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How Agric Ministry’s shoddy management I of N8.85bn frustrates wheat production C

Rwanda seeks to jumpstart eCommerce in Africa

TEMITAYO AYETOTO

orrupt management of N8.85 billion Federal Governmentapproved budget for wheat by the Ministry of Agriculture is stunting the development of the crop, leading

As Nigeria’s import bill set to double by 2025

to rising import bills currently estimated at N250 billion per annum, according to the most recent data from the National Bureau of Statistics.

BusinessDay checks on wheat

budget between 2016 and 2018 show that while there is growth in budgetary allocation for wheat, there is a decline in wheat production.

In 2016, for instance, a total

of N1.75 billion was budgeted for wheat development. This increased to N4.05 billion in 2017, but fell to N3.52 billion last year.

Continues on page 34

nternet users in emerging markets outnumber those in developed markets by a ratio of 2:1. Yet many emerging markets have struggled to access the benefits of digital commerce.

The global market in digital commerce is estimated to reach more than $3 trillion this year, yet Africa claims less than $20 billion in ecommerce revenue.

Rwanda is seeking to increase its share of digital commerce revenues by joining the Alibabaled trading platform, Electronic World Trade Platform, which connects Rwandan and Chinese buyers and sellers.

Having signed onto the platform in October 2018, Rwanda’s President Paul Kagame is already seeing benefits.

The opportunity to sell on the platform “brings in the otherwise marginalised, [such as] … the young people, the farmers.

This has helped bring them a connection with the consumers,” Kagame explained.

He said that extending digital Continues on page 34

Inside VAT hike likely as FG retools revenue strategy P. 35

L-R: Ibrahim Mashi, project manager, The Bridge Peridot; Olayinka Braimoh, CEO, Hall 7 Real Estate; Timi Dakolo, singer, and Ayo Makun, comedian, at the commissioning of the Bridge apartments and town houses in Abuja.

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Thursday 24 January 2019

Nigeria’s software market risks huge losses to hackers ... as sales, innovations distract players JUMOKE AKIYODE-LAWANSON

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aving witnessed exponential growth over the years on the back of rising smartphone, tablet and wearable device ownership and significant improvement in broadband internet services, industry watchers fear that the mismanagement and non-regulation of mobile application development in Nigeria’s multibillion-dollar mobile app market can be highly prone to the exploitation of software hackers and cyber criminals.

They say that Nigerian software developers are more concerned about the acceptance and sale of innovations rather than about the perfection and, more importantly, protection of their intellectual property.

“Most app developers in Nigeria are focused on promoting their apps to increase the amount of downloads and revenue they get, forgetting totally about how to update and upgrade their apps to ensure its security. Even the downloaders are not concerned about how to secure the apps on their mobile devices,” Subomi Sodipo, CEO, CFMobile, told BusinessDay. In 2013, when the Nigerian mobile app market was valued at $1 billion at the mobile app summit, James Rutherford of Nokia Corporation said, “The sub-$100 smartphone is steadily becoming a reality globally. Low-end smartphones are increasingly available and these types of mobile phone will likely grow at a compound annual growth rate (CAGR) of 15 percent over the coming years.”

This forecast became even more evident in reports by GFK Retail and Technology Nigeria which listed the country as the third highest tech device growth market globally in 2015, with a 13 percent growth between 2014 and 2015. According to the report, sales of technology

devices rose from $5.1 billion in 2014 to $5.7 billion in 2015. Gaming apps have so far spurred the rapid growth of mobile software applications, as Nigeria’s app-based mobile gaming market was in 2018 valued at $21 million and is estimated to be worth $53 million by 2022, according to Statista. com, an online research tool.

Norton, anti-virus and software security company, says victims lost an average of $142 billion to hackers in 2017.

Businesses in Nigeria and neighbouring West African countries lose $140,000 daily to hackers and internet fraudsters, according to Trend Micro Incorporated, a global leader in cyber security solutions.

According to 2018 figures from Jumia’s mobile report, mobile phone penetration stands at 84 percent of Nigeria’s population. 53 percent (97.2 million) of those are smartphone users.

Analysts say that the increase in popularity of smartphones, increase in Nigeria’s broadband internet penetration, which now stands at 31 percent, and minimal usage of mobile security solutions create an open avenue for hackers and cybercriminals to move from the traditional desktop and laptop online fraud to mobile online space which virtually has a more open access to personal and financial information such as mobile banking apps, social media apps and sensitive data.

Femi Fadairo, head, industry security, Nigeria Inter-Bank Settlement System (NIBSS), said at a cyber security andbankingfraudsummitinLagosthat Nigerians are becoming too comfortable transacting on electronic channels through their phones without taking precautionary measures and so it has become necessary for software/app developers to protect their apps.

•Continues online at www.businessday.ng

Nigerian art market records N400m from auction sales in 2018 ... Arthouse controls major share, online platforms boost access OBINNA EMELIKE

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he Nigerian art market is looking up as it made impressive sales of over N400 million from over 200 lots sold at auctions across the country in 2018. The figure surpassed previous records in the last 10 years, especially the N286.6 million and N232 million recorded in 2013 and 2012, respectively.

Arthouse Contemporary Ltd controls over 70 percent of the sales with its two auction windows of June and November, where over N300 million was realised from the sales of artwork by indigenous artists last year.

Arthouse made the sum of N233.06 million from the twentieth edition of its auction of Modern and Contemporary Art held at the Kia Showroom, Victoria Island, Lagos on June 4, 2018.

The auction, which marked the 10th anniversary of Arthouse Contemporary’s auctions, featured 105 lots of leading master works from the modern period alongside cuttingedge contemporary art from the region’s most celebrated artists.

The star sale at the June auction sales was Ben Enwonwu’s ‘Anyanwu’, a bronze sculpture from circa 1975 that sold for N59,800,000. This was followed by ‘Negritude’,a watercolour

on paper from 1990 also by Ben Enwonwu, which sold for N46,000,000.

The art auction house also made N107,113,500 from 100 lots at its November sales in Lagos where works across several genres by master and upcoming artists were on display.

As well, Terra Kuture made impact with its Lagos Art Auction on July 27, 2018, where N28,020,000 was realised from the sales of 69 lots.

Aside from the two major auctions houses, the Nigerian art market is soaring with the springing up of online galleries and art platforms that open the Nigerian art space and offer access to works by Nigerian artists to millions of people across the world.

Inspired by the opportunities in the global art market valued at over $50 billion and auction turnover of $8.45 billion, representing 18 percent increase in 2017, these online platforms are using technology to break market barriers, make art accessible and affordable, and woo many to their trendy offerings.

One of such platforms is the Art635, an online art gallery which is open to painters, sculptors, photographers and artists of all forms in Nigeria and across Africa.

So far, Art635 has featured over 5,000 unique artworks by different

Continues on page 34

Mahmood Yakubu (3rd r), chairman, Independent National Electoral Commission, and the 2019 general election delegation of European Union Election Observer Mission to Nigeria during the delegation’s visit to INEC in Abuja.

Pic by Tunde Adeniyi

Lingering court cases hinder power sector growth ... as NERC has 33 active cases, most from operators ISAAC ANYAOGU

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ith 33 active cases in different courts in the country, the Nigerian Electricity Regulatory Commission (NERC) is the most sued regulator in Nigeria, spending more time handling briefs than writing regulations. This is excluding suits market participants instituted against government and customers against operators, ensuring that operators waste valuable time and resources on legal disputes.

The electricity sector regulator in its third quarter report said the current cases relate to ‘illegal’ disconnection by DisCos, wrong customers’ classification, land trespass, suspension of Ibadan DisCo Board, granting of Eligible Customer status, among many others.

Nigeria has a plethora of regulatory agencies, from the Central Bank of Nigeria playing an overarching role in the financial sector to Nigerian Film, Video and Censors Board in the entertainment industry, but no other regulatory agency is sued with the same enthusiasm as market participants in the power sector sue their regulator.

Nigeria’s power generation companies (GenCos) and electricity distribution companies (DisCos) have become clever at creating reasons to sue their regulator than actually

generating and distributing power which are their remit.

This leads to waste of valuable time and resources deployed in fighting fires rather than fixing issues. It also bogs down the sector as progressive regulations wait upon endless litigations. The snail pace at which litigations proceed in Nigeria provides a sanctuary for the unwilling.

Analysts attribute the rising spate of ligations in the sector to the long period the commission was without a head which seemed to have weakened it, as well as its perceived lack of independence from government which further emboldens operators to take shots at it.

“What led to this was the gap we had of almost 18 months of no strong commission that gradually led to a weakening of the commission,” said Dolapo Kukoyi, partner at Detail Commercial Solicitors, heading the power practice of the Lagos-based law firm.

When the tenure of Sam Amadi, erstwhile chairman of NERC, and its commissioners ended on December 21, 2015, the commission operated without a head till April 2018 when lawmakers confirmed James Momoh as acting chairman. Anthony Akah was acting chief executive for some months, a position unrecognised by law. Prior to this, in February 2017, Babatunde Fashola, minister of Power, Works and Housing, had appointed commissioners for NERC.

“When you are in a market and there are a lot of uncertainties, as an investor, you have to look to other sources of recourse if you can’t trust your regulator,” said Kukoyi.

Caleb Adebayo, energy lawyer at Templars, a Lagos-based law firm, said the rising spate of ligations shows that consumers have become more aware of their rights and are motivated enough to show displeasure.

“What this essentially speaks to is that NERC has to be more proactive in regulating the sector,” said Adebayo.

NERC as regulator has often been accused of allowing the tail wag the dog. When DisCos began to flout market rules by keeping more revenue generated in the market than they should, the regulator failed to discipline them. This emboldened them and bred further rascalities, including ‘crazy electricity billings’, rejecting power, denying customers of meters, and instituting frivolous lawsuits against NERC. For example, DisCos sued NERC as soon as the Eligible Customer regulation, which would take care of power they routinely reject, was created. GenCos cried to the court to stop the Federal Government and NERC from paying Azura Edo IPP from N701 billion intervention fund government created without recourse to them.

•Continues online at www.businessday.ng

Real reasons over 40% of houses in Apapa are empty …annual rental income loss per street put at N250m CHUKA UROKO

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papa, Nigeria’s premier port city, has become synonymous with congestion and gridlock, which is why anybody who has a passing knowledge of the city would dismiss it as a no-go-area for lack of access.

Though gridlock is a huge challenge that cannot and should not be glossed over, there are more to Apapa’s problems than just traffic and these are the real reasons over 40 percent of houses, mostly residential, in this otherwise enviable and

ANALYSIS urbane destination is empty.

In what could be likened to locust invasion, operators of commercial motorcycles (otherwise called ‘Okada’), Keke Marwa or tricycles, and Danfo (mini-buses) have invaded the port city, creating security issues that put residents and business owners on edge and scaring prospective renters or home buyers.

“It is an intriguing contradiction that in a port city whose economy is in excess of N20 billion a day, where

a number of businesses are dying, the only industry that is thriving is ‘okada’ riding because other means of movement have been impaired by collapsed roads infrastructure, mindless and indiscriminate parking of trailers and tankers on all roads and bridges,” Emmanuel Ameke, a port worker, noted in an interview.

The failure of the Lagos State government to do what it is supposed to do by outlawing commercial activities in the area, including mechanics, vulcanisers, people frying bean cakes

Continues on page 34

Thursday 24 January 2019

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Absenteeism, extortion rank high as report exposes corruption in Lagos schools TEMITAYO AYETOTO

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he delivery of quality education across various levels in Lagos public schools is currently endangered in the hands of teachers, as absenteeism competes with extortion, abuse and sexual harassment in a cycle of quiet corruption going on.

The incidence of absenteeism among primary school teachers is at a 27.4 percent high, followed by 21.6 percent rate of pupils’ abuse and undue monetary demands from parents, a report by a non-governmental organisation, Human Development Initiatives (HDI) in conjunction with Trust Africa, reveals.

Compulsion of payment for extra lessons, an instrument used by teachers to raise additional income, is found to be prevalent at 36.1 percent at the primary level

and 41.7 percent at secondary level, depreciating the teaching quality during regular academic hours.

In secondary schools, compulsory sale of study materials led the rest of the pack at 34.9 percent and is followed closely by favouritism 27.9, absenteeism by more than a quarter of teachers 27.1, sexual harassment 26.9, and non-academic task to students 24.2 percent.

Sexual harassment is almost unquiet in the state’s tertiary institutions as it is at a 36.2 percent high, compulsory sale of study materials (34.9%), absenteeism (33.6%) favouritism (23.5%), and sex for grade (23.5%).

Olufunso Owasanoye, executive director, HDI, reckons that endemic corruption has eaten deep into Nigeria’s public system of service that it continues to manifest in the performance of civil servants, public officials as well as policy makers.

Speaking at the launch of the report in the state capital, Ikeja, she describes unfettered misconducts of teachers as less visible with little attraction, yet not less lethal in consequence.

The culture of silence, which has over time locked the problem in the shadows, is an issue she says must be collapsed if people truly desire an accountable educational system.

“It is a pity that most school administrators and government agencies saddled with the responsibility of taming corruption are shielded from investigating the occurrence and prevalence of quiet corruption within the school systems,” Owasanoye says.

“It takes diverse forms and patterns sometimes within a demand and supply framework, and many times within the power structure backed by culture or bureaucracy.”

Remita, Verve partnership to extend payment services

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emita, Africa e-payment platform, is partnering Verve, a pan-African financial technology brand, to further enhance the payment experience of millions of customers by enabling them to pay thousands of merchants on the Remita platform using their Verve card.

This was disclosed recently when both brands announced their partnership, which increases the card payment options available to customers on the Remita platform.

“The acceptance of Verve cards on Remita represents increased convenience to Remita customers, and a strategic partnership for markets in which Verve operates,” Demola Igbalajobi, divisional head, products, services and international business at SystemSpecs, owner of Remita, says.

“This partnership em-

powers Verve customers to access all Remita merchants, and is in consonance with our objective of making payments easier for more payers across Africa.”

With this development, using a Verve card or virtual token, customers can settle various bills in a fast, convenient and secure manner from anywhere and at any time.

Commenting on the partnership, Mike Ogbalu, CEO, Verve International, said: “We continually seek out viable opportunities and partnerships that expand functional coverage of Verve’s physical and digital tokens, and such collaboration as this is testament to that relentless drive.

“It is an exciting development, not only for us as an organisation but more essentially to millions of Verve customers, as it means there are now even more things they can do

with their Verve cards and digital tokens.

“More so, this partnership further consolidates our service footprint across the Nigerian and African financial ecosystem and guarantees that more customers would enjoy the benefits that accrue from using a Verve card.”

This collaboration is expected to be enjoyed by millions of Verve and Remita customers across Nigeria and the African continent.

Remita is an integrated payment technology that helps individuals and organisations to easily make and receive payments via multiple channels and financial institutions, roundthe-clock.

Verve is a payment brand that powers transactions online, and at Point of Sales (PoS) terminals, merchant’s website as well as Automated Teller Machines (ATMs).

Lifemate comes up with 2nd outdoor swap promo

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ifemate Nigeria Limited, a leading furniture manufacturing company and provider of quality furniture products, has announced the upcoming of second edition of the Annual Sofa Swap promotional campaign.

“It is that time of the year when Lifemate customers from all its branches nationwide enjoy discounts and offers. The maiden edition of the sofa swap promo was lunched September 2018, and the promo was launched to give opportunity to customers and those who desire to experience

the high quality service delivery of the company furniture products,” according to the firm in a press release.

The promo gave Nigerians the opportunity to exchange their old sofas for new ones. The company also says the sofa swap promo is back, and this year promises a lot more than before, and the swap for this year will be on outdoor furniture.

The marketing manager of the company, Fu Pingping, states that the outdoor furniture swap promo is for the duration of one month starting from January 27 to February 27, 2019. She

says customers who bought outdoor furniture from Lifemate from 2016 to 2017, who desire new outdoor furniture Rattan Frame design are advised to bring the products to exchange for a new design.

Also, customers can enjoy 13 percent discount on the entire collection of the new outdoor furniture Rattan Frame design they will like to swap.

She encourages customers to start the New Year with a new look for their homes, using Lifemate outdoor furniture that can impress.

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Lessons for Nigeria as Saudi Arabia plans refinery, petrochemicals plant in South Africa DIPO OLADEHINDE

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ews of Saudi Arabia’s plans to build an oil refinery and a p e t ro c h e m icals plant in South Africa as part of $10 billion of investments in the country will probably send shivers down the spines of Nigeria economy managers. For many of these managers, the economy has taken a backseat, no thanks to distractions from next month’s general election to which they have exposed themselves.

When it comes to investment in Africa’s oil and gas sector one would predict the frontrunner to be the continent’s biggest oil-producing country. Nigeria has the requisite production capacity, huge oil reserves and massive gas reserve. However Nigeria is not the first-choice country for such as purpose, and understandably so. Nigeria is fast losing its competitiveness to other countries with lower oil productions but simpler oil and gas legislation and better business environment.

Although South Africa

currently has six refineries with two using synthetic fuels as feedstock, while the other four use crude oil, with Royal Dutch Shell, BP, Total and Sasol being the major operators. However, for about a decade, South Africa has been making plans to build an extra refinery but has been unable to agree on commercial terms with investors.

Saudi Energy Minister, Khalid Al-Falih, said in his comments after a meeting with South African Energy Minister Jeff Radebe few days ago in Pretoria that the planned refinery would be run by state-owned energy firm Saudi Aramco using Saudi’s oil.

Ministers Jeff Radebe and Al-Falih have already signed a Memorandum of Understanding (MoU) to cooperate on oil and gas undertakings. Under the MoU, projects will be launched in South Africa, managed

by Saudi Aramco and the South African National Oil. Radebe said that the exact location of the refinery and petrochemicals plant would be finalised in the coming weeks.

“Saudi Aramco and

South Africa’s Central Energy Fund are moving forward with the feasibility study and identifying the parameters of the project,” Al-Falih told reporters in Pretoria, South Africa’s administrative capital.

The announcement by Al-Falih comes as a muchneeded vote of confidence in Africa’s most industrialised economy, where President Cyril Ramaphosa is trying to attract $100 billion of new investments to rekindle growth and help revive a struggling economy as he prepares for a parliamentary election this year.

The new refinery would reduce the need for refined product imports, and ensure energy security for South Africa and allow the country to supply crude oil and other petroleum products, which would serve as a boost for the Rand.

The Arabian nation is also expected to invest billions of dollars in South Africa’s renewable energy programme through Saudi power firm, Acwa Power while talks are also underway to invest in South Africa’s state defence company, Denel.

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Election: Situation Room sets threshold for TCN confirms re-routing ‘Kano Disco feeders’ to INEC, security agencies, others address power failure alignment between elecOWEDE AGBAJILEKE, Abuja

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igeria Civil Society Situation Room has outlined the minimum standards required from the Independent National Electoral Commission (INEC), security agencies, political parties and state institutions must fulfil to give credibility to the forthcoming General Elections.

In a threshold document released at the unveiling of the Situation Room Hub for the elections in Abuja on Tuesday, Situation Room outlined minimum expectations that the conduct of the 2019 elections must meet to pass the test of free, fair and credible elections.

The election is billed for February 16 and March 2, 2019.

Speaking at the unveiling of the Situation Room Hub for the elections, Convener of the coalition, Clement Nwankwo, demanded that the electoral body must ensure that there is absence of multiple registrations, removal of under-aged and deceased voters in collaboration with the National Population Commission, ensure

tion data and demographic data; keep timely adherence to guidelines for display of Voter Register, give voters sufficient time to verify their details.

Nwankwo listed other minimum requirements from INEC to include: audit of Permanent Voter Card (PVC) collection process and rates, uncollected PVCs, and protocol for storage and protection.

He called on the electoral body to publicise to all stakeholders, the reforms it has made regarding any malfunctioning of the Smart Card Reader (SCR), during the Accreditation and Voting procedure and make a commitment to a special audit in the event of a 5% card reader incidence failure.

Nwankwo also called on INEC to put a transparent results collation process in place, commit to publishing the collation process no less than 15 days after the election, and ensure unfettered access by accredited observers and all party agents to collation centres as well as non-participation of security agents in collation process at any level.

HARRISON EDEH, Abuja

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ransmission Company of Nigeria (TCN) says it is presently back-feeding Kano Disco feeders (feeding the load through another route) affected by the recent failure of one of its 150MVA 132/33kV power transformers in Kumbotso Transmission Substation.

TCN, in a statement on Tuesday, says the backfeeding is being effected from other available 2 x 150MVA transformers in the station to ensure consistent bulk electricity supply, while it effects repairs on the 150MVA 330/132kV power transformer which tripped earlier this year in the substation.

Ndidi Mbah, the TCN general manager in the statement, says on the January 1, this year, one of its 150MVA transformers in Kumbutso substation tripped, causing TCN lose about 90MW on the Kano –Kankia – Katsina 132 kV line 1, which feeds Kankia, Katsina and Daura as well as the Kumbotso – Dakata 132 kV transmission lines, thereby affecting supply to Kankia, Katsina and Daura in Katsina State as well as Sabon Gari, Dakata, Bompai, Mariri and Gezawa in Kano State.

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comment Positive Growth with Babs

Babs Olugbemi Olugbemi FCCA, the Chief Responsibility Officer at Mentoras Limited and Founder, the Positive Growth Africa. He can be reach on babs@babsolugbemi.org or 08025489396.

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y plan was to make this week’s article an extension of last week’s take the lead and with a captivating title, what are you giving in 2019? But a call from one of the addicted readers of this column changed the plan and I have no choice than to write for my readers.

Joseph was the successful candidate among ten applicants to lead a company in the fast-moving consumer goods industry into its next phase. Having been in the leadership position for five years, Joseph wants to know the immediate expectation of a new leader, especially in his new role and circumstance. He asked me what is expected of him as a new leader.

My choice of word, ‘new leaders’ does not depict people joining the leadership cadre for the first time.

You might have been leading for ages, but the business environment keeps changing, the leadership situation is evolving and since we are at the beginning the year, your company’s financial year is new, or your people want to be different in the new year. New could also mean your resolve to adopt a new leadership style and lead your people better.

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comment is free

Send 800word comments to comment@businessday.ng

For new leaders only Whether yours is a change of baton, a new business objective or just a willingness to be better in leading your people, you are expected to achieve what I termed the four elements of leadership effectiveness. These elements are the foundation for the successful achievement of your business performance indicators and they are: adaptation, innovation, change and growth. Therefore, all new and existing leaders are expected to have an excellent scorecard depicting performance growth, positive change in the workplace culture, innovation within the industry and adaptive mindset to changing business and political environment.

Before I explain these elements, you should understand the need to measure team leads or direct reports using the agreed key performance indicators for their teams or functions. But as a leader, focusing on these elements will provide valuable insight into the sustainability of the progress or success recorded by your teams.

To adapt according to the Cambridge dictionary is to change your ideas or behaviour to make them suitable for a new situation.

You must adapt to the leadership demand for your new role. The good news is that you have what it takes to adapt. Your experience is the basis for your personal adaptation. A man with experience cannot be at the mercy of a man with an argument. Your experience counts in managing people, process and the products. In practical terms, you must adapt to the culture of the company if you are a new hire. If your role is a C-level role, you might need to adapt to public speaking, leading strategic meetings and people more. You must be on top of the economic and the technical aspect of your

‘

Where your team is innovative, it is a matter of time for your elephant (products) to dance and dance well in the market square. An innovative leader will gain speed with losing the agility required for his or her company to be relevant in the market place

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business including the value chain.

Adaptation has a price and you must be willing to pay the price. The price could be, for example subscribing to the Businessday newspaper to get the most accurate information on the economy. It’s usually best to complement your experience with others who have “been there and done that.” So, surround yourself with people who have the experience to adapt your business process and products to the reality of the time.

Importantly, is having a team who can achieve the objectives of all the stakeholders by working with and leading people efficiently.

For any business entity to maintain its market share and gain competitive advantage, innovation in product delivery and customer service is a must. Gone are the days when being the first to the market is all a company need to be the market leader. Leaders who embrace and measure innovations tend to rule the market and make the first mover advantage a slogan. As a leader, you must, therefore, create an in-

novative and learning atmosphere supported by a well-equipped research and information team. It is part of innovation to know the changing needs of the customers and develop, modify or align your product offerings to meet the evolving needs of your consumers.

Where your team is innovative, it is a matter of time for your elephant (products) to dance and dance well in the market square. An innovative leader will gain speed with losing the agility required for his or her company to be relevant in the market place.

Change is the twin brother of innovation. Innovation and change in business are intertwined. They are the essentials in leading people and selling to people. I recently developed and train some sales professionals on the act of customer-focus selling and the need to change in line with the customers’ preferences even with the most innovative products in the market cannot be over-emphasized. As a leader, you are to change what needed to be changed to move the company forward. Leaders who do not embrace change and do things the way they have been done are managers. Managers manage the process whereas leaders lead all the component of the enterprise through people. Just as the football coaches will never want to change a winning team, leaders must implement change only if it is necessary and the benefits outweigh the cost of changing. Before you approve or implement any change, the new process or products or business structure must be because of positive innovations to the organisation. Unlike in the political sphere where a new administration wants to erase the traces of the preceding one, business change and innovations are not white elephant projects meant to meet the psycho-

logical egoism of the leaders, rather they must advance people, process, products, customers and all the stakeholders of the enterprise.

There is no growth without the elements of adaptation, innovation and change. The essence of appointing a leader to lead any organisation or institution is for growth.

Growth could be in quantitative terms like growth in sales revenue, market share and penetration, segment productivity or in qualitative terms like customer preference and loyalty, employee engagement and satisfaction and many more.

A leader with growth at the end of 2019 will face his shareholders to explain his or her activities in absolute terms. Thus, he or she will say, we increase the profit before tax by N2billion. Where there is no growth, the report is likely to be rendered in a relative terms e.g our loss reduced by 2% instead of

by N1.5billion.

Therefore, for both new and old leaders to achieve results, they must focus of how good their teams are adapting to the business and people’s emotional topography, the quantity and level of successful innovative ideas, the agility to change and collective growth recorded in all or most of the key success indicators for the industry.

Whereas the four elements of leadership I have discussed are not a substitute for the job key performance indicators at the operational level, leaders must, however, focus and reward these attributes among their direct reports and teams.

The effectiveness of the leaders in achieving his or her agreed deliverable is anchored on the level of adaptability, innovation, change and growth exuded by the team under his or her purview.

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Benefits of technology in driving a better efficient transport system

FESTUS OKOTIE Okotie, a maritime transport specialist, wrote via fokotie@festusokotieconsulting.com, fokotie@bernardhallgroup.com and fokotie.bernardhall@gmail.com

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he transportation industry has been one of the sectors to test the emergence of technology advancement and innovations. As one of the key sectors that needs to get more efficient results, it is important to constantly optimize performance and results through the application of technology and modern communication systems.

Transportation management solutions have been sought after more because of the high growth rate. It is aimed at reducing transportation costs and increase reliability through collaboration across all modes. It allows organization to manage their international and domestic transportation, tackling supply chain complexity with

integration and to partner systems with a single control layer for monitoring the life-cycle of transportation. The bidding and awarding of contracts processes can be completed on the platform, execution monitored and changes made based on detailed analysis of transport data available.

Shippers, suppliers and logistics service providers all collaborate in the cloud with transportation management system. A typical scenario would include both inbound (procurement) and outbound (shipping) orders to be evaluated by the transportation management systems (TMS). Its planning module offers the user various suggested routing solutions. These solutions and data can be assessed by the user and are passed to the transportation provider analysis module to select the best mode and least cost provider. Once the best provider is selected, the solution typically generates electronic load tendering and traces to execute the optimized shipment with the selected carrier and supports freight audit and payment.

Transportation Management Systems (TMS) products serves as the logistics management hub in a collaborative network of shippers, carriers and customers. It’s software modules include route

planning, load optimization, execution, freight audit, payment, yard management, advanced shipping, order visibility and carrier management. A fully deployed TMS brings about the reduction of costs through efficient routing, load optimization, mode selection, improved accountability, visibility into the transport chain, flexibility for last minute contingencies to alter the delivery plans and key supply chain execution requirements.

Transportation management systems comprises of sourcing, rating, planning, tendering, freight payment and audit. These help to reduce transportation costs. They eliminate billing errors in the audit process, standardizes globally on one transportation management platform, reduces transportation provider switching costs by gaining faster deployment and low cost of ownership.

There are many benefits of transportation management systems that manufacturers, distribution companies and anyone who ships freight can use. If you can look at your freight and transportation department as more than just a cost, then you are thinking in the right direction on how to fully help your business leverage on transportation management system for the maximum return on investment (ROI).

Transportation management

systems helps companies move freight from origin to destination efficiently, reliably and cost effectively. It encompasses solutions for moving freight in all modes and also includes intermodal movements, freight transported inbound or outbound, domestically or internationally using transport assets owned either by the company or an outside service provider. The freight managed by a transportation management ranges in sizes from parcels to bulk commodities.

The application offers so many ways to save money or drive value in the supply chain network, and blue-chip companies deploy this application to reduce freight spending based on proper process enforcement, analysis and optimization.

Shippers that implement TMS solution compared to traditionally methods of transportation management perform better in terms of service levels and freight savings. Transportation management system with reporting and analytic details enables you to see the effect of your choice within the system leading to better customer service delivery.

The more you use the application the more you decrease time on freight management and more time working on other projects such as warehouse duties and other areas

within the transport sector. It also gives you the overall combined supply chain visibility you need to make better business decisions that helps drive further cost savings and decreases inefficiencies within the system. A robust application also offers the ability for you to optimize the way you transport your goods and services. It gives you confidence that your customers are receiving their orders on time and allows you plan better for your inventory at hand. Accurate forecasts of your inventory is very important because of the increase in e-commerce transactions, employing proper accounting process through payment, auditing and consolidation services. Within a TMS solution an entrepreneur can make quite a lot of profit and this is what big organization globally are leaning on.

Being fully convinced of the benefits of technology in driving an efficient and more reliable transport system, there is urgent need for Nigerian (public and private) companies and other transport organizations within the African region to invest more in the knowledge and application of intelligent transportation systems which is the solution to achieving better output and results.

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Feyi Fawehinmi Fawehinmi is an accountant and lives in the UK

T

he Vice President was in Germany last year during which he spoke to investors about the potential for investing in the Nigerian market. When he got talking about agriculture, he made a comment that set alarm bells off in my head.

“Carlos Farms, a Mexican fruit and vegetable investor, had initially planned to grow bananas and pineapples for export; until he discovered that he was making more money selling his bananas locally at $3 dollars a kilogramme, for what he would have been paid only a dollar per kg in Europe.”

The reason for the price dif-

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Banana ferential is simple. You have to harvest bananas while they are green, then wash them with soap and water (if for exports).

This is important because once the banana starts to ripen, the process cannot be halted or reversed. They also have to be shipped at exactly 14 degrees centigrade in special refrigerated ships to stop them from ripening during the journey.

Timing is so important so that they start to ripen as they get to the supermarket. Then, after all this wahala and hard work, a banana costs only 18 pence (less than N100) at a Tesco supermarket in the UK. As such, we are certain that growing and selling bananas in Nigeria involves a lot less work than selling them in Europe where you have to grow them in the Caribbean and then ripen them with ethylene gas in the UK and so on. It is bad enough that Nigerian bananas can then be sold for 3 times the price in Europe. But to then have this celebrated by the Vice President, in a foreign country no less, as proof of how much money you can make in Nige-

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‘

How can Nigerians — some of the poorest people in the world — be paying 3 times what Europeans — some of the richest people in the world — are paying?

How can this ever be ok?

’

ria? Unbelievably depressing.

How can Nigerians — some of the poorest people in the world — be paying 3 times what Europeans — some of the richest people in the world — are paying? How can this ever be ok?

This is the part of Nigeria’s poverty that is self-inflicted. Government, faced with a choice, 10

times out of 10, sides with the producer interest. These producer interests are then held up as a success. It is the model that gave us Aliko Dangote, a cement billionaire in a country with shambolic infrastructure and a housing deficit of close to 20 million. If these guys can sell their bananas for $3, then you can be sure they are not going to export anytime soon. Why bother? And if and when they run into trouble, you can also be sure they will be in Aso Rock lobbying for a ban on something or the other.

There might even be a scenario where something like this might make some sense for a short period of time. A smart government might say — the global banana market is worth billions annually and most of it is produced by countries that Nigeria can reasonably hope to take some market share from.

The government can then tell producers — for a limited time period, we will protect you locally so you can charge slightly higher prices but on the condition that you must export a certain amount every year. The

high local prices you charge will allow you charge lower export prices so you can win market share. We will only let you do this for 5 years and after that, we will remove all protections from you so that local prices can fall and Nigerians can enjoy reduced and competitive prices. This is a short summary of how the Koreans built up their car industry.

Many countries (especially in Asia) have done similar things.

Yet, from the VP’s comments, the company was even going to do this by itself before reversing course.

But Nigerian governments never do this. They just throw their citizens to their favoured producer and move on to find the next winner. They then celebrate the ‘achievement’ of creating a new billionaire.

If you’re still surprised that Nigeria is a poor country, I am surprised at your surprise. People are poor because they don’t earn enough. But they are also poor because they pay too much for food and other basic items.

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Five things from the Buhari-Osinbajo town hall meeting

SAM ELEANYA Sam Eleanya, poet and author is a legal and socio-economic policy strategist. He is the author of Preambles before the preamble and founder, LawNigeria.com]

I

have watched videos and listened to ‘clear ‘ and ‘undoctored’ audios of the Town Hall meeting featuring President Muhammadu Buhari and ‘Vice-President Yemi Osinbajo as presidential/Vice-Presidential candidates of the All Progressives Congress, APC with Kadaria Ahmed as moderator. I have five things to say.

1. Buhari did not disappoint: He did not disappoint anyone who has been paying attention to him over the years – with regards to his abilities in articulating clear policy goals and development themes in a way that can inspire and/or unite a nation, using the English language (for it is possible he does better using other languages or body language). To be fair, he actually improved his ‘listenability’ quotient.

In past debates, Buhari was always guilty of answering whatever he felt the question was. This time around, he was humble and human enough to make the effort to try and hear the questions. When

he finally did hear the question after a few repetition by Kadaria and echoing by Osinbajo, he again made the effort to be ‘heard’. Often, that included having his vocal palates make some introductory alien sounds – but, to be honest, his elocution was better. His ‘Ps’ came out as ‘P’ and not as ‘F’. His comportment also improved. In previous debates, it seemed like he was more interested in projecting the infamous body odour, sorry, body language that has now been proven to be benign and not enough to curb corruption.

In this media exposure, Buhari was slow and deliberate. He was not deep: never was. He was not cerebral: he clearly has no Noble laureate ambitions. Poor guy.

Was he clueless? Sometimes – in a Buhari sort of way, answering in rural metaphors what the rest of us would prefer he engaged with some complex metropolitan dribbles as President of Africa’s largest economy. He answered the questions that Osinbajo could not deflect away and onto himself from his limited world view using his limited English vocabulary.

Best part: he had help that he was prepared to accept at every turn: Osinbajo. It was not a stellar performance. But, nobody who has followed his career would have expected more including the very educated who voted for him.

However, it is not wrong or unfair to ask the question: could Nigeria not do better to have a President with the intellect of Osinbajo and the vote magnet of Buhari?

2. Can Buhari stand up to an open debate in 2019? Not that he could in the past – even if he did try in his previous incarnation as

a failing presidential candidate – APC should swallow hard and just agree that they have no presidential candidate who can go head to head with Madam Due-Process, the Sahara-Reporter fella, the Inspirational talk dude, the retired Central Banker, etc in 2019. Their Vice President can though – but he is the Vice Presidential candidate.

Buhari, in English language (to keep it real), has a problem stringing together coherent policy thoughts relating to governance, save in a few areas where he is very comfortable.

Statistics, dates and actual names of government agencies – except EFCC, ICPC, Police and the Army, escape him so easily that you can tell he does not bother with such ‘inanities’. Those are the spice of modern debates – even if they expose one to the brutal witch-hunt of fact checkers.

3. Will Buhari lose his core support even if he debates Obama for the 2019 elections?

Thanks to the PDP and those who decided to hate on Buhari right from the day he won, the standards for re-election has been lowered, actually, dumbed down, for PMB in the minds of his voters. There are now a few check-lists he needs to tick to get their tick in his margin.

Number one: is the man asking for their vote Jubrilu/JewBeReal/Jibril/ etc from Sudan? Answer: No. Check.

Number two: is the man sickly and gutted by age? Answer: No. he actually appears to be in great health and looks so much better than his actual mates, just in case the official number is lower. Check. Number three. Does he have an able and loyal Deputy if somehow he decides to turn in early? Check. Yes. He does.

Nigerians now universally agree,

many grudgingly even while calling him a ‘midget (which he is not), that Osinbajo is a Vice President that can be trusted with the levers of presidential powers. And number four. Does Buhari retain some convictions? Check. He retains a narrow and somewhat nebulous convictions-pool which he may never ever articulate coherently: which others may need to articulate when he is through.

4. Did the media outing win him some votes? Yes. Aged persons will likely vote for him. They will like that he has cheated death and still can hold himself together – even if he sometimes needs to have a question repeated three times with a microphone to hear it. Many young people who have never frankly listened to him give an extensive live interview like that since he became president could think him gross and old – but not exactly a Monster. Age has mellowed him some – and that’s not bad thing when compared to the hyperbolic epithets, all bordering on the sinister, that his political rivals like to deploy against him.

When such hyperbole reign, they have a way of backfiring when angry youth come face to face with the supposed subject and discover, to their chagrin, little more than a bumbling old guy with some diminished fire in his bones.

And let’s not forget the millions of Nigerians with disabilities: they may have gotten one of their own, ear-wise, in Aso Rock already.

5. Will Buhari ever make a great inspirational president?

No. He will always be a transitional bridge to somewhere – if we make the destination ever – or a transitional bridge that led back

away from somewhere that we shied away from because the price seemed too great to pay. Reason: he is incapable of articulating any great vision involving more than two or three of the policy realms that Nigeria require its President to straddle to really let fly. Problem is: none of the well oiled rival mouths campaigning right now against him seem to care too for such a highfalutin vision that can be transliterated into multiple indigenous brainwaves and still retain its essentials when it re-emerges in the lingua franca. Voting out Buhari is what the majority of Nigerians hear from them. The Prof and the Madame sound syrupy and practiced. The Sahara guy sounds like today’s Lake Chad water-wise (he would need to convince that there is enough water wherever to divert to graze his fattened policy cows). The Atikulated project daily looks like an articulated vehicle at a round-about, Fela the brand exponent is beginning to sound like Fela the Afro-Juju exponent when he speaks 2019 policy. And that may be the tragedy of this election: Nigerians may resign to not having a great President – just one with some convictions, even if very narrow or selective convictions.

That is, except some candidate finds the matches to self-combust into something special this late in the game. And if Buhari wins again, the emergent government would need to find the inspirational hub/ personality to unite the country or it could even be harder to govern the second time around. And that would not be good for Nigeria.

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Tesla and disruption of Nigerian energy space

S

ince BusinessDay broke the news of United States electric carmaker’s plan to introduce batteries that can power homes and businesses on a large scale, there have been apprehensions and noticeable anxiety by mostly the distribution companies (DisCos) in Nigeria over what their fate could be especially considering their dangerous financial situation bordering on insolvency.

A key concern is the ambiguity over whether the DisCos have exclusivity over their franchise areas.

Last year, two power DisCos [the Enugu Electricity Distribution Company (EEDC) and the Eko Electricity Distribution Company (EEDC)] took up arms against what they deemed violation of their territorial rights. This followed the sector regulator’s (the Nigerian Electric Power Regulatory Commission, NERC,) granting of licenses to operate off grid and independent power plants in Ariaria market, Aba, Sabon Gari Market in Kano, Somolu

Printing Community and Sura Shopping Complex, Lagos.

While the DisCos maintain they have exclusivity over their areas of operation, the minister of power, works and housing, Babatunde Fashola and NERC have maintained that they do not have exclusivity over their franchise areas, a situation that creates room for competition in the sector. Of course, the DisCos, precisely, Enugu DisCo has headed to court to seek interpretation over the matter.

The main concern of the DisCos is that once their monopoly over their service areas are broken, Tesla and other competitors can easily lure away their choice customers, especially as Tesla, with its superior product offerings, seeks to focus on industrial and high end customers who pay higher electricity bills. The company is said to be mulling providing batteries with a capacity of between 1Kilowatt hour to 1MW, capable of powering an industrial complex or an industrial estate, or between 10,000 to 100,000 homes.

Most or all of the eleven DisCos have been performing very badly financial-

ly and are on the verge of bankruptcy. Between October and December last year, for instance, the 11 DisCos collected from consumers only 65 percent of the value of electricity sold but remitted back to other operators only 33 percent of what they collected, according to the third quarter report released by NERC. We need to restate that the original intention of government in privatising the sector and selling the 11 Discos to core investors is on the understanding that the investors will invest in grid and network expansion and renewal. When the distribution companies took over the assets, they made commitments regarding grid expansion, number of new connections and capex to be spent on meters.

H o w e v e r, t h e D i s c o s have violated the agreement reached with the government. They have failed to deliver on all accounts.

According to the BPE, DisCos have only succeeded in metering 10 percent of electricity customers. It emerged they all do not have the capital requirements to invest in the grid and network expansion. All

they are concerned about is recouping their investments and making profits – and the supposed exclusivity clause is key to their remaining in business. Their failure has created a vacuum both the government and businesses are now desperate to fill.

The fault though is not all that of the DisCos. The government that is adjudging them to have failed has also curiously prevented them from selling electricity to the public at market prices.

Without this, the DisCos are unable to secure financing to invest and improve the grid.

Power is a critical and indispensable enabler in the modern world. Citizens must find power one way or the other. Provision of power is a basic obligation of government.

While we commend the government for breaking the monopoly of DisCos and inviting other willing investors into the sector, we also call on government, as a matter of fairness, to remove the restrictions placed on DisCos from pricing power at market prices. The goal is to ensure competition in the space and ultimately power to Nigerians.

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CITYFile

NDLEA arrests 20 illicit drug traffickers in Anambra

T

he National Drugs Law Enforcement Agency (NDLEA) has arrested 20 suspected illicit drug dealers in Anambra, according to Sule Momodu.

Momodu, spokesperson of the state command told a news briefing in Awka on Tuesday that the arrest followed intensive raid of black spots across the state by officers and men of the agency ahead of the 2019 general elections.

He said that the raid became imperative due to revelations that some politicians usually induced thugs with illicit drugs to engage in violence during polls.

Momodu, however, warned politicians in the state to shun acts capable of promoting violence during the forthcoming elections. He said that raids on black spots in the state would continue until all the drug dealers and users were apprehended.

According to him, the agency is determined to ensure effective security arrangements before, during and after the elections.

Momodu gave an assurance that all the suspects caught in the various raids would be arraigned in court.

“Investigations and other details will be made public on the quantity of drugs recovered,” he said.

Driver bags 18 months

A

Jos Upper Area Court sitting in Kasuwan Nama has sentenced a truck driver, Kabiru Saidu, to 18 months’ imprisonment for cheating the truck owner.

The judge, Suleiman Lawal, convicted Saidu, 45, who pleaded guilty to failure to remit proceeds of the truck usage.

Lawal, however, gave an option of N20,000 fine to the convict, and ordered him to pay N500,000 as compensation to the owner of the truck, Adams Adams.

The prosecutor, Ibrahim Gokwat, had told the court that Alims, who resides at Febuna Street, Jos, reported the case at the Laranto Divisional Police Station, Jos, on January 11.

He said Alims gave the articulated vehicle to the convict in October 2018 for commercial purposes and to remit a sum from each trip.

Gokwat said that he convict damaged the truck’s engine, tracker and five brand new tyres, all worth N2,473,000.

He said that during police investigation, the convict said that he could not work with the truck because it had a mechanical fault.

The prosecutor noted that the offence contravened Sections 297, 309 and 323 of the Plateau State Penal Code of Northern Nigeria.

Main entrance of The Polytechnic, Ibadan under lock and key as members of academic and non academic staff begin another round of strike due to non-payment of salaries by government.

NAN

Man kills wife, children, 4 others in Ebonyi

T

he police in Ebonyi have arrested a man believed to be mentally unstable, for allegedly killing his wife, two children and four other members of his community in Ebonyi.

Spokesperson of the police in Ebonyi, Loveth Odah, who confirmed the weird occurrence, said that the incident was first reported to the police on January 21, at 2.00 p.m.

The suspect, according to Odah, is a native of Onyikwa community in Ebonyi local government area of the state.

“The councilor representing the community, Friday Nwigube, reported to the

police that an insane man, name was inflicting machete cuts on members of his community.

“A combined team of detectives rushed to the community where they found several persons with deep machete cuts and rushed them to the Federal Teaching Hospital (FETHA), Abakaliki.

“Seven of them were confirmed dead on arrival at the hospital while four others are in a critical condition,” the police spokesperson said.

Odah added that police detectives together with some youths in the community thereafter began their manhunt for the suspect. She solicited the support

of members of the public to supply the police with useful information that would lead to the arrest of more suspects. “ The police cannot completely eradicate crime in the society. We can only strive to reduce it to the barest minimum. Cases of insanity are not a one-person’s business; communities should send such persons to psychiatric facilities,” she said.

It would be recalled that a similar incident occurred in Ishielu local government area of the state where a woman also suspected to be suffering from mental disorder killed a fellow woman and burnt houses in the community.

Pipeline vandalism: Navy nabs suspected kingpin JOSHUA BASSEY

T

he Nigerian Navy has nabbed one Shaibu Ogunmola, a suspected leader of a gang which specialises in oil pipeline vandalism in Lagos and its environs.

The suspect was arrested by the operatives of ‘Operation Awase, a squad inaugurated by the Nigerian Army in collaboration with the Navy in 2014 to tackle vandalism of the pipelines and other oil facilities in Majidun area of Ikorodu and other parts of Lagos State.

The squad in the last five years has helped to reduce incidence of pipeline vandalism especially in around Ikorodu as well as aided the security of host communities of oil facilities.

Obed Ngalabak, a rear admiral and leader of the operation, spoke on the arrest, said that Shuaibu and his gang members were known for vandalising oil pipelines under the Altas Cove covering about 70 kilometers.

The Atlas Cove Depot in Lagos is designed to receive imported petroleum products and

through the line products are distributed to various part of the country.

Shuaibu and his men were said to be operating around Ilashe community with drums buried around the pipelines into which they siphoned products when being pumped from the Atlas Cove to other depots.

“Two weeks back, we got information about the operation of some people in Ilashe, part of Atlas cove.

“Following that information, we came and saw that the oil pipelines have been divided into fields by three people, Shuaibu, Barshiru and Dele.

“The arrest of Shuaibu which was effected on January 17 was in line with the Operation Awase which is about the protection of oil pipelines.

“He is the ring leader and has been in this business for over 30 years,’’ he said He added that Shuaibu trained some boys in the business and that his arrest would bring an end to the era of pipeline vandalism in the affected area.

According to Ngalabak, the arrested suspected would be handed over to relevant

agency for immediate and proper prosecution to serve as a deterrent to his boys and others in the line of business.

“We hope that Shuaibu’s arrest will yield result and that proper people in position will do all that is required to punish him,’’ he said.

He assured that the operation would not rest until all those involved in oil pipeline vandalism were arrested and brought to book.

He said: “We still have about three Shuaibu’s, we have Dele, we have Bashiru, and one other person and we are after them. We are not going to rest until we get them, except if they leave Nigeria but we will make sure that we get them.

“And we know that they will not leave because this is where they make their money; but if they leave here, that is good for us because that is our aim but if they come back, we will get them,’’ he noted.

The naval boss, however, sought for better logistics for their operations and called on Nigerians to support their effort towards curbing pipeline vandalism for economic growth and development in the country.

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BUSINESSTRAVEL Use of Turbo-props will reduce operational costs, charter prices – Okwa Harold Okwa is the managing director for Jetseta, one of Nigeria’s leading private jet providers. In this interview with Ifeoma Okeke, he speaks of the growth of private jets and charter operations in Nigeria and prospects for expansion.

Have you observed any increase in patronage for your charter services in Nigeria since 2016 to 2018? es, we have experienced an increase in charter services right from the 4th quarter of 2018.

We initially had about 50 business jets in the country around 2016, this had gone up to around 80 to 90 business jets by my estimates.

If so, do you think this increase may have been driven by the recent election campaigns in Nigeria or just that people now prefer charter services to scheduled commercial operations?

I think both reasons have played a big role in the increase in charter services. Firstly, due to the campaigns, a lot of the time slots for commercial airlines do not fit in well with the campaign rallies, and as such, various parties have to make alternative arrangements to ensure that the rallies can go on as planned. Second reason is due to the increased demand in commercial operations, as more people demand their services, this has created a lot of pressure for the operators, and resulted in delays, cancellations, among others. As a result, passengers who are “cash rich and time poor” are forced to make other arrangements, to ensure their plans do not suffer.

Have there been more operators coming into charter services recently?

Y

Harold Okwa,managing director, Jetseta.

Certainly, the number of aircraft in country has increased, as for operators this has not increased as much, because of the time lag in new operators to get operating licenses What has sustained your operations in Nigeria since you commenced?

I think the shared charter ‘sin-

gle seats’ is what has sustained our operations. This has helped to democratize private flights to allow more users. It has created a niche of users who are time sensitive and can’t stand delays or cancellations.

How long have you been in Nigeria and can you tell us the services you offer?

Jetseta is a virtual airline company creating access to private aviation and helicopter shuttle services, whether it’s a complete charter by an individual or individuals sharing an aircraft to a common destination. We do our best to meet our client’s needs.

Who are your target markets?

Simple, we focus on client’s who are time poor and have the means to pay for a private flight.

How do you source for crew and pilots for your operations in Nigeria?

We try not to get involved with the operational side of the business. What we do is mainly work with aircraft owners who already have their crew. Our main focus is to help them utilize whatever spare capacity they may have.

Do you think the market has seen significant improvement since five years? Why? The market has seen a good level of improvement over the period we have been around, especially when it comes to potential customers getting more access to information on aircraft, charter rates and options to meet clients’ needs in general. This is mainly because a lot of companies like Jetseta have come into the space to provide significantly more information on service and value proposition. Saying this, I would still stress that there is loads and loads of room for improvement in the business aviation space.

What has the journey been

like for you since you commenced operations in Nigeria and what are the potentials for growth and expansion?

I would say the journey thus far has been very interesting. A lot of the times we have had to revise our expectations and be very flexible to compete in the Nigerian aviation climate. The potentials are still very large and untapped. One good area would be to change both customer and operator mindset to encourage the use of Turbo-props. This would help drive down operational costs, and subsequently charter prices.

This would ultimately help drive growth and expansion.

What are the challenges of operating charter and private jet operations in Nigeria? And how can they be navigated?

There are a number of challenges. One of the major ones is the perception that charter and private jet operations are a luxury.

This may not necessarily be the case, as a lot of the time our operations are aimed to meet greater efficiency than commercial airlines especially in allowing business people access the most remote areas, which commercial aviation may not allow them to effectively access. We hope to navigate this challenge purely by educating and giving potential clients more information on our services and the advantages of private charters especially as it relates to opportunity cost.

Why Nigeria should review all its Bilateral Air Service Agreements with other countries IFEOMA OKEKE

B

ilateral Air Service Agreement (BASA), are founded on the principle of reciprocity. It is a deal that enables a country’s airlines to enjoy equal leverage, in terms of flight operations, in countries with which their home country has an air agreement.

Nigeria signed a Bilateral Air Service Agreement (BASA), with the Republic of India on January 14 this year. It stipulates that passengers being processed from Nigeria would enjoy direct flight to India as a result of the agreement.

As at 2018, trade volume between Nigeria and India hit $12billion driven primarily by medical tourism and crude oil. This agreement was therefore signed to facilitate easy movement of people, goods and

services between the two countries.

It is in the light of these Nigeria needs to find out what went wrong with previous air agreements it signed with other countries and why they are not delivering value before it signs more.

No matter how juicy a BASA agreement may seem between two countries, these agreements must be signed on the basis of reciprocity or else the country on the other end may be shooting itself on the foot.

Domestic airlines operating in Nigeria have continued to lose out in revenue and flight frequencies, while foreign airlines are increasing and opening more routes in Nigeria after BASA with some countries.

The Single African Air Transport Market, (SAATM) which is part of the BASA agreements is a flagship project of AU Agenda 2063, which aspires to create a single unified air transport market in Africa, liberalise

civil aviation in Africa, and motivate the continent’s economic integration agenda.

The agreement has seen more foreign airlines such as Sudanese airlines, Ethiopian airlines, RwandAir, Emirates open more routes and increase frequencies in Nigeria, while Nigeria airlines suspend operations into foreign countries.

Nigeria currently has 24 foreign airlines operating in the country and most operate in Lagos, Abuja, Port Harcourt and Kano, while only two Nigerian carriers, Arik and AirPeace currently flies into or from West African countries.

Few months ago, the Federal Government approved two Sudanese airlines - Badr Airlines and Tarco Airways to operate into Kano. The two airlines are currently operating two flights weekly from Khartoum, Sudan to Kano.

Ethiopian Airlines has gradually

evolved to become a Nigerian indigenous carrier as it presently flies to four destinations in the country from its base in Addis Ababa.

The East African carrier operates scheduled flight operations to Murtala Muhammed International Airport, MMIA, Lagos; the Nnamdi Azikiwe International Airport, NAIA, Abuja, Aminu Kano International Airport, AKIA, Kano and recently, Akanu Ibiam International Airport, Enugu with over 21 frequencies weekly.

Apart from Ethiopian Airlines, other foreign airlines like RwandAir, British Airways, Etihad, Air France/ KLM, Egypt Air, Emirates and South African Airways among others have joined the bandwagon of carriers that operate multiple entries into Nigeria regularly without reciprocity from any of the nation’s carriers.

On the other hand, Medview, a Nigerian carrier which flew into

Dubai and London has suspended operations into these countries because the airline did not have adequate operational aircraft to sustain the routes.

Arik Air which flew London, Johannesburg-South Africa and almost all countries in West and Central Africa suspended operations into these countries because of its huge debt to its foreign partners.

AirPeace, is still in the process of getting certifications from the Nigeria Civil Aviation Authority (NCAA) and the countries it intends to fly into.

While foreign countries have continued to burden Nigerian carriers with obnoxious demands, making it almost impossible for domestic airlines to operate, federal government continues to give more frequencies to foreign airlines.

Domestic carriers say this agreement is slowly killing their operations and benefiting the foreign carriers.

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First Bank upgraded to hold at HSBC, target price N7

Pg. 16

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

OIL & GAS

Total to go ahead with Ikike Oil Project in Nigeria OLUFIKAYO OWOEYE

A

fter the success recorded with the Egina project, French o i l g i a n t , T O TA L s a i d it will approve plans to proceed with the Ikike field development offshore Nigeria in the coming months.

According to Reuters, Patrick Pouyanne, CEO o f To t a l r e v e a l e d t h i s while speaking on the s i delines of a meeting of Nigerian and French businesses in Paris where he also revealed plans by the oil-giant to expand its Nigerian LNG project this year.

“There is a huge potential in Nigeria, it is probably the most prolific country in West Africa in terms of oil and gas and it is time to launch new projects and we are working on many of them,” Pouyanne told journalists.

The 60,000 barrels-perday (bpd) Ikike project is one of several projects the group has earmarked in Nigeria for a Final Investment Decision, (FID) including the 70,000 bpd deepwater Preowei project, which would help

Total increase its oil production in the country. “ The market is ver y good today to do that, it is a very interesting project and the partners are in line to develop it... 2019 should be the year of expanding Nigeria LNG,” he added.

The Ikike field is located in the OML 99 license o f f s h o re Nig e r i a, w i t h Total being the operator with a 40 percent stake.

The project is expected to be developed as a tieback to Amenam (5 wells) platform.

The CEO of Total further called on the government to issue new exploration licences, noting that the country’s oil and gas sector had been dormant in recent years in terms of exploration and new projects due to uncertainties and the ongoing discussions over Niger i a’s o i l industry regulation bill.

“I hope the new government that will come after the election will launch new tenders for awarding new exploration licenses,” he said.

Total started production at the Egina-Total S A’s $ 4 b i l l i o n F l o a ting Production, Storage and Offloading (FPSO)

vessel off the coast of Nigeria this month.

At 330 meters (1,080 feet) long, it’s the largest FPSO ever built by the French major and it w ill operate fur ther

offshore and in deeper waters than anyone else has tried so far in Nigeria -- a sign of growing confidence in the technology required to operate such assets. Egina

is the first offshore field t o s t a r t p ro d u c t i o n i n Nigeria since Exxon Mobil Corp.’s Usan in 2012.

Ni g e r i a i s c u r re nt l y pumping just over 2 million barrels of oil a day

and it plans to roughly double that by 2020, a target that could prove difficult to achieve given delays that often occur in previous developments.

FINANCIAL INCLUSION

Jaiz Bank relaxes account opening requirements in financial inclusion push ISRAEL ODUBOLA

T

he Managing Director/Chief Executive Officer of Jaiz Bank, Hassan Usman says that those who lack access to financial services would be allowed to open account without meeting certain requirements including Know Your Customer (KYC), presentation of utility bills and valid identification card amongst others.

This development is in accordance with the

bank’s commitment to widen financial inclusion to unbanked population that lacks access to its financial services.

“These people don’t have that these requirements but the policy allows us to open accounts at that level,” Usman said.

The accounts would be opened as financial inclusion accounts and would be upgraded to the next level, he said.

“What we are trying to do is to use channels such as agency banking, our own branches and other digital av-

enues to allow as many people come on board and we would also empower them with little credit”, he added.

This new policy is expected kick off in Kastina and focus would be placed on female entrepreneurs and other micro businesses, and once it yields positive outcome, it would commence in other locations.

“We are aggressive in this area of financial inclusion. Our experience with the pilot so far is exiting because people like to be sup-

ported. The only challenge is in convincing beneficiaries that the money is not free, that it will have to be repaid. Everyone would like to be supported financially,” he said.

Speaking at the National Financial Literacy Stakeholders’ Conference in Abuja recently, he stated that the bank being a product of the financial inclusion policy would continue to provide non-interest banking to prospective customers in a bid to expand the coverage of financial services to

the masses.

He said the financial institution had been part of the process of ensuring financial inclusion through agency banking and use of technology to reach the unbanked population.

In what signals as positive development towards the quest for financial inclusion, The Financial Inclusion Sur vey conducted

by Enhancing Financial Innovation and Access (EFInA) last month, disclosed that financial inclusion rate rose to 63.6 percent in 2018 from

Edited by LOLADE AKINMURELE (loladeakinmurele@gmail.com) Graphics: CHINEDUM ONYEMA

45.4 percent two years earlier.

The survey further unveiled that 63.3 million of Nigeria’s adult population of 99.6 million, have access to financial services, while 36.8 percent, which equalled 36.6 million are financially excluded.

The revised National Financial Inclusion Strategy aims to reduce the proportion of adult Nigerians that are financially excluded to 20 percent in the year 2020 from the baseline figure of 46.3 percent in 2010.

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COMPANIES & MARKETS APPOINTMENTS

United Capital appoints Onakpoma as new CFO SEGUN ADAMS

U

nited Capital, a financial and investment services provider, has announced the appointment of Shedrack O nakpoma as its new Chief Finance Officer (CFO).

The appointment which took effect on January 15, 2019 followed the resignation of Odiri Oginni who had served in the capacity since April of 2018, after a 7- month period as acting Group CFO from October 2017 to April 2018. ’United Capital Plc. wishes to inform the Nigerian Stock Exchange and the Company’s esteemed shareholders of the appointment of Shedrack Onakpoma as the Group Chief Finance Officer’’ the company stated in the notice filed on the NSE, Tuesday, 22 January 2019.’’ The appointment was necessitated as a result of the resignation of Odiri Oginni, the Group Chief Finance Officer.’’

Shedrack Onakpoma, a graduate of Economics from Olabisi Onobanjo University, Ogun State is a Fellow Chartered Accountant, an Associate Licensed International Financial Analyst (LIFA) and a Certified Balanced Scorecard Professional.

Prior to his current appointment, Shedrack spent about 5 years with Union Assurance as a Principal Manager, and Head of Accounts and Strategic Management Office. There, as a Management Staff, He Implemented the Balanced Scorecard and transited the Company from Local GAAP to IFRS, successfully.

Thereafter, he moved to Industrial and General Insurance Company Plc (IGI), as Assistant Manager and rose to the position of CFO, Industrial General Insurance, Ghana (A subsidiary of IGI Plc, Nigeria) after a stint with Nigeria Wire Industry Plc (One of the foremost Nail Manufacturing Company in West Africa) where he rose to the position of an Assistant Manager.

More recently, he was Chief Finance Officer at Heirs Insurance Limited, a privately held investment firm founded and chaired by Tony Elumelu, for a period spanning a little over 3 years since he occupied the office in November of 2015.

Thus, Shedrack brings to United Capital years of vast exposure in Financial Management, Business Planning, Mergers & Acquisition, Business Combination and Restructuring within West Africa and

MARKETS

H

SBC analyst Aybek Islamov has upgraded the recommendation on FBN Holdings Plc to hold from reduce.

The Price Target was raised to N7 from N6.90, implying a 4.1 percent decrease from last close.

FBNH average PT is NGN11.66 from 15 analysts that cover the stock. FBNH had 13 buys, 1 hold, 1 sell previously.

Analysts have lowered their consensus one-year target price for the stock

East Africa.

Results for nine months to 30 September 2018 showed a decline of some 4 percent in the group Gross earnings which fell to N5.97 billion in 2018 from N6.24 in corresponding period of 2017.

Net Operating Income in similar fashion fell by 11.47 percent from N5.48 billion in 2017 to N4.85 billion in 2018.

Revenue for 9M:2018

was down by 4.31 percent to N5.97 billion in 2018 compared to N6.24 billion reported in 2017.

Similarly, Profit before tax (PBT) for nine months in 2018 was down to N3.67 billion, 5.8 percent lower than N3.9 recorded in corre sp o n d i ng p e r i o d i n 2017.

Although tax expense declined from N623.5 million to N587.2 mil-

lion, profit pared by 5 percent from N3.08 billion in 9M:2017 to N3.27 billion in corresponding period of 2018.

Shares of United Capital closed 2.76 percent higher than it opened for the year at the close of trading on Monday, 21 January, after plunging from N3.22 recorded on the 15th of January 2019, its highest trading price since at least, July

of 2018 where it traded higher.

United Capital, formerly referred to as United Bank Capital (UBCAP), is a financial and investment services company with focus on investment banking, asset management, trusteeship, securities and insurance. The firm was incorporated on March 14th 2002 and listed on November 1st 2013.

TECHNOLOGY

First Bank upgraded to hold at HSBC, target price N7 ENDURANCE OKAFOR

L-R;Nancy Nwachukwu, head, marketing communications; Jason Du, deputy operations manager; Adedotun Adegbite, business development manager, and Elvis Subor, marketing specialist, all of Scooper Nigeria , during the Scooper Press Launch in Lagos.

Pic by Pius Okeosisi

by 0.8 percent in the past three months and the forecasts range from N4.74 to N17.81.

In the past six years and four months, HSBC has rated FBNH reduce three times, hold twice, underweight three times and neutral three times.

The shares rose an average 14 percent in the periods rated reduce, fell an average 4.5 percent in the periods rated hold, fell an average 8.3 percent in the periods rated underweight and rose an average 0.9 percent in the periods rated neutral, according to Bloomberg data.

Kobo360 expands operations to Togo IFEOMA OKEKE

A

s part of its continentwide expansion drive, technology enabled logistics company, Kobo360, which raised $6 million from World Bank IFC in December 2018, is expanding operations into Togo.

The team led by its co-founders will be in Togo’s capital Lomé from the 23rd to 26th of January, 2019.

“This is part of our expansion across Africa which has been

in effect since 2018,” Obi Ozor co-founder explained.

“Our mission is to build the Global Logistics Operating system that will power trade and commerce across Africa and emerging markets; Togo is a key part of that drive” Ozor added.

The start-up founders will be meeting with government officials and partners in the West African nation as well as interview hundreds of applicants to fill several open positions in the com-

pany’s Lome branch.

The roles to be filled include operations, business development, customer development, technology and others. The company will be making a foray into the Ghanaian & Kenyan market in the following weeks.

Kobo360 is a techenabled logistics platform that aggregates end-to-end haulage operations to help cargo owners, truck owners, drivers, and cargo recipients to achieve an efficient supply chain frame-

work. Through an allin-one robust logistics ecosystem.

Kobo uses big data and technology to reduce logistics frictions while empowering rural farmers to earn more by reducing farm wastages and helping manufacturers of all sizes to find new markets.

Kobo enables unprecedented efficiency and cost reduction in the supply chain, providing 360-visibility while delivering products of all sizes safely, on time and in full.

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TELECOMS

Glo, Nokia Alcatel-Lucent sign new deal SEGUN ADAMS

F

ully integrated telecommunications solutions provider, Globacom, and global telecom equipment company, Nokia Alcatel-Lucent, have signed a multi-million dollar for the supply of a new platform to enhance service experience of subscribers on the Glo network.

The Executive Vice Chairman (EVC) of Globacom, Mrs Bella Disu, announced the partnership at the *2019 Choose France* International Business Summit which took place at in France on Monday.

She explained that Nokia Alcatel-Lucent would under the deal supply, install, and integrate a new Sure Pay Intelligent Network platform that would significantly improve service delivery on the Glo network.

The EVC also disclosed a second contract which the company signed with Vocalcom Technology, another French company, to enhance Globacom’s Interactive Voice Response and Contact Center Solutions. She presented a Purchasing Order (P.O.) to Vocalcom to give effect to the deal.

“These agreements are geared towards ensuring that Globacom continues to

provide first-rate telecommunications services in the countries where we operate,” Mrs. Disu said.

She had also joined other global chief executives including Alike Dangote, Tony Elumelu, and the Chairman/ CEO of Total, *Patrick Pouyanné, * for a meeting with the French President, Mr. Emmanuel Macron, at a dinner organised to promote France’s attractiveness as a business environment. The various global CEOs used the Summit to publicise major investments and partnerships involving French companies.

Disu also attended the first meeting of the France-Nigeria Investment Club which President Macron launched when he visited Nigerian in 2018.

Speaking in an interview, Disu described her engagements with world business leaders in France as highly significant as the summit provided a veritable opportunity to pursue areas of partnership with other countries and businesses.

“We have long chosen France, and we welcome every opportunity to expand our interests and alliances here”, the Globacom EVC stated.

The Mike Adenuga Group is known for its strong ties with France. Globacom and Conoil Producing Limited have had over a decade of

strong business relationships with French companies, including Total and Alcatel, which is now Nokia AlcatelLucent. The group of companies also supports the principal international French cultural organisation, Alliance Francaise, in Lagos. During his state visit to Nigeria last year, the French President commissioned the state-of the-art Mike Adenuga Alliance Francaise Centre donated by the Globacom Chairman, Dr. Mike Adenuga, to promote French and Nigerian cultures in Lagos.

“This email, together with any attachments, is for the exclusive and confidential use of the address(es) and may contain legally privileged information. Any other distribution, use or reproduction without the sender’s prior consent is unauthorized and strictly prohibited. If you have received this message in error, please notify the sender by email immediately and delete this message from your computer without making any copies.

Globacom is a Limited Liability Company with registration number 439916 and address at Mike Adenuga Towers, 1 Mike Adenuga Close, Off Adeola Odeku, Victoria Island, Lagos, Nigeria. Globacom Limited is registered to deliver

L-R: Wole Fagbola, sales director, GSK; Kunle Oyelana, marketing director, GSK; Bhushan Akshikar, MD, GSK; Sam Ohuabunwa, president, PSN; Emeka Duru, national secretary, PSN, and Omongiade Ehighebolo, director, communications and government affairs, GSK; during a courtesy visit by GSK Nigeria to Pharmaceutical Society of Nigeria (PSN) in Abuja.

L-R: Frank Edozie, MD/CEO, Neconde Energy Limited; Nnenna Obiejesi, group executive director, Obijackson Group; Chizor Malize, CEO, Brandzone Consulting LL, and Ikeazor Okonkwo, chief financial officer, Nestoil Limited, at the Brand Innovation Workshop organized by Brandzone LLC recently in Lagos.

APPOINTMENTS

EFInA appoints Esaie Diei as CEO BALA AUGIE

E

FInA (Enhancing Financial Innovation and Access) is pleased to announce the appointment of Esaie Diei as its Chief Executive Officer. In this capacity Diei will be responsible for leading EFInA and ensuring that the organization continues to advance on its mission of facilitating the emergence of an all-inclusive and growth-promoting financial system in Nigeria.

Diei brings a deep experience of working at senior level in financial inclusion and in financial markets; strong relationship management experience with the ability to effectively engage with diverse stakeholders; and a strong understanding of the operation, challenges, technical and political context of the Nigerian financial system.

Esaie’s has over 30 years professional experience in management, product development, marketing and digital innovation. He is an alumnus of ESCA (Ecole Superieure de commerce d’Abidjan), a highly rated Business School in Cote d’Ivoire in partnership with the University of Brighton

(United Kingdom).

Diei began his career at IBM in 1998 as a sales manager before moving to United Bank of Africa (UBA) in 1999, as Head, Card & Payments.

In 2009, he was appointed Group Head, Prepaid Card Business and in this capacity he played an important role in UBA’s digital banking transformation. Esaie took up an appointment with Globacom in 2014 as Group Head, Mobile Financial Business and led the company’s digital transformation in mobile payments. In 2017, he was appointed the CEO, MoneyMaster Limited, a Globacom subsidiary focused on digital financial business.

Esaie Diei has made substantial contributions to the development of financial inclusion in Nigeria particularly through his work on the Central Bank’s Committee set up to develop the regulatory framework for licensing Super-Agents where he served as Vice Chairman. He was one of 40 Digital innovation experts from Africa selected by the Consultative Group to Assist the Poor (CGAP) in 2011 to participate at a gathering in Washington DC called to

examine the challenges and opportunities which existed in promoting financial inclusion through innovation.

Commenting on the appointment, Segun Akerele, EFInA’s Board Chair said; “Esaie has the right mix of experience in leadership, digital innovation and management needed to lead the next phase of EFInA’s growth. We are happy he has agreed to join us as he shares the values and aspirations of this company and its donors. On behalf of the Board of Directors, I wholeheartedly welcome Esaie to EFInA and wish him every success’.

In response Diei stated that ; “I am excited to join this wonderful team of highly driven individuals who are investing their skills and efforts in advancing access to financial services and opportunities for the poor in Nigeria. I am confident that working together with our stakeholders we will be able to achieve our goals and meet Nigeria’s Financial Inclusion targets by 2020.”

EFInA is funded by the UK Government’s Department for International Development (DFID) and the Bill & Melinda Gates Foundation.

L-R: Pearl Uzokwe, director, governance and sustainability, Sahara Group, and Oscar Onyema, chief executive officer, Nigerian Stock Exchange, during an interview with AsharamiTV, a Sahara Group thought leadership platform at the ongoing 2019 World Economic Forum in Davos, Switzerland.

L- R: Adams, principal, Estate Senior Grammar School; Seyi Soetan, senior coverage executive, Rand Merchant Bank Nigeria, and Adesanya, vice principal, Academics at the Estate Senior Grammar School 36th annual inter-house sport competition sponsored by Rand Merchant Bank Nigeria.

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In association with

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

Market capitalisation

NSE Premium Index

The NSE-Main Board

NSE ASeM Index

2,165.23

399.27

793.81

Week open 11 – 01–19)

31,070.0 29,830.70

N11.721 trillion

N11.124 trillion

2,043.32

1,387.35

792.45

Week close (18 – 01–19)

31,005.17

N11.562 trillion

2,166.93

1,419.50

792.45

Year Open

Percentage change (WoW)

3.94

Percentage change (YTD)

-1.35

-6.05 -1.28

NSE Lotus II

NSE Ind. Goods Index

NSE Pension Index

300.24

2,218.37

1,222.99

1,201.80

704.73

281.01

2,152.61

1,194.35

1,170.69

723.87

282.68

2,289.62

1,346.18

1,194.83

NSE Banking Index

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

1,399.64

399.27

124.82

1,343.94 1,378.95

383.50

115.97

379.51.

122.36

NSE 30 Index

-2.32

0.00

-2.61

-1.41

-0.17

-2.70

-1.04 -4.87

731.57

5.51

2.72

-3.326

-3.33

0.59

6.32

12.71

2.06

-6.47

-2.49

8.75

-1.05

Stocks trading on NSE tilts towards oligopoly market

…deals flow determined by only 5% of active brokers HEANYI NWACHUKWU

E

quities trading on the Nigerian Stock Exchange (NSE) finally skewed towards an oligopoly market where a few active firms dominate and control deals flow.

INVESTOR checks month-onmonth (MoM) have revealed that only 10 dealing member firms which repres ent 5.10percent of the entire 196 active dealing members​​ accounted for stock trading valued at N1.633trillion in 2018.

This value of stocks traded in the twelve months to December 31 represents 67.89percent of the total value of stocks traded on the NSE in 2018.

In the review period, all the 196 dealing member firms exchanged equities valued at N2.404trillion. In terms of volume, only 10 dealing members exchanged 95.158billion units which represents 46.90percent of the entire stocks exchanged last year on the Bourse.

Top on the list of deal makers (value) as shown as shown in the Broker Performance Report are: Stanbic IBTC Stockbrokers Limited (N466.53billion or 19.38percent); R e n c a p S e c u r i t i e s ( Ni g e r i a ) Limited (N290.447billion or 12.07percent); CSL Stockbrokers Limited (N238.865billion or 9 . 9 2 p e rc e n t ) ; E F C P L i m i t e d (N218.841billion or 9.09percent) and FBN Quest Securities Limited (N123.793billion or 5.14percent).

Others are: Chapel Hill Denham Securities Limited (N85.471billion or 3.55percent); Cardinalstone

Securities Limited (N57.656billion or 2.40percent); Cordros Securities Limited (N55.266billion or 2.30percent); United Capital Securities Limited (N51.902billion or 2.16percent); and Primera Africa Securities Limited (N45.197billion or 1.88percent).

This trend may have come to stay using available indicators at the Nigerian Bourse, but it should be a source of concern to other active dealing members and the E xchange which ser vices the largest economy in Africa and is championing the development of

Africa’s financial markets.

In terms of volume of stocks traded last year, Stanbic IBTC Stockbrokers Limited led others after accounting for 17.002billion units, which represents 8.38percent of the total volume of stocks traded.

United Capital Securities Limited followed with 14.625billion units or 7.21percent; CSL Stockbrokers Limited (14.281billion units or 7 . 0 4 p e rc e n t ) ; C a rd i n a l s t o n e Securities Limited (10.834billion units or 5.34percent); and R e n c a p S e c u r i t i e s ( Ni g e r i a )

Limited (9.143billion units or 4.51percent).

A l s o, A p e l A s s e t L i m i t e d accounted for 6.231billion units or 3.07percent of the total volume of stocks traded on the NSE last year ; Morgan Capital Securities Limited (6.154billion u n i t s o r 3 . 0 3 p e rc e n t ) ; E F C P Limited (5.924billion units or 2.92percent); FBN Quest Securities Limited (5.881billion units or 2.90percent); and Meristem Stockbrokers Limited (5.079billion units or 2.50percent).

Union Bank inaugural Commercial Paper offer opens

T

he inaugural Commercial Pap er (CP) issuance by Union Bank of Nigeria Plc under its N100billion CP Issuance Programme has opened. The proceeds of the Issuance will be for working capital purposes.

The offer for the Series 1 and 2 CPs tenured 90-days and 181-days respectively opened on Tuesday January 22, 2019 and closes on Friday Januar y 25, 2019. The Settlement Date is Tuesday January 29, 2019. Stanbic Ibtc Capital Limited and Standard Chartered Capital & Advisory Nigeria Limited are the joint arrangers / dealers.

The inaugural CP issuance under the Programme follows Union Bank’s first foray into the domestic debt capital markets as the bank successfully issued its N7.2billion, 3-year and N6.3billion, 7-year Bonds due under its N100billion Debt Issuance Programme.

Union Bank is a full-fledged commercial bank with an international banking subsidiary in the United Kingdom. Union Bank is one of Nigeria’s leading financial services organisations, with an asset base of over N1.5 trillion and shareholders’ funds in excess of N290 billion as at 30 September, 2018.

The Bank currently has approximately 4.3 million active customers served through over 300 sales and service centres, over 1,000 active Automated Teller Machines (ATMs) and over 7,800 Point of Sale (POS) terminals strategically located across Nigeria. Union Bank has won numerous awards over the last two years, such as ‘The Fastest Growing Retail Bank’ by International Finance Magazine, ‘ E xcellence in Innovation in Banking’ by New Age Banking Awards and the ‘Brand Evolution of the Year’, ‘Iconic Brand of the Year’ awards by Marketing World Awards.

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Helping you to build wealth & make wise decisions

United Capital Investment Views

Bulls gain ground as NSEASI soars 3.9% w/w

I

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

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

E-mail: iheanyi.nwachukwu@businessdayonline.com

n what seemed like the bulls at the last auction) and 364-day potential return of FPIs are all grabbing the baton from the (15percent versus 14.5percent at positive factors for reserves. bears, the domestic bourse the last auction).

Global Market Review and traded in green territory We expect the renewed Outlook on all five trading days foreign interest that characterized Hopes of a trade resolution of the week and consequently most of last week to be sustained provides a fillip for global gained 3.9percent week-on- this week, considering the fact equities week (w/w) to close well above that most of the risks the market In the past week, the the 30,000points threshold at priced in last year (e.g. US rate WEEKLY performance of global equity REPORT 31,005.0 points. Activity level hikes) are playing out less than the indices was buoyed by further for the week emerged mixed market expected. Nonetheless, indications of a tapering in as average volume traded rose election tensions between STOCK MARKET REPORT JANUARY 18TH 2019 the two uncertainties shouldFORtrade 0.4percent to 254million units provide a cap to any uptrend in largest economies in the world. while average value traded shed prices.

Reports that officials in the US A total turnover of 1.270 billion shares worth N13.463 billion in 16,476 deals were traded this week HEANYIat NWACHUKWU 4.3percent to settle at N2.7billion. were weighing easeshares in valued Lull themein contrast by investorsBond on theMarket: floor of the Exchange to a total ofpossible 1.265 billion A glance at activities across Chinese imports amid N14.074characterises billion that exchanged hands last week intariffs 19,278on deals. sentiments sectors underscored the strength In the bonds space, renewed ongoing discussions ahead of the ongoing The Financial Services Industry (measured by volume) led the activity chart with 1.131 billion shares h e of the bullish run as all sector March deadline and the onset of offshore interest and the valued at N10.573 billion traded in 10,352 deals; thus contributing 89.06% and 78.54% to the total Rights Issue of indices except the banking index Q4-18 earnings season bolstered equity turnover volume and value respectively. The Consumer Goods Industry followed with 37.744 relatively liquid environment million shares worthmoney N1.628 billion in 2,054 The third place Conglomerates closed the week upbeat. The for was US equities with Industry with Lafarge Africa Plc (average market ratesdeals.sentiments a turnover of 37.699 million shares worth N102.918 million in 566 deals.

Industrial Goods (+12.7percent w ill now clos e at 20.9percent compared to notable names such as Bank of w/w) led the gainer’s campTrading on 25.1percent America and Goldman inEquities the preceding in the Top Three namely, Diamond Bank Plc, Guaranty Trust Sachs Bank Plc and onZenith Monday January 28, million shares worth N8.509 in 3,753 Bank Plc (measured bargain hunting in bellwether printing strong earnings growth.billion2019 week) inlightbyofvolume) couponaccounted paymentsfor 696.955 deals, contributing 54.86% and 63.20% to the totalOverall, equity turnover value respectively. as against Saturday DANGCEM (+10.1percent), the volume DJIA, and S&P 500, and the CBN’s NTB repayment Equity helped Turnoverto - Last 5 days CCNN (+25.5percent) and spur some bargain and NASDAQ rose 3percent, January 26, 2019 earlier since Saturday WAPCO (+4.5percent).

2.7percentDeclined w/w announced Turnover Turnover2.9percent Tradedand Advanced Unchanged hunting. Consequently, average Volumesouthwards Value (N)despite Stocks Stocks impasse Stocks is Stocks The Insurance (+5.5percentDateFGNDeals the continued not a business day. bonds trended !"#$%&#!'( )*+")( !,)*"-.*!,'( !*-.+*/'.*',-0+)( '!( !!( !!( /'( w/w), Consumer G oods government shutdown. to close at 15.3percent (versus of the US Dealing Members at the !+#$%&#!'( ,*1/)( ,--*!,,*.-,( ,*)".*)/)*//10,!( !--( )!( !,( //( (+2.7percent w/w), and Oil & Gas Europe, )"( a series !/( of 15.4percent in the preceding !/#$%&#!'( ,*/",( ,-+*.-.*!1'( )*!-)*!1-*/),0/'(In !-)( /)( Nigerian Stock Exchange (+0.6percent w/w) indices also events ''( unfolded ),( with regards week).

Similarly, the average !1#$%&#!'( ,*)!!( ),!*)!/*)"!( ,*)/!*'.1*)).01"( !+( /!( ( N S E) were notified trended northwards w/w as gains Not )!( only was the !.#$%&#!'( ,--*.-"*!!'( !-'( ))( //( yield,*,!.( for FGN Eurobond ,*1/"*.,1*,1/0+!( edged the BREXIT. in CUSTODIAN (+21.7percent), lower from 7.6percent to BREXIT deal, presented to the that Lafarge Africa Plc MANSARD (+3.3percent), obtained the approval GUINNESS (+7.6percent), of the Securities and NESTLE (+3.5percent), Exchange Commission OANDO (+3.5percent) and (SEC) to change the FO (+3.5percent) provided support. The Banking closure date of its Rights (-1percent) index stood as the Issue. lone loser owing to declines In September 2018, the in GUARANTY (-4.6percent), Board of Lafarge Africa Plc ZENITH (-1.6percent) and FBNH (-1.4percent) - barring the approved the refinancing upticks in UBN (+12.5percent), of the shareholder loan to FCMB (+3.5percent) and ETI $293million with longer (+3.7percent).

Investors’ sentiment was 7.3percent while average yield in House of Commons by the British maturity and a Rights upbeat as market breadth corporate Eurobonds decreased Prime Minister, confronted with Issue of up to N90billion. closed at 1.5x (previously 0.5x); to 9.3percent from 9.4percent. the biggest defeat for a British The restructuring is aimed as 37 stocks advanced while 25 There is a better balance of leader in modern history, but at reducing Lafarge Africa declined w/w. In the week ahead, risk for the market as some of the the incumbent government we expect some profit taking to factors that predicated Emerging also was subjected a vote of no- Plc leverage position as trail the observed bullish run & Frontier Market fund outflows confidence which was narrowly well as strengthen its For Further Inquiries Contact: Market Operations Department Page 1 as jitters surrounding the polity profitability. in 2018 seems to be abating. escaped. remains on the horizon.

Lafarge Africa Plc is Nonetheless, the FGN is expected Beyond events in the UK, Money Market: Offshore to float its January bond auction the German economy narrowly currently shopping for inflow drives moderation in this week and we expect the escaped trudging into a recession N89.2 billion from its yields tempo of this event to drive the in 2018 as the country’s statistical The week to 18th January saw direction of average bond yields body reported a 1.5percent renewed offshore interest in the during the week. expansion, its weakest in five market following the significant Foreign Exchange: FX rates years. Amid the political drama rise in turnover at the I & E FX appreciate across market that unfolded, equity indices window to the tune of $1.7billion segments found solace in the broader global (compared to N945.5million In the Foreign exchange equity uptrend. Hence, the Panin the preceding week), with a market, the local currency European STOXX (+2.2percent), corresponding compression in strengthened against the dollar Germany’s DAX (+2.9percent), rates to a 4-Month lowof N362.8/$. across the 3 windows we actively France’s CAC (+2percent) and Consequently,averageyieldonthe track; up by 59bps, 14bps and UK’s FTSE (+0.7percent), all short end of the curve moderated 2bps w/w to close at N362.8/$1, closed the week upbeat. markedly 40bps to settle at N360.5/$1 and N306.9/$1 at All emerging market equity 14.9percent. More specifically, the the NAFEX, parallel and official indices also rose w/w led by 91-day bill closed 246bps lower to window respectively. This was Brazil’s IBOV (+2.6percent) and end at 11.9percent; the 182-day as we witnessed the prevailing Russia’s RTSI (+2.4percent), bill closed 115bps higher to finish interest of FPIs in the fixed income w h i l e Ch i na’s S C H O M P at 14.3percent while the 364-day and equities market. Additionally, (+1.7percent), India’s SENSEX bill closed 13bps lower to close at the CBN’s sustained weekly FX (+1percent) and South Africa’s 17.2percent. intervention in the wholesale and JALSH (+0.1percent) followed On another note, the CBN retail FX market provided further respectively. conducted three OMO auctions support for the local unit.

Notably, South Africa’s during the week, mopping up Also, FX reserves accreted central bank left policy rates a total of N574.6bn with stop marginally by 9bps w/w unchanged at 6.75percent noting rates remaining unchanged to c. $43.1bn as at Thursday, improvements in the near-term (91-day: 11.9percent; 180-day: maintaining its recent uptrend inflation outlook while Chinese 13.5percent ; and 364-day: despite the Apex banks sustained authorities continued to calm 15percent). Additionally, the apex intervention in the currency the market with promises of bank net-repaid N73.5billion, market. Meanwhile, benchmark more stimulus amid inflow of following a re-allotment of just Brent price was largely volatile economic reports signalling a 67.4percent of the 225.4billion throughout the week, oscillating weakening of the economy. existing shareholders by NTB maturity. Demand was around $60.0/b for a significant Crude prices appreciated way of a Rights Issue of modest with an average bid-to- part of the week as the OPEC+ 3.7percent w/w to settle at $62.7/b cover ratio of 1.1x and with the supply cut continued to provide as reports from OPEC and IEA 7,434,367,256 shares at 91-day bill mostly demanded support for prices. Looking showed a fall in OPEC’s supply N12 per share. It is on (bid-to-cover ratio of 3.0x). The ahead, we expect the sustained in December as agreed OPEC+ the basis of 6 new shares auction was carried out at the weekly FX intervention by the cuts took off at the beginning for every 7 shares held following stop rates: 91-day CBN to continue to support the of Jan-19. The OPEC MOMR by the shareholders as (11percent versus 10.9percent local unit at N360-N365/$1, at the showed that OPEC supply fell at the last auction), 182-day I & E window. In the meantime, 751,000 barrels in December, led at December 4, 2018 the Qualification Date.

(13.1percent versus 13.1percent an above $60/b oil and the by Saudi Arabia.

Lafarge Africa rights issue closes Monday

…capital raise, debt restructuring to enhance shareholders returns

T

The rights being offered are tradable on the floor of the Nigeria Stock Exchange for the duration of the offer.

Chapel Hill Denham is the Lead Issuing House and Stanbic IBTC Capital is the Joint Issuing House.

L a f a r g e ’s e q u i t y capital raise and debt restructuring will deliver improvement in its financial flexibility which will result to optimizing shareholders returns.

Lafarge Africa Plc has outstanding shares of 8,673,428,240 units while its market capitalisation is now in excess of N107.55billion. The Rights price represents about 10.45percent discount on Lafarge Africa’s traded closing price of N13.4kobo as at Monday December 3, 2018. The share price closed at N 12.4 as at December January 21.

Lafarge Africa Plc is a subsidiary of LafargeHolcim, a world leader in building materials. The company has operations in Nigeria

group capacity of around 14 million Metric Tonnes.

The company is committed to its priorities to deliver growth and improve performance.

For instance, it wants t o a c h i e ve i t s g row t h initiatives through new route-to-market commercial strategy and product portfolio expansion. The new route-to-market strateg y w ill help the listed company regain l o s t ma rk e t s ha re. In its logistics and supply chain, Lafarge said it is also committed to further improve service delivery to meet clients’ demands and deepen penetration.

On production efficiencies, the cement maker is committed to continuously implement its energy efficiency initiatives to drive down production costs. It is giving priority to fixed costs reduction and tax savings.

Further improvement in profitability is expected due to expected lower fixed cost and tax.

- Ewekoro and Sagamu plants in O gun State, Ashakacem in G ombe State, Mfamosing in Cross Rivers State, Atlas cement in Rivers State and ReadyMix Nigeria and varied operations in South Africa and Ghana w ith total

Lafarge believes that cost optimisation and p o t e nt i a l p i o n e e r t a x status will lead expense savings. It is currently awaiting approval for pioneer tax status which is expected to lead to tax savings in near-term.

STOCK MARKET REPORT FOR JANUARY 18TH 2019 Thursday 24 January 2019

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Investor

A total turnover of 1.270 billion shares worth N13.463 billion in 16,476 deals were traded this week by investors on the floor of the Exchange in contrast to a total of 1.265 billion shares valued at N14.074 billion that exchanged hands last week in 19,278 deals.

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Market review:

The Financial Services Industry (measured by volume) led the activity chart with 1.131 billion shares valued at N10.573 billion traded in 10,352 deals; thus contributing 89.06% and 78.54% to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 37.744 million shares worth N1.628 billion in 2,054 deals. The third place was Conglomerates Industry with a turnover of 37.699 million shares worth N102.918 million in 566 deals.

Bullish bets on insurance, cement makers, banking stocks spurred N430bn gain Trading in the Top Three Equities namely, Diamond Bank Plc, Guaranty Trust Bank Plc and Zenith Bank Plc (measured by volume) accounted for 696.955 million shares worth N8.509 billion in 3,753 deals, contributing 54.86% and 63.20% to the total equity turnover volume and value respectively.

HEANYI NWACHUKWU

M

a n y investors l a st w e e k showed interests in some insurance companies stocks, as well as that of the cement makers, and banks which helped to propel a record N430billion gain in the trading week ended January 18, 2019.

No fewer than 38 stocks were on bargain as speculative buyers moved to Custom Street with the aim of positioning in value stocks that are currently priced low. Though, the market witnessed more advancers, there were 29 companies that lost their values.

Top on the league of stocks that gained last week are three insurance companies –NEM Insurance Plc, Sovereign Trust Insurance Plc, and Royal Exchange Plc; while Resort Savings & Loans Plc, Beta Glass Plc, and Linkage Assurance Plc were major laggards.

The Nigerian stock market closed in the green in the review trading week as Nigerian Stock Exchange (NSE) All Share Index (ASI) increased by 3.94percent.

The gain seen last week helped to narrow year-todate (YtD) negative returns to -1.35percent.

The value of listed stocks had reached record highs of N11.562trillion from weekopen low of N11.124trillion.

The NSEASI closed at 31,005.17 points. All other indices finished higher with the exception of the NSE Banking Index that depreciated by 1.04percent while the NSE ASeM index closed flat.

The NSE Insurance Index increased by 5.51percent.

NSE Industrial Goods Index was up by 12.71percent.

NSE Consumer Goods Index gained 2.7percent. Also, the NSE Oil/Gas Index gained 0.59percent; while the NSE Banking Index decreased by 1.04percent last week.

NEM Insurance Plc recorded the highest gain after its share price increased from N1.73 to N2.48 in just one week, indicating weekly gain of 75kobo or 43.35percent. Sovereign Trust Insurance Plc also increased from 20kobo to 26kobo, adding 6kobo or 30percent.

Royal Exchange Plc also

Equity Turnover - Last 5 days Date Deals !"#$%&#!'( )*+")( !+#$%&#!'( ,*1/)( !/#$%&#!'( ,*/",( !1#$%&#!'( ,*)!!( !.#$%&#!'( ,*,!.(

Turnover Volume !,)*"-.*!,'( ,--*!,,*.-,( ,-+*.-.*!1'( ),!*)!/*)"!( ,--*.-"*!!'(

Turnover Traded Value (N) Stocks !*-.+*/'.*',-0+)( '!( ,*)".*)/)*//10,!( !--( )*!-)*!1-*/),0/'( !-)( ,*)/!*'.1*)).01"( ''( ,*1/"*.,1*,1/0+!( !-'(

Advanced Stocks !!( )!( )"( ),( )!(

Declined Unchanged Stocks Stocks !!( /'( !,( //( !/( /)( !+( /!( ))( //(

occupied the top gainers table after its share price moved up from 21kobo to 27kobo, indicating a gain of 6kobo or 28.57percent.

Cement Company of Northern Nigeria Plc stock price increased from N20 to N25.10, gaining N5.10 or 25.50percent last week.

Custodian Investment Plc stock price increased from N5.30 to N6.45, gaining N1.15 or 21.70percent; Union Bank Nigeria Plc increased from N6 to N6.75, adding 75kobo or 12.50percent; Dangote Cement Plc stock price went up from N177 to N194.90, up

For Further Inquiries Contact: Market Operations Department

by N17.90 or 10.11percent.

Regency Assurance Plc was also up from 20kobo to 22kobo, adding 2kobo or 10percent. Unity Bank Plc stock price increased 83kobo to 91kobo, representing weekly gain of 8kobo or 9.64percent ; while Ikeja Hotel Plc stock price gained 13kobo or 9.35percent, from N1.39 to N1.52.

Looking at the loser table last week, it revealed Resort Savings & Loans Plc as the major laggard after its share price declined from 37kobo to 26kobo, down by 11kobo or 29.73percent.

Beta Glass Plc was also on the offer, pushing down price from N67 to N55, representing a loss of N12 or 17.91percent. Linkage

Assurance Plc declined from 65kobo to 56kobo, down by 9kobo or 13.85percent; Berger Paints Plc stock price recorded weekly decline from N8.60 to N7.75, down by 85kobo or 9.88percent.

E-Tranzact International Plc was also on the offer as its share price dipped from week-open level of N3.95 to N3.56, down by 39kobo or 9.87percent.

Newrest ASL Nigeria Plc

lost 75kobo or 9.49percent of its week-open price of N7.90 to N7.15. Livestock Feeds Plc stock witnessed declined demand as its price moved down from 53kobo to 48kobo, losing 5kobo or 9.43percent. Northern Nigeria Flour Mills Plc lost 40kobo or 9.20percent of its week-open price of N4.35 to N3.9; while Cornerstone Insurance Plc declined from 22kobo to 20kobo, losing 2kobo or 9.09percent. Wapic Insurance Plc was Pagealso 1 on the top list of stocks investors moved to reduce their stakes in causing its share price to decline from 44kobo to 40kobo, down by 4kobo or 9.09percent.

In t h e re v i e w w e e k, trading in top three equities –Diamond Bank Plc, Guaranty Trust Bank Plc and

Zenith Bank Plc (measured by volume) accounted for 696.955 million shares worth N8.509 billion in 3,753 deals, contributing 54.86percent and 63.20percent to the total equity turnover volume and value respectively.

Stock trader exchanged 1.270 billion shares worth N13.463 billion in 16,476 deals in contrast to a total of 1.265 billion shares valued at N14.074 billion that exchanged hands the preceding week in 19,278 deals.

The Financial Services Industr y (measured by volume) led the activity chart with 1.131 billion shares valued at N10.573 billion traded in 10,352 deals; thus contributing 89.06percent and 78.54percent to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 37.744 million shares worth N1.628 billion in 2,054 deals; followed by Conglomerates Industry with a turnover of 37.699 million shares worth N102.918 million in 566 deals.

Also traded during the week were 55 units of Exchange Traded Products (ETPs) valued at N5,610 and executed in 2 deals compared w ith a total of 15,288 units valued at N236,445.40 that was transacted the preceding week in 4 deals. A total of 3,573 units of Federal Government Bonds valued at N3.764 million were traded last week in 24 deals compared w ith a total of 17,996 units valued at N18.426 million transacted the preceding week in 10 deals.

New Listings (Debt) St e r l i n g Inv e s t m e n t SPV Plc N32.899billion 7-Year 16.25% Fixed Rate Unsecured Bonds Due 2025 (Series II) issued under the N65billion Debt Issuance Programme were admitted to trade at the Exchange on January 14, 2019. Also, Mixta Real Estate Plc N2.961billion 16.50% (Series II), Tranche A Senior Guaranteed Fixed Rate Bond Due 2023; and N2.320billion 17.75% (Series II), Tranche B Senior Secured Fixed Rate Bonds Due 2023, issued under the N30billion Medium Term Note Programme w ere admitted to trade at the Exchange on January 16, 2019.

22

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Thursday 24 January 2019

In association with Luxury

Malls

Companies

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Spending Trends

Why e-commerce businesses are struggling in Nigeria BUNMI BAILEY

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ost e-commerce businesses in Nigeria are str uggling due to a large number of factors such as the size of the addressable market and logistics, economic struggles but trust issues is a major factor that consumers have identified as the main issue.

E-commerce refers to the purchase and sale of goods and services via electronic channels such as the internet.

Many consumers have had unpleasant experiences such as having wrong items being sold to them, delayed in getting the item, poor quality, and poor feedback Ifeoluwa Awosoji, a digital journalist said, “I remember when I was in the university then, I purchased a hairdryer online but I got something different.

Others that have never shopped online like Oduayo Oyasiji , a lawyer, said that experience from a friend made him never to think of buying items online “A friend of mine purchased a piece of furniture online but when it was delivered, the quality of the item was poor. We tried to return it but they never came back to receive it. That was when I decided that I will not try shopping online,” He said Shopping through electron-

ic means is usually easier and more convenient as it reduces the stress of going from place to place to shop for an item.

Ademola Asunloye, a researcher said that he shops online because it is convenient for him but on specific items. “I shop for phones and laptops. I don’t buy clothes, jewelleries, and shoes because I don’t trust the quality. Most of the pictures you see online are phone shopped.” Asunloye added Last year, Konga, one of Nigeria’s leading e-commerce companies, was acquired by Zinox, a local tech firm which manufactures and distributes computers and also manages data centers. Konga struggles first appeared in 2017 when it cut nearly 60 percent of its staff.

And also that same year OLX,

an online marketplace owned

by Naspers, a global internet and entertainment group shut down its offices in Nigeria.

Additionally, Ringier, the African subsidiary of Swiss media and e-commerce company acquired DealDey , a Nigerian online shopping start-up for an undisclosed amount in 2016 And now in March 2019, there are indications that Naspers will be shutting down yet another one of its companies in Nigeria, Careers24 Nigeria, which has been operating in the job-listing market since 2014.

The poor customer service and questionable return policies have seen trust deficit largely worsen among Nigerian customers. The trust deficit

Moët & Chandon partners Filmhouse to excite customers, others with 1st Film Gala in Nigeria BUNMI BAILEY

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n the constant spirit of celebrations and creating special moments, premium global champagne brand, Moët & Chandon and renowned Filmhouse Cinemas is holding the prestigious 1st ANNUAL FILM GALA, taking place on January 26, 2019at The Wings Towers.

Known as the “Champagne of Cinema”, Moët & Chandon, is the world’s most celebrated and preferred champagne brand that recognizes the beauty of film making, the ever-evolving cast and the entire production crew that work together to create all the amazing blockbusters and box officeworthy films.

As the award season for the year unfolds all around

the world, the premium champagne brand tows its path of celebrating only the best by presenting to Nigeria the first of its kind Film Gala.

Elizabeth Oputa, Moët Hennessy, Manager of Champagnes and Wines Portfolio.

Said, “We are very delighted and honoured to bring forth this iconic moment. The relationship between Moët & Chandon and the big screen is a longstanding one, as we are the exclusive champagne

Elizabeth Oputa

of the prestigious Academy Awards, and have been the official champagne of the Golden Globes for almost three decades.”

Themed “Married to the Arts”, the first edition of the annual film gala will be a night of glamour and fine dining by celebrity chef; Tolu Eros bringing together industry veterans, emerging actors and the industry’s biggest experts.

The event which will be hosted by actress and screen goddess; Osas Ighodaro and buzzing superstar actress; Toni Tones; will be a night of glitz and glamour, as the crème de la crème of the film industry converge in one glorious night.

Moët & Chandon is the champagne of choice when it comes to celebrating life’s treasured moments such as this, therefore, it #MustBe Moët!

means that among the already small addressable market, potential customers are far more at ease shopping from international e-commerce platforms than local alternatives.

Greenwood House repositions, offers additional value to consumers of its services

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onsumers of early-years education products and services would have added value as Greenwood House, an educational services provider with specialty in pre-school skills development revamps its facilities in order to best cater to the needs of its growing client base.

Substandard early-learning education services providers are ubiquitous in the Nigerian market but with its new crèche, Green House now incorporates a curriculum filled with academic and extramural activities for early bloomers and infants with an addition of technology based learning to its services.

The revamp also includes the restoration of the crèche rooms, the play areas, and safety facilities.

Speaking about the crèche, Titilola Ekua Abudu, co-founder, Greenwood House School, said that attention, affection, and appropriate learning techniques and curriculum are critical to the emotional devel-

opment of children, “Children who are enrolled at the Greenwood House School crèche grow into confident children with basic speaking and writing skills who concentrate exceptionally well.”

Greenwood House School crèche incorporates facilities that have been purposefully built to enhance the development of children as well as facilitate the molding of their lives. With an ideal location, the Greenwood House School crèche provides a safe, clean and accessible environment.

“They develop into wellrounded and intelligent individuals, who are able to mix well with other and excel in their academics” Abudu said.

In addition to this, the crèche has all the necessary facilities including kitchen, toilets and bathrooms, beds, toys and an outdoor playground.

The atmosphere is a very warm and comfortable one that will appeal to parents and make children happy.

Thursday 24 January 2019

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Consumers enjoy first fuel scarcity-free yuletide in years as petrol hits 13-month low OLUWASEGUN OLAKOYENIKAN

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iger ian consumers heaved a sigh of relief last December as Premium Motor Spirit (PMS), otherwise known as petrol, was not only accessible, but also sold at government approved price, making federal government’s intentions behind an upward review of petrol pump price fully achieved in 2018, recent data have shown.

The average price paid by petrol consumers fell by 15.1 percent in December 2018 to N145.80 from a year earlier, the lowest since November 2017. When compared to N171.80 consumers paid in the same period in 2017, it represents the biggest monthly drop so far, according to available data from the National Bureau of Statistics (NBS).

This means that Nigerians bought the least expensive fuel during festive season last year since 2015 despite several uproars over a likely reoccurrence of fuel scarcity during the period.

According to the latest PMS data by the statistics bureau, Taraba, Gombe and Bayelsa were states with the highest average pump prices of petrol at N150.27, N150.20 and N150 in December, while Yobe, Bauchi and Jigawa sold the cheapest fuel at N143.33, N144.20, N144.21 in the review month, respectively.

Nigeria was faced with pe-

rennial fuel scarcity in previous years, particularly during yuletide when commercial activities were on the rise.

This resulted in significant transport fare hikes across the nation with commuters and manufacturers bearing the brunt.

The federal government through the Minister of State for Petroleum Resources, Ibe Kachikwu, in May 2016 announced an upward review of PMS pump price from N86.50 to N145.00 to the effect, and directed filling stations across the country not to sell the product above the fixed price.

The hike was the only way out of the scarcity and exorbitant prices of N150 to N250 Nigerians were subjected to at many filling stations across the country during yuletide, according to Kachikwu.

In spite of this, Nigerians did not only pay outrageous prices for the product, but the fuel was not available to satisfy demands in 2016 and 2017

festive sessions.

Prior to 2018 yuletide, the Group General Manager, Group Public Affairs Division of the Nigerian National Petroleum Corporation (NNPC), Ndu Ughamadu, had assured Nigerians of a fuel scarcityfree yuletide stressing that the corporation had put in the right measure to end the annual scourge. “No cause for worries. We have a robust fuel stock and high efficiency level,” the NNPC spokesman said.

While there are calls on the need to sustain the achievement after next month’s general elections, Rafiq Raji, chief economist at Macroafricaintel, said the sustainable solution to the fuel scarcity remains full liberalisation of the nation’s Oil & Gas sector.

“I think the authorities simply planned ahead knowing the potential negative implications of a scarcity on President Buhari’s re-election prospects,” Raji said. “The sustainable solution remains

full liberalisation of the sector.”

Oil-rich Nigeria is Africa’s largest exporter of crude and one of the main producers of the commodity in the world, yet the country imports petroleum products to satisfy its growing demands worsened by a near 3 percent population growth rate.

Ironically, the oil-dependent nation becomes financial weak when crude oil falls and its citizens suffer when prices of the commodity rise in the international market, despite having four local refineries.

High crude prices mean producers would incur more costs to refine petroleum products, translating to an increase in the average pump price of petrol from the government approved amount.

However, successive administrations have claimed the government bears extra costs on petrol prices as a way to alleviate the sufferings of the masses.

President Muhammadu Buhari had during the presentation of the 2019 Appropriation Bill to a joint session of the National Assembly last year revealed that a total sum of $1 billion, an equivalent of N305 billion, has been earmarked for under-recoveries by his administration to settle petrol subsidy pay-outs in 2019.

A c c o rd i n g t o N N P C monthly financial and operations report, over N144 billion was recorded as underrecoveries fund in 2017 by the state oil firm, while over N623 billion was spent in 2018.

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How technology is redefining Nigeria’s quick service restaurants industry Caleb Ojewale

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n important element in the business of quick service restaurants, is how quickly consumers are able to get food delivered to various destinations at every time. A lot of companies have invested in innovative technologies including mobile applications to ensure convenience, reliability and speed in food order and deliveries, which is poised to enhance the Quick Service Restaurant industry in Nigeria.

E-commerce has also greatly changed the traditional method of shopping which in recent times applies across several businesses. With the incredible revolution of technology, electricity, water, cable and several other bills are now paid online. Food is no longer left out as restaurant owners have begun to see the importance of getting to a consumer where they are.

Now, cravings can be quickly addressed without having to leave one’s comfort zone.

Restaurants now operate ecommerce websites or are registered as vendors on other top e-commerce platforms. It has been predicted by a Forbes report that ghost restaurants also known as delivery-only restaurants will continue to increase in 2019.

As with most online portals in e-commerce, infusing innovative technologies for food deliveries, have made daily living more convenient for an average consumer. Consumers

are constantly looking for the best ways to order goods and services with the effective use of technology, through several e-payments channels.

The advantages of embracing food delivery technologies are numerous to both consumers and the restaurants.

Customers begin to enjoy an improved customer service with personalised discounts and offers, with an array of options to choose from in terms of preferences. For the restaurants, customer-base can be guaranteed through the use of technology as there is a systematic approach to ensuring constant communications with customers through database technology. It also helps the brand to be seen as innovative and fast-paced, which helps a lot of people make quick decisions on meal choices.

In Nigeria for instance, Domino’s Pizza has extended its delivery app service to Nigeria with an entire revamp to its online delivery portal. This upgrade, allows its customers have easy, secure and quick access to its pizza menu from the comfort of their various locations, simply at the tap of the app. The newly launched app is simpler to use and convenient as opposed to waiting long queues to get your delicious meals. It also enables users to customize and save preferences, and keep track of order history. The brand has even taken it a step further, to offer free pizza to any customer whose delivery is delayed after placing an order via the app or website.

Living under poverty line

How Nigerians are struggling to survive

If you want to contact the writer of this story call: +234(0) 8030814083

Bailey.oluwabunmi@businessdayonline.com

How Saiminu switched from yam sales to vegetables and fruit Name: Saiminu Yusuf Age: 40 years Occupation: Fruits and vegetable seller State: Kano Dependants: one wife and three children Meet Saiminu Yusuf who is a fruit and vegetable seller in Ikeja.

Every afternoon he uses a wheelbarrow to move his goods around an estate in Adeniyi Jones, Ikeja.

Saiminu who hails from Kano state came to Lagos to search for money so he can cater for his family.

“I came to hustle in Lagos. I was selling yam before I changed to selling

vegetable fruits like carrots, pepper, cucumbers, tomatoes and apples. At least business has been moving.

I wish it could sell more but we just have to thank God for everything,” he told our reporter.

Though the business has been going well for him, Saiminu still experiences some challenges.

“I am alright with this business but I would like to expand the vegetable business such as buying more apples, lettuces and cabbage for resale. I equally need an umbrella stand because most times I sit under the sun all day. I come here around

Analyst: Bunmi Bailey Graphics: Fifen Eyemisanre Famous

3:30pm – 4pm and leave around 7:30pm,” he said.

Saiminu said he ventured into the business when his friend told him that no one was selling vegetable and fruits in the area.

He eventually ventured into it when he sensed the great opportunity of the offer.

When inquired where he got capital to start the business, he said the money he realized from selling yams was what he used to set up the business.

Saiminu gets his merchandise from Ijora and Mile 12 of Lagos state and thereafter resell them to his customers at Ikeja.

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GreyMatter

New DPR guidelines set governing framework for flare gas and associated gas utilization projects in Nigeria

R

ecently, the Department of Petroleum Resources (“DPR”) issued a tetrad of Guidelines in furtherance of the objectives of the Flare Gas (Prevention of Waste and Pollution) Regulations, 2018 (the “Flare Gas Regulations”).

The Guidelines essentially provide an operational framework for the implementation of the Flare Gas Regulations, which were, earlier issued to ultimately promote the monetization of gas from flares whilst curbing harmful environmental impact arising from such gas flaring and venting. .

The new Guidelines, which also derive legal and regulatory backing from some primary legislation and policy documents in the industry besides the Flare Gas Regulations, are separately titled: i. Guidelines for Grant of Permit to Access Flare Gas; ii Guidelines for Flare Gas Measurement, Data Management & Reporting Obligations; iii. Guidelines for Flare Payments; and iv.Guidelines for Producer’s Associated Gas Utilization Project.

On a preliminary note, the Guidelines, to a large extent, expand on relevant provisions in existing legislations and regula-

tions such as the Associated Gas Re-Injection Act, Petroleum Act, Petroleum Refining Regulations and the recently issued, Flare Gas Regulations. Indeed, the Department of Petroleum Resources (“DPR”), pursuant to its powers under the Flare Gas Regulations has now, by these Guidelines, specified the fees for data prying, data leasing and award of Permit to Access Flare Gas. Thus, it could be surmised that some significant addition has been introduced by the Guidelines to existing regulatory framework covering flare gas.

The recently issued Guidelines have now collectively and more clearly set out the framework for the commercialization of flare gas in Nigeria. Additionally, these

Guidelines reflect the commitment of the FGN to reduce the environmental and social impact of gas flaring, as well as develop the gas market in Nigeria by facilitating access to new economic opportunities that may be derived from gas flare capture.

Indeed, the Guidelines, if well applied, will enhance the attainment of the objectives set under the Nigerian Gas Flare Commercialization Programme (NGFCP) and the subsequent National Gas Policy approved by the Federal Executive Council (FEC) in 2016 and 2017 respectively. To this end, the new Guidelines are expected to drive in the short, medium and long terms: • clarification of the rules guiding investment in the gas sector;

• provision of an enabling environment for increased private sector participation in the gas sector; • utilization of natural gas to reduce Green House Gas (GHG) emissions in line with the country’s obligations as a party to the Paris Agreement on Climate Change.

Highlights of the relevant provisions of each of the Guidelines are as follows: a. Guidelines for Grant of Permit to Access Flare Gas The Guidelines for Grant of Permit to Access Flare Gas (“Guidelines for Grant of Permit”) stipulate the procedure for the competitive bidding processes to be adopted by the Federal Government of Nigeria (“FGN”) before a permit to take Flare Gas at any Flare Site on

behalf of the FGN, can be issued to Nigerian-registered companies.

Whilst a permit can be granted to either: • a producer carrying out a Producer’s Approved Flare Out Project; or • a preferred bidder under the FGN programme executing a Third Party Flare Gas Commercialization Project; the Guidelines for Grant of Permit applies only to bidders under the FGN programme executing Third Party Flare Gas Commercialization Project..

From our reading of the Guidelines for Grant of Permit, it is important to note, that: • the grant of a Permit to AcContinues on page 26

CCT rebuffs court order directing it to stop CJN’s trial …Says tribunal not bound to federal high court, Industrial court orders

T

he Code of Conduct Tribunal (CCT) has held that all orders of court restraining it from proceeding with the trial of the Chief Justice of Nigeria (CJN) Justice Walter Samuel Nkanu Onnoghen are not binding on it.

The CCT in a split decision of two to one discountenanced the orders of the court on the grounds that these orders were made by courts of coordinate jurisdiction and the CCT is a special Court empowered to handle exclusively the issues relating to assets declaration.

The Chairman of the tribunal, Danladi Umar held that the orders of the Federal High Court and that of the National Industrial Court are null and void on account of being inconsistent with the provisions of the Constitution, adding that section 246 makes it crystal clear that the tribunal has

“unquantified” jurisdiction to hear any assets declaration case as may be referred to it by the Code of Conduct Bureau (CCB).

According to Umar, the request to adjourn the trial Sine Die (indefinitely) on grounds of a pending appeal at the Court of Appeal, adding that section 306 of the Administration of Criminal Justice Act, ACJA, 2015, did not Make provisions for stay of proceedings in a criminal matter and that in the instant case, it shall not be entertained.

In his dissenting ruling, William Atedze held that it would result to judicial anarchy for the tribunal to proceed with the trial in view of the four subsisting court orders and the pending appeal at the Court of Appeal.

He stated that orders were binding on the tribunal until

L-R, Wole Olanipekun, SAN, Adegboyega Awomolo, SAN, Kanu Agabi, SAN and J-K Gadzama, SAN , all defence counsel for the Chief Justice of Nigeria (CJN) Walter Onnoghen, during his ongoing trial at the Code of Conduct Tribunal (CCT) in Abuja.

they are set aside in view of section 287(3) of the 1999 Constitution which allow court orders to be enforced in all parts of the county, stressing that the CCT cannot oper-

ate in isolation.

“Having summarised argument from both parties, it is my submission that CCT as a creation of law is bound by the existing court orders to avoid

judicial anarchy”, he held.

The member who further held that the issue of jurisdiction of the tribunal to entertain Continues on page 28

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New DPR guidelines set governing framework...

Continued from page 25

cess Flare Gas shall only be by an open and competitive bid and any entity or individual barred by the Economic and Financial Crimes Commission (“EFCC”) as well as the Independent Corrupt Practices and Other Related Offences Commission (“ICPC”), or appears on the World Bank Debarred List and/ or barred by the US Treasury Office of Foreign Assets Control shall not be eligible to participate in the competitive bid process conducted by the FGN. The bid process includes (i) Registration on the programme portal; (ii) downloading the Request for Qualification and the Programme Information Memorandum (“RFQ Package”); and (iii) Submission of a Statement of Qualification (“SOQ”) to demonstrate capability to develop a Project.

After evaluation of the SOQ, successful applicants will receive Requests for Proposal with supporting materials and Flare Site Data; and thereafter apply for a Data Access permit as well as pay Data Prying Fee and the Data Leasing Fee. Qualified applicants may submit Technical, Commercial and Financial Proposals to take and commercialize Flare Gas on behalf of the FGN and these proposals are required to be accompanied by a Bid Bond (1% of the estimated Project capital expenditures subject to a maximum of $1,000,000), and such Bid Bond shall remain valid for a period not less than six (6) months after the bid submission due date.

• The Bid Bond shall be returned to a Bidder not selected as the Preferred Bidder or Reserve Bidder.

Any Permit can be revoked by the Minister of Petroleum Resources (“Minister”) in circumstances outlined in the Flare Gas Regulations.

• a Permit Holder has exclusive right to take such quantities of Flare Gas from a Flare Site or from one or more Flare Sites and for such duration as may be specified in the Permit; and the title to such Flare Gas shall be transferred from the FGN to the Permit holder.

Pipelines, machinery and other facilities used to transport Flare Gas from the Flare Gas Connection Point to the Delivery Point, must meet engineering best practice, standards approved by the DPR, as well as standards agreed upon between the Permit holder and a Producer as it relates to health, safety and environment protocols.

• A Permit Holder shall not engage in routine flaring or venting of natural gas from any self-operated facility.

The Guidelines for Grant of Permit specifies that within sixty (60) days from the date of being declared the preferred bidder, the Preferred Bidder must execute a Milestone Development Agreement (MDA) and Gas Sales Agreement (GSA) with the FGN; whilst

a Connection Agreement and Deliver or Pay Agreement (where applicable) shall be executed between the Preferred Bidder and the relevant Producer.

A Preferred Bidder who is unable to fulfill the stated conditions for the grant of a Permit shall be issued a revocation notice by the Minister. Where the conditions remain unfulfilled within thirty (30) days of issuance of the revocation notice, the affected Preferred Bidder shall be deemed to have forfeited its Preferred Bidder status and the Bid Bond will be drawn on by the FGN. However, where, all the relevant conditions are fulfilled, a Permit to Access Flare Gas is granted to a Preferred Bidder within fourteen (14) days from the date all conditions are satisfied.

B. Guidelines for Flare Gas Measurement, Data Management & Reporting Obligations The Guidelines for Flare Gas Measurement, Data Management & Reporting Obligations (the “Guidelines on Flare Gas Monitoring”) seek to ensure compliance with the Flare Gas Regulations and lays out the criteria, general requirements and obligations as it relates to measurement, data management and reporting of Flare Gas at all processing facilities.

In order to effectively identify and quantify environmental impact of, or the opportunities in commercializing Flare Gas, it is necessary to obtain, monitor and audit data of all natural gas that is produced, utilized, flared and/ or vented.

Accordingly; • Producers and Permit Holders are required to maintain a daily log of each occurrence of flaring and venting of natural gas within its facilities, and submit same to the DPR within twenty-one (21) days from the end of each month; and such logs must be retained in safe custody for no less than thirty-six (36) months.

• Producers and Permit Holders must prepare and submit to the DPR an annual report, which must be submitted each year by March 31 for the previous year.

• All data on gas production, utilization and flaring shall be subject to quarterly and annual reconciliation with the DPR.

• Producers are required to calculate and report per Oil Field and per Flare Site: (i) Gas to Oil (GOR); (2) Associated Gas Utilization Factor (AGUF); and (iii) Routine and Non-Routine Flaring quantities.

• Gas production, gas consumption, liquids such as condensate and Liquefied Petroleum Gas (LPG) and flare gas, must be monitored and measured.

• Several reports, (such as Producer Historic & Associated Gas (“AG”) Accounting Report; Own (Energy) Consumption Report; Vented Gas Report; Project Flare Gas Accounting Report), must now be prepared and submitted

by Permit Holders.

• Producers and Processing Facilities must have complied with the provisions of the Guidelines and have installed all necessary metering equipment within the transition period of twentyfour (24) months from the date of the Guidelines. However, greenfield projects must comply immediately.

Any Producer or Permit Holder that provides inaccurate or incomplete Flare Gas Data to the DPR or fails to comply with any of the provisions of the Guidelines on Flare Gas Monitoring shall be liable to one or combination of the penalties which include monetary fines, suspension of operations, revocation of OML or Marginal Field awarded, and/ or imprisonment for a term not exceeding six (6) months. c. Guidelines for Flare Payments The Guidelines for Flare Payments detail payments to be made for flaring and/or venting natural gas in Nigeria.

According to the stipulated procedure for Flare Payment: • The DPR shall collate and reconcile reported monthly oil production figures in OMLs and Marginal Fields; • Producers are required to present the data gathered in accordance with the Guidelines on Flare Gas Monitoring; • An average monthly oil production will be used to establish the applicable Flare Payment, taking into consideration only days during which oil was produced; • The DPR shall validate the various elements that contribute to the determination of the

Chargeable Flare Gas Quantity; • The Flare Payment Amount shall be computed monthly as a product of the Chargeable Flare Gas Quantity in thousand standard cubic feet (Mscf ) multiplied by the applicable Flare Payment rate; • Flare Payment Amounts shall be paid by the Producer in accordance with the procedures for payment of royalties to the FGN under the Associated GasReinjection Act; and • Reporting shall be done as prescribed in the Flare Gas Regulations.

No Flare Payment Amounts shall become due in respect of an agreed volume of Flare Gas that the Producer is committed to deliver to the Permit Holder under a Deliver or Pay Agreement, as from the commencement of commercial operations of the Project.

Where a Producer fails to meet the obligations stipulated in the Flare Gas Regulations, additional payments shall apply. Also where the Producer fails to remit the Flare Payment Amount, it shall attract applicable sanctions as prescribed in the First Schedule to the Petroleum Act. d. Guidelines for Producers’ Associated Gas Utilization Project The Guidelines for Producers’ Associated Gas Utilization Project (“Guidelines for Associated Gas Utilization”) set the framework for: • Producers’ Associated Gas Utilization Projects for Own Consumption; and • Producers’ Associated Gas Utilization Projects for Commercialization.

The Guidelines for Associated Gas Utilization apply to Producers seeking to execute flare out projects but want to be exempt from the bidding process for Third Party Flare Gas Commercialization Projects. Thus the Guidelines for Associated Gas Utilization lay out the procedure for obtaining a Permit to Access Flare Gas for Producers’ Approved Flare Out Projects (“PAFOP”), which can only be issued to a Nigerian registered company.

Under the Guidelines, Associated Gas projects are categorized into: a. Own Consumption as incorporated into a Field Development

Plan approved by the DPR; and b. Associated Gas and Flare Gas Utilization Projects for commercialization: Key provisions in the Guidelines include: • PAFOPs being exempt from the bid process; • A Producer may apply to the Minister to obtain a Permit to Access Flare Gas for a PAFOP through a midstream subsidiary corporate entity; • Any Producer wishing to apply for a PAFOP shall apply to the Minister and such application shall be supported by (i) Project description; (ii) 10-year Associated Gas Production Forecast and Flare Gas forecast Quantities; (iii) a list of Flare Gas-to-Market Product Off-Takers; (iv) Investment cost and proof of economic viability; (v) a list of shareholders in the existing/proposed midstream company that will execute PAFOP, among others; • Upon meeting the set conditions precedent, the applicant shall be awarded a Permit to Access Flare Gas and become a Permit Holder pursuant to the Flare Gas Regulations.

Where an applicant is unable to satisfy the conditions precedent, the approved PAFOP Status earlier granted shall be deemed forfeited.

The Guidelines for Associated Gas Utilization provide that on the date upon which the Flare Gas Buyer declares start of commercial operations or the date upon which it starts delivering its Flare Gas-to-Market Product(s) to its Off-Taker(s), whichever comes earlier (Commercial Operations Date), the Milestone Bond shall be replaced by a performance Bond, which shall be valid for the term of the Permit to Access Flare Gas.

The Grey Matter Concept is an initiative of the law firm, Banwo & Ighodalo.

DISCLAIMER: This article is only intended to provide general information on the subject matter and does not by itself create a client/attorney relationship between readers and our Law Firm or serve as legal advice.

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

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THE BUSINESSOF LAW

CAM bill progresses to third reading

RIGHTSWATCH

‘Ask AGF to take complaints against Justice Onnoghen to NJC’, SERAP tells Buhari

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ocio-Economic Rights and Accountability Project (SERAP) has urged President Muhammadu Buhari to “instruct the Attorney-General of the Federation and Minister of Justice Abubakar Malami SAN, to immediately withdraw the charges against the Chief Justice of Nigeria Walter Onnoghen and to send any allegations of breach of asset declaration provisions of the 1999 Constitution of Nigeria (as amended) to the National Judicial Council (NJC) for investigation.”

The organization said: “Mr Malami should then request Justice Onnoghen as the Chairman of the NJC to recuse himself, so that the next most senior justice at the Supreme Court can preside over the process and set up

Theodora Kio-Lawson

T

he Companies Allied Matters (CAM) Bill on Tuesday January 22nd, 2019 passed the third reading at the Federal House of Representatives.

The Bill, which passed by the Senate in 2018 is the largest business reform bill to be passed in Nigeria in over 28 years, as it represents the re-enactment of the existing Companies and Allied Matters Act 1990 (CAMA).

In a statement signed by the Senior Special Assistant to the President on Industry, Trade and Investment, Dr Jumoke Oduwole, the Secretary of the Presidential Enabling Business Environment Council (PEBEC) stated that the development signifies a meaningful progress towards aligning business practices, which according to her had been heavily constrained by several provisions in the old 1990 Act, with global standards as it speaks to all matters affecting a company, from incorporation to winding up and insolvency.

She said, “The Bill directly affects the influx of foreign direct investment (FDI) into Nigeria due to its relevance to the ease of doing business and investing in Nigeria.”

According to the legislative brief of the new Bill, it has new features that will make doing business in Nigeria a lot easier.

“In order for Nigeria to improve it’s standing in World Bank Doing Business (WBDB) Ranking Index, it needs to improve on its ease of establishing and running

businesses and bring its business legal regime in tandem with modern advances,” the legislative brief explained.

According to the PEBEC secretary of PEBEC, a key thrust of the Bill is therefore aimed at simplifying the process of starting and growing a business in Nigeria by abolishing the requirement for a company to have authorized share capital, enabling a single person to form a private company, introducing for the first time a business rescue process, and introducing the concept of limited liability partnership.

It also ensures more appropriate regulation for micro, small and medium scale enterprises, by making it optional for smaller companies to have a company secretary, comply with accounting requirements, and for oneman and small companies to hold an annual general meeting, as well as introducing separate models of articles of association for private companies.

Oduwole revealed that in line with the mandate of PEBEC, this re-enactment was a strong demonstration of the commitment of the Buhari-led Administration to improving the business environment, and ultimately Nigeria’s competitiveness.

“The passage of the Bill was promoted by the Corporate Affairs Commission (CAC), and was made possible through the collaborative efforts of several public and private sector stakeholders supported by the Enabling Business Environment Secretariat (EBES), including the Senate, the House of Representatives, the National Assembly

Business Environment Roundtable (NASSBER), the Nigerian Economic Summit Group, the Nigerian Bar Association Section on Business Law (NBA-SBL) and a number of leading commercial law firms in Nigeria.”

Speaking further on this positive development, Dr. Oduwole stated “This is a significant hurdle crossed in our efforts to help businesses grow in Nigeria, and in driving our Ease of Doing Business ranking as a nation.

“We congratulate every Nigerian on this achievement, and weapplaud the several partners that came together in partnership to make this work. We look forward to receiving the Bill for Mr President’s assent, and we are confident of the benefits this will bring to businesses to drive exponential growth in the next few years.”

Some other benefits of the landmark reform Bill include the promotion of policies that will enhance the regulatory environment for growth of Micro, Small and Medium Enterprises (MSMEs), reduce entry barriers for smaller businesses, enhance transparency and shareholder engagement, align regulatory frameworks with international best practice for competitiveness, and increase the efficiency of the regulatory process in line with today’s realities.

Further benefits are faster and cheaper registration of companies limited by guarantee, easier authentication of documents, prevention of asset shielding, and combating money laundering, terrorism financing or other illicit or criminal activities using companies as vehicles; among others.

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is whether he is afforded the due process of law, as he is constitutionally and legally entitled to.

This is our interest in this case, and this should be the interest of every lover of justice.”

“It is the principle of due process of law which is at stake in this case, the soul and spirit of which will be endangered if Justice Onnoghen’s case continues to be heard before the Code of Conduct Tribunal. A denial of justice to one citizen is a denial of such to all. Due process here requires that Justice Onnoghe be given an opportunity to have allegations against him heard by the NJC.” “The bringing of this case against Justice Onnoghen before the Code of Conduct Tribunal

Abubakar Malami, San

a panel to investigate the allegations against Justice Onnoghen to ensure fairness and justice in the matter.”

In a statement today by SERAP senior legal adviser Bamisope Adeyanju, the organisation said: “We believe that enforcing asset declaration provisions would help to prevent corruption and abuse of office and ensure transparency in public officers including judges. But the government should follow due process of law, and allow the NJC to consider the allegations against Justice Onnoghen first before pushing for prosecution, should there be any relevant admissible evidence. This would help to accord Justice Onoghen his entire rights through laid down process.”

The statement read in part: “The moral guilt or the legal guilt of Justice Onnoghen should be left for the judicial process to decide, as he is presumed innocent until proven guilty by a court of competent jurisdiction. For now, the fundamental question

would appear to have fallen below the minimum procedural standards of legal justice, which in turn would affect the quality of justice he receives. Due process rights should not be curtailed in the interest of expediting enforcement of asset declaration provisions. The authorities have the responsibility to insure fair treatment of judges or others who face these kinds of charges that may ultimately lead to deprivation of liberty.”

“Preventing the NJC to first hear the allegations against Justice Onnoghen would deny him his constitutionally and internationally recognized right to a fair hearing and lead to the matter being unnecessary politicised.”

“The authorities may have a strong case against him but the possibility of success is diminished if the proper procedure is not followed. The requirements of justice and success of the fight against corruption justify the fundamental need to ensure and apply due process rights in this case.”

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Quicklaw Limited leverages technology CCT rebuffs court order directing... for the delivery of legal support services Continued from page 25

IFEOMA OKEKE

O

nline legal support company, Quicklaw Limited is simplifying legal processes by leveraging technology to advance the Nigerian legal industry.

Navigating the Nigerian legal system can be incredibly intimidating for small business owners and individuals without the support of a lawyer; nevertheless, the importance of legal support cannot be over emphasized as it helps protect the business and individual in the long run.

With the operational cost of running a business, it is presumed that having a lawyer on retainer is an unnecessary expense and as a result, legal services are only patronised when serious legal problems arise. Taking into consideration the current wave of technological innovation across various industries of the Nigerian business climate, it is no surprise that the legal industry also acknowledges the effectiveness of technology in improving delivery of services.

Championing this cause is Quicklaw.ng by Quicklaw Limited with the goal to redefine and

modernise the legal industry in Nigeria. This online platform aims to change the perception of the Nigerian legal system with its value offering of easily accessible, fast and affordable legal services.

Through the website, Quicklaw Limited fosters a community of increasingly legal-conscious individuals.

According to Sade Michael, the CEO QuickLaw Limited, “This platform was founded with the focus of proactively helping people secure and protect the things they value. Now, Nigerians can easily access lawyers all over the country via a 24-hour chat line to obtain free legal advice and get answers to their queries; they will be able to manage their legal affairs much more conveniently and at affordable rates. In summary, Quicklaw Limited provides substantial value across a wide range of legal services, from registering a business, to creating contracts, to resolving property matters and much more.”

As the train of technological development continues on its progressive track in the Nigerian legal industry, Quicklaw Limited is set to empower individuals by providing a fast, yet affordable way of acquiring legal assistance.

Thursday 24 January 2019

the charge against CJN must first be resolved, held that status quo must be maintained by adjoining proceedings sine die until all contending issues are resolved.

Although the Chairman ordered that the motion challenging the jurisdiction of the tribunal be moved immediately, counsel to the defendant, Chief Wole Olanipekun SAN however, informed the tribunal that the response of the complainant, Federal government was served on him late Monday and as such needed time to study the response and then filed reply on point of law.

Counsel to the Federal government, Aliyu Umar, agreed that the government’s response was served late on the defendant, prompting the Chairman to adjourn proceedings to Monday, January 28.

“Discontinue Onnoghen’s trial”- NBA In the mean time, the leadership of the Nigerian Bar Association (NBA) has called on the federal government to dis-

continue the trial of the Chief Justice of Nigeria, Honourable Justice Walter Onnoghen before the Code of Conduct Tribunal.

This call was made in a statement dated January 21st, 2019 and signed by the President, Paul Usoro, SAN. In the statement, the NBA president urged the tribunal to abide by established judicial precedents, which all dictate that the allegations must be referred to and handled by the National Judicial Council (“NJC”) “…And it is only after the NJC’s pronouncement thereon against the CJN can the FGN prosecuting agencies proceed against him before any Tribunal or Court of Law. For as long as the CJN remains a judicial officer, that process avails him and is mandatory of compliance by the FGN,” he said.

The statement read in part, “Should the Federal Government however succeed in removing Honorable Mr. Justice Walter S N Onnoghen, GCON as the CJN pursuant to the provisions of Section 292(1) (a)(i) of the Constitution, there would be no need or require-

ment for the FGN to fulfill the NJC pre-condition ahead of his possible prosecution. With such a constitutional removal from office, Onnoghen CJN would cease to be a judicial officer and the allegations against him would not need to be determined by the NJC ahead of any possible prosecution.

“The choice is therefore that of FGN to make – either to pursue the removal of the CJN pursuant to Section 292(1) (a)(i) of the Constitution or report the alleged assets declaration infraction to the NJC for its consideration as a precondition for the possible prosecution of the CJN. Whichever route the FGN chooses, the CCT proceedings must abate and be discontinued. It constitutes an assault on due process and undermines the Rule of Law. The sponsored media trial of the CJN must also cease. Amongst others, it criminally destroys the justice sector, subverts due process and completely erodes the Rule of Law. “This desecration of the justice sector must stop now, please.”

photofile

Spokesperson of the Lawyers in Defence of Democracy protest of the ongoing persecution of the Chief Justice of Nigeria at the Code of Conduct Tribunal (CCT) in Abuja. Picture by TUNDE ADENIYI.

L-R, Kenneth Udeze, National Chairman AA, Ikenga Ugu Chinyere, spokeperson CUPP and Ojinika Geff, chairman C4C during a reaction to the Federal Government claim that opposition is sponsoring of Bandits and Terrorism in Abuja. picture by TUNDE ADENIYI.

L-R, Adegboyega Awomolo, Aliyu Umar, leader of prosecutor of the Chief judge of Nigeria and Wole Olanipekun during the ongoing persecution of the Chief Justice of Nigeria at the Code of Conduct Tribunal (CCT) in Abuja.

Protesters at the ongoing persecution of the Chief Justice of Nigeria at the Code of Conduct Tribunal (CCT) in Abuja.

L-R, Aliyu Umar, Leader of prosecutor, Wole Olanipekun, leader of Defence Counsel and Chief J-K Gadzama during the ongoing persecution of the Chief Justice of Nigeria at the Code of Conduct Tribunal (CCT) in Abuja.

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29

Energy Report Oil & Gas

Power

Renewables

Environment

Dangote Refinery to create $11bn market for Nigerian crude oil Olusola Bello

T

he $9-billion Dangote Refinery will create $11billion per annum wor th market for Nigerian Crude.

This is just as the whole complex which comprises a refinery, petrochemical and fertilizer companies, will generate about 80,000 direct jobs for Nigerians when they become operational.

What did Nigeria generate last from crude oil sales?

Dangote Petroleum Refinery can meet 100 per cent of the Nigerian requirements of all liquid products (gasoline, diesel, kerosene and aviation jet) and also would have surplus of each of these products for export.

The company has a strategically located marine infrastructure for Crude receipts and product trade It is designed to produce Euro V products which means it will meet the specifications of European standard.

The refinery will use the Nigerian crude and natural gas to the extent it is available.

It is also designed to process

a variety of crudes including all the African crudes, a range of Middle Eastern crudes and US crudes.

According to the officials of the company, the promoter of the refinery did not invest in expensive units like Delayed Coker or Vacuum Distillation Units (VDU).

It rather minimises capital costs and project schedule and a minimal Hydrogen & Sulphur plant sizes.

It maximises gasoline or petrol, which is in high demand and will utilise 53 per cent of its production

capacity compared to 22 per cent in the existing refineries in Nigeria.

There would be maximised value added petrochemicals polypropylene and polyethylene product with a minimise low-value fuel oil Gowin Emefiele, governor of Central Bank of Nigeria (CBN), after being conducted round the complex, said that although Nigeria was almost self-sufficient in fertilizer production, the size of the fertilizer company is twice that of an existing

Oil union asked FG to revoke licenses of non performing modular refineries

T

he Federal Government has been asked to revoke the license issued to non performing Government Modular and Private Refineries and re-issue same to operators with technical and financial capabilities, while the promised establishment of Modular Refineries by the Government should be vigorously pursued.

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) who gave this advised also said the government should be vigorously pursued the establishment of the Modular Refineries she promised.

The association also advocated for a change of the current operating model of the refineries which it described as unsustainable and therefore suggested the adoption of Nigeria Liquefied Natural Gas (NLNG) Business model after the refineries must have been rehabilitated.

It said this would enable the facilities to yield better dividends to the Nation’s economy.

PENGASSAN in a statement signed y its Francis Olabode Johnson, President and Lumumba Okugbawa, general secretary while commending the efforts of the Federal Government through the Nigeria National Petroleum Corporation (NNPC) at ensuring adequacy and consistent supply of Premium Motor Spirit (PMS) throughout the festive season, however, called on the Government to increase local refining capacity and remove all observed encumbrances to full rehabilitation of all the four Refineries. It also advised that Government should initiate a more workable and sustainable intervention by incorporating more investors into local refining.

The statement however frowned at the conflicting pronouncements over inadequate funding and crude

tation of petroleum products and food items is saved, the government would have boosted its foreign exchange reserve, as about 55 per cent of the foreign exchange spent by government or CBN goes to importation of petroleum products and food.

The Dangote Refinery, he said, is a $9 billion project that is being funded by both local and foreign banks, adding that CBN had committed only about N75 billion in supporting it “We would continue to show support to individuals and companies that displayed the determination to support the government and support the CBN in restructuring the base of the Nigerian economy, he said.

Commenting further on the project, Aliko Dangote declared that Nigeria’s biggest challenge was the country imports more that it produces, like any other African country. He that by the time the fertilizer company was completed, Nigeria would be the largest-exporting fertilizer country in Africa, the largest exporter of petrochemicals products, and the biggest in Africa in export of petroleum products.

Ikeja Electric warns public against activities around power lines

supply as well as staff attrition challenges which are currently hindering smooth operations of the refineries and as a way out advocated for an increase in crude supply, raising of the funding levels and the employment of more qualified manpower.

Arising from the Association’s National Executive Council (NEC) meeting in Uyo, Akwa Ibom State recently, PENGASSAN listed Forte Oil, Seplat, AITEO and NIPCO as being amongst the worst abusers of the Nation’s labour laws and therefore vowed to resist their nefarious acts on the workers who are also citizens of Nigeria.

According to PENGASSAN, these oil and gas companies are notorious in the practice of casualization, contract staffing, outsourcing and off-shoring of jobs as well as other unfair labour practices and under-hand tactics in their Labour relations activities.

Olusola Bello, Team lead, Analysts: Isaac Anyaogu, Stephen Onyekwelu, Graphics: Joel Samson.

fertilizer company in the country. He added that that by the time the refinery in the complex takes off by the first quarter of 2020, Nigeria would not only be self-sufficient in the production of refined products, but will also join the league of those that export petroleum products.

“I am sure by that by the time Dangote completes all these projects, the CBN will begin to ask Dangote to sell foreign exchange to it,” he said.

Commenting further, the CBN governor also said the

petrochemical plant is also about 10 times that of the existing petrochemical plant in the country.

“This is certainly a transformational project for Nigeria and it totally keys into the objectives of this government - that is, advocating for conservation of foreign exchange and diversification of the economy,” Emefiele said.

To put the significance of the project in proper perspective, he added that: “By the time you dimension the size of the foreign exchange that is used to import petroleum products; it is at least one-third of the foreign exchange CBN spend to bring goods and services to the country.”

Emefiele said that the apex bank would raise to about 50 the 42 items that are currently restricted from accessing foreign exchange.

When importation of petroleum products is added to the restriction list, when Dangote refinery comes on stream, this would have helped the country to save a lot of foreign exchange in the nearest future, Emefiele explained.

He said by the time the foreign exchange on impor-

W

orried by the danger constituted by the activities of those who work around electricity power lines or high tension wires, Ikeja Electric (IE) has cautioned the public under its network against building structures and engaging in social and economic activities under power lines.

The company said the specific clearance/distance which the public must maintain away from a 33/11KV lines is 5.5 meters (20ft) on both sides, while for 132KV lines the distance must be 15 meters (50ft) on both sides, while 330KV lines must have a clearance of 25meters (60ft) on both sides.

Jamiu Badmos, Ikeja Electric’s Head of Quality, Safety, Health & Environment (QHSE), explained that carrying out social and economic activities

under power lines exposes people’s lives to danger, and carries the risk of electrocution.

According to him, fatality within the energy sector can be prevented if the public religiously adheres to precautions and avoid carrying out activities close to electrical installations.

“As a responsible service provider, we are aware of our obligation to ensure that every resident within our network is kept safe, especially bearing in mind the hazardous nature of electricity,” he said.

He said the company was using the opportunity to remind the public that electrical installations are harmful and must be avoided as much as is possible, saying that the company was appealing to customers to avoid activities under power lines, “especially as the integrity of old cables cannot always be guaran-

teed.’’

He revealed that even with the huge resources IE has spent on enlightenment campaigns to sensitise the public on inherent dangers of life-threatening activities, some of the people had remained adamant.

Badmos further called for the intervention of the government and relevant stakeholders in stemming this ugly development by declaring activities under power line as illegal and moving people and markets away from the danger spots to save lives and property.

“As a company that places high priority to safety in line with its Quality, Health, Safety and Environment (QHSE) policy, Ikeja Electric has consistently championed initiatives that entrench the culture of safety to ensure no live of staff, contractors or customers is lost through electrocution,” he said.

Email: energyreport@businessdayonline.com, Tel: +234-8023020011; +234-7037817378

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Thursday 24 January 2019

Energy Report

The story of 200,000 barrels Egina and its impact on Nigerian economy When news of the production of first oil from the Egina field emerged, Nigerians were impressed that such a huge stride had been accomplished in their country. OLUSOLA BELLO examines the journey that culminated in the announcement and what Nigerians have gained in the whole process.

F

irst Oil on Egina was achieved at 11:20pm on 29th December, 2018, and history was made 150 kilometers off the southern shoreline of Nigeria that day. Gladly, it was a pleasant history. So pleasant was it that it resonated across the country as policy makers, analysts, economists, and government officials finally saw something to cheer as the curtains fell on 2018.

From 2013, a team of professionals drawn from around the world had laboured to achieve first oil at the Egina field, a deep oilbearing field, in the Atlantic Ocean. Their effort paid off on that hazy December night. But there were other details that made this feat even more delightful.

First, the Egina project, which entailed the development of the Egina deep-water field and the construction of a Floating Production Storage and Offloading (FPSO) unit suitable for evacuating crude oil from the field, was delivered on schedule.

Second, the project had been executed in a cost-effective manner. As a matter of fact, savings to the tune of $1billion was achieved as a result of judicious and prudent use of resources.

Third, the project had a huge local content component and had served as a model for local manpower participation and development ; delivering huge

technical knowhow and expertise to hundreds of Nigerians who participated in building or fabricating various aspects of machinery that eventually made Egina come alive.

The project involved a record level of local contractors. Six of the eighteen topside modules on the FPSO unit were built and integrated locally, and 77 percent of man-hours spent on the project were worked locally.

The voices of those Nigerians, who were involved in various aspects of the efforts exuded the veneer of pride and accomplishment on 29th December, 2018.

“I was a trainee on the Egina project when the FPSO was built at the SHIMCI Yard, LADOL dockyard

in Lagos,’ says Oluwaseyi Akinbola, a graduate of the Obafemi Awolowo University, Ife. In all, we were 103 in my batch, we were trained in welding positions, fluxcored arc welding and argon welding. We gained a host of soft skills during the project,” he said.

He also had the opportunity to interact with Korean and Nigerian instructors during the project and says will never forget the life lessons those wonderful instructors impacted on him personally. The project was all the more important to Seyi because at the time he was called up to join the team, he was jobless and didn’t know where to turn. “It’s the largest FPSO unit Total has ever built,”

Pepper has a new name!

Off the coast of Nigeria, in the fishing communities of the Niger Delta, to the Ijaw people, “Egina,” literarily means “pepper.”

While several kilometers into the hinterlands, on the streets of Lagos, Warri, Kano and Kokori Inland,

the word “pepper” is often used allegorically to mean “money.” Indeed, Egina project will ultimately translate to money for Nigeria at different levels.

Already, it has created jobs for Nigerians because revenues in form of taxes and royalties have gone to government as a result of the project. It has enriched hundreds of Nigerians with invaluable experience and the can-do-spirit. Developed

by TOTAL and its partners: NNPC, CNOOC, SAPETRO and PETROBRAS, the project is an entirely new chapter in the history of Nigeria’s oil and gas industry.

Egina has long been a symbol of pride and beacon of hope for Nigeria. Speaking to journalists on the sidelines of the Africa Oil Week conference in Cape Town, South Africa last November, Minister of State for Petroleum, Ibe Kachikwu, in optimism said, “Egina should come into production in December or may be January. Hopefully, that should lift our production closer to 2.15 million barrels by the start of 2019 barring any unforeseen shutdowns.”

His expectation was met and with the success recorded so far, there are indications that Nigeria will be the biggest beneficiary given the peculiar situation in which the country now finds itself, with respect to oil revenues and the national budget.

For half a decade, Nigeria has not reported any

major new oil projects or investment yielding output.

Therefore the $16 billion Egina deep-water project

by Total has been hailed as a major breakthrough.

For Total, Egina equally marks a new beginning. In addition to OML 130, where Egina is located, Total operates other offshore assets such as OML 99 (where it controls 40 percent stake), where the Ikike discovery is located, OML 100 (where it controls 40 percent stake), and OML 102 (where it controls 40 percent stake) where the Ofon 2 project was completed in 2016.

Onshore, Total is the operator of OML 58 (where it controls 40 percent stake) under its joint venture with Nigerian National Petroleum Corporation (NNPC).

The Group is also developing Liquefied Natural Gas (LNG) activities with a 15 percent stake in the Nigeria LNG Ltd, which operates six LNG liquefaction trains on Bonny Island.

The Total Group’s production in Nigeria was 267,000 barrels of oil equivalent a day in 2017, but with the activation of the Egina Field, the equation has been significantly altered.

While Egina stands as a model of success, analysts have expressed optimism in the capacity of government to create an enabling environment for the implementation of policies that can encourage more investors to stake funds on Nigerian assets.

2nd tier rate, they will need to compete with either the NNPC or other privileged importers who are able to access forex at the cheaper rate and lose money.

In any country where there exists a managed price regime, as the price manager acknowledges that there is inflation in the country year on year, they must also acknowledge and reflect this inflation on marketer’s margins to enable marketers pay cost of living adjustment (COLA), increases in salaries of their employees or buy local spare parts for equipment.

As the price management body also acknowledges that there are exchange rate increases they must also acknowledge and reflect these increases in costs for the purchase of imported spares in marketer’s margins to enable them buy new equipment and spares to maintain imported equipment. The PPPRA is unable to reflect

these changes due to its inability to change the pump price for whatever reason.

This leads to the degradation of industry equipment and infrastructure across board, hence the obvious poor state of depots, fuel trucks and filling stations.

International developments and the evolution in downstream infrastructure such as safer and spill-proof trucks, the full digitalisation of depots and filling stations leading to higher productivity and blockage of leakages, and product theft and upgrades in Quality and Environmental protections as well as Safety upgrades have not fully been implemented in Nigeria. The reason is simply because the business cannot pay for it… yet our poorer neighbors in Africa are up-scaling and benefiting.

The stagnation brought about by the perpetuation of this subsidy regime which we all know is unsustainable also

perpetuates the inefficiencies in our distribution logistics from the ship to ship transfers to the incredible amounts paid for demurrage by NNPC and industry. Interestingly, all of are not factored in when the cost of subsidies to the Nigerian State and people is being calculated.

Finally, the last three years of subsidy debt was not the first time that marketers have been owed by government.

Indeed intermittent debt woes have persisted since the current price regime was instituted by the Obasanjo administration in 2001/2002.

The fact however is that the debt has never been so high nor lasted so long... it has devastated very many depot owners and investors leading to their takeover by AMCON or just closing shop without hope of recovery.

The time for deregulation is nigh to save this industry which has been laid waste by this pricing policy.

the young man said on 9th January, 2019, smiling from cheek to cheek.

The most gladdening aspect of the Egina project’s success is that it will add 200,000 barrels per day to Nigeria’s crude oil output when its output hits plateau level of production. When Egina attains full production, its output will represent about 10 percent of Nigeria’s current crude oil production.

Why subsidy is bad for the country

T

h e re hav e b e e n many arguments and explanations why the subsidy in the downstream of the petroleum industry is bad for the country. Such arguments have always raised questions bothering on rising level of the country’s debts, inefficient allocation of the country’s resources and the opportunity cost of not spending these vast amounts on education, health, education and infrastructure. Local and international economists as well as institutions have weighed in on the subject and all are in agreement that the practice is unsustainable.

What has not however been appropriately covered is the impact the subsidy regime has had on the downstream petroleum sector itself. This sector represents a key area of the economy of any country and governments invest significant time and effort to ensure its ro-

bustness because of its strategic nature and positioning.

In most countries, it is one of the top revenue earners for government and represents an efficient means of tax collection. Countries have a real stake in keeping this industry robust and sustainable.

In Nigeria however, the only tax collected on petroleum products on the pricing template is to fund the Petroleum Products Pricing Regulatory Agency (PPPRA) and the Petroleum Equalisation Fund (PEF).

The impact is that development and maintenance of national petroleum distribution infrastructure is funded from other sources which accounts for the non-existent development and insufficient maintenance of such infrastructure.

Enough has been said about what is necessary for refineries to function properly or for new refineries to be built. The fuel subsidy will not

allow any investor to recover its cost in a transparent and sustainable manner without intermittent and often fraudulent intervention.

Indeed, the management of the subsidy regime has created gatekeepers and rentseekers who prefer to invite and engage with and sell products to briefcase business men rather than serious investors who have invested their funds in vessels, jetties, depots, transport fleets and filling stations.

This has led to the exit of these serious investors or their need to buy refined products from friends of these gatekeepers to try and stay in business pending a time when the market is freed up.

The same argument applies to access to foreign exchange to purchase products.

Those who have invested do not have this access to foreign exchange at the lower exchange rate. Should they try and import the deregulated products at the higher

Thursday 24 January 2019

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31

GARDEN CITY BUSINESS DIGEST Encounter with Rotary Intl’s Barry Rassin, and how polio was again kicked out of Nigeria IGNATIUS CHUKWU

T

wo major milestones were recorded by Rotary family in Nigeria in 2018 especially the visit of Bahamas-born Barry Rassin, president of Rotary International. The other is crossing the hedge of stamping off of polio in Nigeria for two consecutive years for Nigeria to once again by August 2019 as polio-free country.

The RI president also performed a major function of unveiling 337 graduands from a skills acquisition programme executed by Rotary in Port Harcourt. Rassin’s visit seemed to paint happiness around the country starting with a handshake with President Muhammadu Buhari at a time many said he was a clone, hope for children in the North East for exit of polio, and commissioning of empowerment to youths in the Niger Delta.

There was a press conference in Hotel Presidential attended by top Rotary personalities in Nigeria such as Yinka Babalola (Rotary International Director, Africa), Adeomi Oladogun (District Governor 9141), Virgina Major (District Governor nominee), Ibim Semenitari (president, Rotary Club of ); and Funso, past district governor in charge of Polio plus. Most of them including Rassin were with their wives.

District 9141 consists of 59 clubs in four states (Bay-

elsa Rivers Edo Delta), and over 2000 Rotarians. The significance of Rassin’s visit was captured by Babalola who said Rotary exists in over 200 countries and if any country is picked for visit by the international president, it was a huge honour. “That shows value for that territory and we are happy that President Rassin chose Nigeria as one of those to visit. As the one taking the messages to him, it makes it easier that he visits to see the source of the reports he gets.

That is good for me and for Rotary in Nigeria. We expect more action as he departs.

Every community that has Rotary will feel his impact.”

On security concerns ever present in Nigeria, he said; “Wherever you have friends, you have no problems. Even if his country (Bahamas) blacklists a country, the Rotary president can rely on his friends to act wiser and even give advice. His visit will improve our membership and increase our drive. It will help boost our status in the international Rotary community.”

Key revelation was that Nigeria is free from polio and would soon be certified.

Funso, head of Polio Plus in Nigeria, who had a year before said Nigeria had polio, said it is believable to be said to be polio-free again. “Yes, before we could not access 14 LGAs two years ago but now there is no LGA we cannot access when where we cannot go even with military escort, military personnel do it for

Barry Rassin

us. We have taught them how to inject the children. Reaching everywhere in Nigeria to pick up cases of paralysis and confirm the cause is not polio.

This gives us confidence that polio is out.”

He said there is vaccine derived polio. “In other words, when you have an environment when children are not fully covered and they are malnourished. Remember that the vaccine first settles in the stomach to multiply and create immune cells which also protect the child against wild polio. If it circulates for a long time where children are malnourished kids, it

undergoes mutation and can cause paralysis. That has not affected the programmes in anyway. We do not want any child to be paralysed. It happens in some countries and that does not put them back on the list of polio-endemic countries. Our target is to reach every child with immunization.”

Rassin who arrived Nigeria on Thursday, November 15, 2018 in Abuja, released 337 graduands of entrepreneurial scheme equipped to go into full employment with skills and confidence. The graduands were charged to go into the communities and

train others.

Accompanied by his wife, Esther, the international president in charge of 200 counties and 1.3 million members was apparently excited by the full community involvement in the project located at Rumuoprikon centre with the paramount ruler, all his chiefs, and the community executive in attendance.

Rassin said the project was fish to the 337 entrepreneurs for life and urged them to stand by the professions that they chose. He spoke after he conducted a thorough inspection of the stands ranging from beads, hair-design, bag designs, art work, telephone repairs, batic, etc.

Earlier speakers such a s C ha r l e s Em ma - Wo ke explained that Rotary had made huge impacts in Rumuoprikom area. The community leader and elder, Kingsley Owabie, gave account of Rotary impact in the community. The paramount ruler, His Royal highness, the Eze, Barr y Amewhule Oparauwadie, dressed up Rassin in Ikwerre attires.

Questions for Rassin: Ib i m S e m e n i t a r i w h o moderated the press briefing cautioned against political questions and thus the interview progressed without bumps, thus: What will your visit do to Nigeria when you leave?

If I do my work right the way I think I have done, I

would have motivated the Rotarians here to continue to support the foundation and to grow the size of Rotary worldwide, making sure there are people to carry on with the task of making the world better. It is a vast growing area of Rotary.

Out there, how do they perceive Nigeria in terms of Rotary work?

When I talk about polio work in the world I always refer to Nigeria because despite the challenges of the economy, conflicts, etc, but the Rotarians continue to make sure that polio is eradicated. I have great respect for what they are doing here.

What are the challenges of polio eradication in places like Pakistan and Afghanistan because Rotary says polio is not eradicated until the last country is polio-free?

We have 27 cases in the two countries compared with 350 we had there when we started the work. We made significant progress but we cannot stop there as we continue to meet with governments. We do everything we can to eradicate polio especially at transit points because there is a lot of back an forth in Pakistan and Afghanistan. We continue to immunize the children especially at the transit camps.

It is not about going to the next phase but continuing to immunize the children.

The problem is at the border between those two countries.

Create what you want; My Nigeria is the best country – Lara Joseph

Port Harcourt by Boat With

IGNATIUS CHUKWU

I

s it true that you can create the kind of world you want with your word; this includes the kind of wife, husband, children, job, government, etc you want?

The World was created with the Word, so says an African proverb. So, most Africans believe that whatever you decree with your mouth and harp on it repeatedly, that will come to reality. Thus, most parents (especially mothers) try not to be saying, Emeka, you will never succeed; you are a failure; you will die, etc.

So, on this Sunday, our Area Mummy (Lara Joseph of RCCG, Redemption Hall Model Parish, RHMP, Elelenwo in PH), admonished us to stop creating a polluted country with our mouths. She rejected our habit of joining others in a bus or gathering to bash Nigeria from morning till night everyday, thus; Nigeria is useless; Nigeria will never develop, Nigeria is doomed; Nigeria is baaaad; Nigeria’s economy is the worst; the president is baaaad; the president is useless; the president or governor is wicked; he is cursed; etc’. The president will yield such to you, the country will yield such evil fruits to you because you can’t pluck good fruits from an evil tree.

From Christians, she demanded them to rather seek to turn around the fortune of the country or state where they reside with positive utterances. To her, Nigeria is the best country, Rivers State is the best, Imo is blessed, Abia is God’s choice for me,

etc. It is what you sow into the land that it brings back to you. If you keep saying Nigeria is useless, Nigeria is gone, Nigeria is this bad; it will be useless and fruitless to you and your children. Say, Nigeria is good and beautiful but it can be better. The president or governor is the one given to us this period, he is blessed, he is trying, but he can be better. So, recreate your world with your mouth, she insisted. You can even point out where the country, the president or the governor

Mummy Lara’s spiritual daughters

needs to do better.

Mummy Lara as we call her made it clear that she has no interest in any of the presidential candidates and she is not a politically exposed pastor. Her point is that a true Christian living a spiritual life would not have to hope on whether it is Buhari or Atiku to make progress. It is rather the duty of children of God to utter positive words on the country to recreate it and water it, not to always pour invectives and curses on the land and the leaders.

God did not make a mistake to locate us in Nigeria. Praising other countries all the time but repeatedly pouring negative words on Nigeria is not good for Christians who know that their tongues are ordained.

She reminded us that many of those rushing abroad end up washing corpses and pay huge tax on the income, only to return to Nigeria with their savings to form ‘big boy’. In Nigeria, at least you are not washing corpses, yet, we curse the land everyday in angst. The land has bountiful resources and limitless freedom of speech, but we only see what God put in other places and curse our destinies for being placed in Nigeria, she fumed.

It’s what you call Nigeria that it will answer and yield to you. For us in RCCG in PH, we have chosen to call Nigeria blessed, good, wonderful, so that it will yield good and wonderful fruits to us.

For 2019, we may falter and fall but we will rise and

win. She showed us Proverb 24:16 where it was stated that a just man can fall seven times but will rise; but a wicked man may fall but fall into mischief. Mummy Lara explained that falling and rising means taking stock of one’s mistakes when down, going to God in prayer for solution, seeking solution from experts and mentors, and having the faith that would lift one up again. Falling into mischief is when one falls and decides to resort to negatives such as alcohol, drugs, stealing, etc, to reduce the pains instead of using the opportunity to build stronger character, taking stock, and fight back.

A prisoner can review the circumstances that led him to that place and come out a better person and win again. Another may join in drugs and evil and come out a hardened criminal. The difference is in your hands.

That is what Solomon was trying to communicate in Proverbs 24:16.

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Thursday 24 January 2019

Investing in Rivers State Rivers debate:

Not a kobo from politicians – Bobmanuel • Traders, artisans, fishermen and farmers will participate from their locations • Business issues must decide choice of next governor Stories by Ignatius Chukwu

T

he debate group midwifing the upcoming governorship debate in Rivers State slated for February 13, 2019, has made it clear that no politically exposed person was allowed to contribute a dime to the funding of the debate slated for February 13, 2019.

Addressing newsmen in Port Harcourt, the chairman of the debate group and president of the Rivers Entrepreneurs and Investors Forum (REIF), Ibifiri Bobmanuel, CEO of a group of companies including construction, car sales and now tractor manufacturing, said the partners and members of REIF alone sourced the funds.

He said media partners including BusinessDay, Silverbird, Rhythm, CoolFM-Wazobia-Nigeria Info were helping with publicity while members of REIF had agreed on amounts to chip in. Other partners include SDN, Enough Is Enough, Social Action, etc. The essence, he said, is to provide a level-playing ground for chosen governorship candidates that would be allowed to appear on the debate platform that is already creating huge vibrancy.

The business guru with many foreign contacts and partners said REIF had always funded its activities over the years without seeking funds from the state government and politicians in order to maintain its independence and neutrality. “The trust and belief they have on the potentials in Rivers State is overwhelming. They have been putting up funds, time, pages and air space to support worthy cause for the economy of the state. It is humbling. We have been having meetings on weekly basis.”

Bobmanuel who read engineering in the Ahmadu Bello University (ABU), Kaduna, and cut his business teeth in the North where he made

Rivers Debate Organising Team: L-R: Giandomenico Masari, Odoliyi Lolomari, Ibifiri Bobmanuel, Flora Asieri

huge business contacts nationwide remarked that the business community in Rivers State was eager to know the economic direction of whoever would govern the state from May 2019. He said traders, artisans, business owners and investors in the state have been mobilized to participate in the debate series that started in 2015 to make incisive and informed voting decisions right from where they are in their shops, markets, company premises, and in the hall.

He said whereas about 200 guests were admitted in 2015, this time, it would be over 500, and the more media partners have signed on to be part of the debate.

On the vexed issue of candidates of the embattled All Progressives Congress (APC) in the state, he made it clear that the courts and decisions of the Independent National Elections Commission (INEC) would inform what the debate committee would do.

On choice of parties to send guber candidates, he said the media committee was running a public poll on

who is visible enough to participate, saying the main committee made up of top citizens would look at the names suggested by the poll.

He said another committee was vetting questions being harvested across the state but that candidates must be prepared to put out their plans and manifestoes clearly and show a viable economic plan to take Rivers State to higher levels.

The debate group had issued communiqué in 2015 on major policy issues expected of whoever would win that time and Bobmanuel said now that the candidate that eventually won (PDP’s Nyesom Wike) has so far executed and complied with most of his promises. He said that business were like Oliver Twist who always wanted more.

He said the INEC Resident Electoral Commissioner (REC) in the state is going to be the only person on that day to have the opportunity to give a 15-minute goodwill message. The debate is being planned very well.

Bobmanuel said: “We have been able to make some kind of contacts

with the political candidates and it is quite positive so far. We would have a robust debate because that is the only way we can grow the economy of Rivers State and Nigeria. The way we can grow our democracy is when we begin to bend towards ideology, issues and policies. That way, we get the best out of our parties and our democracy. The debate is a starting point for the elucidation of ideas and ideologies. If you want to be governor, fine and good, but you need to tell the Rivers people why you want to be governor.”

On the certainty and credibility quotient of the debate, he said: “We have very prominent individuals in our country and state that are part of the debate. These are role models with huge credentials at stake. We cannot toy with their reputations just for one individual or group. We have the likes of the monarch, the first governor of Old Rivers State, His Royal Majesty, Alfred Papapriye Diete-Spiff who is the chairman of Board of Trustees of the Rivers Entrepreneurs and Investors Forum (REIF); the chief, Odoloyi Lolomari, one time GMD of NNPC as his assistant on the board of REIF, etc.

They are keenly and closely following this debate process.”

He made it clear that for the south-south and south-east economy to work, the Rivers economy must work. That is why anyone aspiring to govern Rivers State must have a robust economic policy for the state and present it clearly.

“Now, for you to assess where you are going to, you must understand where you are coming from. If you look four years back, during the twilight of the last election, there was hue and cry that violence was coming to the state and region. You will agree that the elections came and went without that level of calamity, but we have been able to drive the region from where we were to where we are today. You will agree with me that it is important that we drive that process even more, and stretch

it even harder. We are going to stretch the candidates even further to scrutinize and get the best candidate with the clearest of head to run the state for the next four years.

In getting that candidate we need to get into their heads and minds to know this. How else could we do this other than the debate? That is why the debate has come to stay. As we speak, questionnaires are going round the state in different sectors to get the questions. The debate will be aired live and all peoples will participate; in the rural areas, in the markets, all will participate. We will love to get questions from the streets, markets, fishing ports, from oil locations/rigs, constructions sites, etc. They will ask questions even if they do not come physically.

The way it is structured, it will be live on radio and television. In the comfort of your house or location, you will still be part of the exercise.

At the end, you will be rest-assured that whoever is the winner will be able to govern the state and take us to where we want to be.”

He said questions cannot be sent to candidates in advance because they must show their levels of preparation especially their economic policies. “The questions are actually the key because we would want to know how prepared they have been, but we are definitely not sending questions to them. If you really wanted to govern a state, you would have thought through what you wanted to do, the problems of the state and how to handle them. You would have your think-tank to look at the problem of investment into the state, how to attract more investors, how to improve upon the livelihood of people, how to get more businesses to employ more people, and several other issues that should be agitating the mind of any person wanting to govern Rivers State.

We expect that they would each have a manifesto. It was sacrosanct last time and it must be this time, too. our votes must not be for sale.”

Gabriel Toby: The Hero of Opobo • How he made Opobo to be in Rivers State •He got a LGA for his people, ... groomed many on due process and dignity of labour

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e have heard of King Jaja of Opobo, now we are hearing of the ‘Hero of Opobo’. While Jaja of Opobo is known for founding Opobo from Bonny Kingdom and creating an economic state, the ‘Hero of Opobo’ fought for Opobo away from Akwa Ibom to Rivers State and helped them get a local council autonomy. He paved the way in the Rivers civil service for most Opobo elite and used credibility and Christianity plus generosity through Rotary to create new elite of world class reputations and acceptability. He is Gabriel Toby, the Knight and Benevolent, who clocked 80 last Saturday, January 19, 2019.

Toby, father of Nigeria’s female media icon, Ibim Semenitari, was toasted to high heavens at LA Kings on Stadium Road in the Garden City as Opobo royalty and regalty mixed

well in a temple of friendship and fun, laced in reverie.

It began with golf game the previous day and a church service on the day. The grand finale then moved to LA Kings where few men of honour tried to capture Toby in a running prose. The chairman of occasion, a professor emeritus, Dagogo Fubara, said: “66 years ago, we were growing up together. Mine is eye witness account because he has been my brother for 66 years. There are few things the profile did not mention.

Toby stabilized Opobo students union in 1953. He helped to make Opobo not to be in Akwa Ibom through his contributions to the boundary adjustment panel that made Opobo be in Rivers State. He is also the architect of Opobo/Nkoro local council creation.”

Gini Major, the visible force in the world of pharmacy and Rotary said;

“Being a sister to Sir GTG Toby is not mere fun. He is the huge tree with many branches. He is a model and a source of inspiration.”

What they say behind Toby - Da-

Gabriel Toby

kuku Peterside “Today, what I want to say is what they, especially young people, say behind him.

Those who do not like order see him as too strict. Those who do not like procedure see him as ‘Mr Due Process’ (even call him De Due Process). Those without a sense of history see him as too rigid or as someone who does not let go, someone ready to pay any price for his conviction. Those who are lazy see him as too stingy.

“Sir GTG Toby is truly highly respected and is a father to a whole generation. He has raised very many persons and is a source of encouragement to us, a dream father and dream husband. Many young men of my stage wanted to be like him, but not his hard work and the price he paid.

We just want the blessings of God on him and favours.”

Profile of a hero Toby is chairman of the board of governors of Archdeacon Brown Education Centre (ABEC) with four schools from nursery to secondary.

His father was a successful oil merchant who settled at Owerrinta in today’s Abia State and traded along the Waterside near Aba. He schooled at Okrika Grammar School and St Augustine’s Grammar School, Nkwerre to come out with Grade One in his college result. He read Economics at the University of Nigeria, Nsukka (UNN) and holds an honorary doctorate degree in Public Administration.

He was a versatile public servant in the civil service of Rivers State serving as permanent secretary or director in over 15 ministries. He served as prochancellor of two federal universities, Uniport and Uniben.

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Nigeria telecoms sector to benefit from emerging Ghana outpaced Nigeria to become biggest techs with NCC, universities partnership JUMOKE AKIYODE-LAWANSON

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he Nigerian Communications Commission (NCC) is making plans to boost the country’s telecommunications sector with its partnership with the Federal University of Technology (FUT), Minna, and other tertiary institutions on research into emerging technologies in the telecoms industry.

Umar Danbatta, executive vice chairman of NCC, made this known during a press conference on the sidelines of roundtable with academia, industry and other stakeholders in the North Central region, in Minna, Niger State, on Wednesday.

Danbatta, represented by Austine Nwalune, the director of spectrum administration, NCC, pointed out the academia as a very important stakeholder in research and development, saying there cannot be any growth without research.

“For growth to happen you need research into emerging issues and emerging technologies that is why we partner with the academic institutions, which are the home of those research and development efforts. The

universities are institutions of research, that is their core area. So, partnering with them enables them to do what they can do and do it best,” Danbatta said.

Similarly, Ephraim Nwokonneya, the commission’s director of research and development, highlighted exponential growth recorded in the telecommunications sector since 2001, underscoring the need to deploy research and development to tap enormous potentials in the sector.

According to Nwokonneya, “Telecommunications have facilitated enormous growth and development in the ICT sector and we believe that such growths need to be sustained. We believe there are more potentials that we need to tap and that there are a lot of potentials in the academia that we can leverage on.”

Abdullahi Bala, vice chancellor, FUT, Minna, sought NCC’s partnership for the establishment of a centre for emerging technologies in its campus, saying the largely ICT-based centre would address issues such as cybersecurity, cryptocurrency, digital policing and forensics among others.

recipient of FDI inflows in West Africa in 2018 ISRAEL ODUBOLA

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nited Nations Conference on Trade and Development (UNCTAD), in its report titled ‘Investment Trends Monitor,’ released last Monday, says Ghana, having received Foreign Direct Investment (FDI) inflows worth $3.3 billion in 2018, overtook Nigeria to become the largest recipient of FDI in West Africa.

FDI inflows to Nigeria fell by 36 percent to $2.2 billion in 2018 from $3.5 billion in 2017.

However, the country reported significant greenfield investment project announcements in the oil and gas and chemical sectors.

This is the second consecutive time Nigeria registered a decline in FDI inflows. In 2017, FDI inflows went down by 20 percent to $3.5 billion from $4.4 billion in 2016.

Commenting on why the country recorded a two-time decline, Emmanuel Noko, lead economist at M&C Research Institute, told BusinessDay that the decline was largely connected to the challenges the economy was facing such as weak growth, heightened political uncertainties.

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Lagos-Ibadan standard gauge train to begin partial service February MIKE OCHOONMA

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here are strong indications that the laying of tracks on the 152 kilometre Lagos-Ibadan standard gauge rail project from the Abeokuta axis will soon get to Iju, Lagos, by the end of January, thereby opening up partial passenger train on the new standard gauge corridor between Lagos and Ogun states, according to the Nigerian Railway Corporation (NRC).

Fidet Okhiria, managing director/chief executive of NRC, said on Wednesday while conducting journalists at Ijoko during an inspection tour of the project.

Okhiria said with the laying of tracks by the Chinese Civil Engineering and Construction Corporation (CCECC) from DK 79 Abeokuta, already in progress, the contractors was working towards the completion of another 10-kilometre distance to DK 23 Iju, about 56 kilometres.

On the exact amount

of compensations so far paid to owners of properties destroyed for right of way (RoW) along the corridor, the NRC managing director said, ‘’So far none of the property owners are complaining anymore as the Federal Government have started settling those affected except that after some of the elites among them have collected money, they will go back to court saying that the money is not enough.’’

Okhiria said that with the sequence the CCECC is going, that is from Iju to Ijoko, the formation for track laying by CCECC is ready, and after the stone, they will put the ballast.

Meanwhile, is still expected that, with the Chinese contractors laying 1.5 kilometres distance of track everyday, it is expected that by the end of January, laying of tracks from Ijoko to Iju would have been completed.

With the expected completion of tracks laying job from the DK 79 at Abeokuta to DK 23 at Iju in Lagos state by the

end of January, the contractors will be faced with the arduous task of completing tracks laying from Iju to Apapa port complex which is very crucial in the easy movement of goods and services out of Lagos that is bedevilled with traffic gridlock caused by the movement of tankers and trucks moving containers in and around the seaport.

This implies that, passengers can make a return journey between Iju in Lagos state and Abeokuta in Ogun State on the standard gauge rail service, and open up the corridor up for other economic and social activities.

Many political watchers in the country believe that with the priority attention given to the project by the Federal Ministry of Transport and the intensity of work, the President Muhammadu Buhari administration is using the ongoing LagosIbadan standard gauge rail project as a campaign tool to win more votes for his second term bid from the Southwest.

34 BUSINESS DAY NEWS How Agric Ministry’s shoddy management...

Continued from page 1 But compared with 2016, the 2018 figure represents 75 percent rise.

However, wheat farmers churned out less than 300,000 metric tonnes nationwideattheendof2017/2018farming season. That represents over 52 percent declinefrom625,000metrictonnesduring 2016/2017 season and 25 percent drop from 400,000 in 2015/2016, said Oluwasina Olabanji, executive director, Lake Chad Research Institute.

Impeccable sources familiar with budget matters in Agric Ministry told BusinessDay that a couple of top government functionaries who should champion the implementation of projects allotted to these funds have only sat on it and are likely to have engaged in a sharing spree among themselves, with the minister of agriculture hardly showing any interest in what has been happening to the growth or decline of wheat sector.

“Someone is frustrating the wheat programme,” the source said. “One director and two consecutive permanent secretaries who ran the show between 2016 and third quarter of 2018 know how they have spent that money budgeted for wheat. The person in charge of wheat knew about how the wheat money has been spent in two consecutive wheat growing seasons.”

The source said the director in charge of Federal Department of Agriculture should shed light on what happened to the money because wheat programme is under his portfolio.

“People are lobbying not to move from that ministry,” the source added.

Asked about the landing points

of these funds, Amin Babandi, director at the Federal Department of Agriculture, was evasive throughout a phone interview, saying questions should be channelled to the ministry’s state director in Lagos.

“I don’t want to answer those questions now. But let me advise you.

In each of the states we have a director from the ministry. So the way you found my number, try and find the number of who is the state director for Lagos. The state director knows everything and will link you up with whoever is meant to answer,” he said.

“We have never, ever received any intervention from the Federal Government of Nigeria except during the Growth Enhancement Scheme (GES) programme under Goodluck Jonathan, when seeds were distributed to farmers,” said Salim Saleh, president, Wheat Farmers Association of Nigeria (WFAN).

“Since it stopped, nothing like intervention came to wheat farming,” Saleh added.

There are insinuations that in the past three years, the Federal Ministry of Agriculture has unusually concentrated on procurement issues, which suggests a widening window for outflow of funds without execution of projects that truly impact the agricultural sector.

This means so many funds have gone into irrelevant projects.

Under the 2016 budget, a N4.2 million provision was made for foundation seeds, tagged ‘on-going project’. For certified seeds, the Agric Ministry budgeted N154 million. It also devoted N66 million for inor-

C002D5556

ganic fertiliser and N78.7 million for procurement of 400 multipurpose threshers at N650,000 each. Support for 187,500 farmers was said to cost N1.3 billion while the development of high-yielding varieties of wheat and barley was budgeted at N93.5 million.

Again in 2017 budget, N2.6 billion was budgeted for promotion and development of wheat value chain, among other projects such as supply of agro-processing equipment, multipurpose thresher, reapers, rice/wheat de-stoners, dryers and maize harvesters valued at N1 billion.

Similarly, under the 2018 approved budget of the ministry, N2.6 billion was tied to the development of wheat value chain pegged on-going. Research for seed multiplication and mini seed increase for wheat alongside soybean, groundnut, and cowpea was a new project requiring N15.2 million.

Development of high-yielding heat-tolerant and good quality varieties of wheat and barley; development of early-maturing and high-yielding millet varieties with good processing quality and development of the capacity of scientists, farmers and extension officers in wheat and millet production, processing and storage were said to cost N226 million.

A total of N106 million was devoted to wheat value chain development training.

The only government support to wheat farmers in recent time has been the Anchor Borrowers Programme, which is a CBN initiative to push the government’s agricultural diversification agenda. It was only received towards the end of 2018.

“CouldtheCBNprojecthavesprouted because the Ministry of Agriculture

was failing to deliver?” an analyst asked.

Wheat farmers received inputs such as seed and fertilisers, farm machineries (threshers, water pumps) and support for research and development from Flour Millers Association of Nigeria (FMAN) in 2018.

Nigeria’s failure to move up its ranking as 18th on the world index of wheat production comes as a paradox.

When world leader by yield, New Zealand, achieved a record 10 metric tonnes per hectare and African counterpart, Egypt, had 6.6 metric tonnes per hectare, Nigeria’s wheat production yield has been a struggle between 2.1 and 2.5 tonnes per hectare.

Wheat consumption is projected to hit 5 million metric tonnes during the 2018/19 period, a 5 percent increase over last year. Countries with 3.1 tonnes yield per hectare, including the United States and Russia, are prepared to exploit that opportunity.

There are fears that the country’s

Thursday 24 January 2019

wheat import expenditure could double by 2025.

In a recent letter to FMAN, Olabanji highlighted the clog in the wheel of wheat production and self-sufficiency in Nigeria, saying political will and commitment of government’s intensive interventions were lacking in the commodity once identified as a priority crop in Nigeria.

He noted also that reduction in the total area put into wheat cultivation in the wheat-growing states was another bane contributing to the production decline.

The troubling question among stakeholders, therefore, is the whereabouts of these funds since the only body of wheat farmers in the country cannot point to projects benefitted from any government intervention during these periods, either in the form of finance, subsidy of farming implements, improved seed breed or mechanisation equipment.

Nigerian art market records N400m from...

Continued from page 2

artists out of which about 2,000 have been acquired.

Art635, a CSR initiative of Guarantee Trust Bank, also woos buyers of artworks because of the security the bank offers in the transactions.

The easy-to-use platform showcases several works, offers payment options and safe delivery as well.

However, Artyrama, a startup, has become the online African art gallery. It has given many people across the world access to a variety of African art, leveraging cutting-edge technology to provide a seamless, carefully curated online experience.

The startup provides advisory services for anyone looking to buy and sell art, drawing on strong industry experience in the African art market.

Sola Masha, Artyrama’s general manager, said the platform is gaining huge mileage today because it has introduced art to people who have never experienced or acquired art from Africa, as well as people who have an interest in the African art world but do not have a user-friendly platform from which to experience it.

ArtXLagosisalsomakinganimpact with its yearly art fair in Nigeria’s commercial hub where visitors are allowed to acquire artworks of their interests according to their financial reach.

But while the auctions sales are impressive, many art stakeholders insist that auctions, fairs, and galler-

ies are a small slice of the Nigerian art market, with less than 10 percent share of the entire volume of artworks sold in the country.

“Yes, auctions have become a way to gauge the prices of Nigerian artworks, but they contribute a small part of the volume of works traded in the country in the year. Many people buy art anywhere even in traffic and such records are not captured,” Ade Olakunle, an art collector, said.

Emeka Ossy, an art teacher, said most galleries visit art schools to look for graduating artists who offer their works at giveaway prices, some go to roadside artists and a few visit art studios to do personal bargains that are never recorded anywhere.

“So, the total sales in a year may be over N1 billion. Yes, because nobody captures the ‘black market’,” Ossy said.

Many see a better year ahead for the arts in 2019 with more exciting works, emergence of new artists, consolidations by master artists, more platforms and many new art lovers and collectors.

To boost patronage of arts this year, Kavita Chellaram, founder, ArtHouse Contemporary Limited, said, “We need to do more to educate buyers on the value of African art, so that they won’t just collect artists they are familiar with. They need to realise that they have to go broad in their collection and begin to think world and not just Nigeria when collecting.”

Real reasons over 40% of houses in Apapa...

Continued from page 2 L-R: Jacquelyne Yawa, head of agribusiness, Guinness Nigeria; Audu Ogbeh, minister of agriculture and rural development; Yoila Hanabi, best performing farmer 2018 farming season; Baker Magunda, MD/CEO, Guinness Nigeria, and Viola Graham-Douglas, corporate relations director, Guinness Nigeria, at the launch of Guinness Nigeria Agriculture Scheme themed “Grow With Nigeria” at Transcorp Hilton Hotel, Abuja.

Rwanda seeks to jumpstart eCommerce...

Continued from page 1

commerce through the trading

platforms has “democratised benefits” of global trade.

Jack Ma, executive chairman, Alibaba Group Holding, noted that many countries provide incentives and benefits for large companies to participate in global trade; however, small and medium-sized enterprises (SMEs) often get left behind.

“We think there should be free trade zones for small businesses,” Ma explained. He views the trading platform as a means to level the playing field for young people and SMEs to give them direct access to global markets.

Rwandan coffee growers have already seen the advantages. Ma noted that the platform initially offered 2,000 bags of coffee for sale, and the

merchandise sold out in three days.

He projected 200,000 coffee packages would sell this year.

Having direct access to Chinese markets means higher profits and the elimination of intermediaries for the coffee farmers.

IsthereariskthatRwandawillcome torelytooheavilyonasinglecompany’s electronic platform? Kagame reported that as long as the technology brings job opportunities and revenue to the Rwandan people, he isn’t worried about diversifying the technology.

In the future, Ma predicts that the platform could offer a way to increase digital commerce within Africa.

Currently, the technology connects Rwanda to Chinese buyers and sellers; however, Ma hopes to add other African countries to the network, which

would facilitate intra-African trade.

Increasing intra-African trade is already a goal of many nations. Last year, 44 nations signed on to join the African Continental Free Trade Area, which would reduce tariffs and other barriers to intra-continental trade.

Ma sees the technology as helping better distribute the benefits of globalisation: “A lot of people don’t like globalisation,” he said. “But we believe in globalisation.”

The World Economic Forum Annual Meeting brings together more than 3,000 global leaders from politics, government,civilsociety,academia,the arts and culture as well as the media.

Convening under the theme, Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution, participants are focusing on new models for building sustainable and inclusive societies in a plurilateral world.

(akara) or roasting plantain (boli), has led to the degrading of the environment which, in turn, has led to a significant reduction in property value.

“Vacancy rate in Apapa has risen significantly by almost 50 percent and this is because there are no new investments in that part of town,” Chudi Ubosi, an estate surveyor and valuer, told BusinessDay. Ubosi said Apapa was in the league of Ikeja GRA, but whereas a standard plot of land in Ikeja GRA goes for between N150 million and N200 million, a seller of the same size of land in Apapa would struggle to get N100 million as price for the property.

An estate manager who identified himself simply as Uche agrees, explaining that the only people who are still in Apapa are those who have their children in school there or whose businesses are located in that area.

Uche, who said he has been doing real estate business in Apapa in the last two decades, noted that property value in Apapa has come down to a point where a buyer can easily get 2,500 square metres for as ‘low’ as

N150 million.

Though this offers investment opportunity for savvy investors, Uche said, “The situation is as bad as that.”

He pointed out that house rents have also dropped significantly, from N5 million per annum two years ago to between N3 million and N3.5 million. “In some locations within the GRA, you can rent a house for N2.5 million per annum. And that is if you see tenants,” he said.

He blamed the Federal Government for the state of the property market in Apapa, saying that government shouldn’t have allowed the reconstruction of the Apapa-Wharf Road being undertaken by Dangote Group, Flour Mill of Nigeria and NPA to happen at the same time with the repair of Ijora Bridge, more so when the Apapa-Oshodi Expressway has been rendered impassable by trucks.

Ayo Vaughn, chairman of Apapa GRA Residents Association, in an interview with BusinessDay lamented how the situation in Apapa was denying property owners rental income, estimating that 40 percent of the entire buildings in the Apapa GRA were empty.

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Electoral Act: Why National Assembly could not override Buhari’s veto - Saraki OWEDE AGBAJILEKE, Abuja

S L-R: Edward Nkwegu, APC chieftain Ebonyi State; Eze Nwachukwu, Eze Ndigbo Isolo; Onu Prince Nweze, APC senatorial candidate Ebonyi South; Bisi Akande, celebrant; Festus Odii, APC House of Representatives candidate, Ohanivo Ebonyi State, and others, at the 80th birthday celebration of Akande in Ibadan, recently.

CBN imposes N1m sanction on banks for payment of counterfeit banknotes from ATMs HOPE MOSES-ASHIKE

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entral Bank of Nigeria (CBN) on Wednesday said it would impose a penal fee of N1 million per branch of Deposit Money Banks (DMBs) for payment of counterfeit banknotes from ATMs/teller points.

In a circular signed by Priscilla Eleje, director, currency operations department, CBN, the regulator also said it would carry out spot checks on banks ATM and teller points to ensure compliance of banknote fitness guidelines and clean note policy.

This development follows the CBN’s observation with concern the incidences of counterfeits paid through banks’ ATMs/teller points.

To address this among others, the CBN in collaboration with key currency management stakeholders developed

… releases banknote guidelines, clean note policy banknote fitness guidelines and clean note policy documents for the industry.

Also on Wednesday, the CBN released the banknote guidelines and clean note policy document intended for the use of all cash handlers at such DMBs; Micro Finance Banks; third party service providers and general public. All cash handlers are expected to comply with the quality standards as set therein to sustain public confidence in the national currency.

The Nigerian Currency Structure comprises eight banknotes and three coin denominations in circulation. They are the N1000, N500, N200, N100, N50, N20, N10 and N5 banknotes as well as N2, N1 and 50k coins.

The four higher denomination banknotes are print-

ed on paper, while the four lower denominations are on polymer substrate.

The objective of a banknote fitness standard is to ensure the banknotes meet the expectation of the public in terms of cleanliness and appearance; ensure the basic security features on the Banknote remain visible and are easily recognised by the public to deter counterfeiting; and facilitate automated dispensing, counting and sorting of banknotes.

According to the CBN, demand for cash continues to grow despite technological advances. Consequently, the volume of currency in circulation as at end 2012 rose significantly by 10.34 percent to 7,914.70 billion pieces, as at half year of 2018.A large proportion of the notes in circulation were

dirty and mutilated and not fit for ATMs and over the counter payments, CBN noted.

The Clean Note Policy enunciated by the Bank, entails a spectrum of diverse currency management activities geared towards the efficient circulation of premium quality banknotes and withdrawal of unfit/ soiled banknotes to guarantee public confidence and usage of the Naira banknotes as a medium of exchange.

As part of its statutory task for the issuance and management of legal tender currency in Nigeria, the CBN formulates and issues the Clean Note Policy. It ensures that Nigerian banknotes are of high quality, clean and are used with the highest confidence by the general public and retailers in banknotes.

International Education Day: Nigeria out-of-school children figure still highest KELECHI EWUZIE

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igeria’s over 13 million out-of-school children record is still the highest as the world celebrates the maiden edition of International Education Day programme, today, January 24.

United Nations General Assembly in 2018 adopted the International Education Day to bring together the voices of governments, the UN system, and the private sector and youth organisations.

The event’s theme “Education: A Key Driver for Inclusion and Empowerment” echoes the focus of the UN High Level Political Forum that takes place in New York this July, which will review SDG4, among other goals.

Educationists observe

that the pitiable state of primary and secondary school levels of education in Nigeria is characterised by overcrowding in schools, reduced quality of staff, inadequate facilities in school, etc. Above all, there is the problem of an absence of an academic standard that will develop pupils who are at par with their counterparts globally.

The Federal Government has not spent up to 15 percent of its total budget on education in the last 10 years of uninterrupted democracy. The highest allocation so far was in 2008, when it allocated 13 percent.

They observe that this pattern of allocation, as mentioned-above, which is below the UNESCO’s threshold that is 26 percent of the total budget, is certainly af-

fecting the implementation of government’s policy on education and in particular the Universal Basic Education since its inception.

According to them, basic education, which is the entry point in the education value chain, lacks all the four-key school-level ingredients for learning: prepared learners, effective teaching, learning focused inputs, and the skilled management and governance that pulls them all together.

The day will be marked at the United Nations in New York, in an event co-organised by UNESCO and the Permanent Missions of Ireland, Nigeria, Norway, the Republic of Singapore and the State of Qatar.

Today, 262 million children and youth still do not attend school; 617 million children

and adolescents cannot read and do basic math; less than 40% of girls in sub-Saharan Africa complete lower secondary school and some four million children and youth refugees are out of school. Their right to education is being violated and it is unacceptable.

Ejike Uchechukwu, an education analyst, tells BusinessDay that the issue of out-of-school children is very serious that any forward-looking country should take serious.

He says affording millions of Nigerian children access to quality learning resources that promote, engaged and effective learning not only aids the learning process, the provision of these resources themselves is often enough to entice learners into the classroom and lastly.

enate president, Bukola Saraki, has explained why the National Assembly could not garner the required two-third majority to override President Muhammadu Buhari’s veto on the fourth version of the Electoral Act (Amendment) Bill.

Saraki, who spoke on Wednesday on a live television programme on African Independent Television (AIT), attributed the inability of the National Assembly to override the President’s veto to the division of the Legislature along party lines.

Saraki, who doubles as director-general of the PDP Presidential Campaign Council, argued that President Buhari could have risen above partisanship to sign the bill, aimed to reform the nation’s electoral processes.

Section 58 (5) of the 1999 Constitution stipulates that two-third of both legislative houses (73 senators and 240 members of House of Representatives) must be present to override the President’s veto.

Specifically, the section reads: “Where the President withholds his assent and the

bill is again passed by each House by two-thirds majority, the bill shall become law and the assent of the President shall not be required.”

But speaking on the television programme monitored

by BusinessDay, Saraki said: “It’s something that we realised that we didn’t have the numbers to do that (override the President’s veto). It was clear that people (lawmakers) in the National Assembly had taken positions along party lines. APC legislators were supporting their President.

They have elections and I don’t think they will go against their President. There was no way we could have got the veto. But it is not about the veto.

“I think the President should have risen beyond the politics and election and look at prosperity and signed it in the interest of the country and what is right. He acknowledged that it was a good bill and he said let that bill be signed after his election. I think he should have risen above that and signed the bill.”

It would be recalled that President Buhari had on four occasions in 2018 declined assent to the bill passed by the National Assembly.

VAT hike likely as FG retools revenue strategy ONYINYE NWACHUKWU, Abuja

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igerians should brace up for an additional raise in the Value Added Tax (VAT) - presently at 5 percent, as the federal government which is now under pressure to raise additional revenues, reworks collection strategy.

Finance minister, Zainab Ahmed, signalled this possibility on Wednesday as she launched a new initiative, which seeks to push revenue generating agencies collect more and get particularly the high net-worth citizens pay higher taxes.

Ahmed indicated that the raise in VAT would likely be announced within the year- but would not be done across board.

“Government would adopt a selective approach,” she said.

She also mentioned that raising VAT would require an amendment of the Constitution and that talks are already progressing on how to send an amendment bill to the National Assembly to accommodate the new VAT policy.

“We are studying the possibility of a VAT increase but this requires an amendment of the law,” the minister stated while launching a Strategic Revenue Growth Initiative.

The new strategy is specifically aimed at mobilising domestic revenues and optimising government approach to revenue generation.

“The steering committee will look at the increase and it’s possible the increase will be on selected items and not

across board,” the minister explained.

“There will be a VAT increase and during the course of 2019 we will look at what the items will be and what the rates will be and when we have made up our mind we will send an amendment bill to NASS,” Ahmed said.

She also hinted that the government will also be introducing luxury taxes and excise duty on carbonated soft drinks “but we have yet to decide on the drinks,” she said, adding: “We still have much work to do before we decide on when it will come in force.”

Nigeria’s VAT revenue to GDP stands at 0.8 percent much less than ECOWAS average of 3.4 percent. Also, excise revenue, which is 4.1 percent, compares Ghana at 15.3 percent or Kenya at 19.5 percent.

Launching the strategy document, the finance minister regretted that Nigeria’s low revenue capabilities have been an enduring challenge to past and present governments. She said the current revenue to GDP ratio of about 7 percent is unsatisfactory and that government was working assiduously to turn this around.

“Although we are celebrated as the Africa’s largest economy, translating this wealth into revenues remains a challenge. We are therefore faced with the difficulty of mobilising domestic funds necessary for human capital development and infrastructure that are both drives of sustainable economic growth,” she said.

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Analysts tip GTB, Zenith, UBA to outperform peers ...suggest investors overpriced Nigeria’s country risk into equities TELIAT SULE

I

Another factor considered was the concentration of ag-

gas value chain, there is likelihood that GTB could witness 10 percent deterioration in its upstream loan book, implying that the year-end NPL could rise to 7.3 percent from the present 4.30 forecast for 2019e.

Zenith Bank Zenith Bank is also rated overweight as it is expected to hit N29 per share based on the current valuation. The report suggests a 47 percent return inclusive of 14 percent dividend yield. Zenith Bank trades on a 2019e price book ratio and return on equity of 22 percent.

Zenith Bank’s management is reputed for having strong attitude towards value creation which it has done overtime by lowering funding cost with a multi-period low cost of funds of 3.3 percent as at September 30, 2018.

“From the analysis above, a 120bp decline in cost of funds relative to our expectations could increase EPS by 13 percent and vice versa. Similarly, we find our valuation to be sensitive to cost of funds: on our estimates, a 100bp change in cost of funds could lead to a N5/share change in our valuation, based on our estimates”, the RMBN analysts said.

gregate loans. According to RMB Stockbroking analysts, the loan book of the Nigerian banking system was concentrated in two sectors, which are services, and, oil and gas. Based on their findings, 37 percent of the loans of the six banks were concentrated in the services sector, and to be followed by oil and gas at 23 percent. Combined, these sectors accounted for 60 percent of the Nigerian banking system’s loans.

Further, Stanbic IBTC, Zenith and GTB showed the highest resistance to capital erosion from deteriorating

asset quality based on the stress test conducted. In other words, the three banks could accommodate non performing loans rising over the level each bank recorded in the first half of 2018, without violating the regulatory 16 percent capital adequacy ratio (CAR).

What sets these banking stocks apart?

GTB The target price for GTB is N48 just as the stock presently trades at N32.10 per share. It is believed that GTB will exhibit a

ROE of 26 percent before year end while its valuation relative to peers is at premium. GTB’s earnings and loan book are attractive compared to Tier 1 peers. And based on the stress analysis, the bank’s return on equity has the potential to remain above its cost of equity just as the quality of its loan book relative to other Tier 1 banks stands at 82 percent as against 75 percent for others.

However, with 21 percent of its loan portfolio exposed to the Nigeria’s upstream sector, and 38 percent across oil and

UBA United Bank of Africa’s (UBA) target price is N11 per share and it presently trades at N7.25 per share. This projection is hinged on its diversification strategy and the growth momentum from its African subsidiaries. Based on the estimates, UBA’s African subsidiaries are projected to deliver 49 percent of its earnings in 2019 as against 46 percent in 2018.

The projected 2019 earnings forecasts are anchored on a solid 20 percent year on year growth from its African subsidiaries. Those in Nigeria are projected to grow earnings by 5 percent.

12734BDN

nvestors who are looking for direction in the Nigerian equity market in 2019, particularly for stocks listed in the banking sub-sector, will do themselves a great deal of good by reading the latest projections for the nation’s equity market in the RMB Nigeria Stockbrokers’ equity report.

Entitled “Nigerian Banks: A leap of faith. Take it”, the report identifies banking stocks both foreign and local investors could bet on for the remaining part of the year. The recommended stocks are supported with tested and proved technical and fundamental analyses.

It will be recalled that following the bearish run in 2018, where the equity market ended the year at -18.8 percent which amounted to over N2 trillion loss in market capitalisation, investors have remained cautious in their moves in the market year-to-date, due partly to the forthcoming general elections and the paucity of reliable equity research reports.

In their latest report, analysts at RMB Nigeria Stockbrokers rated Guaranty Trust Bank (GTB), Zenith Bank, and the United Bank for Africa (UBA) as overweight, implying that these stocks will outperform peers in the industry this year.

On the contrary, Access Bank, First Bank of Nigeria Holding Company and Stanbic IBTC Bank were rated as equal weight. Access Bank’s current rating is subject to review following the on-going merger with Diamond Bank.

“This is mostly on the expected binary outcome of key milestone events in 2019e, such as the resolution of Atlantic Energy and sale of the Ontario asset for FBNH and improved funding costs and possibly a relaxed effective CRR for Access Bank, which could support ap-

preciable re-rating. On average, our banking coverage is trading on a 2019e P/B of 0.8x on ROE of 19.5 percent, cheaper than their Middle East and African peers’ 1.3x on 14.5 percent ROE. On an absolute basis, we see an average potential total return of 42 percent for our coverage”, the analysts said.

“In a basic sense, if an analyst rates a stock as “overweight,” he or she thinks that the stock will perform well in the future. They believe the stock is worth buying and could outperform the broader market and other stocks in its sector. On the flipside, an “underweight” rating means the analyst thinks future performance will be poor. One can view “overweight” and “underweight” as being synonyms for “buy” and “sell,” The Balance, a financial intelligence source said.

The ratings assigned to the aforementioned stocks follow a cautious short-term outlook from a loan book growth which is expected to witness 5 percent year on year particularly in the first half of the year, with expectation that loan growth to pick up in the second half of 2019 and to hit about 11 percent year on year thereafter through 2020. In addition, these stocks are trading very cheap, with a 2019e price book ratio of 0.8x and return on equity of 19.5 percent.

These compare with 1.3x, 1.1x and 1.4x for Middle East and Africa, Kenyan and Egyptian banks respectively.

The six banks covered in the analysis, which are GTB, Zenith, UBA, Access, FBNH and Stanbic IBTC, have a combined N2.8 trillion market capitalisation, which translates to 25 percent of the market capitalisation of the Nigerian capital market in the second week of January 2019.

WIDE OPEN MINDED RMB Nigeria. Solutionist Thinking.

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We believe in stretching ourselves.

In broadening our horizons and embracing the unconventional to consider every possibility. Solutionist Thinking means deliberating together and collaborating with our clients to unlock exceptional prospects for the future. It’s the magic that inspires everything we do.

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Thursday 24 January 2019

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How political uncertainties affect foreign portfolio investment ADEMOLA ASUNLOYE

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ince 2014, foreign portfolio investors continued to exit the Nigerian economy albeit at a slower rate as it was manifested in 69.16 percent decrease in total foreign outflow from N846 billion in 2014 to N261 billion in 2016.

At the same time, there is a positive correlation between foreign outflow and inflow as the latter was down by 62.95 percent between 2014 and 2016 from N692 billion to N256 billion. Local investors likewise continued to pull out of the market as they reduced their investment from N1.1 trillion in 2014 to N517 billion in 2016. Consequently, total transactions at the nation’s bourse reduced by 43.51 percent from N2.67 trillion to N1.51 trillion within the same periods.

Amidst the volatility at the nation’s capital market, the continued decline recorded during the periods of 2014 to 2016 might be attributed to two major headwinds.

The first was the 2015 election uncertainties around the capital market which began to be priced in from late 2014. This led to the withdrawals of hot money as foreign outflow continue to outweigh inflow till 2016. The second headwind manifested in Q2 2016 when Nigeria staggered into recession.

This of course affected both foreign and domestic investors’ participation in the stock market.

In 2 0 1 7 , t h e t o t a l transactions at the nation’s bourse increased from N1.5tn in 2016 to N2.5tn. Local investors improved their play in the market as total domestic transactions contributed 49.13 percent to the total transaction. As the market

began to thrive, foreign investors hopped into the market which led to 133 percent increase in the total foreign transactions from N517 billion in 2016 to N1.2 trillion in 2017.

Foreign inflow increased

by 201 percent amounting to N772 billion by the end of 2017 year. The improvement in the market can be somewhat linked to the fact that Nigeria moved out of recession in Q2 2017.

Although foreign portfolio investment (FPI) continued to thrive into Q2 2018, another political panic started to affect domestic & foreign participations in equity trading from the end of Q2 2018.

A rapid decline in the total transaction started from June 2018 when the total transaction was down by 41 percent to N187 billion from N318 billion in May 2018.

The second and third quarters (Q2 &Q3) 2018 continued to witness very low participation in equity trading as investors feared how new and existing government policies and regulations might affect the market. This indication was extrapolated by interviews with key players in the industry as well as in the foreign portfolio investment report by the Nigerian Stock Exchange (NSE), which showed that foreign portfolio investors’ inflows accounted for only 23.97 percent of total transactions while outflows accounted for 26.73 per cent of the total transactions by the end of 2018.

In May 2018, total foreign outflow was at maximum amounting to N130 billion even as total foreign transaction also hits maximum at N192 billion contributing 60.62 percent to the total transaction of N318 billion. Domestic transaction which amounted to N228 billion was at maximum in January 2018 but had its greatest contribution of 75.24 percent to the total transaction in July 2018.

The least transaction was recorded in October 2018 where the total transaction in the equity market dropped substantially to N121 billion. On the contrary, compared to every other month in 2018, foreign transaction contributed greatest in October with 68.73 percent of the total transaction while domestic transaction trailed behind contributing 31.27 percent to the total transaction in October 2018.

Domestic investors

outperformed foreign investors by 4.54 percent in December 2018. Total domestic transactions increased slightly by 0.64 percent from N65.36 billion in November to N65.78 billion in December 2018. Also, total foreign transactions declined by 28.78 percent from N84.36 billion to N60.08 billion driven by a reduction in foreign inflows which reduced by 34.31 percent from N34.97 billion to N22.97 billion and foreign outflows which reduced by 24.86 percent from N49.39 billion to N37.11 billion over the same period.

By the end of 2018, institutional investors dominated the domestic investments with transactions worth N660 billion, representing about 55.74 percent of the total domestic transactions while retail investors were responsible for N524 billion worth of transaction which accounted 44.26 per cent of the domestic transactions.

Investors are sceptical about the equity market in 2019.The panic around the election constantly impels investors to withdraw funds as they await the outcome of the Nigerian 2019 elections because the direction of policies and regulations of the incoming administration could affect trades. There is consensus among analysts that stability will return to the market by the second quarter (Q2) after uncertainties surrounding the election might have subsided.

According to the Nigerian Stock Exchange (NSE), the equities market will be marked by volatilities in first half (H1) of 2019. NSE also speculated that swift approval and implementation of the 2019 budget may have a positive impact on companies’ earnings as well as consumer spendings.

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Thursday 24 January 2019

$100m loan for Nigeria’s broadband: Adebayo Shittu’s parting gift?

FRANK ELEANYA

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aturday, 19 January the minister of Information and Communication Technology (ICT), Adebayo Shittu received the High Commissioner of India to Nigeria, Shri Abhay Thakur who has pledged a $100 million credit line to help develop Nigeria’s broadband to boost connectivity in Nigeria’s rural areas.

As laudable as the gesture appears, one must ask whether it is truly a loan or an investment. If it is a loan, at what interest rate is it being given to Nigeria? However, a statement attributed to the High Commissioner does suggest it is likely not a direct loan.

“We have experience in the area of broadband network and reaching the masses of India,” says Abhay, “We have a whole range of IT programmes and projects particularly in the last five years and we think we can meaningfully assist Nigeria on the development of ICT and in the field of rural broadband network.”

Abhay’s statement could suggest that whatever uses

the money will be put to will be controlled by his country’s men. That is more in character with India financial gifts anywhere in Africa.

The problem however is the timing of the loan.

Depending on the outcome of the presidential election and whether the incumbent will want to retain his services after what has been described as a lack-lustre performance, Adebayo is likely to leave his ministerial position. What would the ICT industry re-

member him for? The man whose tenure saw the near collapse of MTN? Or under whose watch 9Mobile sale has become a long dream?

These days, when he is not dealing with controversies regarding his NYSC certificate, Shittu devotes a chunk of his time on his political ambitions more so with the election just weeks away. The little time he has left are used for the ministry he supersedes.

Nigeria’s weak broadband growth is not so much

OPPO vies for smartphone market top spot with $1.43billion spending chest FRANK ELEANYA

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uangdong-based Chinese consumer electronics and mobile manufacturer, Oppo says it plans to spend &1.43 billion (10 billion yuan) on Research and Development (R&D) to improve its technological capabilities. The company’s spending plan represents a 150 per cent year-on-year increase. It has also sets its sights on African markets like Nigeria.

In a statement sent to BusinessDay, the company disclosed that the R&D will focus mainly on the areas of artificial intelligence (AI), 5G technology and the internet of things.

To n y C h e n , C E O o f OPPO, noted that the company was committed to leverage AI to develop a wide range of smart devices including smart watches and smart home technologies to explore and meet the

increasingly rigid demands of consumers in the age of the internet of things (IoT).

“The vision is to dare to explore, dare to make breakthroughs and dare to innovate,” says OPPO team.

“In the future, OPPO will truly integrate technological innovation with art and humanity, to develop smart devices and smart homes with the smartphones at their core.”

R&D spending has recently been on the upward as most of the big manufacturers move to deepen their innovation. Spending in AI in particular has been leading other segments and in 2019, a Gartner report predicts it will grow further by 3.2 per cent as organisations shift from ownership to service.

5G is also another area predicted to grow. OPPO says it is positioning to become the first manufacturer in the world to launch 5G smartphones. The plan go as far back as 2015 when it

established a 5G team which have continued to work backstage till it achieved a major breakthrough in October 2018.

OPP O ’s range of 5G phones will fully integrate with applications and user insights, and continuously innovate to provide users with revolutionary, necessary convenient and seamless experiences.

With personalised experiences through technology as target, the company says it has applied AI technologies across a wide range of applications including photography, facial recognition and fingerprint identification while introducing many innovative features including an AI-powered beauty camera, 3D portrait lighting and intelligent recognition scenarios.

OPPO is envisioning a future where smartphones will become intelligent personal assistants and as such are already investing in R&D to make this happen first.

for lack of funding. Local investors some of whom are backed by foreign funding have continued to invest despite little incentives from the government. In that sense, Nigeria does not necessarily need a $100 million loan.

According to the Nigerian Communications Commission (NCC) overall broadband penetration in Nigeria hit 30.9 per cent as at November 2018, surpassing the 30 per cent target by the National Broadband Plan

created in 2014.

The growth was driven by the activities of seven infrastructure companies with licenses to deploy the needed infrastructure to facilitate the required penetration in the 774 local government areas in Nigeria.

While 30.9 per cent is a significant achievement it is nowhere near what a country like Nigeria requires to fully cover its entire population. Importantly, broadband is still very expensive.

A report released by Cable. co.uk in November 2018 showed that sub-Saharan countries including Nigeria have the most expensive broadband prices in the world. Average price in each of these countries hit more than $500 compared to the global average price of between $72.92 and $73.04.

Another report by the Alliance for Affordable Internet (A4A1) noted that the price of one gigabyte of data is as high as $35 in Africa compared to other continents.

Local broadband service providers face various challenges that cannot be wished away with a $100 million loan. Again it is not for want of investment. Five

submarine cables, Mainone, Glo 1, West African Cable System (WACS) and ntel’s SAT-3 land on Nigeria’s shores and have the capacity of generating 40 terabytes of broadband for the country.

Sadly, less than 10 per cent of that capacity is utilised as the rest lie fallow for reasons ranging from man-made damaging activities like fishing, shipping, to high cost of ‘Right of Way’.

Interestingly, the National Economic Council (NEC) RoW guideline stipulates N145 per metre for laying fibre network in every part of the country. However, states arbitrarily fix their own charges which range between N1, 500 and N6, 000.

Rather than a loan, Shittu’s parting gift for the industry that is yet to feel his performance should be in bringing together the states, federal and service providers on a table and insist they harmonize the Right of Way charges. He can also be remembered as the minister who enabled Nigerians maximise the capacity of the already submarine cables in Nigeria. All it may require is to pay a little more attention to the local operators.

HMD Global partners with Techpoint Build 2019 CALEB OJEWALE

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MD Global, the company currently manufacturing Nokia phones, has announced its partnership with Techpoint Build 2019, which holds on Saturday at the Landmark Event Centre in Lagos.

Techpoint Build is an annual tech conference that brings together over 30 thought leaders, 5,000 tech enthusiasts, startups, SMEs and innovators across West Africa. Organizers describe it as the biggest tech conference and exhibition that connects startups and

SME communities with all industries, driving conversations that shape thoughts and industry direction for all concerned stakeholders.

Olumide Balogun, head of Marketing, West Africa, HMD Global, said the partnership, is borne out of the organization’s firm belief in innovation, quality and continuous improvement.

“HMD Global has decided to show its unrivaled desire and commitment to advance the tech industry in Nigeria by throwing its weight behind Techpoint Build for the second year running,” he said. According to him, as a global startup

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

itself, HMD is aware that tech startups have a lot to contribute to the advancement of the tech industry, not just in Nigeria but all over the continent and even the world at large, hence, its commitment to come on board the event again.

The 2019 edition of Techpoint Build is expected to feature keynote addresses, SME/Startup clinic, pitch competition for startups, exhibitions and unveiling, as well as pragmatic panel sessions.

Adewale Yusuf, Convener of the event and CEO of Techpoint Africa, said the event is driven by its passion for startup and SMEs in Africa.

“Since inception, we have been encouraging conversations around technology and the startup ecosystem. The understanding that we need to take these conversations further, by bringing investors to fund technology-driven startups/SMEs in West Africa has let to Techpoint Build and we are glad to have a trusted partner like HMD Global to help with this vision,” he said.

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Thursday 24 January 2019

TechTalk

How Nigerian researcher creates African artworks using AI Stories by FRANK ELEANYA

O

ne of the major highlights in the world of Artificial Intelligence (AI) in 2018 was when it was used to generate realistic fake video footage by making the subject of one video mirror the motions and expressions of someone else in a different clip.

That piece of discovery raised a lot of eyebrows, proving the notion to some extent, that in the wrong hands, AI could be a powerful tool for spreading misinformation.

That theme also resonated at the recent UNESCO Forum on AI in Morocco where African countries gathered to chart a direction for the technology on the continent.

But, for Nigerian-born Victor Dibia, a human-computer interaction researcher and Carnegie Mellon graduate, the benefits for Africa outweighs the bad.

“I think of AI (broadly defined as the science of imbuing machines with human-like capabilities) in ways similar to any effective tool or technology,” says Dibia in an interview with BusinessDay, “Like many influential technologies in recent times – telephony, mobile telephony, the internet, etc., the degree of their impact is determined by the degree to which they are effectively deployed.”

His latest work on creating African artworks using AI provides the basis for his confidence.

With the help of Google’s TensorFlow machine learning framework, Dibia trained a generative adversarial network (GAN) to generate images based on custom dataset - the African masks dataset. GAN is a two-part neural network (a computer system modeled on the human brain and nervous system) consisting of generators that produce samples and discriminators that attempt to distinguish between the generated samples and real-world samples. GANs have incredible potential, because they can learn to create worlds spookily similar to the real one in any domain including images, music or speech.

Data scientists at Alphabet recently tasked a GAN with generat-

ing convincing photos of burgers, dogs and butterflies.

“In August 2010, I had the opportunity to attend the 2018 Deep Learning Indaba where Google generously provided access to TPUs (v2) to all participants,” he wrote in a post.

His current work (Generating African Masks using AI Masks) explores the intersection of African art and AI. It addresses the basic question of how can machines learn aspects of human creativity and become tools that support creative endeavours. The work also doubles as an approach to draw attention to the rather underrepresented but deeply rich area of Africa art.

“Early results suggest that an AI model is able to learn concepts around the design space for African masks (textures, geometry) and can generate new interpretations of what these artistic pieces could be. It contributes to the emerging area of computation art, or generative art by providing a computational lens to evaluate the styles of these art forms and enable conversations around them. In recent times, we have witnessed legitimate commercial interest in this area, with an AI – generated art piece sold at a reputable auction house such as Christie’s. It will be quite refreshing to see this level of engagement with African art.”

In October, 2018, a portrait produced by artificial intelligence “Edmond de Belamy, from La Famille de Belamy” sold for $432,500 including fees, over 40 times Christie’s initial estimate of $7,000-$10,000. The New York Times reports that the bidding lasted just under seven minutes, during which the buyer competed against an online bidder in France, two other phone bidders and one person in the room in New York.

When the hammer came down, the bids had reached $350,000, the fine price before fees.

GANs have been used in art since 2015 by artists such as Mario Klingemann, Anna Ridler, and Robbie Barrat.

Dibia says his work ensures that African art finds a voice in the growing research area of generative art and ensures it benefits from new conversations.

“The most impactful and popular form of artificial intelligence today follows a paradigm known as “supervised learning” where a machine is able to independently learn without any explicit programming, simply by looking through massive amounts of labeled data. For example, a machine is able to identify objects in an image (e.g. tables, chairs, cars etc) simply by looking through a dataset of images that have been labeled as containing each of these items. This process is known as training a model,” He says.

He acknowledges that the fear of job loss as a result of AI and automation is real. Africa has a high risk exposure with up to 85 per cent job loss predicted in parts of the continent. But with the right strategies and programs, Dibia says Africa which has one of the youngest populations in the world can weather the storm ahead.

However, government and private sector will need to collaborate to yield the most compelling results.

“Such a partnership will allow each entity leverage their respective strengths and achieve results that neither individually can,” says Dibia, “The private sector, unencumbered by bureaucracies, can provide leadership in research, innovation, and rapid execution of ideas. The government can provide long term policies, infrastructure and governance that support AI research. Some examples of these programs include work being done by Co-Creation Hub in Nigeria where they have partnered with government institutions on multiple health care and social good projects.”

It is important to note that opportunities also exist for AI to enable aspects of healthcare – examples include low cost disease diagnostics, reducing infant mortality, applications in telemedicine – agriculture (crop yield predictions, crop disease predictions), personalised education, citizen participation and transparent governance.

Digital transformation in AI, cloud to take centre stage at Nerds Unite 2019

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ver 20 speakers with expertise in the global technology industry are expected to provide insight and knowledge at the 2019 edition of Nerds Unite.

The event is expected to foster dialogue on technological breakthroughs in the areas of artificial intelligence (AI), cloud and cybersecurity and technology start-ups

as it relates to the development of the African continent.

In a statement sent to BusinessDay, MainOne the organisers of the event said over 500 of Africa’s most innovative technology minds from 200 companies and 10 countries are expected to attend the Nerds Unite on February 8, in Lagos.

“We expect senior representa-

tives from our global partners, infrastructure providers, enterprises and start-ups who will share insights into the disruptive technologies happening in Africa and the need to upskill quickly to meet the demand of digital transformation within the continent,” says Tayo Ashiru, Head of Marketing at MainOne. Under the theme ‘Accelerating

Digital Transformation’, the Nerds Unite 2019 will feature interactive sessions with global players discussing tools, infrastructure and partnerships required to benefit from a connected Africa.

With more than 3000 participants since inception, Nerds Unite provides a platform for major players in the international and local IT industry, key

stakeholders in Africa’s technology ecosystem, and IT professionals to network and brainstorm disruptive technologies.

The event creates an avenue for deal making, impactful knowledge sharing, and progressive collaboration between local industry experts and thought leaders from global technology companies.

40 BUSINESS DAY NEWS IMF 2% growth projection for Nigeria achievable - analysts www.businessday.ng

DAVID IBIDAPO

T

he recent 2 percent growth forecast by the International Monetary Fund (IMF) for Nigeria this year is achievable, despite the challenges posed by an election year, analysts say.

Nigerians go to the polls next month and in March to elect a new president, governors as well as national and state legislators, but the analysts believe that the predominance of political activities will not overshadow the economy.

The IMF trimmed down by 0.3 percent Nigeria’s economic growth projections for 2019 and 2020 to 2.0 and 2.2 percent respectively. According to report, this is on the basis that risks to global growth tilted to the downside.

“All we need is the right policies that will stimulate growth in various sectors of the economy,” Ayo Akinwunmi, economic and investment

analyst told BusinessDay. “If we tackle the Agric sector which accounts for about 29% of our GDP, with no crises in the food producing region in the country and an integration between manufacturing and Agric sectors, this should impact positively on GDP growth,” Akinwunmi added.

The presidential election that comes up first on Feb 16 is seen largely as a contest between incumbent Muhammadu Buhari, and his fellow northern Muslim, Abubakar Atiku, a former vice president.

Buhari has promised to continue his war on corruption while Atiku says he is coming to create jobs and get economy working again.

A change of Government or the continuation of the existing administration is expected to take effect in May, while fiscal policies implemented to drive economy growth is expected to take effect in the medium to long term.

“I do not think there

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will be a change of government and current activities by the existing administration should boost growth to IMF levels,” an analyst who pleaded anonymity, explained.

He further added that, “we have seen improvement in the non-oil sector and agricultural sector of the economy.”

Doubts over the realisation of IMF’s growth forecast were fuelled by the overbearing presence of political activities in the country, which have almost eclipsed the economy.

Recent activities in the economy as shown that the Federal Government of Nigeria (FGN) is currently largely focused on the election outcomes with less attention to growing the economy. This is capable of putting a downward pressure on GDP growth outcomes in Q1 2019.

Achieving an average GDP growth of 2.0 percent will mean that every quarter output should grow by at

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least 2 percent.

Growth in an economy is spurred by spending, however every indication points to a possibility of a delay in the implementation of the 2019 budget. From experience, it took president Buhari 6 months in 2015, to appoint ministers; even if he has learnt on the job about the importance of time, is there a certainty that he will not delay as much this time in choosing his cabinet?

Although the National Bureau of Statistics is yet to release the GDP growth rate for Q4 2018, BusinessDay analysts estimate a growth rate of 1.87 percent a marginal increase by 0.07 percent quarter on quarter (q/q) from 1.80 percent in Q3. This will amount to an average annual growth rate of 1.78 percent.

Among other factors, late implementation of the 2018 budget slowing down economic activities reflected in the slow growth experienced in 2018.

L-R: Kayode Ariyo, executive director, business development/COO, Global Accelerex Limited; Ifeoluwa Adebayo, special assistant to the Vice President on innovation and entrepreneurship; Stanley Jacob, chairman, CeBIH, and Kayode Olubiyi, vice chairman, CeBIH at the Annual Retreat of the Committee of e-Business Industry Heads (CeBIH) in Abeokuta, recently.

Domestic banking constraints intensify liquidity risks in Nigeria, other Africa, Middle East nations - Moody’s OLUFIKAYO OWOEYE

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redit Rating Agency, Moody’s says significant constraints on banks’ capacity and willingness to absorb potential increases in government financing needs in the event of a shock are intensifying government liquidity risks in some African countries.

These include Angola (B3 stable), Bahrain (B2 stable), Ghana (B3 stable), Kenya (B2 stable) and Lebanon (Caa1 stable) In a report, titled “Sovereigns: Africa and the Middle East, Domestic banking constraints intensify liquidity risks as global markets tighten”, assesses the Middle East and African gov-

ernments’ capacity to fund their borrowing needs from domestic banks looking at banks’ capacity and willingness to meet government borrowing needs.

The report also considers relevant changes in the regulatory environment that can influence banks’ capacity and willingness.

The report is focused on the countries where Moody’s rates both the sovereign and banks.

According to Moody’s it has identified pockets of vulnerabilities in Egypt, Nigeria and the Democratic Republic of the Congo, but expects governments to rely on domestic banks to cover their financing needs.

‘Some constraints are apparent either because

the banking system is very small or already largely invested in government securities, but these factors are mitigated by limited government financing needs or the system’s high deposit growth’ the report noted.

According to Moody’s, there is a scope for increased domestic bank financing of governments’ needs in Mauritius and South Africa.

‘Both countries have more developed financial sectors than the other countries covered by this report. Aside from substantial banking systems, nonbank financial institutions including insurance and pension funds provide stable and long-term funding to the government.’

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Thursday 24 January 2019

Obaseki urges journalists to Cross River IRS records over interrogate former leaders 200% increase in IGR in 7 seeking re-election to months account for their pasts MIKE ABANG, Calabar

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overnor Godwin Obasekiof Edo State has tasked media practitioners to interrogate former political leaders seeking reelection, to account for what they did with the power they were given in the past.

Such interrogation is necessary, especially as politicians intensify campaigns ahead of the general elections, Obaseki said.

The governor made the call during a courtesy visit by the newly elected executive members of the Edo State Council of Nigeria Union of Journalists (NUJ), at Government House in Benin City, on Wednesday.

Describing the mass media as agenda setters for the government and watchdog of the society, he noted, “We expect you to interrogate all our policies and actions and understand the rationale behind what we are doing, especially ahead of the general elections.”

He explained that his administration had created empowerment opportunities for Edo people and residents, and was restoring hope of a better life in the people, with the huge investment in infrastructure and human development.

According to Obaseki, “With about 63 percent of the state’s population below 32 years of age, my administration decided to prioritise youth empowerment so that they can be productive, through several initiatives that will equip them for the challenges of today and the future.”

He argued that political power should be used to improve the wellbeing of the people and maintained that in the era of technology with offerings such as social media, “people cannot be fooled because information travel faster than light.”

E

xecutive chairman of Cross River Internal Revenue Service (CIRS) Akpanke Ogar, says his agency recorded improvement in revenue generation in the last seven months from a paltry sum of N700 million to N3.5 billion, amounting to over 200 percent.

Ogar said this on Wednesday during a press briefing as part of sensitisation campaign for voluntary tax compliance in a bid to improve the state IGR. According to Ogar, the campaign is part of efforts by the service to reposition its service and redefine its relationship with taxpayers in the state.

He noted that the campaign was designed to improve the CRIRS’s base, increase the number of taxpayers in the informal and structured sectors of the state economy as well as improve the collection of taxes of the informal sector.

The IRS boss further disclosed that the campaign would also aim to acquaint taxpayers with various modern means of tax payment, including online platforms and other channels towards growing compliance levels among populace. ‘’We will deploy a robust social media platforms in reaching our tax payers and have a viable feedback mechanism to address grievances from tax payers,” he said.

“CRIRS’s target was to grow the tax base by increasing the compliance level from its current 8% to 30% within the period of the campaign.”

Minimum wage: Labour urges National Assembly to approve N30,000 JOSHUA BASSEY

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rganised labour under the aegis of Association of Senior Civil Servants of Nigeria (ASCSN) has urged the National Assembly to give legislative approval to N30,000 monthly minimum wage and not N27,000 approved by the National Council of State.

Recall that the council of state on Tuesday during its meeting in Aso Villa, recommended a downward review of the proposed new minimum wage from N30,000 submitted to President Muhammadu Buhari by the tripartite national minimum committee, to N27,000. Labour has since rejected this position,

arguing that the body made up of seating and past presidents, governors, among others, lacks jurisdiction to review wage already negotiated and agreed to by the tripartite committee.

Bobboi Kaigama, president, and Alade Lawal, secretary general of ASCSN, said on Wednesday that the lawmakers being the representatives of the people could not afford to shortchange workers ‘by siding with the executive arm of government.

They said: “As we write, Nigeria has become the poorest country in the world. Yet instead of approving a living wage for workers, the Presidency is hiding under the National Council of State to subvert N30,000 recommended by

the tripartite committee after extensive consultations and deliberations including touring of the six geo-political zones of the country before it arrived at that figure.

“Indeed, by recommending two parallel minimum wage, one for federal workers and the other for state governments and private sector employees, members of the National Council of State have given the impression before the international community that their knowledge of the global concept of a national minimum wage in a country is suspect.

“It is this type of decision that continues to make Nigeria a laughing stock before the comity of nations,” the union regretted.

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Metering, estimated billing still top list of electricity customers’ complaints STEPHEN ONYEKWELU

I

n the three months ending September 2018, electricity customers in Nigeria continued to complain about not having pre-paid meters, escalating estimated billing and service interruption.

Metering and billing featured most, accounting for 68,749, that is, 53 percent of the total customer complaints, the Nigerian Electricity Regulatory Commission (NERC) stated in its 2018 third quarter report.

“The Eko Electricity Distribution Company reviewed my monthly electric bill downwards in December to N7,600 from N23,000 for a three bedroom apartment, after many months of complaints,” Moses Akuyili, a trader who lives on No. 7 Okey

Ufoh Street, Kirikiri Town, said.

Since 2013, ineffective regulation has been the blight of the power sector. So far, NERC has been unable to enforce sanctions. Tariff is not cost reflective and DisCos abuse market rules.

In the second quarter (three months ending June 2018), metering and estimated billing were among the most significant concerns of consumers. Metering and estimated billing dominated customer complaints, accounting for 68 percent, that is, 103,636 of the total complaints.

Shortage of pre-paid meters and estimated billing is like Siamese twin that have constrained efficient service delivery in the sector.

The electricity distribution companies (Discos) have been fattening on estimated

billing and deterring them, which is the objective of Metering Asset Provider (MAP) regulation, is similar to attempting to dissuade a dairy farmer from milking his most productive cow.

The NERC in March 2018 issued a deadline of August 1, 2018, to the 11 Discos to engage the services of MAP, stressing that the move was aimed at achieving the threeyear target prescribed by the Commission. However, five months after the deadline less than 50 percent of Discos had fully complied.

“The MAP programme has not commenced but will,” Chantelle Abdul, managing director of Lagos-based Mojec International Limited, an indigenous prepaid meter manufacturer and MAP approved contractor, exclusively told BusinesDay.

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FG tasks tertiary institutions on innovative policy to revamp educational system IDRIS UMAR MOMOH, Benin

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he Federal Government of Nigeria has called on tertiary institutions in the country to think out of the box and come up with result-oriented innovations designed to revamp, re-engineer and reposition different segments of the nation’s educational system.

The minister of education, Adamu Adamu, made the call during the commissioning of Canvas Learning Management System (LMS) and the second public lecture of the Edo University, Iyamho, Etsako West Local Government Area.

Adamu, represented

by Ifeoma Isiugo-Abanihe, registrar/CEO, National Business and Technical Education Board, urged the

university authorities to be proactive and work out collaborations with critical stakeholders in the industrial, manufacturing and agricultural sectors to take advantage of the learning management system.

He noted that the commissioning of the facility would elevate the institution to the pedestal of a significant trailblazer in the use of productive digital education, within the West African sub-region.

He said the learning management system fitted into the broad objectives of the Federal Government ministerial strategic plan to offer a holistic approach that was interactive as well as comprehensive.

The minister also noted that as an innovative learning system with several advantages, the learning management system would not only

be beneficial to the university, rather it would facilitate interaction among teachers, students, parents/guardians and other stakeholders as well as has the capacity to close existing gaps between the town and gown.

“It is heart warming to note that the Edo University, Iyamho, is the first university in the West African subregion to acquire the CANVAS learning management system, which is globally acknowledged as the fastest growing learning management system, with more than 18 million users.

“Mr Vice Chancellor, you and your management have blazed the trail by this singular act of appropriating the use of an innovative technology in teaching and learning, which is the first of its kind in our clime.

Edo urges MDAs, residents to clear drains as government fast-tracks road construction

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Ifeanyi Okowa, governor, Delta State (m), his wife, Dame Edith (2nd r); Kingsley Otuaro, deputy governor (2nd l); Kingsley Esiso, state PDP chairman (l), and Senator James Manager, during Delta State PDP Warri-South West Governorship Campaign in Delta State.

Strategic investment of subsidy funds in infrastructure, social transfer will develop Nigeria - NESA BUNMI BAILEY

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evelopment of a country is a painstaking process that can only be achieved with strategic investment in critical infrastructure and social security, members of the National Economics Students Association (NESA) say.

While the students all agree that investment in fuel subsidy amounts to wastage and unbalanced distribution of wealth, they disagree on the avenues for reinvestment of the subsidy funds.

The Fuel Subsidy Debate themed Reinvesting Nigeria’s Fuel Subsidy: Pro-poor Growth Versus Social Protection Programmes was organised by The Peter Bauer Foundation (The Liberal Fo-

rum) at Freedom Park, Lagos Island.

NESA UNILAG, represented by Padonu Lois and Ibrahim Lasisi, maintained that the subsidy fund would find better use if it was invested in developing infrastructure across the country.

“Removal of subsidy would reduce Nigeria’s debts profile. Infrastructure, health and education are key indicators for development in a country, so investing in these sectors would only make for development in the country,” Padonu said.

Lasisi, who won the best speaker at the event, linked investment in infrastructure to poverty eradication and prevention of accidents on the country’s roads.

He said: “By diverting subsidy funds into road and

other infrastructure repairs, accidents would be reduced on the road.”

Linking his points to the mass exodus of health care workers in the country, Lasisi said, “Also, Nigerian doctors want to stay. If the subsidy fund is used to improve the health sector, the 1,500 doctors graduating annually will stay in the country.” He further asked, “Tell me just one country that has escaped poverty by prioritising social transfers over investment in infrastructure.”

Advancing their points, NESA UNILORIN, represented by Adefowope Iyabo Rahmat and Iortsor Ternenge Nicholas, held that social transfers to the poorest members of the population would stimulate the economy in a very positive direction.

do State governor, Godwin Obaseki, has directed relevant government Ministries, Departments and Agencies (MDAs) to ensure drains are cleared to avoid flash floods in parts of the state as work progresses on road construction across the state.

Obaseki made the call after receiving reports of blocked drains and heaps of debris awaiting evacuation in parts of Benin City, which hindered the free flow of rain water when the city recorded her first rainfall this year.

In a statement, special adviser to the Governor on Media and Communication Strategy, Crusoe Osagie, said the Ministries of Infra-

structure, Environment and Sustainability and the local councils would collaborate and coordinate the clearing of drains, especially in areas with a history of flash floods.

Osagie said the measures were proactive steps to check flash floods as the rains could impact on the physical environment, noting, “The state government is working towards ensuring that residents in the state do not suffer the effects of flooding, which destroyed some properties last year.”

He urged residents in the state to support the state government’s efforts to desilt drains and properly dispose of wastes, and called on residents “to avoid disposing of dirt in drains, as it could jeopardise the essence of

2019: We don’t discriminate in project execution - Okowa FRANCIS SADHERE, Warri

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elta State governor, Ifeanyi Okowa, says his administration does not discriminate in dishing out democratic dividends to Deltans because he sees the people as belonging to one united family.

Governor Okowa, who spoke at Otor-Udu, Udu Local Government Area of the state during the People’s Democratic Party (PDP) campaign rally ahead of the February 16 and March 2, 2019 general elections, said his administration had done all it promised the people in 2015.

The campaign team was also at Ogbe-Ijaw, Warri South Local Government Area of the state.

Okowa said, “We run an all inclusive government, we don’t discriminate, we don’t

execute projects based on the level of support we receive from people because, Deltans are one united people, we believe that if you don’t support us today, you will support us tomorrow.

“We are impressed with the crowd we are seeing here.

It is a clear evidence that the people appreciate the road we are constructing in the area, the schools we have constructed, and our empowerment programmes. We are committed to doing more.

“I want to seize this opportunity to thank Deltans, especially, the people of Udu for agreeing that we should work together.”

The governor appreciated the people for agreeing to live in peace with their neighbours, the people of OgbeIjaw, noting that with peace, the area will witness unprecedented development in the

next four years.

The governor, who attended the rallies with his wife, Edith and his deputy, Kingsley Otuaro, appealed to the people to vote for all the candidates of the PDP. At Ogbe-Ijaw, Okowa thanked the people for their support over the years, expressing confidence that with the number of registered voters in the area, they would beat their previous records in terms of number of votes cast for candidates of the PDP. “People are testifying about PDP because of our good work; I can testify that Warri South West is doing very well politically, your leaders are united; remain resolute in delivering high number of votes to the PDP by voting for all the candidates of the PDP. There should be no anti-party activity; all the votes should go to the PDP.”

42

BUSINESS DAY

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Live @ the Stock exchange

Thursday 24 January 2019

Prices for Securities Traded as of Wednesday 23 January 2019 Company

Market cap(nm)

PRICES FOR MAIN BOARD SECURITIES (Equities)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

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43

BUSINESS DAY

Live @ The Exchanges Top Gainers/Losers as at Wednesday 23 January 2019 GAINERS

Market Statistics as at Wednesday 23 January 2019

LOSERS

Company

Opening

Closing

Change

Opening

Closing

Change

GUARANTY

N32.1

N33

0.9

FO

N30

N29.5

-0.5

N47

N47.5

0.5

UACN

N8.9

N8.5

-0.4

N2.09

N2.29

0.2

NEM

N2.5

N2.39

-0.11

STANBIC FIDELITYBK

Company

ZENITHBANK

N21.8

N22

0.2

MAYBAKER

N2.45

N2.39

-0.06

STERLNBANK

N2.04

N2.14

0.1

DANGFLOUR

N6.6

N6.55

-0.05

ASI (Points)

30,878.56

DEALS (Numbers)

3,405.00

VOLUME (Numbers)

376,261,350.00

VALUE (N billion)

2.967

MARKET CAP (N Trn

11.514

Stocks gain over N50bn as bargain hunting strengthens on Nigerian Bourse Stories by Iheanyi Nwachukwu

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he cumulative worth of listed stocks on the Nigerian Stock Exchange (NSE) increased

by N52billion at the sound of the closing gong on Wednesday January 23 as bargain hunters raised stakes in more value counters currently trading at low prices.

Access Bank Plc, UBA Plc, FCMB Group Plc, Zenith Bank Plc, and Fidelity Bank Plc were actively traded stocks on the Bourse. In 3,405 deals, stock dealers exchanged 376,261,350 units valued

at N2.967billion.

The All Share Index (ASI) closed at 30,878.56 points against

the preceding day low of 30,736.88points, representing 0.46percent increase. At the close trad-

Vitafoam sees new products boosting earnings

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etermined to expand its revenue base, enhance customers’ healthy living and boost shareholder value, a foremost manufacturer of rigid foams and allied products, Vitafoam Nigeria Plc has added eight new products into its portfolio kit.

Beside, the conglomerate which announced an impressive third quarter result recently has signaled another uptick of earnings in its first quarter performance expected to be unveiled soon.

The products which were formally presented to the general public Monday were Vita Pearl, a pillow that regulates temperature and draws moisture from body, assorted Customised Beds, Sofas, Trifold Mat for Leisure, Reading Chairs, three Specialized Mattresses including orthopedic and classic and various Polyurethane Sandwich Panel Steels.

Speaking at the launch ceremony in Lagos, the company’s Group Managing Director and Chief Executive Officer, Taiwo Adeniyi explained that the new

products were borne out of the company’s culture of innovativeness. Adeniyi noted that product differentiation had become one of the hallmarks of Vitafoam Group which makes it difficult for anyone to clone the company’s unique products.

“For us in Vitafoam, we are very concerned about innovation. Our ability to research, develop and then end up in innovating different products that meets the customer’s needs gives us great satisfaction. In the history of Vitafoam, this launch is one event long overdue because we have sneaked into the market a number of products which were not particularly launched this way. We delight ourselves to be able to make history once again.

This is another step in the right direction to sustain our corporate culture of

shareholder Value. “Basically, the launch is just adding to the array of success stories of Vitafoam.

The Nigerian market is waiting for our products. As soon as we have introduced a Product into the market, we are also working on some other ones. It is difficult to fake our products because as for us product differentiation is our strategy”, said Adeniyi.

Corroborating Him, the Operator of Vitafoam’s Comfort Center, Ilupeju, Toye Adegboye explained that the new initiative products would enhance diversification of Vitafoam’s products. According to him, the company’s products appeal to diverse spectrum of customers.

“Some of the products are pocket -friendly and without compromising standard. As a good corporate citizen, all the company’s products are of high quality and the target of Vitafoam as a group is to produce affordable high quality products which are making business to thrive for us as their partners”, said Adegboye.

ing, 21 stocks gained as against 10 losers.

The value of listed equities –the market

capitalisation increased to N11.514trillion as against N11.462 trillion recorded the preceding trading day, representing N52billion increase.

Year-to-Date (YtD) returns currently stands at -1.76percent.

GTBank Plc recorded the highest price gain after its shares advanced from N32.1 to N33, adding 90kobo or 2.80percent.

Also, Stanbic IBTC Holdings Plc gained 50kobo or 1.06percent, from N47 to N47.5.

Fidelity Bank Plc advanced by 20kobo or 9.57percent, from N2.09 to N2.29. Zenith Bank Plc also recorded 20kobo gain or 0.92percent, from N21.8 to N22; while FBN Hold-

ings Plc gained 10kobo or 1.37percent, from N7.3 to N7.4.

Forte Oil Plc occupied the topmost position on the losers table after its share price declined from N30 to N29.5, losing 50kobo or 1.67percent. Also, UAC of Nigeria Plc share price decreased from N8.9 to N8.5, representing 4kobo or 4.49percent.

NEM Insurance Plc dipped from N2.5 to N2.39, losing 11kobo or 4.40percent. May & Baker Plc declined from N2.45 to N2.39, down by 6kobo or 2.45percent; while Lafarge Africa Plc declined from N12.6 to N12.55, losing 5kobo or 0.40percent.

Foreign investors pulled N642.65bn from Nigeria’s stock market in 2018 … oil prices, election risk to drive sentiment in H1

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oreign investors sold off Nigerian stocks valued at N642.65billion ($2.1 billion) last year, stock exchange data showed, 48percent more than in 2017 as worries over weak growth amidst lower oil prices depressed sentiment.

Risk aversion triggered by interest rate rises in the United States reversed capital flows to frontier markets including Nigeria, coupled with mounting political risk in the run-up to elections next month, accelerated losses for the stock market.

The exchange put the value of transactions by foreign investors at 1.219 trillion naira last year, compared with 1.208 trillion naira at the end of 2017.

Oscar Onyema, CEO, Nigerian Stock Exchange said market sentiment in the first half (H1) of 2019 would be driven by oil prices and

election risk. But government spending to boost recovery following a 2016 recession could lift stocks by the second half.

The main index, which was flat on Tuesday, has fallen 2 percent so far this year. It shed 17.81 percent in 2018 after a strong rally the previous year.

Foreign investors increased the pace of stock market outflows from May, selling out of the relatively liquid banking, consumer and oil sectors as the capital flight worsened, putting

pressure on the local naira currency.

OPEC member Nigeria suffered severe dollar shortages after prices of crude, its top export and main source of foreign exchange, plunged in late 2014, prompting the introduction of capital controls in 2015.

It now has multiple exchange rates against the U.S. currency and has been selling the dollar on the interbank market to boost liquidity after floating the naira for investors.

44

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Leadership

BUSINESS DAY

45

Shaping people into a team

Life’s Work: Michael Ovitz — Part 1

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he Hollywood Superagent Turned Silicon Valley Adviser On Winning Over Clients And Building Creative Teams.

As a co-founder of Creative Artists Agency, Michael Ovitz revolutionized how big deals in film, TV, music and corporate media were done from the 1970s through the 1990s. Following brief stints at Disney and his own mobile content startup, he reset his career as an adviser in Silicon Valley.

In your memoir, “Who Is Michael Ovitz?,” you say that agents are first and foremost sellers — of themselves and their clients. What makes a good salesman?

Sales can be done aggressively — a constant barrage — or with thought, more elegantly. We tried to sell based on the quality of the client and to make the presentation softly. But we were aggressive in that we would never stop. We wouldn’t take no for an answer.

Selling was easier for us than for others because we would only sign talent we really believed in for the long term.

But when you were just starting out, how did you sell yourselves to those quality clients?

It was an uphill fight. We were young, so we had to differentiate.

We could not perform like traditional agents — fielding calls and trying to sell clients on jobs. Our thesis from day one was that we would take clients’ dreams and put the projects together.

The strategies you used to turn CAA into a powerhouse sparked resentment. People have called you a bully, a villain and worse. If you could do it again, what would you do differently?

At the time I thought being vulnerable was a sign of weakness and that any weak link would affect the

well?

business. We were the ones who got stuff done, and that meant we sometimes ran a little rough over people. We always had to be moving forward and winning. We had to have 100% market share, the No. 1 book, the No. 1 movie, the No. 1 TV show. I discovered after the fact that we could have gotten just as big and still let a few others take some wins.

But the tactics worked.

Really well. I remember when we sold “ER” to a very unwilling NBC. They didn’t like the pilot, so we manipulated everything we could to get it to work. We got Warner Bros. to push hard. We got Steven Spielberg and Michael Crichton to make calls. We pushed from every angle. We believed in the show. But we ran over a lot of people at NBC to do it. And there was a cost associated with it, which I personally paid and would have preferred not to.

In your book, you call out betrayals by former colleagues and friends: Jim Moloney, Michael Eisner and Ron Meyer. Why rehash those stories now? Are you trying to learn from the experience?

Help others to do so?

I’m telling a story about lessons learned: things done right and things done terribly wrong. Each of those relationships went wrong for a different reason. One stayed wrong. One ended because the individual passed away. And one came back to life, which is pleasing. I’m at a place in my life where

I can look back. As an investor and a consultant in Silicon Valley, I’m meeting the most brilliant young people and trying to give them advice, and the lessons they like are about the mistakes I’ve made as much as the successes.

what ours were getting, and we said, “You’re under-asking. You should get five times our clients’ fees added together.” The agent understood, and when we were done laughing, we got down to making a serious deal.

You’ve been involved in so many high-stakes negotiations. What’s the key to a successful outcome?

But strong-arming was a tactic you used, too.

You need to know where you want to end up before you engage. At CAA we spent hours on prep work for the larger negotiations. We did studies, readouts, role-playing — everything we could. But even in the smallest negotiation, we always wanted to know how the meeting would end before we walked in the door. How do you manipulate the scene to get what you want for your client but leave something on the table for the other side so that when they walk away, they feel happy?

But if your counterparts have their own ideal outcome and it’s different from yours, how do you reach an agreement?

That’s the fun part of negotiating.

We had different ways of handling that. Sometimes when we were on the buy side, putting together a TV show package, someone would come in and quote us a fee for an actor that was not in line with the budget, and we’d say, “There’s nothing to respond to. We’re going to recast.” One time an agent asked for a client fee that was double

When we had leverage, we used it. Take “Jurassic Park.” That package was developed at CAA. Michael Crichton pitched me the story. I gave the book to Steven Spielberg. He said he was in. So was Kathleen Kennedy, a producer. We controlled all the elements. So we had the ability to go to the first studio and say, “We have good news and bad news. The good news is that we have a movie based on a book

by Michael Crichton that will be a best-seller. It will be directed by the great Steven Spielberg and produced by the great Kathy Kennedy. You need no stars. We have three young cast members.

The bad news is that we and the clients control it.” We asked for a partnership deal in which clients and studios were paid the same, dollar for dollar, and said they had one day to come back to us.

It was said nicely, but it was as strong-arm as you could be. If they said no, we already had it backed up and sold at another company.

How did you know whether people would collaborate

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

In the Valley now, I deal with men and women who believe they’re unstoppable. In the entertainment business, people were just as spirited. But you could tell if they’d be collaborative by how they accepted suggestions. Look at Mark Zuckerberg. He’s not afraid to have brilliant people working for him who tell him what they think. When we put “Ghostbusters” together, Dan Aykroyd wrote it, but Bill Murray put his imprimatur on it, and [the director and producer] Ivan Reitman and [the late actor] Harold Ramis — may he rest in peace — added theirs. Understanding the creative process, doing our homework on the participants in a package — that gave us a sense of whether they could relate.

When projects took forever to get going, how did you have the patience and focus to keep at it?

It was strictly belief. “Rain Man” went through four directors in three years before we shot a foot of film, but the motor for that project was Dustin Hoffman. When a client wanted to achieve something, it made my job much easier. All these brilliant directors — Marty Brest, Steven Spielberg, Sydney Pollack — were trying to find a third act: positive change at the end of the movie. Finally Barry Levinson said, “There is no third act.” After talking it out, Dustin Hoffman agreed with him. It was an interesting creative moment. There were hours of discussion. Should Dustin as Raymond show some improvement? But with his type of autism, it had to stay the same.

So we agreed to take that risk.

The newspapers and daily trades predicted that the film would fail, the head of the studio would be fired, the clients would be angry, I would be fired. But lo and behold, it went out the first weekend at $6 million and did the same for the next 50 weekends and won four Academy Awards.

46

BUSINESS DAY

NATIONAL DISCOURSE

LOLADE AKINMURELE

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igeria plans to spend some $30 billion this year as Abuja enters a fourth straight year of expansionary spending that began in 2016.

To breathe life into an economy that was receding almost as fast as the hairline of a young Wayne Rooney (British footballer who played for Manchester United), Abuja aimed to loosen the public purse strings to spend its way out of the recession.

It is a strategy that draws comparison with the Keynesian economic theory developed by British economist John Keynes during the Great Depression in the 1930s.

The thinking is that a substantial injection of government spending can jump-start a weak economy.

The theory assumes that the money spent by the government will goose growth and create a ripple effect as producers hire people to deal with the increase BALA AUGIE

T

he importance of manufacturing sector cannot be overemphasised because it fuels economic growth, especially for emerging and developed markets economic. No economies will grow without robust manufacturing. The sector is also the largest employer of labour after the agric sector.

While manufacturing PMI in the month of September stood at 56.2 index points, from 57.1 in August, indicating expansion in the manufacturing sector for the eighteenth consecutive month, low consumer purchasing power, epileptic power supply, bad roads, high interest rate environment, influx of cheap and substandard product, and Apapa gridlock, have hindered firms from growing top lines sales and bottom line (profit).

It is generally accepted that companies make money in the form of increased sales when consumers open their bourse strings, but this isn’t so because the economy is growing sluggishly while Nigerians are getting poorer as unemployment rates spike amid growing population.

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Thursday 24 January 2019

The curious case of a government too broke to matter in “aggregate demand,” thus triggering an economic recovery.

And so, the Nigerian government would unveil three record budgets that were coloured by increased spending in infrastructure to stimulate commerce and save its ailing economy in Keynesian style.

In came the N6.06 trillion 2016 budget, the N7.4 trillion 2017 budget and the N8.6 trillion 2018 budget. Each budget earmarked some 30 percent to capital expenditure.

With the benefit of hind sight, however, three years of the socalled “expansionary” budgets haven’t worked for Nigeria.

Economic growth is yet to eclipse the 2.5 percent recorded pre-recession and expansionary budgeting in 2015.

Instead, when the economy has not contracted, it has remained sticky below 2 percent at best, and average incomes have contracted every year since then.

Job creation has also disappointed. Unemployment rate climbed to a six-year high of 23 percent as at the end of Q3 2018, according to NBS data.

It is no surprise that those budgets have fallen short of expectations to stimulate economic growth and create jobs.

Here’s why.

As if the small size of the budgets relative to an economy the size of Malaysia ($314.5 billion) and Ghana ($47.3 billion) put together was not enough, the Nigerian government actually spent less than budgeted, as a disappointing revenue outturn led to a cut back in capital

spending.

In 2016, only N4.3 trillion was spent, 28 percent below the planned N6.06 trillion. Even much less was actually spent on capital projects, so much so that it was the lowest in a decade.

That meant the most critical spending item for a developing nation only got trickles of the requirement, as a paltry N173 billion was spent on capital projects. That worked out to 11 percent of the N1.59 trillion that was budgeted.

How then can it come as a surprise that the budget had no impact on the economy which would go on to contract every quarter in 2016, leading to a fullyear decline of 1.5 percent.

Nothing could be further away from Keynesian economics than the fact that the N4.3 trillion spent that year was even less than the N4.8 trillion spent in 2015, a year when the budget was not designed to be “expansionary.”

Even if the budget was fully implemented, it would have still been like a drop of water in an ocean. After all, N6 trillion is less than 7 percent of the country’s GDP. The 2017 and 2018 budgets have followed a similar path to the 2016 budget, with government spending lower than planned, despite an increase in capital spending compared to 2016’s record-low.

In 2017 and 2018, a combined N3.4 trillion was spent on capital projects.

In each of the two years, capital expenditure was less than 1.5 percent of GDP and the

economy did not hold back in showing signs of one starved of infrastructure spending.

Though the economy exited recession in the second quarter of 2017, the expansion did not come from government spending, rather, the largest contribution came from net exports, which was fuelled by an uptick in oil exports.

Ironically, government consumption expenditure contracted 19.46 percent that quarter.

Surely, there’s nothing Keynesian in contracting government expenditure.

At the heart of Nigeria’s failed attempt in using public spending to stimulate economic activity, has been underperforming revenues.

The economy is still experiencing a hangover following 2016’s recession, tax revenues have grown but remain less than 8 percent of GDP while oil revenue is as volatile as ever and cannot be relied on.

With these, it appears Nigeria is short of the kind of revenues needed to be Keynesian, never mind the theory in itself has a long track record of failure.

So here we are with the wrong idea of Keynesian economics.

A possible alternative will be for the government to attract private capital on a large scale.

No matter how much the current administration says it is working with the private sector to attract investment capital, the numbers simply do not support it.

Despite budgeting nearly a billion dollars in privatisation proceeds between 2016 and 2018, the Federal government

The pains of manufacturers According to a recent World Bank data, 92.10 percent of Nigerians live at below $5.50 a day. The reality is that most people cannot afford to buy a packet of Spaghetti or proteins.

Nigeria with a population of 180 million people has 87 million people, nearly half its population, in extreme poverty, as high inflation environment continues to erode discretionary income.

More worrisome is that the country’s population is expected to hit 400 million by 2050, making it the third most populous nation in the world.

Nigeria’s economy remains fragile as GDP grew by 1.50 percent in the second quarter of 2018, a downturn from 1.95 percent in the first quarter.

Inflation figure increased to 11.44 percent in December 2018 from 11.28 percent in November, the highest increase in seven months.

Even the inflation figure is lower than the central bank’s 6 percent and 9 percent range.

MANUFACTURING The Nigerian Industrial Revolution Plan, published in 2014, identifies weak purchasing power as an obstacle to industrialisation in Nigeria.

The insurgency in some parts of the country- which has claimed millions of lives and displaced farmershas hindered companies, especially operators in the food and beverage from shipping their products to these crisis region hence resulting in loss of significant market share.

Apapa gridlock is also another key issue. Honeywell, a major player in the industry, attributed the key impediment to growth to the Apapa traffic gridlock, which has virtually crippled business activities in Lagos State.

Its management said the dilapidated road infrastructure and chaotic traffic situation in and around the nation’s premier port made it inordinately difficult, and enormously expensive to transport goods out of the factory in Tincan Island, adding

that the challenge resulted in an effective freight cost increase of about 25 per cent last year.

The management of Dangote Group says its sugar and salt companies lose about N2 billion monthly to the perennial traffic gridlocks on Apapa port roads every month.

Former president of the Manufacturers Association of Nigeria (MAN), Frank Jacobs, said that these challenges are still manifesting in the form of high inventory of unsold finished products, inadequate electricity supply, frequent increases in electricity tariff in the face of poor services from distribution companies and abnormally high interest rates.

The cumulative average stock (inventory) turnover ratio of the largest consumer goods firms fell to 2.83 times or 234.05 days between 2018 and 2017 from 3.70 times or 144.52 days recorded in the period of between 2017 and 2016.

Politicians are busy politicking and turning a blind eye to the plight of manufactures oblivious that if the sector collapses, the economy will

has only raised N5 billion ($16 million), 14 times less than it made from selling only one company in 2006, following the $225 million sale of Port-Harcourt based olefins and polyolefin maker, Eleme Petrochemical to Indorama Group.

The country’s privatisation agency had said it would raise N289 billion ($797 million) by selling 10 state-owned assets to bridge an appalling revenue shortfall and meet up with key projects in its budget.

While largely shunning equity capital, the government has shown a preference for debt, with the total debt stock for the federal government alone rising to N19 trillion as at the end of September 2018 from N10.9 trillion as at the end of December 2015.

Though provision was made for N10 billion (USD$ 32 million) in privatisation proceeds in the 2017 budget, not a kobo was raised and the amount rolled over to 2018, an indication that the government does not really look at privatisation as a good option not only to boost economic growth but even to grow revenues.

The government’s attitude towards privatisation needs to change if Nigeria must grow at a rate above population growth.

The government simply does not have the financial muscle to drive economic growth and cannot borrow in the next four years as it has done in the last four.

The job of stimulating the economy is better left to the private sector as is the case in developed and developing markets. shudder. It will be disheartening and disappointing to see a repeat of the 2016 recession when a severe dollar scarcity crippled business activates.

While the introduction of a foreign exchange policy in 2017 and the rebound in crude oil production that helped the country exist recession in the third and fourth quarter of 2017, whoever is elected president is saddled with the responsibility of formulating policies, removing infrastructure bottle neck, to help propel the manufacturing industry to growth.

According to the National Bureau of Statistics (NBS), nominal GDP growth of manufacturing in the third quarter of 2017 was 10.32 percent (year-on-year), 13.25 percent points higher than growth recorded in the corresponding period of 2016 (-2.93 percent), but -5.65 percent points lower than the preceding quarter growth of 15.97 percent. Quarter on quarter growth of the sector was 3.21 percent.

The contribution of manufacturing to nominal GDP in the current quarter was 8.55 percent , lower than figures recorded in the corresponding period of 2016 at 8.60 percent and for second quarter of 2017 at 9.02 percent, NBS report added.

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Elect me, and we will regain our status as Africa’s top recipient of FDI - Atiku

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tiku Abubakar, presidential candidate of the People’s Democratic Party (PDP), has bemoaned the worsening economic woes of Nigeria in relation to the fall in the foreign direct investments (FDI) into the country, pledging that if voted into office, “we will regain our status as Africa’s top recipient of FDI”.

In a statement signed by Atiku, a copy of which was made available to BusinessDay, he said: “It is with a very heavy heart that I received the news that the Republic of Ghana has overtaken our dear nation as West Africa’s largest recipient of foreign direct investment (FDI).

“For all the years that the People’s Democratic Party governed Nigeria, including the eight years of which I was Vice President, Nigeria always set the pace for Africa in terms of foreign direct investment and became the number one recipient of FDI in Africa in 2013 under a PDP administration. In that year, we also became Africa’s largest economy, thanks to the PDP’s leadership.”

The presidential candidate fur-

ther said: “As a businessman and employer of labour, I am disappointed that Ghana, a nation with 15percent of our population has outperformed us in this area. This is an economic emergency that

must be addressed.

“Sadly, this unfortunate economic indicator has escaped the attention of the current administration, that is more interested in hounding real and imagined

The remain body of former Chief of Defence Staff (CDS) Air Chief Marshal Alex Sabundu Badeh laid to rest at the National Military Cemetery in Abuja. picture by TUNDE ADENIYI.

Buhari, Oshiomhole, Tinubu, others storm Abakaliki for Ebonyi campaign flag-off ...As APC set to take over Government House

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resident Muhammadu Buhari will lead other stalwarts of Nigeria’s ruling political party, the All Progressives Congress (APC) in an epoch-making flag-off of the party’s campaign in Abakaliki, the Ebonyi State Capital on Wednesday, January 30, 2019. The flag-off is scheduled to hold at the Pa Ngele Oruta Twonship Stadium Abakaliki.

The governorship candidate of the APC in Ebonyi State, Senator Sonni Ogbuoji, said that the flag-off will be an opportunity for Ebonyi people to know his plans for the liberation of the state from the stranglehold of the purveyors of poverty and underdevelopment of the state.

“I am on a liberation mission in Ebonyi State. I have always believed that public officers should work to enthrone a government works with the people to enthrone a collective sense of common purpose and direction for the benefit of all stakeholders,” Ogbuoji said.

“This belief has not changed; instead it has been strengthened over the years, necessitating my

opponents, like the Chief Justice of Nigeria and many legislators, than in addressing the rapid economic decline Nigeria is witnessing under their watch.”

“I foresaw this happening,

desire to serve the good people of Ebonyi State.”

Other bigwigs of the party who are expected to grace the occasion include Adams Oshiomhole, national chairman of APC, Vice President Yemi Osinbajo, Senator Bola Ahmed Tinubu, the national leader of the APC, Governor Rochas Okorocha of Imo State, Governor Nasir El-Rufai of Kaduna State, Governor Kayode Fayemi of Ekiti State, Governor Abiola Ajimobi of Oyo State, Henry Ajomole, former chairman of All Chairmen of APC, and the members of the National Working Committee of the APC. “For these people to come to Ebonyi State to support our campaign despite their already tight schedules, shows how significant the event is for the party,” said Senator Ogbuoji in a telephone interview. “Ebonyi people should rest assured that the governance of prosperity and progress which APC is bringing to the state will reach everybody.

“We will ensure that our youths are sufficiently empowered and taken off the streets of Nigerian cities – the era of Ebonyi street

hawkers will be a thing of the past when APC takes over government in Ebonyi State come May 2019,” Ogbuoji emphasised.

Analysts who are familiar with political events in the State said that the flag-off accentuate the popularity of the party in the State and lay to rest any semblance of doubt regarding the capacity of the party to garner landslide victory in the February and March elections in the state.

Speaking about the flag-off ceremony, Prince Nweze Onu, the APC Candidate for Ebonyi South Senatorial Zone, said that Ogbuoji has used his position as a senator to attract many projects to the people of the State.

“Senator Ogbuoji went beyond his primary constituency to impact the lives of people from other parts of the State,” Prince Onu told journalists in Abakaliki, the Ebonyi State Capital on Thursday, January 24 2018. “His impacts have been felt in all aspects of life of Ebonyi people – from health infrastructure to education, electricity, portable water, good road networks and a myriad of empowerment projects.”

which is why I was in the United States last week to get foreign investors who have been divesting from Nigeria, to return their investments. Prior to my US trip, I had undertaken similar missions in Europe and the Orient.

“It is of particular importance to understand why Nigeria has become an economic pariah under the present administration leading to us becoming the world headquarters for extreme poverty. When you have a leader who habitually travels abroad to de-market his own nation and its economy, things like this are bound to happen,” he further said.

Atiku noted that “Economic challenges will bow only to proper agenda. Propaganda has no effect on them and will only make a bad situation worse, as we see today.

“Therefore, I solemnly declare to Nigerians, that if I am elected President on February 16, 2019, I will be Nigeria’s Chief Marketing Officer, and will never speak ill of our economy, our polity and our youths. My utterances, both at home and abroad, will be used to lift Nigeria’s economy because Atiku means JOBS.”

Adelabu promises to establish consultative forum to interface between government and students Akinremi Feyisipo, Ibadan

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he Oyo State governorship candidate of the All Progressives Congress (APC), Adebayo Adelabu has promised to establish students’ consultative forum which will serve as an interface between his government and students in the state when elected.

Adelabu, a former deputy governor of Central Bank of Nigeria (CBN), made the promise at a parley with the leadership of Oyo State students in tertiary institutions in Ibadan, the state capital.

The APC gubernatorial candidate in a statement in Ibadan by Bayo Busari, spokesperson for Friends of Bayo Adelabu Independent Campaign Group, (FOBA ICG), said that the students were led by NANS JCC Chairman in Oyo State, Moronkola Teslim and Federation of Oyo State Students (FOSSU) Senate President, Wasiu Oke. The students used the medium to throw their support behind the candidature of Adelabu.

The students’ leaders while assuring Adelabu of their votes, declared their utmost confidence in his ability to lead the state to a greater height.

Busari further said that Adelabu also met with Professional Videographers Association of Nigeria (PVAN).

He noted that members of PVAN during the meeting adopted Adelabu as their gubernatorial candidate.

Busari noted that the adoption took place during a meeting between members of PVAN and Friends of Adebayo Adelabu Independent Campaign Group.

PVAN Governor, Niyi Olanrewaju said that the association was ready to mobilise its more than 22,000 members to work tirelessly for the success of Adelabu at the polls.

Olanrewaju noted with delight the effort of Adelabu to bring about the peaceful atmosphere that pervades the length and breadth of Oyo State through his leadership of the Oyo State Security Trust Fund.

He said: “The people of Oyo State have enjoyed relative peace through the effort of the security trust fund that you head. Not only this, your uncommon contribution to the establishment of the Technical University has not gone unnoticed.”

“It is our belief that if you could do all this, aside your various philanthropic activities, you best suited to be the number one man in Oyo State, come May 29, 2019,” Olanrewaju declared.

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Inoyo Toro Foundation rewards Akwa Ibom teachers with cash

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s more and more young people thumb their noses at the teaching profession, preferring instead to do buying and selling ‘if worse comes to the worst’, Inoyo Toro Foundation has found it needful to appreciate teachers in Akwa Ibom State and make them the envy of other professionals every year end.

Public secondary school teachers who are adjudged the best in their best teachers in English, Mathematics and the Sciences go home with prize moneys of between N100,000 and N150,000.

The immediate impact of the awards is that public school teachers are fired up to deliver their best and to be noticed for call up for the tests. Healthy competition is engendered as teachers seek to update their knowledge and to excel as teachers, the ultimate beneficiaries being their students.

The Foundation by this gesture is supplementing the efforts of the Akwa Ibom State government to ensure capacity building in the education sector.

According to Dr. Enobong Joshua, Chairman of the Awards Committee, 109 teachers sat for the test. They consisted of 24 English teachers 22 Mathematics teachers 15 Biology teachers 22 Chemistry teachers 19 Physics teachers 6 Economics teachers, and 1 Visual Arts teacher The first prize winner in each subject received N250,000, the second N150,000 while those adjudged third, got N100,000.

Dr. Joshua bemoaned the lack of optimal performance by public school teachers. We believe, like many others that the reason for this can be traced to lack of incentives from the state government, as indeed teachers suffer from governments at different levels all over the federation. Another reason of course is the lack of oversight by staff of the edication ministries who leave uninspired teachers to carry on without appropriate sanctions.

All of that is for government to address. However, individuals and organisations like the Inoyo Foundation are doing the needful to keep public school teachers revved up to deliver on the business of training today’s kids for the challenges of today and tomorrow.

Winifred Oyo Ita, Head of the Service of the Federation, was a

special guest and she had a lot to say about the halcyon years when teaching was the most sought after profession. She related how her mother, the late Mrs. Angelica Ekpeyong Nyong taught for many years, beginning in 1969 at Ireti Primary School, Ikoyi, Lagos. That was back when, according to her, teachers were highly respected members of society who were collectively considered the custodians of wisdom and knowledge in their communities.

Mrs Ita also regaled the audience with tales about her uncle, the late Asako Otu Nyong Edet Asido of Adiabo Okurikang in then Western Calabar (in today’s Odukpani Local Council).

His fame was such that he was revered in Victoria Town, Cameroun, Port Harcourt, Lagos and Calabar, places where he made his mark as a teacher.

But those days are gone, Oyo-Ita said. And the question society is currently grappling with is, “why are our teachers no longer feeling that amount of pride and accomplishment in their career? Where did we go wrong? I still remember then in those days when we were little, my mother used to tell us stories of how it was really fashionable and extremely prestigious to send your brilliant daughters to teacher training colleges, just as she attended Teacher Training College (TTC), Ifuho, Ikot Ekpene, Akwa Ibom State.

In those days, it was a thing of pride to introduce your daughter as a student of TTC and you were sure that there would be a long line of potential suitors, who would like to have such a lady as a wife as did my mother.

Also, children of teachers were always the lucky ones because at home we had a very good foundation educationally, and were ready to move to schools, where we would get the icing on the cake. So, you can see that we enjoyed both ways.”

All of these is to say that we long derailed. And the work is not up to governments alone.

The private sector must add its bit to see that teaching, the bedrock of development is not cobweb covered any longer.

In this year’s edition, teachers won N500,000 each as Grand Mentor Teacher’s Award in Mathematics, Physics, Chemistry and Biology while Elizabeth Uduak Michael of Holy Trinity College, Mbiakong, Uruan Local Government was adjudged the Best Principal

‘Irresponsible’ Amazon under fire in France Stories ny Onuwa Lucky Joseph

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ith all the poverty in the world and the lack of access to basic amenities suffered by people in the developed world, but more especially in the developing world, Amazon, in France, impudently destroyed thousands of goods (diapers, toys, Lego boxes, coffee makers, etc.) that were in perfect condition which they had just been unable to sell over the holiday season. The goods were neither recycled nor given to charity.

The Secretary of State for France’s ecological transition, Brune Poirson, lamented the development and promised, going forward, to make companies ‘responsible’ for such

practices. “In the coming months”, she said, “a law will be passed in Parliament that will outlaw this kind of activity. Companies like Amazon will no longer be able to throw away products that can still be used.”

This practice of destroying goods and products fit for consumption has dogged capitalism for a long time; that need to keep the market stimulated and on a high for the next fix of brand new factory rollouts; a practice that burdens the environment with avoidable waste which end up in landfills and sometimes in the world’s oceans.

The worst part is when perfectly consumable food is thrown into the ocean just so that prices can remain high or competitive. It’s a big parting point between such

minded capitalists and humanitarians/environmentalists who do not see the sense of it. Worst part, when food is the subject, it is usually a national policy rather than just a rogue corporate establishment’s decision.

This is one issue that the United Nations and other world bodies need to address this seriously and urgently.

Unfortunately, the levers of power are firmly in the hands of those likely to engage in this odious practice.

The job of exposing this dastardly Amazon practice fell to a resourceful journalist who sought and got employed by Amazon just so he could get an insiders’ view of the retail behemoth’s business practices. His footage of the destruction was run on an M6 Radio programme known as the ‘Capital’.

Vodacom takes robotics to students

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reat oaks from little acorns grow is a saying that guides development for individuals and corporates. And it is the thinking behind Vodacom Business Nigeria’s one-day robotics training it held recently for five secondary schools in Lagos.

The training which took place at the Canton Concourse Training Center, Victoria Island, in a relaxed and engaging atmosphere, gave the students the opportunity to open their minds to the various ways in which technology is shaping the world around them.

They were also equipped with useful mechanical and programming skills which can be honed and developed as they progress through the various levels of education.

The schools represented were • Dansol High School, Ikeja; • Edgefield College, Lekki; • Fruitful Ville College International, Ikorodu; • Halifield Schools, Maryland • Holy Child College, Ikoyi.

The students in attendance, aged 12 to 15, were given a firsthand opportunity to immerse themselves in the complexities that surround the Internet of Things (IoT) and how this will affect their lives in the near future.

As part of the programme, students were taught how to build, program

and control various kinds of robots which are used to perform numerous functions in today’s world. This, to demonstrate the essential nature of technology in everyday life, from manufacturing to transportation and even securing lives and property.

Solomon Ogufere, Commercial Director for Vodacom Business Nigeria said: “As a business, we are committed to equipping the next generation in Nigeria with the requisite ICT skills to prepare them for the inevitability that is the fourth industrial revolution. We believe that it is never too early or too late to begin this immersive process in students, thereby preparing them

for the post – digital age which will demand technical knowledge and skills.”

Vodacom Business Nigeria constantly seeks out opportunities to enhance the lives of the next generation through engagement in initiatives with primary focus on educational programs, capacity building sessions, training workshops, industrial tours and more. Earlier in the year Vodacom had organized an ICT Skills development training day for thirty-six young students from the S.S. Peter & Paul Nursery and Primary School, a school run by an independent non-profit organisation that serves the underprivileged communities in Lagos State.

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Corporate Social Impact

Mtn takes healthcare to Nigerian markets Short and

snappy

Stories by Onuwa Lucky Joseph

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lot of traders and market people have this overwhelming belief that they cannot afford the time for hospitals; at least that’s what they claim to believe until condition gets critical. Many otherwise easily reversible conditions have by such delays become complicated.

Knowing this lethargy on the part of traders and in order to ensure that their health is not compromised unduly, MTN Foundation took the hospital to the market. The medical outreach was all about providing free healthcare, no fear of fees and the like.

Were the market folks happy?

You bet.

The state governor, Akinwunmi Ambode was represented by the Lagos State Director of Disease Control, Eniola Erinosho. He spent good time imparting information about lifestyle and behaviour change to the attendees in order for them to enjoy optimal health. “Behavioral modifications he requested of them included “avoidance of smoking completely, including limiting exposure to smoke as passive smoking is very dangerous”.

He also urged them to reduce alcohol intake, eat balanced diets, drink at least three litres of water a day, reduce excessive sugar intake, go for foods and fruits that are in season and to also to avoid risky sexual exposure.

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The MTN Team comprised of Gbenga Oyebode, Director; Dennis Okoro, Director; Nwaeke Peter, Health Portfolio Manager for MTN Foundation; Taiwo Oshinusi, Director; all acknowledged the time constraint and financial difficulties the market people have to endure. They however emphasized the importance of proper healthcare. Reason why “we brought doctors, nurses, pharmacists to the

market so they can check their vital signs, basic health diagnoses and provide medication for free.

They also stated their goal as being to “provide medical assessment and treatment for malaria, hypertension, diabetes, aches and pains”.

The traders were happy to avail themselves the free healthcare but they weren’t alone. Customers made a beeline for the healthcare stands to,

as they say, kill two birds, maybe more, with one stone.

The scheme is scheduled to hold at Mile 12 Market, Ketu; Ayangburen Market, Ikorodu; and Folasade Tinubu Ojo, Gorodom on the Island.

Interestingly, according to Oshinusi, “we have opened up clinics in the market as follow up centres to monitor them until we see improvements.

Excellent scheme, we say.

he Advertisers Association of Nigeria (ADVAN) celebrated its 25th anniversary recently. And to commemorate the event, its executive laptops to Lanre Awolokun High School, Ikeja.

Inlaks Energy organised a training session on solar electricity generation for students of Vivian Fowler Memorial College The Nigeria Stock Exchange (NSE) presented a cheque and food items donated by employees of the NSE to Bethesda Home for the Blind as part of NSE Employee Give-Back Initiative aimed at extending a hand of care to the less privileged.

Mutual Benefits Assurance Plc held its Mutual Benefits 2018 Christmas Carol in Lagos with its Mutual Choir doing the renditions

Subaru of America Foundation Awards Girls Inc. of Greater Philadelphia & Southern New Jersey a $95,000 Grant

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irls Inc. of Greater Philadelphia & Southern New Jersey announced today that it has been awarded with a $95,000 grant from the Subaru of America (SOA) Foundation to be paid over three years to support Girls Inc.’s work in the Camden Promise Neighborhood. Girls Inc., a non-profit organization that inspires girls ages 6 to 18 to be strong, smart, and bold, launched their pilot program in Camden with a one year, $20,000 grant from the automaker’s Foundation in 2017. The response to the Girls Inc. programs from school partners, girls and their families was immediate, positive and exceeded expectations.

As a result, Subaru has made this very generous grant to serve even more girls in additional Camden schools.

It is undeniable that girls in the U.S. are uniquely affected by poverty, sexual exploitation, drug addiction, and teen pregnancy. Nationally, one in six girls will not finish high school, 78 percent of high school girls report being unhappy with their bodies, and one in five experience childhood sexual assault. In communities with increased poverty rates, these risks are even greater.

Headquartered in Camden, NJ, Subaru of America, Inc. wanted to help create a different narrative for their community. With a population of 74,420 individuals, only 56.2% of Camden residents are employed. The median household income is $26,214, resulting in 38.4% of Camden falling below the poverty line. Camden, NJ has one of the highest poverty rates in the country at 38.4% of its population of 76,005 with a

median household income of $26,214.

While high school graduation rates in Camden have been improving, only 64% are graduating. Likewise, while New Jersey ranked 5th in the nation in 2015 for teen birth rates (14.8 births for every 1,000 girls), the rate for 2014 data for Camden City showed an adolescent birth rate of 35.1 per 1,000.

Subaru of America decided to partner with Girls Inc. of Greater Philadelphia and Southern New Jersey to assist the organization in addressing the unique needs of girls through outreach programming, advocacy, and education, including the development of mentoring relationships. The non-profit’s research-based and developmentally appropriate programs empower girls to think critically and use problem solving skills to produce the best outcomes for themselves and their community.

Helping girls develop the tools they need to make healthy decisions about their bodies, receive academic enrichment and life skills instruction including exposure to career opportunities is critical to ensuring that they develop into self-sufficient women. Girls Inc.’s holistic approach towards whole girl development recognizes that none of these components in isolation will result in girls dreaming big and achieving their dreams. Subaru also recognized the lack of female representation in the automotive industry and wanted to help open opportunities and show pathways to careers that girls might not have considered.

Together, Girls Inc. and Subaru of America set out to empower young girls

in Camden. With the support of Subaru, Girls Inc. launched their programs in Camden during the 2017 – 2018 school year. The partnership focused on two middle schools and one primary school in the Camden Promise Neighborhood. By partnering with Camden schools, the mission was to provide not only tangible, but also sustainable learning opportunities for local girls.

Subaru sought to address the unique challenges that Camden faces and arm girls with the skills to enact change in their communities. They accomplished this by partnering with Girls Inc. to deliver school-based programs focused

on healthy decision making, media literacy, leadership development, community action, and STEM enrichment opportunities.

Results: At the end of the pilot school year, 111 girls cumulatively participated in 1,386 hours of Girls Inc. school-based programs. These amazing young girls experienced fun, engaging project-based STEM programs, college tours and through the Girls Inc. experience now have the tools to make healthy decisions about their bodies and to engage positively with their communities. Nearly all the girls are continuing their involvement with Girls Inc. this school year.

As more girls and their families look toward Girls Inc. as a resource, partnerships like the one with Subaru of America, Inc. have become critical to meeting the demand.

With this new three-year grant, the Subaru and Girls Inc. partnership will expand to serve 600 girls in the Camden Promise Zone. Through a career exploration partnership with Subaru, girls will also have an opportunity to explore careers in the automotive industry. (culled from 3BL Media) (Enquiries to csrmomentum@gmail. com /08023314782)

Thursday 24 January 2019

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World Business Newspaper

US Senate to vote on competing plans to end shutdown Hopes for solution remain dim as Republicans and Democrats stick to core demands Courtney Weaver

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he US Senate will vote on two proposals on Thursday to end the longest US government shutdown, but hopes for a long-term solution to the impasse remained dim, with both sides refusing to budge on their core demands.

Mitch McConnell, the Republican Senate majority leader, reversed his previous position on Tuesday to allow the votes. He had said earlier that he would only let the chamber consider shutdownrelated legislation that was backed

by President Donald Trump and congressional Democrats.

Mr McConnell called on senators to support a proposal put forward on Saturday by Mr Trump, which would allocate $5.7bn for border wall spending, and make a series of changes to the existing immigration system.

However, Mr McConnell also agreed to allow a short-term spending bill, backed by Democrats, to go up for a vote. That legislation would reopen the government until February 8 — giving Congress and the White House a two-week breather to find a solution to the crisis.

The short-term spending bill

would keep funding at current levels and offer temporary relief to the roughly 800,000 federal workers whose agencies are affected by the shutdown and who have spent the past month either furloughed or working without pay. The same bill passed in the US House of Representatives this month.

To pass the Senate, either bill would require 60 votes, a tall order in a chamber where Republicans hold a slim 53-47 majority, and few senators have shown signs of breaking rank.

On Tuesday, Democratic lawmakers sharply criticised Mr Trump’s latest proposal. The president’s plan offers temporary relief to people covered by the Deferred Action for Childhood Arrivals — an Obama-era programme that offered a path to citizenship for some 700,000 young undocumented immigrants. But Democrats noted that the relief would only last for three years.

Furthermore, Mr Trump’s proposal would create stricter rules for young asylum seekers. Children under the age of 18 would need to apply for asylum in their home countries, instead of at the US border. The president’s proposal would also put a cap on the number of children eligible for asylum in the US each year.

“The president said his propos-

Apple’s Tim Cook makes debut at World Economic Forum in Davos

Chief takes first trip to Swiss resort gathering amid ‘Big Tech’ backlash Tim Bradshaw

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im Cook is making his debut in Davos this week, as the Apple chief executive grapples with the growing geopolitical challenges facing his company and its Silicon Valley neighbours.

The backlash against “Big Tech” companies has been climbing up the agenda at the World Economic Forum in recent years, as political and business leaders fret about the outsized influence of Apple, Amazon, Facebook and Alphabet, who together command $3.5tn in market value.

Mr Cook was photographed in Davos on Tuesday night dining with Satya Nadella, chief executive of Microsoft, which recently overtook Apple as the world’s most valuable company, and the Brazilian president Jair Bolsonaro. He was also pictured chatting with the Armenian prime minister, Nikol Pashinyan, and on Wednesday he is scheduled to meet Italian prime minister Giuseppe Conte.

Tech executives from Salesforce. com founder Marc Benioff to Facebook’s embattled operating chief Sheryl Sandberg have become a familiar sight at the World Economic Forum, but Apple has traditionally remained largely absent from such events.

Apple’s first appearance at the WEF comes after the iPhone maker’s tumultuous start to 2019. Apple said on January 2 that its revenues would miss Wall Street’s estimates, its first such warning since 2002, triggering

its largest one-day share-price drop in five years.

Apple is now the world’s fourth most-valuable company, behind Microsoft, Amazon and Alphabet.

Mr Cook pinned the blame for Apple’s sales shortfall squarely on China, where he said tensions over the trade war with the US had hit consumer spending. “While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China,” Mr Cook said in a letter to investors.

Alongside trade, Mr Cook is likely to be discussing data protection — one of the tech industry’s most contentious topics following Facebook’s privacy scandals last year — as well as competition policy in Davos.

“One of the biggest challenges in protecting privacy is that many of the violations are invisible,” Mr Cook wrote in Time magazine last week, calling for the US Federal Trade Commission to establish a “data-broker clearinghouse”. “All of these secondary markets for your information exist in a shadow economy that’s largely unchecked — out of sight of consumers, regulators and lawmakers.”

Delegates at the Swiss resort have already been discussing issues such as the global governance of data, as local protections for privacy in Europe stand in contrast to increasing online surveillance in China. The impact of artificial intelligence on jobs and the expansion of 5G, a focus for national security concerns between the US and China, are also likely to be on the tech industry’s agenda in Davos.

One of the Senate votes will be on President Donald Trump’s plan, which would allocate $5.7bn to border wall spending © Reuters

al was a reasonable compromise.

In fact, it is neither reasonable nor a compromise,” Chuck Schumer, the leader of the Democrats in the Senate, said on Tuesday.

Mr McConnell praised Mr Trump for trying to find a solution

to the impasse.

“To reject this proposal, Democrats would have to prioritise political combat with the president ahead of federal workers, ahead of Daca recipients, ahead of border security, and ahead of stable and

predictable government funding,” Mr McConnell said.

“Is that really a price that Democrats want to pay to prolong this episode, which they say they want to be over and done with?” he asked.

Why Nissan and Renault need each other

Unwinding the troubled car alliance may be difficult and counter-productive, warn analysts Kana Inagaki and David Keohane

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hen Nissan’s chief executive Hiroto Saikawa addressed employees shortly after the arrest and dismissal of Carlos Ghosn in November, he painted a bleak picture of a company that had suddenly lost its captain.

It is a sharp contrast with the early days of Mr Ghosn’s leadership, when he achieved a rare turnround of Nissan from near bankruptcy in 1999 through cost savings driven by a highly efficient alliance with France’s Renault.

But, in more recent years, Nissan’s fortunes have darkened again. Profitability has been eroded as the company has overstretched itself in the US, neglected its home market in Japan, and missed its opportunity in India.

“We are trying to correct what we have done wrong,” Mr Saikawa said in his address.

Key data highlight the problems at Nissan. Operating profit margins are the lowest among almost all of the world’s biggest carmakers at 3.6 per cent, even with billions of dollars of cost savings achieved through a RenaultNissan alliance that now includes Mitsubishi Motors.

“It’s essential to make use of the alliance, if we consider the many challenges the auto industry faces. I’ve never thought for once that it was a mistake to join this alliance,” said Mitsubishi chief executive Osamu Masuko.

But decisive action and strong leadership are now needed more than ever.

This explains why Renault is finally moving to replace Mr Ghosn, their chairman and chief executive, who looks likely to languish in prison for months on charges, which he denies, of financial misconduct. His latest bail request was rejected on Tuesday.

Last week the French state, which has a 15 per cent stake in the carmaker, said Renault needed “sustainable governance”, something it could not have with Mr Ghosn behind bars and titularly in charge.

A board meeting is scheduled for Thursday that is expected to appoint as chairman Jean-Dominique Senard, chief executive of tyremaker Michelin.

Thierry Bolloré, who is running Renault on a day-to-day basis, is favourite to become chief executive.

This may be the start of the real test for the company, say people close to the group, as investors begin to digest the full financial fallout from the crisis.

Indeed, so far shares have not fared too badly with Nissan 9.5 per cent lower since Mr Ghosn’s arrest and Renault suffering a 12 per cent fall.

“Shares of both Nissan and Renault have fallen (after Mr Ghosn’s arrest). But this is just the tip of the iceberg,” said one industry executive. “When people see the consequences of this distraction, it’s going to be a lot worse.”

In short, the task of reshaping the three car alliance to fit the post-Ghosn

era is likely to be highly complicated and wrought with political minefields as the main players jostle in the race for ultimate control.

It is not helped by the lack of trust between the two main allies, which is at an all-time low after Renault questioned the way Nissan handled Mr Ghosn’s dismissal.

Nissan’s expanding internal investigation into the former boss’s financial affairs globally has also been deeply distracting, triggering the departure of several of Nissan’s senior executives who were close to Mr Ghosn.

Much of the investor attention has focused on tensions created by the disproportionate capital structure of the alliance where Renault holds a 43 per cent voting stake in Nissan while the Japanese partner holds a 15 per cent stake in the French group with no voting rights.

The imbalance became even more pronounced as Nissan became the bigger partner, generating half of Renault’s net profit, which hit a record in 2017.

To sustain the alliance, Mr Ghosn had considered merging the two companies under a holding company structure, which would have been established in the Netherlands, according to people familiar with the plan.

But some factions within Nissan are opposed to deeper integration, which they think will not make the Japanese group stronger, according to people close to the company.

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Thursday 24 January 2019

NATIONAL NEWS

FT US turns down China offer of preparatory trade talks

The mask slips as Zimbabwe’s crocodile bares his teeth

Cancellation of Washington trip shows difficulties of reaching deal by March

Emmerson Mnangagwa’s crackdown is as vicious as anything seen in the Mugabe era

Tom Mitchell, Yuan Yang and James Politi

David Pilling

T

T

he Trump administration rejected an offer by two Chinese vice-ministers to travel to the US this week for preparatory trade talks because of a lack of progress on two key issues, highlighting the difficulty that Washington and Beijing will face in trying to reach an agreement by a deadline of March 1.

This week’s planned trip by Wang Shouwen and Liao Min was intended to pave the way for a higher-level meeting in Washington on January 30 and 31 by Liu He, China vice-premier, and Robert Lighthizer, US trade representative.

But, according to people briefed on the negotiations, US officials cancelled this week’s face-to-face meetings with Mr Wang, a vice-minister of commerce, and Mr Liao, a vice-minister of finance, because of a lack of progress on “forced” technology transfers and potentially farreaching “structural” reforms to China’s economy.

The two issues could ultimately derail the talks and cause more worry for financial markets. Investors are already jittery about the consequences of escalating tensions between the two largest economies. If an agreement is not reached by March 1, President Donald Trump has said he will more than double the punitive tariff rate imposed on about half of all Chinese exports to the US, from 10 per cent to 25 per cent.

Larry Kudlow, the president’s top economic adviser, said on Tuesday afternoon that no “intermediate meetings” had been scheduled with Chinese delegates and denied there had been any cancellation. The US was still preparing for its planned meeting with Mr Liu at the end of the month, he said.

“The story is unchanged. We are moving towards negotiations,” he told CNBC. US negotiators are demanding that Beijing end what they allege are “forced” technology transfers from foreign companies to Chinese joint venture partners and other firms. They also want President Xi Jinping’s administration to scrap state subsidies and industrial policies that they believe discriminate against foreign investors.

Mr Trump’s negotiators wanted Mr Liao, one of Mr Liu’s closest aides, and Mr Wang to come to face-to-face talks in Washington with a written offer outlining how Beijing intended to address US complaints about technology transfers and structural reforms.

But, according to the people briefed on the stalemate, Mr Xi’s negotiators are refusing to alter their longstanding position that foreign companies are not forced to transfer technology to Chinese companies.

They also argue that Beijing’s recent offer to improve market access for foreign investors in certain sectors — and strengthen protection of intellectual property — should address US concerns.

While preparations for Mr Liu’s visit to Washington next week are continuing, the Trump administration’s refusal to receive Mr Wang and Mr Liao this week shows how large a gap still exists between the two sides’ positions.

The price of US soyabeans, which is linked to the health of US-China trade, fell as much as 1.9 per cent to $8.995 a bushel after the Financial Times first reported on the cancelled talks, before closing down 0.8 per cent at $9.0925 a bushel. The S&P 500 ended 1.4 per cent lower, its worst one-day performance since January 3.

President Muhammadu Buhari is locked in a tight race with Atiku Abubakar, the leading opposition challenger in next month’s presidential poll © AFP

Nigerian presidential hopeful vows to rewrite oil deals Atiku Abubakar says he will renegotiate crude production contracts if he wins election Neil Munshi

A

tiku Abubakar, the leading opposition challenger to Nigeria’s president, has said he would seek to overhaul oil production deals with international companies and push for energy reforms if he won next month’s presidential election.

In a warning to oil majors, Mr Abubakar said he would aim to renegotiate production-sharing contracts Nigeria has signed with big businesses such as Shell, Exxon and Chevron to develop oil blocks in Africa’s biggest crude-producing country.

“I believe we need to review it to make it . . . more fair,” he said, adding that the current terms favoured international businesses.

Mr Abubakar is locked in a tight race with President Muhammadu Buhari and is pitching himself as a pro-business candidate who will jump-start Nigeria’s economy, which has barely recovered from a recession brought on by the oil price crash.

Gail Anderson, analyst at Wood Mackenzie, said oil majors would be concerned about changes to their production deals. “Everyone knows that [terms for offshore oil] will get tougher one way or another, but the question is will the balance be right between investor and state?”

Mr Abubakar, a businessman who made his fortune in oil and gas logistics, conceded that renegotiations with oil companies could

be tough. “They will try to defend [current terms] because recovery of their investment is going to be a little longer . . . but it all depends on the stability of the regulatory framework,” he said.

The opposition candidate said he wanted to prepare the ground by passing a set of oil sector reforms.

They include setting up an independent regulator and breaking up the Nigerian National Petroleum Corporation, the state oil company.

Mr Abubakar said those steps would spur investment in a moribund industry. “I’m going to work with the national assembly to make sure that [the reforms are] passed because it is going to make the oil and gas sector predictable for foreign investment,” he said in an interview at a business forum in Lagos.

The regulatory overhaul — known as the Petroleum Industry Bill— has been in the works for roughly two decades and dates back to the era when Mr Abubakar served as vicepresident.

He said there had not been “substantive investment” in the oil and gas sector for several years. PwC estimates that regulatory uncertainty is keeping $40bn of potential foreign investment out of Nigeria.

The only significant investment in recent years was the Egina project led

by French oil major Total, which has a capacity of 200,000 barrels per day and has begun pumping its first oil.

At the business forum, Mr Abubakar called the NNPC a “mafia organisation” and reaffirmed a vow

to break it up and privatise it by selling off state-owned refineries through a combination of listings, public-private partnerships and other mechanisms.

The latest attempt at passing the oil reform bill involved breaking it into four parts. The first section passed the legislature last year, but Mr Buhari refused to sign it in August. He has since pledged to sign a reworked version of the bill.

Annual oil production in Nigeria fell 26 per cent in the decade to 2017, according to the US Energy Information Administration. While some of the decline can be explained by militancy in the Niger Delta region, analysts also point to the fact that older fields are not being replaced by investment in new fields as wary investors steer clear.

The petroleum reform legislation is designed to bring transparency to the opaque state-run NNPC, which has long been seen as a cash cow for the political class. It would strip the oil minister of the ability to award, revoke or renew licences.

Like some of his predecessors, Mr Buhari also appointed himself oil minister. Mr Abubakar said he would not also serve as oil minister because he was “not qualified”.

While passage of the bill and related reforms are expected to spur investment, Charles Robertson, chief economist at Renaissance Capital, said he was not making any projections yet. “After . . . years of waiting, I’ve given up forecasting FDI growth from passage of the PIB.”

Matteo Salvini accuses France of ‘stealing’ Africa’s wealth League leader links migration crisis with French colonial history Alex Barker

M

atteo Salvini has accused France of “stealing wealth” from African countries in the latest salvo in the spat between Paris and Rome over Europe’s migration crisis.

The head of the anti-migration League party on Tuesday followed the lead of the Five Star Movement, his coalition partner, in linking France’s colonial history in Africa to the influx of refugees into Europe.

“In Africa there are people who steal wealth from the population.

France is obviously among them,” Mr Salvini said in an interview on Italian television. “In Libya France has no interest in stabilising the situation because it has oil interests opposite to those of Italy.”

He added: “Let us not take lessons from France which in recent years has

rejected tens of thousands of migrants at the border [between France and Italy], including women and children.”

Mr Salvini’s comments marked a further deterioration in FrenchItalian relations since he and Mr di Maio formed a collation government last year.

Emmanuel Macron in 2017 likened the rise of populist politics across Europe to “leprosy”, while Mr Salvini has repeatedly attacked the French president for what he argues is a hypocritical approach to the flows of migrants from north Africa entering southern Europe.

On Monday France summoned Teresa Castaldo, Italy’s ambassador to Paris, after Mr Di Maio accused France of continuing to “colonise” African countries.

“If we have people who are leaving Africa now it’s because some European countries, France in particular, have never stopped colonising Africa,” Mr

Di Maio said at a Five Star event on Saturday.

“If France didn’t have its African colonies, because that’s what they should be called, it would be the 15th largest world economy. Instead it’s among the first, exactly because of what it is doing in Africa.”

This month Mr Di Maio prompted a furious reaction from Paris by pledging his support to the gilets jaunes protesters, saying his party would provide them with assistance.

In response Nathalie Loiseau, the minister for European affairs, said Italy “should learn to clean up their own home”.

The worsening relations between Paris and Rome have also seen politicians within Mr Salvini’s League threaten to block the loan of paintings

by Leonardo da Vinci to the Louvre in Paris for an exhibition celebrating the 500 years since the artist’s death.

his week, Emmerson Mnangagwa, president and ostensible new face of Zimbabwe, cut short a foreign trip, skipping Davos to attend to things at home “in light of the economic situation”. In his utter failure to capture the gravity of events, Mr Mnangagwa echoed Japan’s Emperor Hirohito who, after Hiroshima and Nagasaki had been vaporised by atomic bombs, declared that “the war situation has developed not necessarily to Japan’s advantage”.

Presumably he would have skipped Davos, too.

The truth that Mr Mnangagwa missed in his milquetoast assessment is this: Zimbabwe is bankrupt.

Zimbabwe is on fire. The crisis, years in the making, was ignited 10 days ago when the president announced on TV that petrol and diesel prices would more than double to $3 a litre.

Having dropped his bombshell, he absconded to Moscow, leaving the country in the hands of his nominal deputy, General Constantino Chiwenga.

In what has become a national “good cop, bad cop” routine, Gen Chiwenga — architect of the 2017 coup that brought Mr Mnangagwa to power and a man who looks suspiciously like the country’s de facto ruler — ordered a crackdown on the inevitable protests that followed.

For long-suffering Zimbabweans, the fuel price rise was the final straw.

It topped months of economic meltdown that have stripped supermarket shelves bare and sucked any remaining value from the country’s phoney electronic currency. Zimbabwe’s paper notes were scrapped a decade ago after raging hyperinflation. That the country survives at all is due almost entirely to the dollars sent home by the millions of Zimbabweans forced to seek a livelihood abroad.

Bus fares rose with fuel prices.

Many Zimbabweans now spend the entirety of their earnings getting to and from work. Destitution or worse beckons. Even police have been spotted traipsing for miles with handcuffed prisoners because their vehicles have no petrol.

For years, Zimbabwe’s people have suffered silently, both through fear of reprisal and because of civic norms that shun violence. For many, the fuel price rise proved too much.

The trades union congress called a general strike. In Harare, the capital, and Bulawayo, a centre of opposition to the ruling Zanu-PF, youths barricaded streets and even attacked police stations.

If Max Weber’s definition of a state is a group with a monopoly on violence, it is a definition ZanuPF takes to heart. Gen Chiwenga’s military responded with a crackdown every bit as vicious as during the era of former president Robert Mugabe.

Soldiers fired live rounds at demonstrators. They went house to house, beating up people and dragging off youths to prison. So indiscriminate is the violence that even people who voted for Zanu-PF are victims.

George Charamba, once the spokesman of Mr Mugabe and now the voice of President Mnangagwa, described the crackdown as “just a foretaste” of things to come. He accused the opposition Movement for Democratic Change, which claims it was defrauded in last year’s election, of seeking power through blood.

Thursday 24 January 2019

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52

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Bank of Japan holds rates steady but trims inflation outlook Central bank says progress on inflation still ‘relatively weak’ despite tight job market classed the revision to inflation foreAlice Woodhouse and casts as “sharp”, but expects the BoJ Edward White to keep policy on hold “beyond next he Bank of Japan kept year”. He added: If the Bank decided to raise ininterest rates on hold on Wednesday but lowered terest rates, it would be because its inflation expectations of concerns about the impact of monetary easing on the health of for the 2019 fiscal year.

The BoJ kept its short-term inter- financial institutions. But today’s est rate target at minus 0.1 per cent, report didn’t indicate that the Bank is in a seven to two vote, and reaffirmed getting more worried, as it repeated its plan of buying Japanese govern- the line from October’s report that ment bonds to maintain yield on the it was “necessary to closely monitor future developments.

10-year note at around 0 per cent.

Over the past year the BoJ has In its quarterly outlook report, the bank also lowered its forecast for moved out of step with tightening consumer prices excluding fresh food moves in the US and Europe as — a gauge known as core inflation — central bankers around the world to rise by between 1 per cent and 1.3 responded to stronger growth.

Haruhiko Kuroda, the BoJ goverper cent year on year in 2019, down from a range of 1.5 per cent to 1.7 per nor, is expected to give a press conference later on Wednesday in Tokyo. cent it outlined in October.

The Japanese yen extended early The bank, which has a target inflation rate of 2 per cent, said “the rate of losses against the dollar following the change in the consumer price index BoJ announcement to be 0.4 per cent has been positive but continued weaker at ¥109.75.

Wednesday’s rates decision came to show relatively weak developments compared to the economic as data showed Japanese exports last expansion and the labour market month shrank at their quickest rate two years, as Japan joined the growtightening.”

Marcel Thielant, senior Japan ing list of Asian nations reporting a economist for Capital Economics fall in the metric at the end of 2018.

T

Asia stocks fall on global growth and US-China trade worries Edward White

A

sia-Pacific equities were lower in early trading on Wednesday led by a decline for energy stocks and amid weakening sentiment over global growth and concerns over trade talks between the US and China.

The Topix in Tokyo was off 0.8 per cent with only the telecoms and utilities segments holding in positive territory and as energy stocks fell 2.2 per cent. In Sydney, the S&P/ASX 200 was down 0.1 per cent with a 1.1 decline for energy stocks and a 0.8 per cent fall for the mining segment. Ahead of the open in Hong Kong, Hang Seng futures were off 0.4 per cent.

Oil prices have come under pressure amid “concerns over global economic growth amid renewed trade tensions”, said Soni Kumari, an

analyst at ANZ. Ms Kumari added, however, that those concerns are not expected to outweigh falling production among major producers, and she noted that US drilling activity has been slowing down, which could cap shale production growth in the US in 2019.

The fall for stocks also came after the S&P 500 snapped its winning streak overnight, closing 1.4 per cent lower. Pessimism over global growth has mounted this week after the IMF lowered its global outlook and China released data showing its slowest annual GDP growth in almost three decades.

The Trump administration rejected an offer for Chinese officials to travel to the US this week for preparatory trade talks, in a blow for hopes over a resolution to the US-China trade dispute and further fuelling market uncertainty.

Fast Europe Open: France business sentiment, UK industrial trends Edward White

T

he Trump administration has rejected an offer by two Chinese vice-ministers to travel to the US this week for preparatory trade talks because of a lack of progress on two key issues, highlighting the difficulty that Washington and Beijing will face in trying to reach an agreement by a deadline of March 1.

This week’s planned trip by Wang Shouwen and Liao Min was intended to pave the way for a higher-level meeting in Washington on January 30 and 31 by Liu He, China vice-premier, and Robert Lighthizer, US trade representative.

But, according to people briefed on the negotiations, US

officials cancelled this week’s face-to-face meetings with Mr Wang, a vice-minister of commerce, and Mr Liao, a viceminister of finance, because of a lack of progress on “forced” technology transfers and potentially far-reaching “structural” reforms to China’s economy.

Weakening sentiment over global growth and the US-China trade talks dragged equities lower in Asia-Pacific trading, although China-focused stocks and the renminbi saw a lift thanks to a liquidity boost from China’s central bank.

Futures tipped a mixed start for Europe and the US, with the FTSE 100 set to open down 0.2 per cent when trading starts in London while S&P 500 futures were 0.2 per cent higher.

Rural areas boosted by banks’ move to prevent ATM deserts

Cash machine operators to receive subsidy increase Nicholas Megaw

B

ritish banks are to increase the subsidy they pay to cash machine operators in rural areas by up to nine times, in the latest effort to prevent “ATM deserts” leaving people outside cities and large towns without access to cash.

ATM operators will from April receive a “super premium” of up to £2.75 per transaction in the most isolated or deprived areas, up from 30p at the moment, under a plan brokered by Link, the inter-bank organisation that manages the UK’s cash machine network.

John Howells, chief executive of Link, said: “While many consumers are turning to alternative payment methods such as contactless cards, it is vital we continue to provide free access to cash to those who need it. These premiums will further safeguard ATMs in remote and less well-off areas.”

Link said the subsidy is more than the average charges incurred by con-

sumers at a pay-to-use ATM, meaning that it could also encourage some cash machine operators to scrap these fees.

The “super premium” plan is the latest in a series of moves by Link to limit the number of ATM closures in rural areas.

A row erupted in 2017 over proposed reductions by Link in the fees paid by debit and credit card issuers to ATM operators, which warned thousands of cash machines would become economically unviable.

The number of free-to-use ATMs in the UK fell by 1,300 between February and July last year, to 53,200.

Link initially proposed to reduce the interchange fees paid by card issuers for each cash withdrawal from 25p to 20p in stages over four years, but cancelled one of the cuts after pressure from campaigners and politicians.

The argument caused divisions among Link’s members, which includes both major banks and inde-

pendent cash machine operators such as Notemachine and Cardtronics.

A spokesperson for Cardtronics said it “welcomes any initiative that will help to retain free access to cash”, and added that “ultimately we need to find a solution in which Link protects free access to cash for everyone in the UK — not just specific areas”.

Interchange fees cost banks hundreds of millions of pounds each year, and they have argued that much of the ATM network is inefficient, with many machines clustered in the same areas.

With customers increasingly moving away from cash payments, the banks said that their fees — and the number of machines — should shrink, threatening independent ATM operators’ business models.

A senior executive at one of the UK’s largest high street banks said “the ATM argument got sidetracked by the independents — the interchange payments for machines in the countryside didn’t even go down”.

Asia stocks choppy on US-China trade concerns Hudson Lockett

S

tock markets were in flux on Wednesday in Asia following a rough day on Wall Street and after the Trump administration rejected an offer for Chinese officials to travel to the US this week for preparatory trade talks.

In Tokyo the Topix was off 0.1 per

cent with only the telecoms and technology segments in positive territory while energy stocks were down 1.5 per cent. In Sydney, the S&P/ASX 200 was flat as a 1.7 per cent decline for energy stocks and a 0.8 per cent fall for the mining segment offset gains elsewhere.

Stocks in Seoul were more buoy-

ant as the Kospi climbed 0.5 per cent, while Hong Kong’s Hang Seng rose 0.4 per cent after an initial dip, although technology stocks remained in the red with a fall of 1 per cent. China’s CSI 300 edged up 0.1 per cent.

Overnight in the US, the S&P 500 finished the day down 1.4 per cent on return from a long weekend.

Analysts grow gloomy on global profit growth

Dim forecasts buck the upbeat trend of recent years Robin Wigglesworth

W

all Street’s expectations for global corporate profit growth have dimmed significantly, with analysts now forecasting that earnings per share will rise just 6.5 per cent in 2019. That comes as concerns grow over the fading health of the international economic expansion that excited investors just a few months ago.

Back in October the consensus estimate of investment bank analysts was that global EPS would grow 10 per cent in 2019. The downgrade to less than 7 per cent now reflects cuts in forecasts across the US, Europe and the developing world, according to

strategists at Citi.

The shift mirrors a pattern of earnings expectations gradually falling through the year that has held through most of the post-crisis era. However, that trend looked like it had ended in 2017-18, when corporate profit growth ended up being faster than anticipated at the start of those years.

This time, however, every major market has seen earnings growth expectations taper over the past three months, according to Citi. By sector, only US utilities and Japanese communications services have seen modest upgrades.

Robert Buckland, Citi’s chief global equities strategist, reckons the consensus is still too optimistic. The US bank’s

team of analysts forecast that global EPS growth will slow to just 4 per cent in 2019, a dramatic deceleration from last year’s profit expansion, which is expected to clock in at about 15 per cent.

Nonetheless, Mr Buckland points out that global equity markets can still turn a profit despite glummer forecasts.

Stocks have seen positive annual returns even as earnings growth slows, 15 times since 1989.

“Maybe this reflects that investors had already moved to price in weaker EPS before most years start. Indeed, we think that has happened this time round,” Mr Buckland wrote in a recent report. “In addition, we suspect that the market has learnt that analysts are usually too optimistic.”

53

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Thursday 24 January 2019

ANALYSIS Capital raising by US oil companies falls sharply Exploration and production sector has not had a single bond sale since November Ed Crooks

C A trucker’s guide to post-Brexit disruption As fears grow of a return to customs checks, the FT follows a British driver on his tightly scheduled journey across the continent Chris Giles

I

“

t’s pretty fresh this morning,” Wayne Widdecombe calls out of the cab of his 40-tonne truck sitting in a frosty industrial estate on the outskirts of Bourg-en-Bresse, more than 400km south-east of Paris. He had parked nearby and slept on a mattress behind the driving seat on one of his regular threeday round trips between Folkestone, near the Channel tunnel entrance, and Turin in northern Italy.

Ahead is what he hoped to be a seamless 11-hour trip lugging car parts for Jaguar Land Rover back to his UK depot. The 78 plastic boxes in the trailer contain the fans for engine cooling systems that have been manufactured by Johnson Electric at its plant in Asti in the Italian industrial heartland. They need to arrive at JLR in Birmingham on Thursday — a small part of Europe’s highly integrated, just-in-time automotive supply chain.

The trip is a chance to put theory aside and witness first-hand the reality of Britain’s current “frictionless” trade within the EU to help understand how that might change after Brexit. If Britain ends up leaving the EU without any agreement to remain in the customs union, it is journeys like these that will be the most important stress points.

The experience suggests a logistics system where everything is compressed — from the time that trucks need to deliver the goods to the tiny profit margins for haulage companies. And even without any customs procedures on the border, the Channel tunnel is already under intense pressure because of the weight of traffic and security fears about stowaways.

Truckers and Brexit - Wayne Widdecombe’s route map Mr Widdecombe’s truck is owned by Alcaline, a haulage company near Folkestone, which largely operates on the Anglo-Italian route, specialising in luxury car parts. For the whole transport equipment sector, including finished cars, Britain exported £4.4bn of products in 2017 and imported £6.3bn from Italy.

The cab of his lorry is less than a year old, left-hand drive because it operates mostly on the European continent, and already has 143,000km on the clock. We are soon on the autoroute heading north at a speed-limited 90km/h (56mph) in the direction of Calais.

Time is everything. Drivers are supposed to take an 11-hour break between shifts. But because Mr Widdecombe had a three-hour break the day before, he was only required to stop for a mandatory nine-hour daily break and he wanted to get started early. “I’m not a great fan of driving at night but, because of what we do, the goods have to be

there,” he says.

This is a regular run for him.

Leaving Folkestone on a Monday, he aims to be as close to Lyon as possible before stopping, then over the Alps on Tuesday to Turin, where he has a break, and returns over the Alps in the evening before driving back to the UK on Wednesday. On Thursday, he will then go out half the way, meet an Italy-based Alcaline driver, swap trailers and return to his home in Folkestone on Friday.

Hailing from Devon, Mr Widdecombe, 49, has been driving European routes for the past 15 years.

But with internet on his phone, he can have British radio playing as he barrels up and down French motorways. “I like to listen to Nigel Farage on LBC, for my sins,” he says soon after we set off.

He has strong views about the practices of drivers from other EU countries. “The Italians never seem to be speed restricted. They’ll all do 95 [km/h],” he says. France’s gilets jaunes protests have caused him much grief in recent weeks, especially as he thinks they had the support of some French police when barricading roads and holding up hauliers, but he respects their solidarity.

And he blames eastern Europeans for holding down pay among truck drivers. “No one pays well. I was making exactly the same money 10 years ago — it’s like they’ve fixed it. I’m being reasonable here — don’t need a million quid a week.” By paying a salary of £30,000, he says, UK-based hauliers struggle against eastern European rivals who pay their drivers less than half his wage.

“It’s very competitive. The eastern Europeans undercut everyone.”

As it becomes light, we take a coffee break, and pull off the A5 shortly before turning on to the A26, the motorway known as L’Autoroute des Anglais for the sheer weight of British traffic heading south through Champagne country wanting to avoid Paris.

With Brexit such a polarising topic in the UK, it is the first time we’ve talked about it. Here, Mr Widdicombe’s views are far from those of Mr Farage, the Brexit champion and former leader of Ukip who he listens to on the radio. “I didn’t vote, so I don’t have a say,” Mr Widdecombe says. “I would vote Remain next time. That’s just because of my job.

“People voted on immigration,” he adds. “I’ve got no problem with people working and paying into the system.”

After a little over 20 minutes, we’re back on the road, with the tachograph, the machine in the cab recording truck drivers’ hours according to EU regulations, telling us we have under an hour of driving time before we need to make another stop for at least 30 minutes.

Non-EU migrants and the criminal gangs who try to smuggle them from France to the UK are a daily problem for drivers on the stretch of road up to Calais. Mr Widdecombe has twice had people break into his load and, if they are found in the UK, the driver is held responsible.

In both cases he had suspicions and reported his concerns to the authorities. Now that camps have been cleared from Calais, the risk has moved south, so Alcaline forbids its drivers from stopping — even to go to the toilet — anywhere north of Reims, some 275km from Calais.

Mr Widdecombe’s bosses, with whom he gets on well, can check at any time where the truck is and regularly call in to ask him “how you getting on?”, even though they already know. For him, this is much better than working for a haulier that uses a computerised fleet management system, in which every move is controlled by an algorithm and orders come by screen message.

The tachograph is now saying we have 15 minutes before the mandatory break and, because he has driven the route so often, Mr Widdecombe knows we can just make it to the next layby to park, which we do with seconds to spare.

Mr Widdecombe gets out a camping stove, opens his fridge and makes tea. After the break, he checks the load and seals it with an additional security lock. The plastic boxes are stacked from floor to ceiling of the trailer and there is no physical space for anyone to stow aboard. On the trip out to Turin on Monday, he was carrying a mixed load of heavy magnesium oxide and multiple smaller loads grouped together. These are documented on the consignment note, a part-handwritten and part-typed document that describes the load and the dispatch and arrival points.

This is the extent of the paperwork for the loads he carries.

The car parts business is mostly a one-way trade for Alcaline, with Italian components coming in for JLR, Aston Martin, McLaren, Bentley and Rolls-Royce. On the return trip, it often takes just empty plastic boxes folded flat. Alcaline needs to fill all the trucks on both trips, says the owner, Lorenzo Zaccheo, just to make a 1.5 per cent profit margin when nothing goes wrong.

David Zaccheo, the operations manager at Alcaline in Hythe, organises the company’s logistics. Margins are tight and delays are costly With 330km still to go before the Eurotunnel entrance near Calais it means a little under four hours more driving, with the scenery becoming steadily less interesting. Mr Widdecombe dislikes this part of the drive and he is expecting a far from frictionless experience at the Channel tunnel.

apital raising by US oil exploration and production companies has fallen sharply following the decline in crude prices that began last October, pointing to cutbacks in capital spending budgets and a continuing slowdown in activity.

Companies in the sector have not held a single bond sale since the start of November, according to Dealogic, while share sales have also slowed.

The data suggest that after a recordbreaking boom in US oil output in 2018, growth will be weaker this year.

The government’s Energy Information Administration has forecast that between December 2018 and December 2019, US crude production will rise by about 500,000 barrels a day. That would represent a sharp slowdown from growth of 1.8m b/d over the previous 12 months.

The US shale industry has relied heavily on debt to finance its growth, with exploration and production companies raising about $300bn from bond issuance over the past 10 years.

As crude prices started to slide last October, that source of capital was choked off, with just three bond

Hess Corporation who was also on the same panel, said shale producers were now contending with a new financial climate. “The investor paradigm is changing.”

Weak share prices have also been a deterrent to capital raising. Share issuance by exploration and production companies has slowed sharply, with just $157m raised from equity sales in the past four months as the S&P oil and gas exploration and production sector index has fallen 29 per cent since October. There has not been an initial public offering of an oil and gas company for more than a year, and companies that were looking at possible flotations are expected to wait for markets to recover.

“We have a great IPO backlog, but not much IPO activity,” said Osmar Abib, co-head of energy at Credit Suisse. “We are getting ready, but owners are not going to go out at a substantial discount and give away value.”

With new capital constrained and cash flows squeezed by the weaker crude price, oil production companies are expected to rein in their plans for drilling and completing new wells. The number of rigs drilling oil wells in the US has already dropped by about 8 per cent since November to 889, according to S&P Global Platts

The US shale industry has relied heavily on debt to finance its growth, with exploration and production companies raising about $300bn from bond issuance over the past 10 years © AFP

sales by exploration companies that month, and none at all since November, according to Dealogic.

US benchmark crude dropped from a peak of about $76 a barrel in early October to about $42 at Christmas, before recovering to about $53 this week.

Ken Monaghan, co-head of high yield at Amundi Pioneer, the fund management group, said the rise in exploration and production companies’ debt yields had put off potential borrowers, with spreads over US Treasury bonds climbing from 3.9 to 7.5 percentage points at their peak before settling back to about 5.9 percentage points this year.

“No one wanted to issue debt unless they had to,” Mr Monaghan said.

“At the peak, they would have been looking at yields of about 10.25 per cent. That’s awfully expensive.”

Henry Peabody of Eaton Vance, another fund management group, said that for the time being debt and equity investors were aligned in encouraging oil producers to pursue cash generation rather than borrowing more to pursue growth. “No one wants to get caught out over their skis,” he said.

Speaking on a panel at the World Economic Forum in Davos on Wednesday, Vicki Hollub, Occidental Petroleum’s chief executive, said US shale oil companies were being forced to react to an investor push for more spending discipline. “Not as much money is going to be pouring into the Permian basin,” she said.

John Hess, chief executive of

Analytics.

Paal Kibsgaard, chief executive of oilfield services group Schlumberger, told analysts on a call last week that given a steady recovery in US crude prices to last year’s average of about $65 a barrel, it expected investment in onshore exploration and production in the US this year to be “flat to slightly down compared to 2018”.

The companies with the greatest access to capital are the big international oil groups, many of which have been building positions in shale oil and projecting steep production growth. Chevron said last month that about a quarter of its planned $20bn capital spending this year would go to the Permian Basin of Texas and New Mexico and other shale investments.

Merger and acquisition activity in the US exploration and production industry picked up sharply last year, with BP’s $10.5bn purchase of BHP’s shale assets the largest deal, and international oil companies could be buyers again this year, analysts and advisers say. Royal Dutch Shell has been reported to have been looking at buying privately held Endeavor Energy Resources, a leading holder of drilling rights in the Permian Basin.

Tim Perry, also of Credit Suisse, said he expected financial pressures to encourage further deals.

“Investors want bigger companies, so companies are looking for scale. Larger companies can get their development financed more efficiently,” he said. “There is a general recognition that the industry needs to consolidate.”

BUSINESS DAY

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Opinion THE PUBLIC SPHERE

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

F

ro m Ja n u a r y 1 8 through January 2, the political parties reached the apogee in the ongoing game to confuse the electorate about the nature of their engagement.

They issued threats, statements, and excuses about who is rigging or not rigging, why they would disrespect citizens about a debate whose timeline all parties involved fixed in the last quarter of 2018 and much more. They played on the intelligence of Nigerians.

Reviewing the papers on Tuesday, 22 January 2018, the headlines helped to ad-

A cacophony of coordinated distraction umbrate the charade masquerading as campaigns this season. General Elections 2018 has been the worst case wherein the political parties have failed to tackle any of the core issues that face the nation. None of over 15 issues or more than 42 issues if you go by the number of ministerial portfolios is getting any attention.

As at that weekend, students in public universities had stayed home for more than two months. They entered the New Year not sure when and if they would return to school in 2019.

At issue was the matter of government fulfilling agreements reached with university teachers for themselves and the system. The news was that the National Council of States considered and approved a national plan to provide land and funding for cattle but failed to agree on a plan for education that would end the strikes.

There was more darkness than light as power supply declined, despite claims by government spinmeisters that they had in three and a half years doubled the generation capacity in Nigeria. The power situation has been so

good the minister disavowed responsibility and any relationship with the distribution companies even as the Federal Government holds 41percent shareholding in all the discos.

The headlines this Tuesday featured allegations and counter-claims by the parties and the Federal Government on various issues with none representing progress for citizens. The Federal Government allegedthat the opposi-

‘

On the economic front, the International Monetary Fund sliced Nigeria’s growth projections from 2.3 percent to 2 percent for 2018.

In shaving off 0.3 percentage points, it affirmed the view of global economists that we are not paying attention to the core issues

,

tion parties were mobilising terrorists and the Boko Haram for violence. Information Minister Lai Mohammed led the charge, claiming that the FG has “credible intelligence” on the engagement of “armed bandits and Boko Haram insurgents to engage in massive attacks and other acts of violence in several states across the country”. Names states are Adamawa, Bauchi, Borno, Benue, Kano, Kaduna, Nassarawa, Plateau, Taraba and Zamfara. How could the opposition be mobilising a “technically defeated” Boko Haram? What happened to brain cells in this era?

Both the PDP and the coalition of parties under CUPP dismissed the charge. They rather made fresh allegations of their own to the effect that the government wanted to frame them for arrests while dismissing the claims as “outrageous, laughable and sign of mental disorientation”.

There was continued disputation over the Chief Justice of Nigeria with the government denying yet taking actions to force the holder out of office because of the coming elections. It was the most vivid example of politicising the judiciary for selfish ends.

Other reports featured responses to the Sunday, 20 January detonation of missiles against the Federal Government by former President Olusegun Obasanjo three days to the anniversary of his first salvo on 23 January 2018 against PMB. Then enter INEC with claims that it had uncovered vote-buying plans by politicians. What is this ingenious plan INEC uncovered, you wonder? The politicians would use food vendors at polling centres with a large number of voters as collection points for cash-for-votes. Wow. INEC has joined the intelligence agencies!

On the economic front, the International Monetary Fund sliced Nigeria’s growth projections from 2.3 percent to 2 percent for 2018. In shaving off 0.3 percentage points, it affirmed the view of global economists that we are not paying attention to the core issues.

Rather than outline their plans for the core issues of Nigeria today and tomorrow, the parties and the political elite have all engaged in a cacophony of coordinated distraction. They engage citizens in inanities to take their

minds off the issues of poverty, inflation, lack of jobs and absence of coherent plans and implementation modalities. There is a consensus to dwell on matters to distract through dissembling.

The parties have all drawn from the book of distraction.

It is psychological warfare against the citizenry in the absence of a clear path. Features in that book include fear mongering, character assassination, emotional blackmail, nit-picking criticism and deception. Others include denial, disinformation, distortion.

Niccolo Machiavelli would applaud the application of his principles and precepts in Nigeria. Nigerian politics is one based on any means would do so long as it meets the end goal. It features duplicitous interpersonal relationships, a cynical disregard for morality, a lack of empathy for citizens and the common man and a focus on self-interest and personal gain. They do not care.

In 2019, political communication has focused on a cacophony of coordinated distraction. The oymoron of a coordinated cacophony speaks to the state of Nigeria today. Sad.

As we prepare for landing: Words from the great Lai

IK MUO Ik Muo, PhD. Department of Business administration, OOU, Ago_Iwoye 08033026625, muoigbo@yahoo. com, muo.ik@oouagoiweye. edu.ng

D

avid Mark was not the only one who excluded the common man from the goodies of Nigerian life (Re: telephoneisnotforthepoor!).Another minister had also declared that travelling by air was not for everybody. One day around 1988, I dared that minster, and travelled the Jos to Lagos route by air. Then, it was only Nigeria Airways or Nigerian Airways and I waited at the airport for two days before boardingtheflightforwhichIpaid a whopping sum of N27. Since then, I have not been a frequent flyer, not because I suffer from aerophobia but because if I flew as much as I needed to, I would have been in greater distress than Skye bank of 2018.

Anyway, on the few occasions I have patronized the airlines, I have learnt on getting close to the destination, passengers are always asked to prepare for landing. This is a critical period when passengers are given safety-critical instructions and the cabin crew move around to ensure strict compliance with

these instructions. This changeoriented PMB government, anchored on body language, is now preparing for landing. I have noted some pre-landing comments of the pilot and his co-pilots, and that is what I intend to analyse.

I wish to start from the spokesman of the government, Lai Mohammed who in his 2018 Christmas message to Nigerians declared that ‘we have been able to meet all our promises, all our obligations to Nigerians since we came into power’. Probably he wrote the speech read by PMB at the flag off of his presidential campaign in Uyo a few days later when he boldly declared that we have defeated boko haram and met all our campaign promises.

All his Promises? To Nigerians?

In this Nigeria? Well as Chimamanda Adichie declared during the Achebe controversy, we perceive differently! We are living witnesses to the deluge of promises, which PMB and APC inundated us with in 2015. When the come came to become, they denied all their promises (All Promises Cancelled) but thankfully, retained 3 of them: strengthening the economy, improving security and fighting corruption. To declare bold-facedly that these triune promises have been fulfilled evidences what Lawrence Gemade described as Delusional Leadership, a leadership that believes and orchestrates something, despite total lack of evidence (BusinessDay, 3/12/19) We all see and know how the economy is today. The anaemic growth of 1.8% (despite the promise to make the economy

one of the fastest growing in the world), the frightening level of unemployment, (43% unemployed and underemployed and more job loses likely as manufacturers are increasingly unable to pass on rising costs to consumers) and our ascension to the global throne of poverty.

A president that made a mockery of the subsidy regime, asking ‘who is subsidizing who’ is now neck-deep into the nebulous term of under-recovery and has budgeted $1bn for subsidy in 2019. A government that promised to realign the budget circle presented the 2019 budget on 19/12/18, a budget in which the weight of the pot has surpassed that of the water as we will spend more on debt servicing than on capital expenditure and we are planning to borrow more. And we are regularly told that our foreign reserves are rising but ordinarily, it is a very strange accounting practice to estimate the net worth without discounting corporate indebtedness.

We were promised that Boko Haram would be decimated before 1/9/15. But now, beyond the bloody orgies of BH, we have the bold and fearless herdsmen in the North Central and the bandits in other parts of the north, including Zamfara, which has now become a field of swords(2Sam,2:16) The Zamfara state Governor has declared his readiness to abdicate if that would bring an end to the bloodletting; his Kastina State counterpart reports that his state has been overtaken by armed criminals while the Governor of Borno State la-

mented that the BH attack had increased to a worrisome level.

The Matele massacre and the ease with which Alex Badeh was murdered are testimonies of our security scenario.

The government wants us to believe that war against corruption is fruitfully ongoing but the Nigerian Bureau of Statics has reported that corruption thrives in Nigeria, with reported cases increasing in 15 states, and Abuja as the capital of brazen bribe takers (65%). You know those who hold sway at Abuja.

But here is a story that tells us about the dynamics of the current anti-corruption war: ‘…Videos have been trending online, ‘showing’ Governor Ganduje in the very act of collecting bribes in hard currency… however,

‘

The government wants us to believe that war against corruption is fruitfully ongoing but the Nigerian Bureau of Statics has reported that corruption thrives in Nigeria, with reported cases increasing in 15 states, and Abuja as the capital of brazen bribe takers (65%)

,

the EFCC ICPC and even the presidency have kept mute.

The silence of the EFCC and the presidency is in sharp contrast with the treatment of former Ekiti State governor, Fayose, whose accounts were variously frozen and who was virtually encircled and kept under watch even while still in government.

Rather than investigate Ganduje, the EFCC has been alleged to collect donation of N10m during the national anti-corruption marathon organized in honour of President Buhari. What is more, even the president was videoed in France commending the governor for his many accomplishments in office. Of course, President Buhari will not want to say anything bad about the Kano State governor where he received over 2m votes in 2015 and where the Governor has promised another 5m in 2019’(The curious case of Governor Ganduje, BusinessDay editorial, 20/12/18). There is nothing more to add, except to remind us that the boss of the EFCC has become a permanent acting chairman, holding office in defiance of constitutional requirements. I know that this is not an act of corruption! I also noticed how the president received with gusto, a former PDP National Vice Chair, who has a corruption case dangling on his neck and the grass-cutter in chief at the presidential villa.

That is body language in action.

You see, as I stated earlier, we perceive differently. Lai Mohammed (I don’t know whether he is speaking for the party of for our government or both) has turned

in a self-assessment report of 70%+ (70-100% is the same A!).

However for most ordinary Nigerians (excluding the trader-moni recipients), this government has fed us with bread of tears and gave us tears to drink in great measures (Psalm 80:5).

Furthermore, our people say that whoever examines himself will always pass but the Bible declares that there is better hope for a fool that a man who is wise in his own eyes (Proverbs, 26:12) Other matters OBJ has just done what he is good at: letter-writing. The only difference in this case is that he wrote as Matthew Okikiola Olusegun Obasanjo, PhD, NOUN! I have argued severally that OBJ is a key part of the problems with Nigeria and my writings on OBJ (99% of them are non-commendatory) are more than all that I have written on Yar’Adua, GEJ and PMB combined. My initial reaction to his letters was that he had no moral standing to pontificate.

But I eventually came to accept the message without being enamoured with the messenger. I believe that ignoring his precedents, this latest letter has some weight and its contents should not be treated with levity. It is unfortunate that those who celebrated his earlier letters are those pillorying him for the current letter. That is one of the ironies of life, especially, the Nigerian life, where one can transform from saint to villain or from a friend or a fiend, within an interval of a few minutes. It shall be well with Nigeria and Nigerians!

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