BusinessDay 25 Aug 2020 by BusinessDay

businessday market monitor

Biggest Gainer Unilever N13.95

Everdon Bureau De Change

Bitcoin

NSE Biggest Loser Pesco

7.53pc N51

-3.92 pc

25,229.12

Foreign Reserve $35.6bn Cross Rates GBP-$:1.29 YUANY - 55.77 Commodities Cocoa US$2,449.00

Gold $1,928.58

news you can trust I ** tuesDAY 25 AUGUST 2020 I vol. 19, no 635

₦ 5,584,618.05 -0.24

Crude Oil $44.75

N300

Buy

Sell

$-N 470.00 477.00 £-N 600.00 617.00 €-N 540.00 554.00

www.

FMDQ Close Foreign Exchange

Spot ($/N)

I&E FX Window CBN Official Rate

386.00 381.00

Currency Futures

($/N)

igeria is now a short crawl away from another recession after the latest gross domestic product (GDP) figures released Monday showed Africa’s most populous nation recording negative growth in the second quarter (Q2) of 2020. The Nigerian economy contracted by 6.1 percent in Q2 2020, from a growth of 1.87 percent in the preceding quarter, to record its worst quarterly performance on record, the National Bureau of Statistics (NBS) noted. That is the first negative Continues on page 31

Q2 GDP: The story behind the numbers – Pg 29 & 30

3M 0.00 1.56

12m NGUS jul 28 2021

0.00 1.31

-0.01

10 Y -0.11

30 Y 0.00

6.34

8.65

10.00

36m NGUS jul 26 2023

418.27

491.13

Nigeria now a quarter away from second recession in 4yrs MICHAEL ANI & BUNMI BAILEY

fgn bonds

Treasury bills

Market

Economy reeling from high unemployment, inflation

60m NGUS jul 30 2025 576.68

Ghana’s treatment of Nigerian traders raises red flag ahead AfCFTA … could be retaliation on border closure Odinaka Anudu & Harrison Edeh

he recent closure of shops belonging to Nigerian traders in Ghana highlights major hurdles to cross ahead of the borderless African Continental Free Trade Area (AfCFTA) billed to start January 2021. The Ghanaian Ministry of Trades recently demanded $1 Continues on page 31

Inside Sitting, L-R: Mahuta Babangida Ibrahim, representing House of Representatives; Samuel Agbeluyi, deputy vice president; Barizaage Adoage Norteh, executive chairman, Rivers State Internal Revenue Service; Gladys Olajumoke Simplice, president/chairman of Council, CITN; Adesina Adedayo, vice president; Innocent Ohagwa, honorary treasurer; Adefisayo Awogbade, registrar/CE, and others at CITN Council retreat in Port Harcourt.

CBN moves to forestall overpricing of imported goods with new P. 26 mechanism

Tuesday 25 August 2020

BUSINESS DAY

news

Is Nigeria’s quest for $1.5bn a reminder of the 2016 outcome?

ast week, the Reuters news agency carried very important news on Nigeria’s quest for $1.5 billion from the World Bank. According to the report, the money is being delayed

cycles of the Federal Accounts Allocation Committee (FAAC) for which that was done. However, other sources close to the World Bank suggest that there is also the growing disparity between the parallel exchange

because of the inability of the Federal Government to carry out necessary reforms. It follows a similar and related story by BusinessDay on August 6, about the cancelation of an internal meeting of the World Bank to discuss the matter. While this is a fresh loan for the purpose of budget support this year, it is a clear reminder of the dynamics in 2016 for which the loan and budgetary support sought that year never materialised. As the end of the year approaches, there is no clear indication yet that the World Bank’s board will meet to decide whether to provide the loan that was first sought in Q1 2020, even before the emergence of COVID – 19 in Nigeria. So far, it appears that at least two key windows have been missed and it is now expected that the two remaining windows for the decision are September and October. But missing the September meeting will be most critical to missing the loan altogether. Ahead of the meeting, sources in government say they are not sure what the World Bank wants. As far as they are concerned, they have met all the conditions set out by the Bank, including the changes in the official flows and NAFEX rate, the removal of fuel subsidies, and work on accountability in the National oil company, Nigerian National Petroleum Corporation (NNPC). But even if the government can squeeze further reforms out of itself in order to please the World Bank, it may yet likely not receive the loan if the six months of the country’s International Monetary Fund (IMF) macroeconomic assessment lapses next month without a decision. The World Bank can only use this assessment for its decision within six months; otherwise, a new one will be required. The existing macroeconomic assessment was conducted in April for which the IMF released the $3.4 billion Rapid Financing Instrument (RFI). Few weeks ago, BusinessDay sources had gathered that the sticking points of the discussions and negotiations between the government and the World Bank were on three main points. The first was the requirement for Nigeria’s monetary authorities to monetise foreign fiscal inflows at + - 2% of NAFEX rate and avoid multiple currency practices. According to sources in government, this has been done, and they pointed to two

rate and the NAFEX rate, and the Bank expects the monetary authorities to deal with that as well. The second sticking point was the fuel subsidy. On this point, the jury is still out as oil prices have just started to recover sufficiently to test the government’s nerves on payment of subsidies. This month, average oil prices remain at $44.61, compared to $43.74 in July and $40.27 in June. While it has risen in the last three months, and more than the below $30 average between March and May this year, it has not reached the levels of $63 experienced in January, for which there will be clear subsidies at current pump prices. For instance, at Brent crude price of $42, our calculations show that petrol should be selling for N155 a litre without subsidy. It is selling for N10 less per litre and this creates a subsidy of N10 times estimated 56 million litres (N.56bn subsidy) daily, and this is if dollar rate is at N385. Though unlikely, it is the source of foreign exchange, but if the dollar rate of N470 is used, petrol should be selling for N174 a litre without subsidy, and the level of under recovery will be an estimated subsidy of N1.624 billion daily. The third sticky point was for some measures of blocking leakages in fiscal revenues and accountability. On this point, the government can point to the release of the NNPC’s audited accounts on its refineries, and the continued fight against corruption. And there is also the matter of the expectation of the enthronement of a service reflective electricity tariff. Though the Bank recently approved $750 million, it is yet to be disbursed on the stalling of reflective cost tariffs. In the August 6th story on the matter published by BusinessDay, there was a quote from a senior World Bank official that said, “We are still having discussions with the Federal Government and are working on a comprehensive package support for Nigeria and so we want to be sure everyone is on board.” But what is clear from the developments by shifting the meeting dates for the decision, is that the World Bank is not convinced either by the policy environment, the sustainability of the decisions taken, or the bank itself has shifted the requirements for the loan as time went by.

News Analysis

www.businessday.ng

L-R: Saddiya Umar Farouk, minister of humanitarian service, disaster management and social development; Lai Mohammed, minister of information and culture; Ibrahim Gambari, chief of staff to President Buhari; Edward Kallon, United Nations Resident and Humanitarian Coordinator in Nigeria; Ulla Mueller, resident representative, UNFPA, and Chansa Kapaya, representative, UNHCR, after a meeting of President Buhari with heads of United Nations Agencies in Nigeria, at the Presidential Villa in Abuja,

Rising unemployment, inflation make Nigeria’s optimistic non-oil revenue projection worse Oluwafadekemi Areo

ising unemployment and inflation in Nigeria are fresh hurdles the government, already faced with tepid economic growth, must scale through to meet an ambitious N4.83 trillion non-oil revenue projection for 2020. Nigeria’s inflation rose to a two-year high of 12.82 percent in July from 12.56 percent the month before, while unemployment rose substantially from 23.1 percent to 27.1 percent. Experts are of the opinion that it is unlikely for Africa’s largest economy to meet its non-oil revenue projections

given the real income pressures faced by households and businesses. While government revenue from value added tax (VAT) will suffer from the worsening unemployment and inflation rate, Companies Income Tax will also be badly hit by an economy on the fringes of a recession. “The VAT revenue increased by 8.45 percent from N600.9 billion obtained in half-year 2019 to N651.7 billion in 2020, but I see this increase not substantial because VAT rate was increased by 50 percent from 5 percent to 7.5 percent in 2020,” notes Gbolahan Ologunro, a research analyst at CSL Stockbrokers.

“An 8 percent improvement in generated VAT revenue for a VAT rate that was increased by 50 percent is an indication of weak spending on the part of consumers, and in the face of the global pandemic as well as the rising inflation and unemployment rates in Nigeria, consumer spending might take a further downturn,” Ologunro says. “The same negative trend is expected for Company Income Tax (CIT) as profit in most companies remains under pressure as their revenue is still being affected by rising input cost due to foreign exchange devaluation, existing bottlenecks in the distribution network as well as the hike in PMS,” he states.

Tunde Leye, partner at SBM Intelligence, says Company Income Tax (CIT) and VAT, which make up the bulk of the non-oil revenue type, are closely tied to the level of consumption and economic activities. “The investment and consumption component of the Gross Domestic Product (GDP) function are indicators and consequences of unemployment and inflation, as such, food inflation which is what is currently being experienced in Nigeria means that people are going to be spending more of their income on food, and a reduction in their income will impact VAT rev-

Continues on page 31

Slow reform may worsen COVID-19 induced negative growth in Nigeria’s petroleum sector STEPHEN ONYEKWELU

fter sluggish growth in the first three months of this year, Nigeria’s petroleum industry has crawled into negative growth mode thanks to COVID-19 induced shutdown of world economies, and recovery requires quickened reforms in the sector. In the three months ending June, real growth in the oil sector contracted by 6.63 percent year-on-year, indicating a decrease of 13.80 percent points relative to the rate recorded in the corresponding quarter of 2019, according to the gross domestic report released by the National Bureau of Statistics (NBS) on Monday. Growth decreased by 11.69 percent point when compared with three months ending March 2020, which reported 5.06 percent growth rate. Quarter-on-quarter, the oil sector recorded a negative growth

rate of 10.82 percent in the three months ending June 2020. The sector contributed 8.93 percent to total gross domestic product in the second quarter of 2020, down from figures recorded in the corresponding period of 2019 and the preceding quarter, where it contributed 8.98 percent and 9.50 percent, respectively. A combination of volume restriction by the Organisation of Petroleum Exporting Countries (OPEC) and lower oil prices as economic fallouts from the impact of COVID-19 have meant lower revenues for operators and for Nigeria, in terms of rent. This had the attendant consequence of slower growth in both the oil and gas sector and the gross domestic product during the second quarter of 2020. This has also made the case for urgent economic and export diversification and rapid reform of the oil and gas sector urgent if Africa’s most popu-

https://www.facebook.com/businessdayng

lous country is to become the giant it has the potential to be. To cushion the effects of lower revenues and profits, operators have had to cut down on theircapitalexpenditure.“When you cut down on your capital expenditure, it means you are terminatingcontractsandletting contractors go,” Austin Avuru, formerCEOofSeplatPetroleum plc, said at BusinessDay’s Digital Dialoguestitled‘ANationalConversation: Mapping Nigeria’s Response to COVID-19’ in June. Seplat Petroleum’s experience and response to COVID-19 are typical examples for operators in the sector. In this instance, the company billed to operate four to five rigs drilling about 18 wells. But the company had to cut that down to seven wells, one rig now on contract, meant three to four rigs have been let go. “Each of those rigs will probably have 200 personnel on board. That is the number of staff whose jobs are at risk. The @Businessdayng

entire multiplier effect will be job losses and lower revenues for both the operators and the country,” Avuru summarised. In addition to COVID-19 slowing global demand for oil, Nigeria’s oil and gas sector has been losing foreign investment thanks to a slow reform of the sector. For close to 20 years Africa’s biggest oil producer has been unable to pass the Petroleum Industry Bill (PIB) designed to drive transparency, accountability and competitiveness. The continued delay in achieving this has stunted the sector’s growth and shut out investments. “We do not have six months to wait for the National Assembly to pass the PIB. The bill needs to be passed like yesterday. They have to come back and get to work so that we can get things going,” Bismark Rewane, CEO, Financial Derivatives Company, said on Channel TV’s Business Morning on Monday.

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

NEWS

Here’s how investors can guard against pitfalls in real estate investment CHUKA UROKO

or a successful and sustainable investment in real estate, investors must take into consideration some basic legal, environmental and aesthetic elements as part of ways to guard against investment pitfalls, Periwinkle Residences Limited, a real estate investment and development firm, has advised. Developers are also to consider those elements before engaging in real estate

investment in Lagos State specifically so as to run away from building collapse and fraudulent land speculators. Periwinkle Residences, in a statement titled ‘Do Not Buy a New Home Before Reading This Shocking Free Report’ which BusinessDay obtained at the weekend, explained that, in terms of environment, most parts of Lagos have soft soil such that it is important to have a soil report showing its loadbearing capacity and, depending on the soil type, the foundation has to be either

pile or raft. “Prospective developers and investors should find out if their new home has the required government approvals and other relevant permits. If it does, they need also to ask what the pedigree of the building contractor is as well as the quality of concrete mix intended for use,” Chiedu Nweke, the company’s managing director, advised. Nweke added that a prospective buyer must insist to know what kind of block was used-concrete or sand

mixed, whether the roof profiles used are wood or steel, the type of roofing sheets used as well as the headroom of his new home. The grade and sizes of tiles used for the new home are also pertinent to the aesthetic quality of the new home. To save the environment and control pollution, he stated that a purchaser must know the quality of water and sewage pipes used, the source and pressure of the water supply, what type of sewage collection system was provided, and whether

the drainage system is open or covered, noting also that the Lagos State government has banned the sinking of soak-aways. He advised developers to be conscious of the security requirements of their immediate environments, enjoining them to find out if their new homes are in a gated community or accessible to motorcycles, tricycles, criminals and miscreants. 24-hours power supply and good road access must also be put into consideration before investing.

‘Why we’re opposed to floating Chartered Institute of Securities and Investment’ HOPE MOSES-ASHIKE

inancial Market Dealers Association of Nigeria (FMDA) has kicked against moves by the Chartered Institute of Stockbrokers (CIS) and four other professional bodies to float the Chartered Institute of Securities and Investment of Nigeria (CISI) to control and regulate financial market operations in Nigeria. The FMDA, created to develop financial market infrastructure, human capital and promote professional and ethical standards in treasury activities in Nigeria, distances itself and its members from the sponsors of the CISI Bill, which was created to destabilise the financial market and economy by assigning illegal powers to the CISI. Other institutes said to be involved in the planned floating of the CISI include

Institute of Capital Market Registrars (ICMR), Fund Managers Association of Nigeria (FMAN), Association of Issuing Houses of Nigeria (ASHON) and Association of Investment Advisers and Portfolio Managers (AIPM). FMDA secretary, Mary Gbegbaje, says the CISI Bill seeks to repeal the current Chartered Institute of the Stockbrokers Act and replace it with the Chartered Institute of Securities and Investment (CISI) Act, with the principal objective of determining standards of practice in the securities and investment business. She raised concerns the financial publics have about the intention and purpose of the bill, adding that FMDA will not accede to signing the MoU from the Chartered Institute of Stock Brokers to distort and weaken securities and investment activities in the Nigerian capital market.

Udom seeks petroleum related facilities in A/Ibom ANIEFIOK UDONQUAK, Uyo

overnor Udom Emmanuel of Akwa Ibom State has insisted that Akwa Ibom State sitting on 25 percent of Nigeria’s oil and gas reserve, deserves at least a petroleum depot to strengthen its economy and open up job opportunities for the youths. He also noted that Akwa Ibom was strategically positioned in the Gulf of Guinea, and as such airlines should have no reason going to other West African countries to refuel or service their aircrafts if the Federal Government partners with the state for its rich natural potentials to be effectively utilised. Udom made the observation when the minister of state for petroleum resources, Timipre Sylva led the board of the Nigerian National Petroleum Corporation, (NNPC) to visit him in Uyo, the state capital. He also advocated the unbundling of the oil and gas

secto, saying it would increase job opportunities and rapid growth of the country’s economy. He described the choice of Uyo as significant, explaining that with the developments at the Victor Attah International Airport, the 21-storey smart building, excellent security, good network of roads and other infrastructure, the state has been repositioned for a strategic role as a logistic center of the oil and gas sector. “The new terminal building we are currently constructing, has the most latest technology and intelligence facilities and when completed, will rank the best seen anywhere in West Africa.” Harping on the need for partnership for modular refineries, he noted that “modular refineries or petrochemicals should be totally liberated from whatever could be the bottlenecks to create more job opportunities and stimulate a whole lot of economic activities.” www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

“Does your new neighbourhood have good landscaping? What is the title of your new home or is it a JV arrangement”, he queried, adding that in all of these, the overriding concern to the developer should primarily be the location. He insisted that any developer who knows his onion must be able to know if the location appreciates at price or not to enable him to determine whether he is expecting to make a good Return on Investment (RoI).

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

comment

comment is free

Send 800word comments to comment@businessday.ng

A fresh perspective on the impact of COVID-19 on MSMEs Goke Iyiola

icro, Small and Med i u m Ent e r p r i s e s (MSMEs) constitutes the fulcrum of most nation’s economy, collectively offering the largest pool of employment. MSMEs form the hub of inventions, creativity, innovation, and healthy competition and tend to be nearer to local communities and the grassroots. According to the Ministry of Industry, Trade and Investment, Nigeria has over 37.07 million micro, small and medium-scale enterprises, MSMEs, and they account for more than 84 percent of total jobs in the country. The ministry also claimed that the MSME enterprises in Nigeria account for about 48.5 percent of the gross domestic product, GDP, as well as about 7.27 percent of goods and services exported out of the country. Further to the above, MSMEs are also recognised as veritable instruments of poverty reduction and wealth creation; incubator for developing skilled and semi-skilled manpower, entrepreneurial and managerial capacity; as well as being low capital job creation factory. The critical nature of MSMEs to any economy can therefore not be overemphasised. The COVID-19 pandemic, especially in Nigeria, catalysed a sudden and critical challenge to this sector in such proportions that could be described as constituting an existential threat to the economy. At the onset of the plague, governments ordered the total shut down of all aspect of national life and operations – businesses, government offices, schools … everything, came to a standstill! Trend Total lockdown Nigeria is largely a daily trading economy. For most people, if they cannot go out, there is no income. From the street hawkers to artisans – vulcanizers,

barbers, grocers, commercial transport operators, restaurateurs, laundry and maintenance technicians; services providers – courier/logistics, hospitality, tourism, consultancy … the list is endless. All were grounded at the initial total lock down stage. It was a nightmare for people to feed. There was no reasonable notice of an impending “no movement” that could have prepared the populace. Only a privileged few had reserve stock to feed on. For the majority not so privileged, the nightmare of not being able to go out and earn income, yet no reserve to live on can best be imagined. Talk of double jeopardy. Phased easing out of lock-down This situation lingered for a few weeks before the government began a phased easing of the lock-down. Except for strictly essential services like fuel stations, everywhere, including banks was still put under lock and key. Food markets were however allowed, albeit with strict regulations and limited hours to open. Dusk to dawn curfew was still in place and the rest of the economy remained shut. Interstate lock-down Perhaps, one of the biggest blows to the economy was the total restriction of interstate travel by land or air. Experts are still evaluating the impact and the report may take a few months to emerge. There was a drastic cessation of movement of goods, services and supply lines with the attendant scarcity induced inflation. Impact Many MSMEs were forced to shift from routine operations to crisis management. Stock of perishables and some non-perishables deteriorated under lock and key. There was the headache of not being able to produce/ offer their goods and services in most cases, and at the same time contending with wages and overheads. Many had to lay off good and old hands they invested to train. BusinessDay, a leading national business daily, in a report, suggests 30 percent of MSMEs will not survive the post COVID-19. Working from home Although, there was the attempt at

a new normal of working from home, this was fraught with severe challenges like: cost of data, stability of the internet infrastructure, cost of powering computers and other work devices in the face of unstable power supply. And in any case, some businesses cannot just work from home! Agriculture A sector of critical note is agriculture. We are still saddled with a largely subsistence farming operations which places the sector firmly within the scope of the MSMEs. A lot of farmers could not go to nurture their crop due to the nonoperation of commercial transport occasioned by the sit-at-home order. They also could not go out to get their regular farming inputs like fertilizers, pesticide etc. How this will impact on food security is yet to be seen. Other losers Several other high employing sectors which MSMEs offers support services to, were also deeply affected among which are: construction, entertainment, promotional products, commercial transport, travel, leisure and banking. Gainers Repair and maintenance technicians All is not doom and gloom though especially from the gradual ease of lock-down. Among the main gainers are the repair and maintenance technicians – Powergenerating sets, refrigeration systems, plumbers etc. Their businesses have been largely unaffected. On the contrary, families’, spending more time at home, has put more pressure on home and household appliances, increasing the demand for repairs and maintenance services. E-commerce community and its platforms Another major gainer during this pandemic is the e-commerce community. Given the demand for social distancing and restricted movement, a lot of transactions have gone online. It is now not unusual to shop, even for meals and grocery online. Movies, entertainment, and gaming online is at an all-time high with the attendant windfall for Information Technology and Financial

‘

MSMEs are clearly in dire straits, and now comprehensively compounded by the ravaging COVID-19. The little gains of the past appear to be ebbing while the enormous journey ahead remains daunting

Note: the rest of this article continues in the online edition of Business Day @ https://businessday.ng Iyiola is COO, 7Edge LLC

The NBC as a stumbling block

recently heard a presenter sign off on a programme on a radio station in Lagos metropolis with the phrase, “mind your damn business.” Damn? Damn. As a former broadcast administrator, I sighed it off as a failure of supervision at that station and monitoring by the regulator, the National Broadcasting Commission (NBC). Monitoring the airwaves has always been a challenge for the Commission. It has an enormous work of monitoring a plethora of TV and radio stations cutting across public, private and community broadcasting in Nigeria. Public broadcasters at the federal and state levels constitute a large chunk. It is safe to say that, going by the many damning lapses and infringements on the airwaves, the Commission must be struggling in this aspect of its 14 statutory functions. The Commission has shifted the dates for the launch of the Digital Switch Over more times that one can count. How then does the NBC want to regulate the internet as it recently announced? It is unclear how the NBC intends to assess the multitude of social media accounts, and evaluate their use of language, music, percentage of local content, knowledge, to mention a few of what it would be looking out for. The NBC like some other agencies under the Federal Ministry of Information and Culture suffers interference from, and lacks

independence from the supervising ministry; by extension the government. Des Friedman in “The Politics of Media Policy” provides a critical perspective on the dynamics of media policy in the US and UK and exposes the fact that although many policymakers boast of the openness and pluralism of their media systems, the reverse is the case: they often please the principals not the masses. I agree with many who say that this new policy is a deliberate attempt to frustrate digital inclusion and diversity. And I want to wear my woman cap here. Edison Research and Triton Digital statistics in its 2019 Annual Social Media Study showed that women constitute the largest users of Facebook, Instagram, Twitter and Pinterest. They use social media to sell their businesses and services to their friends and family. NBC’s latest move would essentially destroy the access to these gender-friendly platforms for women, stifle creativity, content creation and distribution, and press freedom. It is antipeople, inimical to the growth of the creative industry, and catastrophic for young creatives who have found outlets on the internet for their creative ideas. This policy undermines the contributions of an army of young Nigerians who have turned to the internet to actualise their dreams in broadcasting. These Nigerians, whether new entrants in the media or professionals who have years of

www.businessday.ng

practice under their belts, have turned to social media platforms like ants to showcase their talents and distribute their work. They are creating and distributing content which are getting noticed by the masses and specialised sectors. This recognition is bringing social, cultural, material and financial capital to thousands. Didn’t the Government say it wants more Nigerians to be meaningfully engaged? Those who lack the financial wherewithal to place programmes on traditional radio and TV are falling back on mobile devices to share their productions. We have seen sheer ingenuity since the Covid-19- inspired lockdown in Nigeria. But for the activities of citizens on social media, many would not have survived the pandemic thus far. Even traditional radio and television stations are benefitting from internet-based broadcast activities because they are experiencing more engagements. The National Broadcasting Commission, or any other agency of Government, should not constitute a stumbling block to genuine efforts to make legitimate money and outlets for creativity. What smart media organisations have done is to consolidate their visibility online through mobile devices to compete favourably with citizens churning out content there. The NBC cannot stop the innovative use of the internet by citizens who download an app on their mobile devices and are maximising its use.

https://www.facebook.com/businessdayng

Technology platforms. Delivery/courier services Various service businesses are also cashing out, primary of which is the delivery/courier/logistics sector. Their motorcycles and minibuses can be seen doting the streets of Lagos and other major cities of Nigeria making deliveries. Digital marketing The digital marketing industry is equally enjoying more patronage as many business owners are forced review their market engagement strategy since it has become imperative to expand from their traditional market to a wider national and global target market. Advertising The battle against COVID-19 was prosecuted largely on two fronts. First is the practice of social distancing and public hygiene, which was vigorously promoted on every possible media locally and globally for public enlightenment. Traditional and online media recorded a sharp increase in advertising revenue from government, non-governmental agencies and other entities that drove an aggressive and relentless campaign. Health care products & pharmaceuticals The other was preventive and when necessary diagnostic and therapeutic healthcare practice. The use of surgical facemasks, hand sanitizers, disinfectants and the likes became not just required but mandatory by official directives. In the absence of an acceptable vaccine, the suggestions that certain drugs like: hydroxychloroquine, azithromycin, Zinc sulphate and vitamin C were useful in treating COVID-19 patients; resulted in a massive boom for pharmacies and health care products manufacturers and retailers. Prices of such items and drugs skyrocketed between 100 – 1000 percent, yet they ran out of stock daily from the barrage of the horde of anxious buyers.

Anike-ade Funke Treasure

Advice for NBC The NBC should rather get ready for the digital future and align itself with the new normal. It should re-engineer itself by re-inventing its duties in the broadcast industry to reflect the realities and demands of this digital age. It should re-direct its efforts at ensuring quality content and sanity on Nigerian airwaves. It should invest in skilled manpower and state-of-the art equipment to effectively monitor. It should mandate local broadcasters to produce relatable and competing content with the offerings on cable TV stations operating in the country. It should save the nation the embarrassment of tuning to cable TV operators to enjoy clear signals from our terrestrial TV and popular radio stations as well as compelling programmes with national cult followership. It should indigenise and contextualise policies copied from abroad to reflect our peculiar challenges. Responsible and responsive media governance starts from here for both NBC as a regulator and its supervising ministry. Or, we are all damned. Anike-Ade Funke Treasure, a media consultant and media text analyst runs a social enterprise in Lagos

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

comment

comment is free

Send 800word comments to comment@businessday.ng

Ngozi Okonjo-Iweala: Eminently qualified for DG WTO

An able and willing reformer to make WTO thrive in the 21st Century STRATEGY & POLICY

MA JOHNSON

he World Trade Organisation (WTO), born out of the General Agreement on Tariffs and Trade (GATT), was established on 1 January 1995. The main objective of the WTO is to ensure trade flows smoothly and predictably globally. As it stands today, the WTO is the largest organisation in charge of international trade and finance with its headquarters in Switzerland. Since the WTO was established, it has not been headed by an African. Today, the WTO is headed by a Brazilian, Roberto Azevedo who is completing his tenured term in office soon. Once the incumbent Director General (DG) completes his term in office, a new DG would be elected to succeed him. Since the race for the position of the DG WTO began, different nations had projected their citizens to take charge of the international trade organisation. The DG WTO wields so much power and influence just like the chief executive officer of any other international organisation such as the United Nation (UN), World Bank, and International Monetary Fund (IMF) amongst others. Member nations are qualified to compete for the top job at the WTO. So eligible candidates are given ample opportunity to compete for the position of DG by going through appropriate laid down rules and procedures. The list of applicants includes

3 African contenders for the plum job. They are Ngozi Okonjo-Iweala, Nigeria’s former Finance Minister and head of Economic Management Team and ex-foreign minister; Amina Mohammed, a Kenyan lawyer, diplomat and politician; and Abdel-Hamid Mamdouhm, an Egyptian lawyer and ex-WTO official. Sentiments apart, above listed Africans who have shown interest in the WTO’s plum job have intimidating profiles and none of them can be pushed aside. A flip through Amina Mohammed’s profile for instance, shows that she has gone through the Mamdouh mill as a former staff and chairperson of many committees in the WTO. Frankly, she is going to slug it out with Ngozi Okonjo-Iweala before competing with other eminently qualified candidates from other parts of the world. I can see power of nations and diplomacy at play in selecting the next DG WTO. Affirmative, global geopolitics will play a significant role in the selection process as developed countries are interested in the DG WTO position. There are speculations that developed countries want to have access to the office of the DG WTO in order to further boost their trade activities. This is happening at a time when COVID-19 pandemic has changed the face of global economy. Although, African countries have a potential to do more, its contribution to global trade remains marginal at about 2.6 percent, up from 2.4 percent in 2017. And while intra-African trade rose to 16 percent in 2018 from 5 percent in 1980, it remains low compared to inter-regional trade in Europe and Asia, according to African Trade Report 2019. With Africa constituting about 27 percent of the total WTO membership and 35 percent of WTO developing countries membership, the continent of over one billion people has a key role to play in global trade. Trade will improve economies globally. Considering Africa’s weak contribution to global trade, one is tempted to argue

in favour of an eminently qualified African to head the WTO. But I do know that selection process for any plum job in the international environment doesn’t follow a straight-line graph. For instance, one may wish to recall that some of the industrialised nations such as the US, Japan and others including countries in the European Union (EU) have raised concerns about WTO’s rules on “special and differential treatment” which creates favourable trade terms for Less Developed Countries (LDCs). The concern raised by some industrialised nations may be a stumbling block against the emergence of a DG WTO of African descent. But if you ask me, I think the international community in general and industrialised nations in particular, are desirous of revamping the mechanism of the WTO with a view to ensuring participation of more countries in global trade. If my thoughts are in sync with realities on ground, it may be necessary to bring on board an African bureaucrat and technocrat with leadership abilities who understands how trade works in the international environment. All these odds aside, when one examines the profiles of the abovenamed distinguished personalities of African descent, it is observed that Nigeria’s Ngozi Okonjo-Iweala is the most suitable and qualified candidate to be the next DG WTO. Please, permit me to tell you why Ngozi is eminently qualified for the plum job. Ngozi Okonjo-Iweala is a woman of grace and candour with an intimidating profile. She is Chair at the Board of Gavi, the Global Alliance for Vaccines and Immunisation. Ngozi is also Senior Adviser at Lazard, one of the world’s premier financial advisory and asset management firms. An economist and a reformer who understands the language of multilateral agreements at international level having served at the World Bank as a development economist for 25 years where she rose to the enviable position of the Managing Director.

‘

Africa has not benefitted considerably from global trade. So, with diplomacy and game of brinkmanship by the Nigerian government, Ngozi will have an opportunity again on the global stage to prove that she can make the WTO thrive in the 21st Century

With the trade war between the US and China and the weak performance of African nations in global trade, contrasting trade policies among member nations, emergence of AfCFTA, and low-level activities of the WTO, I submit that the crown will certainly fit Ngozi Okonjo-Iweala of Nigeria as the next DG WTO. A beacon of hope for other African women, Ngozi is a distinguished graduate of both Harvard University and the Massachusetts Institute of Technology (MIT), a multi-awardwinning finance expert, development economist, a global civil servant and reformer. Ngozi is a woman of integrity, experience and honour as demonstrated twice when she was Nigeria’s Minister of Finance. After fighting corruption as finance minister, Ngozi left Nigeria’s murky political terrain gracefully with her honour and integrity intact on completion of her tour of duty. I salute Ngozi’s courage. I hope the way Nigeria is perceived within the international community will not count significantly against Ngozi’s efforts at securing the top job. I want to believe that Nigeria is up-todate in its financial obligations to the WTO. I do hope that Nigeria’s corrupt history of financial mismanagement by some individuals in authority coupled with rising spate of insecurity will not mar Ngozi’s chances of emerging as the next DG WTO. Africa has not benefitted considerably from global trade. So, with diplomacy and game of brinkmanship by the Nigerian government, Ngozi will have an opportunity again on the global stage to prove that she can make the WTO thrive in the 21st Century. It will take an African, particularly a Nigerian of Ngozi’s calibre and leadership quality to reform the WTO, support weak economies, and moderate established procedures of world’s power brokers on global trade issues. Thank you! Johnson is an author and a retired naval engineer who has passion for African development and good governance

The attitudinal behaviors of the National Agricultural Seed Council of Nigeria

he methods being used in the constificated, forcefully attacking of the different Agricultural inputs distributors, marketers, sellers being noted for several reasons such as the expire dates, low quality of seedlings, , adulterated in some selling points within offices , inside and outside the markets, call for serious attention’s and while we can say that they are trying to help the poor farmers, for them to get a good inputs , yields, increase farm productivity in the agricultural sectors, so that there will be no any adulterers one in the markets and they can be sure of what they are buying at the end of the day and in life time of cause. But there are ways of doing things, best international practices from the developed Countries. Well I may stand to be corrected. Firstly they need to give a soft hand in taking a quick actions, find out how comes, building of the capacity of the farmers in keeping of seedlings, buying and they also have to meet with the buyers, sellers, manufactures and farmers to discuss further on how to go about this and also discuss with the suppliers, producers, call for the Agricultural stakeholders meetings and the various marketers and

building of the sellers capacity, will also be a life plus , warning and making sure that they are not selling adulterated seedlings, but good inputs and sanction them, frequently, retraining of the farmers on purchasing of farming inputs, , best method of buying. effective collaboration’s, discussions with all the States Agricultural Development Programs. This is a piece of advices, so that the sellers, farmers, importers and the buyers will not be being affected. because there are a lot of value chains and actors in Agricultural inputs, such as the manufactures producers, sellers, farmers across the country. Establishments of farms schools and food educational programs The needs for the present Government to encourage and develop a lot of food educational programs, encourage and the development of Agriculture and land cultivations in the most of the higher learning and this will be helpfully in creating special interest in the farming activities. The best way to go about this is to encourage the cultivations of land, where by each students will have a plot of land being allocated and for him to develop, cultivates, manage, harvests sales and given www.businessday.ng

several input and monitoring their various activities and various schools can also establish and develop more hectares of farms for profits making and the diversifications of incomes and revenue generations for the schools and it will also been used in the practically, food and land cultivation, farm demonstrations, farm technology transfers and school farming businesses, that will ensure profitability and educationally teachings and adding values, with different practically nutritionally development, farm businesses and employment generations in the societies at large. Supporting, education, child development and food security The urgent needs to look at the different curriculum of the higher Institutions that will support child development, enhance food security, resilient and new methods of dissemination of educationally programs with the latest technology that will also boast education and food value. Concentrations on the need fully of areas of the nutritional packages systems and values, that will build up the capacity of the average children and increase the different learning procedures and ensure the profitability. While the thoughts

https://www.facebook.com/businessdayng

Michael Adedotun Oke

of the ways forward of developing and food nutritional management and which will help in the development of the faculty and the enablement of the differently students will be a life plus in generally. Child nutrition’s programs is needed and very important The Children needs more friendly Nutritional intake, that will enable them to develop, improving children health’s academics. life performance, learning capacity, eradicates childhood hunger, think well and work through life, the important is also noted in growth and development and helps in the educational ways and enhance learning in all ramifications of life. This can only happen if there are different nutritional packages, projects, supporting school food feeding systems and programs.

@Businessdayng

BUSINESS DAY

Tuesday 25 August 2020

comment

comment is free

Send 800word comments to comment@businessday.ng

Nigerian banks – Navigating choppy & oily waters

Rafiq Raji

n early May, the Nigerian government relaxed a hitherto fiveweek lockdown of the two main cities of the country, Lagos and Abuja, with activity in most parts of the country similarly constrained. The justifiable stringency was in order to limit the spread of the coronavirus, which has killed hundreds of thousands around the world. A downside, however, has been the economy. Because even as banks were allowed to operate as essential service providers during the lockdown period, many opted to shut their doors entirely, limiting their services to online channels and the automated teller machines (ATMs) at their branches. Evidence that these did not suffice for their customers’ needs emerged on the first week day of the eased measures. Queues were seen at bank branches with little regard for advised health safety guidelines of physical distancing and wearing of face masks. Other than the health concerns, the deluge was not particularly a matter for great concern. No, people were not rushing to get their money out of their bank accounts to hide somewhere else. And no, there is no Nigerian bank suffering any form of reduced confidence. However, the seeming normalcy masks the probable headaches of the various managements of the country’s almost two dozen banks. Diminished livelihoods & low oil prices to weigh on banks Amidst their laudable donations of billions of naira to the government’s pandemic-curbing efforts, Nigeria banks have also been coming to terms with the mounting losses in their loan books. As many of their borrowers were unable to conduct their businesses during the lockdown period, many failed on their obligations. And even as curbs are now being eased, many firms and

individuals may remain inhibited for a little while. The pandemic is only one part of the problem for Nigerian banks. A bearish turn in the international crude oil market is another. While primarily, the direct effects of these circumstances were mostly on the Nigerian government’s revenue, since crude oil is the source of almost all of its hard currency earnings, Nigerian banks, which altogether made about a quarter of their loans to firms in the oil and gas sector, have been similarly hit. According to Moody’s, a rating agency, about 41 percent of bank loans are denominated in foreign currency and extended to customers which earn in naira, the local currency. Although about 25 percent of total deposits are in hard currency, this would hardly be a source of comfort. Economic and policy uncertainties owing to the aforementioned headwinds tend to instigate a flight to safety. There is usually not only a rush to store value in hard currency but also to move the deposits to venues where they cannot be easily appropriated by governments. Banks are also complicit in this regard. Reports have emerged that some banks have been hedging their bets unscrupulously by playing outside of the official foreign exchange market, drawing the ire of central bank governor Godwin Emefiele, who warned them to cease and desist. But with a 15 percent devaluation of the naira to 360 units of the local currency to an American dollar in March, from 306 over the past two years hitherto, and a series of further weakening of the naira later in the year suggested by the futures and black markets, the governor’s warnings may fall on deaf ears. Moody’s estimates about $12.5-$15 billion of government paper are held by foreigners. Against a backdrop of a little over twice that amount in FX reserves, with foreign portfolio investors looking to return their money home, there might be hard times ahead. Thus, it is not improbable that capital controls and restrictive foreign exchange measures might be implemented by the central bank. All these do not bode well for Nigeria’s deposit money banks. The clouds are not entirely dark. Output cuts by OPEC+ oil producers have begun to push up prices. With

demand recovering, as China and other economies ease lockdowns and economic activity pick up, there is a high probability that the momentum would be sustained. And almost counterintuitively, deposits of big banks are rising, up by about a quarter in late May, according to BusinessDay, a respected local newspaper. But it is abundantly clear that there would almost certainly be recessions all around, as negative outputs for the second and third quarters in almost all of the world’s economies are all but certain. Estimates of the diminution in 2020 GDP for Nigeria range from 3-8 percent. But a good first quarter, with economic growth of about 2 percent, has calmed nerves a little bit, ahead of what are almost certainly two consecutive negative quarters thereafter. While the extent of the damage on Nigerian banks from the current challenges are yet to be determined, the reckoning is that things have not totally gone awry just yet. Besides, some of their hard currency and oil bets are hedged, albeit still at levels that suggest they would likely take on some losses. Still, it would not be out of place to reckon that some banks would be casaulties of the current crisis. Bigger banks are rightly thought to be well-heeled to weather the storm, though. Smaller banks, not so much. Negative medium-term outlook Peter Mushangwe of Moody’s, which changed its outlook on the Nigerian banking sector to negative in late April, gives a good synopsis of the current state of things. “In Nigeria, banks will face weakening loan quality and foreign currency liquidity as low oil prices and the pandemic weigh on the economy. These new challenges add to existing headwinds from slow economic growth and rising regulatory costs. Banks’ exposure to the oil and gas industry is substantial, at around 27 percent of total loans at the end of 2019, making the system susceptible to the oil price slump. The banking system is also highly dollarised, putting pressure on both assets and liabilities in the event of a naira devaluation. Nigeria’s largest banks, however, will continue to benefit from high government support.” Rating agencies Fitch and GCR, which also have negative outlooks on the Nigerian banking industry for much of the same

‘

Ideally, the current state of things should spur consolidation in the industry. But would that be the case this time around? Moody’s Mushangwe reckons this would depend on how long the pandemic and low oil prices last. The longer the crisis, the more banks would erode their capital buffers and liquidity, Mushangwe adds

reasons, agree by and large, with this overview. So, what do these challenges portend for Nigerian banks over the short to medium-term? Yinka Olowofela, senior analyst at GCR Ratings in Lagos, expects non-performing loans (NPLs) to rise to at least 9 percent in 2020 from 6 percent last year, with expectations of further deterioration the longer the pandemic lasts. Moody’s Mushangwe already expects NPLs to more than double to over 12 percent, with profitability tanking in tow to lower than 1 percent of assets from 2.5 percent in 2019. On his part, Mahin Dissanayake, senior director of banks for Africa and the Middle East at Fitch Ratings, expects asset quality to deteriorate over the next twelve months, owing largely to banks’ exposure to the oil and gas sector. Fitch’s Dissanayake also sees similar risks for sectors hit by social containment measures like manufacturing and trade. Understandably, he finds it difficult to predict how bad things could get or provide a forecast of impaired loan ratios for the year (see interview for more details). Ideally, the current state of things should spur consolidation in the industry. But would that be the case this time around? Moody’s Mushangwe reckons this would depend on how long the pandemic and low oil prices last. The longer the crisis, the more banks would erode their capital buffers and liquidity, Mushangwe adds. Still, while GCR’s Olowofela would not rule out mergers and acquisitions in the industry on these challenges, his interactions with banks suggest most would be able to raise additional capital to shore up their capital bases. Besides, Fitch’s Dissanayake draws attention to how much fewer banks there are now than during the last systemic crisis. “Banks will only merge or be acquired these days only if they are facing significant problems”, Dissanayake adds, stressing “it would not be a commercial decision to merge or be acquired.” An edited version was first published in the Q3-2020 issue of African Banker magazine “Dr Raji is chief economist at Macroafricaintel. He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @ DrRafiqRaji)”

Nigeria’s maternal health crisis calls for good journalism, but we need better tools

aternal mortality is one of Nigeria’s most persistent health issues. It is not news that Nigeria has consistently ranked among the countries with the highest number of maternal deaths. In 2017, the World Health Organization estimated that Nigeria contributes 12 percent of global maternal deaths. Government administrations have responded with new programmes backed by international donor funding amounting to millions of dollars, and even community organizations have banded together introducing programmes of their own to get Nigeria’s maternal health crisis under control. Some of these programmes, like Ondo State’s Abiye and the Midwives Service Scheme have been outstanding. For most other programmes the situation is different. When launched, they are reported about but very little can be found about their impact months after. Did they work? How was the money spent? Which women or communities were affected? We need more solution stories. It must be said that this is not a failure of journalism. Journalists have been known to uncover the dangerous effects of international business deals in local communities or lay bare the sexual harassment that is rampant in West

African higher institutions. The lack of follow up about how Nigeria is working to reduce its maternal mortality is an issue of access and accountability. Lack of access to accurate data showing Nigeria’s maternal mortality is a well-known issue. International agencies have given varying accounts about where Nigeria stands. WHO has published three different estimates for the country’s maternal mortality ratio over the last five years, all of which give different figures for the same time frame. Political leaders have openly questioned these numbers and others developed by international bodies calling them “wild estimates.” But the National Demographic Health Survey doesn’t offer any more clarity. Published every five years, the survey reports have only released maternal mortality ratios in three editions. If we look closely at the data from these surveys, it would show that the reduction in Nigeria’s maternal mortality ratio has not met the country’s own expectations. In ten years, Nigeria and a host of other countries will be evaluated by whether they were able to achieve a set of goals to ensure a better future for their citizens. Achieving a maternal mortality ratio less than 140 maternal deaths per 100,000 live births is a big-ticket item

www.businessday.ng

of the third Sustainable Development Goal. If we’re going by the estimated maternal mortality ratio in the 2018 National Demographic Health Survey, Nigeria has ten years to reduce its maternal mortality ratio by more than 70 percent. The best way to conclude whether or not this will be possible is to look at Nigeria’s track record so far. This is why we built Maternal Figures; a database of maternal health interventions implemented in Nigeria over the past 30 years. We wanted to put together a resource that would help journalists, researchers, and other stakeholders answer the question of how well interventions are working and what is the evidence available. For the last year, we surveyed dozens of donor agencies, federal and state budgets, and non-profit reports following the money allocated to these programmes. We’ve charted maternal health policy and legislation over the last 30 years, including a policy that approved the use of a life-saving drug to treat postpartum hemorrhaging. And have collected close to 500 source documents: reports, evaluations, research, and interviews relating to these interventions. These are now available on our website. As a result, we’re able to provide insights into who the largest funders are or what regions of

https://www.facebook.com/businessdayng

Ashley Okwuosa and Chuma Asuzu

the country receive the most or least amount of funding according to our research. Maternal Figures does not claim to be an exhaustive look at maternal health in Nigeria, but it is a start. In the right hands, Maternal Figures will encourage better record keeping of how Nigeria aims to meet global and national goals to keep pregnant women safe during childbirth. In a journalist’s hands, Maternal Figures is a research tool to find stories on how well Nigeria is doing to end the maternal health crisis. It is a guide to asking the right questions, interviewing the right people, and seeing the reports first hand. With more stories, we build more awareness and hopefully we end this crisis once and for all. Okwuosa and Asuzu are the researchers behind Maternal Figures, a database of maternal health interventions implemented in Nigeria over the last 30 years. To learn more about their work and access the database, visit maternalfigures.com.

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

EDITORIAL Publisher/Editor-in-chief

Frank Aigbogun

With the economy in ruins, business-killing regulations should go FG wake up! The country you pretend to govern is imploding right before your eyes

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

Bashir Ibrahim Hassan

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

he Nigerian economy has seen five years of negative per capita growth, shed millions of jobs and about half of the population now live in abject poverty. We must, as a matter of urgency rethink how businesses are regulated and hire sound people to plan this dying economy. Poor regulation is now the most dangerous threat to businesses in Nigeria. Foreign Direct Investment (FDI) into the country now hovers around a paltry $1 billion yearly trailing smaller peers like Ghana. The Manufacturers Association of Nigeria (MAN) said about 272 firms were forced out of business in 2016. Our regulations are dangerous because they are not responsive to changes in the economic, social and technical conditions surrounding them. In developed countries, regulations follow developed markets and act as powerful stimulus to further innovation. Our regulations shrink markets, deter investments and get in the way of innovation and growth. For example, renewal of oil leases and organising licensing rounds are routine processes in other countries except Nigeria. Various government agencies and state governments enact overlapping and frankly dubious rules for operators. Oil companies suffer multiple and disjointed regulations which raises costs, creates ambiguity, distorts project timelines, stifles investments and fosters ineffi-

ciency. For the past ten years, we cannot pass the PIB meanwhile our neighbours now have oil and big oil companies are spoilt for choice. Access to land, foreign exchange, electricity, port operation suffers needless complications because of meddlesome regulations. With the exception of a negligible few, the various governments in Nigeria have shown crass incompetence at enacting sensible policies that will drive the economy. The worst culprit is the federal government whose inept economic policies have provided the blueprint upon which various profligate state governments build poor economic plans. Forward thinking governments have done away with price controls and sternly regulated markets. Even closed China opened its markets but we are doubling down. In 2020, we are still arguing about petrol subsidies and electricity tariffs. These days, governments are allowing for collaborative regulations with businesses, courting private capital and allowing entrepreneurs to give input in economic policies. The United States under President Donald Trump has seen tremendous economic growth due in part to deregulation and competitive tax policies that allowed businesses to thrive. The rhetoric about protecting Nigerians from exploitation which provides justification for aberrant policies has done too great a damage. If anything, it is their ruinous governments Nigerians need protection from. Imagine if electricity tariffs were allowed to follow

the rules created under the Multi Year Tariff Order which prescribed biannual tariff review, by now the market would have stabilised. Instead, the federal government interfered, prevented a tariff increase and has burnt over N1.7 trillion on subsidies. Yet, output remains at 3,500MW for over a decade, consumers still pay more because they depend on generators and the sector is messed up. The lesson various governments need to learn is that businesses have to thrive to help the government generate the required revenue to protect consumers. Now more businesses are leaving the country due to the asphyxiating business environment. Shoprite Retail Ltd, is leaving as well as others. We need to stop trumpeting the lunacy that we are a strong economy simply because there are supposedly over 200 million of us. Too many poor people have little economic value. This is why Shoprite is more profitable in a country with over 50 million people than with over 200 million. Nigeria’s Motor Vehicles Sales report recorded 9,800 units in December 2019, compared with 17,000 units in the previous year while sales in South Africa last year was over 300,000. is it any wonder that every consumer good is now sold in sachet? We are getting poorer! The federal government has to lead the way in creating smarter regulations. Its officials should update their knowledge and eschew pedestrian considerations in regulating businesses, allocating resources, planning the economy

or building infrastructure. Much noise has been made about this government’s rail infrastructure but what the country really needs are freight trains that connect industries, farms to major cities to cut post-harvest losses and bring goods quickly to market. Failure to dredge ports in other parts of the country is burying Lagos in a quicksand of chaos. State governments need to stop emasculating businesses through ridiculous taxes and rein in their rascally officials who waylay businesses in local government areas. They charge ridiculous fees to lay fibre optic cables, erect masts or open shops. Unimaginative governors and local government officials keep their states poorer through a hostile business environment that forces out businesses and wonder why their young people are hawking soft-drinks in Lagos traffic. Formalise businesses, provide them a conducive environment, help them thrive, then tax them. If the civil service is the biggest employer in your state, you are a failure as a governor! The days of plenty are gone. Crude oil sales accounted for 40 percent of the federal government’s revenue in 2019. It used to be 70 percent. Our debts to China are getting dangerously close to where they can auction the country. We can no longer afford the brigandage at the NDDC or the circus going on at the EFCC. The national assembly should wake up and smell the coffee, the country you all pretend to govern is imploding right before your eyes!

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

Enquiries NEWS ROOM 08169609331 08116759816 08033160837

} Lagos Abuja

ADVERTISING 01-2799110 08033225506 SUBSCRIPTIONS 01-2799101 07032496069 07054563299 DIGITAL SERVICES 08026011296 www.businessday.ng The Brook, 6 Point Road, GRA, Apapa, Lagos, Nigeria. 01-2799100 Legal Advisers The Law Union

Mission Statement To be a diversified provider of superior business, financial and management intelligence across platforms accessible to our customers anywhere in the world.

OUR Core Values

BusinessDay avidly thrives on the mainstay of our core values of being The Fourth Estate, Credible, Independent, Entrepreneurial and Purpose-Driven. • The Fourth Estate: We take pride in being guarantors of liberal economic thought • Credible: We believe in the principle of being objective, fair and fact-based • Independent: Our quest for liberal economic thought means that we are independent of private and public interests. • Entrepreneurial: We constantly search for new opportunities, maintaining the highest ethical standards in all we do • Purpose-Driven: We are committed to assembling a team of highly talented and motivated people that share our vision, while treating them with respect and fairness. www.businessday.ng

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

COMPANIES&MARKETS Siemens restates support for sustainable development with ‘Business to Society’ initiative IFEOMA OKEKE

iemens Nigeria has restated its commitment to supporting sustainable development in Nigeria through its Business to Society, (B2S) initiative. Siemens says it’s support for sustainable development in Nigeria is driven by their widely acclaimed model Business to Society initiative which is focused on achieving societal, economic and environmental advancements in the following areas: economic development, environmental sustainability, developing local jobs and skills, providing value-adding innovation, improving quality of life and positive societal transformation. Defining the Siemens “Business to Society” model, Onyeche Tifase, CEO, Siemens Nigeria, said, “Our ‘Business to Society’ initiative represents the multidimensional ways we approach creating real value

in the lives of Nigerians and Nigerian communities. “At Siemens, we appreciate how critical it is for businesses to impact on their stakeholders and society in a positive and sustainable manner. We are proud of our heritage and business in Nigeria, but beyond profits, we measure our success in the broader context of the significant value we have added over the last 50 years” she affirmed. Since 1970, Siemens’ technology, products and services have contributed to driving the Nigerian economy. According to the latest Business to society (B2S) report prepared by Pricewaterhouse Coopers (PwC), in 2019 alone, Siemens contributed a total of $562.5mn in Gross Value add (directly and indirectly) to Nigeria’s GDP through constructive engagement with industries especially in the Oil & Gas, Manufacturing and utilities sectors. The B2S report also reveals that Siemens technology has

contributed nine percent to Nigeria’s operational power generation installed capacity. Furthermore, the widely acclaimed partnership agreement between Siemens and the Federal Government for the Presidential Power Initiative (PPI) is set to upgrade the electricity grid network and increase operational capacity from 4,500 MW on an average currently, to 25,000 megawatts (MW). According to Tifase “This is a demonstration of our commitment at Siemens to make significant investments in providing value-adding initiatives to address challenges in Nigeria’s power sector”. Siemens Nigeria remains a strong partner to the Nigerian government in developing local jobs and skills. The company has positively impacted employment with an estimated number of 48,000 jobs linked to Siemens’ business operations in Nigeria. Furthermore, as part of their commitment to shap-

ing societal transformation, Siemens is taking a leading role in supporting the government’s commitment to fight corruption and improve transparency in the public and private sector. The B2S report stated that Siemens Integrity Initiative (SII) has invested about $1.29mn in Nigeria to promote anti-corruption practices through capacity building and training. Tifase says, “Our social investment programmes have been designed to achieve the highest levels of stakeholder resonance and maximal benefits to the society”. In addition to these initiatives, Siemens is ideally positioned to meet their goals of improving the quality of life for Nigerians and ensuring environmental sustainability through their partnerships and active participation in initiatives that will provide access to quality healthcare for up to 100,000 Nigerians and achieve a net-zero carbon footprint by 2030.

Access Bank rewards bank customer with a brand new Hyundai Accent CYNTHIA EGBOBOH, Abuja

ahiru Umar, a Kaduna-based trader has emerged the grand-prize winner of the Access Bank, Transact and Win a Car promo. Umar won a brand new Hyundai Accent, which was presented to him in Abuja at a brief Ceremony at the Bank’s Abuja/North West Regional Office, in the nation’s capital. Access Bank Transact and win promo is designed to reward customers for using its digital channels, including the USSD-*901# and mobile appsAccessMore, old Access Bank mobile app and Old Diamond Bank mobile app. According to the bank, the requirement to qualify for the promo is a minimum of 10 transactions monthly using any of the digital channels above. Aminu Inuwa, Regional Sales Director, Abuja/NorthWest of the bank said the grand prize was a demonstration of the bank’s commitment to fulfilling its promises to its customers. “We also have about 720 customers that can transact and win from N1000 up to N1 million. “This is our first grand prize of a vehicle won by Dahiru Umar, one of the bank’s customers who is doing business at Nnewi and resides in Kaduna State. “So today we have gathered here to inform everybody and our teeming customers-

even if you have an account in Diamond Bank initially now Access Bank and even if your account is dormant, you can activate your account and have the chance to win these prizes,” he stated. Every multiple of 10 transactions qualify Customers for a ticket in the quarterly draw where a lucky winner will drive home with a brand new car. Bills payment, including Airtime purchase, Funds transfer (local and international) AccessAfrica funds transfer qualify for the promo. Inuwa added that the bank has witnessed a surge in its customer base since the flagoff of the promotion. “We have witnessed tremendous progress as customers are trooping in to open many accounts. Some who had allowed their accounts to be dormant are also reopening them because the campaign is targeted at the unbanked populace as well as existing customers. “We want to bring financial inclusion closer to everybody’s home and that’s why we are into this campaign,” he explained. On the duration of the promotion, he said that it was in its phase three and winners announced regularly. He added, “We are targeting about 10,000 customers in the directorate and for the bank, we are targeting about 50,000 new customers and we will continue to engage more customers to open accounts with the bank.”

FIRS seeks revocation of pioneer certificates from undeserving firms OLUFIKAYO OWOEYE

L- R: Ephraim Nwokonneya, director, compliance monitoring and enforcement, Nigerian Communications Commission, NCC; Josephine Amuwa, director, policy competition and economic analysis, NCC; Adeleke Adewolu ,executive commissioner ,stakeholders management ,NCC; Umar Garba Danbatta ,executive vice chairman/CEO NCC; Efosa Idehen, director, consumer affairs bureau, NCC; Bako Wakil, director, technical standards and network integrity, NCC,and Ikechukwu Adinde, director public affairs ,NCC, during the 1st Virtual Telecom Consumer Parliament (VTCP) recently at the NCC headquarters, Abuja.

NIMASA promises dockworkers of improved welfare, working condition AMAKA ANAGOR-EWUZIE

he Nigerian Maritime Administration and Safety Agency (NIMASA), has assured stakeholders of its commitment to protect the rights and welfare of dockworkers as guaranteed in the International Labour Organisation (ILO) Decent Work Agenda. Victor Ochei, executive director, Maritime Labour and Cabotage Services of NIMASA, gave the assurance in Lagos during a meeting of the National Joint Industrial Council (NJIC). A statement signed by Philip Kyanet, head, Corporate Communications of NIMASA stated that the meeting dis-

cussed a revised minimum wage and improved living standard for dockworkers through the Collective Bargaining Agreement (CBA) initiative endorsed by NIMASA and NJIC in 2018. “Dockworkers are integral to efficient and effective stevedoring operation. The NJIC has remained resolute in ensuring harmonious working relationships through the principle of tripartism and the execution of Collective Bargaining Agreements on minimum standards for the dock labour industry,” Ochei stated. Ochei, who is also the chairman of NJIC, commended the efforts of the dockworkers to keeping the maritime industry afloat, despite the outbreak COVID-19 pandemic.

He however called on the council members to cooperate with NIMASA towards ensuring meaningful negotiations that would culminate in the signing of another CBA. He stated that the Agency had made necessary arrangements for successful council proceedings. Ochei said that the success of the exercise would further demonstrate Nigeria’s compliance and commitment to the ideals of the ILO Decent Work Agenda, which seeks to promote safe work, decent wage, and freedom of association. Joyce Udoinwang, representative of the Federal Ministry of Labour, expressed the Ministry’s commitment to the welfare of dockworkers, assuring of its resolve to ensure

www.businessday.ng

no dockworker in Nigeria is short-changed. Udoinwang appealed for more cooperation from all the parties involved in the tripartite agreement. Adewale Adeyanju, president-general of the Maritime Workers Union of Nigeria (MWUN), commended NIMASA for midwifing the CBA, saying it has ensured industrial harmony and peace in the maritime industry. Adeyanju disclosed that the NJIC would reconvene in the next few weeks to deliberate and agree on new wages for dockworkers. He called for the cooperation of the terminal operators and employers of dock labour to ensure the attainment of the Decent Work Agenda for dockworkers.

https://www.facebook.com/businessdayng

uhammad Nami, chairman, Federal Inland Revenue Service (FIRS), has decried a systemic abuse of the pioneer incentive scheme instituted by the federal government, which has resulted in tax revenue leakages for the three tiers of government. According to Nami, the pioneer status otherwise granted outside the law would not enjoy tax relief regardless of the certificate issued to them, adding that owners of such certificates were requested to regularise their tax positions or risk sanctions in accordance with the law. In a statement by the FIRS Director, Communications and Liaison Department, Abdullahi Ahmad, Nami said the FIRS is currently auditing its findings with a view to pressing for the cancellation of pioneer certificates issued to undeserving companies in violation of the law. Also, the Coordinating Director, Tax Operations Group, FIRS, Femi Oluwaniyi, la@Businessdayng

mented the indiscriminate tax waivers and incentives granted to undeserving companies, saying that this had impacted negatively on revenue generation, noting that the service had discovered that pioneer status certificates had been issued to companies that were not pioneers on their fields in the real sense, hence undeserving of such status. Nami however stated that tax revenue accounted for nearly 70 per cent of what was shared at the last FAAC meeting and lauded the collaboration between the service and the state commissioners of finance, adding that this was key to bringing about increase in tax revenue. He said without the collaboration, it would be difficult for government to meet its obligations to the citizenry in such areas as infrastructure development and salary payment, which could lead to social dislocation. He also stressed the need to diversify the economy in order to create more sources of taxable income and increase tax revenue for the country.

Tuesday 25 August 2020

BUSINESS DAY

COMPANIES&MARKETS Noor Takaful pays N15m cash surplus to policyholders RusselSmith partners Kongsberg Ferrotech to MODESTUS ANAESORONYE

oor Takaful, an islamic insurance fir m in Nigeria for the second consecutive year has distributed surplus (cashback) payment worth over N15 million to participants (policyholders) who did not make claim as part of efforts aimed at promoting ethical insurance in Nigeria. The company has also announced the launch of its Mobile app with the goal of making its products and services more accessible to the retail market. The surplus payment which comes as a result of Win-Win model of insurance operated by Noor takaful-an indigenous insurance company licensed by National Insurance Commission in 2016 thrives on the pool of funds provided by the participants (insured) which is managed by the takaful operator. This second batch of payment, is an increase from 12 million naira distributed in 2019 to policyholders who

did not make claim during that year. Takaful is the Non-Interest finance insurance market that seeks to reach a large market of uninsured Nigerians cutting across the six geopolitical zones of the country. Speaking during an event held Lagos, the chairman of the company, Ambassador Shuaibu Ahmed noted that the surplus extended to participants demonstrates the commitment of the company to encouraging Nigerians to be part of Takaful insurance market as well as promote financial inclusion in the country. According to Ahmed, this surplus distribution would go a long way to further deepen penetration of insurance in the Nigerian market as Nigerians would now be more willing to subscribe to insurance given the fact that this segment of the market is considered ethical and rewarding. “No doubt, this idea of giving something back to policyholders would naturally drive interest for insurance as Nigerians would now be less skeptical about getting

involved. Surplus payment is a further proof that insurance can be done fairly and ethically”, he said. He noted that the surplus offering was designed to allow policyholders to enjoy some benefits especially when claims have not been made throughout the year declaring that no such insurance package offers such benefit. In his remarks, Aminu Tukur, acting managing director of the company, stated that the distribution of surplus to policyholders has continued to serve as a big pull for the Takaful insurance market with interested participants now increasing on a daily basis. “The surplus payment to policyholders stems from our Win-Win insurance model and this has served as a big pull for us at Takaful as we keep recording increase in the numbers of interested participants on a daily basis”, Tukur said. Tukur further stressed that policyholders would continue to reap the benefits of surplus payment annually, provided that there are no claims to take

all the money in the risk fund. While urging Nigerians to take advantage of the opportunity, he described Takaful as a cover that could be explored by interested individuals or organisations in different sectors of the economy as it guarantees insurance against losses and other attendant risks. Speaking further on some of the products as well as means devised by the company to change the narrative in the industry, Rilwan Sunmonu, head, Business Development & Sales, Noor Takaful, stated that it has become imperative to dismiss the notion that its products are strictly for Muslims adding that non-Muslims can also access it. “This company prides itself as a customer-focused organization that has invested in technology to ensure that the needs and expectations of our participants particularly in the area of claims are met on a timely basis. In the last four years, the business and client base has continued to grow for both corporate and retail sector”, Sunmonu noted.

R - L: 1st Row: Executive Commissioner, Stakeholder Management, Nigerian Communications Commission, Adeleke Morounfolu Adewolu; Honourable Minister of Communication and Digital Economy, Isa Pantami; Chief Operating Officer, MTN Nigeria, Mazen Mroue; 2nd Row: Chairman, MTN Nigeria, Dr. Ernest Ndukwe (; Director, Policy, Competition & Economic Analysis, Nigerian Communications Commission, Josephine Amuwa; CEO, MTN Nigeria, Ferdinand Moolman; 3rd Row: minister of Industry, Trade & Investment, Adeniyi Adebayo , at the virtual launch of The MTN Revv Program

introduce robots for subsea repairs in Nigeria ENDURANCE OKAFOR

igerian integrated oilfield services provider, RusselSmith, has teamed up with Kongsberg Ferrotech, a Norwegian subsea robotics company, to introduce a range of autonomous subsea robotic technologies to the Nigerian market. Designed to perform inspection, repair and maintenance tasks on subsea pipelines, the robotic solutions are with the distinct advantage of being able to assess and repair subsea pipes in a single operation without divers and other conventional vesselsupported equipment. The partnership will see RusselSmith further improving its subsea monitoring, repair and lifetime extension service offerings for rigid and flexible pipes, umbilicals and ancillaries. Speaking on the collabora-

tion between both companies, Christopher Carlsen, Kongsberg Ferrotech’s General Manager, said: “We are very pleased to collaborate with RusselSmith to introduce our autonomous robotic technologies to the Nigerian market. We believe that these technologies will have a very positive impact on Asset Integrity Management operations in the country”. According to RusselSmith’s Divisional Chief Executive, Effiong Okwong, the initiative is a game-changer for the company’s operations. ”It is also a positive development for the Nigerian Oil & Gas industry because operators in Nigeria now have access to a versatile and effective Emergency Pipeline Repair System that has a small footprint and is also autonomous, “Okwong said, adding there is growing number of ageing assets in the country that require focused maintenance and life extension efforts.

Anti-counterfeit supplies: 97% of consumers feel secured with HP’s delivery inspections - Survey TEMITAYO AYETOTO

ver 97 per cent of consumers have endorsed HP’s Customer Delivery Inspections (CDIs) as a valuable service, protectingthem from falling prey of organised fraudulent tactic, a recent HP survey across Europe, the Middle East and Africa (EMEA) has found. The CDI is an Anti-Counterfeit and Fraud (ACF) programme that offers consumers an effective means of authenticating their stock. It involves on-site checks of suspicious large or mid-sized cartridge deliveries in response to initiated by HP customers. If fraudulent deliveries are found, the HP ACF team gets alerted for follow-up action.

Suanne Schoewitz-Franchi, HP’s Global Lead of Supplies Anti-Counterfeit and Fraud Programme expressed elation over the positive feedback of consumers in response to the CDI in a statement provided to BusinessDay. He reassured that the design will strictly uphold quality and reliability standards in the delivery of performance and consistent results. “Our high standards go beyond our products. With our survey finding that 91 per cent of surveyed customers believe counterfeits present a risk to their business, it is important that we continue to fight fraudulent activity and ensure our customers have access to a reliable source of information and advice so that they have a peace of mind when buying HP products,” he stated.

Gold West Africa restates commitment to build an ecosystem for gold to thrive in Nigeria IFEOMA OKEKE

old West Africa has restated it’s commitment to building an ecosystem for gold business to thrive in Nigeria. Speaking during the closing ceremony of Kano Gold Durba held on Saturday at Ado Bayero Mall in Kano, Kolade Apata, of Gold West Africa, said the overall goal at Gold West Africa is to build an ecosystem for gold to thrive, adding that the vision has been kept alive by all the people and institutions working behind the scenes to make this a reality. Apata stressed the need for the government to support the local manufacturing sector in order to enhance the nation’s economic growth. He said “At Gold West Africa,

we believe we are here to demonstrate that Africa has always been a pioneer in the fusion of art, culture and fashion. And you have all helped us achieve this dream with your lovely pieces. Apata, represented by Sada Malumfashi, explained that “For us, the most important piece of building the gold value chain is establishing commerce. Nothing can be achieved without this critical piece. “ Therefore, we had to start in Kano. Your Excellency and Royal Majesty, thank you for letting us begin our mission here and allowing us to lean on the rich history of art, fashion and commerce. Apata said” For several decades, everyone has looked towards Kano for leadership. We intend to showcase what www.businessday.ng

we have achieved here with the rest of the world”. “It is also my distinguished pleasure to thank the Owners of the mall for being extremely flexible and investing in this initiative. It is truly a miracle when you look at what we are able to pull off in record time, despite the pandemic restrictions this year. “It is no secret that the art, jewelry and other items we have all seen within this new marketplace are beautiful. I would love to thank all our Goldsmiths , Jewellers , Dealers , Artisans that have been a part of the process of creating these gems.” According to him, “Of notable mention is Hafza Jewelry Ltd. Thank you so much for bringing everyone together very quickly.

Apata also announced that Senator Daisy Danjuma has agreed to become a Patron for developing the gold value chain especially for supporting artisans, the celebration of culture, the gold jewelry industry and the role of women in the industry. “Therefore, I would like to thank the Kian Smith Refinery, Hadiza Garbati and the customers that are eager to purchase everything we have created here,” he added. He also announced the opening of the Kano Gold Souk, which will be located at the Ado Bayero Mall. In October 2020, the Akani gold soul will house the region’s indigenous gold merchants and goldsmiths. According to him, it will also serve as the bedrock for the development of a viable gold economy in Nigeria and the

https://www.facebook.com/businessdayng

West African region. During the closing ceremony, a prize was given to the emir of Kano Alhaji Aminu Ado Bayero by Nere Teriba of Gold West Africa. Kian Smith Trade & Co. Limited, a gold exploration, mining and processing company also pledged to enhance gold value-chain in Nigeria with the launch of ‘Kano Gold Durbar’. At the event, Aminu Ado Bayero, the Emir of Kano, advocated for the businessmen Patronage into gold businesses in the country. The Emir Bayero, adding that Kano had a long-term linkage of the gold business for decades, appealed to authorities to help the miners in promoting their business. “We wish to advise our business community to involve @Businessdayng

themselves into gold mining because of its significance to the economic and social impacts in society”. The Emir disclosed that “ investment into Gold business will also benefit the market to grow; we are always calling for the investors into this trade to make sure that gold business thrive”. In his welcome address, the Magajin Garin Kano, Nasiru Inuwa Wada who is also leader of the stakeholders initiative in Kano God Durbar, said It is high time that we should be able to utilize the Gold that we have to create a Gold economy in Nigeria. Na s i r u I n u w a Wa d a thanked the emir of kano for his present to the closing ceremony, saying, this signifies the Emir’s support to boost the Gold economy.

Tuesday 25 August 2020

BUSINESS DAY

BDTECH

In association with

E-mail: jumoke.akiyode@businessdayonline.com

No plans to privatise Nigerian Communications Satellite Limited - Pantami Jumoke Akiyode Lawanson

he Nigerian Communications Satellite (NigComSat) Limited, a company under the federal ministry of communications technology, incorporated for the provision of fixed satellite services has been under severe pressure in the last few years and has been rendered useless and unprofitable, however the federal government is still holding on to it with no plans yet to privatise the company and allow it to adequately revolutionise ICT in Nigeria. Isa Ali Ibrahim Pantami, Nigeria’s minister of communications and digital economy, has said that due to security factors, the government is reluctant to privatise the company. “NigComSat was playing a significant role in the security strategies of battling threats to the country including the war against terrorists,” Pantami said. NigComSat’s efforts to be the leading satellite operator and service provider in Africa by exploiting the commercial viability

of the country’s communication satellite(s) for its socio-economic benefits has been futile, as it hasn’t generated expected revenues and telcos operating in Nigeria still spend billions of dollars

on satellite services from foreign companies. The minister while speaking to the media in Abuja last week, however admitted that NigComSat is not very viable and

is currently being probed by the House of Representatives Committee on Insurance and Actuarial Matters. “The failed $300 million launch of the NigComSat-1, as well the

N180.9 million insurance premium allegedly paid for the failed NigComSat-1 project which was launched in 2007 is being investigated.” NigComSat 1-R is a replacement satellite launched by the Chinese in 2011 for the initial NigComSat-1 satellite which failed in orbit in 2008 not long after it was launched. While official cost for the original Nigcomsat-1 is usually put at $200 million, other authoritative sources usually put the figure at between $300 million and $340 million to cover construction, launch and insurance for the satellite in its first year in orbit. Since the investigation commenced recently, it has awaken the urge for privatisation with calls from industry stakeholders, that the company be sold to make it profitable. However, the minister said the Nigerian government is not going back on its suspension of privatisation of the company . “There have been improvements in NigComSat and there are already moves to commercialise services of the company,” he said.

9mobile embarks on new strategies to pull back, retain lost subscribers ... earmarks N195 million for customer reward campaign Jumoke Akiyode Lawanson

n a bid to attract and retain more customers on its network after a daunting year and having lost over 1million subscribers in the last one year, 9mobile, Nigeria’s fourth largest telecommunications operator has embarked on a massive reward promotion for customers in its recently launched Mega Millions Promo campaign. Launched last week, the promo is designed to reward 90 lucky customers with N1 million daily. The telco also revealed its partnership with Transsion Group — manufacturers of Tecno mobile, iTel and infinix, to give out smartphones every hour for 90 days and a grand prize of N10 million

at the grand finale. Speaking to journalists during the virtual launch of the promo, Alan Sinfield, the chief executive officer of 9mobile, said that the promo is one of the company’s ways of supporting and giving back to Nigerians during the uncertain and challenging times caused by the COVID-19 pandemic. “We realize the challenges faced by Nigerians during this period, and we have designed this promo to help cushion the effects of the Covid-19 in Nigeria as families and individuals continue to confront the economic impact of the pandemic. This promo also demonstrates our philosophy that customers are at the core of our business, so we continue to prioritise them in our decisions. We have made

www.businessday.ng

sure that everyone is covered from new to existing customers, including customers who have not used their lines for some time; there is something exciting for everyone,” he said. On how the telco has prepared to follow through on its decision to dole out huge amounts of cash and keep up network quality even with supposed influx of new customers, Sinfield said; “the network is sound, robust and we have more network technology shipment on its way to Nigeria to expand network coverage. We have comfortably earmarked N195 million to reward our customers.” Speaking on plans to acquire and retain subscribers on its network, Layi Onafowokan, acting director, marketing at 9mobile said; “Apart from

https://www.facebook.com/businessdayng

this newly launched promo, we have other strategies like the revamp on our Moreflex and Morelife packages which have reduced tariffs of 11kobo per second for both local and international calls. We also have 100 percent data bonus on any data plan in the first six months for new customers, and we will be coming up with more value services in the coming months and years, to keep subscribers on our network.” Describing the modalities of the promo, Onafowokan, said the Mega Millions Promo adopts a recharge and win mechanism. “To participate, customers can simply recharge their lines with N200 or more to win a smartphone every hour or top-up N1000 and above to win the N1million

@Businessdayng

daily prize. A cumulative recharge of N10,000 over the 90 days duration of the promo qualifies customers for a chance to win the N10,000,000 grand prize,” he said. “Participants can increase their chances of winning with rapid and frequent recharges. New customers will also get up to 100 percent data bonus for 12 months with free 1GB and N500 airtime,” he said. Onafowokan maintained that 9mobile would ensure that the 90day promotional engagement will be done with the utmost credibility, stating that the company has engaged the services of relevant authorities to supervise the draws and prize redemption to ensure transparency in line with regulatory standards.

Tuesday 25 August 2020

BUSINESS DAY

property&lifestyle How capital market’s low interest regime is encouraging affordable housing delivery …as Alpha Mead redeems N1.45bn bond, boosts confidence in real estate market CHUKA UROKO

ue, largely, to its low interest regime, some real estate development companies have gone to the capital market to raise bonds and, to a great extent, that has encouraged and enabled them to develop quality and affordable housing for Nigerians. The thinking among these developers is that the capital market option is the only window open to the real estate industry to attract more capital to make affordable housing possible because it is difficult to deliver anything affordable with 24 – 30percent interest rate that obtains in the open market. For lack of financial capacity, which is made worse by high cost of funds in the country’s money market, Nigerian developers are unable to deliver houses in large numbers, leading to the wide housing demand-supplygapinthecountry estimated at 20 million units. For a country with over 70 percent of its citizens living in rented apartments, the need for decent and affordable accommodation, which has been amplified by the ravaging Covid- 19 pandemic,

cannot be over-emphasised. The recent entry of Alpha Mead Group to raise money from the capital market through bond issuance was made to serve this purpose— delivering affordable housing to Nigerians, especially the middle class. The company, early last year, approached the capital market for the Alpha Mead Funding Plc N1.45 billion Series 1 tranche A 19.76 percent Fixed Rate Bond due 2020 and repayable on June 29,2020. “We came to the Capital Market as an underdog; raised N1.45 billion out of a N10 billion capital raise programme. We used the money for the intended purpose to build houses for Nigerians to live and invest,” Femi Akintunde, Group Managing Director, explained to BusinessDay at the weekend. Akintunde explained further that the houses they built with the money had been sold and so they have fully paid back the entire fund to the lenders together with the agreed interest, adding, “we were determined not to allow Covid-19 to be an excuse not to pay back in time.” By this action, the company has not only erased

market fears and proved skeptics wrong, but also boosted confidence in the real estate sector which many would consider too risky to invest in. Damola Akindolire, the managing director of Alpha Mead Development Company (AMDC), said that “redeeming the bond at a time like this speaks to our resilience as a company and the strength of Alpha Mead Group that has evolved from a facility management company to a total real estate solutions organization with footprint in several African countries.”

Tope Adeniji, the company’s Chief Finance Officer, added that sound resource management was key to their overall strategy of ensuring that the financial obligations were met as they fell due. “With the negative impact of Covid-19 on the business environment, a combination of efficient liquidity management and financial prudence was deployed to ensure that obligations like the bond repayment was met as at when due,” he disclosed. Akindolire explained that the series A programme was

their first entry into the capital market, making them the third real estate company to undertake such a venture. He added that their offering did not have any credit enhancement cover like other instruments in the market, especially for a first time issuer and yet it was fully subscribed by key players in the industry. “The full subscription of the bond was a huge statement of confidence in our business and we were determined not to disappoint our partners; we also wanted to use this programme to

earn market confidence and prove that we have the right model to make affordable and quality housing possible in Nigeria, he assured. He informed that achieving this feat in the market was made possible by a combination of factors, including their ISO-certification; selecting and working with the right partners, and their business model which has always been to focus on the middle class who are the people that drive the economy. Riding on the success of this outing which has provided homes for over 100 families, Akindolire disclosed that they would soon be returning to the capital market to raise more funds that would enable them execute their next project tagged ‘Project 1000’ (P1K) aimed to provide affordable housing for 1000 families at low mortgage rates through access to the National Housing Fund (NHF). The company is giving a 3-year guarantee on rental income to investors under its various rental schemes, including Rent4less, Rent-toown and GRIP which is an acronym for ‘Guaranteed Rental Income Programme’ for local and Diaspora investors.

Reasons Oniru is transforming into estate of the future for living, working, leisure CHUKA UROKO

or being a commercial nerve centre of Lagos with breath-taking mixed-use and iconic developments, Oniru which spans Ikoyi, Victoria Island and Lekki, is out with ambitious initiatives to transform the current estate into the most sought after neighbourhood to live, work and play . The new leadership in the kingdom under Oba Omogbolahan Lawal (Abisogun 11) says it is committed to leading large-scale change by inspir-

ing climate leadership and deepening social inclusion for more sustainable livelihoods. The leadership has a vision that covers the environment and will entail tackling climate change and evolving environmental-friendly initiatives such as recycling. The vision also has to do with Health. “As we would notice, there is no public health facility in this neighbourhood,” noted Oba Lawal in his opening remarks at a two-day town hall meeting in the kingdom at the weekend, adding that power and sustainable livelihoods would also be addressed.

www.businessday.ng

As a major commercial hub and residential destination in Lagos, Oniru has a fair share of environmental and infrastructure challenges which many business ownes in the neighbourhood have complained of how these are negatively impacting on their business. But, the new transformation agenda, according to the Oba, would address these issues including drainages and street lighting. It would also address issues of AgricEnterprise Opportunities and Grants amongst others, for which he has solicited help

from the Lagos State government. The Oba explained that the reason for the Town Hall meeting was because he has always tried to avoid the predict-and-provide theory or syndrome in all the leadership positions he had occupied. “Accordingly, before I embark on any vision, design any policy, execute any programme or implement a project, I ensure stakeholders’ feedback is sought. This is to ensure stakeholder engagement is integrated into the process, he said. For this reason too, he explained, he had brought on board two major consultants, BA Law and Gbenga Olaniyan and Associates (Estatelinks) as solicitors and development consultants respectively to ensure that all issues relating to Iru Land were handled professionally going forward. In his presentation at the meeting, Olaniyan, Estatelinks’ CEO, gave further insights into the Oniru transformation agenda driven by what the Oba has termed Let’s Grow Iru Together (LeGIT) Vision. He disclosed that the consultants were reviewing the entire estate from a topographical and distribution

https://www.facebook.com/businessdayng

viewpoint to reduce flooding and improve the roads infrastructure in the neighbourhood, adding that they were also taking stock of the power demand in the estate even as various power operators were already sending in proposals. “Safety of lives and property is key. Best practices in other estates worldwide are being critically reviewed to activate the best model for Oniru Estate,” Olaniyan assured, adding, “it has been noticed that a lot of developments have flouted simple planning regulations.” According to him, this has affected the estate’s physical planning control and also created discomfort for neighbours and defaced the estate. “Consultations are on-going for improved and enforceable regulations for the benefit of all,” he assured. He informed that there would be an update of land titles, explaining that data on title documentations/deeds were to be centrally collated at the Central Estate Management office. He added that ease of payment of ground rent and development levy would be introduced. To bring sanity into the environment, Olaniyan dis@Businessdayng

closed that traffic control and road management strategy would be put in place. “Traffic flow strategy will be created to remove bottlenecks such as the entry into the estate from the New Market and Ozumba Mbadiwe,” he said, adding, “separate weekend arrangements are to be made for waterfront event centre zone and the alternative access road.” The transformation also includes making the estate technology-compliant and, according to Olaniyan, plans were underway to engage service providers for broadband internet services within the estate just as efforts were being made to create an eco- and family-friendly environment. “The Oniru waterfront is set for change; we must create a healthy, family-friendly environment for all. A tree planting campaign will be commenced by the Oba in September 2020,” he revealed Among other things, the transformation agenda would also include beautification of the environment that would involve tree planting, shanty disengagement, town planning, market restructuring, and banning of road-side sales and street hawking.

Tuesday 25August 2020

BUSINESS DAY

EDUCATION Weekly insight on current and future trends in education

Primary/Secondary

TETFUND appoints Anibeze, Didia Coordinating Editors for Anatomy Book MARK MAYAH

he Board of Trustees of the Tertiary Education Trust Fund (TETFUND), has appointed Chike Anibeze (Prof) of the Enugu state University of Science and Technology (ESUT) and Blessing Didia (Prof ), the immediate past vice Chancellor of Rivers state University as National Coordinating Editors to develop a manuscript in Anatomy for production into a basic textbook for use by tertiary institutions in Nigeria. The book which is to be titled: “Fundamentals of Anatomy”, will service the basic anatomical needs of students in medicine, Anatomy, nursing, physiotherapy

Elias Bogoro, executive Secretary, TETFUND

(medical rehabilitation), radiography and other health sciences.

The commencement of the project followed the approval granted by the TETFUND

Technical Advisory committee for the manuscript - outline and proposed content - summary earlier submitted by Chike Anibeze. The Coordinating editors of the project are therefore commissioned to select appropriate experts in the field of Anatomy preferably of the professorial cadre and reflecting competence and geographical spread in carrying out the national assignment. BusinessDay however gathered that the Coordinating Editors will pick the “egg heads” experts from the nation’s six geo-political zones of North-West, NorthEast, North - Central, South - West, South - East and South - South. The Coordinating editors are expected to deliver on the agreement within the stipulated period of time.

Monitoring of schools as WASSCE is on-going is a daily routine - Seriki-Ayeni, DG OEQA • Urges schools to adhere strictly to proper hygienic guidelines and protocols on COVID - 19 MARK MAYAH

n a continue bid to ensure safety for terminal students in post primary schools as the West African Senior School Certificate Examinations (WASSCE) currently on - going in Lagos State, the DIrector General, Office of Education Quality Assurance Abiola Seriki-Ayeni and OEQA evaluators embarked on a second phase COVID-19 safety and hygiene compliance monitoring exercise to ensure that schools continue to adhere strictly to the guidelines on safe reopening of schools as specified by the Federal and the Lagos State Government. The exercise, which cut across the State Education Districts, is to supervise the WASSCE examinations to guard against malpractices and to ensure that public and private schools meet the recommended safety standard for reopening. The OEQA evaluators are also to assist schools objectively in assessing the level of safety, security and help to clearly identify areas of improvement while encouraging them to take concrete steps in addressing identified gaps. The reopening compliance monitoring has not only helped schools to carry out revision lesson to prepare students for the examinations, but

has also prevented the spread of COVID-19 infection among learners through the use of face mask, washing of hands with soap and running water, maintaining social distancing as well as the use of hand sanitizer. Speaking during the exercise, the Director General, Abiola Seriki-Ayeni disclosed that all the schools she visited, complied with all examination procedures. She however reminded school owners that it is very important for them to understand that we are partners, and the reason for the examination is to build a successful future for the students. “We must not compromise

standard. Therefore, we must ensure that there are checks in place against examination malpractices and against COVID-19 infection. “Schools must ensure they disinfect the environment and make sure students sign in on arrival. Schools are expected to have sanitation managers that will ensure that all environmental and health protocols are observed. “Aside, schools must also register with OEQA online to obtain clearance for reopening. They must engage the services of learning managers to assist teachers develop learning plans that include distance and blended learning

Abiola Seriki-Ayeni, DG OEQA Lagos State www.businessday.ng

plans to be uploaded on OEQA website while students should strive to protect each other by using face mask”. Recall that Abiola SerikiAyeni enlightened the general public during an official visit to Traffic Radio FM on the online registration. “We are supporting schools holistically with an understanding that the registration for reopening of the terminal students and subsequent clearance will assist schools to maintain overall safety and hygiene protocols”. According to her, “OEQA evaluators are now using technology to scale evaluations for seamless schools registration process. Registering to get a special code is the first part of the process that involves selfassessment, training and verification for clearance. Schools are to download the Federal and Lagos State Government Schools Reopening Guidelines and the Safety Guidelines from the agency website. All schools must also make provision for isolation room in case of emergency.” As WASSCE is on going, the Director General however urged all schools across the state to shun examination malpractice in any guise, stating that OEQA evaluators will be out to monitor the examinations in full scale, adding, “any school caught manipulating will face the music.”

https://www.facebook.com/businessdayng

Higher

Human Capital

‘Collaboration among education administrators best option to fix investment challenges in e-learning’ Kelechi Ewuzie

ducators, school owners and other stakeholders in the education sector are racing against time to tackle the current reality of the new normal in the sector occasioned by the ravaging impact of coronavirus pandemic that has disrupted the global economy. But amid this challenge, stakeholders in the sector say this pivotal industry can leverage technology across various levels to find home grown solutions to teaching and learning for millions of Nigerian children. The experts, who spoke at the second edition of TOSSEtech dialogue webinar event organised by Edumark Consult with the theme, ‘Education and Technology: The Future is Here’ said the challenge facing education across the country is the lack of robust investment in technology. They observed that the inability of some proprietors of educational institutions to see the venture as a business and incorporate technology into it present a major drawback in creating solutions, solving problems and making impact. Juliet Chiazor Ehimuan, country director, Google Nigeria, who emphasised on the theme, said the rise in technology has helped to expand our knowledge in every areas of life, transformed the way we live our lives, democratise the way we access information and the internet. In her paper entitled, ‘Digital Transformation is the New Normal’, Ehimuan who was the Guest Speaker, said with technology, we can begin to expand our thinking and the way it can be used to transform education. She emphasised on the ways technology can be used to enhance teaching to include; self-directed learning and remote instruction, productivity enhancement and workplace readiness. According to her, “Selfdirected learning and remote instruction allow us to customise learning, engage students beyond classroom and break barriers. Every business is looking at how to increase productivity and cost with technology. We can have virtual campuses where the number of students is unlimited, with that, we can save cost. “Workplace readiness ensures that students have job ready skills set. There is an @Businessdayng

Chukwuemeka Nwajiuba minister of state for education

interplay that can be mutually beneficial preparing for the jobs of the future”. For these solutions to be reliable, Ehimuan said there is a need for reliable telecoms infrastructure and for rural areas to have access to portable devices. The Google Nigeria country director, further stress the need for collaboration among administrators and invest in e-learning and skills development, as well as reach out to other relevant stakeholders. “Technology is the present and future, collaboration is key. Education is next in line to level growth, we can work together to be ahead of the game, “she said. Speaking at the opening ceremony, Yinka Ogunde, director of Edumark Consult, said the country has found itself in a situation where technology must be fully utilised, adding that during the first edition of the programme held last year, the possibility of the impact of technology in terms of teacher /learners relationship was being discussed. According to her, “When we held the first edition, we were talking about the possibility of technology and teachers not seeing their students when they are learning. Now, we are confronted with the reality and we must make the best use of it and continue to live our lives.” In her keynote, Femi Ogunsanya, President, Association of Private Educators in Nigeria (APEN) expressed delight about the online meeting unlike the usual physical one, while congratulating Ogunde for her diligence and enthusiasm about education. “She has a mindset of making a difference. The fact that we are online has blown my mind,”she said. Olufunke Amba, director, Vivian Fowler Memorial College for Girls, Oregun, Lagos, said the pandemic was a wakeup call, adding that the new currency for us as a nation is technology as we cannot afford to be complacent.

Tuesday 25 August 2020

BUSINESS DAY

EDUCATION

Poly Ibadan Orders Resumption Of Staff Ahead of Reopening REMI FEYISIPO, Ibadan

o put in place adequate measures ahead of reopening, The Polytechnic Ibadan on Sunday ordered the resumption of some members of staff. The staff members who

are expected to resume on Monday are Deans, Heads of Academic Departments, all Non-Teaching Staff on Grade levels 11 to 14, and those on essential duties. In a statement signed by the institution’s registrar, Modupe Fawale on Sunday said “please be informed that all Deans, Heads of Academic Departments,

all Non-Teaching Staff on Grade levels 11 to 14, and those on essential duties are to resume back to work on Monday, 24th August, 2020 at 8.00am. “This is to ensure that adequate preparations are put in place for the School reopening and attention given to some academic related issues on ground.

“Staff are enjoined to wear face masks, use sanitizers/wash hands regularly and maintain social distance measures in accordance with NCDC, Federal Ministries of Health and Education regulations. “Also note that others whom their services may be needed can be called anytime.”

Special Foundation sustains learning for children of lowincome families amid COVID-19 STEPHEN ONYEKWELU

pecial Foundation Literacy Project has sustained learning for children of lowincome families amid the COVID-19 pandemic that has disrupted schooling in the traditional sense. To reduce the spread of the COVID-19 pandemic, the Nigerian government-enforced nationwide school closures in March 2020 which disrupted the education of millions of children. Children whose lives have been the most affected are those from low-income homes. Due to the high rate of poverty and social inequality, the majority of these children lack access to any learning tools. The Special Foundation Literacy project which started June 16, 2020, in Kuchiyako Community, Kuje, Abuja was founded to provide learning opportunities for children in marginalised communities during the pandemic. The literacy project uses an EdTech solution for remote learning- The

the immense growth the children made. “The Special Foundation’s partnership with Kazahchat School and Mavis talking books has been instrumental in the successful execution of the Literacy Project. We’ve been pleased with the results of the baseline tests which have shown improved learning from the children,” Seyi Akinwale, founder of the project said. “If the environment is going to change we cannot particularly focus on our businesses alone, we have to engage with leaders to collectively find solutions to the ills in the society” Besides the academic improvements, the children have developed a renewed love and enthusiasm for learning and they are ready to return to school after refreshing their memories with the aid of talking books and pens. They were also very conscious of following the required COVID-19 safety procedures after they saw the project team constantly use face masks, practice physical distancing and ensure that every child uses the provided hand sanitizers.

L-R: Oluwakoyejo Oluwatosin, CEO Chronicles Software; Josephine Alabi, Recipient’s Mother; Tosin Alabi, The Winner; Johnson Alabi, Recipient’s Father at SuccessBOX Mega Excellence Award Presentation held recently at Elizade Plaza, Anthony, Lagos

18 UITH Medical Staff Test Positive for COVID-19 JOHESU SIKIRAT SHEHU, Ilorin

ighteen of the medical staff of the Unive rs i t y o f Il o r i n Teaching Hospital (UITH), Ilorin, Kwara state are positive to COVID-19 and are currently undergoing treatment for coronavirus in the teaching hospital. Speaking with journalists in Ilorin on Friday, in the sideline of a meeting of members of staff of the hospital, the chairman of the Joint Health Sector Union (JOHESU) and Nigerian Union of Allied Health Professionals (NUAHP) in the hospital, Pastor Oluwawunmi Olutunde, said that some staff had tested positive severally. The statement was corroborated by members of the National Association of Nigerian Nurses and Midwives (NANNM) in the hospital. Olutunde, who said that the UITH is yet to have COV-

ID-19 isolation centre, added that the management had converted one of the wards in the hospital to a centre. “We want better protection and adequate PPE for our staff. We are exposed because we lack a lot of materials here. They’re trying to rectify the issue of PPEs, but it’s not been given. It’s promising. “Presently in our hospital here we have 22 nurses, eight assistants ward orderlies, six

Sulyman Age Abdulkareem, Unilorin VC www.businessday.ng

cleaners. We used to keep Covid-19 patients at the state isolation centre. We no longer move them to state isolation centre, we nurse them here in the UITH. “It’s actually a converted ward. We’ve not got our own isolation centre. It’s supposed to have been built for us by the government. But they’re yet to build it, coupled with the fact that there’s an increase in the number of patients who are testing positive, we now have to take patients in here to nurse them. So, with that, the ward was converted to that. “Our agitation is that as the ward is converted, it should be properly adjusted to suit the purpose in order not to affect people who are working there. Those working there are not comfortable with the situation”, he said. Olutunde, who also called on the management of the teaching hospital to be more concerned on payment of

the 2009 and 2011 promotion arrears, said that the staff had been patient enough. “Our members are tired of waiting. The management should not waste time conducting promotion as at when due so that arrears would not be accumulating. This is a major grey area of our demands from the management. The management has promised to look into other administrative demands, saying they’re working on them. The workers, who also complained of security challenges in the hospital to the management, said cars of some staff had been stolen, houses were burgled, and some staff beaten. “The management has employed more security personnel. We have seen more of security personnel patrolling, but they still need to do more at increasing security personnel to ward off criminal elements away from the area,” he said.

https://www.facebook.com/businessdayng

Adamu Adamu, education minister

Mavis Talking Books™ (an audio-visual, offline solution). The user simply has to turn on the Talking Pen and tap on the pages of the book to hear the lessons and do exercises in a fun and engaging manner. This eliminates the need for a mobile device, internet connection, TV or Radio and allows children to learn in the absence of a teacher. The Literacy Project has so far impacted the lives of over 300 children in Kuchiyako community by improving their literacy and learning profoundly. Baseline tests at the start of the project and further assessments during and after the project revealed @Businessdayng

“The talking pen makes us learn and teaches us our pronunciations,” Grace Obodo, a beneficiary said. The Special Youth Leadership Foundation is a privately funded social impact organization focused on building Africa’s next set of Leaders by refining their minds through education. The foundation seeks to achieve this by empowering less privileged, gifted African Children through education, mentorship and leadership opportunities. It does this through its Inspire Scholarship for orphans and vulnerable children, mentorship and leadership training; school builds programme and Special Summer School.

820

DAY BUSINESS DAY

Thursday 20 BUSINESS August 2020

www.businessday.ng https://www.facebook.com/businessdayng www.businessday.ng https://www.facebook.com/businessdayng www.businessday.ng https://www.facebook.com/businessdayng

Tuesday 20 25 August August 2020 2020 Thursday DAY BUSINESS

@Businessdayng @Businessdayng @Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

Media business Disquiet in advertising industry as NBC, Lai Mohammed sideline APCON in new broadcasting Code invited to contribute to it”, an operator said. This latest development is coming at a time Buhari government has left APCON without a board for more than five years, a development that has stalled some activities of the council.

Daniel Obi

he Nigerian Code of advertising practice as amended by Act 93 of 1992 vested the powers of regulating and controlling the practice of advertising in Nigeria on Advertising Practitioners Council of Nigeria, APCON. But the council was not involved in the new broadcasting Code which spelt out a number of rules for advertising practice in Nigeria, some sources close to NBC have alleged. It is therefore confusing whether two bodies will be regulating the advertising practice simultaneously. The alleged non-involvement of APCON in the amendment of the new code is creating worry among advertising practitioners who now tend to believe the criticism that the code was not a product of holistic stakeholder engagement. In its intention to stimulate growth in advertising industry and promote local content, the code mandated broadcasters not to transmit adverts produced by foreign entities,

companies or organisations for the Nigerian market. Prior to this Code, industry operators told BusinessDay that APCON was charging advertisers with foreign content in their advertisement about N500,000. This was seen as a source of revenue for APCON as advertisers were ready to pay to produce clearer advertisements abroad. The APCON registrar, Ijedi

Iyoha could not be reached in Lagos for comments, but industry operators who spoke to BusinessDay said APCON representatives could have raised the issue during the amendment of the code if the council were involved in the review of the code. “It is a slight on our industry if government is drafting a code that involves our sector and our apex regulatory body is not

Due to lack of board, APCON management has not been able to enforce certain rules and install fellows of members who are due to the position. The Industry operator said “IMC industry without APCON board is like an aircraft flying without a control tower”. Operating without a board for over five years is severely affecting APCON. For instance, APCON is waiting for a reconstitution of its board to push for the review of APCON law to accommodate digital Ad monitoring and regulation. The Buhari administration in July 2015 dissolved the board of APCON alongside the boards of other agencies and parastatals. However, up until now, APCON, which regulates Nigeria’s Advertising industry, does not have a council.

X3M Ideas in strategic battle against Covid-19, builds first disinfectant tunnel for School Daniel Obi

agos agency, X3M Ideas has climaxed its 8th year anniversary tagged “X3M good for 8 years” as the agency donated a first of its kind wash hand station facility and Glo MiFi internet modems with unlimited data, to Opebi Senior High School, Opebi - Ikeja, Lagos to further combat the dreaded Covid-19 and safeguard the health of the students’ population. The donation which is largely seen to complement

the efforts of both the Federal and especially, the Lagos State government, in their combat against the ravaging Coronavirus, will help to further enhance the Covid-19 prevention protocols especially in the area of hand washing and general hygiene of the young students and also provide them access to information and education on the pandemic. The facility, located the entrance to the Opebi school complex which houses the Opebi Junior School and the Senior High School, is a well-secured, special clearview panel fence solution

where the beneficiary community can walk through the disinfectant tunnel before assessing the school. It also allows for free airflow with good headroom to give an appealing ambiance. In her welcome address, an elated Principal of the school, Olugbewesa Kofoworola while thanking the donor of the facility, X3M Ideas, a company she noted has consistently supported the efforts of the Lagos State State governor, Babajide Sanwo-Olu, disclosed that X3M Ideas has brought a worldclass facility to her school and

“we hope to maintain it by the grace of God”. Reflecting on the strategic fit between the project and current global health challenges, the Executive Chairman, Lagos State Universal Basic Education Board (LASUBEB), Wahab AlawiyeKing who chaired the commissioning said, “we know what COVID-19 has done throughout the world and we are to adapt to the new normal and part of the new normal is what we are here to commission today. He commended X3M Ideas for the good works in Lagos state.

Why 9mobile is doling out N195m to customers in three months

n a bid to retain and attract new subscribers, Nigeria’s telecommunications company, 9mobile has rolled-out a massive reward promotion for its customers through a campaign tagged Mega Millions Promo. The promo, designed to reward 90 lucky customers with N1 million daily, will also give out smartphones every hour for 90 days and a

grand prize of N10 million at the grand finale. Speaking on the vision behind the promo, the Chief

www.businessday.ng

Executive Officer, 9mobile, Alan Sinfield, emphasized that the promo was one of the company’s ways of supporting and giving back to Nigerians during the uncertain and challenging times caused by the Covid-19 pandemic. Promo is expected to help cushion the effects of the Covid-19 in Nigeria as families and individuals continue to confront the economic impact of the pandemic.

“We realize the challenges faced by Nigerians during this period, and we have designed this promo to help cushion the effects of the Covid-19 in Nigeria as families and individuals continue to confront the economic impact of the pandemic. This promo also demonstrates our philosophy that customers are at the core of our business, so we continue to prioritize them in our decisions.

https://www.facebook.com/businessdayng

Consumer goods retailer, FoodCo unveils Quick Shop convenience stores

n its bid to make quality and affordable consumer goods accessible to customers, FoodCo Nigeria Limited, a multi-channel retailer, has announced the launch of its first purpose-built convenience outlets, tagged, FoodCo Quick Shop, with two new outlets in Ibadan, Oyo State. This extends the brand footprints to 11 across the country. Speaking on the launch, Ade Sun-Basorun, Chief Executive Officer of FoodCo Nigeria Limited, said in a statement that FoodCo Quick Shops are designed to bring organized retail “closer home,” in order to address the challenges of limited options for top quality products customers typically contend with while shopping in neighbourhood stores. He said: “We are excited

to announce the launch of FoodCo Quick Shops, our model neighbourhood convenience stores where community members can readily dash in for their everyday essentials such as groceries, fruits and vegetables, toiletries, meals and pastries. “We continue to make these investments, despite the challenging economic climate particularly in the face of the COVID-19 pandemic, because we are a proud Nigerian brand vested in the growth of the country’s organized retail sector. After 38 years of serving this market, we have come to share a bond with our customers and understand their yearning for easy access to the convenience and friendly service that organized retail offers, which also informs our strides,” he added.

Coca-Cola Nigeria introduces new campaign since lockdown

oca-Cola Nigeria has launched a new campaign, “Open Like Never Before”, its first since Covid-19 changed the world in so many ways. According to a statement, Coca-Cola in Nigeria temporarily suspended all planned marketing activity in April, redirecting resources towards communities and supporting its most affected retail partners. Alongside its bottling partners and The Coca-Cola Foundation, the company pledged to donate more than $100m globally to organisations leading local relief efforts. In Nigeria, it has provided a grant to the International Federation of Red Cross and Red Crescent Societies (IFRC) to help curb the spread of COVID-19 across Nigeria.

This partnership with the IFRC impacts 1.3 million people in Nigeria and other countries in the region, the statement said. Now, Coca-Cola is returning to air in Nigeria with a new campaign - “Open Like Never Before” which marks a time of cultural and social change. It begins with a manifesto written specifically for Coca-Cola by award-winning spoken word artist, George The Poet. That manifesto is founded in the promise of new possibilities discovered through lockdown and calls on us all to be “Open, Like Never Before” and to appreciate all that we have around us. The words of George encourage us to be “open to change”, to appreciate things from a new perspective and to find opportunities in this ‘new normal’.

Nigeria’s Image Merchants bag three PR Golden World Awards

he Image Merchants Promotion Limited (IMPR), the publishers of PRNigeria and Economic Confidential has bagged three Golden World Awards of the International Public Relations Association (IPRA) 2020 for its PR campaigns in Nigeria. In a message to IMPR, the Member Services Manager of IPRA, Janice Hill, according to a statement said the winning entries include the Nigerian Air Force (NAF) campaign on ‘Women of War’ which bagged Crisis Management Award Category; the Nigeria Customs Service (NCS) Campaign on partial border closure to curtail smuggling of foreign rice which bagged Public Affairs Award Category and the @Businessdayng

Nigerian Communication Commission (NCC) launching of Emergency Communication Centre which bagged New Service award Category. The IMPR had similarly won 2020 African Public Relations Awards which recognized Superior Achievement in Branding Reputation and Engagement (SABRE) for the same campaigns it executed for the organisations. With latest award, IMPR has joined the rank of global PR brands in winning multiple PR awards this year. Other multiple-award-winning agencies included Dentsu Public Relations Inc of Japan, LLYC Communication of Spain, Hill+Knowlton Strategies of the USA, HvdM of Netherlands and V+O GREECE of Greece.

Tuesday 25 August 2020

BUSINESS DAY

Marketing & Pr Nigeria’s recruitment industry has benefited from adopting virtual approach, says Foluso Agbaje Foluso Agbaje is the Head of Human Resource at Jobberman, Nigeria’s foremost recruitment platform that helps employers and jobseekers solve their recruitment and employment challenges. In this interview, Agbaje who has experience in Human Resource Management and Management Consulting across various industries including Technology, Telecommunications, Banking, and Professional Services spoke on a number of issues including recruitment, impact of Covid-19 on business. She says in recruitment there is no perfect candidate who will tick all the boxes but to hire right, companies will need to hire candidates who have the critical skills that have been identified for the business. Daniel Obi reports. Excerpts. A lot has changed lately since the outbreak of the pandemic, most companies have to go virtual. What has the experience been for Jobberman and the recruitment industry? ecruitment has become a predominantly virtual exercise now due to the pandemic. If you had asked most HR professionals in 2019 if they would have ever hired a candidate without meeting them in person the answer would have been a resounding no. The pandemic has forced companies to find innovative ways to fulfill their hiring needs, depending on advancements in technology with the use of video interviews, group case studies using virtual zoom classes and digital psychometric assessments to name a few. At Jobberman all our internal recruitment has been done virtually over the past 6 months using some of the former mentioned digital tools. Overall it has been a good experience because of the time and cost saved that would typically have been associated with in-person recruitment. On the other hand, there have been a few painful experiences. For example, having to give up on an interview due to poor internet connection. Having said that, the recruitment industry has definitely benefited on the whole from having a more virtual approach. Jobberman recently launched a skills assessment product for employers? What is the idea behind it? The assessment product provides companies with an objective way to find the best candidate for the role. We have a wide suite of tests for various roles and to test different skills sets, and the best part is that the standard tests can be customized to fit unique client requests as an additional service. As the assessments are all done virtually, clients do not have to worry about renting out a suitable test centre. Candidates also do the assessments from the comfort of their homes at a time that is convenient for them, and the results are instantly sent to your chosen internal contact as soon as the candidate submits the test. A lot of our clients also worry that candidates will cheat if they do the tests at home unsupervised, however the assessments are done with image proctoring technology to ensure that candidates are dis-

Foluso Agbaje

www.businessday.ng

jobs listed by our clients through initiatives such as our free online soft skills training and virtual youth events. Employers can then visit our platform confident in the knowledge that the candidates applying for their jobs have the skills they are looking for in their organization. As the Head HR of Jobberman, you must have interviewed and recruited a number of people. Let us in on the magic. What’s the interview process like at Job-

‘

Our job seekers and employers should look out for our ongoing Soft Skills training and our upcoming virtual career fair happening in September

‘

couraged from cheating. The tests are also timed so it imitates the environment you would have in a regular test centre. The recruitment industry is a competitive and crowded space! What’s been the key for Jobberman to amass over 60,000 employers? Over the past 11 years, Jobberman has worked hard to build a ‘customer-centric’ business model. We are constantly listening to the needs of our users and we take feedback very seriously. For example, we diligently track our Net Promoter Score (NPS) and our Business Development and Customer Experience teams work hard at the relationship management side of our business. This careful tracking of feedback and relationship management over the years has been useful in ensuring that our product offerings are not only fit for purpose, but also designed to meet all our users’ needs. We also recognize that we have a huge responsibility to ensure that the job seekers and youth that visit our platform and engage with us have the skills to fill the jobs advertised on our platform. For this reason we have invested heavily in our Youth Engagement & Learning efforts to equip the youth of Nigeria for the

https://www.facebook.com/businessdayng

berman? How do you utilize your own tech to discover the best and brightest talent? To begin with, all our open roles are advertised on our platform with an assessments listing. This ensures that the job is being advertised to a wide pool of talented candidates. The assessment then helps us to efficiently do an initial shortlist based on skill set. Shortlisted candidates then go through various stages with key stakeholders within our organization. The key here is that we ensure that anyone coming into our organization is not just a culture fit, but also a ‘culture add’, in the sense that anyone coming in should be bringing the skills and behaviours that we have already identified as critical for our future. For example, a question I typically ask is for candidates to give an example of efforts they have taken towards their self-development in the past 3 months because we focus on self-driven continuous improvement at Jobberman. What is your favourite Jobberman product add-on for employers? This would definitely be the Assessment product. The assessment product is one of my favourite Jobberman products because it is designed for the future of work. Modern-day recruitment literature suggests that to be best placed for the future of work, companies should be assessing the critical skills their organizations need to have the right competitive advantage. This implies that to hire right, companies will need to hire candidates who have the critical skills that have been identified for the business. This is where our assessment product comes in; by using an assessment you can immediately see what skills the applicants have and at what level because the assessment report shows you the level of proficiency the candidate has based on their answers. What do you wish more HR professionals and recruiters knew about recruiting? My first wish would be for HR professionals and Hiring Managers alike - there is no perfect candidate. It is important that when you are looking for a candidate you know exactly which areas you are willing to compromise on for different roles without disqualifying candidates who have potential but don’t tick all the boxes. My second wish that I would like all HR professionals @Businessdayng

and recruiters to know is that recruitment is an art not a science; there is no one size fits all recipe for recruiting for all roles across various organisations. What this means is that you might need to tailor your recruitment strategy for each open role in your organization to ensure that you are getting the best fit. Industry analysts have said that recruitment will be driven through a mix of human and automated solutions. Do you agree? Also, what are the challenges in the recruitment industry that need urgent attention? I definitely agree with this. Artificial intelligence will probably ensure that in a few years only the final stage of the recruitment process is done by a human being. The current challenge I see in the recruitment industry that needs urgent attention is discrimination based on age and less explicit discrimination targeted at candidates who have career gaps on their CV. This discrimination automatically excludes some candidates in the labour market eg women on extended maternity leave or workers who had to take extended sick leave for example. Recruitment needs to leave this bias behind as we progress towards a focus on hiring for the right fit based on skill and ability, not the notion of what the right candidate looks like on paper. What should Nigerian job seekers and employers be looking out for with Jobberman? Our job seekers and employers should look out for our ongoing Soft Skills training and our upcoming virtual career fair happening in September. Soft Skills have been shown to be the skills of the future of work. Soft skills, commonly defined as non-technical skills, enable individuals to interact effectively with others. According to the World Economic Forum, to succeed in the workplace everyone needs to have a good grasp of soft-sKills because these skills are vital to organizations and can impact culture, mindsets, attitudes, and behaviours. The purpose of Jobberman’s Soft Skills training is to equip job seekers with the skills and tools needed to succeed in the workplace during and post-CoVID-19. Secondly, we have our upcoming Virtual Career Fair happening on September 30th, 2020. The career fair is really a chance for us to showcase the various opportunities open to active job seekers.

Tuesday 25 August 2020

BUSINESS DAY

Investments

ENERGY INTELLIGENCE

Market Insight Companies Commodity Tracker Policy

OIL

GAS

PETROCHEMICALS

POWER

Should a deregulated downstream sector continue to have petroleum equalisation fund? DIPO OLADEHINDE

he inability to maintain equal p r i c e f o r p etrol across the country despite forced removal of subsidy and Nigerians paying billions has put to questioning the continuous relevance of the Petroleum Equalisation Fund. First established in 1975, the PEF strives to equalise petrol and kerosene prices in Nigeria by paying petroleum product marketers for every litre of fuel, they sell within 100km to 450km of a depot. The fund is effectively a cross-subsidy as marketers who sell within 100km of a depot pay in contributions. L i ke o t h e r o b s o l e t e laws in the sector, fresh agitations have greeted the scheme, following forced removal of subsidy in the last four months as marketers of the product and other stakeholders have insisted that the fund is a drainpipe

and not needed in a market expected to survive on realities. For instance, while the official pump price of petrol was N143 per litre in July, however, data provided by the National Bureau of Statistics (NBS) revealed that the country was unable to keep to uniform price as petrol was sold in Adamawa State for N145.00, Abia State for N144.93 and Enugu State for N144.80. The development de-

feated the reasons for setting up PEF as NBS further disclosed that the products sold lower in states like Gombe for N142.57; Ogun for N140.30; and Gombe for N142.57. While br idging cost floats between N6 and N10, the monthly pricing template released by Petroleum Products Pricing Regulatory Agency (PPPRA), dated June 30, showed that Nigerians were charged N7.51 as additional cost

from the core variables that determined how much should be paid on a litre of petrol. Which implies for every litre of petrol consumed in June, Nigerians pay a total of N12.0 billion with an average daily petrol consumption of 52 million litres. “PEF’s price-setting is not compatible with a liberalised downstream petroleum sector,” a source familiar with the matter

says. According to him, “allowing a government body administer equalisation fund will create a rentseeking opportunity for a gatekeeper which can easily lead to fraud.” Former President, Nigerian Association for Energy Economists (NAEE), Wunmi Iledare, stated that the country could not pretend to deregulate and set the price at the same time, nor keep an equalisation agency. “This is what we refer to as transfer payment syndrome. The way out is complex but doable,” Iledare said. Another expert with the Facility for Oil Sector Transparency and Reform (FOSTER), Michael Faniran, says the muchtalked about deregulation was not holistic. “With prices now fully deregulated, PEF has been overtaken by the recent development, although it might require appropri-

ate legislation to scrap the agency,” Luqman Agboola, head of energy and Infrastructure at Sofidam Capital said. Other stakeholders believe the PEF has either outlived its usefulness or at best, should be made to be an arm of a parastatal, under the Ministry of Petroleum Resources. Some are quick to allude to the Oronsaye Report, which recommends a merger of the PEF with the PPPRA. However, some say PEF logic seems reasonable, as petrol and kerosene are important for economic activity, uniform prices should help to level the playing field for economic growth in all areas of the country. Last month, the Independent Petroleum Marketers Association of Nigeria warned against any proposed plans to scrap the PEF, saying Nigerians in many parts of the country would be forced to buy petroleum products for as much as N400 a litre.

Explainer: Here is what aligning with OPEC+ production cut means for Nigeria Africa needs a strategy for successful energy transition -experts STEPHEN ONYEKWELU

n August and September, Nigeria will cut oil production by over two hundred thousand barrels per day to compensate for overshooting the country’s OPEC+ allotted production quota. According to data cited by the Nigerian National Petroleum Corporation from the Ministry of Petroleum Resources, Nigeria’s crude production stood at 1.61 million barrels per day in May, a full 200,000 bd above its May-June OPEC+ 1.41mn bd output quota. However, as of early August, Timipre Sylva told Energy Intelligence in an interview that Nigeria is currently producing a little over 1.3 million barrels per day. “We agreed according to the plan that we were going to cut (an additional) 45,000 b/d in July and we have actually done more than that. And in August we are expected to cut 114,000 b/d. In September, another 114,000 b/d,” Sylva said. Both the $40 per barrel and 1.3 million barrels per day of oil are suboptimal and leave Ni-

geria exposed to external shocks. Sylva estimated that the optimal price and volume for Nigeria will be “2 million barrels per day at $70 per barrel.” Why is this so? Nigeria is more of crude sales than an oil and gas economy. There is no viable downstream sector and the midstream hardly exists. This explains why the oil and gas sector accounts for less than 10 percent of the gross domestic product (GDP) but 65 percent of government revenue and at least 90 percent of foreign exchange. With Brent crude oil price averaging $40 per barrel and Nigeria producing 1.3 million barrels per day, there will be a shortage of foreign exchange because there is no accretion to the reserves. This means the Central Bank of Nigeria’s ability to defend the naira will be challenged. Nigeria’s foreign reserve fell from $36.57 billion in June 1st, 2020 to $36.12 billion on July 15th, 2020. Already, some banks have sent out notifications to their customers www.businessday.ng

informing them that the maximum expenditure on their dollar MasterCard is $100 per month, a sign of dollar liquidity crisis. Nigeria doesn’t have the buffers it did in 2008 to shrug off an oil-induced global recession, leaving the economy more vulnerable to a fiscal and monetary crisis this time around. This is an incentive for Africa’s biggest oil producer to comply with OPEC+ production cuts. “In the last 40 years, Nigeria has depended on oil and gas as a major source of earnings for its revenue account, stabilisation of the currency and to promote and diversify the economy,” Ademola Henry Adigun, team lead, Facility for Oil Sector Transformation said. “But Nigeria has mismanaged the oil and gas sector is currently in a mess.” Nigeria has long had a reputation for poor compliance with OPEC and OPEC+ production cuts, but it has gradually been showing greater discipline since the latest round of deep cuts was announced in April.

lthough it has 8 per cent of global population, Africa ranks the lowest in terms of per capita electricity access hence experts are calling for a sustainable strategy to manage energy transition across the continent. Speaking at a webinar organised by The Energy Intelligence, a Lagos based energy media consultancy, Hannah Kabir, CEO, Creeds Energy Ltd said the lack of access to energy has made businesses resort to “using backup fuel generators which is estimated at about 15 gigawatt capacity with high socioeconomic cost across households, businesses and communities. Echoing her, Patrick Tolani, CEO, Community Energy Social Enterprise Ltd, said, “affordability is the greatest challenge that all the industry players are faced with. The report recently released by the National Bureau of Statistics indicates that 27.1 per cent is the rate of unemployment compared with 3.9 per cent in the UK meaning that about 21.7 million Nigerians are unemployed. When such huge number

https://www.facebook.com/businessdayng

is staring us in the face and the rate of inflation is rising, what that means is that whilst the cost of delivery of project is surging, the people’s purchasing power is reducing because they are getting into unemployment and so they are not able to buy your products. In the face of this, there is import duty in Solar products plus increase in VAT on solar products presenting a dilemma. While there are lots of intervention programs, they are not supportive of each other. We need to figure out how to have inclusive development which is not the case in Nigeria today,” he noted. In his remarks, Dayo Adeshina, Program Manager, LPG Expansion Plan, Office of the Vice President said the government has put in place several incentives to ensure the success of the LPG value chain. According to him, “We started by looking at the 4 As: Acessibility, acceptability, availability and affordability at the LPG Expansion program. One of the first things we did was to look at the anomaly in the sector where LPG was the only petroleum product subjected to VAT @Businessdayng

and this had a huge impact on the price. So we had to remove that. There was also a presidential waiver on LPG equipment. We set ourselves a target of 5 million tonnes over a 10 year period. A key aspect the government realizes is that there is a need for cylinders if you are going to have maximum penetration especially in the rural areas. So one of the key aspects of the Expansion plan is the Cylinder Injection Scheme coupled with the stimulation of investment in cylinder manufacturing and also cylinder recertification and requalification. Speaking on the Nuclear energy industry, Ryan Collyer, Acting CEO, Rosatom Central and Southern Africa said the region needs to go beyond trying to give every single person access to electricity and focus on industrialization. “In order to industrialize, we need masses of baseload power. At this point, I need to say that Africa should not only build nuclear. We have a Wind company called SC Nova Wind. We believe Nuclear with renewable is the future of the global energy industry.

Tuesday 25 August 2020

BUSINESS DAY

INSIGHT

What you need to know about Forensic Audit Adeleke Emmanuel Divergent public expectation of conventional audit ore often than not, the public usually expect that auditors of financial statements should know everything that has transpired including evidence of any fraud committed, imminent insolvency and corporate failures of the auditee. In the expectation of the society, the auditor’s expertise is linked with fraud detection and fraud deterrence. Thus, auditor’s credibility has often been questioned and the auditor widely criticized where these expectations are not met notwithstanding that they are outside the scope of the conventional auditors’ duties and standard of practice. It appears that majority of the interest groups have little or no knowledge of the duties and limitations of conventional audit, as well the objectives and requirements. The general expectations of the society from an auditor are commonly covered under a different field of accounting and auditing called Forensic Accounting, or Auditing/ Investigation.

Distinguishing conventional audit from forensic audit There is no doubt that both conventional and forensic audits are examinations conducted retrospectively. However, the objective, focus and outcome are not the same. The objective of conventional audit is to form an independent opinion on the overall financial statements taken as a whole. The conventional auditor’s opinion is to add credibility to the financial information reported by the auditee in the eyes of its users or interest groups. Auditors are guided by standards of practice that require them to maintain professional scepticism while performing their audit work of inquiring, making observations, examinations and re-performance of accounting transactions of the sample selected to obtain evidence that will give reasonable assurance of the audit assertions. The conventional auditor only seeks to ensure that the financial statements are free from material misstatements caused by either error or by fraud; and where they exist, cause management to correct the material misstatements before they are issued for users; otherwise he qualifies his opinion to put users on notice or at alert. However, the real work/ science of detection,

deterring and investigating fraud, financial scandals, improprieties and providing remedial actions including litigation support to deter reoccurrence in in the future is covered under forensic audit or investigation. Definition of forensic audit There are many definitions of forensic auditing, accounting or investigation. The word forensic in its elementary use itself simply means the “use of scientific methods to solve crimes”. The use of forensic is not limited to accounting or auditing alone. There are many areas of forensic specializations. In the field of medicine, much of forensic investigation is about trying to determine how and when a corpse died which we popularly refer to as autopsy. On the other hand, forensic in engineering try to find out what went wrong with a structure or machine. Therefore, a very simple definition of forensic audit can be taken as “a methodical application of accounting, auditing and investigative skills to analyse and evaluate financial and non-financial data to obtain evidences that are suitable to answer the questions who, what, when, where, how and why of any improprieties that are suspected or known to have been committed”. Dire need for forensic auditing There is no doubt that nobody wants to be duped or cheated. Even the thief does not want the booty of his illicit acts stolen. He equally wants to retain what he has stolen from others and will want to prevent it from being re-stolen from him. This www.businessday.ng

would suggest that everyone may need forensic auditing. In recent years, public outcry and anger over occurrences of massive fraud and corrupt practices in governments and corporations have led to the establishment of special crime detection and deterrence institutions; new legislations, new corporate codes of conducts, new auditing and reporting standards, new accounting standards, regulatory oversights and stiffer penalties for conspiracy, commission or concealment of fraud and corrupt practices. However, while some prosecutions have been successful, a lot of prosecutions involving mindboggling amounts/values have failed because of lack of evidence on the part of the prosecutors to ensure conviction of the culprit(s). It is a known

principle that criminal conviction can only be founded on Proof Beyond Reasonable Doubt. Also, the Blackstone’s ratio states that “it is better that ten guilty persons escape than that one innocent person suffers”. This presupposes that a high level of substantial evidence is required o convict a suspect of a crime. It is apparent that prosecutors most times rush to court with little or no evidence to procure convictions and the suspect ends up walking home tall even when there are apparent gaps between resources expended and value obtained. This is where forensic auditing becomes relevant to find the missing link, identify what had depleted the value addition and reconcile the gaps with verifiable evidence that can provide support for litigation and other remedial actions.

Forensic audit follows a multi-staged process similar to normal audit process but its aim, objective, focus and extent of work done by forensic auditors are not the same with traditional or conventional auditors

The Process of forensic audit Forensic audit follows a multistaged process similar to normal audit process but its aim, objective, focus and extent of work done by forensic auditors are not the same with traditional or conventional auditors. The process of a forensic audit can be represented diagrammatically as follows: The outcome of forensic auditing should either documentarily or in testimonial form detail amongst others: who committed the crime? What is the very nature of the crime committed? What evidence is available and what will deter reoccurrence? When was the crime committed? Where was the crime committed and where was the proceeds kept? How was the crime committed and how much resource/value is involved? Why

‘

https://www.facebook.com/businessdayng

@Businessdayng

was it possible for the culprit to commit the crime? Deciding for forensic audit today! The outcome of a forensic audit is neither to reach nor to express a general opinion about fair representation of financial statements of the auditee as is the case with a conventional audit process. In forensic auditing, the auditor assesses and measures financial losses and other forms of damages that the auditee has suffered. The scope of work is neither based on sampling technique nor materiality concepts. The forensic auditors seek for all relevant evidences and examine them in details. The forensic report is based on factual information which could either be documentary or testimonial and can be used in litigation proceedings in criminal actions against the culprit. Recommendations from forensic audit could include changes to internal processes, policies, personnel and preventive or deterrence actions against future reoccurrence of identified improprieties. With the spate of financial scandals, corporate failures, changes in value systems and misplaced economic priorities all over the world, and in Nigeria in particular, there is no economic unit that does not need to undergo forensic audit today. You will be surprised of what the outcome of your forensic audit will reveal if your organisation (NGO, company or Parastatal) decide to undergo a forensic audit today. Adeleke Emmanuel, FCA Partner/Forensic Audit Ijewere & Co.

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

NEWS

Lawmakers summon Sanwo-Olu’s chief of staff, others over security helicopters INIOBONG IWOK

he Lagos State House of Assembly has summoned Tayo Ayinde, the chief of staff to Governor Babajide Sanwoolu, over the whereabouts of the three security helicopters belonging to the state government. Also summoned by the lawmakers are the state commissioner for economic planning and budget, commissioner for special duties, as well as the management of the Lagos State Security Trust Fund (LSSTF). Raising the issue under matter of urgent public importance during plenary on Monday, the chief whip of the house, Mojisola Miranda stated that the offices and MDAs in-charge of the helicopters should be written to and the assembly should know the agreement between the state government and Caverton Helicopters which is said to be managing the helicopters. According to her, “If you may recall, in 2007, the House of Assembly passed a bill for the establishment of the Lagos State Security Trust Fund (LSSTF) for the state government to equip and strengthen the security agencies in the state. “The helicopters were bought under the administrations of two past governors- Babatunde Fashola and Akinwunmi Ambode to strengthen security in the

state. But, the helicopters are nowhere to be found now. “I will want us to look at it and get the concerned parties to tell the house the location of the three helicopters to see if they are just lying fallow or if the state government has entered into an agreement with an entity on them and see to what extent the agreement has been working”. The speaker of the house, Mudashiru Obasa pointed out that the helicopters were meant for both for security and commercial purposes. Obasa said there was the need for the lawmakers to know what has so far accrued to the state government from the helicopter, saying that this was the first time the assembly would be talking about the helicopters. “What we have said so far has nothing to do with the image of the state or the assembly. What the chief whip has done is not too much. We need to know what has happened to the helicopters,” he said. Contributing, Rotimi Olowo (Shomolu 1) said a commissioner had informed the house that they had an agreement with Caverton Nigeria Limited to operate the helicopters so that the state government would make some money from the operations. He noted that it was important to know how the helicopters are being managed so far and where the money is going.

Aminu Ado Bayero (l), emir of Kano, speaking with Nasir Wada, Magajin Gari Kano, at the closing ceremony of the Gold Durbar Kano at Ado Bayero Mall in Kano.

CBN moves to forestall overpricing of imported goods with new mechanism HOPE MOSES-ASHIKE

… may address issue of over-invoicing - analyst

entral Bank of Nigeria (CBN) will be introducing a new pricing device known as Price Verification Mechanism (PVM) to forestall over-pricing and / or mispricing of goods and services imported into the country, Nnaji O.S, director, trade and exchange department, CBN, said in a circular on Monday. The new pricing mechanism, which takes immediate effect, is in line with best practices around the world. The CBN also directed all authorised dealers to desist from opening of Forms M whose payment are routed through a buying company/ agent or any other third par-

ties. “It may truly help to check over-invoicing approach of companies,” according to analyst last night. For instance, analysts say if XXX Nigeria buys raw materials through XXX Dubai that would have marked it up. Though they argue it is to get volume discount, but the worse is that some “Indian and Chinese” companies buy from their sister companies at serious marked-up price. They would set up a non-operating entity that would be the purchasing agent for the Nigerian entity, with serious invoicing consequences. “It helps to accelerate capital repatriation, make them look like loss-making

Abia SMEs need capital not tax waiver - stakeholders GODFREY OFURUM, Aba

ntrepreneurs in Aba, the commercial hub of Abia State, have said that the economic impact of Covid-19 on small businesses goes beyond whatever reliefs that the tax discounts/ waivers, recently announced by the state government were intended to achieve. The Abia State board of internal revenue (BIR) on Monday, July 20, 2020, announced tax reliefs to residents of the state, to mitigate the economic impact of the Covid-19 pandemic. Agbara Celestine, acting chairman/chief executive, Abia BIR, had announced that small scale industries/ artisans (PAYE and all forms of personal income taxes/ direct taxes), who make payment for past three years arrears, would enjoy 25 percent waiver/discount for payment till end of July, 2020; 20 percent waiver/discount for payments in August, 2020 and 15 percent waiver/discount for payments in September, 2020. But speaking, Imo Anasonye, chairman, Nigerian Association of Small Scale Industrialists (NASSI), Abia State,

noted that “with the tax waiver, the government assumed that small businesses still have capacity to pay taxes. This is erroneous”. He explained that most small businesses have totally lost their operating capitals and therefore need far-reaching interventions, to resume operations again and thrive. He suggested that the state government should give 24-month tax holiday to small businesses and working capital of N1 million each, to 1,000 small businesses in the state, which could come in form of grants or cheap loans and channelled through the SME associations in the state. He appealed to the state government to also upscale basic infrastructure and ensure an atmosphere conducive for business growth and development, devoid of touting, multiple taxation and other negative activities of government or claimed government agencies/agents. Darlington Kalu, president general, African Association of Small and Medium Enterprises (AASME), also appealed to Governor Okezie Ikpeazu, to set aside 15 percent of the www.businessday.ng

total budget of the state, as a pool fund to cushion the effect of Covid-19 on MSME in the state. He argued that businesses needed to be revived for the government and its agencies to collect taxes and levies for economic development. According to him, “We will not accept the taxes and levies as stated, by the board of internal revenue (BIR), which started in July, 2020, while we are still at the peak of Covid-19 pandemic. He urged the state government to shift the implementation of the tax waiver to the first quarter of 2021. “Moreover, we will demand detailed analysis on how the BIR arrived at the formula,” just as he decried the way the BIR staff and agents carry out their tax drive in the state, especially in Aba. “BIR agents/staff are not civil in the discharge of their duties within Aba, where they harass and intimidate residents and patrons in the commercial city. We believe that taxes and levies are government moneys and so professionals with sound mind, should be given the responsibility to collect such taxes and levies for the government and not touts.

entity or reduce their margin without having to pay tax or at least pay less tax. In the end, they have taken out their equity and only working with Nigerian banks’ loan. So, even if the business fails, the equity was really not there... they have since taken out multiples of it through invoice,” an analyst told BusinessDay. The new development is part of regulator’s continued efforts to ensure prudent use of the nation’s foreign exchange resources and eliminate incidences of over-invoicing, transfer pricing, double handling charges, and avoidable costs that are ultimately passed to the average Nigerian consumers.

The circular to all authorised dealers and general public on ‘Destination Payment for All Forms M, Letters of Credit and Other Forms of Payment,’ was dated August 24, 2020. Continuing, the analyst said, “It is just the timing and aggression with which it is done and the fact that their purported process will slow down Forms M processing, it is not completely out of place, in my view. It is the same pattern of CBN trying to do everything with monetary/FX policy. “There are serious transfer pricing issues that go on for sure. But using Forms M and FX policy to tackle that creates more problems than it ‘cures.’”

COVID-19 plunged air transport by 57% in Q2 2020 – NBS IFEOMA OKEKE

ational Bureau of Statistics (NBS) has released growth figures of Gross Domestic Products (GDP) for air transport showing a deep contraction of 57.38 percent in Q2 2020 from 5.68 percent in Q1 2020 and 12.31 percent in Q2 2019. According to NBS, the decline was largely attributable to significantly lower levels of both domestic and international economic activity during the quarter, which resulted from nationwide shutdown aimed at containing the spread of Covid-19. The domestic efforts ranged from initial restrictions of human and vehicular movement implemented in only a few states to a nationwide curfew and ban on domestic and international travel. The Airline Operators of Nigeria, (AON) during the lockdown disclosed

https://www.facebook.com/businessdayng

that over 120 aircraft were parked at various airports across the country, with airlines required to pay accumulated cost on leased aircraft, staff salaries, allowances for crew, parking and maintenance fees, and recurrent training. AON also estimated N360 billion loss as a result of the impact of Covid-19. Hadi Sirika, minister of aviation, had said that the aviation sector was the most hit by the coronavirus pandemic, saying many airlines may not survive the crisis. According to Sirika, “We are very aware of our responsibilities and the weight attached to this. We are worst hit among all the sectors. Some 17 billion is being lost by the airlines monthly, thanks to Covid-19. The sector is highly regulated and very coordinated and has set standards that must be followed at all times, regardless, because we speak to safety. @Businessdayng

“This is the situation of civil aviation. It is really a pathetic one and I can guarantee you that several airlines won’t come out of this unfortunately.” In a bid cushion the effect of the Covid-19 pandemic, Seyi Adewale, the chief executive officer of Mainstream Cargo Limited suggested that government stimulus led packages and incentives be given to the aviation subsector. These, Adewale said, should include deliberate sourcing, loans, grants, tax waivers, special forex windows and rates, airport infrastructure, and reduction of airport taxes or surcharges. He stated that locally and in Nigeria, the government can consider expanding the definition of aircraft spare parts to include other important aircraft items such as brake ASSY, safety appliances, rafts, and aircraft tyres in order to enjoy zero percent duty waivers.

Tuesday 25 August 2020

BUSINESS DAY

NEWS

Federation account over stretched- RMAFC CYNTHIA EGBOBOH, Abuja

he Revenue Mobilization Allocation and Fiscal Commission (RMAFC) said on Monday that demands by the three tiers of government has placed undue pressure on the federation account, stressing the need for state governments to develop strategies to boost their internal revenues. Elias Mbam, chairman of the commission, receiving the Annual States Viability Index (ASVI) from the editor-in-chief of the Economic Confidential, Yushau Shuaib in his office in Abuja, noted that the federation account allocation is overstretched by the over-dependence of the tiers of government, hence the need for state governments to look at other income sources. “The over-dependence in

the monthly federation account allocation has made it imperative “for state governments to boost their internally generated revenues (IGR)”. “The annual ASVI report apart from providing a good source of information to the general public also has been identified as a source of information that would drive RMAFC on its mandate to encourage states of the federation to improve their internally generated revenue”. Speaking on the report, the editor-in-chief of the Economic Confidential, Yushau Shuaib said the ASVI report assessed and ranked states by their annual IGR in comparison to their receipts from the federation account. He said the report has shown that without the monthly disbursement from the federation account, many states cannot survive

as the indices showed that seven states are insolvent due to very poor IGR that were far below 10 percent of their receipts from the federation account. “Apart from Lagos and Ogun States that ranked high in the revenue generation in 2019, more states have recorded impressive and encouraging IGR in 2019 compared to 2018. The report shows that only Rivers, Kaduna, Enugu, Kwara and Zamfara States did well with regards to impressive revenue generation in 2019 compared to their IGR in the previous year 2018 by improving more than 10 percent. “The states with the worst IGR performance in 2019 thus rendering them insolvent according to the report are Katsina, Kebbi, Borno, Bayelsa and Taraba States “with extremely poor IGR”.

Lagos invites private sector partners to manage Imota rice mill CALEB OJEWALE

agos State government has invited what it calls strategic partners that will manage and operate the 32 metric tonne per hour Imota Rice Mill in Ikorodu area of the state. An Expression of Interest (EOI) notice by the state’s ministry of agriculture, invited both domestic and international firms or consortium of firms to submit am EOI to enter into a strategic partnership to manage, operate and maintain the rice mill with a medium-term vision to securing equity ownership. According to the no-

tice signed by Abisola Olusanya, acting commissioner for agriculture, the rice mill complex sits on 22 hectares of land, with the core mill capacity of about 8.5ha consisting of complete sets of twin milling lines, two (2) product warehouses, 16 paddy storage silos with capacity of 2,500MT each, water treatment plant and effluent processing plant. The mill, government says is meant to bridge the supply gap of rice in the state, ensure food security, reduce dependency on rice importation, as well as create over 250,000 direct and indirect jobs through the rice production value chain.

It was also stated that the state government is already exploring partnerships with key paddy producing states to secure paddy for the Imota Rice Mill. Submission of expression of interest, according to the notice, should be submitted no later than 5pm on September 6, 2020. The notice requires prospective applicants to register with the Lagos State Public Procurement Agency (PPA), provide company profile detailing information such as ownership and organisations structure, experience with similar projects in size and scope; evidence of financing and access to credit among others.

2020 Connect Nigeria Business Fair will be more exciting- organisers MICHAEL ANI

onnect Nigeria, a leading information portal and business service provider, is set hold its 2020 edition of the “Connect Nigeria Business Fair” We are bringing Africa’s most anticipated business event to you, anywhere you are. All you need is an internet-enabled device and you are connected from wherever you are in the world. 2020 vision has been repackaged and it is going to be exciting, bigger, and better,” said Emeka Okafor, managing director of Nigeria Connect. Okafor, who addressed a virtual press conference on Monday, said that the business fair slated for August 27 and 28, added that “the experience this

time will be a virtual one.” This 8th edition of the fair, according to him, will provide a roadmap for business owners to learn and thrive, as there will be panel sessions with captains of industry such as Toki Mabogunje, president of Lagos Chamber of Commerce and Industry, Henrietta Onwuegbuzie of Lagos Business School, Tunde Coker of Rack Centre, Fela Durotoye of Gemstone Consulting, Ubong King of Protection Plus, representative of Allianz Insurance, Union Bank, Stanbic IBTC, First Bank, Sigma Pensions among others. “There will be masterclasses, networking, exhibitions from brands like logos.ng, Price Pally, and Lucy.NG and more. This is aimed at helping entrepreneurs to see clearly and enwww.businessday.ng

courage a holistic view of businesses in order to take considerate steps towards success,” Okafor said. Connect Nigeria is an advocate of building strong businesses and through its annual business fair, is on a mission to empower at least one million Nigerian businesses. He added that that fair was being organised in partnership with Creno8, Dochase, Founders Institute, LBS, and LCCI and promises to be worth your while and not to be missed. The 2020 vision is supported by organisations such as Aiteo, NIRSAL, Allianz, First Bank, Union Bank, Carbon, Air France KLM, Stanbic IBTC, Sigma Pensions, Hot FM, Rave TV, and Page Financials, and is free to attend but participants expected to register. https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

POLITICS & POLICY

Edo guber: PDP, APC bicker over alleged plot to rig election Idris Umar Momoh, Benin

s the September 19 Edo State gubernatorial election draws closer, the People’s Democratic Party (PDP) last Sunday alleged that it had uncovered plot by the All Progressives Congress (APC) to rig the election with fake results. Chris Nehikhare, Edo State publicity secretary of the party, made the allegation at a press conference in Benin City. He alleged that the Hope Uzodinma template was that the APC would write fake results in a hotel and smuggle in the result at the collation centres. Governor of Imo State, Hope Uzodinma is the deputy chairman of the APC National Campaign Council for the Edo State gubernatorial election. Nehikhare further alleged that if it was not possible for the party to achieve its mission at the collation centres, they would disrupt the election process in some wards and units and thereafter, present the results at the election tribunal. The state PDP scribe, who said the plot had been nipped in the bud, opined that Godwin Obaseki would

Godwin Obaseki

Osagie Ize-Iyamu

win the election with a landslide. “We have uncovered a sinister plot which APC termed the ‘Uzodima template’; they are trying to use the template during the September 19 governorship election. “The template is that they will be in possession of fake result sheets, then they will disrupt election in various polling units across the state during the election; they will move to their hotels, write results and will submit them at the point of collation

or at the tribunal the way they did in Imo State,” he said. He said the press conference was to alert the world, Edo people and the Independent National Electoral Commission (INEC) of the plot by the APC during the election. Nehikhare, who commended the people of Edo North and Edo Central senatorial districts for the warm receptions and support accorded the party’s candidate, Governor Godwin Obaseki and the campaign team,

I have no third term agenda, says Emmanuel Aniefiok Udonquak, Uyo

overnor Udom Emmanuel of Akwa Ibom State has denied having any ambition for a third term through a surrogate when his second term expires in 2023. The governor said he would not continue in office for a third term through any surrogate. Speaking in Uyo, the state capital, during an interactive session with the people, Emmanuel promised he would not allow any cultist to take over the reins of governance from him in 2023. According to him, “For peace to reign and for Christ to have control, I am not interested in third term through a surrogate; the only thing you can help do is to ensure that no cultist is allowed to emerge governor of the state. “Some council areas are highly volatile; so, if they nominate a cultist we would not permit such. Any cultist arrested would not be released”. The governor further said: “The only way to ensure peace is to make a way to eradicate cultism if you want to ensure peace. We look up to God; then we embrace peace. Some cult groups are clashing in some parts of the state and we have tried to make sure we crush them. “We will stop at nothing in ensuring we crush them. It is not our intention to deploy soldiers to volatile areas and you are forcing us to do so. Please let parents talk to their children, they gain nothing from

cultism. It can’t be because of one man the whole village would run away. It is time to go their right way.” Governor Emmanuel, who also explained why he is opening up more internal roads in Akwa Ibom State, said it was to allow for ease of transportation and movement of goods and services. He admitted that the lockdown caused by Covid-19 had affected the completion time of the projects but stated emphatically that the roads would be completed in good time as government and governance is a continuum. He maintained that the intervention of his administration in every sector of the state was wholesale, assuring that all issues of pensions and gratuities will surely be given the rapid attention they are presently receiving. Emmanuel, who challenged the protocol and parameters used by the National Bureau of statistics to rank the state as the second largest in terms of unemployment, said he should be spared any distraction from NBS. According to the governor, “We were the second in foreign direct investment, every part of the state is a construction site; what do people call employment? I inherited 100+ doctors and today we have over 400. I attribute this to ignorance. “In terms of investment in agriculture, our target was 16,000 hectares, the coconut plantation is employing up to 400 people. Find out people in hospitality businesses, and none employs less than 250. www.businessday.ng

assured that the governor would execute more people-orientated projects in the districts if re-elected for a second term. He particularly commended the royal fathers for their prayers, endorsement, words of encouragement and support. “We want to thank the people of Edo central for the wonderful receptions they gave to our governor and campaign team when they visited during the ward-to-ward campaign in the senatorial district. “The 54 wards of Edo central have been successfully completed. We visited the Enojies, commissioned several projects that have been done by this government and I think to the disappointment of our opponent they were surprised to see even the Enojie of Irrua, reel out projects that were built and commissioned in his domain. “I believe this is the hallmark of our government. We are not noise makers but silent achievers. We have done uncommon good in terms of project execution across the three senatorial,” he said. According to him, “What happened in Edo central was unprecedented, the crowd, orderliness, the reception, jubilations and remarks not just from the royal fathers but for

the people of Esanland that received and guaranteed us of massive votes from the senatorial district. “I want to say here that the trust and confidence reposed in us, this government will do even more when it comes for a second term.” He also thanked members of the press for good and balanced reportage of the governor’s ward-to-ward campaigns so far in the two senatorial districts. He appealed for the same good reportage during the ward-to-ward campaigns in Edo South central district billed to commence Tuesday 25, 2020. Reacting, Chairman, Edo State APC Media Campaign Council, John Mayaki described the allegations as baseless and unfounded. While insisting that Edo electorate will vote out Obaseki and not by rigging, he added that the governor was only disclosing what he and other PDP governors have perfected to execute during the election. “It is on record where Obaseki boasted that only him and his deputy have monopoly of rigging and maiming because they have immunity. So, they are only rehearsing their evil plots seeing that Edo electorate has rejected them,” Mayaki said.

PDP screens aspirants for Lagos East, Kosofe constituency by-election ...Four aspirants eye senatorial seat, two jostle for Kosofe Iniobong Iwok

head of the October 31 scheduled by-election, the Lagos State chapter of the People’s Democratic Party (PDP) would on Tuesday hold its screening exercise. The party also disclosed that six aspirants have so far collected and returned their nomination forms

for both elections. The 5-member screening committee put together by the party’s national headquarters headed by Tajudeen Ayo Yusuff will commence the exercise by 10am at the PDP state secretariat, Adekunle Fajuyi Way, Ikeja GRA, as directed, BusinessDay has learnt. Spokesperson of PDP in the state, Taofik Gani told BusinessDay, Monday, that four aspirants

have obtained nomination form for the senatorial contest, while two aspirants have so far obtained nomination form for the vacant seat of Kosofe Constituency II. The by-elections are necessitated by the demise of the senator that represented Lagos East senatorial district, Adebayo Oshinowo and the member that represented Kosofe state House of Assembly, Tunde Buraimoh.

Northern governors celebrate Sokoto Sultan at 64 BENJAMIN AGESAN, Makurdi

he Northern Governors’ Forum has joined family, friends, associates and the entire nation in felicitating with his Eminence, the Sultan of Sokoto, Muhammad Sa’ad Abubakar III on his 64th birthday. In a statement, Chairman of the Forum and Governor of Plateau State, Simon Bako Lalong said this special day brings along recollections of the great achievements of the Sultan over the years, particularly in promoting peace, unity and development of Nigeria. “You have remained a great advocate of good governance, peaceful coexistence and accountable leadership which explain your

https://www.facebook.com/businessdayng

Simon Lalong

consistent support and wise counsel particularly to governors of the Northern region and the country at large. We are proud of your advocacy and support towards tackling the challenges of the region as you remain a source of inspiration to @Businessdayng

the Northern Governors Forum,” Lalong said. He further said the Forum has drawn a lot of support from the royal father in areas of addressing insecurity, poverty, illiteracy as well as ending the Almajiri phenomenon which had defied various attempts to end it, until recently when governors of the region took bold steps to return almajirai to their families and also take care of their education and welfare. The Forum, while praying God to grant the monarch good health, more wisdom and divine protection, urged him not to be deterred in availing the nation his wealth of experience and fatherly advice on critical issues that border on the wellbeing of the people.

Tuesday 25 August 2020

BUSINESS DAY

Q2 GDP: The story behind the numbers COMMENT

Who takes the blame for Nigeria’s record contraction in Q2?

LOLADE AKINMURELE

t’s 2020 and the Telecommunication companies that applied for Payment Service Bank (PSB) licenses two years ago are yet to get the nod of the regulator to officially start providing financial services to the millions of Nigerians cut out of their country’s formal financial framework. That’s an indictment on the government in many ways, not least is that it shows the little importance Abuja attaches to boosting economic growth. There’s a strong correlation between high financial inclusion rate and economic growth which should make Nigeria fast track reforms with an eye on boosting growth especially now It’s anyone’s guess why such a transformative reform is stalling in a country where economic growth has been tepid and 38 percent of the population are unbanked. As good as the performance of the Telecommunications sector, which grew the most of any sector after financial services at 15.09 percent, was in Q2, it’s hard not to think what could have been if the Telcos had obtained the PSB license they applied for since 2018 and have rolled out operations. The impact would be huge. Not just in terms of boosting the telecommunication sector’s contribution to GDP but the impact it could have on overall economic growth. Sadly, that’s just one of many reforms that the government has continued to stall on while conveniently hiding behind the COVID-19 pandemic as the chief reason for the economic collapse in 2020. That’s why it will be inaccurate to absolve the government of any wrongdoing and lay the sole blame of Nigeria’s record 6.1 percent contraction in Q2, the worst since 2004, on the COVID-19 pandemic. There are also flaws in taking heart from the poor showing by saying it was better than the decline suffered by other countries dealing with the COVID-19 pandemic. To be fair, Nigeria did better than many expected given that the country also had to deal with an oil price plunge

alongside the crippling economic impact of the COVID19-induced lockdowns in Lagos, Abuja and Ogun, three states that account for over 60 percent of economic output. A contraction of 6.1 percent pales in comparison to the damage wrecked on other economies, but how many have the low hanging fruits that Nigeria does to boost growth. In the past few weeks there has been a flurry of GDP data showing countries posting record contractions in Q2. The US economy contracted by the most since the Great depression of 1930 in the second quarter, after a 32 percent contraction. The UK economy also contracted 20.4 percent in Q2, representing the worst quarterly shrinkage since records began in 1955. Italy and Germany contracted 12.4 percent and 10 percent respectively, as the Eurozone also reeled from the pandemic. Closer to home in Africa, none of the big hitters have released Q2 numbers, however a Reuters poll suggest that the South African economy could contract by 44.5 percent in Q2. These numbers suggest Nigeria is in much better shape than several other countries, a surprise to many who had expected the economy to suffer more than it has. Even the International Monetary Fund (IMF) may not www.businessday.ng

have predicted Nigeria to record such a relatively modest economic contraction in Q2. This is because a reading of -3.96 percent (the average growth rate in Q1 and Q2) in the first six months of the year means the economy must now contract by nearly 8 percent in the second half of the year, about double the decline in the first half to achieve the IMF’s projection for a 5.4 percent contraction this year. A bigger contraction in the second half of the year however looks unrealistic. The global oil price plunge and the COVID-19 pandemic, which forced lockdowns that stifled economic activity, may have taken a bigger toll in the first half of the year compared to a second half where lockdowns have been eased and oil prices have recovered. Perhaps this is why some people have been cheering the better than expected Q2 numbers and have been quick to pull up data showing other countries are faring much worse than Nigeria. That’s however a big distraction for an economy that is now a short crawl away from its second recession in four years. How long the recession will last and what should be done to avert it should be the focus of discussions. Another distraction is laying the dominant blame for the economic plunge at the

feet of the pandemic. To be clear, the pandemic did take a toll on the economy like it did in other parts of the world. However, an evaluation of Nigeria’s macro-economic indicators before the pandemic exposes how the pandemic only made what was already a bad situation worse for the economy. Long before the pandemic started spreading across the globe late last year; Nigeria’s economy had been gasping for breath for five years. Economic growth in Africa’s most populous nation averaged 1.2 percent between 2015 and 2019. Problem with that is the population grew two times faster at an average of 2.6 percent per year. Those five years were a painful squeeze for Nigerians who grew progressively poorer, as economic growth was too slow to create sufficient opportunities for a rapidly rising population. As if Nigeria was not already in a bad place, the COVID-19 pandemic dealt fresh blows to an economy that was always going to struggle, pandemic or not, this year. So let’s not get carried away here. The real question to ask is whether Nigeria contracted by a lower rate compared to other countries, but about whether Nigeria has pulled all the levers that can boost the

https://www.facebook.com/businessdayng

economy at a time when the pandemic has placed additional pressure on the government to reform the economy. Nigeria retains a long list of economic reforms that can unlock economic growth and reduce poverty but have been stuck. Decrepit infrastructure and the lack of a functional rail system means Apapa, which houses Nigeria’s main port, remains a crying shame. When transporting imported goods from Nigeria’s Apapa Port to local warehouses, businesses spend an average cost of $2,050, according to research firm, SBM Intelligence. This is nearly ten times the $208 it costs to transport containers from Durban Harbour to South African warehouses. In Ghana, it costs just $285 to transport containers to local Ghanaian warehouses. There’s still the reluctance to abandon a multiple exchange rate practice that has deterred foreign investment inflows and contributed to an acute dollar shortage that has left several businesses choking. The country is also yet to pass a long-standing Petroleum Industry Bill that is expected to unlock new investments in the oil and gas sector. Cost-reflective electricity tariffs seemed ever so close this year, only to appear far @Businessdayng

away after the same Electricity Distribution companies that had championed the reform blocked it. Nigeria still sits on N180 trillion worth of dead capital trapped mostly in real estate, according to estimates by consulting firm, PriceWaterhouseCoopers (PWC), which the government has not demonstrated any urgency in leveraging. There are the low hanging fruits of privatisation and concessions of redundant government assets that have been on the table for years but have not taken off. The government therefore must take more responsibility rather than hide behind COVID-19 as the main reason the economy contracted deeply in Q2. It’s not the first time that the Nigerian government has tried to hang its failings on factors beyond its control. In 2016, the oil price downturn and production disruptions were fingered as the reason the economy entered a recession for the first time in 25 years. While this is partly true, the government conveniently forgets that its capital controls deployed at the time, which led to a scathing dollar scarcity, contributed to the recession. Good government policies can play a starring role in averting economic turbulence and one just needs to look at how Nigeria didn’t share in a global recession of 2008 that battered several countries. In spite of the debilitating impact of the global crisis, Nigeria’s growth trajectory was not significantly impaired. The real Gross domestic Product (GDP) growth rate which averaged 6.29 per cent between 2004 and 2007 declined marginally to 5.99 per cent in 2008 rising thereafter to 6.9 per cent in 2009. This was attributed to the impressive performance of the non-oil sector, particularly, agriculture and the continuous implementation of sound macroeconomic policies. Truth is when Nigeria does enter recession by the third quarter it would be more because the government failed to implement sound economic reforms and less of a rampaging pandemic.

Tuesday 25 August 2020

BUSINESS DAY

Q2 GDP: The story behind the numbers

Stricter adherence to OPEC cut may worsen oil and gas GDP of - 6.6% DIPO OLADEHINDE

il and gas GDP of -6.6 percent may worsen if Nigeria adhere strictly to its production cut agreement with other major oil-producing countries, a decision which may bite harder on the people in 2020 fiscal year as the federal government adjusts to the realities of dwindling oil revenue. Due to lower oil prices and the partial compliance to Organisation of Petroleum Exporting Countries (OPEC) output cuts, Nigeria’s oil and gas sector recorded a sharp reduction in real GDP by 6.6 percent, according to National Bureau of Statistics (NBS). NBS data also revealed Nigeria had an average daily oil production of 1.81 million barrels per day while oil growth decreased by –11.69percentage points when compared to Q1 2020 which recorded 5.06percent. “The slowdown in the oil sector reflected partial compliance to OPEC output cuts,” analysts at Afrinvest, a Lagosbased investment banking firm said. Africa’s biggest crude producer failed to fully comply with the initial cuts of 1.4 million bpd when the cartel

This chart shows Nigeria’s five best and worst performing sectors in Q2

Source: NBS

reduced production by 9.7 million barrels a day to shore up prices amid the pandemicinduced unprecedented price crash. Compliance from Nigeria stalled at 66 percent, according to July OPEC data, though improved from the 50 percent in May, the first month of the pandemic-related slash in production. “Specifically, we expect the performance in the oil sector to remain downbeat, due to lower oil prices and reduced

production levels in compliance with OPEC+ cuts,” analysts at CSL Stockbrokers said. OPEC has been clamping down on member countries that have been non-compliant with production cut agreements meant to support the market amid pandemic influenced-low oil prices. Nigeria’s full compliance to the OPEC+ deal hangs on a key oil grade being treated as a condensate. Since OPEC+ allowed ultra-light oil to be exempt from

Nigerian farmers expecting big hit from COVID surprised by 1.58% agric growth in Q2 Josephine Okojie

igeria has seen the growth of its agriculture sector slow to 1.58 percent in the second quarter of 2020 owing to disruptions in the food supply chain caused by the COVID-19 pandemic. On a year-on-year basis, the agric sector growth rate decreased marginally by 0.21 percentage points to 1.58 percent in Q2 2020 from 1.79 percent in the second quarter of 2019. On a quarter-on-quarter basis, growth in the sector declined by 0.62percent from 2.2percent growth rate recorded in the first quarter of 2020. The country’s agricultural activities were greatly impacted as the imposition of an initial lockdown to contain the spread of the virus that has infected 52,227 people and claimed the lives of 1,002 people in Africa’s most populous country, obstructed the farming supply system. “We are even surprised that

the sector recorded growth despite the disruptions and difficulties farmers experienced in the last quarter,” said Ibrahim Kabiru, national president, All Farmers Association of Nigeria (AFAN). “The pandemic disrupted farming activities, especially during the initial lockdown when farmers could not access their farmlands nor transport their commodities to where they are needed,” he said. “There was also the issue of insecurity and flash floods. All this affected the agricultural sector, causing growth in the sector to slow,” Kabiru added. He called on the Federal Government to address issues of insecurity and the rising cost of fertilisers in the country, to ensure that farmers carry their planting activities without any form of fear and prevent a further drop in the sectorial growth in the third quarter. Despite the government giving exemption to farmers, food processors, distributors, and retailers from the lockwww.businessday.ng

down measures, farmers were unable to access their farmlands and markets, forcing food prices to escalate. Crop production which has been the main driver of growth in the sector grew at a lower rate of 1.44 percent in q2 2020 from 2.38 percent in q1 2020. The fishing sub-sector grew 2.26percent in the second quarter from 0.63percent recorded in the previous quarter of 2020. The forestry subsector declined from 1.71percent in q1 2020 to 1.08percent in q2 2020. “We were even expecting a lower growth rate because the impact of the pandemic on farming activities and the poultry industry was huge,” said AfricanFarmer Mogaji, chairman-agric group, Lagos Chamber of Commerce and Industry. “This shows that the sector has great potential to transform our economy if we address lingering problems and provided the needed support to farmers,” he said.

its production cut deal, the West African nation’s Agbami has been a bone of contention. The challenge is that nobody from international oil companies to those that monitor OPEC output can agree on whether it should be classed as a crude or not. Nigeria’s oil ministry officials are asking international oil companies like Chevron and Equinor to reclassify Agbami as a condensate rather than a crude, sources close to the matter said last week.

A representative at Nigeria’s oil ministry confirmed Agbami as a condensate, saying the pressure-volume temperature analysis characterization of Agbami’s reservoir fluids prove it is not crude. But the field’s partners are not on the same page. Chevron, which operates the Agbami field and FPSO, have always listed the grade as a crude on their website, and markets it as light, sweet crude oil to its customers. Similarly, equity partner Equinor also classifies the grade as light, sweet crude, according to its website. Trading sources have told S&P Global Platts that the grade is marketed as light, sweet crude, as it is not derived from a gas condensate field. Lagos-based Famfa Oil, which also holds a stake in the oil field, has also termed it as a crude oil on its website. Agbami has an API of over 47.9 degrees and a sulphur content of 0.04 percent, with production ranging between 160,000 b/d and 250,000 b/d in the past 12 months, according to Platts estimates. Agbami is a popular grade among global refiners, and is regularly exported to a wide array of countries like India, Australia, Spain, the Netherlands, China, and Brazil.

It is very similar in quality to Akpo, which is, however, called a condensate by all parties. Ministers of the cartel met last Wednesday to review compliance, during which it was agreed that members such as Nigeria that were pumping above limits in May-July would trim more in August-September as compensation. A combination of lower oil price and lower oil production have often meant Nigeria, Africa’s biggest oil producer, can earn less in foreign exchange and fund its budget deficit. This is because oil accounts for 90 percent of Nigeria’s foreign exchange and 85.6 per cent of Nigeria’s total export. Also, data from NBS also revealed the Oil sector contributed 8.93percent to total real GDP in Q2 2020, down from figures recorded in the corresponding period of 2019 and the preceding quarter, where it contributed 8.98percent and 9.50percent respectively. In q2 2020, average oil production was -0.21mbpd lower than the daily average production of 2.02mbpd recorded in the same quarter of 2019, and –0.26mbpd lower than the first quarter 2020 production volume of 2.07mbpd.

Real estate GDP falls by 21% in Q2, worst in 4yrs ENDURANCE OKAFOR

rowth of Nigeria’s real estate fell sharply to -21.99 percent in the second quarter of 2020, its lowest level since 2016, the National Bureau of Statistics said in the country’s gross domestic product report released, Monday. The measure of the total monetary value of economic activities in the property industry in Q2 was –18.15 percentage points lower than the -3.84 percent growth recorded in the corresponding quarter of 2019, and –16.72 percentage points relative to the -5.27 in Q2 2016. Analysis of the NBS report shows that on a quarter-onquarter basis, the sector declined by –2.71 percent in the review period. According to a Lagos-based real estate consultant, the effect of the coronavirus pandemic on Nigeria’s property market is evident in the second quarter figure by the NBS. “Real estate transactions were partly on a moderate level in Q1 and so there was a slight decline but with the Q2 numbers, it shows that the sector has been largely affected

https://www.facebook.com/businessdayng

especially the commercial arm of the market,” the consultant who asked not to be identified said. Like many other industries, Nigeria’s property sector which is yet to recover from the country’s 2016 recession has been disrupted by the impact of COVID-19 as social distancing, lower oil price and the slowdown in economic activities has halted real estate transactions. According to NBS data, the property market contributed 5.30 percent to the Nigerian economy in the second quarter of 2020. This is lower than the 6.43percent it recorded in the corresponding quarter of 2019. Gripped by the uncertainty created by the coronavirus pandemic, players in Nigeria’s property industry were forced to adopt the wait-and-see position. “We had a client who wanted to buy a property, and we already finalized the process but due to the virus outbreak and currency uncertainty, he said he would want to wait for the next 90 days to watch the market,” Chidi Etoniru, managing partner of Joe Etoniru and Associates, a real estate development company said. @Businessdayng

The outbreak of the rampaging virus also restricted real estate players from going on the field for property inspections, project development and real estate transaction as the Federal Government enforced a 5-week lockdown in Lagos, FCT and Ogun. Meanwhile, before COVID-19 pandemic, access to affordable housing in Nigeria was crippled by among other factors the lack of non-functioning mortgage system, high cost of property development buoyed by the country’s 41 years old Land Use Act. Individual efforts at increasing Nigeria’s real estate properties by way of developing more houses shows offering insights into possible solutions have not helped to reduce the demandsupply gap or increase the ownership level estimated at more than 20 million units. Despite its large-size population, Africa’s largest economy is crawling behind its peers in terms of home ownership level. Whereas home ownership rate is 84 percent in Indonesia, 75 percent in Kenya and 56 percent in South Africa, Nigeria, Africa’s most populous nation has 25 percent.

Tuesday 25 August 2020

BUSINESS DAY

News Ghana’s treatment of Nigerian traders... Continued from page 1

million from each Nigerian trader for the Ghana In-

L-R: Wilfred Odega, NEPZA Zone administrator, Lagos Free Zone; Mu’azu Ruma, NEPZA general manager, Private Zones; Chinju Udora, marketing manager, Lagos Free Zone; Adesoji Adesugba, managing director, Nigerian Export Processing Zones Authority (NEPZA); Dinesh Rathi, CEO, Lagos Free Zone, and Adesuwa Ladoja, legal council/group relationship director, Lekki Port, during Adesoji Adesugba, MD, NEPZA and his team’s visit to Lagos Free Zone in Lagos.

Nigeria now a quarter away from second... Continued from page 1

growth in about three years

when the economy managed to limp out from a lengthy recession in 2016. It is also the deepest contraction since 2004, as the recent economic lockdown to contain the spread of the novel coronavirus weighed on economic activities. Both the oil and non-oil sectors shrank by 6.05 percent and 6.63, respectively With businesses still reeling from the health and economic impact of the pandemic, economists and analysts say another recession may be on the way for Nigeria, as they expect another quarter of negative growth in Q3. “As we await Q3’20 results, it is no longer a question of whether Nigeria will experience a second recession in 4 years. It is how quickly we can navigate back to safety,” Yomi Olugbenro, apartnerandtheWestAfricaTax leader at Deloitte, states. “Will it be a protracted recession, slow recovery, fast recovery or a depression,” Olugbenro says in a tweet. Bismarck Rewane, CEO, Financial Derivatives Company (FDC), notes, “Technically, Nigeria is in a recession. How severe, how long and what steps should be taken imme-

diately to reduce the impact of the recession, the length and duration, is what policymakers should be focusing on.” A 2014 collapse in global oil price that resulted in five quarters of negative growth pushed Africa’s biggest economy into some of its worst macroeconomic forms. Since then, growth in the country has averaged around 2 percent, crawling behind population growth of 2.6 percent. This has made its citizens poorer as the country’s per capita has remained on a downward trend. Nigeria’s economy had barely healed from the 2016 induced recession before the pandemic struck. According to the International Monetary Fund (IMF), Nigeria entered the pandemic in a weak economic position, including inflation that was roughly three times the average in peer countries as well as falling real per capita income. A second recession in four years could throw the country into a dire state, worse than what was seen in 2016, according to analysts who spoke with BusinessDay. “Even before this contraction, the economy has not recovered fully from the 2016

Rising unemployment, inflation make... Continued from page 2

enue negatively,” Leye notes. “Rising unemployment and inflation rates mean a reduction in CIT and VAT revenue for now, although there might be a spike in VAT in Q4 2020 and Q1 2021, this will however be a normal spike because this would be a festive period, after which the downward trend in VAT will continue,” he says. Earlier in the year, the government projected a marginal decline in key non-oil revenue components, including VAT and CIT. It however appears that the suggestion of a 50 percent de-

cline in projections for non-oil revenue made by tax experts polled in a BusinessDay survey still stands. By the end of May 2020, the prorated VAT revenue for the period was only achieved by 42.7 percent as actual VAT revenue was N522.95 billion instead of the targeted N912.76 billion. Also, revenue from CIT did not meet its target for the period of N749.42 billion as only about 63.9 percent of the prorate for January to May was achieved at N497.07 billion. If the half-year figures for CIT and VAT revenue are doubled, CIT revenue would be N994.14 billion and VAT www.businessday.ng

recession because marginal albeit positive growth was driven by few sectors including oil and ICT. But with this contraction, there is every possibility that it might take another one to two years before the economy goes back to pre-pandemic growth level,” Damilola Adewale, a Lagosbased economic analyst, says. At least, 33 subsectors recorded negative growth out of a total of 46 sectors in the second of 2020, a pointer to how hard-hit the Nigerian economy is impacted. Growths were mainly seen in the financial, telecoms, and coal and mining subsectors. With the present negative growth, the Nigerian economy is in critical dire straits as it is confronted with three critical macroeconomic issues (soaring unemployment, rising consumer prices and economic downturn). Headline inflation, which serves as a measure of consumer prices, rose at a faster pace for 11-consecutive months, reaching a 27-month high of 12.8 percent in July, while Nigeria’s unemployment rate came to 27 percent in Q2 2020, as more and more were rendered jobless from the impact of the pandemic. “With economic growth staying in the negative and the population growth is not

contracting, a clear sign of more Nigerians becoming poorer are unfolding,” Abiodun Keripe, head of research at Afrinvest Limited says. More than three renowned global institutions including the IMF, the World Bank and McKenzie, as well as various domestic investment and research houses have said a technical recessionisinthecardsforNigeria. The IMF forecasted the Nigerian economy to contract by 5 percent in 2020, while the economy is expected to shrink by 3 percent and 8 percent based on estimates by the World Bank and McKenzie, respectively. For Africa’s largest economy, entering into an inevitable recession might take until 2023 for it to start recording any meaningful growth, according to Jesmin Rahman, IMF mission chief and senior representative in Nigeria. But with a 6 percent contraction in Q2 2020, the economy would have to contract as much as 8 percent both in the third and fourth quarters for its annualised growth to be in line with IMF estimate. Analysts who spoke with Businessday all agreed that although a recession is inevitable, the Nigerian economy would show some resilience so as not to record the same deeper cut in Q3 and Q4 as seen in the second quarter.

revenue would be N1.05 trillion, a respective shortfall of 44.7 percent and 52.1 percent. But of course, with the increases in unemployment and inflation, we might not even be seeing anything close to the doubled amount of the half-year CIT and VAT revenue, according to Emmanuel Faith, process analyst at General Electric. During 2016 recession, CIT revenue declined by 6 percent from its 2015 figure of N993.18 billion to N933.54 billion, while VAT revenue increased by 66.2 percent from its 2015 figure of N498.23 billion to N828.19 billion. Nonetheless, neither CIT nor VAT was able to meet up with the prorated annual

revenue of N1.79 trillion and N1.47 trillion, respectively. “We are expecting a recession by Q3, so we expect less consumption in the economy which will in turn bring about an underperformance of the projected non-oil revenue,” notes Yinka Ademuwagun, research analyst at United Capital. “The CIT revenue expectation is however tricky as revenue is declining for some companies and improving for some other companies like the telecommunication and financial services companies. The net impact of the current economic issues might therefore balance out any negative effect so that the amount of CIT revenue raised may not be affected,” he explains.

https://www.facebook.com/businessdayng

vestment Promotion Council (GIPC) registration fee, locking up shops belonging to Nigerians unable to pay. This amount demanded by the Ghanaian authorities equals N470 million or GH₵5.78 million, which is large enough to set up 500 small businesses in Nigeria and Ghana. Apart from the constant use of “foreigners” in Ghana when referring to Nigerian and West African traders, frequent harassment of Nigerian businesspeople by Ghana Union of Traders Association and ban on participation in retail business are pointers to obnoxious policies that could hurt the AfCFTA from January 2021. “Trade integration is meant to give us more business access with one another, but it appears that we are not building that synergy,” Chijioke Ekechukwu, former director-general of Abuja Chamber of Commerce and Industry, told BusinessDay. Ekechukwu said in the light of the AfCFTA, such row in trade relations could be detrimental to both countries. The requirement for GIPC registration in Ghana is $1 million minimum foreign equity, while registration fee is 31,500 cedis, BusinessDay understands. But there is no clarity on these provisions as Ghanaian authorities constantly refer to this as tax Nigerian traders must pay. Ghanaian laws prohibit traders outside the country’s shores, who are referred as foreigners, from participating in retail trade. “The row between Nigeria and Ghana is not good for our regional economic integration that we have through ECOWAS,” Monday Osasah, acting executive director, African Centre for Leadership, Strategy and Development, told BusinessDay. Ghana President Nana Akufo-Addo said in December 2019 after an earlier lockup of Nigerian shops in the country that the Ghana Union of Traders Association made no mistake in the interpretation of the law banning foreigners in the local retail market, according to BBC. “We cannot make headway with AfCFTA when Ghana does not allow West African neighbours to trade in its country. I see it as a retaliation against Nigeria’s border closure,” Ike Ibeabuchi, managing director of MD Services, a manufacturing, trade and servicing outfit, said. The closure of NigeriaBenin Republic border has hurt Ghanaian traders who trade along the corridor badly. As of the third quarter of 2019, Ghana was the biggest importer of Nigerian products. It imported 17.18 percent of made-in-Nigeria products within the period, beating the European Union and China, @Businessdayng

according to the National Bureau of Statistics (NBS) data. In January 2020, Ghana president, Akufo-Addo, pleaded with President Muhammadu Buhari to reopen the closed borders because of its major negative impact on Ghana’s economy. But this has not happened. However, Ayoola Olukanni, director-general, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), said such challenges would have no impact on the AfCFTA. The fact that the regional or continental trade is laced with critical problems does not mean that the AfCFTA would fail, he said, disclosing that many Nigerian firms are already taking a long view on the trade treaty. “I am not saying there are no major problems, but the AfCFTA is a strategic option for businesses, and these problems do not invalidate the visions of the AfCFTA,” Olukanni said. The AfCFTA seeks to liberalise trade among African countries. It is targeted at a ‘borderless’ Africa, with an eye on a single market for goods and services on the continent. It is easily the largest trade agreement since the World Trade Organisation (WTO) in 1994, and a flagship project of Africa’s Agenda 2063, targeted at creating a single market for 1.2 billion people and exposing each country to a $3.4 trillion market opportunity on the continent. Trade among West African countries is about 12 percent, which is relatively low when compared with other regions. On continental basis, trade among African countries is 16 percent, which is poor when compared with Europe’s 59 percent, Asia’s 51 percent, North America’s 37 percent, and Latin America’s 20 percent, data show. There are concerns that the inclinations of several African nations could hurt the AfCFTA trade agreement that promises to make Africa a trading hub. Recently, South African mobs chased away business owners, claiming that they were foreigners taking over their businesses and jobs. The Nigerian government has shut its border with neighbouring Benin Republic for one year. In March 2019, Rwanda shut down borders against Uganda over diplomatic row that has seen the two countries suspecting each other. In April 2019, Eritrea unilaterally closed all border crossings with neighbouring Ethiopia less than a year after the two countries made peace. In June 2019, Kenya shut its borders with Somalia for security reasons one week after outlawing trade along the coast near the Somalia border. Kenya authorities cited increased illegal trade as well as human and drug trafficking in the area as major reasons for the latter action.

Tuesday 25 August 2020

BUSINESS DAY

NEWS

NEPZA harps on PPP to promote investment GBEMI FAMINU

anaging director of Nigerian Export Processing Zones Authority (NEPZA), Adesoji Adesugba has emphasised the need for effective collaboration between the government and private sector towards the promotion of investments such as the Lagos Free Zone (LFZ) operated by the Tolaram Group. Adesugba stated this during NEPZA’s visit to the zone, which is the first privately owned special economic zone in Nigeria with an integrated deepsea port. The LFZ is home to several brands including Kellogg’s, Dano Milk, Power Oil, Colgate, BASF. The NEPZA’s visit started with a detailed presentation by the LFZ business development and marketing manager, Chinju Udora, before progressing to site visits of the Lekki Deep Sea Port and the Power Oil manufacturing plant. Lekki Port, which is set to be fully operational by the fourth quarter of 2022, is seamlessly integrated within LFZ to connect it to regional and international routes. Lagos free zone remains committed to enhancing the ease of doing business in Nigeria. The central processing centre that current-

ly hosts agencies including the Nigeria Immigration Service (NIS) and NEPZA facilitates a single window system to meet all registration and day-to-day operational needs of businesses. Critical ancillary facilities such as ready-built standard industrial facilities, warehouses, emergency response medical facility, dedicated truck pack and logistics support enable a cost-effective and hasslefree operational environment for businesses. Adesugba said: “As a developing country, we need to focus on key aspects that can lead to accelerated economic development. NEPZA is an agency of government that is geared towards ensuring there is industrialisation using the template of the free zones and this is exactly what we are working towards. “It is also important to stress that irrespective of legislation, the purpose and the mandate given to the free zone is that it must be a tax free zone. Therefore, no matter the complications, we have to make sure that ours is not different to others. We will also be upgrading the investment promotion unit of NEPZA to a full-fledged department, as it is crucial for the government and private sector to promote great investments such as the LFZ.

Obasanjo lauds private sector push to tackle 14m out-of-school children KELECHI EWUZIE

ormer President Olusegun Obasanjo has said that investment by the private sector in education has the potential to lift over 14 million out-of-school children and develop their abilities to become useful to themselves and their communities. Obasanjo stated this during a virtual 2020 fellowship graduation of the second cohort of Teach For Nigeria Fellows, noting that to close the gap in the education space as a nation, the country requires prompt action from Nigerians who are courageous, patriotic, committed and have the foresight to spearhead a new Nigeria, especially in the education sector education. Obasanjo, at the event where 161 fellows who have impacted over 9,660 students in 80 schools across Lagos, Ogun, and Kaduna States graduated, described the initiative by Teach for Nigeria as laudable, stressing that the ability to identify problems and work towards providing relevant and ef-

fective solutions is a unique leadership attribute. According to him, “What I find most interesting is the diversity of these initiatives and the impact you are driving from projects like edufix focused on providing STEM training to public school teachers, to projects aimed at improving the learning outcome of pupils as well as other ICT, innovation and health-related projects. You have multiplied your impact by creating sustainable solutions that will outlive your time at the fellowship”. The Teach for Nigeria Fellowship is a two-year fulltime paid commitment designed to build a movement of leaders who will work towards eliminating educational inequity in Nigeria by teaching in underserved schools in low-income communities across Nigeria. The former president urged the fellows to see the fellowship as the beginning of their leadership journey. “While the Fellowship might have provided you with the first-hand experience of the inequities in our system, you have to continue to leverage your acquired skills. www.businessday.ng

L-R: Shuaibu Ahmed, chairman, Noor Takaful; Muktar Bakare, director; Fidelis Atanya, logistics manager, ITB Nigeria Limited, and Aminu Tukur, MD/CEO, Noor Takaful, during the presentation of surplus cheques to policyholders by Noor Takaful in Lagos, yesterday. Pic Olawale Amoo

NIMASA seeks partnership with Immigration to curb illegal migration, piracy AMAKA ANAGOR-EWUZIE

igerian Maritime Administration and Safety Agency (NIMASA), has solicited support from the Nigeria Immigration Service (NIS) to curb illegal migration and piracy on the nation’s waters. Bashir Jamoh, directorgeneral of NIMASA, who called for the collaboration during a recent visit to comptroller-general of Nigeria Immigration Service, Muhammed Babandede, in Abuja, stated that partnership with relevant government agencies was necessary to secure the Nigerian maritime domain. Jamoh described the immigration as a critical stakeholder in the security apparatus of the country. He said the service was also critical in the implementation of the Coastal and Inland Shipping

Act (Cabotage), which seeks to empower Nigerians in the maritime sector. “We need to interface and synergise to achieve our common goal of national security. Many of the criminal activities that take place in our waters emanate from land, and Immigration Service is a very important element in any effort to nip such crimes in the bud,” he said. Continuing, he said: “There are provisions in the Immigration law, for instance, that empower the NIS to grant work permits to expatriates, and some of these expatriates work as seafarers. But, then, according to one of the four legs of the Cabotage regime, expatriates are not meant to man our ships, except where their expertise is needed for such operation. And their services can only be engaged after a waiver has been granted by the exclusive permission of the Minister of Transportation.”

To avoid any conflicts that may arise from a situation, where, for instance, a seafarer had obtained a work permit from the Immigration but is not qualified to function as a seafarer within the Nigerian maritime domain, Jamoh noted that collaboration between NIMASA and NIS is necessary. This, he said, would help to harmonise the seemingly overlapping laws and forestall unnecessary rancour among officers of the two agencies, adding that NIMASA was currently enjoying such synergy with agencies like the Nigerian Navy, Nigeria Police, and Nigerian Ports Authority (NPA). “So far, we have recorded tremendous successes in our various mandates through such collaboration. One of the most notable is the recent arrest of suspected pirates, which was made possible by information and intelligence sharing,” he added.

On his part, Babandede expressed the readiness of the NIS to partner NIMASA. He disclosed that NIS had started making use of the Migration Information and Data Analysis System (MIDAS), a comprehensive border management information system developed by the International Organisation for Migration (IOM). He said MIDAS was designed with the capability to collect, process, store, and analyse travellers’ information, especially the biometrics and profile, in real time for the purpose of identification, verification, and authentication of documents. According to him, MIDAS had been installed in about 24 locations across the country’s land borders, airports, and seaports, which include the International airports in Abuja, Enugu, Lagos, and Kano; and land borders in Ogun, Cross River, Kastina, Jigawa, Kebbi, and Zamfara states.

COVID-19: It is privilege to be part of the fight - Landmark boss CHUKA UROKO

fter a successful complementary treatment of over 300 Covid-19 patients at the Eti-Osa Isolation Centre within the precinct of Landmark Village, Paul Onwuanibe, the CEO of Landmark Africa, says it has been a privilege for the company to support the fight against the deadly virus in Lagos. Following the expiration of the three-month agreement between the Young Presidents’ Organisation (YPO) and Lagos State, the N1.2 billion facility was decommissioned recently. “It is quite an emotional period for us, seeing all the success stories that had come out of the isolation centre within the Landmark Village. The isolation centre recorded truly remark-

able success stories, like the 98-year-old grandmother who was successfully treated and discharged. We consider it a privilege to have been part of the efforts to curtail the spread of the virus in Lagos State,” Onwuanibe said. The Eti-Osa Isolation Centre was completed within 19 days in April to improve the capacity of the state to fight Covid-19. The 80-bed facility was fully equipped with six ventilators, monitors, respirators, mobile X-rays, ultrasound and oxygen piping as well as all other auxiliary medical and non-medical facilities. The centre also had 97 clinical and 45 operational staff who all had undergone regular trainings once the centre commenced operations to treat moderately to severely ill Covid-19 patients. All the equipment and furniture within the isolation cen-

https://www.facebook.com/businessdayng

tre will now be donated to the Lagos State government to improve healthcare service delivery after the centre is decommissioned. Speaking about the decommissioning process at a virtual press conference organised by Landmark, Richard Ajayi, member, steering committee of the YPO and founder of the Bridge Clinic, said, “we have engaged a world-class decontamination firm, Boeker Public Health Services, which shall be fully responsible for disinfecting the structure using WHO approved protocols.” Continuing, he said “this forward-thinking measure is an example of how thoroughly Landmark planned for the isolation centre to co-exist independently with general commercial activities within the Landmark Village. “From putting up the entire structure speedily to @Businessdayng

world-class standards, to putting in place specific safety measures which ensured that we have zero cases of cross-contamination, to the decommissioning phase –Landmark’s processes ensured that the siting of the isolation centre had indeed contributed significantly to the fight against Covid in Lagos State,” said Enyinna Okorafor, head of projects at Landmark Africa. Oyindamola Tukuru, Landmark Africa’s head of customer service and operations, said they appreciated the YPO and Lagos State government for a fruitful and productive collaboration to save the lives of Lagosians, noting that they at Landmark would continue to support the community at large by promoting Covid-19 health and safety measures in accordance with Lagos State directives.

Tuesday 25 August 2020

BUSINESS DAY

NEWS

NRC hits by dearth of rolling stock amid lingering Apapa gridlock MIKE OCHONMA

espite series of stakeholders’ engagements funded with tax resources, what appears to be missing in terms of the all-important rail to port freight carriage is finding the remote and immediate solutions to smooth container haulage around Apapa seaport. Checks by BusinessDay reveal that the Nigerian Railway Corporation (NRC) does not have the required rolling stock to move the huge stockpile of containers that litter the container stack yard at the port for many months. According to Jerry Oche, Lagos rail district manager (RDM) in a telephone conversation with BusinessDay, a rake of rolling stock is made up of 19 wagons which can carry 19 numbers of 40-feet containers or double equiva-

lent of 38 numbers of 20-feet containers. Recent checks reveal that, it costs between N500,000 to N800,000 to move a 40-feet container by truck within Lagos from the Apapa and Tin-Can Island ports, and costs not less than N1 million to move containers by road out of Lagos. Moving the same size of container by rail to Ibadan costs between N62,120 and N100,000 depending on the cargo and other sundry charges. For many years, businesses and residents have been forced to relocate from Apapa accompanied by high vacancy rate while there are reports of severe attacks on defenceless motorists trapped in traffic leading in and out of the port community. The RDM stated that, NRC was doing two trips of container haulage daily, but now reduced to one trip per

day due to inadequate line capacity and ongoing construction of the Lagos-Ibadan standard gauge rail project, including operational issues that needed to be addressed at the APM Terminal. While not specific on the number of rolling stock required to decongest the port stacked with containers that have accumulated demurrage and occasioned long queues of trailers along the port access road, Jerry Oche stated that, NRC has submitted request for purchase of more rolling stock through the federal ministry of transport. Oche was non-committal on the timing and availability of the rolling stock which he insists remains a policy affair of government. Meanwhile, there have been several calls by a cross section of Nigerians on the need to invest in the rail sector, but there seems to be apathy by private investors on

fears of government policy inconsistency which analysts say may affect their returns on investment. In November 2018, Bloomberg magazine noted that the congestion outside and problems within the Nigerian ports were choking the country’s economy. A World Bank’s Trading Across Borders survey, which measures the time and expense, involved in importing and exporting goods, ranks Nigeria 182 out of 190 countries, below Syria and Afghanistan. The ranking may not have improved as at the time of filing this report. Two years ago, the Lagos Chamber of Commerce & Industry (LCCI) lamented that Nigeria loses $19 billion annually, or about 5 percent of its gross domestic product, from the delays, traffic jams, illegal charges and insecurity that are increasingly prevalent at its ports.

L-R: Ayokunle Omileye, project officer, Oko Oba Abattoir; Rasheed Marculey, director, Vetinary; Abisola Olusanya, acting commissioner for agriculture, Lagos State, and Olayiwole Onasanya, permanent secretary, ministry of agriculture, Lagos State, during acting commissioner inspection tour to Oko Oba-Agege Abattoir in Lagos.

Power Oil partners Lagos women assembly programme

o deepen its engagement with the women of Lagos State, Power Oil, one of Nigeria’s vegetable cooking oil brands, is partnering Lagos State ministry of women affairs and poverty alleviation across all local government areas in the state to promote health education, tagged ‘Women Assembly Programme’. The prograame was officially kicked off at Surulere local government secretariat and presided over by the state commissioner for women affairs and poverty alleviation, Cecelia Bolaji Dada who condemned the spate of social vices in the society. She said good health was the gateway to everything, adding that “To have good health, women must take care of their body, mind and soul. It is when we have good

health that we can run around for business and engage in other activities”. Omotayo Azeez-Abiodun, the public relations manager, Tolaram Group, who was present at the Surulere local government forum, Power Oil was delighted to align with the forum which is aimed at creating awareness against social abuse/violence against women in the society while supporting both their mental and general wellbeing. She said the programme targeted “healthy living and general wellbeing”, which is why Power Oil Health camp has committed to be available to provide free basic medical health check to all the women present at every of the local council in Lagos all through the programme.

DigiConverge signs content distribution partnership with VivaliveTV SEYIJOHN SALAU

www.businessday.ng

igiconverge, a one-stop digital convergence platform that provides fit-for-purpose services in e-broadcasting and global content syndication has launched operations in Africa, starting with Nigeria. The platform which has the Federal Government support, signed the partnership deal for Africa with the Viva Entertainment Group Inc. US to bridge the gap between Hollywood and Nollywood through effective collaborations and broadcast of original and exclusive African movies on the Flikontv Channel. Yemi Osinbajo, Vice President of Nigeria, said the newly launched Digiconverge is an example of Africa being a producer

and not just a consumer of technology products. Osinbajo stated this in his keynote address during the virtual launch of the platform, through the special assistant on innovation, Office of the President, lfe Adebayo, with the theme “unlocking the benefits of the fourth industrial revolution”. He expressed confidence that Nigeria, and by extension Africa, can be put on the right path to harnessing the opportunities that the fourth industrial revolution presents. “We need to ensure that as government, we support initiatives like DigiConverge, and create opportunities, develop policies to protect intellectual property, and ensure adequate funding sources for research and innovation for continuous product improvement.

https://www.facebook.com/businessdayng

Sahel Capital appoints Deji Adebusoye as principal BUNMI BAILEY

ahel Capital, fund manager for the Fund for Agricultural Finance in Nigeria (FAFIN) has named Deji Adebusoye as the principal with Sahel Capital Agribusiness Managers Limited. Deji, since joining the company in 2016, has led investments and provided portfolio company oversight of FAFIN’s portfolio. He has over 12 years of experience; of which seven years have been operating roles in the fast-moving consumer goods (FMCG), agrochemicals, and seed sectors, and also four years within food and agriculture private equity. He serves on the board of directors of L&Z Integrated Farms and Coscharis

Farms Ltd.; and also oversees FAFIN’s technical assistance facility. “Deji has contributed immensely to a broad range of our initiatives since he joined Sahel Capital, and I look forward to him joining our leadership team as we continue to build the foremost food and agriculture private investment firm in Africa,” Mezuo Nwuneli, managing partner, Sahel Capital said.

UNILAG senate elects first female acting V-C KELECHI EWUZIE

he Senate of the University of Lagos (UNILAG), Akoka, on Monday announced Folasade Ogunsola as the new acting vicechancellor. Ogunsola until this announcement was the deputy vice-chancellor in charge of development services and the first female to be so appointed in the history of the University of Lagos. She defeated her opponent and a deputy vicechancellor in charge of management services, Ben Oghojafor, with a wide margin. She scored 135 votes as against Oghojafor’s 31 among the senate members. A total of 167 professors were accredited for voting while one vote was voided. Ogunsola, a professor of medical microbiology and was the first female provost of the university’s college of

medicine, Idi-Araba. Ogunsola’s election followed the request made by the visitor to the vniversity, President Muhammadu Buhari on Friday, August 21, 2020. Buhari had intervened in a lingering crisis between the governing council of the university and its senate when he ordered the suspension of the acting vicechancellor appointed by the governing council, Omololu Soyombo. The President had also suspended Wale Babalakin as Pro Chancellor and Oluwatoyin Ogundipe, vice chancellor of the university, pending the report of a visitation panel set up by him. The special visitation panel to the University of Lagos has Tukur Saad as chairman. Other members include Victor Onuoha, Ikenna Oyindo, Ekanem Braide, Adamu Usman, Jimoh Bankole and Grace Ekanem.

Investors raise Ondo economy with $350m KORETIMI AKINTUNDE, Akure

nvestors have in the last three years staked $350 million (about N135.2 billion in Ondo State economy. Alex Ajipe, managing director, Ondo-Linyi Industrial Hub, Ore, in Ondo South, disclosed this in a recent session with members of the Nigeria Union of Journalists (NUJ), Ondo State c1ouncil. Ajipe, who is also the CEO of Klick Konnect Networks International Limited, noted that the investments were made possible because of the investment-friendly environment created by the Governor Rotimi Akeredolu-led administration. “Before the advent of this present administration @Businessdayng

in 2016, there was no public industry in Ondo State that was functioning. Companies like OluwaGlass, Ifon Ceramic, and Ile-Oluji Cocoa Plantation had all gone under because of mismanagement and loss of focus, which steered the state away from industrialisation and tagged as ‘civil servant state.’ But in the last three years, we have had over $350 million of foreign direct investments in the state as confirmed by the ministry of trade and investment. “We actually have 15 different companies that are coming into phase one of OndoLinyi Industrial Hub at the moment but seven companies have commenced operations, so, we still have eight to go.

Tuesday 25 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 25 August 2020

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Monday 24 August, 2020

Top Gainers/Losers as at Monday 24 August, 2020 LOSERS

GAINERS Company

Closing

Change

PRESCO

N51

N49

-2

0.2

WAPCO

N11.7

N11.5

-0.2

0.15

UCAP

N3.21

N3.1

-0.11

0.15

NASCON

N10.1

N10

-0.1

VALUE (N billion)

0.12

UBA

N6.6

N6.5

-0.1

MARKET CAP (N Trn)

Closing

Change

UNILEVER

N13.95

N15

1.05

GUINNESS

N15.2

N15.4

N3.85

N3.6

N3.75

N1.24

N1.36

INTBREW UPL

Company

ASI (Points)

Opening

DEALS (Numbers) VOLUME (Numbers)

25,229.12 3,737.00 251,188,123.00 2.360 13.161

Market opens week in green as investor buy consumer goods stocks Soties by Iheanyi Nwachukwu

igeria’s stock m a r k e t opened the new trading week in green (+0.03percent) as investors gained N3billion amid raised wagers on consumer goods stocks –led by Guinness Nigeria (+1.32percent) and International Breweries (+4.17percent). This month, the market has increased by +2.17 percent, while this year it has decreased by -6. 01percent. The Nigerian Stock Exchange (NSE) All Share Index (ASI) and Market Capitalisation which opened for trading on August 24 at 25,221.87 points and N13.158 trillion increased to 25,229.12 points and N13.161trillion. At the close of remote trading session on the Nigerian Stock Exchange, Unilever Nigeria shares increased most from N13.95 to N15, after adding N1.05 or 7.53percent. It was followed by Guinness Nigeria which rose

L-R: Hadi Sirika, minister of Aviation Sen. with Lamido Yuguda, director general, Securities and Exchange Commission during a Senate Public Hearing Interactive Session on the 2021-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper at the National Assembly.

from N15.2 to N15.4, adding 20kobo or 1.32percent. PZ Cussons Nigeria also rallied from N3.85 to N4, up by 15kobo or 3.90percent. International Breweries also went up from N3.6 per share to N3.75, adding 15kobo or 4.17percent;

while University Press Plc increased from N1.24 to N1.36, adding 12kobo or 9.68percent. Presco recorded the highest dip, from N51 to N49, down by N2 or 3.92percent; while Lafarge Africa share price decreased

from N11.7 to N11.5, losing 20kobo or 1.71percent. In 3,737 deals, investors exchanged 251,188,123 units valued at N2.360billion. Transcorp, Zenith Bank, GTBank, FBN Holdings and Presco were actively traded stocks.

Nigeria’s SEC to strictly enforce Capital Market rules

he Securities and Exchange Commission (NSE) has said it would strictly enforce all rules that guide the operations of the capital market so as to restore investors’ confidence. The Director General, SEC, Lamido Yuguda, said this at the first capital market committee meeting which was attended virtually by over 240 stakeholders in the capital market. The meeting marked the first interaction between the newly-inaugurated Executive Management team of the Commission and the capital market community. At the meeting, the SEC DG assured market participants of the Commission’s collective commitment to continue implementing the ongoing initiatives of the Nigerian Capital

Market Master Plan and other related initiatives targeted at developing our capital market. He further promised to continuously seek ways of improving these initiatives, while efforts are being made to introduce new ones to the benefit of capital market stakeholders. In order to increase the visibility and attractiveness of the capital market, he said the commission would work towards maintaining an environment that is enabled by the appropriate regulatory framework. This, he noted, would be implemented through timely and affordable access to the capital market, zero tolerance for infractions, heightened investor confidence and awareness, innovative product development and good governance practices. www.businessday.ng

According to him, “We need to restore investor confidence and attract the retail and young investor into the market. Thus, we will ensure strict enforcement of our rules and regulations, strengthen our enforcement regime and clamp down on illegal operators luring unsuspecting investors with various Ponzi Schemes.” To support the Federal Government’s fight against the Covid-19 pandemic, he said the Commission set up the Capital Market Support Committee on Covid-19, headed by Ariyo Olushekun, to raise funds and offer various supports towards combating Covid-19. With the support of various market participants, the SEC DG explained that the committee, on behalf of the Nigerian capital market, has so far donated five ambulances

to various state governments as well as the Federal Capital Territory and the Presidential Task Force on Covid -19. In addition, he emphasised that the committee has distributed several face masks, infra-red thermometers and other medical equipment, including food items. Going forward, Yuguda said the Committee intends to develop a capital market sponsored Nigerian strategic healthcare infrastructure fund. In furtherance of the initiative to infuse capital market education into the curriculum of Basic and Secondary schools, he said various tradegroups have supported the efforts of the Financial Literacy Technical Committee with the sum of N78.3million, out of which N34.7million had been expended.

https://www.facebook.com/businessdayng

Global market indicators FTSE 100 Index 6,104.73GBP +102.84+1.71%

Nikkei 225 22,985.51JPY +65.21+0.28%

S&P 500 Index 3,421.69USD +24.53+0.72%

Deutsche Boerse AG German Stock Index DAX 13,066.54EUR +301.74+2.36%

Generic 1st ‘DM’ Future 28,156.00USD +297.00+1.05%

Shanghai Stock Exchange Composite Index 3,385.64CNY +4.96+0.15%

Coronation Merchant Bank launches Mobile Banking App

oronation Merchant Bank has once again blazed the trail in merchant banking with the launch of its mobile banking application. The App which is the first of its kind within the merchant banking space provides customers with easy access to their accounts as well as the ability to perform transactions seemlessly without the need for in-person banking. In spite of the novel coronavirus, Coronation Merchant Bank has been at the vanguard of pioneering innovative solutions to enable its customers achieve their strategic objectives. Earlier this year, the Bank announced its partnership with IFC (a member of the World Bank Group) to provide a $40 million Trade Finance Guarantee facility for its clients. This was the first time in 5 years that IFC would approve such a facility in Nigeria. Furthermore, the Bank was recently appointed as a designated bank for the collection and remittance of

all Revenue Payments (i.e. Import, Excise and other duties) by the Nigeria Customs Service. Commenting on the launch, Banjo Adegbohungbe, Managing Director/ CEO of Coronation Merchant Bank stated that, “We are delighted to be at the forefront of digital banking within the merchant banking space. We recognise that these are very difficult times and our customers are looking for a partner that can help them navigate the challenges induced by the COVID-19 pandemic. This is why we are constantly raising the bar and pushing the limits in service delivery by pioneering innovative solutions that make banking easier and faster for our customers”. He further stated that, “our goal is to consistently create value for our customers and to provide them with solutions that enable them meet their strategic objectives. We remain committed to being there for our customers even in these difficult times”.

FATE Foundation set to hold 20th anniversary

ATE Foundation, Nigeria’s foremost enterprise development organization is set to hold its 20th anniversary. FATE Foundation was incorporated in 2000 by Fola Adeola (founder and pioneer Managing Director/Chief Executive Officer, GTBank) to harness the strong entrepreneurial culture of Nigerians by providing business incubation, growth enablement and accelerator support required to fully explore their innovative potential. Speaking on the Foundation’s work, Adenike Adeyemi, Executive Director of FATE Foundation noted that “the mission of our organization is to foster wealth creation by promoting business and entrepreneurial development among Nigerians”. In 2000, FATE Foundation started the Aspiring Entrepreneurs Programme (AEP) for young entrepreneurs/startups. This was immediately followed by the launch of the Emerging Entrepreneurs Programme (EEP) for growing businesses and establishment of the FATE Consulting unit (now Growth support unit) to provide busi@Businessdayng

ness support and advisory services for our entrepreneurs. Two years later, the organisation won the World Bank Business Plan Competition and opened the Port Harcourt Branch to focus on enterprise creation in the Niger Delta. In 2010 an Impact Assessment Study of FATE Alumni indicated that 65percent of entrepreneurs supported were still in business and they had created an average of 4 jobs. Over the last decade, FATE Foundation has pioneered initiatives that continue to focus on enabling Nigerian entrepreneurs and the ecosystem. This include the Institute for Venture Design (IVD) Fellowship in Partnership with the Stanford Center for Design Research; the Annual Policy Dialogue Series on Entrepreneurship; the one-stop virtual resource center for Nigerian entrepreneurs, msmehub.org; the ScaleUp Lab Accelerator programme and the Orange Corners Incubation programme amongst others. The organisation has also published seven (7) research reports on the Nigerian ecosystem and MSMEs.

leaderSHIP

BUSINESS DAY Tuesday 25 August 2020 www.businessday.ng

CEO in focus

Foluso Philips: Brilliant mind helping organisations attain excellence MICHAEL ANI

ith over 30 years experience as a management consultant, Foluso Philips is a renowned businessman and Nigeria’s foremost consultant, who has long standing achievements and contributions to the growth of the country’s economy. A qualified industrial economist, a Chartered Management Accountant of the United Kingdom, and a Fellow of the Institute of Chartered Accountants of Nigeria, Philips has under his belt, experience and expertise in finance, business management, enterprise development and macro-economic policy management. Several sectors and personalities in the Nigerian economy have benefited from his experience in reputation management, organization development, general management, accounting, finance and costing and management systems. He is the founder and executive chairman of Philips Consulting group, which is an industry leader in the provision of business advisory services, strategy development, training and human capacity management; corporate performance and recruitment services. Phillip Consulting was one of the first Nigerian companies to set up shop in South Africa, after the country’s free elections in 1994. Since then, the firm has been involved in numerous initiatives between the two countries From offices in Lagos and Abuja, Phillips Consulting delivers integrated client solutions through its strategy and operations transformation, people transformation, and digital & technology consulting practice areas. Prior to becoming the Chairman of the company, he occupied the position of the managing director/CEO of the firm where he steered the group with offices in Nigeria and South Africa for over 26 years before successfully handing over the operations of the firm. During his time as CEO of his firm, he launched and propagated the philosophy and concept of total quality management to the Nigerian business community. It was also during this period that he led the first delegation and a series thereafter of business and corporate leaders to South Africa on various business, education and executive missions. At the point of handing over active operation of his firm, Philips succeeded in rebranding the firm to render improved quality services. Following the rebrand, the company took up a new logo with the name “Pcl” with a promise to deliver excellence through a people centric approach. Philips noted that the rebrand

Philips

signposts the new phase in the life of the firm. He described the new brand identity, as a way of refreshing the brand, whilst not taking it away from the strong reputation it has built over the years. For him, he wanted to create an identity that would begin to separate him from the institution he has built as this would help in creating the flexibility to do more exciting things beyond the label of consulting. In 2018, Philips unveiled Robert Taiwo, a qualified lawyer with an MBA in strategy and change management from Warwick Business School as the new managing director to oversee the activities of his firm. According to him, by entrusting his business to a reliable hand it is personally refreshing to see his vision of building a sustainable institution that would outlive all and become a reality. Whilst Foluso Phillips, the firm’s Group Chairman, one-

time Chairman of the Nigerian Economic Summit Group and current Chairman of the Nigeria South Africa Chamber of Commerce, has stepped down from the operational activities of the firm. He continues to see to the internal development of the firm’s consultants and focus on executive capacity building and mentoring. In 2020, Philips Consulting announced it is supporting the Federal and State government initiative in addressing unemployment and creating jobs, by working in collaboration with its content partners to deliver free online training worth N75 million on specialised IT certifications to 500 Nigerian youths across the country. The partnership was aimed at addressing the decongestion of Lagos State, development of a land port, rail and water transportation between both States, Private Public Partnership (PPP) funding for infrastructural development, a master plan for the integration of

‘‘

both states, and an extension of the firm’s vision by working closely with the Development Agenda for Western Nigeria (DAWN) Commission. It would also among other things enable the execution of the Joint Resident Registration Scheme (JRRS), that would assist in tackling insecurity in both states, and facilitate the completion of an on-going rice mill in Lagos that will receive and process most of the rice input from Ogun State. Others include the expansion of a trailer park in Ogun state to help ease the Apapa traffic congestion in Lagos and the conclusion of an agreement with the Federal government to take over the completion of several Federal roads bordering the two states such as the Lagos – Sagamu Expressway which is only at 20 percent completion. At the signing, by the Lagos and Ogun state governments it was noted that the firm helped to prepare the agreement by both states to set up a commission that will handle all issues that are of common interest to the states. With Nigeria’s unemployment rate soaring to a six-year high at 27 percent, the consulting firm has come up with new “micro courses” that will drive the future of workplace in Nigeria by democratising learning. According to the firm, people need to know ‘how to work’ in the ‘future of work,’ as working in a new revolution with a multigenerational workforce requires higher technical, social, cognitive, emotional, and adaptive skills. These visions have been at the heart of Foluso Phillips right from the outset as chairman of the Nigerian Economic Summit Group (NESG). During his time as chairman of the private sector advocacy group, NESG, he made a number of recommendations for Nigeria that were to see Africa’s largest economy expand its role in the global space. These include but are not limited to the creation of job opportunities to avoid a possible brain drain. For him, being the largest economy in Africa by Gross Domestic Product (GDP), in addition to having the largest population in the continent, a promising economic indicator for Nigeria would be that a majority of its populace are yet to enter the working age, which sets the country up to have an expansive workforce in the near future. According to Foluso Phillips, there is little doubt about the promise of this scenario presenting its share of dangers, which might stem from an inadequate education system in the country. “The country has an imbalance in terms of access to education, with only a 30 percent rate of education in the North of the country as opposed to 80 percent in the South.

For those who are educated, Phillips warns that the current opportunities for employment fall far short of international standards, not only in terms of working conditions but also in terms of the level of technological integration that the business environment has witnessed. “We are experiencing what the Germans refer to as a ‘youth bulge’, a situation where the youth population rises geometrically with meaning job opportunities for them. We have one of the highest youth populations in the world. This can be a blessing or a threat. High volume of unemployed youths poses threat to the nation as our young professionals are emigrating legally abroad,” Phillips said He explained that the youths are seeking greener pastures and the country is losing quality people, who are the real ones to build our nation. He tasked the country to come up with a winning strategy; if not, there will be problems in the next five years. “We must tap into technology to grow our nation, deliberately measure competitiveness to attract investment, and define metrics for assessments and benchmarks.” Foluso said. Foluso advocated the importance of technological integration in tackling the country’s ballooning youthful population. He said the world is in the middle of a very violent disruption. “It is the fourth industrial revolution and Artificial Intelligence is almost here and technology is bubbling with news tricks and changes daily.” Phillips who is very active in the Nigerian corporate scene sits on many boards as a director, trustee or shareholder of commercial organizations, NGOs and charities. He was one time chairman of the Nigeria Economic Summit Group; Chairman, Nigeria/South Africa Chamber of Commerce; Chairman, Interbrand Sampson West Africa; and Chairman, Web Liquid West Africa. Phillips also served as Director, Special Olympics of Nigeria; Director, Vigeo Holdings (a Power & Energy company in Nigeria); advisory board member, Africa Leadership Academy (an African Leadership Senior School based in Johannesburg). He has also served as a consultant for government’s agencies and departments, ministries, banks, insurance companies, manufacturing companies and other organizations He is a prolific speaker, who has addressed many international business seminars and conferences including Wharton Business School and Harvard Business School both in the U.S.A., Business in Africa’s Leadership Summit in South Africa and several other leadership conferences, business and trade summits across Africa and Europe.

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Advert Hotline: 08033225506. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Patrick Atuanya. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.