeded where Jeremy Corbyn, the opposition Labour party leader, failed because of the conversations it held in Labour’s traditional heartlands, including towns such as Bury in Greater Manchester. “Labour lost because they had given up listening to people.” Mr Johnson won the election with an effective message, but good campaigning does not always lead to good government. Vote Leave won the 2016 referendum but almost lost the battle to deliver it. Now the prime minister faces the challenge of turning his key message into reality, including complex and difficult trade talks with the EU. Although the Conservatives attempted to channel the energy and skills of the Vote Leave campaign, the team was not actually led by Dominic Cummings, Mr Johnson’s most influential adviser and the architect of the “Take Back Control” message. Instead, the leading figure was Isaac Levido: a 36-year-old protégé of veteran Tory electioneer Lynton Crosby, who played a key role in Scott Morrison’s surprise victory in this year’s Australian federal elections. Mr Levido was hired at a meeting in the Marylebone branch of Patisserie Valerie in July, having been approached by Mr Cummings the day Mr Johnson entered Downing Street. He agreed with one proviso. “Isaac told Dom he would do it only if he had complete control. Dom agreed and completely stepped back,” says one friend of the pair. At the heart of the Tory war room with Mr Levido sat his long-time work partner Michael Brooks, who supervised focus groups and polling. He ran nightly surveys, held continuous meetings with voters to test messages and the mood. “Brooksy and Isaac worked seamlessly, they were the core of the campaign,” according to one official. Lee Cain, who has worked with Mr Johnson since the referendum, moved across from Downing Street to lead the media operation. Along with Paul Stephenson, another veteran of the Vote Leave campaign, the party’s media operation was focused on broadcast outlets and rapid rebuttal. One official summed up their approach: “It was Brexit, Brexit, Brexit, that focus was drilled into us. Isaac brought calm leadership, Lee and Paul brought the fighting Vote Leave spirit of 2016 into 2019.” As the nascent campaign geared up, the Conservative party was in crisis, having spent three years failing to get Brexit done, with parliament voting down the withdrawal agreement multiple times. Nigel Farage’s Brexit party emerged to beat the Tories in the May European elections @Businessdayng
— creating a schism in the Leave vote. Meanwhile, the pro-Remain Liberal Democrats surged and almost doubled their share of the vote. The country’s oldest political party turned to Mr Johnson as their hope for salvation. From his initial days in Downing Street in late July, Mr Johnson focused on trying to reunite the Brexit vote. But the prime minister was elected to the leadership of his party on a platform of leaving the EU on October 31 “come what may, do or die”. He ended up breaking that pledge as opposition MPs passed legislation to force another delay. While ministers were concerned that the party’s reputation would suffer, the campaign team worked to “inoculate” the prime minister from the fallout. Mr Johnson acted ruthlessly, sacking 21 MPs from his party, including former chancellors Ken Clarke and Philip Hammond, and used the term “Surrender Act” to describe the legislation passed by MPs to delay Brexit until January 31. He was criticised in Westminster, but Downing Street officials said it was necessary for the election campaign. “Boris had to be seen to do everything to get Brexit through. When the October 31 cliff-edge arrived, it had to be very clear to voters that he had done everything humanly possible, almost bar going to prison, to get us out of the EU.” Several officials said one “absolutely crucial” moment came in midOctober, when Mr Johnson reworked Mrs May’s withdrawal agreement, replacing the contentious “backstop” insurance policy with special arrangements for Northern Ireland. The new deal won back defectors to the other parties. “Once Boris had the deal, it meant the Lib Dems could trust us not to wreck the economy and the Brexit party supporters knew we were serious about leaving the EU,” says one senior Conservative. When parliament dissolved on October 31, the campaign slogans and strategy were tested and proven to connect with voters: “get Brexit done”, end the parliamentary chaos and allow for extra cash into the police and health service. “Don’t underestimate how much was done before the election was called,” says one insider. For all the sound and fury of a five-week election campaign, little changed in the race as Conservatives hammered out their core message and Labour attempted to make up ground with its radical policy platform. The Tories began roughly where they ended: 10 points ahead of Labour and more trusted on leadership and the economy — the two crucial ratings Mr Brooks tracked diligently.
Monday 23 December 2019
BUSINESS DAY
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abujacitybusiness Comprehensive coverage of Nation’s capital
FCT COE begins degree programmes 2020 James Kwen, Abuja
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L-R: Jegede Olajide, MD/CEO, ABUCOOP Microfinance Bank Limited; Abubakar Sadiq Suleiman, board director, ABUCOOP/president, NNPC Cooperative; Micheal Arokodare, chairman, board of directors, ABUCOOP, and Kayode Odumosu, company secretary, at the 2018 annual general meeting of the bank in Abuja.
Ease of doing business: FCTA to harmonize overlapping laws James Kwen, Abuja
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he Minister of Federal Capital Territory (FCT), Muhammad Bello has said that the FCT Administration is working towards harmonizing overlapping laws and regulations within the various Secretariats, Departments and Agencies (SDAs) that were militating against the ease of doing business processes in the FCT. Bello who disclosed this at the FCT Technical Workshop and Engagement Forum on Ease of Doing Business in Abuja said improving the ease of doing business was at the
root of Nigeria’s recovery and growth plan of the current administration with a significant progress already recorded in the last four years. He explained that Abuja, being the mirror of the country must therefore, be a model in the ease of doing business agenda of the Administration that should be emulated. Bello also expressed the desire for a small working group involving key agencies within the FCTA and the Area Council Chairmen to resolve issues raised at the workshop, stressing that all businesses and services ultimately, are domiciled in the Area Councils.
He stressed the need to institutionalize the ease of doing business initiative as that was the only way the reforms will take root and flourish, adding that with continuous work on improving steps, over a period of time, the reforms can be sustained and institutionalized. Earlier, in her presentation, Special Adviser to the President on Ease of Doing Business, Jumoke Oduwole said the Ease of Doing Business initiative correlated with the priorities of the Federal Government because it is linked with security, the economy and the anticorruption crusade of the government. She said the ease of
Aliyu assures residents of speedy completion of N19bn Karshi water project James Kwen, Abuja
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he Federal Capital Territory (FCT) Minister of State, Ramatu Tijjani -Aliyu has assured residents of the Federal Capital Territory that the N19 billion Karshi water project will be completed on record time to address the challenges of water supply in the satellite towns. Aliyu who gave the assurance while on tour of facilities in Abuja Municipal Area Council (AMAC) of the Territory, also revealed that the project has advanced to 45 percent completion. The Minister, accompa-
nied by the Director of Satellite Towns Development Department, STDD, Felix Nwankwo and other Directors of various Agencies and Departments during the tour expressed satisfaction with the level of work done and assured the contractor that the administration will pay the certificate generated. “I am happy with the level of work done and I can assure you that the administration will ensure the speedy completion of the water project aim at addressing water challenges faced by residents of satellite towns. “It is an ongoing project www.businessday.ng
and based on presidential directive, we have a duty to make sure that we continue with projects already started. That is why we are trying our best to develop all the necessary budgetary provision National Assembly has already signed. We are trying to complete the project as soon as possible,” Aliyu stated. The Minister said the FCT Administrationwasdetermined to ensure that both the Satellite Towns and most of the new Districts will have water, stressing that the construction of Coffer Dam in Karshi will ease the supply of water to other Satellite Towns when completed.
doing business intervention is intended to change people’s perception that it is difficult to do business in Nigeria and to remove bureaucratic bottlenecks so that businesses can thrive, noting that, this is being done through reduction in the cost and the time it takes to do business. “There is need for collaborations. We need to break down the silos. When organizations come together to work, there are chances for greater success. But there is also need for patience. The decay did not happen overnight and will take time to resolve. Time to build strong collaborations and institutions”, she said.
he Acting Secretary and Director, Finance and Account of the Federation Capital Territory Administration (FCTA) Education Secretariat, Umar Marafa has disclosed that the FCT College of Education, Zuba would commence degree programmes in the 2020 academic session. Marafa who made this disclosure at a press conference in Abuja said the National Universities Commission (NUC) has given approval for the degree programmes to be run by the College. He said in order to ensure a smooth take-off of the degree programmes, 31 academic staff have been sponsored, through Tertiary Education Trust Fund (TETFUND) for various postgraduate programmes leading to award of Masters and Doctorates degrees. The Acting Secretary said
the College of Education recently hosted National and International conference and workshops in various disciplines to improve academic capacities of staff Marafa stressed the commitment of the Secretariat to maintaining robust collaboration with various local and international partners through its open door policy so as to improve the standard of education in the FCT. He also assured that the Secretariat would continue to respond to the educational needs of people living with disabilities via an all-inclusive education, in line with the UN Convention on peoples with disabilities. Marafa further assured FCT residents of quality education service delivery to learners with special needs as well as increased support to parents through the distribution of Assistive Technological, and support devices to FCT Special Needs Schools.
Mayfield Specialist Hospital focuses on affordable healthcare, prioritises service Harrison Edeh, Abuja
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ayfield Specialist Hospital, Suncity Abuja (MSH) -a 250-bedded multi-specialist hospital established to provide a complete range of outpatient and inpatient diagnostic and treatment services is focused on growing customer satisfaction with appreciable a service delivery. The Hospital Management at a recent launch in Abuja said it is focused on providing treatment in all different specialties including General and advanced Laparoscopic Surgery, Critical Care, Neurosciences, Orthopedics, Polytrauma, Joint Replacement and Sports Medicine, Gastro sciences, ENT, Obstetrics and
Gynaecology among others. According to the Management, the Hospital was built as an institution which matches the highest standards of healthcare delivery across the world. Where care is provided to patients at an affordable cost. The Hospital management promises to continue to provide and extend further the best international standards quality care universally to every man, woman and child in Nigeria be they rich or poor. This state of the art hospital is equipped with all modern world-class equipments and facilities, featuring multi-specialty and super-specialty departments, Mayfield specialist Hospital provide premier healthcare to all.
Nigerian basic schools records gross infrastructural, personnel deficit Godsgift Onyedinefu, Abuja
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t least than 10,193,918 million eligible Nigerian children are currently out of school, and as many as 13 million more might still lack access to primary education, amid gross infrastructural and personnel deficit, the 2018 National Personnel Audit (NPA) report recently launchedbypresidentMuhammadu Buhari has revealed. The Universal Basic Education Commission (UBEC) in April, 2018 flagged-off a comprehensive audit of all basic educational institutions in the country to obtain a robust data that can meet the planning needs of the education sector.
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The report noted that Nigeria’s capacity to provide access to basic education was still low as evident in the low primary Gross Enrolment Ratio (GER) and Net Enrolment Ratio (NER) of 68.3 and 59.5 respectively. According to the report, the gross and net intake analysis indicates that many children lack the opportunity to enrol, the net intake data shows that over two million children lack the opportunity to enrol at primary 1 when they become 6 years old. Similarly, over 8 million still lack access to junior Secondary School nationwide. The report found that enablers, such as the availability of schools, classrooms and @Businessdayng
teachers for primary education nationwide are still inadequate. It found that of 33,214 public Early Childhood Care Development Education (ECCDE) schools, about 50 Percent of them were not in good condition, while the teacher-learner ratio is below minimum standards of the National Policy in Education. Ondo state has the highest with 1:372, and it’s at 1:84 at the national level. It shows that lack of teachers still remain a big obstacle to optimal access to public ECCDE schools, as Nigeria have about 72 percent of teacher deficit as only four of the 36 states and FCT has the recommended (Learner Teacher Ratio) LTR.
Company IN FOCUS
BUSINESS DAY Monday 23 December 2019 www.businessday.ng
Rensource: (em)powering Nigeria’s SMEs SEGUN ADAMS
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company with a mission to make Nigeria the first country in the world relying mainly on distributed renewables-based power generation recently announced it raised $20 million in a Series A round. Rensource, a renewable energy company, completed an equity financing round that will help in expanding its footprint and investing in technologies that increase the productivity of small-and-medium businesses in Nigeria where stable electricity is uncommon. The funding round was co-led by the micro-utility company’s existing investors CRE Venture Capital and the Omidyar Network, with participation from Inspired Evolution, Proparco, EDPR, I&P, Sin Capital, and Yuzura Honda. “We believe that simultaneously greening and decentralizing its power infrastructure is the only way to navigate Nigeria out of its current state of energy poverty,” said Ademola Adesina, Founder and CEO of Rensource. “Pursuing this with a focus on the millions of small-businesses that drive our economy creates a massive multiplier effect whose benefit accrues to all.” The plan to reach over onemillion merchants is for the next half-decade. With the fund, Rensource will be looking to expand into 100 markets in the country over the next three years. The company is also said to be eyeing an African expansion in the next two to three years. Ni g e r i a g e n e ra t e s o n l y 4,000MW for its almost 200 million people which is very low compared to around 2,300MW for Ghana’s 30 million citizens and more than 40,000 MW for South Africa’s 59 million people. The poor power infrastructure in Nigeria has resulted in multiple nation-wide power outages with the national grid collapsing at least three times in the second-half of 2019 alone. The Nigerian Power Sector Recovery Programme estimates economic losses due to epileptic power in excess of US$ 25bn annually. Businesses which have to rely on generators to operate say about 30 to 40 percent of their cost of production is tied to sourcing alternative power sources. The power gap is however being filled by alternative energy companies like Rensource which have powered thousands of homes and businesses at
Source: TechCrunch
cheaper rate than conventional generators with more stable power than the national grid. Three years of growth and impact Rensource is an off-grid solar energy firm that offers B2C and B2B solar and battery-based power subscription packages to individuals and businesses using standardised solar-hybrid systems that gets installed at point of need. The company also sells systems directly for individual modular smart-grid projects, requiring a minimum of 25 systems and provides operational support. Rensource commenced commercial operations in 2016 and was founded by Ademola Adesina and Jussi Savukoski. Adesina who started his career as an investment banker in JPMorgan had prior to Rensource worked with several entrepreneurial management teams to help early and growth stage enterprises. Savukoski, co-founder and Executive Director Rensource is an Impact and Venture Capital Investor who also works as Chief Investment Officer, Impact Investing at FIM, a Finish asset management company and private bank. So far, Rensource has operates in seven clusters across Lagos, Kano, Ogun, Ondo, Oyo and Edo, where it builds and operates solar hybrid microutilities - a type of energy services provider that localizes energy generation, distribution, and customer service to each community it serves. The company is active in marketplaces that serve over thirty-thousand SMEs. The energy company boasts
of saving Nigerians 76,575 litres of fuel and 179.800MT of carbon dioxide emissions saved through its eco-friendly solar energy (although Rensource still relies on diesel-powered generators as backup). The three-year old company back in 2016 raised $1.1 million in its seed funding round led CRE Venture Capital and four other investors. Adesina secured bridge funding of about $2m in October 2017 led by London-based Amaya Capital Partners according to an FT-report. In January last year, Rensource raised $3.5 million in bridge financing led by Mauritius Amaya Capital Partners with participation from Omidyar Network and South Africa’s CRE Venture Capital. Before becoming the first Nigerian company to be granted a loan by Trine, Rensource had by August 2018 raised $5.5m in external equity with no external debt but a $0.7 million loan from its shareholders. Trine, a company that invests in solar-projects using crowdfunding model, issued a €500,000 loan facility to Rensource. The micro-utility company has historically worked with a variety of stakeholders including community associations, government, regulatory agencies, contractors, and private investors, to build renewable energy projects across Nigeria. In 2018, the company, through a collaboration with the federal government’s Rural Electrification Agency, developed a project in Sabon Gari Market in Kano which resulted in thousands of merchants con-
necting to Nigeria’s first solar microutility. This first project was followed up by several other as part of the Energizing Economies Initiative (EEI). Rensource was the 2019 winner of the Financial Times / IFC Transformational Business Award for Climate and Urban Infrastructure Solutions. Empowering beyond Power Although Rensource started out with residential customers in focus, it has moved towards “building much larger systems to become essentially the utility for these large urban markets we have a lot of in Nigeria,” Adesina told TechCrunch. The company is now expanding its offering beyond energy and entering Nigeria’s nascent offline to online (O2O) space, by offering technology enabled value added services to SMEs in the marketplaces it provides power for. With the launch of this new B2B platform, “Spaces O2O”, merchants will be able to access services that accelerate their productivity growth, Adesina said. “Our push into O2O is a natural step that leverages our existing infrastructure to further empower the merchants we serve. We aim to bring connect over one-million merchants in the next 5 years.” Rensource will unveil tools to bring merchants more into the formal economy, allowing them to do inventory management, accounting and track sales. Rensource has grown a leading foothold in the Nigerian market, it has identified gaps in the distribution value chain regarding lack of access to credit,
expensive transportation and warehousing, inaccurate data and limited product availability, underpinned by a highly fragmented and multi-layered value chain. Financial Performance Although the financial reports of the company is private, Rensource according to a TechCrunch report that quotes Adesina, did a few hundred thousand dollars in revenue in 2017. The solar-energy firm did about $7 million in revenue and “generated a small profit last year”. Management Senior Management at Rensource includes Anu Adasolum, who is Chief Operating Officer (COO). She holds a Master’s degree in Management, Organisations and Governance from the London School of Economics and Political Science (LSE) and was previously head of JForce Transformation at Jumia Group before joining Rensource in 2018. Rensource’s Vice President Projects, Kolawole Akinboye, is Lagos Business School (LBS) trained Business Administrator with a previous experience as Senior Project Engineer (Solar Projects) at Total before he joined Rensource as a director in 2017. Alatishe Mayowa who is Vice President Technologies at Rensource was formerly a Manager at KPMG, one of the big 4s. The VP of Corporate Finance at Rensource Energy, Szabi Baranyi, has international experience and is a CFA charter holder. Hendrik Lühl, Rensource’s Senior Technical Manager has over a decade worth of experience in Engineering (project, product, electrical etc).
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