BusinessDay 25 Jul 2019

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news you can trust I **THURSDAY 25 july 2019 I vol. 19, no 357 I N300

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overnor of the Central Bank of Nigeria Godwin Emefiele on Tuesday, at the June Monetary Policy Committee meeting, said the apex bank was adding milk to the

“The era of forex restriction on milk importation is coming sooner than expected,” he said.

The bank said it was ready to lend to players in the milk industry to commence the production

of the diary product locally.

In the light of the impending restriction, the major question is, should Nigeria restrict milk

Continues on page 38

AIG names winners for its Masters programme at Oxford

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frica Initiative for Governance (AIG) has announced recipients of the third round of its scholarships under which winners go on to pursue the Master of Public Policy at the Blavatnik School of Government, University of Oxford.

Every year since 2017, AIG has awarded fully funded scholarships to young, outstanding West Africans from all backgrounds that are passionate about the public

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opportunity seen in 600,000 MT shortfall in domestic production list of 43 items restricted from the FX market.

The decision, he said, was based on high cost of importing milk which stands between $1.2 billion to $1.5 billion.

3M

NGUS sep 18 2019 361.03

How FX restriction of milk will impact Nigerian economy GBEMI FAMINU & SEGUN ADAMS

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US visa restriction on complicit politicians, my vindication - Atiku …Babatope, Odumakin applaud move …Balarabe Musa says it’s interference Iniobong Iwok & Innocent Odoh

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tiku Abubakar the presidential candidate of Nigeria’s main opposition party, the People’s Democratic Party (PDP), has said that the visa restriction placed on some Nigerian politician by the United State of America (USA) for their roles in undermining democracy and the 2019 general elections confirms his stand that the elections were rigged.

Atiku said the travel restriction was also a confirmation that he won the 2019 presidential election and that some state actors and institutions undermined the result of the presidential election.

This is even as Ebenezer Babatope, a former minister, and

Continues on page 38

Inside Commuters react as Lagos mulls license fee for bike P. 25 hailing start-ups Ebenezer Onyeagwu, group managing director/chief executive, Zenith Bank plc (5th l), flanked from left Akin Ogunranti, general manager, Zenith Bank; Dennis Olisa, executive director, Zenith Bank; Adobi Nwapa, general manager, Zenith Bank; Oscar Onyeama, CEO, Nigerian Stock Exchange (NSE); Temitope Fasoranti, executive director, Zenith Bank; Nonye Ayeni, general manager, Zenith Bank, and Francis Ekonye, general manager/chief inspector, Zenith Bank, at the closing gong ceremony at the NSE, yesterday.

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Thursday 25 July 2019

BUSINESS DAY

news Ministerial nominees roll out plans for Nigeria OWEDE AGBAJILEKE, Abuja

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L-R: Babafemi Adebola, Nigeria; Chienye Ogwo, CEO, Africa Initiative for Governance (AIG); Hakeem Onasanya, Nigeria; Aigboje Aig-Imoukhuede, founder/chairman, Africa Initiative for Governance (AIG); Onyekachukwu Erobu, Nigeria; Kwame Sarpong, Ghana, and Nasir Mohammed, Nigeria, at the 2019 AIG Scholars at the Scholarship Pre-Departure Orientation in Lagos

NAICOM gives Aug. 20 deadline for insurers to submit recapitalisation plans MODESTUS ANAESORONYE

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he National Insurance Commission (NAICOM) has given clarity to what makes up the new minimum capital requirement for insurance companies, giving operators on or before Tuesday, August 20, 2019 to submit their recapitalisation plans.

NAICOM stated this in a circular numbered, NAICOM/DPR/CIR/25 – 02/2019; dated July 23, 2019; entitled; Re: Minimum Paid up Share Capital Policy for Insurance and Reinsurance Companies.

The circular was signed by the Director, Policy & Regulation Directorate, NAICOM, Pius Agboola and sent to all insurance companies, adding that it is in furtherance to the circular dated May 20, 2019.

NAICOM stated that the

…clears ambiguities in new capital requirement recapitalisation plan should include among others; capital status of the companies as at the last audited financial statements; board resolution on how to comply with the directives; detailed action plan on how the funds for the recapitalisation are to be sourced with timeline and deliverables.

Companies intending to seek funds from the capital market are required to submit their plan of action on a file-and-use basis and companies that intend to merge or acquire another should submit their proposal after which they must comply with Section 30 and 31 of the Insurance Act 2003.

The commission noted that after the submission is made, it shall review and provide response on the submitted plans on or before

September 17, 2019, adding that the review may require meeting the board and management of each of the insurance company on its recapitalisation plan.

The insurance industry regulator said it is engaging other regulatory bodies for possible palliatives in additional to those it is has considered.

It also maintained that in furtherance to the circular dated May 20, 2019, the minimum paid up share capital shall be through any or a combination of the following; existing paid up share capital; cash payment for new shares issued; retained earnings – capitalisation of u distributed profit; payment in kind (other than by way of cash) for new shares issues such as properties; treasury bills; shares; bond which must be converted to cash not later

than three months to the deadline for recapitalisation and share premium.

NAICOM added that the items listed above can be achieved through merger and acquisition.

NAICOM said cash payment for new shares issued shall be deposited in the escrow account with the Central Bank of Nigeria (CBN), adding that deposited funds shall be released not later than 30 days after confirmation and issuance of a new licence.

The commission posited that the shareholders’ fund as at the last date of recapitalisation for existing insurance/reinsurance companies shall not be less than the required minimum paid-up share capital.

•Continues online at www.businessday.ng

$4m investment for robotic surgery centre births in Nigeria …as Kasi Healthcare joins Lokmanya Hospitals India to launch service in September Kemi Ajumobi

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asi Sports Medicine and Orthopedics, the pioneer of Sports Medicine and Orthopedic Care in Nigeria seeing an average of 3000 Sports Medicine and Orthopedic patients a year, has entered a partnership with Lokmanya Orthopedics from India to provide robotic knee replacement surgery service for Nigerians.

Lokmanya Orthopedics is the pioneer in Robotic Assisted Knee replacement surgery in India performing over 4000 cases a year. In 2018, their team set the Guinness Book of Records for most knee replacement surgeries performed in a single day.

The service will be led by Narendra Vaidya, Managing

Director at Lokmanya Group of Hospitals, Pune India who performed the first ever robotic assisted total knee replacement surgery in India.

“We are pleased to welcome Kasi Sports Medicine and Orthopedics as our partner in Nigeria,” said Narendra Vaidya, President Lokmaya Hospitals. He further stated that “Our work together will be focused on locally provided care which is in best interests of Nigerians. In line with our brand, we will offer high level technology and human touch.

We currently perform over 4000 Joint replacements every year and we look forward to performing our first robotic joint replacement in Nigeria under our five year program that is focused on local care provision.” Vaidya said. www.businessday.ng

According to the President, Kasi Healthcare, Adedayo Osholowu, “This collaboration will establish our Orthopedic service as a leader in the region doing more for bone and joint care for Nigeria and bringing the best technology and top doctors in Orthopedics and Sports Medicine to the people of the Federal Republic of Nigeria.”

He further adds that “The $4mn investment is for training, equipment and operating expenses. 25percent for the first year has since commenced already and our doctors are beginning to visit India this month. We are honoured to be recognized as a pioneer in the region, entering this journey with Lokmanya hospitals.” Adedayo said.

The purpose of the col-

laboration is also for locally provided care and training fellowships for Nigerian Doctors, Nurses and Healthcare Technicians as part of the 5 year program with a vision to establish the first local Robotic Joint Replacement program in Nigeria and it will begin in September 2019.

This service will be led by Adedayo whose team performed the first Percutaneous Laser Disc Decompression Surgery and first Arthroscopic Stem Cell aided ligament Repair procedure in Nigeria in 2018.

Under the agreement, advanced In- patient surgical treatments will be offered in Pune India with Advanced

Continues on page 38

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ome ministerial nominees have rolled out their plans for the country if confirmed as ministers in President Muhammadu Buhari’s second term in office.

The nominees who were grilled on Wednesday for over six hours, answered questions within and outside their respective fields as well as on national issues.

At the end of the session, 10 nominees were screened.

They include: Uchechukwu Ogah (Abia), Godswill Akpabio (Akwa Ibom), George Akume (Benue), Emeka Nwajuaba (Imo), Ogbonnaya Onu (Ebonyi), Adeleke Mamowora (Lagos), Rotimi Amaechi (Rivers), Olamilekan Adegbite (Ogun), Adamu Adamu (Bauchi) and Sharon Ikeazor (Anambra).

Speaking during his screening, Ogah tasked the Ninth National Assembly to carry out the reforms embedded in the Petroleum Industry Governance (PIGB) Bill to unlock its huge potential to economic growth.

The reforms, he explained, were capable of creating more jobs and revenue that would catalyse the country’s economy.

He pointed out that passing the bill would open the window for more jobs for Nigerians.

“Once the Petroleum Industry Governance Bill is passed, it will help the economy in ensuring that investors will come into the country.

And once they have guaranteed crude oil. It is like building a house and nobody comes in there. So it is very difficult for people to put their money when they know that there is no source of crude to use in operating their refineries,” Ogah, a major player in the oil and gas industry, told lawmakers.

The bill is one of the oldest in the nation’s legislature, having been first introduced by late President Umaru Yar’Adua to the Sixth National Assembly in 2008.

In 2018, global extractive industry watchdog, Publish What You Pay (PWYP) had disclosed that Nigeria loses N3 trillion annually for failing to put in place a proper legislation for the oil and gas industry.

Coming at a time when Nigeria is tagged the poverty capital of the world, with some 94 million Nigerians living in extreme poverty, according to Brookings Institution and 2,877 firms shutting down in just four years due to weak economy, Ogah stressed the urgency of passing the bill, adding that this will provide massive employment for the teeming population.

•Continues online at www.businessday.ng

UK’s Supreme Court permits Nigerian communities to pursue case against Shell in England SEGUN ADAMS

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he UK’s Supreme Court will allow two Nigerian oil communities seeking compensation from Shell, following decades of environmental degradation to their lands, to pursue their case against the oil major in England.

The ruling of UK’s highest court on Wednesday paved the way for Bille and Ogale communities of Niger Delta to take a legal claim against shell after a London court in February last year said it could not exercise jurisdiction in a case involving Shell’s Nigerian subsidiary Shell Petroleum Development Company (SPDC).

“We hope that the Court will apply the principles set out in the Vedanta judgment to this case and allow this case to proceed in London,” said Daniel Leader, a partner at Leigh Day, the law firm representing the 40,000 farmers and fishermen from Nigeria.

Leigh Day had successfully presented the case of 2,000 Zambian villagers against Konkola Copper Mines and its parent company Vedanta Resources before UK’s Supreme Court. “We believe the era of corporate impunity is drawing to a close. It is no longer @Businessdayng

acceptable for companies to make billions out of developing world resources whilst causing devastating damage to the environment and local communities,” he added.

According to Leigh Day, the basis for the communities seeking redress in England is that Royal Dutch Shell (RDS), which is headquartered in London, is legally responsible for the environmental failures of the Shell Petroleum Development Company of Nigeria (SPDC), a subsidiary of RDS. The communities say there is a higher chance at justice in English courts than back in Nigeria. “The English Courts are our only hope because we cannot get justice in Nigeria. So let this be a landmark case,” said King Okpabi, the ruler of the Ogale Community in a statement on Wednesday.

A spokesperson for SPDC, however, was reported by Reuters as saying the matter should be handled in Nigeria where activities of oil thieves, sabotage and illegal refining were the main cause of the oil spills in the Niger Delta communities.

•Continues online at www.businessday.ng

Thursday 25 July 2019

BUSINESS DAY

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Thursday 25 July 2019

BUSINESS DAY

NEWS

Nigeria risks losing opportunity to become West Africa’s natural gas hub STEPHEN ONYEKWELU

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igeria may be at the verge of losing its chances of becoming West Africa’s natural gas hub, as countries along the sub-region’s shoreline have started seeking alternatives in liquefied natural gas (LNG) to replace the West African Gas Pipeline (WAGP), which has consistently performed below half its capacity.

Benin Republic is in earnest search to reverse a 750-megawatt shortfall and plans to build two Independent Power Producers (IPPs), one of which is being developed by Enterprise Power, backed by the African Infrastructure Investment Managers (AIIM), and wants to use LNG re-gasification to ensure supply reliability, Upstreamonline, an oil and gas platform, reports.

An IPP or non-utility generator (NUG) is an entity that is not a public utility, but which owns facilities to generate electric power for sale to utilities and endusers. NUGs may be privately held facilities, corporations, cooperatives such as rural solar or wind energy producers, and non-energy industrial concerns capable of feeding excess energy

into the system.

Enterprise Power is a Seychelles-registered energy infrastructure developer run by founder and partner Nikolai Germann, who has worked on tank farms, oil jetties, pipeline networks and even bio-energy power initiatives with Addax and Oryx in Benin Republic, Ivory Coast, Ghana, and Sierra Leone.

In the spirit of Economic Community of West African States (ECOWAS), four West African countries, Benin Republic, Ghana, Nigeria and Togo in February 2000, signed an InterGovernmental Agreement to build a gas pipeline, which will supply Nigerian natural gas to West African markets.

The WAGP was designed to pump 474 million cubic feet per day via a 20-inch diameter pipe with full compression, but has never supplied even half of the contracted volumes, averaging less than 100 million cubic feet per day with throughput boosted only when Nigerian Independent Power Producers fail to pay gas producers that they then switch gas for export if they can.

Twelve months ago, Ghana signed a 12-year deal with Russia’s Gazprom for LNG supply,

boycotting the WAGP and its inefficiencies.

“The gas that will come from Russia to Ghana’s re-gasification plant will cost $12 per standard cubic feet (SCF). I can put gas at $3 per SCF into the West African Gas Pipeline if it was efficiently managed, and with an extra cost of $2 per SCF for transportation cost I can deliver gas to Ghana at $5 per Scf less than half of what the Russian gas will cost,” Austin Avuru, CEO of Seplat, an independent indigenous Nigerian oil and gas exploration and production company, said in an earlier BusinessDay’s report.

Already, Seplat Petroleum is talking to private-sector investors interested in extending the West African Gas Pipeline all the way to Senegal, a proposal the company sees as a better solution than LNG re-gasification projects.

Barry Morgan, an analyst at Upstreamonline, says getting off-grid ventures in gas-fuelled power into development in Africa means leveraging networks to sustain traction with government agencies and national utilities, persuading politicians to back incentives and convincing financiers that you have structures in place to ensure profitability.

National Diaspora Day: Obaseki hails FG’s declaration, tasks community on more contributions to development

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do State governor, Godwin Obaseki, has hailed the Federal Government’s declaration of July 25 as National Diaspora Day, urging the Diaspora community to contribute more to the nation’s development.

Obaseki said the declaration was recognition of the immense contribution of Nigerians in the Diaspora to the growth and development of their home country.

According to the governor, “Nigerians in the diaspora have contributed immensely to the growth and advancement of our country and I am delighted that the President Muhammadu Buhari-led administration has set aside July 25 each year to celebrate them.”

He added: “Most of these Nigerians abroad have distinguished

themselves in their resident countries taking the lead in science and technology, governance, education, innovation, medicine and other areas.”

He urged Nigerians in the Diaspora to close ranks and join the nation’s efforts at tackling illegal migration and human trafficking, among other challenges.

“Over the years, the nation’s Diaspora community has transformed into a pool of experts from where successive governments have been drawing personnel in tackling some of our social, political and economic problems.”

He described as apt the theme of this year’s celebration: ‘The Power of the Nigerian Diaspora for National Development,’ and advised the Diaspora community “to take advantage of the National

Diaspora Day by mobilising resources towards the actualisation of our development aspirations.”

The Federal Government on Tuesday announced that it has set aside July 25 of every year as national Diaspora day in recognition of the contributions of Nigerians in Diaspora towards national development.

The announcement was made in Abuja by the Nigerians in Diaspora Commission (NIDCOM).

The NIDCOM media coordinator, Abdulrahman Balogun, explained that the commission planned to host the 2019 National Diaspora Day celebrations in collaboration with the Nigerians in Diaspora Organisation, the Directorate of Technical Cooperation in Africa and the Nigerians in Diaspora Alumni Network.

Access Bank CEO dedicates N1bn for schools in Northern Nigeria SEGUN ADAMS

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roup managing director, Access Bank plc, Herbert Wigwe, has reaffirmed the bank’s commitment to the educational development of children in Nigeria, highlighting it as one of the most important tools to sustaining the future of the country.

Wigwe said this while addressing attendees at the Access Bank/UNICEF Charity Shield Polo Tournament held at the Guards Polo Club, UK. Nigeria currently holds the unenviable position of having the highest number of out-of-school children in the world. A problem that Wigwe said the bank, in collaboration with UNICEF, aimed to solve using funds raised through the high profile polo tournament.

He said, “The number of outof-school children in Nigeria is very worrisome, and if not tackled

adequately does not bode well for the future of Nigeria. Access Bank identified this problem over 10 years ago and through the polo tournament has made considerable strides in improving the educational system in Nigeria.

“We will not relent in our efforts to ensure that Nigerian children are given the requisite educational foundation to succeed. We know the challenge before us is great, but we will surmount it through collaboration with relevant international, government and private stakeholders. We will continue to give, because our children are our tomorrow.

“So far, we have been able to raise over N1 billion and every kobo will be invested providing educational infrastructure, starting one Northern state at a time because that is where we find the highest number of out-of-school and displaced children.” www.businessday.ng

He went further to explain that government buy-in was key to the achievement of the financial institution’s set goals, citing and thanking the Kaduna State government for its support in the implementation of its projects.

The bank is already making impact through its charitable projects, recently completing the refurbishment of a 12,000 capacity school and is set to complete another that will cater for an additional 1,200 students at the end of July. These efforts have not gone unnoticed, as the Kaduna State government has committed to replicating every project that the bank will implement in the state.

This year’s Charity Polo Tournament was a huge success with several local and international dignitaries in attendance, including the Emir of Kano, Muhammadu Sanusi II; British High Commissioner to Nigeria, Catriona Laing CB, among others. https://www.facebook.com/businessdayng

@Businessdayng

Thursday 25 July 2019

BUSINESS DAY

news Nigerian Content Board pledges to work with Tranos, impressed with products quality JOSEPH MAURICE OGU

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he Nigerian Content Development and Monitoring Board (NCDMB) has applauded Tranos on the quality of its products, equipment and innovations in solving some of the challenges facing the oil and gas, telecoms, industrial and manufacturing sectors in Nigeria.

The Board has therefore pledged to work with Tranos, an engineering and manufacturing firm.

Simbi Wabote, executive secretary of the Board, while on inspection tour of Tranos’ facility in Ikeja, Lagos, recently, to ascertain the quality of its products, said it was gladdening to note that a Nigerian company had taken the initiative to manufacture locally, products that would have been imported.

Commending Tranos, Wabote said the products he saw in factory have exceptional quality and that he would have argued that they were imported, had he not seen the products in the factory. He further mentioned that Tranos had proven it has the capacity and technology to produce high quality Enclosures, Cable Trays and Ladders, Sockets and Switches Electrical Panels locally.

He noted that Tranos is bigger than some of the factories overseas where Nigerians rush to buy materials used in the oil gas industry.

Pledging government’s supports for Tranos as well as other Nigerian companies, Wabote encouraged Tranos to design materials that would assist the Telecoms clients against theft of Batteries and power components, especially at telecom Mast sites.

“We will work with you on your projects,” he assured.

NCDMB was established by the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, which came into effect on April 22, 2010.

Responding, Jude Abalaka, managing director of Tranos, said NCDMB was always interested in growing Nigerian companies, revealing that Tranos had received support from the board in the past.

While explaining the primary focus of the company, Abalaka said Tranos was focusing on developing products, investing in resources, which included personnel, equipment, and software in order to meet customers’ needs. “This is very important for us because we exist to create values for our customers,” he said.

Abalaka said Tranos had invested hugely in world-class facilities, saying, “We know how driven NCDMB are in encouraging companies.”

While taking NCDMB officials and International Oil Companies (IOCs) members around the Tranos’ facility, Abalaka said Tranos had both mechanical and electrical engineering departments manned by engineers who do the designs of materials to be produced.

According to Abalaka, the company’s works start with inhouse designs by the engineers in the departments as Tranos is an end to end manufacturing company.

Everything that is manufactured in the company first goes through the engineering design. This could be based on customer’s specifications or inhouse concepts, he explained.

US calls for participation in FTA with Africa as AGOA ends in 2025

… tasks Nigerian government on access to market next 6 years tion for the Nigerian governHOPE MOSES-ASHIKE ment is how do we take better he United States govern- advantage of the opportunities ment, through its Bureau of that AGOA presents? I mean, we African Affairs, is calling for have opened the door; we’ve got participation in the new bilateral the trade hubs there to provide free trade agreement (FTA) with assistance to individual entrepreAfrica as the Africa Growth and neurs, but it’s up to the governOpportunity Act (AGOA) ends ment to create the conditions in 2025. and to provide its businesspeople This call was made jointly by with what they need to access this Ambassador Tibor P. Nagy, assis- market. We’ve been saying that tant secretary, Bureau of African over and over again”.

Affairs, and Constance Hamilton, Giving an extensive backassistantUSTradeRepresentative ground on AGOA and on the US forAfricaduringTelephonicPress government’s focus on free trade Briefing on Tuesday. agreements, Hamilton highAGOA opens the door for op- lighted a number of other major portunities for entrepreneurs and initiatives by the administration farmersandbusinesspeopletoget to boost our trade and investtheir products into the US market. ment with Africa and to really “We are urging countries leap towards Africa’s prosperity. to continue to maximise what One of the initiatives, which they’re doing under AGOA, to was recently announced at the really take advantage of it while it Corporate Council for Africa still exists, and we’re also urging Summit in Maputo is Prosper those partners who are interested Africa, which will be a major inourFTAinitiativetoreachoutto initiative. Then another one, us and let us know. Keep in mind which was announced earlier, is that the United States is the larg- the Build Act, which will lead to est single-country market in the the creation of the International world, and the best way to secure Development Finance Corporaaccess into that market is through tion and double OPIC’s available an FTA. And so we are encour- capital for investment in Africa aging countries to think about and other developing countries to what comes next post-AGOA,” $60 billion, and then a new policy Hamilton said. announced for the Millennium She encouraged Nigerian Challenge Corporation, which government to in the next six will allow MCC to do regional years, think about how to maxi- compacts instead of bilateral mize the benefits of AGOA. compacts.

“I really think that the ques-

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L-R: Francis Enwereuzor, assistant comptroller general, zonal coordinator, zone C, Nigeria Customs Service; Umana Okon Umana, managing director, Oil and Gas Free Zones Authority (OGFZA); Aamir Mirza, managing director, West Africa Container Terminal (WACT); Hassan Bello, executive secretary/ CEO, Nigerian Shippers’ Council, and Al-Hassan Ismaila, port manager, Onne Port, during the commissioning of two new Mobile Harbour Cranes acquired by WACT to boost operation at the Onne Port, Rivers State, yesterday.

With Nigerian bond yields at 14%, nobody wants equities

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igerianstockshave next to no chance of success when they’re competing for capital against one of the emerging world’s highest bond yields.

Nigerian debt has attracted about $9 billion in foreign cash for the five months through May, compared to a little over $1 billion for stocks, according to data on the central bank website.

Foreigners hold $15 billion worth of local-currency bonds, Goldman Sachs Group estimates.

The result is a 10% drop in the main equity gauge this year and an average 16% return for

the nation’s bonds, which are among the top five performers in Bloomberg Barclays’ emerging market local-currency bond gauge.

“The return on debt is certain, the yields are attractive,” Oluwasegun Akinwale, a banking analyst at Lagos-based Asset & Resource Management, said by telephone.

“Why should I stay in equities when there is no policy clarity?”

Weighed down by concern over Nigeria’s economic growth, the prospect of rising bad loans at banks and thinning profit margins, stock inflows have slowed, despite valuations near the cheapest since 2011.

ICAN Amuwo district chairman to improve entrepreneurship initiatives, empower youths KELECHI EWUZIE

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he newly-elected chairman, Institute of Chartered Ac c o u nt a nt s o f Ni g e r i a (IC AN), Amuwo District and Society, Oluwakemi Oderinde, has promised to put in place measures to encourage members to set up Small and MediumSized Enterprises in order to boost job creation.

Oderinde also said the district under her tenure would pursue the ‘Catch Them Young’ programme with the aim of empowering students of schools in Amuwo Odofin Local Government in the Lagos State Local Education District (LED) five.

Oderinde, who spoke in Lagos during her investiture as the 6th chairman of the Amuwo and District Society of the accounting body, said she planned to also introduce a lot of improvements in the district meetings and would continue to improve on this to make the attendance more interesting and rewarding to members.

According to Oderinde, “We will continue to ensure our members welfare is

taken care of to the best of our ability. We will also ensure that members are enlightened about the latest beneficial developments in the Institute, the country and the world at large.”

She further said under her tenure as chairman, she would make sustained efforts towards taking the society to a higher level by making it more businesslike and beneficial for all co-operators.

“We shall continue to encourage new members to join our district by soliciting through the social media and organisation of beneficial programmes that will attract members who are yet to register with any district society or have relocated to our environ to join us. We will also organise programmes that will be beneficial to attract more members,” she said.

The new Amuwo District chairman disclosed that to achieve this objective, the district shall among other measures, continue to encourage members to make use of the newly created Whatapp platform for marketing their products and services.

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That contrasts with the billions pouring into government bonds, which yield 14% on average.

Even though Nigerian stocks look “extremely cheap,” they hold more downside than upside risks, EFG-Hermes analysts Simon Kitchen and Vinita Kotedia wrote in a report earlier this month, cutting their recommendation to underweight.

Low trading volumes and dwindling foreign participation are driven “by often-inconsistent macro policies that are ultimately designed to maintain dollar-naira stability,” they said.

The central bank on Tuesday defied a global trend toward dovishness and kept its key

interest rate at 13.5%, safeguarding the nation’s real rate of about 2%.

It also helps keep bonds attractive, aids policy makers in their quest to maintain the naira’s stability, and offsets investors’ concerns over the time it’s taken President Muhammadu Buhari to form a cabinet.

His list of nominees, which has been lampooned by analysts, was presented to lawmakers yesterday, five months after he was re-elected.

Nigeria’s currency has hovered around 360 per dollar since late 2017, a boon for traders, but not the economy, which is growing at a slower pace than the population.

AfCFTA: We have developed strategies to optimise benefits - Buhari Tony Ailemen, Abuja

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resident Muhammadu Buhari on Tuesday said Nigeria had developed strategies to optimise benefits from the newly signed Africa Continental Free Trade Area (AfCFTA) agreement.

The President stated this in Abuja at an audience with the National Executive Council of the National Union of Textile, Garment and Tailoring Workers led by its president, John Adaji, at the State House.

Speaking on the AfCFTA, which Nigeria recently signed, President Buhari said, “We have developed a comprehensive strategy to fully optimise the benefits” with necessary safeguards in place.

Buhari said in the last four years, the Federal Government deployed limited resources to job-creating sectors like agriculture and mining.

The President also attributed the economic problems in the North, including rise in crimes in the region, to the closure of textile factories, especially in the North.

“We promoted policies that will support local industries such as import restrictions. We introduced programmes that provided affordable and accessible capital to both large and cottage @Businessdayng

industries.

“We also introduced Executive Orders that encouraged the procurement of Made in Nigeria goods and services,” the President said.

According to Buhari, his administration would continue to support the above policies and programmes in the years ahead, stressing: “We will not allow Nigeria to return to the days of exporting jobs through the importation of food and clothing items which can be produced locally. We owe this to the over 200 million Nigerians.”

He said the textile and garmenting sector had the potential to create millions of jobs and would therefore remain one of the priority sectors for the administration.

Referring to his recent directive to all government uniformed institutions to use locally produced garments, the President said unbelievable number of jobs would be created when the military, police, para-military organisations including the National Youth Service Corps (NYSC), fully patronise local industries.

He urged state governments to buy into this policy for their schools, hospitals and other institutions, saying, “Our priority remains to create jobs in Africa for Africans using a large proportion of African raw materials.”

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Thursday 25 July 2019

BUSINESS DAY

news

Nigeria hopes for new wave of investments in Fintech with Interswitch listing Jumoke Akiyode-Lawanson

… analysts say listing could be exit strategy for foreign investors

frican focused integrated digital payments and commerce company, Interswitch, is paving the way for proper valuation and investment for other payment service providers and Fintech companies, as it resumed plans to list on the Nigerian and London stock exchanges, a process halted two years ago due to Nigeria’s economic instability.

The company is reported to be making major steps towards IPO listing after it hired JP Morgan Chase & Co., Citigroup Inc. and Standard Bank Group

Limited as financial advisers.

Although Interswitch had in 2015 announced a dual listing by 2017, the plan was cancelled as a result of naira devaluation against foreign exchange scarcity at the time.

However, Mitchell Alegbe, CEO, Interswitch, had in 2017, assured stakeholders that plan to list the company shares were still on the table.

Market analysts say that if the company in fact goes ahead to list on either or both stock exchanges, Interswitch will be creating an avenue for a new wave of deep pocket Nigerians to invest in publicly listed fi-

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nancial technology companies withbettervaluation.Itmayalso promptsmalleronlinepayment processing companies with great impact like Flutterwave, Paystack,VoguePay,E-Tranzact, andotherstomovetothecapital market.

Others say this may be the best exit strategy for initial investors.

“This will open up local investment options in ICT, because listing will help the Nigerian and global community better understand the value of technology start-ups,” Segun Arogundade,technologyindustry analyst said.

Private equity group, Helios Investment Partners, owns about 70 percent of Interswitch.

Other shareholders include South Africa’s Adlevo Capital Managers LLC and the InternationalFinanceCorp,aunitofthe World Bank.

BusinessDay recalls that about four years ago, Helios Investment Partners, a major investor in Helios Towers, a telecoms infrastructure firm in Nigeria, sold its stakes and operational assets including 1,211 towers to IHS Towers.

“The struggle to support capital expenditure (CAPEX), ridedowndebtandfundbudget

is becoming a priority, and companies playing in the telecoms and Fintech industries, which is a tough market, have no other choice but to seek to raise funds through the capital market,” Olusola Teniola, president, Association of Telecommunications Companies of Nigeria (ATCON), told BusinessDay. According to Teniola, Fintechs are not ignorant of the threats that are going to happen when Payment Service Banks (PSBs) become operational and so, they need to increase capex to compete favourably in the market.

FG seeks partnership against child labour JOSHUA BASSEY

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he Federal Government called for an effective collaboration of market authorities in the country in the fight against the growing cases of forced/child labour.

Permanent secretary, Federal Ministry of Labour and Employment, William Alo, made the call at a rally organised by the ministry in Abuja to create awareness against child labour in Nigeria.

According to the International Labour Organisation (ILO), child labour constitutes any work done that deprives children of their childhood, their potentials and dignity, and that is harmful to their physical, moral and mental development, such as hawking, among others. These are, however, commonplace in Nigeria.

But Alo is of the opinion that market authorities could fight child labour by disallowing child labour in the markets and taking practical steps to ensure that children are in school or attend vocational training.

He also encouraged market authorities to report incidences of child labour to the ministry for necessary action.

He said even if children had to be in market places assisting their parents/guardians, they should not be denied basic education.

Speaking also, Abubakar Muazu, the permanent secretary, ministry of mines and steel development, harped on the need for the adequate development of a child saying this should be the priority of any country, because children constituted the future of a people.

He encouraged stakeholders to accord the necessary importance and attention to the issues of child labour.

In his contribution, Mohammed Bello permanent secretary, ministry of agriculture and rural development, condemned child labour, and called for proper legislation against it in Nigeria.

Dennis Zulu, country director of the International Labour Organisation, (ILO) identified poverty as the primary cause of child labour.

He said a lot could be done to ensure that children are not subjected to child labour. “We need to ensure that our children go to school and have the opportunity to play and enjoy themselves as children and this cannot be achieved if they are involved in child labour”, Zulu said. www.businessday.ng

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“Digital payment service providers like Interswitch need tobeabletoofferend-to-endsolutions,considerotherportfolios and not just be a payment gateway. Already, telcos and e-commerce platforms have resorted todifferent capitalmarkets, both locally and internationally. Until thereareothermeansoffunding capex, companies that want to competewillatsomepointneed to go into the capital market,” Teniola said.

The payment company, headquartered in Lagos, Nigeria,isvaluedat$1.3billionto$1.5 billion, according to Bloomberg report.

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Revisiting Nigeria’s past to better its future: History series 101

Remi Adekoya

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people without knowledge of their past history is like a tree without roots,’ said Marcus Garvey, the legendary black-emancipation activist. Nigerian society today resembles the kind of tree Garvey spoke of. Not because Nigerians are allergic to learning history, but because their leaders are averse to teaching it.

After finishing a (good)secondary school in Nigeria, my knowledge of our history was limited to a few calendar events we were made to cram; 1914 -amalgamation of Northern and Southern Nigeria, 1954 – introduction of Lyttleton Constitution,1960– Independence. No critical analysis, however basic, of these major events; just remember the dates and move on. This is no coincidence. Those who run Nigeria often genuinely believe the country’s history is so painful and divisive it is best recalled as briefly and superficially as possible.

Deeper discussions only re-open old wounds. January 1966. July 1966. Biafra.

Starving children. Slaughtered citizens.

Who caused it? You people caused it. No, you people caused it. No, no, let’s just forget the past and focus on the future.

This rationale cannot be so easily dismissed. I understand the fear and logic behind it. In fact, this approach can be plausibly defended as the most responsible one in a polarized society with a traumatic history. The problem, however, is that if a state does not meaningfully educate its citizenry on their history, others, often of an opportunistic bent, will step in to fill that void. After

all, anyone with a basic knowledge of propaganda knows that controlling perceptions of the past is the first step to shaping interpretations of the present.

The neglect of in-depth history in Nigeria’s curriculum enables all sorts of conspiratorial gibberish find easy prey on Nigerian social media, age-old Fulani plans for this, Igbo agendas for that, Yoruba desires for what-not. I won’t even talk about the articles I’ve read in major Nigerian newspapers by well-known figures citing ‘quotes’ from Awolowo, Azikiwe or Bello that I cannot for the love of me locate in any credible historical source even though I spent four years gathering every available utterance these men ever made! Over 70 years ago, George Orwell said ‘the very concept of objective truth is fading out of the world. Lies will pass into history.’

The internet has only made things worse in this respect.

However, rather than merely complain, I am hoping a column series based on my doctoral research into Nigeria’s political history leading up till the civil war might prove useful here. Recalling the roots of past ethnic strife, can, at the very least, suggest errors to forgo.

It might also help us better understand why the foundations of post-colonial Nigeria have always been so shaky. So, let us start with 1930s Nigeria.

Nationalist beginnings Although nationalist-minded political movements such as Herbert Macauley’s Nigerian National Democratic Party (NNDP) had been active from the 1920s, the Nigerian Youth Movement (NYM), formally established in 1936, was the first organization to successfully recruit politically-conscious nationalists from various parts of Nigeria. NYM wanted to foster ‘a sense of common nationalism’ among ‘the conglomerate of peoples who inhabit Nigeria.’

Obafemi Awolowo was a nearly member while Nnamdi Azikiwe joined in 1937.

Zik helped broaden NYM’s appeal by popularizing it amongst Igbos through his newspaper, the West African Pilot.

However, while some emphasize NYM’s ‘national’ outlook, it was, in actuality, a predominantly Southern Nigerian movement whose pan-Nigerian message never gained much traction in Northern Nigeria. Historians offer a number of reasons, ranging from low education levels in the region to the combined hostility of its powerful emirs and the British to NYM operating there.

Nevertheless, while it is a stretch to characterize NYM as a ‘national’ movement, it did offer promising beginnings, especially as World War II provided favourable conditions for Nigerian nationalism.

Prior to WWII, regular Nigerians were isolated from the outside world.

Only a small group had experienced life outside Nigeria, mostly those who had studied in the West. Regular Nigerians, whose contacts with Brits were limited to colonial officials, considered all white people powerful. This changed as Nigerians recruited into Western Allied Forces encountered regular white soldiers who were farmers, traders or even servants back in their countries. Also, Nigerians back home observed regular white soldiers passing through Nigeria, looking quite ordinary and bereft of special privileges. These experiences helped demystify white people, which in turn made the nationalists’ claims that the white man could be chased away from Nigeria more believable to the average Nigerian. Many subsequently joined the independence cause.

However, while NYM agitated for increased rights for Nigerians, personal rivalries intensified within the organization, most consequentially between Azikiwe and Ernest Ikoli, another NYM leader. In 1938, Ikoli had founded the Daily Service, a nationalist newspaper which became direct competition for Azikiwe’s West African Pilot, a fact Zik is said to have strongly resented, especially considering the small reading public back then.

Internal squabbles eventually led to Azikiwe quitting NYM in 1941. In a sign of things to come, Zik accused his rivals

‘

The neglect of in-depth history in Nigeria’s curriculum enables all sorts of conspiratorial gibberish find easy prey on Nigerian social media

of ethnic chauvinism and vice versa.

Igbo NYM members stood firmly behind Zik during the conflict and when he left, they went with him. Despite efforts by Awo and others to keep NYM alive and ethnically-diverse, after Zik’s departure, it essentially became a Yoruba-dominated movement that lost any claim to a ‘national’ character.

In 1944, Azikiwe co-founded the National Council for Nigeria and the Cameroons (NCNC), a new organization uniting various ethnic and trade unions into a political party vowing to achieve independence. Meanwhile, the NYM saga had left a lasting impression on Yorubas in the movement, including Awolowo who suggested the loyalty Igbo NYM members showed Azikiwe in his rivalry with Ikoli (who was from a minority group) stemmed not from ideological, but ethnic, affiliation.

Awo would later use the NYM experience as a justificatory argument for his postulation that Nigeria be a federal rather than centralized unitary state. In his autobiography, he argued federalism was necessary to avoid the country being ‘dominated’ by one ethnic group from the centre. Awo’s other main argument for federalism was that Nigeria’s various groups which he considered nations in of themselves were civilizationally incompatible and should be allowed develop as independently of each other as possible within Nigeria. Zik’s position wavered from initially supporting federalism in the early 1940s to later backing a unitary solution before eventually reverting back to federalism. As for Ahmadu Bello, his views will surface when we arrive in the 1950s which is when he became a prominent voice.

Note: The rest of this article continues in the online edition of Business Day @ https://businessday.ng/ Dr Adekoya is a journalist and political scientist. He has written for the UK Guardian, Foreign Policy, Foreign Affairs,Washington Post and Politico among others. He tweets @ RemiAdekoya1

The city we need is affordable

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igerians pay dearly for living in a country that has some of the worst cities for humans to live in the world.

They pay for the lack of infrastructure through the number of hours spent in traffic jams and for the health challenges resulting from a chaotic environment, poor planning and a total lack of facilities.

The stress of dealing with the myriad of challenges above brings the country’s life expectancy rate to one of the lowest in the world. For the many low-income earners in the country, meeting the basic needs of life is almost like passing though the proverbial eye of a needle.

Lagos State, for example, was ranked the sixth-cheapest city in the world to live in, but the Economist Intelligence Unit said the business hub of Nigeria is also among the world’s cities that have faced political, security and infrastructural challenges, and as such there is some correlation between the cost of living ranking and its sister ranking, the liveability survey.

“Put simply, cheaper cities also tend to be less liveable,” the Economist Intelligence Unit writes.

According to the 2018 Global Liveability Index

by The Economist Intelligence Unit in collaboration with the World Bank, Lagos occupied the 138th position out of the 140 cities considered for the ranking.

This made it the third-worst city for humans to live in the world, outperforming only Dhaka in Bangladesh and Damascus in war-torn Syria.

Take a typical scenario, Adeyemi Abimbola is a 42-year-old single mother who resides in Ikorodu,

a city located in the north-east of Lagos State, but works as a Customer Service Representative in a super market at the high-end residential district of Lekki.

Due to her low income of N50,000 ($138) per month, she has been unable to secure a rental accommodation on the Island. The price of a single room in the neighborhood goes for N1 million and above.

The lady is now looking much older than her age, owing to the stress from the long hours of travel to work and even worse for her, now that her husband is late she has also had to add taking her children to school.

The lack of a well-structured transport system in the city is the reason why Abimbola has to set out on time to drop her kids to school to ensure they don’t arrive school late daily.

The hardworking lady travels a total of 4 to 5 hours every day, and the many days she is unlucky especially in the wet season, the time of her trip within Lagos can be substantially more especially on rainy days.

Narrating her frustration, she confirms that “I sleep on the bus almost every day, and I wish my community was well planned, at least the closest primary school to my house wouldn’t be up to an hour’s drive and the stress of taking my children to school would have been lifted off me,” While other countries around the world are making great strides in building liveable and affordable cities, Nigeria, Africa’s most populous nation, remains a baby who is still learning to crawl and is constantly trying to play catch up.

The high cost of living in the country, coupled

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with the lack of infrastructure, improper town planning and poor healthcare system, make Nigeria uncompetitive among its peers.

The World Economic Forum (WEF)’s 2016-17 global competitiveness index ranked Nigeria’s infrastructure low (132 out of 138 countries), and according to its 2016 Executive Opinion Survey, the poor supply of infrastructure is one of the biggest constraints of doing business in the country.

According to the Nigeria Labour Congress (NLC), the country needs about $3 trillion in the next 26 years to bridge the infrastructure gap and the projection by the United Nations that Nigeria will be the third-most populous nation in the world by the year 2050 will surely put more pressure on the country and its resources.

Poor construction, bad maintenance, corruption and a perceived lack of investor security deter many potential investors from coming into the country and so the government depends largely on borrowing to fund its budget deficit.

According to the 2018 World Economic Forum Global Competitiveness Report, some of the worst roads in Africa are found in Nigeria.

The international non-profit organisation ranked over 140 countries based on the quality (extensiveness and condition) of their road infrastructure. The survey saw Africa’s most populous nation occupying the bottom of the region’s pyramid alongside its neighbour, Cameroon, who ranked 126 globally and scored 2.6 out of 7.

Nigeria followed in line as it ranked 127 in the world with a score of 2.5.

This was despite Namibia’s record in the re-

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CHUDI S. UBOSI (fnivs) view period, as the South West African country beat China and India with a rank of 31 out of 137 countries (with a score of 5.0 out of 7), leaving global economic giants like China and India to rank 42 and 55, respectively.

South Africa was also able to make it as the last African country to be in the top 50 list. It ranked 50 globally and sixth across the continent with a score of 4.4.

There are many consequences of a poor road network in Nigeria, the most grievous being the danger it poses to human lives. In July 2017 alone, 13 people on the average died from vehicle accidents each day, with over 1,200 vehicles involved in mishaps during the month.

Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng Ubosi is an estate surveyor and valuer and a partner at Ubosi Eleh & Co and a Fellow of the Nigerian Institution of Estate Surveyors and Valuers (NIESV).

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BUSINESS DAY

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Only the paranoid will survive Buhari’s Nigeria The Public Sphere

CHIDO NWAKANMA

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ulani expansionists. Bandits.

Miyetti Allah. Boko Haram.

The strange formation of vigilantes by Fulani in other people’s homesteads. Inflation. Economic uncertainty. The confrontation between the Shiites or the Islamic Movement of Nigeria and the Federal Government.

Citizens are worried. You should worry. However, you should do more than worry. You should develop a healthy paranoia about our country.

The oxymoron of “healthy paranoia” draws on the lessons from Andy Grove’s book, Only the paranoid survive: how to exploit the crisis points that challenge every company.

Andrew S. Grove, an immigrant from Hungary, arrived in the United States in 1956. A co-founder of Intel, he was president in 1979 and CEO in 1987. TimeMagazine named him Man of the Year in 1997. He stepped down as CEO of Intel and retired as board chairman in 2004. He taught at the Stanford University Graduate School of Business for 24 years. He died in 2016. The world remembers him for leading Intel through significant changes and evolution in the computer industry, changing from making memory chips that could

not compete against the Japanese, to a microprocessor firm.

A significant coinage and lesson from Grove is the idea of strategic inflection points (SIP) and managing them. A SIP is a decisive moment in the course of an entity that signals a significant change.

The return of Buhari is a strategic inflection point for Nigeria and Nigerians. It brought the first recession in 25 years. As it was in 1984, so, too, in 2015 and 2019.

Buhari means hardship, lack of vision and vacuity. RUGA and the fulanisation threat are additional inflection points as is the deteriorating economy.

Lesson one is to adopt emotional detachment about your state, your finances and the state of the country. It is difficult, but removing emotions would allow clear-headed analyses and plans, for individuals, groups and geopolitical regions. Fear, worry, doubt would not cut it now.

Actively seek information and knowledge. Open communication is critical. Sift carefully the information you consume in this social media age.

Nevertheless, you need information and communication with relevant stakeholders.

Note the threats. Acquire new skills, pay attention to your personal and organisational economy lest the ground shifts underneath you with new practices and skills. Note that opportunities crop up even in dire situations such as confronts Nigeria today. Cowbell Milk entered and thrived by responding creatively to the challenge of energy and the reduced purchasing power of citizens.

Do not be in a hurry to intellectualise and rationalise, dismissing threats as “impossible” or it cannot happen in Nigeria. Many things we thought unlikely in Nigeria are happening as the days

unfold. Even so, resist the ethnicization trap. Nigeria’s problems are more profound and require building on our diversity, rather than widening it as is currently happening.

Notice your environment and circumstances more than ever before. Eternal vigilance is the price of liberty. Who are these people vending knickknacks and emerging from the shadows? Why are they so many now? Is it merely economic, or are they foot soldiers for an evil purpose?

SIPS confuse businesses, individuals and groups. We must remain focused.

We want a Nigeria that works, either as one unit or a different configuration that enables constituents to achieve their vision. Southern Nigeria must pay attention and remove the tinted glasses with which it views Nigeria. The “next level” certainly means different things to various parts of Nigeria. Be paranoid about Nigeria today.

These are exciting times in Nigeria. It fits, therefore, to remember the quotation by Albert Camus, the French writer, absurdist, winner of the Nobel Prize. Camus wrote the famous work, The Plague, among others. He stated, “An oriental wise man always used to ask the divinity in his prayers to be so kind as to spare him from living in an interesting era. As we are not wise, the divinity has not spared us, and we are living in an interesting era. In any case, our era forces us to take an interest in it. The writers of today know this. If they speak up, they are criticised and attacked. If they become modest and keep silent, they are vociferously blamed for their silence.”

The “oriental wise man” in Camus’s statement refers to the now apocryphal statement credited as a Chinese curse

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As it was in 1984, so, too, in 2015 and 2019.

Buhari means hardship, lack of vision and vacuity

saying, “May you live in interesting times.” It refers to periods of uncertainty, turmoil, eruptions and social disorder, war and rumours of war.

Since INEC affirmed the re-election of PMB, happenings in Nigeria have been saddening. There is the talk of Fulanisation and Islamisation. Then, as if to confirm former President Olusegun Obasanjo’s allegations, an unelected high official announced and the Presidency tried to justify a land grab scheme to favour the Fulani. Before then, the former minister of education took up the portfolio of his Information counterpart to announce that government had licensed a radio station exclusively for the Fulani.

Insecurity reigns. PMB showed the character of his government on the matter of insecurity in two recent statements. In his Easter message on April 19, the president lamented the acute insecurity in our land.

PMB stated: “Our nation is currently gripped with gloom over unfortunate killings, kidnappings and violence, as seen in the recent tragic incidents in some states of the federation.” He then pledged that the Federal Government would not kowtow to the nihilists.

On July 16, responding to the loud outrage over the killing of Mrs Funke Olakunrin, daughter of Afenifere leader Chief Reuben Fasoranti, PMB now claimed that the insecurity concerned “isolated incidents.”

Be paranoid about Nigeria.

Nwakanma is a Visiting Member of the BusinessDay Editorial Board and serves on the Adjunct Faculty at the School of Media and Communication, Pan Atlantic University, Lagos. Email chidonwakanma@gmail.com.

Lagos, the rains, the roads and the people

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hat it has been raining profoundly in Lagos, for quite sometimes would be an understatement. The volume of rains being experienced lately at the ‘Center of Excellence’ corroborates an earlier forecast by the Nigerian Meteorological Agency (NiMet) concerning “extended rains for areas in and around Adamawa, Ogun, Edo, Niger Delta and low-lying areas such as Lagos”.

A critical feature of Lagos topography is that the state is essentially made up of low lying terrain up to 0.4 percent below the sea level.

Naturally, this arrangement is the source of huge drainage challenges that confront the state. If this is added to the volume of rain that is being experienced in the state lately, it would be realized that there is possibly no way there would not be flash flooding in Lagos.

Logically, when flash flooding occurs, one of the negative effects is that it washes away the surface of the roads, thereby making them almost impassable. This often results into avoidable gridlocks that make motoring a dreadful experience. Flash flooding; which is mostly a consequence of Lagos’ peculiar topography is, therefore, one of the factors responsible for frequent damages of Lagos roads. This explains why the Lagos state government regularly does palliative works on roads across the state.

However, irrespective of natural, scientific and other such plausible factors that complicates traffic experience on Lagos roads, it remains the primary duty of government to ensure that the burdens of the people, especially in terms of reducing travel time is reduced to the barest level.

Well, the good thing is that the current administration of Mr. Babajide Olusola Sanwo-Olu clearly understands the place of the people in a democracy. Being a government that came

into office through an overwhelming mandate of the people, one principal thing that is held sacrosanct by the administration is the wellbeing of the people.

Considering most of his public pronouncements and actions since he assumed office as the 15th governor of Lagos State, Mr. Sanwo-Olu has evidently demonstrated that his main goal in government is to improve the living condition of the people. On his very first day in office, the governor visited the Staff Bus Pool at the Secretariat, Alausa and promised to boost its fleet with brand new busses. Three days after he made the promise, 35 brand new state of the art busses were promptly added into the staff bus fleet. The main purpose, of course, is to make life more comfortable for the staff.

It is as a result of the Sanwo-Olu administration’s objective of making life more meaningful to the people that it made Transportation and Traffic Management the first cardinal aspect of its THEMES agenda. Since assuming office, the government has not only been taking the talk about improving traffic situation in the state, it has also been walking the talk.

For instance, on his 5th day in office, precisely on Sunday, June 2nd, Governor Sanwo-Olu, in the company of his deputy, Dr. Kadiri Obafemi Hamzat, visited the long abandoned Lagos-Badagry Expressway and pledged the commitment of his administration to resume reconstruction work on this all important road before the end of June. True to his words, three weeks after he made the promise, the Sanwo-Olu administration actually flagged-off commencement of work on the international gateway. Again, as always, the primary of objective is to bring soccour to Lagos residents who live along the axis.

It is in further demonstration of its people

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centric philosophy that the Sanwo-Olu administration, which actually came on board in the thick of the rainy season, has made continuous rehabilitation of roads a core mandate. As earlier stated, in Lagos, the rainy season often has serious implications for human and vehicular movement as significant portions of the roads are largely damaged by the rains. But in-spite of the rains, the Sanwo-Olu administration has empowered the Lagos State Public Works Corporation to fix bad portions of roads across the state.

Thus, the Public Works Corporation has been able to fix all its equipment while its plant is now fully up and running. This has enabled the corporation to begin palliative works on major roads in places such as Ogudu, Iju, Ilupeju by Ilupeju Secondary School, Allen Avenue in Ikeja, Ikotun- Igando axis, Apapa, Jibowu, Ikorodu Road, parts of Ikorodu town, Itoikin, Ahmadu Bello Way, Victoria Island, Alfred Rewane Road, Ikoyi among others.

It is important to stress that personnel of the corporation work 24 hours round the clock in order to ensure speedy intervention. They work at nights mostly in high density areas of the state to ensure that the traffic situation is not further compounded. By defying the prolonged rainy season in its road rehabilitation’s quest, the Sanwo-Olu administration has disregarded a universally held belief that road maintenance work is seldom done during the rains.

Presently, the state government has identified about 60 traffic gridlocks in the state and it is working round the clock to ensure that gridlock red spots such as Third Mainland Bridge and Lekki-Ikoyi/Admiralty Way and Lekki Toll Plaza, among others would be urgently tackled and resolved. This informed the current study the state government has embarked upon concern-

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Tayo Ogunbiyi ing how best to tackle the perennial Lekki toll gate traffic.

Also, Governor Sanwo-Olu has charged the Lagos State Traffic Management Authority, LASTMA, to effectively carry out their functions by ensuring strict compliance with all extant traffic rules and regulations as prescribed in the enabling law. Similarly, the governor announced 100% increase in the allowances of LASTMA officials to encourage and motivate them in the discharge of their duties.

Meanwhile, Governor Sanwo-Olu has assured Lagosians on the completion of all outstanding road projects in the state. The Governor made this assurance during a recent work visit to the Imota Rice Mills in Ikorodu division of the state. Towards this end, Sanwo-Olu assured Ikorodu residents that contractors would soon be mobilized to begin work on the Igbogbo and Agric/Isawo Roads as soon as there was a break in rainfall.

Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng Ogunbiyi is of the Ministry of Information & Strategy, Alausa, Ikeja

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Thursday 25 July 2019

BUSINESS DAY

Editorial Publisher/CEO

Of rape and abuse, oh justice, where is thy truth?

editor Patrick Atuanya

rom homes, religious houses, schools, hospitals, day care centres to mention a few, rape is daily being perpetuated as reported on social media with horrendous videos and pictures as evidence but sadly, only a few get to be heard and a lesser few ever find justice.

According to Women AT Risk International Foundation, WARIF, Findings from a National Survey carried out in 2014 on Violence Against Children in Nigeria confirmed one in four females reported experiencing sexual violence in childhood with approximately 70% reporting more than one incident of sexual violence. In the same study, it was found that 24.8% of females’ ages 18 to 24 years experienced sexual abuse prior to age 18 of which 5.0% sought help, with only 3.5% receiving any services.

The numbers have increased even in recent times and prior to now, the uncouth perpetuators often went scot free but

Frank Aigbogun

DEPUTY EDITORS John Osadolor, Abuja NEWS EDITOR Chuks Oluigbo EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure GENERAL MANAGER, ADVERT Adeola Ajewole ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso BUSINESS DEVELOPMENT MANAGER (South East, South South) Patrick Ijegbai CIRCULATION MANAGER John Okpaire DIGITAL SALES MANAGER Linda Ochugbua ASSIST. SUBSCRIPTIONS MANAGER Florence Kadiri GM, BUSINESS DEVELOPMENT (North)

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from recent happenings, it is certainly not going to be ‘business’ as usual. People are finding their voices, victims are opening up about their struggles and others are receiving strength to voice out, they are voicing out and authorities concerned are beginning to listen.

Recently, the First Lady of Nigeria, Aisha Muhammadu Buhari has been championing the fight against rape, her hash tags: #JusticeForRapeVictims , #SayNoToRape and #EveryoneGetInvolved tells it all. This came after a clergy was sentenced to 12 years imprisonment for raping a 14 year old girl and an Islamic cleric who raped a 16 year old and claimed she’s his wife was arrested.

It isn’t all gor y for ra p e v i c t i m s a s f o r i n stance, in Lagos state, the lines to call for child abus e are 08085753932 and 08102678442 and for dom e stic v iolen c e, you h av e 0 8 0 5 7 5 4 2 2 6 6 a n d 08102678443. There is also the toll-free emergency line 112, to report cases of rape, defilement and other sexual assaults.

There should be more avenues for anonymous feedback so cases of rape can be reported anonymously and thoroughly investigated.

The s o cial me dia has helped on this matter but has also given voice to obtuse contributions from supporters of chauvinism.

One ver y significant thing is that, as protection and guidance is given to the girl child, we must not forget about the boys who later grow up to become men.

They should be trained and tutored from an early age on how to love, protect and dearly respect every woman.

To everyone condemning a survivor for speaking up and questioning their timing for coming out, it is only wise to speak with nous because no one is endorsed to determine the time a survivor is brave enough to speak out, you know why?

It is simply because justice for the abused may delay but it will surely come. Bill Cosby’s case we can never forget.

Also, know that perpetuators will do anything and everything to kill the narrative brought against

them so before you jump on littering compromising cheap-talks pause, before you talk think, before you defend, reason!

To the abused, you are not alone, someday; somehow, your truth will birth victory, victory for you and other abused who will find strength because you inspired them to know that the situation only made them become witnesses to justice.

To the government, if you are truly for the people, then be by the people in integrity and truth.

To the abus er...STOP! or else, sooner than you think, you will be ‘served’ and your pummel will arrive unexpectedly and invited without your acquiescence.

To religious leaders, because you occupy a sensitive position in the society, because your office requires you are only on the side of truth, because the supreme one who you ‘report’ to and profess to be like requires honesty from you, therefore, in all you do, say or promote, let that mind which is in HIM, be in you.

Bashir Ibrahim Hassan

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Thursday 25 July 2019

BUSINESS DAY

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Milk ban could worsen the herder insecurity crisis

OLA BELLO

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he Central Bank of Nigeria’s (CBN)impending forex ban on milk imports could worsen the herdsmen-induced insecurity in Nigeria. Ostensibly communicated to manufacturers by the apex bank in meetings, this will exclude the $1.2b of milk imports from the official forex window. Dairy products will join forty-seven items already excluded from the CBN-supplied forex.

At face value, it might seem positive for growing Nigeria’s dairy production. However, does this meet the test of holistic and national economic-security thinking? The policy may prove economically illiterate and could undermine President Buhari’s bid to support cattle-rearing and associated jobs.

Cart before the horse Nigeria’s herder-linked insecurity is the elephant in the room. Government-led initiatives to help herders and local dairy production will benefit frominclusive stakeholder dialogues. The abruptness of the CBN’s announcement, perhaps wellintentioned, is wrong-headed. There are clear facts to support this assertion.

First, the exclusion aims is to encourage dairy producers to invest in local ranches.

The problem though is that Nigeria’s cattle are among the least prolific in the world.

This explains the embrace of imported milk. The country failed to modernise itsarchaic system of grazing cattle herds over vast distances. Much of the animals’ intakes are expended on excruciating commutes.

It is no surprise that the cattle produce only a fraction of production in ranchbased systems and cooler climates like Australia, Canada and New Zealand.

Nigerian cows produce 1.5 to 2 litres of milk per day compared to 100 litres in some countries. Even Kenya’s, which is more temperate, produce up to 30 litres per day. Nigeria’s beef quality, as for much of West Africa, is considered among the worst globally.

Contrast this to Argentina. The country leads quality beef exports with its optimal conditions. Its cows undertake minimal

to no commute, eschew stress and hence efficiently use consumptions. They deliver milk and beef so tender that they areglobally coveted. New Zealand accounts for 20.5% of world milk exports valued at $5.5 Billion. The US earns $7.3 Billion for its 14.7% share of meat exports. Nigeria barely produce enough to feed its 200 million-strong population. Our approach to cattle-rearing is stuck in the past.

Second, Nigeria’s high energy costswill undermine fresh milk preservation which this policy shift requires. For decades, dry (powder) milk has been the default choice for Nigerians. They are more affordable and durable given epileptic power supply. The generations-long dependence on dry milk intensified from the late 1980s, in tandem with the erratic grid-supplied electricity. If the CBNproceeds without improvement in energy access, Nigerians will struggle to store milk safely in a country where power access is at a paltry 45%.

Besides the higher cost faced by consumers, seriouspublic health concerns also lurk. Reliable refrigeration of dairies for human consumption is key. Moreover, the important nutritional gap filledby powder milk use by vulnerable Nigerians is grossly underappreciated. Lower income homes buy dry milk in smaller, more affordable sachets, thereby making this component of a healthy diet widely available to millions. Also germane is the well-being and safety of infants in poorer families. These rely on locally produced powder to meet infant milk needs with bottle-feeding. Even without more of the counter-productive policies, 7.3 million Nigerian children under the age of fivetoday suffer from Severe Acute Malnutrition!

Third, if the government’s aim is to help the cattle-rearing industry, as any reasonable government should, then Buhari and CBN governor Emefiele should be careful what they wish for. Preparing the ground adequately will be far better than playing to the gallery to little positive effect. The strong-arming of milk producers to redirect resources into inefficient milk production will likely provoke dire consequences.

Sinking, not waving On the one hand, current milk producers will be likely forced to exit because of sub-optimal conditions that they are saddled with. If balanced, workable proposals for improving local milk production are not forthcoming from government, more operational handicaps should not be grafted onto existing constraints. On the other hand, those not forced out will likely turn to capital-intensive methods. Precisely because ranching to meet the modern competitive needs of big dairy producers is a technology-intensive industrial activity.

Having been cajoled into ranching, better groomed cattle owned by dairy producers will deliver bigger, better beef. They will likely sink small and medium scale herders which government purports to help. Undermined in this way, herdsmen’s sense of insecurity is likely to fester. Forcing inefficient local milk production onto big dairy producers is liable to atwin deficit: that of economic underperformance and heightened security vulnerabilities. The dairy operators, their efficiency and costsavings from imported milk undercut in the meantime, will still be unable to turn Nigeria, given its hotter climate, into a milkexporting superpower!

I find it hard to believe that this is the unintended consequences that the government is contriving to achieve. Particularly in light of Nigeria’s recent signature of the Africa Continental Free Trade Agreement (AfCFTA), we need to proceed cautiously.

Local food processing is a relativelylowhanging fruit for Nigeria in terms of developing competitive clusters to maximise AfCFTA. Rash protectionist lurches, including imported milk ban without viable alternatives, are a quick way for the ship of Nigeria’s continental trade to start taking in water before it has even sailed.

On milk and much else, we will be welladvised not to foolishly lock-in inefficiencies with ill-conceived policies. That will undermine stakeholders, leave us divided and unable to leverage comparative advantages. Short of targeted local production, government-engineered ranching for milk hardly adds-up economically. With diligence, we could perhaps ranchour way to competitive beef production. Which isn’t the same as the dairies now in the CBN’s cross-hairs.

Doing our homework The government can create enabling conditions with well-thought-out, comprehensive policy frames to support privatesector-led ranching. This will require a lot more in the way of studying and analysing planned actions and likely multi-vector consequences, including on security.

Evidence based policymaking is required on a level not yet seenunder successive Nigerian administrations.

Also needed is inclusive stakeholder dialogue. States will have to be properly consulted. The governors are legally vested with powers to control all land within their boundaries by the Land Use Act. The private sector, expected to spearhead investments, must be carried along. We need to think carefully about incentives for all impacted stakeholders, especially communities that choose to host ranches.

Recent proposals to consider token payments for grazing-land access should not

‘

Nigeria will profit handsomely when policymakers and elected representatives – including the CBN - see reason for policies to emerge in consultation, not decreed by pronouncement or yanked from the air

be dismissed. It is one promising avenue to create shared-value around grazing. Security guarantees with shared responsibilities are just as essential.

The recent spate of kidnapping and killings allegedly masterminded by rogue elements or cohorts within Fulani cattleherding groups needs creative management by government. Between 2016 and 2018, about 3,641 persons were killed in clashes between herdsmen and farmers.

57% of these deaths occurred in 2018 alone. About 685 persons were reportedly kidnapped in the first quarter of 2019, with roughly 546 of these linked to Fulani herdsmen.

Next level rhetoric, mounting anxiety Nigerians are anxious about herdsmen and broader insecurity. The explanations are socio-economic, physical as well as psychological. Policy pronouncements, including those on supposedly routine economic policy-setting should be filtered through both economic and national security lenses. This is the 360 degree humansecurity-based policymaking required to meaningfully transform Nigeria.

The Buhari government’s rallying cry on taking Nigeria to the “next level” points in this direction. Though ultimately it demurs at the actual point of meeting the crucial tests of citizens’ voice as freedom and security. Subjecting all major government pronouncements to the requirement of policy evidence and citizen inputs and consultation, rather than handed down as whimsical imposition, will represent a welcome first step to resolve mounting challenges. This is the touchstone of sound and humane public policies framed by accountability ethos.

Nigeria will profit handsomely when policymakers and elected representatives – including the CBN - see reason for policies to emerge in consultation, not decreed by pronouncement or yanked from the air. Important policy proposals should not come out of the blues without due consultation with affected citizens.

We are ripe for a new normal in the broader arena of governance. Without joined-up thinking across security and economic governance, pronouncements such as the CBN’s on banning milk import may stoke future insecurity rather than provide needed economic succour in the immediate. This is the only viable route to inclusive national stability.

Dr Ola Bello is Executive Director, Good Governance Africa (GGA). He holds first class BSc Honours and Mphil and PhD degrees from University of Cambridge.

Ola is a member African Union’s technical advisory group on mining.

Conspiracy against retirees

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ometime in April at Foursquare City, Ogun State, it was a great reunion with my friend who would always host me to sumptuous meals at his comfortable home in Uyo, the Akwa Ibom State capital during my working days as a Federal Civil Servant in the twin states of Akwa Ibom and Cross River. He was in company of his friend.

He made complimentary remarks on my appearance. To him, I looked good. For confirmation, he still asked, “how is retirement life?” I gave a quick response, “interesting: life in retirement is good”, I eloquently affirmed.

He was excited and heartily glad probably because my response had fulfilled or satisfied a purpose. It was a message of hope and encouragement. He turned to his friend and said, “can you hear that?” The man, who looked pitifully worried, just nodded in the affirmative without uttering a word. He said that I should let his friend know that life in retirement is not after all a death sentence.

In fact, life in retirement is supposed to be good as it is a time of comfort, peace and rest. For those of us who were privileged to

occupy enviable positions or postings, it is indeed an end to malicious attacks, bitter envy and jealousy, destructive falsehood, it could be a cherished respite from boisterous and fastidious overlording principals (in respect of unity colleges), money-seeking auditors, stock-verifiers and inspectors.

Also, some of us who had early retirement could venture into new careers, business opportunities and having the rare honour of being in control of one’s time and destiny. For instance, on integrity and trust, I got two offers.

I was magnificently offered the position of a secretary in a hotel consultancy firm where I received appreciable sitting allowance; and recently a Ghanaian university appointed me as its agent in Nigeria. Not everyone could be this lucky.

So certainly, the fear is real. An average civil servant is overwhelmed with the fear of retirement. How could one cope without earning a salary when there is a myriad of commitments: family commitments of feeding, paying children’s school fees and other bills; the community commitments of

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paying security and development levies and the church commitments of having enough money to attend programmes and remaining a faithful worker in God’s vineyard.

Painfully, the fear has been aggravated by the deadly conspiracy of delay by National Pension Commission Pension(PenCom), Prnsion Funds Administrators(PFAs) and some of their dishonest staff in releasing the retirement entitlements: “accrued rights”, gratuities and pensions. This delay is wicked and callous as it has caused untimely death of many retirees.

It is, unequivocally, a conspiracy as it is alleged that the delay is deliberate. It is aimed at sending retirees to their early graves so that these perpetrators would have possession of their gratuities and pensions.

By 1st July, it was exactly one that my colleagues and I retired from the Federal Civil Service. We are still expecting our gratuities and pensions. One year of waiting and we are still counting! Sad, very sad!.

How would these authorities explain this abysmal negligence? This conspiracy has

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VINCENT AKINDELE not just started. Nigeria has been like this for years; a failed state. Things were equally bad under the People Democratic Party (PDP) led administration. People have argued that the All Progressives Congress (APC) led government should have taken proactive and drastic measures to correct these anomalies. They argue further that one expects the situation to change for the better since APC promised change.

One keeps on wondering; for how long would things continue this way? Who will take the bull by the horn to rescue the dying retirees? The APC led government should bring the promised change to fruition. Prompt payment of retirement benefits is not negotiable. It is a responsibility that must be performed with dignity, integrity and alacrity. This mess must stop. The time is now.

Vincent Akindele, Chief Executive Officer (CEO), Hind’s Fit Communication Ltd., Ibadan

@Businessdayng

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Thursday 25 July 2019

BUSINESS DAY

COMPANIES & MARKETS

COMPANY NEWS ANALYSIS INSIGHT

Nigeria hopes for new wave of investments in Fintech with Interswitch listing …Analysts say listing could be an exit strategy for foreign investors JUMOKE AKIYODE-LAWANSON

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frican focused integrated digital payments and commerce company, Interswitch is paving the way for proper valuation, and investment for other payment services providers and Fintech companies, after it resumed plans to list on the Nigerian and London Stock Exchange, a process that was halted two years ago due to Nigeria’s economic instability.

The company is reported to be making major steps towards IPO listing after it hired JP Morgan Chase & Co., Citigroup Inc., and Standard Bank Group Limited as financial advisers.

Although Interswitch had in 2015, announced a dual listing by 2017, the plan was canceled as a result of Naira devaluation foreign exchange scarcity at the time. However, Mitchell Alegbe, CEO Interswitch had in 2017, assured stakeholders that plan to list the company shares were still on the table.

Market analysts say that if the company in fact goes ahead to list on either or both stock exchange markets, Interswitch will be creating an avenue for a new wave of deep

pocket Nigerians to invest in publicly listed financial technology companies with better valuation. It may also prompt smaller online payment processing companies with great impact like Flutterwave, Paystack, VoguePay, E-Tranzact, and others to move to the capital market. Others say this may be the best exit strategy for initial investors.

“This will open up local investment options in ICT, because listing will help the Nigerian and global community better understand the value of technology startups,” Segun Arogundade, technology industry analyst said.

Private equity group, Helios Investment Partners owns about 70 percent of Interswitch. Other shareholders include South Africa’s Adlevo Capital Managers LLC and the International Finance Corp, a unit of the World Bank.

BusinessDay recalls that about four years ago, Helios Investment Partners, a major investor in Helios Towers, a telecoms infrastructure firm in Nigeria sold its stakes and operational assets including 1,211 towers to IHS Towers.

“The struggle to support capital expenditure (CAPEX), ride down debt and fund budget is becoming a priority, and companies playing in the tele-

L-R: Babafemi Olabiyi, chief marketing officer, OVH Energy; Bill Lenihan, CEO, Zola Electric; Huub Stokman, CEO, OVH Energy, and Abdallah Khamis, MD, Zola Electric Nigeria, at a retail partnership agreement meeting between Zola Electric and OVH Energy in Lagos

communications and Fintech industries which is a tough market, have no other choice but to seek to raise funds through the capital market,” Olusola Teniola, president, Association of Telecommunications Companies of Nigeria

(ATCON) told Businessday.

According to Teniola, Fintechs are not ignorant of the threats that are going to happen when Payment Service Banks (PSBs) become operational and so, they need to increase CAPEX to compete

favorably in the market.

“Digital payment service providers like Interswitch need to be able to offer end-to-end solutions, consider other portfolios and not just be a payment gateway. Already telcos and e-commerce platforms

have resorted to different capital markets both locally and internationally. Until there are other means of funding CAPEX, companies that want to compete, will at some point, need to go into the capital market,” Teniola said.

Transcorp Hotels spreads hospitality wings to Lagos …to position its two-tower edifice in Ikoyi ENDURANCE OKAFOR

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ranscorp Hotels, the hospitality arm of Transnational Corporation of Nigeria Plc. (Transcorp), has disclosed its plans to open a two-tower five-star hotel in Lagos.

The publicly quoted Transcorp made this known to BusinessDay at a parley attended by chief executive officers of its subsidiaries and other senior management staff, which took place on Tuesday in Lagos.

“With all due respect to all other hotels, there is room for an additional top hotel in Lagos; there is a lot of room for it, so we are bringing Transcorp Hotel to the city of excellence,” Owen Omogiafo, MD/CEO of Transcorp Hotels said.

Commissioned on the 21st of April, 1987, the Lagos

branch of Transcorp Hotel is going to be located in the heart of Ikoyi with the aim to add more glamour to the already glamorous Lagos.

“Our location is very strategic and for those that don’t know, it is going to be a twotower hotel; with one tower having 320 rooms and the other tower been a mixture of apartment and offices,” Omogiafo said.

The award-winning hospitality brand already has it presence in both Abuja and Calabar; the Transcorp Hilton Hotel, Abuja and the Transcorp Hotels Calabar.

The idea for a five-star hotel like Transcorp where government guests, business travelers and tourist could be lodged was conceived when the decision to relocate Nigeria’s capital from Lagos to Abuja was made.

Since 2005, when it beat a group of investors to emerge as core investor in the flagship of Nigerian hotels; the Nicon Hilton Hotel Abuja, now known as Transcorp Hilton Hotel, the company has continued to further a course that aims to reinvent the luxury hotel concept.

Since becoming the single largest investor in Transcorp Hilton Hotel in 2011, Transcorp Hotels has established a huge footprint in Nigeria’s high-end cities.

“There is a lot that we are exploring in our hotel business in terms of expansion, beyond just the traditional means of expansion, we are looking at a lot of strategies and when it is time we’ll share with the public,” Valentine Ozigbo, President/CEO of Transnational Corporation of Nigeria Plc., said.

A dive into the financials of Transcorp Hotels revealed that the hospitality company has a Compound annual growth rate (CAGR) of 5 percent for the last 4 years.

At the end of the first half of 2019, Transcorp Hotels reported a revenue growth rate of 16.5 percent on a yearon-year basis, from N8 billion in 2018 to N9.3 billion. Driven by a surge in its occupancy rate for both weekend and workdays.

Thus, its gross profit was up 18.9 percent from N5.8 billion a year ago to N6.9 billion in the review period.

The company expanded its Abuja branch, the Transcorp Hilton Hotel; with a cost of $100million. This drove its interest expense to N1.6 billion from N6 million reported for the same period of the preceding year.

Editor: LOLADE AKINMURELE (lolade.akinmurele@businessdayonline.com) Graphics: David Ogar

Thursday 25 July 2019

COMPANIES&MARKETS

BUSINESS DAY

15

Business Event

Lafarge sustains profitability in H1 MICHAEL ANI

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afarge, Nigeria’s second-largest cement maker, remained profitable in the first half (H1) of 2019, thanks to a 40.7 percent decline in the cost of borrowed funds that helped in boosting the firms bottom line despite a decline in revenue.

The cement maker recorded a Profit after Tax (PAT) of N9 billion in the period from a loss of N3.9 billion—the same period last year—buoyed by the firm’s efforts in deleveraging its balance sheet.

Its interest in borrowing fell to N13.4 billion in H1 2019 from N16 billion the previous year while bank overdraft for the firm dropped to N964.7 million from as much as N1.5 billion the same period last year.

Revenue for the firm fell slightly by 1.2 percent from N162.3 billion in 2018 to N160 billion in H1 2019 was due to the slow growth in its Nigeria

operations amidst sustained weakness in its South Africa Operations (Net sales declined 2.1 percent in Q2 2019 despite price increase).

Lafarge implemented a price cut in Q2 following an increase in Q1 2019 and the helped in supporting volume growth in its Nigerian operation as sales volume- up 3.3 percent in Q2 2019 when compared to Q1 2019.

However, sales volume according to the firm was affected by delays in the new cabinet nomination post-February general elections.

The share price of Lafarge gained 9.92 percent to N14.40 at the close of trading, Tuesday, as investors bid higher for the firm following the half-year performance.

“The process of transformation of this company, which we undertook some three years ago, is now moving very swiftly toward solid foundation. Over the last three years, we have succeeded in reduc-

ing the company’s debts by over 1.1 billion dollars through the support of shareholders,” Mobolaji Balogun, Chairman of the firm said.

Like every other firm, Lafarge Africa has had its own fair share of the ups and downs in business, after it recorded a loss for about five consecutive quarters, as a result, a poor performance from the South African arm of the Business.

The firm sale has put on sale its South African subsidiary with consideration being that all of its outstanding inter-group debts amounting to $316.289 million to Caricement B.V, a subsidiary of LafargeHolcim.

In a statement to the Nigerian Stock Exchange, Lafarge noted that its parent company, LafargeHolcim, agreed to purchase the shares for the consideration being a set-off of all the outstanding amounts due by the company to Caricement under the Inter-Group Loan Agreements at the closing date, which is July 31, 2019.

L-R: Selfullah Gaya, GM, Xiaomi Nigeria; Harvey Deng, sale manager, Xiaomi; Karim Kandil, commercial manager, Raya Distribution Nigeria Limited, and Habeeb Somoye, head of marketing, Xiaomi Nigeria, at the launch of Xiaomi Mi 9T pop-up selfie camera in Lagos.

Pic by Olawale Amoo

DEALS

Omega partners Polo Luxury for first wristwatch store in Africa OBINNA EMELIKE

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mega, a top global wristwatch brand is partnering Polo Luxury Group, Nigerian luxury product retailer, in the opening of its first wristwatch store in Africa.

The development is putting Africa on foremost Swiss watchmaker’s distribution channels since inception over 170 years ago in Bienne, Switzerland, as the store will offer discerning customers in Nigeria world-renowned timepieces through Polo retail outlets across the country.

Describing the partnership as a welcome development, John Obayuwana, founder and chief executive of Polo Luxury Group, said that the partnership took many years to actualize because the Omega brand has strict criteria, which intending distributors must meet, and was excited that Polo Luxury Group was able to meet the requirements.

Obayuwana, who spoke during an announcement of the partnership and intro-

duction of the Omega brand to the media recently at the headquarters of Polo Luxury in Victoria Island Lagos, said that the Swiss watchmaker is debuting in Nigeria with some iconic collections including; speedmaster, seamaster, constellation and De Ville, which come with a lot of heritage, a strong tradition of excellence, value for money, among others.

The Polo Luxury Group chief executive noted further that the wristwatch brand, which is famed as the only watch on the moon and the official timekeeper of the Olympics for over 50 years, is sought-after by discerning clients across the world for its durability, precision, store of value, aesthetics, desirability and would be available to different categories of customers.

He noted that the Omega brand is coming with lots of perks for its Nigerian customers including after-sales-service and a five-year warranty on any Omega product purchased at Polo Luxury outlets across Nigeria.

The luxury products retailer

expressed satisfaction with the perks, especially the warranty, which he said has not been offered by other brands in the country.

Also excited that Omega’s dream of expanding into Africa is being realized with the opening of the first store on an African soil, Raynald Aeschimann, president and CEO, Omega, described Polo Luxury as a mutual partner whose years of experience in the luxury retail business is paying off with world-class retail facilities, skilled manpower, right clientele, integrity among others.

“Our enduring commitment at Omega is the satisfaction and confidence of our customers. All of our recent advancements, from pioneering technology to the stateof-the-art factory we opened one year ago, have enabled us to introduce this new 5-year warranty, proving that our standards are continually increasing and that our customers can have even more trust in the Omega watch they wear”, Aeschimann said.

L-R: Kunle Oshodi-Glover (Shoddy), Celebrity Hypeman; Apuabi Oluwamuyiwa, winner of the MTN Pulse House Invasion; Folarin Falana (Falz), Celebrity Artiste; Apuabi Oluwafemi, another winner of the MTN Pulse House Invasion, and Teniola Apata (Teni), Celebrity Artiste, at the MTN Pulse House Invasion 2019.

L-R: Omotola Jalade-Ekeinde, Nollywood actress; Steve Babaeko, founder/CEO, X3M Group, and Kadaria Ahmed, CEO, Daria Media Limited, at an exclusive event to celebrate Steve Babaeko’s recent recognition by Adweek as one of the top 100 creatives in the world in Lagos.

iTel Mobile gives out N3.6 million in consumer promo JUMOKE AKIYODE-LAWANSON

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hree lucky Nigerians have been rewarded by iTel Mobile, with cash prizes in one of the biggest consumer promos in Nigeria, itel’s $10,000 giveaway.

The exciting winning promo was a dream come true for Oyebola Saheed, who won the grand prize of $10,000 and Aigbogun Godwin and Abubakar Akibu,

who received the sum of $2,000 and $1,000 respectively.

The promotion dubbed “ itel’s season of winnings” was an initiative by the brand to give back to customers and celebrate their unwavering loyalty and love for the brand over the years.

Beyond creating the perfect smartphone for everyone that is reliable, trendy, and affordable, itel Mobile has created an exciting niche

where consumers’ needs and satisfaction are the foremost priority.

Speaking on the mega promo, Oke Umurhohwo, itel Mobile’s marketing communications manager, West Africa, said:“itel Mobile is committed to initiatives that positively change the lives of our consumers. This is our way of expressing our sincere gratitude for their unmatched support to our growth. While ensuring we provide the ideal

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smartphone for everyone, we merge that with services and promotions to ensure our customers get a unique and robust experience all around.

We hope that this campaign would transform their lives for the better.”

While shedding more light on the promo, Umurhohwo said the $10,000 giveaway was a platform to enrich the lives of customers and help them get additional value when they purchase

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the brand’s latest power hero smartphones, itel P33 and itel P33 Plus at any itel authorised retail store.

Expressing his heartfelt appreciation behind a delightful smile that he couldn’t hide, Saheed thanked itel Mobile for making him a millionaire overnight.

“This is the biggest miracle in my life. I wasn’t expecting this at all. I was in a public bus when I got the call that I had won in the promo. I started @Businessdayng

shouting thank you Allah, and everyone was wondering what had happened”, Saheed explained. “This money will change my life for the better because I’m always in debt every month. Now, I can live a comfortable life.”

A simple act of kindness can make a huge difference and that is what itel Mobile is doing – creating opportunities for customers to become millionaires and putting a smile on their faces every day.

16

Thursday 25 July 2019

BUSINESS DAY

RESEARCH&INSIGHT

In association with

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

briu@businessday.ng

08098710024

How MSMEs contribute to economic empowerment AMAMCHUKWU OKAFOR

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he Nigerian economy has a large informal economy operating alongside fairly large formal economy.

Micro, Small, and Medium Enterprises (MSMEs) cut across this categorization and play a significant role as the engine for economic transformation and industrialization in the domestic economy.

The National Policy on SMEs defines SMEs based on these dual criteria of number of employees and assets (excluding land and buildings). The table below shows: This categorization demonstrates a practical weakness: under what category would a firm fall if it has N8 million worth of assets but has only 6 employees? The policy stipulates that in such event, the employment criterion carries more weight. In the example, the firm would still be a micro enterprise. Broadly, a business is an SME if it has no more than 200 employees and operates around certain quantum of capital and assets. So, employee size and operational capital matter in the definition of SMEs. The MSMEs National Survey 2017 report published by the Nigerian Bureau of Statistics (NBS) in collaboration with the Small and Medium Enterprise Development Agency of Nigeria (SMEDAN) in 2019 reported a total of 41,543,028 MSMEs in Nigeria—a 12 percent increase over a four-year period (2013: 37,067,416). It shows that 99.8 percent of

Source: NBS, BRIU

that SME growth are strongest in Kwara, Nasarawa and Jigawa states where recorded growth rates from 2013 to 2017 were 526.5 percent, 136.5 percent, and 116 percent respectively. Plateau (-27.8), Rivers (-45.1 percent), and Kano (-70.5 percent) recorded negative growth in the number of SMEs in the period.

Initial capital The SMEDAN/NBS 2017 survey revealed that 63.8 percent of micro enterprises started out with an initial capital less than N50, 000; with only 4.7 percent starting out with over N300, 000. Similarly, 74.9 percent of small and medium enterprises start out with less than N10 million as initial start-up capital. Only 6.3 percent put in an initial capital above N40 million. Personal savings still accounts for over 61.2 percent of

Source: NBS, BRIU

Source: NBS, BRIU

the sources of finance for SMEs. For micro enterprises, personal savings and family financing are the two key sources of financing.

Composition of MSMEs by business types The classification of MSMEs according to the predominant business types aid understanding of the business environment. The survey data shows that wholesale/retail trade account for 42.3 percent of the total micro enterprises in Nigeria. This is followed by

etorship, partnership, and private limited liability company. Others are cooperative businesses, and faith based organisations.

The NBS/SMEDAN survey shows that sole proprietorship still informs the most of business ownerships across MSMEs in Nigeria accounting for 97 percent of total micro enterprises and 65 percent of SMEs. The graphical representation shows that private limited ranks next (higher than partnership) at after sole proprietorship for SMEs while faith based

Access to finance is a top priority area for assistance for both SMEs (67.9%) and MEs (90.5%) alike. For SMEs, the most pressing area for assistance is in power & water supply (83.5%), as well as tax rate reduction (73.1%).

Other challenges that reflect tough operating environment for MSMEs include high energy and utility bills, high/multiple taxes as well as high cost of funds. These challenges and other structural constraints need be addressed to unlock the full potential of MSMEs. 12734BDN

all enterprises are micro enterprises, while 0.17 percent and 0.004 percent are small and medium enterprises respectively. In the period under review, only medium enterprises recorded a decline by 61.6 percent.

The sub-national representation of the data in 2017 shows Lagos (11.5 percent), Oyo (8.4 percent) and Osun (4.1 percent) states have the highest number of total enterprises; while Borno (0.7 percent), Bayelsa (0.4 percent) and Yobo (0.1 percent) have the least. The data also suggests

Agriculture at 20.9 percent; while manufacturing takes 9 percent. Education, real estate, administration and support services are the least with 0.1 percent each.

Different from the micro enterprises, education (27 percent), manufacturing (23 percent) and wholesale/retail trade (18 percent) small enterprises account for 68 percent of total number of small enterprises in Nigeria. While manufacturing, taking 43 percent accounts for nearly half of all medium enterprises, closest to that are wholesale/ retail trade, health services and social works accounting for 13 and 12 percent respectively.

Ownership structure of SMEs SMEs accordingly can be defined according to the ownership structure: sole propri-

enterprises get 6 percent of all SMEs, higher than partnership at 5 percent.

MSME employment by gender The survey shows that as at December 2017, MSMEs generated 59,647,954 jobs. Of that sum 5 percent of the jobs were created by SMEs.The gender distribution of SMEs by employment shows that there are more male than female in both employer and employees categories: for instance, males accounted for 57 percent of jobs created by SMEs, compared to 43 percent for women. The sectors with the highest employment are education, human health and social work, and manufacturing. Education sector is the only sector with gender parity in jobs (53 percent women) compared to manufacturing which employs 3 times more males than females.

Structure and support services The level of integration (especially in terms of registration and tax remittance) into the formal economy by many MSMEs is very low due mainly to low business planning incidence and low formalization. Most enterprises are operating without legal and financial protection. The data shows that 75.6 percent micro enterprises and 65 percent of SMEs have no business plan. Also, 97.8 percent of micro enterprises are not registered. MSMEs are particularly vulnerable to business shocks, and risks as over 90 percent are uninsured.

The weakness in the planning and structure of most MSMEs contribute to high rate of failure as well as reluctance from investors.

Key challenges

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Thursday 25 July 2019

BUSINESS DAY

Investor

17

In association with

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

Market capitalisation

NSE Premium Index

N11.721 trillion

Week open (12– 07–19)

31,924.51 28,566.79

N13.922 trillion

2,333.94

Week close (19– 07–19)

27,919.50

N13.607 trillion

2,278.14

Year Open

Percentage change (WoW) Percentage change (YTD)

2,241.37

The NSE-Main Board

1,456.29 1,161.93 1,137.24

NSE ASeM Index

NSE 30 Index

NSE Banking Index

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

130.95

723.46

NSE Lotus II

NSE Ind. Goods Index

NSE Pension Index

291.84

2,272.45

1,254.54

1,212.79

801.09

1,438.19

426.64

781.58

1,188.26 1,155.48

349.60

119.59

574.38

243.48

1,831.69

1,100.83

1,017.01

334.56

115.08

574.32

229.59

1,791.72

1,043.90

973.21

-5.17

-4.31

-15.67

-19.40

778.18

-2.27

-2.39

-2.12

-0.44

-11.17

3.79

-21.01

-1.97

-2.76 -18.46

-4.30

-3.77 -9.01

-16.14

-0.01

-5.70

-23.30

-24.03

MTNN outperforms other Premium Board listed stocks … FBN Holdings, Seplat, UBA top underperformers Stories by Iheanyi Nwachukwu

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he newly listed shares of MTN Nigeria Communication Plc have by far outperformed other stocks on the league of Premium Board. There are currently eight companies listed on the Premium Board of the Nigerian Stock Exchange (NSE).

Recently, the Nigerian stock market has furthered into the bearish region as stock investors’ increasing negative sentiments cause equities value to decrease.

The re cords year-to-date (ytd) negative return of about -11.52percent as at July 22 results from value hemorrhage seen around largely capitalized stocks like those listed on the Premium Board.

The Premium Board is the listing segment for the elite group of issuers that meet the Exchange’s most stringent corporate governance and li​sting standards.

The Board is a platform for showcasing companies who are industry leaders in their sectors.

P re m i u m B o a rd f e a t u re s companies that adhere to international best practices on corporate governance and meet the Exchange’s highest standards of capitalisation and liquidity.

INVESTOR’s check shows that while the stocks of MTNN at N126

L – R: Bola Adeeko, divisional head, Shared Services, The Nigerian Stock Exchange (NSE); Stephanie Platz, managing director, MacArthur Foundation; Oscar N. Onyema, OON, chief executive officer, NSE; Julie Katzman, Board Member, MacArthur Foundation; Funmi Olopade, board member, MacArthur Foundation; Amina Salihu, senior program officer, MacArthur Foundation; Kole Shettima, director, Africa Office, MacArthur Foundation; Yvonne Darkwa Poku, senior Program Officer, MacArthur Foundation and Erin Sines, co-director, MacArthur Foundation during MacArthur Foundation courtesy visit to The Exchange.

as at July 22 shows it advanced most by 40percent year-to-date (ytd), its counterparts like FBN Holdings Plc and Seplat Petroleum Development Company Plc have respectively recorded major declines.

At N 5.65, the share price of FBN Holdings Plc has decreased this year by 28.9percent. Also, at N480 per share, Seplat Petroleum Development Company Plc, another Premium Board listed stock has lost 25percent of its year open value.

Premium Board listing is meant to give a company access to a global

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pool of investors who are focused on companies managed in conformity to the highest standards in their target markets.

While Lafarge Africa Plc at N13.10 per share has gained 5.2percent this year to outperform the NSE All Share Index (ASI), the share price of Dangote Cement Plc at N170 as at July 22 represents year-to-date decline of about 10.4percent.

Access Bank Plc has lost 4.4percent of its value this year to N6.50; while Zenith Bank Plc at N18.40 per share as at July 22 represents a year-to-date

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decline of 20.2percent.

United Bank for Africa Plc has also lost 22.7percent of its value at the beginning of this year. The share price stood at N 5.95 as at the review date.

Looking ahead, market watchers expect most of the tepid performances shown by these Premium Boardlisted stocks to continue particularly in the absence of catalyst that could spur positive sentiment.

However, the possibility of intermittent gains owing to investors positioning for interim dividend payment is not rule out.

@Businessdayng

-4.33 -19.80

Investors trade N1.09trn worth of equities in H1’19

I

nvestors at the Nigerian Stock Exchange (NSE) traded stocks valued at about N1.087trillion in the first-half (H1) to June 30, 2019.

The total value of equities traded in H1’2019 is far below N1.597trillion recorded in the corresponding period of 2018, implying a year-on-year (yoy) decrease of circa 47percent or N510billion.

This is even as domestic investors accounted for N614.73billion or 54.16percent of the total value of stocks exchanged at the Bourse in the review period. In first-half of 2018, domestic investors exchanged stocks valued at N797.47billion.

In H1’19, retail domestic i nv e s t o r s e x c h a n g e d s t o c k s valued at N329.69billion while institutional investors accounted for N285.04billion, summary of equities transactions as at the review period shows.

Their foreign counterparts accounted for just 45.84percent or N472.78billion as against N 799.70billion in H1’18.

In 6 months to June 2019, foreign inflow stood at N 214.97billion while foreign outflow worth N257.81billion was recorded.

Highlights of the performance of the stock market over the last twelve (12) year period show domestic transactions decreased by 66.68percent, from N3.556trillion in 2007 to N1.185trillion in 2018 whilst foreign transactions increased by 97.88percent from N616million to Continues on Page 18

18

Thursday 25 July 2019

BUSINESS DAY

Investor Helping you to build wealth & make wise decisions

United Capital Investment Views

Investor’s Square

Bears hold sway on NSE

T

he Nigerian equity market continued its downward streak, as the NSEASI shed 2.3percent week-onweek (w/w), an unimproved performance from the previous week. The broad Index closed last week at 27,919.5 points and year-to-date (YTD) return sank deeper to -11.2percent.

Similarly, market capitalisation shed N315billion w/w, to end at N12.6trillion.

Performance across major sub-indices was bearish, as all sectors recorded negative performances. The Oil & Gas (-5.7percent) sector led the laggards table, on the back of declines in sector heavyweights such as SEPLAT (-9.4percent) and TOTAL (-7.2percent). The Industrial Goods (-5.2percent), B a n k i n g ( - 4 . 3 p e rc e n t ) , Insurance (-3.8percent) and Consumer Goods (-1bp) sector indices all trailed, dragged by sell offs in CCNN (-17.2), UBA (-6.8percent), MANSARD (-8.3percent) and INTBREW (-10percent).

Over the week, United Capital Plc releas e d its

financial results for secondquarter (Q2) 2019, reporting a quarterly revenue g row t h o f 2 7 p e rc e nt t o N1.8billion and a profit after tax (PAT) growth of 58percent to N1billion. Also, Flour Mills of Nigeria Plc released its FY-18 results, with both Revenue and PAT declining by 2.8percent and 70.6percent to N527.4billion and N4billion respectively.

Inv e s t o r s’ s e nt i m e nt remained weak as indicated by market breadth of 0.3x as 52 stocks declined while 14 stocks advanced. Looking ahead, we expect the tepid performance to continue in the market in the absence of catalyst that could spur positive sentiment.

However, we do not rule the possibility of intermittent gain owing to investors positioning for interim dividend-paying stocks.

Money Market: CBN send a mix signal at the primary market The money market stayed liquid in the prior week as the size of naira inflow outweighed overall outflows. Notably, major liquidity inflows were in the form of bond coupon payments and OMO maturity while outflows were via OMO and weekly FX funding sales.

Additionally, inflows from Nigerian Treasury Bills (NTB) maturity and retail FX refunds were later mopped up via NTB and retail FX funding sales. In all, average interbank funding rates (OBB & O/N rates) started the week on a high of 8.54percent but trended lower to end at 4.2percent.

The apex bank sent differing market signals at the OMO and NTB auction conducted during the week. At the NTB auction, stop rates declined across tenors as market continue to adjust to the realities of the apex bank easing stance.

On the other hand, the apex bank retained OMO stop rates at previous auction levels and sold the exact amount

on offer despite significant oversubscription across tenors.

Elsewhere, the impact of the elevated level of liquidity outweighed the resumption of OMO sales by the CBN as average yields at the secondary NTB market declined 62bps w/w to 10.5percent. Notably, short-medium dated bills traded largely in the single digit region. This week, we expect market participants to look to the outcome of the MPC meeting for guidance. Thus, we anticipate some cautious trading at the secondary market. However, elevated liquidity in absence of a further mop up by the CBN should continue to buoy buy-side demands.

Bond Market: Investors to look to fresh issuances The Debt Management Office (DMO) published the Federal government of Nigeria

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(FGN) bond issuance calendar for Q3-19, during the prior week. According to the report, the FG plans to raise an average of N420.0bn, split between 5-year, 10-year and 30-year notes. Elsewhere, the liquidity inflows from the 2021 and 2034 bond coupon payments created some demand impetus at the domestic secondary bond market as some investors look to re-invest those funds.

Consequently, average bond yields declined across the curve, down by 25bps w/w to close the week at 13.4percent.

Nigerian sovereign Eurobond market also witnessed some buying interest in the previous week, as a more dovish tone from the developed market central banks buoyed sentiments toward Emerging and Frontier market assets.

Consequently, yields on FGN dollar bonds moderated across the curve and average yield declined by 8bps w/w to 6.3percent. Similarly, interest in Corporate Eurobonds turned positive as average yield (exFirst Bank Ltd. soon to be called dollar note) for the segment inched lower by 6bps w/w to 6.3percent. Meanwhile, the yield on FBNL 2021 dollar note closed negative at as the market price revert to par.

During the latter part of the review week, South African’s Monetary Policy Committee (MPC) unanimously decided to cut its key policy rates by 25bps to 6.5percent. This week, we expect activities in the secondary bond market to remain muted/bearish as players look to new issuances at the July 24th bond auction, wherein the DMO plans to raise N145billion via re-opened 5-year (N40billion), 10-year (N50billion) and (N55billion) notes. In the Eurobond space, the sustained dovish chorus by global central banks is expected to continue to spur interest in EM/FM assets (Nigeria inclusive).Additionally, the $450million worth of maturing FBNL’s Eurobond should spur some buying interest in the corporate Eurobond market.

FX: Mixed w/w outcomes The rate of exchanging the naira for the US dollar produced a mixed outcome w/w, across the three FX windows we track. At the Official window, rates appreciated 2bps to N306.95/$1 while rate at the I&E window dipped 0.2% w/w to N361.5/$1. The parallel market rate remained largely flat at N359.0/$1.

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

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

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Investors trade N1.09trn worth ...

Continued from Page 17 N1.219trillion over the same period.

Total foreign transactions accounted for about 51percent of the total transactions carried out in 2018, whilst domestic transactions accounted for about 49percent of the total transactions in the same period.

Meanwhile, as at 30 June 2019, total transactions at the nation’s bourse increased by 34.42percent month-onmonth (MoM), from N221.13

billion (about $713.7 million) in May 2019 to N297.25 billion (about $970.1million) in June 2019.

The performance of the review month of June 2019 when compared to the performance in the same period (June 2018) of the prior year revealed that total transactions also increased by 58.29percent.

In June 2019, the total value of transactions executed by domestic investors significantly outperformed transactions

executed by foreign investors by 34percent.

Further analysis of the total transactions executed b e t w e e n Ju n e a n d May 2019 revealed that total domestic transactions increased by 39.36percent, from N143.87billion in May to N200.51 billion in June 2019. In contrast, total foreign transactions also increased by 25.22percent from N77.25 billion (about $252.1 million) to N96.74 billion (about $315.7million) between May and June 2019.

Non‑centrally cleared derivatives: Final implementation phase takes place Sept 1, 2021 …as Basel Committee, IOSCO agree to one year extension

T

he Basel Committee on Banking Super vision and the International Organisation of Securities Commissions (IOSCO) acknowledge the progress that has been made to implement the framework for margin requirements for noncentrally cleared derivatives.

In the final phase of implementation, initial margin requirements are scheduled to apply to a large number of entities for the first time. In March 2019, the Basel Committee and IOSCO published a statement noting that the framework does not specify documentation, custodial or operational requirements if a covered entity’s bilateral initial margin amount does not exceed the framework’s €50 million initial margin threshold.

F u r t h e r, t h e B a s e l Committee and IOSCO have agreed to extend by one year the final implementation of the margin requirements.

With this extension, the final implementation phase will take place on 1 September 2021, at which point covered entities with an aggregate average notional amount (AANA) of non-centrally cleared derivatives greater than €8 billion will be subject to the requirements. To facilitate this extension, the Basel Committee and IOSCO also will introduce an additional implementation phase whereby as of 1 September

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2020 covered entities with an AANA of non-centrally cleared derivatives greater than €50 billion will be subject to the requirements.

The Basel Committee and IOSCO have agreed to this extended timeline in the interest of supporting the smooth and orderly implementation of the margin requirements which is consistent and harmonised across their member jurisdictions and helps avoid market fragmentation that could otherwise ensue. The Basel Committee and IOSCO expect that covered entities will act diligently to comply with the requirements by this revised timeline and @Businessdayng

strongly encourage market participants to make all relevant arrangements on a timely basis.

The Basel Committee and IOSCO have published on their websites a revised version of the margin requirements to reflect this limited revision to extend the implementation timeline by one year. The revised publication features no other substantive changes to the margin requirements framework.

C o n s i s t e nt w i t h t h e i r mandate, the Basel Committee and IOSCO will continue to monitor progress in implementation to ensure consistent implementation across products, jurisdictions and market participants.

Thursday 25 July 2019

BUSINESS DAY

19

Investor Helping you to build wealth & make wise decisions

Analysis

Transcorp: Aggressive growth agenda positive signal to shareholders Iheanyi Nwachukwu

O

n Tuesday July 23, Transnational Corporation of Nigeria Plc (Transcorp) held its half year (H1) analysts parley for journalists, financial analysts and investors.

The interactive session followed a presentation by Valentine Ozigbo, president/CEO, Transnational Corporation of Nigeria Plc. Transnational Corporation of Nigeria Plc is a publicly quoted conglomerate with a diversified shareholder base of about 300,000.

Its portfolio comprises strategic investments in the power, hospitality, agribusiness and oil and gas sectors. Our notable businesses include Transcorp Hilton Abuja, Transcorp Hotels Calabar, Transcorp Power and Transcorp Energy.

In attendance at the parley are chief executive officers (CEOs) of Transcorp subsidiaries and other senior management staff.

The aggressive growth plan shows in the group’s phase-three journey (2019-2025). In its Power Sector, Transcorp’s focus is to increase power generation through acquisition of additional power plants (Afam plant); look out for opportunistic investments in renewable energy and off-grid solutions. In the its hospitality business it commits to sweat existing assets, expand into new businesses and locations; while in the Oil and Gas sector, Transcorp’s target is to commence production of oil and gas in OPL 281 and acquisition of new oil and gas assets.

Nigeria is poised to maintain its position as the largest economy in Africa. Inflation rate has been decreasing; 11.22percent as at the end of June 2019. Globally, the power sector is facing significant challenges. Revenues have been under pressure from the rise in renewables; in 2018, renewable energy accounted for almost one-third of net new power capacity around the world.

While cost is increasing due to: replacing, maintaining and upgrading energy and water infrastructure; rising environmental compliance costs; investment in innovative products and services; as well as rising cyber security and data privacy cost, revenue is declining as a result of change in consumption pattern and industry dynamics due to; maturing of renewable energy technologies, proliferation of distributed energy, falling cost of battery storage, and more empowered consumer behaviour are shifting how we produce, use and value trade electricity.

The Nigerian power sector needs significant improvement. For instance, 91 million Nigerians do not have access to electric power. This is a far cry from other African oil producing States’ scores. Egypt has a score of 5 while Algeria has a score of 4.2 in terms of access to electricity. Its sub-Saharan Africa counterpart, South Africa was ranked 97th; India, its peer in the Emerging Market category, was ranked 80th. Nigeria lags peers’

Valentine Ozigbo, President/CEO, Transcorp Plc

as South Africa has 4.14kWh per capita, Indonesia has 0.82kWh per capita and Kenya has 0.17kWh per capita.

The company presented its financial results for the half year ended June 30, 2019 showcasing its aggressive growth agenda that will at the long run improve returns to shareholders. The company projects improved performance outlook for the conglomerate in the remaining quarters of the year 2019. The positive projection by Transcorp comes despite the inclement operating environment.

Highlights of the group’s results showed gross revenue of N37.76billion and Profit Before Tax (PBT) of N5.05billion for the period under review, with a drop-in year-on-year performance.

This drop was mainly attributable to gas and transmission challenges faced by the power business, which are being addressed

by Transcorp’s Management. The hospitality business on the other hand recorded significant top line growth, following the recent renovation and improvements in service delivery.

Revenue from the power business remains the largest contributor (75percent) to the group’s revenue. Although income from the power business fell during the period under review due to gas and transmission issues, a number of actions are being taken to address these issues. The hospitality business recorded an increase of 16percent yearon-year in revenue.

Sunny Nwosu, National Coordinator Emeritus, Independent Shareholders As-

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sociation of Nigeria (ISAN) commended Transnational Corporation of Nigeria Plc and urged the management to “Ensure that your finance cost does not take the shine off your good performance.”

Transcorp expects the situation with the gas supply to improve going forward based on the targeted activation of the reviewed Gas Supply and Aggregation Agreement and optimisation of the opportunities therein.

Also, they are exploring additional affordable gas supply sources. Transcorp is currently exploring opportunities created by the Eligible Customer regime initiated by the Federal Government. This would allow the group to sell power directly to certain end users who meet the criteria set out in the governing regulation. By so doing, Transcorp can put to good use, its stranded capacities. With regards to its outstanding receivables from Nigeria Bulk Electricity Trading Plc (NBET), Transcorp is currently pursuing measures to fast track payment. Also, there is an ongoing discussion on modalities for the repayment of legacy debt.

Chris Ezeafulukwe, Executive Director, Business Development and Legal, Transnational Corporation of Nigeria Plc said, by the time Transcorp explores all the opportunities in the power sector (mini and off grids) and also harnessing the opportunities in the eligible customer regime, the company will be able to bridge the gap in the power sector.

Analysts present at the event expressed their appreciation of the detailed presentation and clarification provided by the Transcorp team. They identified with the

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challenges faced by Transcorp during the period under review and reaffirmed their faith in the Board and Management of Transcorp to successfully execute their laid-out action plans to ensure a turnaround performance in Q3 2019.

Transcorp Consortium, with its bid price of N105.3billion ($293m) recently emerged the Preferred Bidder for Afam Genco, comprising Afam Power Plc and Afam Three Fast Power Limited, after a highly competitive bid conducted by the Bureau of Public Enterprises.

Commenting on the results, Ozigbo, stated that “Our half year results were affected by severe gas shortages as well as transmission and other technical challenges in our power business, especially during the first quarter of the year when supply dropped from an all year peak of 150 mmscf/d to an average of 89 mmscf/d. We are happy with growth in our hospitality business as it affirms the decision we made to invest $100million in upgrading the Transcorp Hilton Abuja.”

Ozigbo further noted that “with the support of our Board, management is implementing a number of action plans aimed at addressing the gas supply challenges in a sustainable manner. These include the activation of a recently reviewed Gas Supply and Aggregation Agreement as well as the optimization of the opportunities embedded in it, and the exploration of additional affordable gas supply sources.

He said, “Actualization of these as well as improvement in transmission and market payment for electricity generation will drive recovery in the second half of 2019. This is in addition to even more significant contributions from our hotel business, which is expected to sustain the increased occupancy rates seen in the first half of the year.”

Reiterating Transcorp’s bullish performance in recent years, he further stated that “Through a mix of operational efficiency and strategic business development, we are confident of a more positive Q3 performance and we remain committed to our value-creating purpose of improving lives and transforming Nigeria.”

“Having attained this laudable milestone, we expect a significant growth in the company’s performance in the future upon full takeover of the new plant. This brings us closer to achieving our aspiration of providing power to one out of every four Nigerians,” Ozigbo added.

Owen Omogiafo, Managing Director, Transcorp Hotels said, “The Outlook for hospitality business is very positive looking at the rising middle class, the millennia, technology and digital market. They will help us drive our business”.

“For us to have consistently maintained over 50 percent occupancy rate in our business in really commendable. We will continue to drive our customer service efficiently with new products and competitive prices”, she said.

@Businessdayng

20

Thursday 25 July 2019

BUSINESS DAY

Thursday 25 July 2019

BUSINESS DAY

21

EBIAHO EMAFO

CEOINTERVIEW

MD/CEO, Eroton Exploration and Production Company Ltd

Interview with Private Sector Leaders

‘There is a huge opportunity in the gas space that has not even been exploited’

Ebiaho Emafo is the Managing Director/Chief Executive Officer of Eroton Exploration and Production Company Limited. In this interview with FRANK UZUEGBUNAM on the sidelines of 2019 Nigeria Oil & Gas Conference in Abuja, Emafo talks about the challenges facing indigenous operators, his desire to see another bid round soon, what he envisages in the future for Eroton, amongst other issues. Excerpts: Let’s begin with your organisation and operational profile. roton Exploration & Production is the operator of OML18, which we bought during the divestment of Shell Petroleum & Development Company (SPDC) from some of its onshore assets’ portfolio.

Our head office is in Lagos, our district office is in Port Harcourt and we have field locations in Rivers State where we operate. We took over the asset from the former operator in 2015 when we were producing about 10,000 barrels of crude a day based on the previous operator’s production output. Since then we have been able to grow production from 10,000 to 70,000 barrels a day and 73,000 barrels at peak production. We have been able to grow production in the gas space to circa 100mscf per day which we then deliver to our primary customer called Notore Chemical Industries. Notore is a fertilizer company based in Onne, Rivers State.

Do you have any refining ambition?

Not in the immediate time. But there exists a possibility of us looking at the opportunities within the refinery space but not in the short to medium term.

What is your take of the contribution of indigenous players in the exploration and production sector?

Indigenous producers have contributed significantly towards exploration and production in Nigeria. We used to contribute about 10 percent towards Nigeria’s total oil production; today that contribution has moved to about 21/22 percent. The aspiration at a time by the Nigerian National Petroleum Corporation (NNPC) was for indigenous producers to contribute 30 percent of the total daily production. We are not there yet, but we are consistently growing our production and I am sure that within the near future, we can attain that target, which has been more or less requested for by NNPC. It is also important to note that most of the operations that we the indigenous players have were from the divested assets of international oil companies (IOCs) that are on land and swampy locations where they had security challenges which we inherited.

However, we have been able to work closely with the host communities regarding the issues of security, though we still face significant security challenges and breaches on the pipelines which traverse our acreages on the route to the export terminal.

These breaches lead to about 20-30% loss of our production and other producers on the line. Despite these challenges, we have ramped up production significantly and our aspiration is to continue to grow with a view of surpassing the 30 percent contribution aspirations of the Federal Government through the NNPC. Which of the challenges if eliminated can help the indigenous players increase their potential?

Security is a great challenge for all the

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indigenous operators. Anybody within the swamp or land region is susceptible to security challenges. You have vandalisation of flow lines and the export line because it is easily accessible. At a time, we experienced losses in excess of 30 percent, but now they range between 20 and 30 percent of our daily production. In value terms, we were losing about 20,000 barrels of crude a day. Some operators produce as much as 20,000 barrels per day and that is a viable business for them. If you are losing 20,000 barrels of crude per day, it severely impacts your cash flow and the return on your investment. So, if the Government is able to fix the security along the export lines, we will be able to realize our full production potential and that will bring significant returns to the business and the nation.

In the area of gas, the government needs to create infrastructure to transport the gas that we produce to the areas of utilization so we can have bankable opportunities where we are able to sell our gas and make returns on our gas investment. At the moment, we are restricted in terms of ability to sell our gas as a result of limited infrastructure, and that is across board.

Again, security poses another challenge: there are frequent shutdowns of the export line which occur because of the oil spills that come as a result of the intrusions on the line by vandals. Sometimes, when the line is down, we are able to produce neither oil nor associated gas. This year we have lost about 24/25 days of production because of sabotage on the export line. In addition, we have the attendant environmental challenges that come as a result of the pollution caused by the acts of sabotage and vandalism on the pipelines.

Statistics show that most of the leakages and spills are as a result of vandalism and or illegal bunkering. This could naturally invoke a sense of aggrievement amongst the host communities who are unfortunately saddled with the negative effects of the pollution caused by vandals which could create a difficult environment for us as business to operate in. We have however worked closely with our communities to ensure that issues like these are contained as we continue to enjoy a good working relationship with them Have you considered alternative evacuation for the crude oil?

Yes, we are working on the possibility of an alternative crude evacuation line due to the current challenges we face, which we are hopeful would significantly reduce crude theft and improve production uptime from our asset.

You are aware that the government is looking at selling down its joint venture assets?

While government participation is good sometimes for business, working outside the confines of normal Government bureaucracy could also be beneficial, as there would be the opportunity to progress at a www.businessday.ng

faster pace with a higher level of efficiency.

We expect that with the proposed divestment of Government equity, there could be a resurgence in investment and hopefully maximization of returns on investment for all stakeholders. The NLNG model serves to buttress this expectation which to date remains a reference point for balanced public-private participation in business.

What is the best way to approach this?

I believe existing equity holders should be given right of first refusal. This naturally makes sense as there always exists the risk of stakeholder misalignments and or

conflicts if too many equity holders exist on one particular asset. In the event that the operator and or other equity holders (excluding government) are not interested in acquiring additional equity, it should then be opened to the public by way of a competitive bidding exercise. As mentioned earlier, the NLNG model is always a good reference point. Government should retain a minority stake in its oil and gas assets and rather focus more on regulation and fiscal compliance. I am of the firm belief that if this was executed, Government would realise more revenue and also debottleneck the investment pipeline thereby spurring private investors to dedicate more funds towards the development

Profile

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biaho Emafo is a graduate of the University of Benin. He also holds an MBA from Cardiff Business School, University of Wales College of Cardiff, and a Master’s Degree in Logistics & Supply Chain Management from the University of Cranfield School of Management, UK. He is a Chartered Member of the Chartered Institute of Purchasing and Supply, United Kingdom.

Prior to joining Eroton E & P, Emafo worked for the United Nations, Procurement Division, New York, on assignment to Entebbe, Uganda; responsible for developing

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and production of more hydrocarbons.

This approach refers primarily to the oil element of the business. In the gas space, I believe government would still need to play a critical role by way of providing the necessary infrastructure to evacuate and deliver gas from the producers to the respective consumers across the nation.

Are you also looking beyond oil and gas, with emphasis on renewables?

For now, we are primarily focused on the oil and gas space. We need to increase our current oil production. We recently commenced a drilling campaign to grow our production and also develop our remaining reserves. To date, we have drilled two wells and are preparing to spud the

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as a startup, the Regional Procurement Office and servicing on UN Field Missions in Somalia, Sudan, South Sudan, Democratic Republic of Congo, Burundi, Central African Republic, Cote d’Ivoire, UNISFA, The United Nations Interim Force for Abyei & The United Nations Mission for Ebola Emergency Response (UNMEER).

Prior to that, he held several Directorlevel positions, which included: Supply Chain Management Director, Airtel Ghana Limited, where he formed and developed the supply chain management function of the new Zain

acquisition in Ghana (Greenfield Operation).

He was also the Regional Procurement Director for Zain Communications Limited (East & South East Africa), responsible for Uganda, Malawi, Tanzania, Kenya, and Zambia.

Other Positions held include Head of Purchasing Lafarge Nigeria Plc; Head, Procurement & Services Oando Plc; Head of Warehouse (Materials) and Head of Purchasing Total Upstream Nigeria Limited; Project Officer, United Nations Peace Forces; Former Yugoslavia, Administrative Office, Crown Prosecution Services, UK.

third this month. We also need to grow our gas side of the business. We are working very closely with a view to expanding our gas Customer base and also pursue expansion of our current supply obligation, working closely with NNPC on the seven critical gas project. We are looking at growing our gas production from 100mmscf a day to 270mmscf in the short to medium term and then continue to increase gas production once bankable opportunities exist.

How are you dealing with the challenge of infrastructure deficiency in the gas space?

We have been working closely with the government in identifying the gaps that are hindering our gas development and commercialization. There exists the possibility of self-funding by the business if there is a viable business opportunity, but it entails working very closely with the government.

We see a lot of promise and opportunities in the future as we are currently involved in the 7 Critical Gas Development Project (7CGDP), spearheaded by the NNPC which is tasked with delivering 3 bcf per day to the domestic market by 2023.

Are you worried that the government has not awarded oil bloc or conducted a bid round for some time now?

I think it should be priority for Government. It is a huge opportunity that government could leverage on. The opportunity to award blocks and marginal fields by an open competitive process is something I think the government should embark upon as a matter of urgency as these assets have remained fallow for a long time, which has deprived the nation of much needed revenue and employment opportunities. It would appear that the opportunity for a bidding round on marginal fields has been in the works for a sometime, but I am not certain progress has been made in this direction. I am of the opinion that if done openly and transparently, which would be the route to go, it would be received with great enthusiasm and participation by industry players.

We witnessed the transparency in the award of GSM licenses back in the days.

No one has complained about the process regarding the award of GSM license. So if in the oil and gas space as well we work towards opening up competition and getting realistic competitive bids for these assets, it would generate revenue for the government, which they can use to further infrastructure development and also bring additional crude into production. The government also stands to gain from the uplift in taxes and royalties.

Beyond awarding oil bloc, what policy changes do you want to see happen?

First and foremost, there needs to be a landing and passage of the Petroleum Industry Bill (PIB). Uncertainty can be a disincentive for investors as it limits investors from predicting and projecting their returns. The passage of the bill would ultiwww.businessday.ng

mately improve the ease of doing business in the Oil & gas space in Nigeria.

In addition, I believe key social indices need to be addressed. The lack of adequate infrastructure and social amenities in some of our host communities and environs is one of the primary causes of the state of insecurity in the region. Unemployment also remains a thing of concern.

Due to the scarcity of viable employment opportunities, people are driven to take their perceived share of the “National Cake” by means that are illegal. So the social dimension needs be tackled while providing security for those operators within the zone so they do not lose the crude oil or the investment they have made.

Are you still burdened by the issues of multiple taxation, fines and levies in the sector?

The whole industry faces this challenge.

Inconsistency and duplication of relevant policies and levies could be a problem.

Typically, any business needs to be able to plan within a known regulatory and compliance framework which would then form the basis for your company’s cost of operations and attendant revenue profile.

Planning becomes difficult if the business is burdened with multiple levies from different agencies and uncertainty in policies.

Government should work towards streamlining the process and roll out clear policies and harmonize roles and responsibilities of government agencies so as to create an enabling environment for business to grow.

We are in the age of Artificial intelligence and technology. How much of this have you introduced into your business?

We are not doing as much as we should in the technology space, but I will tell you

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that as we go along, we will continue to invest in technology. We have plans to deploy smart technologies to aid and improve on our operational efficiencies.

Plans exist to deploy SCADA monitors on our infrastructure, downhole gauges to adequately monitor well performance and a host of other novel technologies that promise to generate increases in production, asset reliability and exploration successes. The goal is to eventually operate “Smart Fields” which is a term used to define a scenario where all our oil and gas facilities and assets are operated remotely with real-time data feeds from the fields to our control rooms. Big data is also an area where we see a lot of potential and have put in place plans to leverage on this in order to improve performance.

What are the new frontiers and targets for Eroton?

We will continue to progress our maturation and acquisition activities by identifying new prospects and leads within and around our current acreage. Like I mentioned earlier, we have since commenced our infill drilling campaign and are actively maturing exploration prospects. We intend to expand our gas customer base as we continue to supply and meet existing customers demand. The aforementioned activities are areas where we at Eroton are looking to create value and grow the business in order to meet our corporate target of being the number one indigenous producer in the country.

We also intend to improve and develop the communities where we operate, especially in terms of health, education and empowerment. We will work closely with the Federal and State Governments to see how best we can positively impact the social infrastructure within our area of operation.

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22

Thursday 25 July 2019

BUSINESS DAY

ENERGYREPORT Oil & Gas

Power

Renewables

Environment

NNPC loses $1billion annually to inefficiency, others- says BPE Stories by Olusola Bello

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he Nigerian National Petroleum Corporation loses between $800 million and $1 billion annually to inefficiency, mismanagement and unnecessary interference from political authorities.

This was the view of the Alex Okoh, director general of Bureau of Public Enterprises (BPE) who said it is better for the corporation to be reorganised or reformed now and allow it to compete with its peers across the globe The BPE boss who spoke on ’BPE’S Role-Post PIGB Investors Benefits’ at the centre of Petroleum Information (CPI) Roundtable said that NNPC faces a range of issues that make reforms an inevitability if only is to ensure the stability and efficiency of the Nigerian Petroleum industry.

He listed a litany of other things that have bedeviled the corporation, stating that

L-R: Mele Kolo Kyari, group managing director of the Nigerian National Petroleum Corporation; Odiri Umusu, vice president, Business Development CWC group and Taofik Adegbite, chief executive officer of Marine Platforms at the recently held Nigerian Oil & Gas Conference and Exhibition in Abuja.

they must be dealt with before there could be a reversal of the current losses the corporation experience on an annual basis.

He went further to state that there is a weak governance structure and lack of transparency, accountability, and commercial oversight and credible management structures in place.

He said also the reluctance to relinquish politi-

cal influence or surrender discretionary control over the use of National Oil Company’s (NOC) funds by State, and the deliberate attempt at avoiding clarity concerning the NOC’s organizational positioning in the government structure are major obstacles to having a profitable and a result-oriented state oil company.

“Politically constituted boards of directors, without

IOCs see opportunity in utility fragmentation in Nigeria, Europe

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nternational oil companies (IOCs) returning to the utility business has been a clear trend over several years, with the European headquartered majors at the forefront.

Shell’s installed generating capacity in North America is now above 10GW, of which one-third is from renewable sources, and it has also invested in Dutch offshore wind.

In the UK, its acquisition of supplier First Utility sees it supplying 100pc renewable power, as well as gas and energy services, to domestic consumers, while, through MP2 Energy, it has also entered the US supply market.

Shell has also bought into the US and Asian solar, while it has made three investments in electric vehicle (EV) charging firms and In Nigeria, Shell has contributed in small measure Olusola Bello, Team lead,

towards ensuring that the country enjoys a steady power supply with the establishment of the 650 megawatts Afam VI power plant which contributes about 13 percent o the nation’s grid-connected electricity.

Aside from this, it has also been very active in the areas of renewable by providing capitals for startups to install solar powers with the aim of boosting the social-economic growth of the indigenes of Niger Delta through the introduction of All On partnerships for energy access.

All On invest in off-grid energy solutions spanning Solar, wind, hydro, biomass and gas technologies deployed by both foreign and local access to energy companies that compliment available grid power across the country and help bridge the significant

Graphics: Joel Samson.

energy gap.

Also in Nigeria, Eni, the Italian oil giant is very much into power generations as it has almost upgraded the 450 megawatts Okpai Power plant to 1000megawatts in the next few weeks.

Total oil company has also launched solar-powered service station. Built-in line with its commitment to better energy ambition, it is the first of its kind in West Africa.

Meanwhile institutional investors are increasingly being required to factor climate change into their decision-making UK pension schemes have for a couple of decades spoken about taking environmental, social and governance (ESG) factors into consideration in their investment decisions—and then largely proceeded to invest regardless.

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requisite professionalism or Independence, obstructs the formation of adequately capitalized or independent enterprises, or business units within enterprises with incentives to act commercially”.

The conflict of roles by NNPC in which he formulates, implements and regulates the sector and at the same time being an active player in the sector simul-

taneously also does not allow the corporation to be focused, he said.

Meanwhile the NNPC claimed it has a trading surplus of N6.33 billon for the month of May 2019, a figure which is 13 percent higher than the N5.60 billion surplus posted in the preceding month of April 2019.

Details of the report contained in the May 2019 edition of the NNPC Monthly Financial and Operations Report (MFOR) attributed the modest rise to the increase in gas and power output which contrasts with the report made figure for the preceding month.

Ndu Ughamadu, group general manager, Group Public Affairs Division of the Corporation attributed the result to the surplus recorded by the corporation’s downstream entities like NNPC Retail, PPMC, NPSC and Duke Oil. The report further indicated that within the period, the NNPC recorded a total of $580.32 million in export sale of crude oil and gas which is 23.39 percent higher

than the previous month’s figure. Out of this number, crude oil export sales contributed $458.59 million which translates to 79.02 percent of the entire dollar transactions compared with $342.11 million contributed in the previous month.

The report also showed that between May 2018 and May 2019, crude oil and gas worth $5.97 billion was exported.

In the downstream, to ensure uninterrupted supply and effective distribution of petrol across the country, a total of 2.06bn litres of petrol translating to 66.49mn liters/ day were supplied for the month of May 2019.

It was noted that beyond supply, the corporation continued to diligently monitor the daily stock of petrol to achieve smooth distribution of petroleum products and zero fuel queue across the nation.

Within the period, a total of 60 pipeline points were vandalized which represents a remarkable 52 percent decrease from the 125 points vandalized in April 2019.

Virtus reaches financial closure on loan facility from sterling bank to power markets

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terling Bank has extended a five (5) year facility worth N446m to Virtus for the deployment of distributed energy solutions across selected economic clusters in Nigeria.

This would help the Rural Electrification Agency in implementing it Energizing Economies Initiative (EEI) which supports the rapid deployment of off-grid electricity solutions to provide clean, safe, affordable and reliable electricity to economic clusters.

EEI which is fully funded by the private sector developers aim to provide electricity access to over 80,000 shops across 16 economic clusters, empower over 340,000 micro, small and medium-size enterprises, create over 2,500 jobs while serving over 18 million Nigerians.

The REA worked in collaboration with the USAID sponsored programme, Power Africa. Power Africa provides technical advisory support

the initiative, which the REA claims that the programme is already transforming businesses in Sabon Gari market, Ariara market, Sura shopping complex and other economic clusters with sustainable, clean and affordable power supply by increasing economic activities, spurring business growth, fostering job creation and enhancing the business experience.

Stephen Haykin, USAID/ Nigeria Mission Director, in his reaction said: “Technical advisory is a key pillar of assistance Power Africa provides to Nigeria’s power sector. We are focused on ensuring initiatives like the Energizing Economies are designed and implemented with regulatory, legal, financial, transactional and project management support.”

Abubakar Suleiman, the managing director, Sterling Bank said: “At Sterling we believe that the answer to power generation is a multiplicity of

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

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options and we want to be at the forefront of the commercialization of renewable energy. Our involvement in the Virtus transaction which provides N446 million in development financing demonstrates our commitment to improving the capacity of off-grid private sector developers for power generation. We hope that this paves the way for more financing to the sector.”

Virtus, a highly experienced decentralized energy consortium, sponsored by Resource distributed energy and Solad, has a highly diversified cashflow stream from multiple markets. Virtus also has astrong team that spans Hybrid Power Technologies,Project Management and Execution, Finance and Digital technology and payments to ensure successful implementation of the projects. With the closing of this transaction, Virtus aims to deploy High Capacity Solar Systems to expand its coverage.

Thursday 25 July 2019

BUSINESS DAY

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ENERGYREPORT NNPC targets reserve increment as it secures $3.15bn financing for oil field located in the eastern axis of the Niger Delta covering a total area of 1987km².

A press release signed

by Ndu Ughamadu, group general manager, Group Public Affairs Division, quoted Mele Kyari, group managing director of NNPC, as describing the funding arrangement as “a game changer to oil and gas project financing in Nigeria”.

The boss who was represented by Roland Ewubare, Chief Operating Officer, Upstream, expressed gratitude to President Muhammadu Buhari, GCFR, for approving the transaction, adding that OML 13 held strong potentials both for the petroleum industry and the nation’s economy.

He disclosed that the Federal Government is expected to earn over $10.2bn

Olusola Bello

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he quest by the Ni g e r i a n Na t i o n a l P e t ro leum Corporation (NNPC) to increase the nation’s crude oil reserves and daily oil production to 3million barrels per day has received a major boost with the signing of a $3.15bn Financing and Technical Services Agreement between Sterling Oil Exploration and Energy Production Company Limited (SEEPCO) and the exploration and production arm of NNPC, the Nigerian Petroleum Development Company (NPDC), for the development of Oil Mining Lease (OML) 13.

OML 13 is 100 percent owned by the NPDC and is

NLNG, LCCI promote breakthrough in electric power in Nigeria

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igeria LNG Limited and the Lagos Chamber of Commerce and Industry (LCCI) have called for more efforts in finding solutions to the crippling power challenges in the country as well as exploring other energy sources and cashing in on new ideas that will help Nigeria become energy efficient.

The call was made at the Business Interactive Session on Innovation in Electric Power Solutions at the LCCI head office in Lagos. The business session featured the 2018 winner of The Nigeria Prize for Science, Peter Ngene. The 2018 winner of the Nigeria Prize for Science clinched the prize based on his work, “Nanostructured metal hydrides for the storage of electric power from renewable energy sources and for explosion prevention in high voltage power transformers”.

The Nigeria Prize for Science is a $100,000 award sponsored by NLNG to promote innovations in science and technology that will solve age-long problems and drive development in Nigeria. The prize is awarded annually.

In her remarks, Eyono Fatayi-Williams, the general manager, External Relations and Sustainable Development said the interaction session was as a result of The Nigeria Prize for Science which is increasingly shedding light on solutions to some of the nation’s problems which include electricity shortage. She stated that in recognition of the need to encourage more work in finding solutions to electric power generation in the country, NLNG used the science

prize competition in 2018 to encourage research works on the theme of that year’s competition - Innovations in Electric Power Solutions.

She remarked further that a renewed focus on electric power generation and conservation is definitely one area which can offer huge business opportunities in the country, calling on the industry to focus on renewable sources of energy to improve the Nigerian situation, promote better energy output as well as align the countrywith the global clamour for cleaner energy sources, as the world fights global warming.

“NLNG has the vision of being a global LNG company, helping to build a better Nigeria. We have been driving that vision through our numerous CSR initiatives across the country and especially in our host community, Bonny Island, where we provide over 95% stable electric power supply for over a decade now.

It will be a great achievement if this can be replicated. We believe the country has the resources but we need the industrial will-power by the private sector to make it happen, even if it happens gradually,” she added.

In his speech, the President of Lagos Chambers of Commerce and Industry (LCCI),Paul Ruwase, said there was an urgent need to change the narrative and focus on innovative ideas that can enable practical solutions. He added that the theme of the interactive the session provided a platform for reshaping the mindset of Nigerians, helping to champion the birth of new ideas and practical ways to www.businessday.ng

make the power sector work as it should in order to promote the country’s economic development.

According to Ruwase, “Reforming the power sector in Nigeria must align with the global energy direction of increasing renewables in the energy mix. Ngene’s awardwinning work further presents an opportunity for Nigeria to harness new discoveries in solving her power supply challenges. His invention has positive implications on renewable energy development that the country can benefit from. It is believed that Dr. Ngene’s work will expand the energy market in Nigeria with efficient energy storage.”

Ngene, in his presentation, titled “Nanomaterials for Energy and Power Application”, highlighted the potential of his work in the area of storing hydrogen, storage battery for renewable energy and detection of hydrogen leaks in transformers to prevent explosion. He said the explosion in transformers was one of the major causes of power outages in Nigeria, adding that through Nanotechnology, a cheap way of detecting hydrogen to eliminate suchexplosions is possible.

He remarked that energy storage was the main challenge in the use of renewable energy sources. He added that his work provides opportunities for efficient energy storage, making cheap and affordable rechargeable batteries for rural areas, for novel sensors for Diabetes, for the conversion of carbon into useful fuels and for use in cooling homes with less energy consumption.

in royalties and taxes from the project over the next 15 years, while NNPC would earn over $5bn after payment of the entire financing obligation.

He advised the management of NPDC to develop a strong community engagement strategy to forestall any crisis that could hinder operations.

The Mele Kyari disclosed that the acreage boasts of over 926 million stock tank barrels (mmstb) and 5.24 trillion cubic feet (tcf ) respectively of oil and gas reserves, adding that the Financing and Technical Services Agreement was for a period of 15 years while the $3.15bn ceiling funding would be provided by SEEPCO with a 10-year capital investment period and five years for cost recovery.

Ikeja Electric installs N500m substation in Obawole community DIPO OLADEHINDE

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n order to deepened investments and increase efficiency in its distribution electricity supply, Ikeja Electric has install a N500 million worth of 15MVA injection sub-station to O baw ole community.

Speaking at the commissioning of the sub-station at Obawole, Ifako Ijaiye Local Council Development Area of Lagos State, CEO of Ikeja Dis cos Anthony Youdewei, said that Ikeja Electric would continue to improve services to its customers.

Ma na g e r, I f a k o Ijay e Business Unit, Adedayo Adelakun, said that the invest-

ment of N500 million to put the sub-station in place was made based on re-assurance from the community that an outstanding bill of over N400 million by customers in the area would be paid.

He called on the customers to take full advantage of the payment discounts adoption by the company for its over N400million outstanding bills.

The customers led by the President, Obawole Community Development Association, Samuel Opajoni expressed satisfaction with the management of power distribution company for commissioning the project.

He assured the company of total support by all landlords and tenants at

the Obawole community particularly on the payment of their outstanding bills.

In an effort to facilitate debts owed the power industry, the management of Nigeria’s largest electricity distribution company, Ikeja Electric Plc had earlier announced the commencement of a Debt Discount Initiative for customers under its network.

The scheme, according to the company, which is designed specifically for unmetered Non-Maximum Demand (NMD) customers, was put in place to provide an avenue to support customers, especially those who are financially constrained by the present economic realities.

CBE partner Actis to provide solar power for Abuja mall

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rossBoundary Ene rg y ( C BE ) a n d Actis have entered into an agreement through which one of the malls situated in Abuja, Jabi Lake Mall would be Solarpowered. About 600KW solar plant would be installed at the rooftop of the mall.

Actis had previously collaborated with CBE on implementing the largest solar carport in Africa at Garden City Mall in Nairobi.

CBE is financing the solar plant project and will sell power to Jabi Lake Mall through an innovative 15year Power Purchase Agreement. The power offers a cheaper energy alternative and will reduce the shopping centre’s CO2 emissions by over 13,000 tonnes.

According to Funke Okubadejo, Director of Real

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Estate and Head of Actis’ Nigeria office, she said: “We were looking for a solar solution that could produce clean power for the mall and be a sustainable, self-sustaining alternative to grid and diesel.

We are thrilled to partner with CBE to achieve this as we continue to encourage the integration of solar infrastructure across Nigeria. We hope that future generations of Nigerians can enjoy the serenity of one of Abuja’s remaining blue spaces and an important water harvest area.”

In his remark,Femi Fadugba, Head of Business Development for CBE, stated: “We’ve reached a point in Nigeria where solar is transforming how businesses and everyday people are powering their lives. We’re incredibly proud to be supporting Actis in achieving its savings @Businessdayng

and sustainability goals with this landmark project.”

James Mittell, Principal in Actis’ Energy Investment Team, added: “Recognizing our responsibility to wider society is central to our business and embedded into our investment processes. Cheaper and cleaner power through solar provides an unmissable commercial and environmental opportunity and is fundamentally aligned to Actis’ belief that values drive value.”

Soventix will manage all engineering, procurement, and construction activities for the project, which is expected to create up to 30 new jobs.

Support for the project has come from Shell Foundation and the Solar Nigeria programme, an initiative implemented by Adam Smith International with funding from UK Aid.

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Thursday 25 July 2019

BUSINESS DAY

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Thursday 25 July 2019

Retail &

BUSINESS DAY

consumer business Luxury

Malls

Companies

Deals

25

Spending Trends

MALL

Nigeria retail boom wanes as investors refuse to build more malls BALA AUGIE

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ver a decade ag o, Nig er ia was at cusp of an economic boom as investors had wagered that the country’s rapidly expanding middle class, and a copious young population that craved for consumption would spur growth.

Developers began to respond to the aforementioned benign environment and positive optimism by building American style shopping mall, home to famous end brand stores, movie theatres and large supermarket chains.

In short Chinese developers and other Asian investors were looking to invest in the country’s malls.

However, the economic recession of 2016 that stoked a severe dollar scarcity that paralyzed business activities have crimped consumer spending, and the once thriving malls are not a shadow of themselves.

Nigerians are getting poorer as over 50 percent of a population of 200 million live on less than $1.98 a day; little wonder the country has overtaken India as the world’s poverty capital.

Unemployment rate is at

an all-time high of 23 percent, and to further exacerbate the already anaemic situation of consumers is the incessant fuel hike and devaluation of the currency.

While inflation rate has fallen to a 12 month of 11.22 percent in May, the figure is below the central bank’s target range of 6 percent and 9 percent.

Gross domestic product in Africa’s largest oil producer expanded by 2.01 percent in the three months through March from a year earlier.

That compares with 2.4 percent expansion in the fourth quarter. The median estimate of five economists surveyed

by Bloomberg was for growth Because consumers have refused to open their purse spring, tenants are finding it practically difficult to meet their obligations to landlords.

Most malls charge dollar rents—around $55 per square meter monthly—tenants were soon paying more than before given the sharp fall of Nigeria’s naira currency.

A tenant, who is a wife to a publisher of the one of the top Nigeria Newspapers, and who doesn’t want her name mentioned, said that the economic uncertainty served to limit budget of consumers and that most shoppers focus on buying basic goods and have reined on spending on

non-essential goods.

“A of my customers, who are high earned consumers, have relocated from the country to seek greener pastures.

The situation is worrisome, we can’t even break even,” she said.

Experts have preferred solutions to of high rent for would be tenant retailers.

Dolapo Omidire, lead researcher at Estate Intel, said investors would have to build less elaborate and smaller malls of around 7,000 square meters —around half of the size of typical large malls— and simply focus on delivering space at affordable rates. ”If I build a $100 million mall and people are showing up just to take pictures,

then it’s a big problem” said Omidire, in a recent interview with Quartz.

Embattled retailers at the Apapa shopping mall have refused to open their stores while tenants are shrinking their foot sprints more quietly by choosing not to renew expiring lease.

A total of 22 out of the 36 outlets of the two storey malls are empty, and perhaps more worrisome is that only one tenant- Spectranet- occupies a tranquil and deserted top floor that houses 15 shops, while 7 have no occupants downstairs.

Ruff N Tumble- baby cloth merchant-, Cash and Carry-a luxury, clothes and accessory firm- exited the building two

years ago while Ren Money- a loan and investment firmsleft last year.

Other retailers that had exited Apapa malls include Samsung/Sports, Bheergz Café, Sunta- a first class clothing firm- and Homely.

In 2018, the retail industry in Nigeria posted slow growth in value terms at constant 2018 prices due to harsh and unpredictably macroeconomic environment and a volatile currency.

Accroding to experts, the retail sector contributes as much as 16 per cent to Nigeria’s Gross Domestic Product (GDP).

A report by McKinsey and Company, a New York-based management consulting firm,

also estimated that the growth opportunity in food and consumer goods in Nigeria will reach $40 billion in 2020.

Analysts at Euro Monitor are of the view that the country is expected to record solid value growth, but growth is expected to pick up following the inauguration of a new government, supported by anticipated economic growth and a rise in disposable incomes.

A young technology savvy people that prefer the comfort of a mall to the brink and mortals shops will be a major driver of retail activities.

However, the lack of policy direction and delay in implementing strategic policies by the President Muhammadu led administration have been a prang to economic growth.

For instance, it took the president six months to appoint his cabinet, a habit that has prevented foreign investors from investing their money in Naira assets.

The refusal to float the currency at the zenith of the economic crisis of 2015-16 stalled foreign investment and aggravated a dollar scarcity as investors fretted that they it could be difficult for them to repatriate their money. The consequences were that manufacturers, who were unable to source dollars to import raw materials and equipment, lay off staff.

CONSUMER SPENDING

Commuters react as Lagos mulls license fee for bike hailing start-ups …Riders abandon routes as transport union demand daily fee OLUFIKAYO OWOEYE

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he plan by the Lagos State government to impose a license fee of N25million has continued to generate divergent reactions among commuters. If implemented, bike hailing platforms will cough up a license fee of about $70,000 (N25 million) annually per 1,000 bikes and N30, 000 will be paid for each registered bike rider after the 1,000 mark.

Bike hailing platforms have been well received

by Lagos commuters; the nascent industry has also attracted funding rounds from investors. Gokada was able to raise funding of up to $5.3 million from Rise Capital, Adventure Capital, IC Global Partners, and First MidWest Group, Max.ng received a funding of $1.1 million from Right Side Capital Management, Shell Foundation, and Techstars, new entrant Oride, is also backed by deep-pocket investors. Some have also expanded their operations to other cities in the country.

Parked at strategic junctions in the city, their motorcycles and helmets come www.businessday.ng

in different colors ranging from Orange, Green, and Yellow. The idea of an ondemand, flexible transport service to get around Lagos’ hours-long traffic jams and congestion is an appealing proposition for millions of residents, it’s also cheaper compared with established car-hailing services like Uber and Bolt.

In recent times, riders have also complained of rampant extortion from Road transport unions, with demands that they pay the levy before operating in the state.

Dennis Okoroafor, a rid-

er said he has restrained from plying some routes in Mushin and Ojuelegba areas of the state.

These Area boys (acting under executives of Road Transport Union) are always requesting that we buy N500 tickets, and If I don’t pay the tickets, they are not going to leave you.

I don’t have any option, I have to give them,” Dennis told BusinessDay. Mrs. Esther, a commuter said the proposed tariffs could erode the gains recorded so far in the industry and advised the government not to kill this young

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industry which has served employed several young Nigerians.

“This is proposed license fee says a lot about our business environment and it is going to send a wrong signal to investors and founders,” she lamented.

In an interview with BusinessDay, Iniabasi Akpan, Country Manager, Oride, said the proposed license fee will differentiate serious operators from the unserious ones in the industry as this will help put sanity into the industry, According to TechSci Research, a research-based @Businessdayng

management consulting firm that provides market research and advisory solutions, South Africa, Nigeria, and Tanzania are the largest two-wheeler markets in Africa. The report also predicted that the two-wheeler market in Africa will cross US$ 9 billion by 2021.

In 2012, the Lagos State Government imposed a ban on motorcycles from plying major roads in the state, especially motorcycle with less than 200 cylinder capacity. The biggest down risk to motorcycle hailing platforms remains government regulations and sanctions.

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Thursday 25 July 2019

BUSINESS DAY

Retail &

consumer business COMPANY

Flour Mills Nigeria earnings go up in Flames BALA AUGIE

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he earnings of Flour Mills Nigeria Plc have gone up in flames as the company capitulated to the harsh and unpredictable macroeconomic environment.

The receding profit has also affected valuation, as investors continue to dump shares due to disappointing earnings report and economic uncertainties.

For the year ended March 2019, the largest miller by market value in Africa’s largest economy recorded net income of N4.0 billion, the lowest in the last five years (See Charts).

A further analysis of profit figures showed there was 70.05 percent drop in year on year at the bottom lines between 2019-18, the steepest slump in five years.

Revenues have been growing at a slow pace since 2017 as the company can no longer pass on rising cost to belea-

guered final consumers in form of higher price.

Sales were down 2.81 percent to N527.40 billion in the period under review, as against N542.67 billion the previous year.

Since Flour Mills’ revenue growth can’t cover cost of production, its profit margins have continued to shrink.

That means the miller has not been using the resources of shareholders in generating higher profit.

Net profit, a measure of efficiency and profitability, fell to 1 percent as at year end March 2019, the sharpest drop

in five years.

Similarly, earnings before interest and taxation (EBIT), which shows the relationship between total costs and revenue, dipped to 6 percent in the period under review, the lowest since 2017.

Gross margin, which is the difference between revenue and cost of sales, fell to 10 percent, the lowest in five years.

Flour Mills and other consumer goods firms are grappling with deteriorating margins, brought on by subdued consumer spending,

smuggling, and continued traffic gridlock in the road network to Apapa port.

Post-recession, growth in real household consumption peaked at 3 percent in the final quarter of 2017, before falling to 1 percent in the second quarter of (Q2-18).

Disruptions at the port, hindered production and distribution activities, as costs pressures remained, even as sales declined.

As a result of the decrepit infrastructure, Flour Mills cost of sales ratio, increased to 89.88 percent in yearend 2019, from 87.32 percent the corresponding period of 2018.

That means the company spent N0.89 on input cost to generate each unit of revenue.

However, Flour Mills’ deleveraging strategy has yielded fruit as there has been a reduction total debt and interest expense.

Total Debt (both long term and short term) stood at N117.28 billion as at year end March 2019, the lowest level since N125.11 billion in Full year 2014.

Finance costs dipped stood at N22.89 billion as at Year end March 2019, the lowest level since N22.39 billion in 2016.

The miller’s operating profit can cover interest expenses as times coverage ratio is 1.41 times, albeit below the 1.50 times internal bench mark.

“Our strategy to restructure the balance sheet base and optimize the finance cost have started to yield the desired results, as the business showed some level of efficiency,” said Anders Kristiansso, Group Chief Finance Officer of Flour Mills.

Paul Gbededo, Group

Managing Director, said the company has made substantial progress this year even in the face of an adverse and challenging environment.

“Our Growth and efficiency initiatives across our various functions and businesses have started to show antici-

pated gains as we continue to focus on organic sales growth and position the business for continuous profitability,” said Gbededo.

The steep drop in profitability has undermined valuations, but it is an entry point for investors that crave for cheap stocks.

COMPANY

Pepsi expands operation acquires Pioneer Foods makers of Butterfield Bread OLUFIKAYO OWOEYE

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oft drink giant, Pepsi, has acquired Pioneer Foods Group Limited, the company that owns Nigerian bread brand, Butterfield. In a deal worth around $1.8billion and according to Pepsi, Pioneer Food’s product portfolio is complementary to its own

and would help PepsiCo to expand in sub-Saharan Africa by adding manufacturing and distribution capabilities.

Analysts say Pepsi is using the acquisition to make an inroad into the Nigerian confectionary market, while existing brand should poise for intense competition as Pepsi has the capital to invest in research and development.

Bread is a staple food in most homes, a fast food for a

population of 200 people.

According to a KPMG report, Nigeria’s bread market is growing at a faster rate with 72percent of the $621millionindustry dominated by small and medium scale bakers.

“The Nigerian bread market and other baked goods segments are highly fragmented, with 72percent of the market is controlled by artisans and other relatively small players.

Notable bakers are Magnified Bread, Excellent Bread, Salama Bread just to mention few. Retail stores such as Shoprite and other small retail outlets also produce their bread considered as fresh by many Nigerians.

For many without much insight into the industry, the business of bread making is very lucrative; however, a major challenge facing the industry is the saturation of that

space with too many players.

This explains the many bakeries-both certified by NAFDAC and non-certified

by NAFDAC-in all nooks and crannies of the country. Closely related to this is the activities of unregistered, unlicensed and undocumented producers of bread, who are not under any obligation to adhere to NAFDAC’s health and other safety standards. They pose a risk not just to the regulated

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bakers but to the final consumer, as well.

Pioneer Foods International expanded its footprint in the Nigerian market through the acquisition of a majority stake in Food Concepts Pioneer, a leading baked goods company. With its primary focus on bread, the company owns the well-established Butterfield brand, distributed in key markets in the country from its bakeries.

Thursday 25 July 2019

BUSINESS DAY

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BUSINESS TRAVEL Feedback from customers helps us redesign our products - Ottavi Sandra Ottavi is head Long-Haul Customer Experience, Air France. In this interview with IFEOMA OKEKE in Paris, she speaks on the services AirFrance offers in its refurbish A330 fleet.

How do you develop customer experience between Nigeria and Paris on the 330 fleet? e really wanted to offer our customers a new travel experience. The new A330 offers a total different travel experience. There are new sits, new cabin, new product and services. We are offering something very elegant.

The Business class seat has the latest full flat bed, latest generation of touch screen over 18 inches, which is one of the largest in the market.

This shows that we pay a lot of attention on the comfort and elegance of our customers. We have some lightening to enhance the decor of the cabin. In the business cabin, the seat has been given much attention to make sure that customers have the utmost comfort and you can enjoy full company with even your travel partner, enjoying glass of Champaign for instance.

We have great wine selection.

So, it is a brand new business seat that combines elegance and comfort at the best standard. The seats on premium economy and economy

W

Sandra Ottavi

have been really worked on.

They are appreciated by our customers. In the premium economy seats, we have got a wide space, 130 seat recline. In economy, the seat is also worked on to ensure comfort of passengers. In all the seat cabins, we have the

latest generations of screens, which is very important for our customers. So, it gives you the kind of attention regarding comfort. The entire aircraft has been redesigned from the entrance, the toilets, the dinning and the selfservice bar which is being

completely redesigned. We are very proud to offer these to our customers. In 2019, it is really the French touch and new service implemented on board. You will be able to enjoy the cocktail experience. The menu also has been redesigned. This is the attention we want to give to our customers so that it is not only about travelling, it is also about redesigning the cabin, so that you really feel welcomed as a special guest.

The aviation business is a very expensive business where the profit margin is quite small. Why is AirFrance/ KLM paying so much attention to put all these together and create the customer experience?

This is not a question for us, it is in our DNA. We do want to provide the best experience for our customers every day. We will be so proud when passengers leave the plane and arrive their destinations to share their experiences on board with others.

How do you measure the feedback from your customers?

We pay a lot of attention on customer feedback and we have made it in such a way that we provide materi-

Addis Ababa Airport sees surge in passenger traffic for summer IFEOMA OKEKE

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ddis Ababa Bole International Airport, the major gateway into Africa is seeing an increase in the number of passengers processed in its terminal this summer.

Wednesday, July 17, 2019 was one of the busiest days for the Airport with 310 flights and 29,528 travellers (21,028 departing and 8,500 arriving passengers, respectively) which marked a record number of daily passengers served at the terminal.

Commenting on the Airport’s preparedness for the peak season, Getaneh Adera, Director of Bole International Airport and Acting CEO of Ethiopian Airports said, “With the partial opening of the new terminal which will more than double the capacity of the airport, we are very excited to serve record number of passengers in this

summer.”

As the home base of Ethiopian Airlines, Africa’s largest flag-carrier serving over 120 cities around the world, Addis Ababa has turned into a bustling hub handling hundreds of flights each day. The Airport has seen a major expan-

sion recently which will boost its capacity to cater to 22 million passengers annually.

Upon going fully operational, the expanded terminal will feature state-of-the-art airport facilities, elegant and spacious check-in, arrival and departure halls, various

duty-free shops, restaurants, and many other accommodations, taking the entire passengers’ experience to a whole new level. It is to be recalled that last year Addis Ababa surpassed Dubai as the top transit hub for long haul passengers into Africa.

R-L: Olatokunbo Fagbemi, group managing director/CEO, nahco aviance; group chairman, Seinde Fadeni Oladapo; Lawal Badamasi (rtd), security manager, and Muyiwa Olumekun, group executive director, corporate services, during the Award of Merit bestowed on Badamasi by the Company in Lagos www.businessday.ng

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als where you can answer questions on how you feel on-board and get on-the-spot feedback which is really useful for us. The voice of the customer is so useful and it helps us redesign our products.

How do you ensure that one-on-one relationship with the crew on board and your passengers?

Personalisation is key. The crew has the ability to provide real time information and reassurance and to enhance personalisation with the customers which is so important.

When you get into the plane, the crew welcomes you. You will be served by the crew members a complementary glass of Champaign with brand new glasses. This is the French signature. The way we see French hospitality is what we portray here.

Before you leave, you will be given a French candy, just to say ‘thank you for travelling with us.’ It is about giving something special to our customers.

Connectivity is something very important because it changes the whole experience. We have customer intimacy and try to have an endto-end relationship. For instance we have a programme

which is client continuity, so that you feel welcomed and where the cabin crew come to you to know you and who you are. The idea is to have that intimacy with the passengers and create end-to-end relationship.

KLM will is also 100 years and Air France is 85 years but these two brands have not lost touch with change. What is the secret behind your success as one of the oldest airline across the word and still retaining good market share?

Every man and woman working with Air France tries to improve themselves to provide the best experience.

If you have to do so, you have to renew your offer because we try to meet the needs of our customers because their needs and ways of living are different.

What efforts are you making to eliminate single use of plastics on board in a bid to keep the environment clean?

We are fully committed to this. We have an initiative we are working with to eliminate the single use of plastics onboard and we want to multiply the initiative and to go a step further. So, we are at the beginning of this, which is very important for us.

EX FAAN director tasks FG on creation of Civil Aviation Board to tackle BASA challenges IFEOMA OKEKE

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he former director of Operations, in the Federal Airports Authority of Nigeria (FAAN), Henry Omeogu, has called on the federal government to create a Civil Aviation Board (CAB) to tackle most of the challenges facing the Nigerian aviation industry, especially the airline sub-sector.

Speaking with journalists in an interview at the recent 23rd Annual Conference organised by the League of Airport and Aviation Correspondents (LAAC) in Lagos, Omeogu insisted that without the CAB, the challenges facing the industry would continue.

He attributed the continuous imbalance in the Bilateral Air Services Agreement (BASA) arrangements Nigeria has with other countries to the lack of CAB in the system.

According to him, an attempt was made at correct@Businessdayng

ing this anomaly when he served as the Deputy Director, Air Transport in the Ministry of Aviation between 1996 and1998 and equally chaired the sub-committee on Airline development in Nigeria.

Omeogu, explained that as a result of the recommendations of the committee, two directorates were established to tackle the issues of safety regulations and economic regulations.

He gave the names of the directorates as Directorate of Safety Regulations and Monitoring (DESRAM), which he said metamorphosed into the current Nigerian Civil Aviation Authority (NCAA) and the Directorate of Economic Regulations and Monitoring (DERAM), which he said was meant to transform into CAB. He declared that the essence of CAB was to tackle economic issues that affect the airlines, among which was BASA.

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Thursday 25 July 2019

BUSINESS DAY

TECHTALK Innovation

Apps

Fin-Tech

Start-up

Gadgets

Ecommerce

IOTs

Broadband Infrastructure

Bank IT Security

Isa Pantami: Nigeria’s next ICT Minister? nical Writing in 2014. He made professor in Madinah where he lectured in the new Faculty of Computing and Information Systemsof the university.

In 2016, he was confirmed by President Buhari as part of the 13 newly appointed chief executive officers for 13 government agencies. His directive for NITDA upon employment was to develop the ICT infrastructure in the North East.

Stories by FRANK ELEANYA

M

any stakeholders in Nigeria’s ICT sector can now heave a sigh of relief as the name of former minister of ICT; Adebayo Shittu was conspicuously missing from the ministerial list released on Tuesday.

President Muhammadu Buhari finally transmitted the list of his nominees to the senate for confirmation, with only twelve members of the old cabinet returning to the country’s service.

Of particular interest for the tech ecosystem and ICT industry was the position of the minister in the ministry. The previous occupant of that position, Adebayo Shittu, according to many stakeholders, left little to be desired. Many had seen the appointment of the minister as a mere compensation for his role in the election of President Buhari, in which the president’s party won in Oyo state where the former minister comes from.

But if his appointment was a concern, his four years stewardship as minister of ICT was seen as a big disappointment and riddled with many controversies.

While his omission from

Isa Pantami

the list may significantly have to do with his poor record in office, his unabashed political pursuit which saw him falling out many times with the leadership of the party at the national level and consequently contributing to APC’s loss to PDP in the state may have been the last straw.

In any case, with Shittu out of the picture, the attention in the coming days would likely turn to the inclusion of Ali Isa Pantami,

current director general and CEO of National Information Technology Development Agency (NITDA), on the list. Being the only nominee with a significant ICT experience and background it is to be expected that the President will hand the ministry over to him.

The ministry of information and communication technology (ICT), created in 2011, has five agencies including, Nigeria Communications Commission (NCC); NITDA; NIPOST;

NigComSat and Galaxy Backbone.

NITDA is the agency that implements the ICT policy of the ministry of communication. It has the sole responsibility of developing programs that caters for the running of ICT related activities in Nigeria.

It is also mandated with the implementation of policies guidelines for driving ICT in Nigeria.

NITDA’s strategic position in the ministry, should give the current DG a better per-

spective to manage its affairs.

Who is Isa Pantami?

Isa Ali Pantami is a 47 year old graduate of Computer Science and PhD holder in Computer Information System from the Robert Gordon University of Aberdeen, Scotland, United Kingdom.

Before his appointment in NITDAY, Pantami lectured at Abubakar Tafawa Balewa University in Information Technology and later joined the Islamic University of Madinah as head of Tech-

Alleged EFCC investigation Despite his very glossy ICT resume, Pantami’s stewardship as DG of NITDA has had some snags. For instance, in 2017 the former minister of ICT, Adebayo Shittu, was reported to have alleged in a radio programme in Ibadan that Pantami was being investigated by the Economic and Financial Crimes Commission (EFCC) over award of contracts at the agency.

The allegation was originally made by Kadunabased Good Governance and Accountability Monitoring Group. According to the group, Pantami did not follow due process of the Procurement Act in awarding a Galaxy Backbone contract.

NITDA however denied it was under investigation by the EFCC.

How we blocked 6.9m cyber threats in 2018 – Trend Micro boss

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rend Micro, a global cyber security and defence company, with offices in more than 50 countries, said it helped organisations and government institutions to detect and ward off 6.9 million cyber threats in 2018.

The company’s vice president, sub-Saharan African region, Indi Siriniwasa disclosed this at recent a partner meeting in Lagos, Nigeria. The company unveiled its new channel partner programme for sub-Saharan Africa region during the meeting.

According to him, cyber threats to businesses are

becoming widespread as hackers are exploring loopholes in justice system to grow their confidence.

“It is a big business,” he said during an interview with reporters. “It is much easier to hack organisations and steal money than breaking an ATM machine.

An ATM machine can bring publicity and probably get the police involved. But if you are good hacker, you can hack an organisation and steal money and get away with it. The legal system is still far behind in terms of the hacker community.”

He noted that the evolving tactics of hackers calls for organisations to always

stay alert and ensure that their digital assets are protected round the clock. This is more important now that data has become the digital oil and any hacker will do everything to get their hands on sensitive information belonging to organisations and customers.

Trend Micro has been the world’s leading hybrid cloud security provider for the past eight years in a row.

Siriniwasa said it is due to commitment to stay ahead of the trends and anticipate every potential cyber security threat.

“20 years back cyber security was the IT guys’ problem. It is not IT any more, the CEOs have a big

role to play no. when a firm in South Africa was hacked, the CEO had to come and apologise to the customers.

Everyone is responsible it is not about IT anymore.

It is about responsibility to protect the information and their customers,” he said.

To be sure, hybrid cloud is a cloud computing environment that uses a mix of on-premises, private cloud and third-party, public cloud services with orchestration between the two platforms. On the security side, the VP explained that, Trend Micro provides different security strategies for the various components of data storage. This is even more im-

portant for organisations where there are various classifications of information such as highly sensitive data and public data.

These may require different protections plans.

Siriniwasa disclosed that it was increasing its investment in West Africa following the growth of channel ecosystem in the past two years. The channel programme, among other benefits, has seen significant improvement in knowledge of the cloud leading to more customer adoption.

The programme was designed to assist existing partners to grow their business and pave way for new partners to get

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

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onboarded with as few roadblocks as possible; delivering everything needed to quickly get up to speed, close new business, and ensure success. Following a tiered approach, the programme is made up of bronze, silver, gold and platinum partners with varying benefits based on the sales and technical competencies of partners.

“We believe that with our reenergised channel programme we can fast track the development of our partners and ensure they meet the ever-changing security demands of an industry bombarded by disruptive technologies,” Siriniwasa said.

Thursday 25 July 2019

BUSINESS DAY

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LegalBusiness BD Business Law Industry Report Practice Intelligence Partnerships

A Drilling Rig As A Vessel: Distinguishing The Transocean Case Vis A Vis Seadrill Case OLUWOLE AKINYEYE

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he Court of Appeal in the recent Judgment of Transocean Support Services Nigeria Limited & 3 Ors v Nigerian Maritime Administration and Safety Agency & 1 Or: Appeal No:CA/L/ 503/2016, held that drilling rigs cannot be deemed to be vessels for the purpose of the Coastal and Inland Shipping (Cabotage) Act, 2003 and liable to the 2% surcharge as stipulated in the Cabotage Act. In arriving at its decision, the Court of Appeal gave consideration to the provisions of the Cabotage Act and held that either both or one of two conditions had to be met in order for a drilling rig to be classified as a vessel under the Cabotage Act. The first condition is that in order for a drilling rig to be deemed as a vessel eligible for registration under the Cabotage Act, it was crucial to show thatthe rig was designed, used or capable of being used solely or partly for marine navigation and used for the carriage on, through or under water of persons or property without regard to method or lack of propulsion.

The second condition is that a

Oluwole Akinyeye

drilling rig could be classified as a vessel under the Cabotage Act, if it is shown that the rig was listed among the machineries expressly identified

as vessels in the Act. It is crucial to note that the Court of Appeal expressly stated that either both or one of these two conditionsare necessary

to make a drilling rig a vessel under the Cabotage Act. The RespondentsinTransoceanfailed to show that thedrilling rig in contentionsatisfiedany of the two conditions identified by the Court of Appeal. As a result, the Court of Appeal held that a drilling rig could not be classified as a vessel under the Cabotage Act and further held that the listing of drilling rigs under the head of foreign vessels in the Guidelines on Implementation of Coastal and Inland Shipping (Cabotage) Act 2003, Revised 2007, was beyond the powers of the Minister of Transport.

At first blush, the Court of Appeal’s decisionwould appear to have overturned the judgment delivered in the recent Federal High Court case of Seadrill Mobile Units Nigeria Limited v The Honourable Minister for Transportation & 2 Ors, however, this is not so. In Seadrill, it was held that the drilling rig in contention was a vessel under the Cabotage Actbecause it satisfied one of the conditions identified by the Court of Appealin Transocean, which is that the rig must be capable of being used for marine navigation and for the carriage of property and persons.

This is different from the position in Transoceanwhere the Respondents

failed to establish that a drilling rig satisfied any of the two conditions laid down by the Court of Appeal for the purpose of classifying the rig as vessel under the Cabotage Act.This clearly reflects that the decision in Seadrillis distinguishable from the decision in Transocean.

From the above, the effect of the Court of Appeal’s decision in Transocean isthat a drilling rig could be considered as a vessel under the Act, if it satisfied the condition that it is capable of being used for marine navigation and for the carriage of property and personswithout regard to method or lack of propulsion,irrespective that the drilling rig is not expressly listed as a vessel under the Cabotage Act. Given this position, there is the likelihood that there could be more cases seeking determination of whether a particular drilling rig is a vessel under the Cabotage Act, which will be decided on a case by case basis.In light of this position, it would appear that the final word is yet to be heard regarding the controversial matter of whether a drilling rig is a vessel under the Cabotage Act. Dr .Oluwole Akinyeye heads the Maritime Unit at Olisa Agbakoba Legal.

SimmonsCooper law firm refutes newspaper allegation of involvement in tax fraud

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immonsCooper Partners, the law firm falsely alleged by a Nigerian newspaper to be associated with/involved in a N100 billion tax evasion scandal with Alpha Beta Consulting Limited, has, on Wednesday, July 18, 2019, refuted the allegations and gave the Newspaper 72 hours to retract the false accusation or face legal actions for defamation and malicious falsehood.

On July 13, 2019, the Saturday edition of the Newspaper published a headline story titled “Osinbajo’s firm linked to company fingered in alleged N100bn Alpha Beta scam”, where it alleged that SimmonsCoopers Partners, the law partnership firm formerly headed by Prof Yemi Osinbajo SAN, before he was elected the Vice President of Nigeria, served as Company Secretary to Alpha Beta Consulting Ltd. However, in a press released signed by the Managing Partner of SimmonsCooper, Dapo Akinosun, on Thursday, July 18, 2019 the law firm refuted the story, stating that it is not involved, in any shape or form, neither does it have a link with, the alleged tax evasion, money laundering, nor corruption claims al-

Vice President Yemi Osinbajo

leged against any of the corporations identified in the Publication.

He further stated that the firm has never been retained by Ocean Trust Limited to offer secretarial services as alleged by Punch Newspapers. “As is custom with filings as Company Secretary, there is no acceptance letter by the firm consenting to the purported appointment, or any other filing undertaken by the firm as Company Secretary at the registry of the Corporate Affairs Commission”, he said.

Akinosun acknowledged Prof.

Osinbajo (GCON) as a “one time senior partner” of the law firm who www.businessday.ng

resigned from the firm upon his election as Vice President, Federal Republic of Nigeria, in line with international best practices. “SimmonsCooper Partners is a product of the combination of her members’ intellectual capital, industry and integrity garnered for several years.

We are proud that Professor Osinbajo continues to epitomize these values even in public service”.

See Excerpts below: “SimmonsCooper Partners’ (“the Firm”) attention has been drawn to certain allegations, assertions and other false accusations made against her in the front page of the Punch Newspapers of July 13th 2019, titled “Osinbajo’s firm linked to company fingered in alleged N100bn Alpha Beta scam” (“the Publication”); For the record, SimmonsCooper Partners refutes all the false allegations imputed against the firm, her members and persons currently or previously associated with the firm.

The Publication singled out, not only SimmonsCooper Partners, but also Professor Yemi Osinbajo (SAN) (GCON), a onetime senior partner and member of the firm, for public opprobrium; The Publication contains untrue

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and highly defamatory statements towards the firm, some of which contain malicious falsehood. In doing so, defamatory statements are being communicated to millions of people throughout the world, diminishing the firm’s reputation and that of various individuals who have worked at, and continue to work, at SimmonsCooper Partners; SimmonsCooper Partners states that it is not involved, in any shape or form, neither does it have a link with, the alleged tax evasion, money laundering, nor corruption claims alleged against any of the corporations identified in the Publication. For the avoidance of doubt, SimmonsCooper Partners has never retained a physical or correspondent address at “B5 Falomo Shopping Complex, South West Ikoyi, Victoria Island”.

This address is copiously portrayed in the published CAC Form 2.1, purportedly, as proof of the linkage between the firm and the subject matter of the allegations, whereas, a cursory inquiry by Punch could have shown that this address is neither the firm’s registered address nor its principal office. The firm categorically states that it has never been retained by Ocean Trust Limited to @Businessdayng

offer secretarial services as alleged

by Punch Newspapers or at all. As is custom with filings as Company Secretary, there is no acceptance letter by the firm consenting to the purported appointment, or any other filing undertaken by the firm as Company Secretary at the registry of the Corporate Affairs Commission; The Publication seems designed to damage the reputation of SimmonsCooper Partners and its past and current members rather than have any fair comment basis. The Publication was a false statement of fact, intentionally published in print and on the Internet, to millions of people within Nigeria and around the world. The malicious intent is demonstrated by the fact that a public search at the Corporate Affairs Commission shows that Ocean Trust Limited has a subsisting company secretary that had been appointed since 2011, which fact was curiously left out by the Punch Newspapers in the Publication. We believe that the Punch Newspaper’s admission to “rush to press” with the Publication, was motivated by malice and calculated to cause harm to the firm Continues on page 31

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Thursday 25 July 2019

BUSINESS DAY

RIGHTSWATCH

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LegalBusiness

SERAP drags senior Nigerian officials to ICC ‘for leaving 13.2 million children out of school’

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ocio-Economic Rights and Accountability Project (SERAP) has sent a petition to Mrs. Fatou Bensouda, Prosecutor, International Criminal Court (ICC), urging her to use her “good offices to investigate whether the problem of out-of-school children in Nigeria, and the failure of the Nigerian authorities over the years to address it amount to violence against children and crimes against humanity within the jurisdiction of the ICC.” The organization urged Mrs Bensouda to: “push for those suspected to be responsible for this problem, including current and former presidents and state governors since 1999, who directly or indirectly have individually and/ or collectively breached their special duty toward children, and are therefore complicit in the crime, to be tried by the ICC.” In the petition dated 19 July 2019 and signed by SERAP deputy director Kolawole Oluwadare, the organization said: “Investigating and prosecuting high-ranking Nigerian officials and providing reparations to victims will contribute to serving the best interests of Nigerian children, the most vulnerable citizens in our country, and ending the impunity that is denying them their right to education and a life free of violence and fear.”

SERAP said: “These out-ofschool Nigerian children have been exposed to real danger, violence and even untimely death.

Senior Nigerian politicians since 1999 have failed to understand the seriousness of the crime of leaving millions of children out of school, and have made an essential contribution to the commission of the crime.”

SERAP also said: “The ICC has stated in the Lubanga case that the interruption, delay and denial of the right of children to education is a crime within the jurisdiction of the Court. SERAP believes that the reality for children living in the Ituri region of the Democratic Republic of the Congo is similar to the reality faced by millions of out-of-school children in Nigeria, as the situation is depriving an entire generation of children of their right to education and human dignity.”

The petition read in part: “There is no immunity for crimes under the Rome Statute. The crime of leaving millions of Nigerian children out of school is an opportunity for your Office to show the Court’s commitment to effectively enforce its Policy on Children and other important statements of international criminal justice.”

“Putting millions of Nigerian children that should be in school on the street exposes them to violence, including sexual violence, gender violence, abduction, and other forms of exploitation and violence against children, and implicitly amounts to enslavement,

trafficking of children, and illtreatment, three of the eleven acts that may amount to a crime against humanity under the Rome Statute.”

“Unless the ICC declares the problem of over 13 million out-ofschool Nigerian children as violence against children and crime against humanity, and hold those suspected to be responsible since 1999 to account, the number of outof-school children will continue to rise, and these children may never receive any formal education at all.”

“Nigeria is a state party to the Rome Statute and deposited its instrument of ratification on 27 September 2001. According to Nigeria’s Universal Basic Education Commission (UBEC), the population of out-of-school children in Nigeria has risen from 10.5 million to 13.2 million.”

“This figure is based on a joint survey conducted in 2015 by the United Nations Children Fund (UNICEF) and the Nigerian government. Data by the UNICEF also shows that one in every five of the world’s out-of-school children is in Nigeria. However, Nigeria’s former Minister of Education, Adamu Adamu has suggested the figure of out-of-school children in Nigeria to be 10,193,918, citing a recent ‘National Personnel Audit’ of both public and private schools in the country.”

“According to the former Minister of Education, all of the 36 states in Nigeria are affected by the problem of out-of-school children but the problem is more widespread and systematic in the following states: Kano, Akwa Ibom, Katsina, Kaduna, Taraba, Sokoto, Yobe, Zamfara, Oyo, Benue, Jigawa and Ebonyi states.”

“Girls are disproportionately represented among out-of-school children. In north-eastern Nigeria alone, 2.8 million children are in need of education-in-emergencies support in three conflict-affected States (Borno, Yobe, Adamawa).

In these States, at least 802 schools remain closed and 497 classrooms are listed as destroyed, with another 1,392 damaged but repairable.”

“Under Nigerian law and international human rights treaties to which Nigeria is a state party, the Nigerian authorities at both the Federal and State levels have a legally binding obligation to immediately provide free, universal quality primary education for all Nigerian children, and to progressively provide education at all other levels without discrimination.”

“Nigerian authorities over the years have restricted educational opportunities for children with disabilities including by failing to provide equipment such as hearing aids, ramps to school buildings, wheelchairs, crutches, glasses and surgery to children in need, and failing to address educational challenges facing children with disabilities, in general.

“SERAP notes the launch by www.businessday.ng

your Office in 2016 of the Policy on Children, which aims to send ‘a firm and consistent message that humanity stands united in its resolve that crimes against children will not be tolerated and that their perpetrators will not go unpunished.’ The Policy aims to assist your Office in its efforts to robustly address these crimes, bearing in mind the rights and best interests of children.”

“SERAP notes also that at the launch of the Policy you stated among others that, ‘a crime against a child is an offence against all of humanity; it is an affront to our basic tenets of human decency.

Children are our greatest resource, and must be protected from harm so as to reach their full potential.

We, at the ICC, intend to play our part through the legal framework of the Rome Statute’.”

“This statement is entirely consistent with the UN Convention on the Rights of the Child, to which Nigeria is a state party and shows that children will not be invisible in the exercise of the jurisdiction of the ICC, and that your Office will extend its work to ensure the well-being of children, including millions of out-of-school Nigerian children.”

“The Rome Statute’s sensitivity towards children’s issues is clearly demonstrated in Article 68(1) to the effect that the Court must ‘have regard to all relevant factors, including gender and the nature of the crime, in particular, where the crime involves sexual or gender violence or violence against children.’ Under Article 54(1), ‘the Prosecutor shall take into account the nature of the crime, in particular where it involves violence against children.’”

“SERAP is seriously concerned that the problem of out-of-school children is widespread and systematic, cutting across the 36 states of the country and Abuja, and spanning many years since 1999. The problem of out-of-school children has had catastrophic effects on the

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lives of millions of children, their families and communities, akin to violence against children under the Court’s Policy, and crimes against humanity as contemplated under the Rome Statue.”

“The Rome Statute in article 7 defines “crime against humanity” to include “inhumane acts causing great suffering or injury,” committed in a widespread or systematic manner against a civilian population. The common denominator of crimes against humanity is that they are grave affronts to human security and dignity.”

“The consequences of throwing millions of Nigerian children that should be in school out on the street are similar to those of the offences in article 7(1)(k) of the Rome Statute. Senior government officials know well or ought to know that their failure to prevent millions of Nigerian children from roaming the street will expose the children to violence, deny them their human dignity and exacerbate the growing insecurity in the country.”

“SERAP considers the apparent failure of successive governments and high-ranking government officials to prevent widespread and systematic problem of outof-school children as amounting to complicity under the Rome Statute.”

“This crime against Nigerian children has continued to rob our children of their innocence, childhood, and often, tragically, resulted in their untimely deaths, denying Nigeria of its future potential and of its greatest resource.”

“The national authorities of the Court’s States Parties form the first line of defense in addressing the crimes against children, as they shoulder the primary responsibility for the investigation and prosecution of perpetrators of the crimes. But successive governments in Nigeria have been unwilling or unable to address the problem of out-of-school children, and end the crime against humanity.”

“SERAP believes that substan@Businessdayng

tial grounds exist to warrant the intervention of the Prosecutor in this case. Pursuant to the Rome Statute, the Prosecutor has power to intervene in a situation under the jurisdiction of the Court if the Security Council or states parties refer a situation or if information is provided from other sources such as the information SERAP is providing in this case.”

SERAP therefore urged the ICC Prosecutor to: Urgently commence an investigation proprio motu on the widespread and systematic problem of out-of-school children in Nigeria since the return of democracy in 1999, with a view to determining whether these amount to violence against children and crime against humanity within the Court’s jurisdiction. In this respect, we also urge you to invite representatives of the Nigerian government to provide written or oral testimony at the seat of the Court, so that the Prosecutor is able to conclude since available information whether there is a reasonable basis for an investigation, and to submit a request to the PreTrial Chamber for authorization of an investigation: Bring to justice those suspected to be responsible for widespread and systematic problem of out-ofschool children in Nigeria; Urge the Nigerian government to fulfil its obligations under the Rome Statute to cooperate with the ICC; including complying with your requests to arrest and surrender suspected perpetrators of the widespread and systematic crime of leaving millions of Nigerian children out of school, testimony, and provide other support to the ICC. Compel the Nigerian authorities at the Federal and State levels to ensure that millions of out-ofschool children are afforded their right to education, access to justice, and ensure reparations to victims, including restitution, compensation, rehabilitation and guarantee of non-repetition.

Thursday 25 July 2019

BUSINESS DAY

INDUSTRYFILE

BD

31

LegalBusiness

Aluko & Oyebode holds 2019 Capital GLOBALREPORT Global firm enters ‘legal Markets Roundtable in Lagos

engineering’ market with buyout

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he 2019 Aluko & Oyebode capital markets sector roundtable takes place today Thursday July 25th in Lagos.

It is expected that the roundtable, which seeks to provide a platform for stakeholders to discuss frontline issues and identify challenges relating to the administration of competition law in Nigeria, will result in fruitful deliberations among regulators, business owners and advisers that will help shape the policy and practice of competition law in Nigeria.

The theme of the roundtable, “Engendering an Effective Regulatory Landscape for Competition Law in Nigeria - Promoting a Fairer Market” will see stakeholders across various sectors of the

SimmonsCooper law firm...

Continued from page 29

and its past and current members; Further, the imputation that offering professional services to a company, by itself, creates an association with alleged wrongdoing, is neither customary nor reasonable.

We are certain that Punch Newspapers has external legal advisers who will not be taken to be privy to, or actors in, the defamation alleged herein, or indeed in other matters of liability that may arise in the course of running Punch’s business. Offering professional services, by itself, cannot be characterized as wrongdoing. The insinuation that the firm, its past and current members are somehow associated with alleged tax evasion, corruption, the suppression of investigation and obstruction of justice is not only unjustifiable and unreasonable, but also malicious in intent. Without more, the Publication has definitely held the firm up to scorn, ridicule, disgrace, and contempt in the minds of the readers of the Publication; SimmonsCooper Partners, today, is a product of the combination of her members’ intellectual capital, industry and integrity garnered for several years. We are proud that Professor Osinbajo continues to epitomise these values even in public service. In line with international best practices, upon his election as Vice-President of the Federal Republic of Nigeria, Professor Osinbajo resigned his membership of the firm; The firm is aggrieved by the wanton, mischievous and most unprofessional manner in which the Punch Newspapers has published the defamatory statements in the Publication. SimmonsCooper Partners intends to seek redress to the fullest extent available in law and has requested the Punch Newspapers to do all of the following: • remove from publication in their entirety the defamatory publication and all online threads to prevent further harm to the Firm’s business; • produce an apology and a declaration that the allegations referred to are false and defamatory and

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economy deliberate on critical issues around this theme.

Leading the discussions at the roundtable is the Chief Executive Officer of the Nigerian Stock Exchange (NSE), Oscar Onyema, who is the keynote speaker at the event.

O t h e r s p e a k e r s i n c l u d e, Babatunde Irukera, Director General/Chief Executive, Federal Competition and Consumer

Protection Commission (FCCPC), Mfon Bassey, Deputy Director, Securities and Exchange Commission (SE C ), Olusola Carrena, Head of Corporate Finance, Stanbic IBTC Capital, Daryl Dingley (Partner, Webber Wentzel), Eric Idiahi (Co-Founder/Partner, Verod Capital Management Limited) and Ayodeji Oyetunde (Partner, Aluko & Oyebode).

PHOTOFILE

nternational law firm Simmons & Simmons has become the latest practice to stake a claim to the cutting edge of legal technology with the acquisition of a pioneer in ‘legal engineering’.

Wavelength was the first law firm to brand ‘legal engineering’ as a specific offering, providing both legal advice and legal tech consulting, building bespoke legal tech products for law firms and corporate legal teams. Simmons & Simmons said today that, as part of the firm, Wavelength will introduce new services and solutions for clients around the globe.

Wavelength is based at Barclays Eagle Labs startup incubator in Cambridge. The sale follows a period of rapid expansion for Wavelength, which recently made several high-profile hires and opened a London office.

This continues the trend of consolidation among the first wave of legal tech start-ups following Riverview Law’s acquisition by EY and Thomson Reuters’ acquisition of collaboration platform HighQ last week. Wavelength will continue to be led by co-founder Peter Lee and Drew Winlaw from offices in Cambridge and London.

Lee said: ‘Simmons & Simmons is seeing increasing demand for our skillsets from within their

Peter Lee

client base and this transaction provides us with an excellent opportunity for us to scale together.’

Jeremy Hoyland, managing partner at Simmons & Simmons, said: ‘This is an exciting opportunity for the firm and one that will give our clients a clear advantage.

It demonstrates that we are serious about delivering smarter solutions for our clients and that we are driving change for the better in the legal market.’

No financial details were disclosed. Wavelength posts only abbreviated accounts as a small company. Its latest balance sheet for the year ending 30 April 2018 shows net assets of £144,942. In its latest accounts, for the year ending 30 April 2018, Simmons & Simmons reported pre-tax profits of £111.6m on a turnover of £357.7m.

AI contract drafting startup raises £2m Deputy Governor of Oyo State, Eng Rauf Olaniyan who represented the Governor, fielding questions from journalists at the maiden edition of the HON. JUSTICE PIUS OLAYIWOLA ADEREMI Lecture series.

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Hon Justice Olu Ariwoola JSC, representing the Chief Justice of Nigeria (CJN), cutting the tape to the Justice Pius Olayiwola Aderemi Pavillion, assisited by Oyo State Deputy Governor during the maiden edition of the HON. JUSTICE PIUS OLAYIWOLA ADEREMI Lecture series.

cause such apology and declaration to be published in each of the forums which have given or could give reason for our complaint (such apology to be approved by us prior to publication); • provide details of the number of online posts made, together with website addresses; • make proposals for the payment to us of damages for the harm caused www.businessday.ng

to our reputation; and • undertake to actively monitor and delete any newly published defamatory content relating to the Firm.

If the defamatory Publication and threads are not permanently removed and the above undertakings are not complied within the stipulated period, SimmonsCooper Partners reserves the right to undertake further action as appropriate”.

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hree London City firms have begun piloting artificial intelligence technology that drafts contract clauses, the system’s developer said today as it announced financial backing of over £2m. Genie AI claims to apply ‘deep learning’ techniques in software that trains itself to recommend clauses by examining thousands of past transactions and negotiations.

Magic circle firm Clifford Chance and international firms Pinsent Masons and Withers are piloting the technology. While several lawtech innovators have applied machine learning to contract review and due diligence, Genie AI says its SuperDrafter does not require training by humans but can learn by itself.

The result ‘can not just extract but actually recommend legal language specific to each matter’, co-founder Rafie Faruq said.

The technology spun out of research on generative algorithms at University College London. Firms piloting the system said that, if it lives up to its promise, it will be @Businessdayng

a step forward in artificial intelligence - but that it will complement, not replace, human lawyers.

Dr Phil Lindan, innovation manager at Withers, said the system would provide ‘fully curated expertise’ on tap as lawyers assemble documents. ‘That kind of augmented capability, an algorithmic expert sitting by your side, is the future for law and many professions,’ he said.

Pinsent Masons is testing the system in its UK banking team.

Lucy Shurwood, partner, said the firm has been working on AI for contract reviews for seven years, but mainly as a way of analysing the content of contracts. ‘At present, AI tools for document review focus primarily on identifying, extracting and classifying relevant data from legal documents - assessment is still largely undertaken by lawyers.

We see assessment as the next big step in AI contract review.’

Genie AI said it had received seed funding of £1.2m from backers including venture capital firm Connect Ventures. It has also received £800,000 in government funding from UK Research and Innovation, partly to investigate ways of maintaining confidentiality in material used to train machine learning systems. This has emerged as a significant problem in applying AI to legal practice.

Culled from the Law Society Gazette

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Thursday 25 July 2019

BUSINESS DAY

Corporate Social Impact

Onuwa Lucky Joseph (08023314782) Editor.

Sustainability experts, others, engage youths at Sustainable Solutions Africa conference Stories by ONUWA LUCKY JOSEPH

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n commemoration of the United Nations’ World Youth Skills Day, WeForGood International, in partnership with IHS Nigeria, hosted leading experts and entrepreneurs at the Sustainable Solutions Africa Conference which took place on Monday 15th July, 2019 at Four Points by Sheraton Hotel, Victoria Island, Lagos.

The Conference, which also doubled as the official launch of the Sustainable Solutions Africa 30Under30 project, was aimed at helping young Nigerians to positively view skills differently and to encourage them to explore skillbased opportunities to boost the Nigerian economy.

Speakers, who are leading professionals in their respective fields, stressed the importance of purpose in creating sustainable solutions and gave tips on how to steadily grow an impactful business in two panel discussions.

The speakers include Achenyo Ichadaba-Obaro, Founder Mitimeth; Olutosin Oladosu-Adebowale, Founder Trash To Treasure; Olamide Ayeni, CEO Pearl Recycling; Ayoola Jolayemi, CEO SwiftThink Limited; Mazi Alison Ukonu, Co-Founder Recycle Points; Bruno Oaikhinan, Chief Inspiration Officer Bruno’s Place; Francesca Rosset, Managing

L-R: Senior Manager, Corporate Social Responsibility, IHS Towers, Cima Sholotan; Managing Partner, Kinabuti, Francesca Rosset; Chief Executive Officer, WeForGood International, Temitayo Ade-Peters; Chief Executive Officer, Pearl Recycling, Olamide Ayeni and Founder, MitiMeth, Achenyo Idachaba-Obaro, during the Sustainable Solutions Africa Conference organised by WeForGood International in partnership with IHS Nigeria to commemorate UN World Youth Skills Day in Lagos on July 15, 2019

Partner Kinabuti; and Femi Oye, CEO Green Energy and Biofuels.

Speaking about the Conference in her Welcome Address, Temitayo Ade-Peters, CEO WeForGood International said, “The 2019 Sustainable Solutions Conference has been put together to commemorate the UN World Youth Skills Day. According to the United Nations, young people are almost three times more likely to

be unemployed than adults and they are continuously exposed to lower quality of jobs, greater labour market inequalities, and longer and more insecure schoolto-work transition. This is one reality we cannot continue to allow to play out unchallenged.”

“This has formed the foundation on which WeForGood International has adopted the Sustainable Development Goals (SDGs) as its roadmap for effect-

ing desired changes. By demanding an all-inclusive multifaceted approach, the SDGs provide us with a viable roadmap for tackling identified challenges related to poverty, infrastructure, innovation, and environmental sustainability which are key elements for building a better Africa,” she added.

The enriching Conference, which had over 200 attendees, came to a climax with the official

announcement of the Fellows of the 30Under30Project, a blended fellowship and accelerator that WeForGood International has launched to promote skills for sustainable development, specifically for reducing unemployment on the continent, starting with Nigeria.

The Sustainable Solutions Africa Conference was put together with the partnership of IHS Nigeria, as well as the support of the Lagos State Employment Trust Fund (LSETF), Guardian Angels, Kinabuti and Mitimeth.

About WeForGood International WeForGood International is a sustainable development consulting firm that focuses on communications, training and programmes that target the fulfilment of the SDGs, with the overall mission to champion the emergence of a new crop of African leaders who are committed to its sustainable development.

The company supports organisations in their journey towards purpose and profit, from strategy to execution. Its training and coaching arm focuses on helping young people and professionals gain the right leadership skills to create sustainable value in competitive landscapes.

Weforgood.org, its online community, brings people and organisations together to act on causes they care about.

Otedola Extends Lifeline to Sadiq Daba Sahara Group sponsors private screening of Bling Lagosians

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n further affirming its support for the arts as a vehicle for promoting sustainable development, Sahara Group, which had collaborated with Kunle Afolayan and the Grooming Films Extrapreneurs project to sponsor budding filmmakers to the London Film Academy, helped sponsor the private screening of ‘The Bling Lagosians’.

Bethel Obioma, Sahara Group head of corporate communications, said at the event, that his company “believes in the transforming power of the written word, photography, film, music, drama, and other forms of art”, adding that the company’s “commitment remained unwavering through various interventions and partnerships.”

As the title suggests the film is about an ingrained obsessive love for the social circuit and the financial ruination that can be the eventual outcome.

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he internet was abuzz early this week about Otedola’s holiday in Monaco with the kids, and how they jetted into Italy for one hour just to buy ice cream.

It made a whole lot of people imagine themselves living the life of the rich and famous. For the vast majority of humanity it’s a wish that will never come true.

But live it vicariously, we do; and copiously too.

The good thing is that the good life is not all there is to Femi Otedola. As is becoming his custom, he has extended a helping hand to another man who’s in dire need of one. Sadiq Daba who made his name in Cockcrow at Dawn, the NTA series that a lot of middle age and older Nigerians were weaned on. Sadiq Daba, (Bitrus on the show) was the star.

It had a retinue of other accomplished, but upcoming at the time, artists like Ene Oloja (Zemaye), the late Kasimu Yero (Uncle Gaga), the late George Menta, the late Tola Awobode (Lare), Zainab Bewell (Ene), Lantana Ahmed (Afi), Emmanuel Oniwun (Uncle Beke), and Maureen Egbuna. It was directed by www.businessday.ng

Femi Otedola

Sadiq Daba

the late Matt Dadzie and produced by the redoubtable Peter Igho. The mellifluous voice in the soundtrack belonged to none other than Bongos Ikwue.

I did the little recap just to give an idea (especially to younger readers) how influential the series was as an entertainment vehicle back in those days. Thankfully, Femi Otedola is also of the same mind that people who gave so much for almost free, yes, for almost free, should not end up penurious and abandoned by those to whom they gave so much joy. His statement, which we reproduce hereunder, drips

with concern.

“I heard about Mr. Sadiq Daba’s health condition when it was brought to my attention through an online news story I read two days ago,” he said.

“I was saddened to hear that he had taken ill again after overcoming his challenges from prostate cancer just two years ago.

“From the news report, I gathered that he was rushed to the Emergency Unit of LUTH after being diagnosed with chronic obstructive pulmonary disease (COPD).

“I must say that even though I don’t know Mr. Daba person-

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@Businessdayng

ally, he is a face I am familiar with through the old TV drama production ‘Cock Crow at Dawn’ which I used to watch while growing up.

“I was moved by a sense of nostalgia and concern when I read of his medical situation recently and decided to take over his medical bills. He has been visited and arrangements are being made to support him.

“In other climes, the likes of Sadiq Daba and other such actors who more or less paved the way for the entertainment industry and the Nollywood industry in Nigeria (which is touted as the 3rd largest movie industry in the world) would be celebrated as Icons and due recognition would be accorded to them.

“For me, taking care of Sadiq’s medical expenses is my little way of showing appreciation and gratitude for the good memories he created for me and others in the past.”

Hi other high profile interventions include footing the bill for veteran actor Victor Olaotan, and recently, for Chairman Christian Chukwu. Applause, applause!

Thursday 25 July 2019

BUSINESS DAY

33

cityfile Slain DELSU student: Defence counsel’s absence stalls trial again Mercy Enoch, Asaba

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L-R: Taofik Olabode, consultant (Obstetrics and Gynecology), Randle General Hospital, maternal and child centre, Gbaja, Surulere; Grace Udensi, Public Affairs Manager (Lagos), Nigerian Breweries Plc.; Samson Oguntobi, head of radiology, Randle General Hospital, Surulere; Sade Morgan, corporate affairs director, Nigerian Breweries Plc.; Oluwatosin Adekoya, head of nursing department, Randle General Hospital, maternal and child centre, Gbaja, Surulere, and Fakoya Oyewale, brewery medical doctor (Lagos and Ota), Nigerian Breweries Plc., during the presentation of Obstetrics and Gynecology Ultra-Scan Machine donated by the Heineken Africa Foundation to Randle General Hospital, Maternal and Child Centre, Gbaja, Surulere, Lagos recently.

A/Ibom rejects controversial hospital equipment ANIEFIOK UDONQUAK, Uyo

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kwa Ibom government has rejected the controversial hospital equipment said to have been donated to a cottage hospital in Awa, Onna local government area of the State.

Dominic Ukpong, commissioner for health, who made this known while inspecting the equipment, said it was wrong for “anybody or philanthropist to have made the donation without following laid down rules and procedures.

It was gathered that the

equipment were dumped in the cottage hospital by unknown persons.

Last week, the Independent Corrupt Practices Commission (ICPC) allegedly recovered some hospital equipment in a warehouse in Ukana, Essien Udim local government area of the state.

According to the commission, the hospital equipment were part of a constituency project allegedly undertaken by former senate minority leader, Godswill Akpabio but were never delivered to the hospital.

Ukpong, who confirmed that the equipment “were brought in last Wednesday

without the knowledge of the medical superintendent” said the state government has decided to set up a committee to investigate the matter.

“We started the rehabilitation of this hospital last year and we are almost about to commission it. And all the equipment for the hospital are stocked in the warehouse. We expect that anybody who wants to assist us should ask of areas of our needs to avoid deplication.

“We have three trailer and a bus load of equipment we have yet to ascertain the name of the contractor but fortunately we have the

name of the man who was in charge of the equipment.

We shall ascertain from him of the contractor and the person behind it” “What we have seen it is not what we planned for in this hospital, for instance, the manual beds, the state government has brought in automated beds in line with what is in place in other hospitals across the state.

Oba Alexius, an official of the ICPC, who also visited the hospital, said he was directed to ascertain the type of the equipment, who brought them and where the equipment came from.

Kogi: Police nab 36 suspects for kidnapping, armed robbery VICTORIA NNAKAIKE, Lokoja

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he police in Kogi in the effort to rid the state of crime and criminality, have paraded 36 persons for alleged kidnapping, armed robbery, culpable homicide, cultism as well as those in possession of substance believed to be Indian hemp.

Parading the suspected cr iminals at the police headquarters in Lokoja o n Tu e s d ay , t h e C o m missioner of Police (CP) in the state, Hakeem Busari linked the success

recorded to what he called ‘c o m p r e h e n s i v e c r i m e prevention and control strategies’ adopted by Operation Puff Adder.

The strategies, he said, i nv o l v e d i nt e n s i v e p a trols, raids on identified criminal hideouts and flashpoints as well as stop-and-search across the state.

He said the effort led to the arrest of many suspected criminal elements that have been terrorising the residents of the state.

According to Basuri, the commitment of the command to sustain the www.businessday.ng

tempo of the fight against criminality in the state a n d g u a ra n t e e p ro t e ction of lives and property w o u l d n o t b e c o m p ro mised.

The police chief further stated that following a report from one Blessing Ogbu about the kidnapping of her husband, Uchenna Ogbu, a businessman that sells cows and the demand of N10 million ransom from the kidnappers, security operatives swung into action a n d a r re s t e d o n e Jo h n Okonkwo and further investigation led to the ar-

rest of other suspects, Suleiman Usman, Abubakar Usman, Aliyu Abdullahi, Kayode Oloruntoba and Rufus Kayode Others are Christopher Attah, Anna who reported to the command that his boss, Yahaya Jibrin was mu rd e re d by u n k n ow n p e r s o n s. O n i nve s t iga tion, Abdul Abu, a motorcycle rider was arrested, who confessed that Christopher Attah contacted him and two others to rob his boss and collected the sum of N 1.6 million from him and later killed him.

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urther trial of the four defendants, who allegedly murdered Elohozino Ogege, a 300 level Mass Communication student of the Delta State University (DELSU), Abraka, in November 2018, was again stalled on Tuesday, July 23 2019, at the resumed hearing at Asaba High Court 4 due to the absence of counsel to 1st, 2nd and 4th defendants.

At resumed hearing, S.C. Okehiliem, counsel to the 1st and 2nd defendants (Macaulay Desmond Oghenemaro and Ojokojo Robinson Obajero) and B.O. Okoh of the Legal Aid Council, counsel to the 4th defendant (Enaike Onoriode) were absent from court.

This was the second time the trial would be stalled due to the absence of counsels to some of the defendants.

It would be recalled that the trial of the four defendants was stalled on May 21, 2019 due to the absence of counsel to the 4th defendant, B.O. Okoh of the Legal Aid Council.

Prosecuting counsel from the state ministry of justice, Omamuzo Erebe, director of legal drafting, who led P.U. Akamagwuna had informed the court that it had its 4th witness in court but could not proceed in view of the non-appearance of counsel to the 1st, 2nd and 4th defendants.

However, the counsel to the 3rd defendant, Olusegun Ajayi, was present in court.

The trial judge, Flora Ngozi Azinge in her ruling, ordered that hearing notices be served personally on the two counsels while the case was subsequently adjourned to Monday July 29, 2019 for further hearing.

Meanwhile, the remains of Elohozino Ogege were on Friday, July 19, 2019 finally laid to rest at Oleh, headquarters of Isoko South local government area amidst tears.

The four defendants, Macaulay Desmond Oghenemaro, Ojokojo Robinson Obajero, Nwosisi Benedict Uche and Enaike Onoriode had pleaded not guilty to the eight-count charge preferred against them by the state for the alleged murder of Elohozino Ogege.

Zamfara seeks FG’s intervention in resettling IDPs

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amfara State government has sought the Federal Government’s involvement in the effort to resettle Internally Displaced Persons (IDPs) occasioned lingering violence in the North-Western state.

Security reports indicate that there are more than 30,000 IDPs, forced out of their communities by bandits that have persistently attacked the rural areas.

Officials of the state have said that most of the displaced persons were women and children, with many of them living in schools, uncompleted buildings, and along the streets.

According to Governor Bello Matawalle, the state government has lodged a formal complaint to the National Emergency Management Agency (NEMA), in Abuja over the condition of the IDPs. The governor through his aide, Yusuf Idris, said in Gusau that the IDPs were in dire need of support.

“We want urgent intervention from the Federal @Businessdayng

Government; it could be in the form of provision of agricultural inputs, food, medicines, shelter and animals feeds.

“We are forced to seek this assistance because the state government alone cannot shoulder the responsibilities considering the magnitude of damage caused by the crisis.”

He said that security challenges which have left the state devastated, especially in the area of economic development, needed special interventions from all stakeholders.

“Immediately after my assumption of office as governor of this state, we initiated peace dialogue for warring parties as part of effort to address the challenges.

“We thank God that relative peace is returning to the state, but the greatest burden on the government is how to create enabling environment for economic transformation of the IDPs and repentant bandits, who accepted to lay down their arms,” lamented Matawalle

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Thursday 25 July 2019

BUSINESS DAY

TECHTALK Innovation

Apps

Fin-Tech

Start-up

Gadgets

Ecommerce

IOTs

Broadband Infrastructure

Bank IT Security

Isa Pantami: Nigeria’s next ICT Minister? nical Writing in 2014. He made professor in Madinah where he lectured in the new Faculty of Computing and Information Systemsof the university.

In 2016, he was confirmed by President Buhari as part of the 13 newly appointed chief executive officers for 13 government agencies. His directive for NITDA upon employment was to develop the ICT infrastructure in the North East.

Stories by FRANK ELEANYA

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any stakeholders in Nigeria’s ICT sector can now heave a sigh of relief as the name of former minister of ICT; Adebayo Shittu was conspicuously missing from the ministerial list released on Tuesday.

President Muhammadu Buhari finally transmitted the list of his nominees to the senate for confirmation, with only twelve members of the old cabinet returning to the country’s service.

Of particular interest for the tech ecosystem and ICT industry was the position of the minister in the ministry. The previous occupant of that position, Adebayo Shittu, according to many stakeholders, left little to be desired. Many had seen the appointment of the minister as a mere compensation for his role in the election of President Buhari, in which the president’s party won in Oyo state where the former minister comes from.

But if his appointment was a concern, his four years stewardship as minister of ICT was seen as a big disappointment and riddled with many controversies.

While his omission from

Isa Pantami

the list may significantly have to do with his poor record in office, his unabashed political pursuit which saw him falling out many times with the leadership of the party at the national level and consequently contributing to APC’s loss to PDP in the state may have been the last straw.

In any case, with Shittu out of the picture, the attention in the coming days would likely turn to the inclusion of Ali Isa Pantami,

current director general and CEO of National Information Technology Development Agency (NITDA), on the list. Being the only nominee with a significant ICT experience and background it is to be expected that the President will hand the ministry over to him.

The ministry of information and communication technology (ICT), created in 2011, has five agencies including, Nigeria Communications Commission (NCC); NITDA; NIPOST;

NigComSat and Galaxy Backbone.

NITDA is the agency that implements the ICT policy of the ministry of communication. It has the sole responsibility of developing programs that caters for the running of ICT related activities in Nigeria.

It is also mandated with the implementation of policies guidelines for driving ICT in Nigeria.

NITDA’s strategic position in the ministry, should give the current DG a better per-

spective to manage its affairs.

Who is Isa Pantami?

Isa Ali Pantami is a 47 year old graduate of Computer Science and PhD holder in Computer Information System from the Robert Gordon University of Aberdeen, Scotland, United Kingdom.

Before his appointment in NITDAY, Pantami lectured at Abubakar Tafawa Balewa University in Information Technology and later joined the Islamic University of Madinah as head of Tech-

Alleged EFCC investigation Despite his very glossy ICT resume, Pantami’s stewardship as DG of NITDA has had some snags. For instance, in 2017 the former minister of ICT, Adebayo Shittu, was reported to have alleged in a radio programme in Ibadan that Pantami was being investigated by the Economic and Financial Crimes Commission (EFCC) over award of contracts at the agency.

The allegation was originally made by Kadunabased Good Governance and Accountability Monitoring Group. According to the group, Pantami did not follow due process of the Procurement Act in awarding a Galaxy Backbone contract.

NITDA however denied it was under investigation by the EFCC.

How we blocked 6.9m cyber threats in 2018 – Trend Micro boss

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rend Micro, a global cyber security and defence company, with offices in more than 50 countries, said it helped organisations and government institutions to detect and ward off 6.9 million cyber threats in 2018.

The company’s vice president, sub-Saharan African region, Indi Siriniwasa disclosed this at recent a partner meeting in Lagos, Nigeria. The company unveiled its new channel partner programme for sub-Saharan Africa region during the meeting.

According to him, cyber threats to businesses are

becoming widespread as hackers are exploring loopholes in justice system to grow their confidence.

“It is a big business,” he said during an interview with reporters. “It is much easier to hack organisations and steal money than breaking an ATM machine.

An ATM machine can bring publicity and probably get the police involved. But if you are good hacker, you can hack an organisation and steal money and get away with it. The legal system is still far behind in terms of the hacker community.”

He noted that the evolving tactics of hackers calls for organisations to always

stay alert and ensure that their digital assets are protected round the clock. This is more important now that data has become the digital oil and any hacker will do everything to get their hands on sensitive information belonging to organisations and customers.

Trend Micro has been the world’s leading hybrid cloud security provider for the past eight years in a row.

Siriniwasa said it is due to commitment to stay ahead of the trends and anticipate every potential cyber security threat.

“20 years back cyber security was the IT guys’ problem. It is not IT any more, the CEOs have a big

role to play no. when a firm in South Africa was hacked, the CEO had to come and apologise to the customers.

Everyone is responsible it is not about IT anymore.

It is about responsibility to protect the information and their customers,” he said.

To be sure, hybrid cloud is a cloud computing environment that uses a mix of on-premises, private cloud and third-party, public cloud services with orchestration between the two platforms. On the security side, the VP explained that, Trend Micro provides different security strategies for the various components of data storage. This is even more im-

portant for organisations where there are various classifications of information such as highly sensitive data and public data.

These may require different protections plans.

Siriniwasa disclosed that it was increasing its investment in West Africa following the growth of channel ecosystem in the past two years. The channel programme, among other benefits, has seen significant improvement in knowledge of the cloud leading to more customer adoption.

The programme was designed to assist existing partners to grow their business and pave way for new partners to get

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

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onboarded with as few roadblocks as possible; delivering everything needed to quickly get up to speed, close new business, and ensure success. Following a tiered approach, the programme is made up of bronze, silver, gold and platinum partners with varying benefits based on the sales and technical competencies of partners.

“We believe that with our reenergised channel programme we can fast track the development of our partners and ensure they meet the ever-changing security demands of an industry bombarded by disruptive technologies,” Siriniwasa said.

Thursday 25 July 2019

BUSINESS DAY

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Thursday 25 July 2019

BUSINESS DAY

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Thursday 25 July 2019

BUSINESS DAY

37

MADE in aba

Boundless potential shows why Nigeria must take Aba seriously Joseph Maurice Ogu

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ba is China of Africa”, echoed Dim Chigozie, chief executive of Prince D i m Fa s h i o n Concept, Aba, Abia State. “But there is no infrastructure in Aba to support our business,” he lamented over the telephone conversation with BusinessDay. The city is one of Africa’s industrial hubs. Like Chigozie, many SME operators in Aba wonder why federal and state governments neglect the potential of the city, thereby making China a viable alternative.

If necessary attention is paid to Aba, Chigozie said, the production capacity of the hub will increase the economy of the nation.

Aba industrial hub faces several challenges that affect the manufacturers. According to Chigozie, whose office is located at Mbaise/Ngwa Road, Aba, the road network in the area is terrible, blaming the state government for not paying enough attention to a place that could turn the economy of Nigeria around for good.

In addition, power supply is another major issue that Aba industrialists have to contend with.

As sources of alternative power supply, Aba industrialists have to go for generating sets to keep their productions going. This means that people like Chigozie usually buy petrol/diesel to power their generating sets.

This raises production costs and reduces competitiveness

of their products.

“I buy fuel every day. It tells a lot in my pocket,” he lamented.

John Chinedu, a shoemaker in Aba, said most of his income goes to power generation by way of fueling his generators.

“If I do not power my generator, I will go out of business,” he said.

Acquiring the necessary equipment is another challenge of people like Chigozie, who have the technical knowledge to sew different types of clothes but do not have the financial strength to acquire some machines, especially for finishing, face.

“What you see in China is nothing; they only have the equipment,” Chigozie said.

According to him, even with the little equipment they have, Aba producers are able to come out with products that are globally demanded, wondering what they could achieve if the right pieces of equipment are at their reach.

His main challenge is to acquire ‘finishing machines’ that will enable his handiwork become more visible and appreciated.

“People who travel to China mainly go there because China has finishing machines, nothing else. If such machines are available in Nigeria, Aba will compete with China,” he said.

“The main thing about the job is finishing. If we have the equipment, people will no longer go to China,” he boasted.

Chijioke Oguebunwa, an Aba based entrepreneur, said a lot of products come out from Aba, adding that government only needs to do more for the

city to make it what is should be.

There is nothing that is needed that one could not get in Aba, ranging from shoes, cloths, belts and other things, he said.

“It is in Aba they sew most of things you see in Nigeria,” said Oguebunwa.

Debunking the myth that Aba produces fake product which makes consumers prefer foreign products, Chigozie said Aba’s operation is similar

to what happens in China.

In the chain of distribution, the wholesalers usually prescribe to manufactures in Aba the specifications to be produced for them, the grade from highest quality to lowest quality. “ This is also what is obtainable in China,” Chigozie compared.

Surprisingly, according to Chigozie, some of the products sold in Italy, America, Dubai and other countries are being

produced in Aba. Exporters usually go to Aba, demand for high quality specifications and then export such to foreign countries for sale.

Unknowingly for some Nigerians, they travel to these countries for shopping only to buy the same ‘made in Aba’ they run away from here in Nigeria.

“We usually experience such cases always,” he said.

Chinedu said government needs to enlighten Nigerians more on the need to buy Aba

products, saying Aba produces good quality.

Aba can handle wears that are available in China and elsewhere, he stated.

“Ab a i s nu m b e r o n e producer in West Africa,” Chigozie said.

He bragged that NYSC uniform is being sewn in Aba today, likewise military shoes.

“Aba is just like China. Show us the sample, we will do it for you,” Chinedu concluded.

is made up of shoes, trunk boxes and belts. It provides employment for tens of thousands, with many specialising in different stages such as designing, patterning, cutting, skiving, stitching, peeling and finishing. It is made up of clusters such as Powerline,

Imo Avenue, Bakassi, Aba North Shoe Plaza, Omemma Traders and Workers, ATE Bag, and Ochendo Industrial Market, comprising input supplers, among others.

However, the industry is in thriving in chaos as the majority of shoe makers in the industrial city are

poorly structured and are not registered at the Corporate Affairs Commission. Exports are made informally, making tracking and planning difficult.

Their machines are crude and much of their work is still done by human labour.

Some of their designs are not in tune with current trends.

“This is where the problem lies. We in Aba have no good machines,” Anyanwu of ALAIN said.

He said this is why the majority of Aba shoe makers are not meeting demands and are overworking themselves once orders are placed.

“It is a problem already for us because if a customer comes and we can’t meet demand, he will go elsewhere. The industr y needs retooling,” he said.

Aba shoe makers import animal skins from China and many parts of Africa and

Europe.

“What happens is that the tanneries in Kano and Kaduna process animal skins and sell them as leather in the global market, earning foreign exchange,” said Chinatu Nwagbara, coordinator of Made-in-Aba Project, who produced shoes for Olusegun Obasanjo in 2016.

“So we go to China and other countr ies to buy.

Sometimes, we buy our products and re-import,” he said.

More leather investments are going to Ethiopia.

Between October and December 2016, Ethiopia attracted over $500 million in FDI to the shoe and leather industry. About 124 investors willing to invest $3.5 billion indicated interest to swell the export-oriented shoe market, according to the Ethiopian Investment Commission (EIC).

Why Aba leather industry matters ODINAKA ANUDU

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he Aba shoe industry is important for creating jobs and growing the gross domestic product (GDP. S u c h b u s i n e s s e s a re responsible for creating 59.647 million jobs in t h e Ni g e r i a n e c o n o my , contributing 50 percent to the GDP and 7.64 percent to export receipts, according to a recent report by the National Bureau of Statistics (NBS) and the Small and Medium Enterprises Development Agenc y of Nigeria (SMEDAN).

Many Nigerians underestimate the potential of the Aba industry. One million pairs of shoes are produced by more than 80,000 leather makers in Aba each week. With 48 million pairs produced each year at an average price of

N2,500 a pair, the industry is said to be worth up to N120 billion.

T r a d e r s f r o m We s t African neighbours storm the industrial city every week to buy different product designs, just as Southern African schools a re b e g i n n i ng t o p l a c e orders directly from the shoe makers. Canadians, Europeans and the Chinese are also in the party, placing orders themselves directly or through their Nigerian proxies, BusinessDay was told in Aba. “We are already struggling to meet demands,” said Ken Anyanwu, secretary of the Association of Leather and Allied Industrialists of Nigeria (AL AN), who produced Nigerian armed forces shoes in 2016.

The business is going d ig i t a l , w i t h sa l e s n ow online.

The Aba leather industry www.businessday.ng

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Thursday 25 July 2019

BUSINESS DAY

news How FX restriction of milk will impact Nigerian...

Continued from page 1

from the FX market?

First consider the numbers. Nigeria produces 700,000 metric tons (MT) of dairy products annually but demand stands at 1.3 million MT, according to the Federal Ministry of Agriculture. This means there is a shortfall of 600,000 MT. Secondly, average yield per cow in Nigeria is one litre per day, which is among the lowest in the world.

Other countries have done much better. The average milk yield per day from exotic/crossbred cows in India, United States, the Netherlands, Turkey, China and India is between 30 litres and 90 litres per cow per day, statistics shows.

“You have to do a lot of cross-breeding and artificial insemination to get a lot of milk, and this takes a lot of investments,” an experienced dairy farmer said.

More so, all over the world, dairy farmers build their factories close to sites where they do backward integration. The reason is that raw milk from cows can go sour if located far away from milk collection and processing sites.

“You milk goes sour or perishes after two hours,” an expert in milk processing, who does not want his name on print, said.

“If you have to do backward integration in Jos, your milk processing and collection centres must be in Jos, otherwise you lose ever ything,” the expert said. In Nigeria, Friesland Campina Wamco is the only milk maker with active backward integration projects.

They have such projects in Fasola, Maya, Saki, Iseyin and Akele, all in Oyo State.

Despite this, the company gets far less than 10 percent of their milk needs from hundreds of cows they have owing to issues around low yield, and huge financial requirements.

Bismarck Rewane, CEO Fi na n c i a l D e r i v at i v e s, however, said the process of backward integration requires time and planning to effectively implement.

He noted that the cost of a lactating cow is quite significant and so is the infrastructure to do so and that process of lactation would create a whole new business for milk producers who would have to find use for the by-products from milk.

“Should the importer stay 60 years without do-

ing anything? No. The incentives and packaging should have been done early,” Rewane said. “You have got to give the incentives and time to backward integrate.”

On Tuesday, Emefiele said producing milk is not rocket science. “ Milk production is simply about getting a cow, giving it water and pasture and position the cow in a particular place,” he said, adding that a failed attempt at backward integration in the milk industry has contributed to the herdsmen crisis.

He said the bank met with Wamco, the oldest milk manufacturer in Nigeria and appealed to them to get involved in backward integration and begin the process of milk production in Nigeria.

Expectations of the apex bank was that milk producers would explore options of acquiring land and grazing their own cows, or being complimented with pastoralists who own farms making arrangement to get land from them.

Alternatively, milk producer could mull supporting the pastoralists by keeping them in a place and providing basic necessities for them to survive and in return they get milk for production.

“This is what we expect these companies to do but they have not complied even after three years,” Emefiele said.

However, checks show WAMCO, through its Dairy Development Programme (DDP) started since 2010, empowers about 4,000 farmers.

Analysts believe restricting milk from the FX market may lead to some exits to other African countries in the wake of African Continental Free Trade Area (AfCFTA), job losses, and increased milk smuggling.

They add that the approach of the Central Bank at influencing the country’s real sector might be counterproductive.

“The broader issue is about the shock of policy on investment,” said Muda Yusuf, director general of the Lagos Chamber of Commerce and Industry (LCCI).

“In my view, the cost of policy most of the times outweighs the benefits.

It (CBN regulation) happened in palm oil industry, textile industry and now we are coming to milk.

Who knows where next?” he said.

According to Yusuf, www.businessday.ng

L-R: Segun Apata, chairman, Nigerian Bottling Company Limited (NBC); Laolu Akinkugbe, member, board of directors, NBC; George Polymenakos, managing director, NBC, and Vice President Yemi Osinbajo, during the Board’s visit to the Vice President in Abuja.

US visa restriction on complicit politicians, my vindication..

Continued from page 1

Yinka Odumakin, Publicity Secretary of pan-Yoruba socio-political group, Afenifere, applauded the move. However, Balarabe Musa, former governor of the old Kaduna State, deplored the US action, saying it amounted to interference.

In a message to the media, Wednesday, and signed by his media adviser Paul Ibe, Atiku accused the current administration of deliberate propaganda to cover up the electoral fraud.

The United States, Tuesday, said it had begun moves to place visa restriction on corrupt Nigerians and individuals who acted to undermine Nigeria’s democracy.

The US, however, noted that it was committed to work to advance democracy and respect for human rights in the country, but hinted that it would move against those whose acts of violence, intimidation, or corruption harmed Nigerians or undermined the democratic process in the country.

Several international election observers groups, including the European Union Election Observation Mission (EU EOM) to Nigeria, in their final report on the 2019 general elections concluded that the elections were marked by severe operational and transparency deficiencies, including electoral security problems, low turnout and abuse of incumbency power.

Atiku further urged Nigeri-

ans not to despair, or give up, stressing that he was optimistic that there was hope for the country in which the current socio-economic challenges bedevilling it would be tackled by a purpose driven government.

“In the aftermath of the daylight robbery that occurred on Election Day, the regime of General Muhammadu Buhari and its allies went into a propaganda overdrive to deny the obvious,” Atiku said.

“However, it is a truism that no matter how far and fast falsehood, or in this case, rigging, has travelled, it must eventually be overtaken by truth. It seems that day has come. After many months of living in denial, the Buhari regime is now faced with the truth in the form of a US visa ban on politicians who undermined Nigeria’s democracy,” he said.

Atiku, former Vice President under the Olusegun Obasanjo, further thanked the United States of America for standing with the Nigerian people against individuals who desired to truncate the nation’s democracy.

“The myriad of security, economic and social challenges Nigeria currently faces, which has resulted in our nation becoming the world headquarters for extreme poverty will, God willing, soon be over, with the prospect of purposeful and result oriented leadership,” he said.

However, some political leaders who spoke in separate interviews with BusinessDay

Wednesday expressed mix reactions over the visa restriction on some politicians.

Second-republic governor of old Kaduna State, Balarabe Musa, disagreed with the policy, noting that it amounted to unnecessary interference in the affairs of the country.

“Such interfering in the affairs of Nigeria is not necessary. Personally, I do not understand such policy, it is unnecessary at this point,” he said by phone from Kaduna Wednesday.

Former Minister, Ebenezer Babatope, however, applauded the US decision, noting that the United States had the powers to take such a stand, and that it would serve as deterrent to others “Such a move should be applauded. The US is free to take its stand on the Nigeria general elections. We know the way the election went; it was widely manipulated.

Yinka Odumakin, Publicity Secretary of pan-Yoruba socio-political group, Afenifere, agrees, saying the United States’ decision was commendable. He urged other nations across the world to make their positions on the election known.

“I am happy to know their stand. This would serves as deterrent for other Nigerians to know that they can’t do anything and get away with it,” Odumakin said.

“We remember before the election, a governor said that observers that came into Nigeria would go back in body bags.

What do you expect when a

multidisciplinary panel of $4m investment for robotic surgery centre ... aLokmanaya Orthopedics and Continued from page 2 Outpatient surgical treatments, follow up care and rehabilitation will be offered at the soon to be launched program under the 5 year program with a vision to establish the first In-patient Robotic joint replacement program in Nigeria.

To this end, a selected Lokmanya Orthopedic Doctors and Managers will join the Nigerian

team to provide three other services. Firstly, Teleradiology & Teleconsultation, which allows physicians to connect electronically and directly with Lokmanya specialists for 2nd opinion and additional input on a patient’s care.

The second is International Conferences and Grand Rounds, which will enable physicians to present and discuss management of complex patient cases with

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specialists and other international experts.

The third is international management. A dedicated international manger which has been appointed will enable Kasi Healthcare implement Lokmanya clinical, operational and business models, including design and implementation, to meet each organization’s clinical, operational and business objectives “Our Executive teams at @Businessdayng

government openly says that,” he said.

Atiku is currently challenging the result of the presidential election at the tribunal. Political stakeholders have equally advocated for serious electoral reforms in the country, due to the systemic failings and low level of voter participation recorded during the 2019 polls.

Meanwhile the Buhari Media Organisation (BMO) said it is instructive that the United States is taking the step in spite of efforts by opposition figures led by the Presidential candidate of the People’s Democratic Party (PDP) Atiku Abubakar, to turn the US government against the newly elected government with false narratives.

BMO said in a statement signed by its Chairman Niyi Akinsiju and Secretary Cassidy Madueke, that the US State Department’s position showed the futility of the opposition’s efforts to demonise the government before, during and after the 2019 elections.

“We acknowledge the decision by the American government to impose visa ban on individuals responsible for undermining the last electoral process or organising electionrelated violence. It is in line with a warning the US issued before the election, and we note that it is within the rights of the Americans to do so.

“And by making it clear that the actions are not directed at the government that emerged from the process, the US has tacitly cleared the Buhari administration of involvement in acts of political violence inspite of efforts by lobbyists engaged by the PDP to taint the President’s victory.” both Kasi Orthopedics and Lokmanya Orthopedics have spent close to a year evaluating the opportunity for our partnership with many business trips and conference calls between Lagos and Pune. Both organisations share a philosophy, commitment and mission to improve the delivery of health care through high-technology, top-doctors and a human touch that does more for Nigerians as is the vision of Kasi healthcare” said Capt. Hemant Kulkarni Vice President Lokmanya Hospitals Pvt. Ltd.

Thursday 25 July 2019

BUSINESS DAY

news

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WACT $10m investment in harbour crane brings Onne at par with Lagos ports ... in line with FG’s plans to decongest Lagos AMAKA ANAGOR-EWUZIE in Onne

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ith $10 million investment in the acquisition of mobile harbour crane, the West Africa Container Terminal(WACT)NigeriaLimited has now positioned to compete favourable with the two major economic gateways in Lagos, Apapa and Tin-Can Island ports.

Thisinvestment,industrystakeholderssay,isinlinewiththeFederal Government plans to decongest LagosportsbymakingEasternPorts viable for shipping lines.

Speaking at the commissioning of the harbour cranes in Onne,RiversStateonWednesday, AamirMirza,managingdirectorof WACT, said the investment at the terminal had attracted 700 direct and 2000 indirect employment in the country.

Mirza said the company had recorded tremendous growth of 17 percent in 2017, 21 percent growth in 2018 and 20 percent growth attained so far this year.

He described the $10 million investment as a key enabler to customers’ satisfaction, saying, “Our vision is to become the best performing container terminal in West Africa. We believe this vision can be realised early enough if the government can support by reducing the challenges of ensuring safety of vessels on our waters, improving road connectivity and among others.”

He said the cranes would enable volume growth resulting in increased productivity; reduce cargodwelltime;improvereliability in cargo delivery times; reduce the impact of crane break down/ idle time on overall terminal operations;increasecustomerssatisfaction and speedy cargo delivery.

Hadiza Bala Usman, managing director, Nigerian Ports Au-

thority (NPA), who commended the company for the developing the terminal in line with international standards, urged shippers to patronise Onne Port.

Represented by Al-Hassan Ismail, port manager, Usman said the government was looking into the security of vessels on the nation’shighsea,andpledgedthat the NPA would continue to sweep the channel to aid navigation into the port.

“The Onne Port is a nexus to connecting the North-East, North-Central, South-South and South-East, so cargoes for this section of the country is expected tobedischargedthroughthisport.

“We are calling on shippers to patronize Onne Port because of the friendly environment, and the synergy between the agencies of government operating at the port,” she said.

Hassan Bello, executive secretary, Nigeria Shippers Council (NSC), said the new facility would aid the efficiency and improve the dwell time of cargoes.

He reiterated the government’s commitment to encourage more importers to patronise OnnePort,sayingthegovernment is determined in seeing shipping contributes to the economy.

“Our terminals need to grow and show efficiency, I am happy with the competition because this will bring in the port industry.

Our importers need options and choice to shippers where they will commission their cargoes.

The commissioning of these mobiles harbour cranes is no doubt significant because that goes to efficiency. We are happy with the increase in volume and that more Nigerians are going to be employed to enable the terminal to contribute to the economy,” he said.

AIG names winners for its Masters...

Continued from front page

public sector.

After their study at Oxford, AIG Scholars are then expected to return to their home country and apply their learning experience as change agents in their country’s public sector.

The2019/2020AIGScholarship recipients are Babafemi Adebola (Nigeria),Onyekachukwu Erobu (Nigeria), Nasir Mohammed (Nigeria) Kwame Sarpong (Ghana) and Hakeem Onasanya (Nigeria).

“I am very impressed with our third cohort of AIG Scholars”, said Aigboje Aig-Imoukhuede, founder/chairman of Africa Initiative for Governance. ”All five of them represent West Africans of great potential. Three qualities are common to all of them - strong intellectual ability, leadership and a passion for public service. It takes a strong value-system to want to servethepublicgoodandthesefive individuals have demonstrated a compelling desire to do so”.

In June 2016, AIG signed a five-year partnership with the Blavatnik School of Government at the University of Oxford, based on a shared vision of improving the world through good governance and public leadership.

In each year of the partnership, AIG makes available five full Scholarships for graduate study at the University of Oxford.

“AIG Scholars are selected through a rigorous, transparent

and merit-based process”, said Chienye Ogwo, CEO of AIG. “Through this process, AIG seeks to encourage the same values in the next generation of public service leaders. With a third round of Scholars, we are honoured to contribute to the development of talent critical to support Africa’s future”.

“I felt an overwhelming sense of joy and relief to have met the exceptionally high standards set

by AIG for the prestigious Scholarship”, said Mr. Nasir Mohammed, a Mechanical Engineering graduate of King’s College, London and one of the recipients of the 2019 AIG Scholarships.

“Being selected as an AIG Scholar is a vote of confidence in my latent abilities which I intend to nurture during my time at the Blavatnik School, in preparation for my contribution to public service. I intend to use this oncein-a-lifetime opportunity to develop myself both personally and professionally.”

“The AIG Scholarship is a stamp of recognition of my academic abilities and leadership potential, which not only humbles me, but also spurs me to do more for the benefit of humanity, “ said Kwame Sarpong, one of the recipients, who holds degrees in Administration and Law. “The desire for public service has burned within me for as long as I can remember. www.businessday.ng

L-R:Okaima Ohizua, executive director, customer services, Transcorp Hotels plc; Valentine Ozigbo, president/CEO, Transcorp plc; Chris O. Okonkwo, president and chairman of IoD; Owen Omogiafo, MD/CEO, Transcorp Hotels plc, and Dele Alimi, director-general/CEO, IoD, at the July 2019 New Members’ Induction ceremony of the Institute of Directors Nigeria held in Abuja, recently

FG to amend Marriage Act to address inconsistencies in certificate issuance Stella Enenche, Abuja

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he Federal Government has announced plans to amend the existing Marriage Act in an effort to sanitise the process of issuing marriage certificates in the country, to meet the 21st Century requirements.

Permanent Secretary, Ministry of Interior, Georgina Ehuriah, made the disclosure on Wednesday in Abuja at the opening of a stakeholders’ conference on conduct of statutory marriage.

AccordingtoEhuriah,only4,689 licensedplacesofworshiphadsofar updated their records with the federal government, adding that only 314 of that number have renewed their licenses to conduct statutory marriages.

Consequently, the permanent

secretary has called on the affected organisations to do the appropriate thing, saying the ministry was set to advisetheministryofForeignAffairs on the appropriate actions to take regarding certificates tendered by citizens intending to travel abroad.

“Movingforward,Ihavealready put in place machinery for the commencement of the process for the amendment of the Marriage Act to adequately meet the needs of citizens in the 21st Century.

“Also, arrangements are ongoing to give couples whose certificateswerenotissuedinlinewiththe Act the opportunity to bring them to conformity.

“As we progress with the sanitization of the process, the Ministry intends to appropriately advise the Ministry of Foreign Affairs on the legally acceptable Certificate for

AirPeace says its airplanes are airworthy, suspects’ pilot error

… Med-View aircraft makes emergency landing … AIB commences investigations

IFEOMA OKEKE

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irPeace, Nigeria’s largest carrier, says the incident that happened on Tuesday, July 23, where it aircraft made an emergency landing at the Murtala Muhammed International Airport, after its nosewheel failed, has nothing to do with the airworthiness of its airplanes.

According to a statement issued by the airline on Wednesday, its preliminary in-house investigation indicates that in a bid to make a positive touchdown as required by procedures during such wet weather operations, the pilot landed the airplane harder than intended which affected the nose-wheel.

“There are no issues with the airworthiness of the aircraft as Air Peace Ltd assures of best maintenance practices at all times and spares no resources to that effect.

“The Management wishes to assure the flying Public that Air Peace Ltd has never stopped appraising its safety practices and procedures as demanded by industry standards,” the airline said.

Tunji Oketunbi, corporate communications manager, Accident Investigation Bureau,

(AIB) said the Bureau is investigating the issue and will come up with preliminary reports soon.

“It is a cumbersome process.

Some components have been retrieved from the airline to help with the investigation. So it will take some time but we are doing everything possible to ensure the report is out sooner than expected,” Oketunbi added.

Similarly, a Boeing 737-500 aircraft operated by Med-View Airline on Tuesday made emergency landing and deployed oxygen mask mid-air.

The AIB, which confirmed the development, said the airline had a serious incident mid-air which caused the crew to deploy oxygen masks and embark on emergency descent procedure.

The Bureau said it has been notified of the incident and has commenced a probe into serious incident.

A statement made available

by Tunji Oketunbi read “The Accident Investigation Bureau, Nigeria has been notified that an aircraft operated by MedView Nigeria Limited, Boeing 737-500 with registration marks 5N-BQM was involved in a serious incident en-route Lagos from Abuja on the 23rd July, 2019 at about 3:07pm local time with 27 passengers and six crewmembers on board. There was no fatality.

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the guidance of foreign embassies in Nigeria and Nigerian Missions abroad,” Ehuriah said.

This was as she disclosed that government was presently building adatabaseofallmarriagesconsummated in the country, with a view to respondingtoenquiriesfromcountries and relevant organisations.

“Presently, only about 4,689 licensedplacesofworshipinNigeria have updated their records with the Ministry of Interior of which only 314 have renewed their licenses to conduct statutory marriages. The implication of this is that marriages conducted in unlicensed places of worship are not in line with the Marriage Act and cannot serve legal purposeswhentheneedarises;and such unlicensed places of worship are operating contrary to Section 6(1) of the Marriage Act.

“Presently, the Ministry is building a data base of all statutory marriages conducted in Nigeria. It has alsodevelopedadatabaseofallplacesofworshiplicensedforcelebration of marriages. This has enabled the Ministry to be in a good position to respond to enquiries from various interested parties from within and outside Nigeria. In addition, the documentationprocessesforlicensing places of worship have been automatedtofacilitatesubmissionof applicationforlicensesbyinterested places of worship,” she said.

She stressed the need for strict compliance with the requirements as specified in the Act by applicants as applications that do not satisfy the law will not be approved. Accordingly, she said, administrators of places of worship are encouraged to satisfy these requirements.

Reps urge NERC to probe Discos, install IPP/NUG in Lagos, Onitsha James Kwen, Abuja

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ouse of Representatives has urged the Nigeria Electricity Regulatory Commission(NERC)toassessthe efficiency of Distribution Companies (Discos) as stipulated in the responsibility of the Commission in order to ameliorate the sufferings of Nigerians.

It asked the power regulator to install Independent Power Producer (IPP)/Non-Utility Generator (NUG) in lIupeju Industrial Hub as it is done in Sura Market in Lagos State, and Onitsha Market in Anambra State, respectively.

The House urged the IKED to overhaul/change outdated and non-functional equipment to justify the billing giving to the people; and mandated its Committee on Power (when constituted) to ensure compliance.

TheHousemadetheseresolutions at Wednesday plenary after a motion on: ‘Urgent Need to Stop Industrial Hub from Collapsing’ sponsored by Ali Taofeek.

Presentingthemotion,Taofeek stated, “The House notes that the administration of President Obasanjo embarked on a series of reforms to revamp the power sector with the enactment of the Electric Power Sector Reform (EPSR) Act, 2005 which led to the handling of National Electric Power Authority (NEPA) to Power Holding Company of Nigeria (PHCN). @Businessdayng

“Also notes that the unbundling was to make electricity generation and supply available to consumers, making the sector investor friendly and dismantle NEPA’smonopolywithTransmission Company of Nigeria (TCN), six electricity generating companies (GENCOS) and eleven Electricity Distribution Companies (DISCOS) as successors during the administration of President Ebele Jonathan.

“Aware that the Act also provided for the establishment of the Nigerian Electricity Regulatory Commission (NERC) which is saddled with the regulation of tariffs and service quality, oversee the activities of the industry for efficiency and other responsibilities which NERC is disinclined to trail.

“Cognizant that the DISCOS have prior knowledge of challenges (grid energy insufficiency and instability, tariff challenges and revenue shortfall, metering challenges, operational challenges, energy theft and network infrastructure challenges) facing PHCN before liquidation.

40 BUSINESS DAY

Thursday 25 July 2019

NEWS

Enyo, Bosch strengthen partnership for automotive parts, services FRANK UZUEGBUNAM

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nyo Retail and Supply, a customer focused, technology driven fuel retailing company, and Bosch, a global supplier of technology and services, have deepened their relationship through the signing of a partnership agreement.

The agreement will entail the operation of Bosch standard centres as you have in Germany, South Africa or anywhere in the world in all Vehicon centres of Enyo throughout Nigeria.

“The partnership is in the early stage but we are now at the stage where it is clear to us that we must deepen the relationship beyond equipment purchase where we get better trained by them. It is a full gamut of services,” says Abayomi Awobokun, Enyo chief executive.

“Bosch is number one globally. We want to be one of the best in the country so our aspirations led us to the best company in the space,” Awobokun says.

Awobokun says the Bosch benchmark Enyo is targeting is not just about “its quality spare parts but trained mechanics, first class centres, great diagnostics and whatever you expect to get anywhere in the world is what we hope to deliver locally and we feel that Bosch is the best partner and teacher. You will get Bosch service quality in all

our locations.

Before now, Bosch have been using export model where local companies from Nigeria deploy their products and services in the market with plans open a full-fledged office in Nigeria with local content and local invoicing in naira by October 2019.

“Nigeria is one of the biggest market with high population in the continent and we want to explore the potentials. We are glad to have Enyo as our local partner.

They have competency and the sites and we bring the technical competency and the spare parts so there is a lot of synergy between Enyo and Bosch,” says Julien Lacoste, regional director, Automotive Aftermarket, West and Central Africa.

The number one manufacturer of automotive parts worldwide and also the largest manufacture of OE systems says they bundle all their spare parts and OE systems in their aftersales services.

“Our deployment come under 3 main pillars; spare parts, workshop equipment and workshop services. Within the scope of workshop services, we have softwares, technical hotlines and technical trainings. This is what we are going to roll out in Nigeria”, says Thomas Winter, president, Automotive Aftermarket, sales workshop concept and services.

Silverbird, BusinessDay, Eventstracer sign MoU to launch Silverbird small business event circuit GBEMI FAMINU

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ilverbird Entertainment in partnership with BusinessDay Newspaper and digital events platform, Eventstracer, have announced plans to launch the Silverbird Small Business Events Circuit.

The Circuit represents what the organisers termed a unique approach to solving the growth and stability challenges faced by small business in Nigeria.

During a media briefing, which also included the signing of the memorandum of understanding (MoU) to announce their collaboration, Guy MurrayBruce, vice president of Silverbird Group, said in addition to finance, creating awareness for their products and services remained a challenge for small business.

“Silverbird is leveraging its

media and real estate assets to create a platform that will provide small businesses with access to providers of what we have termed CHITTA, Capital, Health, Insurance, Technology, Training and Awareness. This CHITTA framework is vital to the sustained growth of small businesses,” according to MurrayBruce.

Commenting on BusinessDay’s participation in the Small Business Circuit initiative, advert general manager, Adeola Ajewole, highlighted the commitment of the newspaper to the growth of small businesses in Nigeria.

Adeola underscored the need to provide subsidised platforms through which small businesses could create awareness and promotion for their products and avoid the huge cost outlays that they presently require to

achieve this.

She expects small businesses to channel the savings from the media subsidy being provided

by Silverbird, BusinessDay and Eventstracer into their other needs, such as working capital.

Also, Adewumi Obakoya, a director at Eventstracer, the official event website partner, said the digital platform would handle all registrations for the Circuit and also serve as a news, data, content development and information platform for activities around the Circuit, its exhibitors and visitors.

The Silverbird Small Business Events Circuit is a series of nine sector specific small business events and seminars organised

by Silverbird Entertainment to promote the stability and growth of SMEs. Each of the events will be held over three days.

The Circuit will begin with

Nigeria’s first ever flower event, the Lagos Flower Convention planned to hold over the weekend of August 9-11, 2019, and conclude in March 2020 with the Silverbird SME Award Night. All events will hold at the Atrium of the Silverbird Galleria in Victoria Island, Lagos.

From the event listing released, three events will potentially shape the excitement of the Circuit, the Gifts and Wraps Event scheduled for late December 2019, and the double header Cake Delight and Valentine Flower Festival both scheduled for the week of Valentine in February 2020.

The organisers expect that over its eight months duration, the Circuit will welcome more than 150,000 visitors to see the 200 exhibitors across its nine industry events.

UMEH Group unveils expansion of media businesses in Africa ISRAEL ODUBOLA

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s part of its desire to focus on telling inspiring African stories, Umeh Group has made new inroad into West Africa countries and other parts of Africa through its media group.

UMEH Group, a multi-national conglomerate based in South Africa, has interest in Real Estate, Finance and Blockchain Tech. The flagship company of the group, UMEH Group Limited, is headquartered in Johannesburg.

Group also invests, empowers, and grows companies in media production, publishing, financial management, consulting, investment, technology and broadcasting-enabled organisations led by worldclass management team. As a value-added investor through its subsidiaries with a long-term perspective, UMEH contributes professional expertise and multi-level support towards companies to realise their full potentials.

A sizable long-term capital base anchors UMEH’s investment approach, experience in structuring technology-oriented transactions, and proven management techniques that yield flexibility and opportunity.

UMEH Media includes Affluent TV, Affluent Africa, Star Magazine, Daily Africa, FX magazine, MLM Magazine, DJ Mag Africa, Crypto Magazine, PlusSize magazine.

Xolane Ndhlovu, a South African-born to Nigerian parents, founded the holding management firm and turned it into one of the most prominent privately owned tech asset management

companies in South Africa.

COO of UMEH Media, Davin Chetty, and editor of one of media arms of UMEH Media, Daily Afrika, Collins Hinamundi, in an interview, gave reasons why Ndhlovu is expanding the media arms.

They said, “Africa is enjoying massive growth. West Africa is one of the fastest growing regions in Africa. We want to be there as the region rises, and tell these and more stories. We want take part and also influence the conversations that take Africa forward.”

On plans to establish a Nigerian office, Hinamundi said, “A Nigeria office would ensure that we are on ground in a key regional influencer, and are able to grow as an organisation in the region. Nigeria especially is a power player on the continent and we are enthusiastic to coordinate our operations from Abuja and Lagos.”

The media top managers said Affluent was set to become UMEH Media biggest media venture with Affluent TV being on the pipeline.

Xolane Ndhlovu, according to a company spokesperson, “He is one of the humblest people you’ll ever meet. He is an incredibly curious person. He is also enormously generous and strong-willed.”

Ndhlovu manages the company’s investment strategies.

The company is currently a multi-million rand empire.

Born to John Umeh and Suzan Ndhlovu, Xolane Ndhlovu is a philanthropist and businessman from Mpumalanga, South Africa. He is a graduate of Georgia Institute of Technology, where he received an MBA. www.businessday.ng

L-R: Fatima Al-Ansar, head of mission, Ministry of Foreign Affairs; Khadijat Abdulkdir, chief technical officer, Africa Prudential plc; Ifedayo Durosinmi-Etti, founder, AGS Tribe , and Obianuju Nsofor, senior investment analyst, Platform Capital at the AGS Enterprise chaleenge grand finale and launch of ‘X’ in Lagos, yesterday.

Pic by Pius Okeosisi

NSACC holds July 2019 breakfast forum in Lagos

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he Nigeria – South Africa Chamber of Commerce (NSACC) will hold its July 2019 Breakfast Forum scheduled today at the Iris Hall, Eko Hotel and Suites in Victoria Island, Lagos by 7.30am prompt.

Darkey Africa, consul general of South Africa to Nigeria, will be the guest speaker.

He participated actively in the struggle against apartheid as an underground operative of the ANC and Umkhonto We Sizwe (Mk) recruiting identified individual to join MK outside South Africa and the South African Congress of Trade Union from 1976 until the ANC unbanning in the 1990s.

During this time, he also served as publicity secretary of the Huhudi Civic Association and organiser for the Garment and Allied Workers Union (GAWU) between 1980 and 1985 in Johannesburg, and also in the Regional Structures of the United Democratic front (UDF).

He will share insights on the topical issue: “Nelson Mandela:

The Epitome of Ethical Leadership in Africa: Learning from his Struggles for a Better Africa and a Humane World Order in our ever evolving society.

Iyke Ejimofor, executive secretary, NSACC, states that the event is primarily for captain of industries, business owners and top-level executives as well as other interested parties.

He adds that the chairman of the Chamber, Foluso Phillips and other executive directors are expected to attend the forum, noting that as in previous times, this edition will be educative and also insightful.

Ejimofor, on behalf of the Chamber, encourages everyone who wants to grow and strengthen his or her business or gain insights on how to thrive globally should make effort to attend. He expressed that the meeting is a “great door opener and participants will benefit in many ways, including: finding personal contacts for future follow up and initiate new vendor relationships, and so on.

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Falcon Corporation celebrates 25 years of corporate excellence

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alcon Corporation celebrated its 25 years of driving quality and excellence in the Nigerian Energy and Gas sector recently in Lagos. The event was attended

by Nigeria’s former minister of industry, trade and investment, Okechukwu Enelamah.

Other guests at the event were top industry stakeholders within the Nigerian energy and gas sector, policy makers, business partners, investors, customers, the Board and Management of Falcon Corporation and staff. The Falcon 25th anniversary event was tagged, A Night of Inspiration.

The event comes in the wake of her 25th year anniversary of operations and reflects, on one hand, Falcon’s growth and achievements over the past two and a half decades. On the other hand, it was a reinforcement of Falcon’s transformation, future strategic direction, national impact and goals for the future.

An ISO 9001:2015 Quality certified company, Falcon Corporation provides a range @Businessdayng

of services in Engineering, Procurement & Natural Gas which include pipeline construction, fabrications, and structural works, and technical procurement, to the major international Oil Companies and National Oil Companies.

In his opening address, Joe Ezigbo, managing director/ CEO, said, “Today marks the continuation of our long tradition of excellence, quality and unparalleled service delivery to our customers. Our organisation was founded on the principles of integrity and innovation, with a vision to make a tangible impact and elevate the profile of private entrepreneurial development in Nigeria.

“We started in Port Harcourt from our humble beginning as an Oil Service Company. Our change of operational base, scope of service and corporate name notwithstanding, our sound moral character, spirit of enterprise and excellence, resilience and commitment to creating long-term sustainable value has never wavered.”

Thursday 25 July 2019

BUSINESS DAY

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@Businessdayng

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Thursday 25 July 2019

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Wednesday 24 July 2019

Top Gainers/Losers as at Wednesday 24 July 2019 LOSERS

GAINERS Company

Company

Opening

Closing

Change

SEPLAT

N480

N525

45

NESTLE

NB

N56.1

N60

3.9

DANGCEM

BOCGAS

N4.61

N5.07

0.46

TOTAL

CILEASING

N4.55

N5

0.45

GUARANTY

AFRIPRUD

N3.5

N3.6

0.1

Opening

Closing

Change

N1327

N1300

-27

N174

N171

-3

N129.9

N127.5

-2.4

N29

N28.75

-0.25

N14.4

N14.15

-0.25

WAPCO

ASI (Points) DEALS (Numbers) VOLUME (Numbers) VALUE (N billion) MARKET CAP (N Trn)

28,088.74 3,253.00 157,790,339.00 2.523

Global market indicators FTSE 100 Index 7,501.46GBP -55.40-0.73% S&P 500 Index 3,008.28USD +2.81+0.09% Generic 1st ‘DM’ Future 27,216.00USD -108.00-0.40%

13.689

Deutsche Boerse AG German Stock Index DAX 12,522.89EUR +32.15+0.26% Nikkei 225 21,709.57JPY +88.69+0.41% Shanghai Stock Exchange Composite Index 2,923.28CNY +23.33+0.80%

Presco gets shareholders approval to pay N2bn dividend for 2018 Stories by Iheanyi Nwachukwu

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or the financial year ended December 31, 2018, shareholders of Presco Plc on Wednesday July 24 approved for the Board of Directors to pay N2billion dividend, amounting to 200kobo per share.

The company within the year under review recorded N21.34billion revenue and Profit After Tax (PAT) of N4.3billion.

While addressing shareholders on Wednesday in Benin, Edo State during the Company’s 26th Annual General Meeting (AGM), chairman of the company, Pierre Vandebeeck explained that Fresh Fruit Bunches (FFB) harvested was 191,672tons, as against 169,325tons in 2017 while Crude Palm Oil (CPO) produced was 42,893tons, compared to 37,637tons in 2017.

According to the chairman, Refined, Bleached

L–R: Dennis Olisa, executive director, Zenith Bank Plc, Adobi Nwapa, general manager, Zenith Bank Plc; Oscar N. Onyema, chief executive officer, The Nigerian Stock Exchange (NSE); Ebenezer Onyeagwu, group managing director/CEO, Zenith Bank Plc; Temitope Fasoranti, executive director, Zenith Bank Plc and Nonye Ayeni, general manager, Zenith Bank Plc during the Closing Gong Ceremony in commemoration of the appointment of the new GMD at the Exchange.

and Deodorized Oil (RBDO) produced was 21,726 tons, adding that at the end of the year 2018, total oil palm plantation hectare stood at 23,592 hectare with additional planting of 4,020 hectares.

The Managing Director, Felix Nwabuko also assured the shareholders

of a bright future based on ongoing expansion and investments.

Speaking during the meeting, shareholders commended the Board and Management for sustaining the company’s growth despite challenges.

Goodluck Akpore of the Onitsha Zone Share-

NSE donates N20m to support cancer detection initiatives across Nigeria

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he Nigerian Stock Exchange (NSE) has donated N20 million to support initiatives focused on promoting early detection as well as increasing awareness and advocacy for cancer-related causes in Nigeria. This donation is in line with its longstanding commitment to reduce the scourge of cancer in Nigeria. The donation was made known to participants by Oscar N. Onyema, Chief Executive Officer, NSE at the 2019 edition of the annual NSE Corporate Challenge.

Commenting on the development, Onyema, expressed delight at the donation. He said “we are

pleased to have hosted a very successful 6th edition of the NSE Corporate Challenge which recorded over 800 people in attendance.

In addition to the total proceeds from previous editions, the Exchange has committed to donate a sum of N20 million to scale up impact in screening and early detection of cancer. These funds will be channelled for the implementation of specific cancer-focused projects in partnership with technical partners”. “Since the launch of the NSE’s cancer awareness and fundraising campaign in 2014, a total sum of N63 million has been raised through www.businessday.ng

sponsorship and participation. We are pleased that NSE Corporate Challenge has grown into a signature cancer advocacy and fundraising event that many institutions are fast associating with to contribute their quota in raising awareness and funds to fight cancer”, added Onyema The donation by NSE will be used to bolster ongoing efforts by NSE’s technical partners to improve access to cancer supportive services and increase access for those in underserved communities to qualitative cancer consultation regardless of their level of health insurance or ability to pay.

holders Association commended what he described as the dedication of Board.

Making reference to the Board Charman, he said: “You are a man that we must respect and honour.

We are proud of your leadership and performance”.

The company informed

shareholders that the Host Communities Development Programme continued during the year under review, adding that “The focus was on education, roads, water, electricity and support to out-growers.”

Presco Plc in 2018 consolidated its growth agenda in 2018 with first class

research institutions, national and international Universities.

“We are committed to Research and Development. It is at the forefront of our new planting material development and has been very successful in increasing the quality of FFB and Oil production per hectare.

“We continue to put efforts to be leader in Research and Development.

“The amount expended on Research and Development in the year under review was N608.3million (2017:N238.6million).

“We have collaborated with first class research organizations, national and international universities.

“Every year, the research activities are increasing activities are increasingly bringing us closer to our ambition of establishing Presco as a Centre of Excellence for oil palm cultivation and research in the West African region”, the company said.

DMO lists FGN second N100bn Sukuk on NSE

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ebt Management Office (DMO) of Nigeria on Tuesday, July 23, 2019, listed on The Nigerian Stock Exchange, the second N100bn, 7-Year, FGN Sukuk due to mature in 2025. The Sukuk was raised at a rental rate of 15.743%, a 73-basis point discount from the 16.47% rental rate of the maiden issuance listed in April 2018.

Sukuk bonds are structured t generate returns to ethical investors without infringing on the Islamic principles which forbid interest payments. It represents an ownership interest in the asset to be financed rather than in a

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debt obligation.

According to DMO, the aim of the FGN Sukuk is to promote financial inclusion and deepen of the investor base for FGN securities. It will be deployed to financing infrastructure, in keeping with the Government’s commitment to bridging the infrastructural gap across the country.

Commenting on the Listing, Head, Trading Business Division, NSE, Jude Chiemeka said, “At the Exchange, we believe enhancing access to capital for the Federal Government and the private sector is key to national economic growth. This is the motivation behind our commitment to promote and support the @Businessdayng

growth of the debt market in Nigeria. Our efforts are geared towards expanding the NSE’s position as the multiasset hub, creating ample possibilities for our key stakeholders, while delivering a transparent and liquid market to investors”.

The emerging and frontier markets can expect greater traction in their quest to continually unlock dormant pools of capital.

This listing is particularly important in scaling development for these economies characterized by daunting growth in infrastructure and also have a strong bias for Islamic Finance”.

Thursday 25 July 2019

BUSINESS DAY

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@Businessdayng

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Thursday 25 July 2019

BUSINESS DAY

Live @ The STOCK Exchanges Prices for Securities Traded as of Wednesday 24 July 2019 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 229,266.71 6.65 1.53 106 3,221,646 UNITED BANK FOR AFRICA PLC 191,516.76 5.65 -0.88 290 30,731,500 ZENITH BANK PLC 583,974.78 18.60 0.54 325 22,885,807 721 56,838,953 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 202,808.40 5.65 -0.88 206 5,632,949 206 5,632,949 927 62,471,902 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,585,023.16 127.00 -0.04 125 2,610,404 125 2,610,404 125 2,610,404 BUILDING MATERIALS DANGOTE CEMENT PLC 2,913,926.77 173.00 -1.72 62 142,521 LAFARGE AFRICA PLC. 227,925.31 14.15 -1.74 98 1,118,844 160 1,261,365 160 1,261,365 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 308,933.39 525.00 9.38 15 23,642 15 23,642 15 23,642 1,227 66,367,313 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 85.50 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 0 0 UPDC REAL ESTATE INVESTMENT TRUST 14,408.66 5.40 - 0 0 0 0 0 0 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 0 0 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 OKOMU OIL PALM PLC. 53,228.18 55.80 - 2 2,309 PRESCO PLC 44,800.00 44.80 - 6 13,140 8 15,449 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,520.00 4.26 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,440.00 0.48 - 7 48,202 7 48,202 15 63,651 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 847.13 0.32 - 1 1,400 JOHN HOLT PLC. 179.01 0.46 - 1 690 S C O A NIG. PLC. 1,903.99 2.93 - 0 0 TRANSNATIONAL CORPORATION OF NIGERIA PLC 41,460.95 1.02 4.08 131 9,340,506 U A C N PLC. 16,279.33 5.65 -4.24 50 1,503,160 183 10,845,756 183 10,845,756 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 1 10 1 10 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 23,760.00 18.00 - 24 98,920 ROADS NIG PLC. 165.00 6.60 - 0 0 24 98,920 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 3,092.09 1.19 - 6 34,001 6 34,001 31 132,931 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 13,231.85 1.69 - 1 100 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 100,757.61 46.00 - 28 43,667 INTERNATIONAL BREWERIES PLC. 118,622.89 13.80 - 27 30,120 NIGERIAN BREW. PLC. 479,814.12 60.00 6.95 46 316,320 102 390,207 FOOD PRODUCTS DANGOTE FLOUR MILLS PLC 89,250.00 17.85 - 177 1,106,902 DANGOTE SUGAR REFINERY PLC 127,200.00 10.60 -1.85 71 1,403,594 FLOUR MILLS NIG. PLC. 57,405.31 14.00 - 150 2,880,049 HONEYWELL FLOUR MILL PLC 7,692.29 0.97 - 43 282,975 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 1 30 NASCON ALLIED INDUSTRIES PLC 35,767.42 13.50 -3.70 16 562,045 UNION DICON SALT PLC. 3,321.07 12.15 - 0 0 458 6,235,595 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 21,411.50 11.40 0.44 25 213,096 NESTLE NIGERIA PLC. 1,030,453.13 1,300.00 -2.03 73 142,062 98 355,158 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 5 152 VITAFOAM NIG PLC. 4,653.14 3.72 0.54 7 264,230 12 264,382 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 23,822.86 6.00 - 29 270,550 UNILEVER NIGERIA PLC. 183,840.17 32.00 - 29 79,249 58 349,799 728 7,595,141 BANKING ECOBANK TRANSNATIONAL INCORPORATED 165,145.96 9.00 - 34 289,179 FIDELITY BANK PLC 46,649.42 1.61 2.55 31 2,405,413 GUARANTY TRUST BANK PLC. 846,146.40 28.75 -0.86 230 33,593,780 JAIZ BANK PLC 12,374.98 0.42 -4.55 10 579,000 SKYE BANK PLC 10,687.83 0.77 - 0 0 STERLING BANK PLC. 67,369.58 2.34 -3.70 20 11,435,447 UNION BANK NIG.PLC. 199,477.16 6.85 - 50 1,481,890 UNITY BANK PLC 6,779.82 0.58 -9.37 13 420,347 WEMA BANK PLC. 23,530.42 0.61 -1.61 12 565,944 400 50,771,000 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 4,366.03 0.63 - 11 145,113 AXAMANSARD INSURANCE PLC 17,325.00 1.65 - 1 20 CONSOLIDATED HALLMARK INSURANCE PLC 2,439.00 0.30 7.14 1 100,000 CONTINENTAL REINSURANCE PLC 19,811.94 1.91 - 0 0 CORNERSTONE INSURANCE PLC 2,945.90 0.20 - 7 51,400 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 2,563.20 0.35 2.94 6 358,297 LAW UNION AND ROCK INS. PLC. 2,019.28 0.47 - 1 17,071 LINKAGE ASSURANCE PLC 4,080.00 0.51 -3.77 11 646,416 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 3 48,950 NEM INSURANCE PLC 10,983.45 2.08 - 2 1,030 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,422.15 0.45 -6.25 2 141,000 REGENCY ASSURANCE PLC 1,333.75 0.20 - 1 1,000 SOVEREIGN TRUST INSURANCE PLC 1,668.16 0.20 -4.76 2 228,443 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 1 100 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 0 0 WAPIC INSURANCE PLC 5,353.10 0.40 5.26 23 580,270 72 2,319,110

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MICRO-FINANCE BANKS FORTIS MICROFINANCE BANK PLC 11,799.67 2.58 - 0 0 2,583.90 1.13 - 5 755,000 NPF MICROFINANCE BANK PLC 5 755,000 MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,158.00 0.99 - 0 0 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 5,796.93 1.39 - 0 0 INFINITY TRUST MORTGAGE BANK PLC RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 2,949.22 3.02 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 7,200.00 3.60 2.86 33 664,909 CUSTODIAN INVESTMENT PLC 35,879.37 6.10 - 5 51,602 660.00 0.44 - 0 0 DEAP CAPITAL MANAGEMENT & TRUST PLC FCMB GROUP PLC. 31,486.31 1.59 0.63 30 2,119,347 ROYAL EXCHANGE PLC. 1,131.98 0.22 - 0 0 390,165.07 38.10 - 16 39,838 STANBIC IBTC HOLDINGS PLC UNITED CAPITAL PLC 12,300.00 2.05 0.49 78 6,421,975 162 9,297,671 639 63,142,781 HEALTHCARE PROVIDERS EKOCORP PLC. 1,680.29 3.37 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 781.69 0.22 - 2 5,300 2 5,300 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 544.04 0.55 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 8,554.08 4.10 - 2 9,900 GLAXO SMITHKLINE CONSUMER NIG. PLC. 9,567.01 8.00 - 7 81,000 4,140.56 2.40 - 11 192,970 MAY & BAKER NIGERIA PLC. NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 1,044.54 0.55 - 6 16,783 556.71 3.62 - 0 0 NIGERIA-GERMAN CHEMICALS PLC. PHARMA-DEKO PLC. 325.23 1.50 - 0 0 26 300,653 28 305,953 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 710.40 0.20 - 3 371,618 3 371,618 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 648.00 6.00 - 0 0 346.47 0.70 - 4 4,332 TRIPPLE GEE AND COMPANY PLC. 4 4,332 PROCESSING SYSTEMS CHAMS PLC 1,174.02 0.25 - 6 64,284 E-TRANZACT INTERNATIONAL PLC 9,996.00 2.38 - 2 2,188 8 66,472 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,215,762.01 323.50 - 4 136,433 4 136,433 19 578,855 BUILDING MATERIALS BERGER PAINTS PLC 1,825.89 6.30 - 4 13,500 CAP PLC 17,325.00 24.75 - 19 32,089 CEMENT CO. OF NORTH.NIG. PLC 164,950.94 12.55 - 22 93,055 FIRST ALUMINIUM NIGERIA PLC 844.14 0.40 - 0 0 313.43 0.59 - 0 0 MEYER PLC. PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,959.74 2.47 - 1 20,000 PREMIER PAINTS PLC. 1,156.20 9.40 - 0 0 46 158,644 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 2,624.37 1.49 - 6 103,275 6 103,275 PACKAGING/CONTAINERS BETA GLASS PLC. 33,173.14 66.35 - 5 790 GREIF NIGERIA PLC 388.02 9.10 - 2 790 7 1,580 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 59 263,499

CHEMICALS B.O.C. GASES PLC. 2,110.36 5.07 9.98 5 104,105 5 104,105 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 92.40 0.42 - 0 0 0 0 5 104,105 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,377.79 0.22 10.00 20 3,647,645 20 3,647,645 INTEGRATED OIL AND GAS SERVICES OANDO PLC 49,725.65 4.00 - 36 613,431 36 613,431 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 56,974.05 158.00 - 20 37,505 CONOIL PLC 14,052.53 20.25 - 47 72,509 ETERNA PLC. 4,368.88 3.35 - 14 67,005 FORTE OIL PLC. 23,640.03 18.15 -0.28 77 3,469,722 MRS OIL NIGERIA PLC. 6,354.80 20.85 - 4 404 TOTAL NIGERIA PLC. 43,289.03 127.50 -1.85 20 58,935 182 3,706,080 238 7,967,156 ADVERTISING AFROMEDIA PLC 1,820.01 0.41 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 17,551.17 1.80 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 341.14 0.29 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 3,112.54 5.28 - 3 11,285 TRANS-NATIONWIDE EXPRESS PLC. 328.19 0.70 - 5 55,943 8 67,228 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,723.78 3.05 - 0 0 IKEJA HOTEL PLC 2,785.59 1.34 - 3 22,220 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 2 70 TRANSCORP HOTELS PLC 41,042.18 5.40 - 0 0 5 22,290 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,800.00 0.40 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 241.92 0.40 - 4 3,933 LEARN AFRICA PLC 1,080.03 1.40 - 13 12,503 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 776.54 1.80 - 23 3,825

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@Businessdayng

Thursday 25 July 2019

FT

BUSINESS DAY

45

FINANCIAL TIMES

World Business Newspaper

KADHIM SHUBBER AND LAUREN FEDOR IN WASHINGTON

R

obert Mueller said he had not cleared Donald Trump of allegations of obstructing justice as the former special counsel testified before Congress about his investigation into the 2016 Trump presidential campaign’s ties with Russia.

His appearance before the House judiciary committee on Wednesday morning marked the first time he had been questioned in public about his 22-month probe. It served largely as a platform for Democrats and Republicans to amplify narratives about Mr Mueller’s investigation they have long pushed.

Over more than three hours, Mr Mueller said relatively little as Democrats read excerpts from his report and asked the former special counsel to confirm the most damning findings about Mr Trump’s conduct. Republicans on the committee redirected attention to Mr Mueller himself and the origins of the investigation, which the president has depicted as a “witch hunt” launched by his political foes.

Mr Mueller was terse by contrast. He frequently gave oneword answers, asked for the question to be repeated or referred back to his written findings, saying in various ways: “I stand by what’s in the report”. Mr Mueller spoke more extensively, and passionately, when defend-

Robert Mueller dismisses Trump claim of ‘total exoneration’

Former special counsel outlines ‘sweeping, systematic’ Russian interference in US election

Robert Mueller is sworn in by House judiciary committee chairman Jerold Nadler © Reuters

ing the integrity of his team and their findings “We strove to hire individuals who could do the job. I’ve been in the business for almost 25 years.

In those 25 years, I’ve not had

occasion once to ask about somebody’s political affiliation. It is not done. What I care about is the capability of the individual to do the job and do the job seriously and quickly and with integrity.”

Jerrold Nadler, the Democratic House judiciary chair, sought to pin Mr Mueller down on whether he had “totally exonerated” the president, as Mr Trump has claimed. “No,” the former special

counsel replied.

Mr Nadler asked whether justice department policy — which says a sitting president cannot be indicted — would allow Mr Trump to be “prosecuted for obstruction of justice crimes after he leaves office”.

Mr Mueller replied: “True.”

When asked later by Ted Lieu, a Democrat from California, whether that policy was the reason he did not indict Mr Trump, Mr Mueller responded: “That’s correct.”

It was not clear if Mr Mueller’s statement was an inadvertent mis-step. He has previously said he did not make a determination on whether the president could be charged with a crime.

Ken Buck, a Republican from Colorado, pressed Mr Mueller on why he did not make a decision on obstruction, despite describing at length several incidents of possible obstruction.

“You unfairly shifted the burden of proof to the president,” said Mr Buck, before asking him whether there was sufficient evidence to charge Mr Trump.

Boeing sinks to biggest ever Selmayr sent to Vienna as von der quarterly loss on 737 Max crisis Leyen stamps authority on Brussels Prolonged grounding of bestselling jet takes its toll on US aircraft maker SYLVIA PFEIFER IN LONDON

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oeing slumped to its biggest ever quarterly loss as the prolonged grounding of its bestselling 737 Max jet took its toll on the US aircraft maker.

The aerospace manufacturer also warned that it might have to halt production if it has to revise its expected return to service later this year.

Boeing said it expected the Max to start returning to the skies “early in the fourth quarter” but cautioned that it might have to further reduce or temporarily shut down production if the timing slipped significantly.

Boeing cut production of the 737 Max from 52 to 42 a month in April after its worldwide grounding in March following two fatal crashes that killed 346 people.

Dennis Muilenburg, Boeing chief executive, said on Wednesday that while the company planned to boost its production rate gradually to 57 a month next year, any slippage could derail those plans.

“Should our estimate of the

anticipated return to service change, we might need to consider possible further rate reductions or other options including a temporary shutdown of the Max production,” Mr Muilenburg said.

He said the company continued to work on software changes and expected to submit its “final certification package” to the Federal Aviation Administration, the US aviation safety regulator, “somewhere in the September timeframe”.

His comments came as Boeing reported a net loss of $2.94bn for the second quarter after announcing last week that it would book an after-tax charge of $4.9bn in the period to compensate airlines that have been affected by the grounding of the 737 Max. The net loss compares with a profit of $2.2bn in the same period last year.

Revenues in the second quarter were also down to $15.7bn, from $24.5bn the year before, reflecting the impact of the Max crisis but buoyed by higher volumes in its defence and services businesses. www.businessday.ng

Powerful European Commission bureaucrat will have EU role in Austria ALEX BARKER AND MEHREEN KHAN IN BRUSSELS

M

artin Selmayr, the most controversial, powerful and shortlived head of the European Commission’s civil service who one critic said should be sent to “Outer Mongolia”, is leaving Brussels for the relative backwater of Austria.

In what the German official’s many antagonists will see as an abrupt demotion, Mr Selmayr is to be posted to Vienna as head of the EU’s delegation there, representing the bloc in what is a quasi-ambassadorial role.

A close lieutenant of JeanClaude Juncker, the outgoing president, Mr Selmayr’s unrivalled grip on the bureaucracy of Brussels, as well as his notoriety and ruthless working methods, quickly overshadowed many of the politicians on the commission.

“The five years of the Jean Claude Juncker commission would be inconceivable without

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his contribution,” said Günther Oettinger, the commissioner for human resources.

But Mr Selmayr’s all-powerful reputation as Mr Juncker’s chief of staff and later commission secretary-general made him countless enemies in other parts of Brussels.

He shrugged off the criticisms, once telling the Financial Times: “You cannot run the European Commission like a Montessori school.”

The announcement of his move, to take effect from November, comes just days after Ursula von der Leyen was confirmed as the next president of the commission.

The incoming head of the EU executive has decided to replace Mr Selmayr to satisfy his opponents in the European Parliament and dispel doubts about her authority when she takes over.

Many MEPs had demanded Mr Selmayr’s departure as a condition for supporting Ms von der Leyen, including Socialists, Greens and even some German @Businessdayng

centre-right MEPs who hail from the same CDU party as Mr Selmayr.

Philippe Lamberts, the leader of the Green group, had suggested Ms von der Leyen dispatch Mr Selmayr to represent the EU “in Outer Mongolia”.

Even a less controversial figure than Mr Selmayr might have struggled to overcome objections to Brussels’ top civil servant being of the same nationality as the incoming president, Germany’s former defence minister.

His stint as secretary-general has been dogged by controversy over the nature of his sudden appointment in March last year, which involved a double promotion in the space of a few minutes. The European Parliament alleged the switch of jobs was “coup-like”.

One ambassador in Brussels said: “He lived by the sword and in the end they cut him down”.

Another said: “We are sorry to see him go. He was very capable.

Every man has his weaknesses.

But he got things done.”

46

Thursday 25 July 2019

BUSINESS DAY

FT

NATIONAL NEWS

Department of Justice opens review into Big Tech’s market power US probes if companies are smothering competition, as Mnuchin says Amazon ‘destroyed’ the retail industry RICHARD WATERS IN SAN FRANCISCO

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he US Department of Justice announced a broad antitrust investigation into the leading online platforms, raising the stakes in Washington’s scrutiny of Big Tech’s power over growing parts of the economy.

The agency said it would look into how the platforms had achieved their market power, and whether they were “engaging in practices that have reduced competition, stifled innovation or otherwise harmed consumers”.

Though it did not name the companies under investigation, the department said in a statement it would look into “widespread concerns” expressed about “search, social media and some retail services online” — suggesting that Google, Facebook and Amazon will be at the centre of the review.

O n We d n e s d ay , St e v e n Mnuchin, US Treasury secretary, said the investigation was tackling an “important issue”.

“I think if you look at Amazon, although there are certain benefits to it, they’ve destroyed the retail industry across the United States so there’s no question they’ve limited competition,” he said in an interview with CNBC. Shares in Amazon and other tech groups were down modestly following the DoJ’s announcement, which came late on Tuesday. Amazon stock was down 0.6 per cent in Wednesday morning trading and Facebook was off 0.3 per cent. Shares in Alphabet, Google’s parent company, traded 0.4 per cent lower. Facebook declined to comment, and the other large platform companies did not respond.

The DoJ move comes after the outgoing European Commission signalled it was also looking to become more aggressive in checking the market power of the largest online platform companies. A report commissioned by the EU in April recommended lowering the bar for companies deemed “dominant players”, subjecting them to stricter antitrust rules.

Donald Trump has been critical of the EU’s scrutiny of American tech groups, suggesting it should be US rather than European authorities investigating wrongdoing by the technology sector.

Tuesday’s justice department announcement came the day before what is expected to be the imposition of the largest ever penalty levied by the Federal Trade Commission, America’s other main competition authority.

The FTC is expected to announce that Facebook will pay about $5bn to settle an investigation into multiple claims that the social network misused its

users’ data.

This will include allegations, first reported by The Washington Post, that the company passed on the phone numbers of users without their full knowledge, and failed to fully disclose to users how they might turn off Facebook’s facial recognition technology, according to one person familiar with the situation.

Under the terms of the deal, Facebook will be required to change how it handles and stores user data, and to be more transparent about its practices.

A few weeks ago US antitrust officials agreed to a broad carveup in their responsibility for investigating individual tech companies, with the DoJ undertaking to study Google and Apple and the FTC looking into Facebook and Amazon.

That decision drew criticism from Mike Lee, the Republican chairman of the Senate’s antitrust subcommittee, who said dividing up the tech investigations would be “less effective and coherent” than if one agency took on the work.

David Balto, a former head of policy in the FTC’s antitrust division, said Tuesday’s announcement appeared to show that the DoJ had now taken on sole responsibility for taking on the big tech companies. The depth of expertise and experience at the justice department made it the natural agency to take the lead, he said, adding: “It would seem to be a poor use of government resources” for both agencies to be involved.

However, a person close to one of the leading tech companies cast doubt on that conclusion, and said the DoJ appeared to be carving out a new area of investigation over the head of the FTC by taking on a broad review of issues raised by tech platforms.

That raised the possibility that the agencies would eventually come to different conclusions in their investigations into some of the same companies, this person said.

The DoJ’s first public declaration about the focus of its own inquiries, in a terse statement issued late on Tuesday, did not address the earlier arrangement with the FTC and left some legal experts questioning how Washington would proceed.

“I’d think there would be more co-ordination between the DoJ and the FTC,” said Carl Tobias, a law professor at the University of Richmond, Virginia, adding that it was impossible to tell whether the agencies were now “working together”.

Tuesday’s statement appeared to show Makan Delrahim, the Trump appointee who heads the DoJ’s antitrust division, was now firmly in charge of scrutinising Big Tech, Mr Tobias said. www.businessday.ng

Mark Zuckerberg, chief executive, and the privacy officers will be required to certify that the company is in compliance with Facebook’s privacy programme on a quarterly basis © AP

Facebook to pay $5bn to resolve probe into privacy violations Zuckerberg will have to certify compliance with new data rules every quarter KIRAN STACEY IN WASHINGTON AND HANNAH MURPHY IN SAN FRANCISCO

F

acebook has agreed to pay more than $5bn to settle its cases with US regulators over misusing user data, in two settlements that it hopes will help alleviate some of the political hostility it has faced since the Cambridge Analytica scandal.

The Federal Trade Commission announced on Wednesday it had agreed a settlement with the social media company, which marked the largest civil penalty the commission has ever handed out.

Facebook has also agreed to impose new privacy protections as part of the agreement, including setting up a privacy committee, which will be independent from the board, and to appoint individual privacy compliance officers.

Mark Zuckerberg, chief executive, and the privacy officers will be required to certify that the company is in compliance with Facebook’s privacy programme on a quarterly basis. “Any false certification will subject them to individual civil and criminal penalties,” the FTC said.

Separately, the company has

also agreed to pay $100m to the Securities and Exchange Commission, which said Facebook had made misleading disclosures over the misuse of user data.

The cases were both launched in the wake of the Cambridge Analytica data scandal in which user data were leaked to a political research group through a third-party app.

Since the scandal, Facebook has faced a barrage of criticism from regulators and politicians in Europe and the US, which have accused the company not only of misusing user data but also allowing its platforms to be used to spread disinformation.

Facebook’s shares were down 0.6 per cent in morning, trading at $201, suggesting the settlement was broadly as investors had expected.

An ‘unprecedented’ penalty Joe Simons, the chair of the FTC, said of the Facebook settlement: “The magnitude of the $5bn penalty and sweeping conduct relief are unprecedented in the history of the FTC. The relief is designed not only to punish future violations but, more importantly, to change Facebook’s entire privacy culture to decrease the likelihood of continued violations.”

The decision has split the FTC

internally however, with the two Democratic commissioners voting against the settlement for not going far enough.

In a dissenting statement, Rohit Chopra, one of the Democratic commissioners, said: “The proposed settlement does little to change the business model or practices that led to the recidivism.

“The settlement imposes no meaningful changes to the company’s structure or financial incentives, which led to these violations.

Nor does it include any restrictions on the company’s mass surveillance or advertising tactics.”

Six key terms of Facebook’s deal with the FTC - Facebook must launch an independent privacy committee, which the FTC says will remove the “unfettered control” of chief Mark Zuckerberg over privacy-related decisions.

- The company must create a team of privacy compliance officers, who must, with Zuckerberg, certify that the company is in compliance with Facebook’s privacy programme on a quarterly basis to the commission. “Any false certification will subject them to individual civil and criminal penalties,” the FTC said.

Eurozone manufacturing activity worst in almost seven years PMI data show German and French factory sectors suffering CLAIRE JONES IN FRANKFURT AND MYLES MCCORMICK IN LONDON

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he woes of the eurozone’s manufacturers are worsening, with a closely watched gauge of the export-dependent sector hitting its lowest level in more than six and a half years in July.

The purchasing managers’ index for manufacturing, produced by data firm IHS Markit, fell to 46.4 — a 79-month low. The July figure, down from a reading of 47.6 in June, is significantly below the crucial 50 level that marks steady growth.

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The lacklustre figures follow disappointing numbers for factory activity in both of the eurozone’s two biggest economies. IHS data showed German manufacturing activity hitting a seven-year low, while in France it stalled after a promising June.

“With growth slowing, job creation fading and price pressures having fallen markedly compared to earlier in the year, the survey will give added impetus to calls for more aggressive stimulus from the European Central Bank,” said Chris Williamson, chief business economist at IHS. @Businessdayng

While the reading is only the latest piece of evidence that manufacturing in the region remains under pressure from Brexit and trade frictions, there are few signs that this is feeding through into the dominant services sector.

Activity in Germany’s manufacturing sector underwent one of its most marked contractions since 2009, according to the IHS figures for that country, dropping to 43.1 from 45 the previous month. This was significantly below the expectations of economists in a Reuters poll, who had forecast an increase to 45.2.

Thursday 25 July 2019

BUSINESS DAY

47

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

China is using trade war with US to defeat liberal thinkers

Xi Jinping frames conflict as a fight against national humiliation to consolidate his power SHIRLEY YU

S

teve Bannon, the former adviser to Donald Trump, calls the USChina trade war a fight to prevent Beijing from becoming a “global hegemonic power”. China’s fourth most powerful leader Wang Yang, matches this rhetoric, calling it the “grand game of the century” in a closeddoor meeting with Taiwan delegates.

The goal of the trade war is to glorify neither liberal trade, nor the liberal global order, but American hegemony. China’s rise makes the strategic conflict destined to happen.

The optimal strategy for Beijing would be delay, to avoid global economic calamity and to give China much-needed time to build alternative global manufacturing supply chains, strengthen trading routes through Eurasia and the Pacific, and upgrade its technological collaboration with Europe.

Within China, President Xi Jinping has successfully portrayed the trade war as a US attempt to inflict national humiliation. His faction within the Communist party gains legitimacy by not going soft on the US. The faction of economic lib-

erals has been largely silenced.

This group is represented by the princelings and elites, many of them educated in the US, who fostered China’s integration into the global system over the past three decades under former Chinese premier Zhu Rongji, and his protégé vice-president Wang Qishan.

Some of them spoke out initially: Li Ruogu, former president of China’s Export-Import Bank, warned that China as the weak side . . . “must know how to make a retreat”. And Long Yongtu, formerly Beijing’s chief negotiator at the World Trade Organization, said in November that China should have avoided hitting back at America with tariffs on soyabeans.

When nationalism and populism meet in China, economic liberals are attacked as traitors to the country’s rightful cause, and accused of surrendering to America. After former finance minister Lou Jiwei called Mr Xi’s “Made in China 2025” plan a waste of taxpayers’ money, he was unexpectedly ousted as chair of the country’s National Social Security Fund.

With the trade war, Mr Xi has successfully waged a war not only against liberal market forces but also liberal thinking within his party.

AT&T loses more TV subscribers than expected as Americans cut the cord WarnerMedia and wireless business help telecoms group to in-line quarterly results ANNA NICOLAOU IN NEW YORK

A

T&T bled nearly a million television customers in the second quarter, a steeper loss than analysts had expected as Americans ditch their cable boxes in favour of online alternatives.

However, strength in its WarnerMedia entertainment division and wireless phone business helped the largest US telecoms group meet forecasts for earnings and sales.

AT&T lost 946,000 total video subscribers in the quarter, while analysts polled by FactSet were forecasting a 652,000 loss.

The Texas-based company made adjusted earnings of 89 cents a share on $45bn in sales, both roughly in line with consensus forecasts.

Shares were down 1.5 per cent in pre-market trade.

In a presentation to investors, AT&T highlighted the progress it has made in cutting down debt as it tries to trim the heavy debt load it took on to buy Time Warner last year. The company’s net debt stood at $162bn at the end of June, down from $171bn at the end of 2018.

“We continue to pay down debt and are more confident than ever that we’ll meet our year-end deleveraging goal,” said Randall Stephenson, chairman and chief executive of AT&T. Earlier this year, the company sold its 9.5 per cent stake in Hulu for $1.43bn and shed its Hudson Yards office for about $2.2bn.

AT&T, like its peers, has seen its traditional television and wireless phone businesses come under pressure in recent years, as insurgents such as Netflix and T-Mobile have stolen market share.

However, wireless was a bright spot in the quarter: AT&T added 72,000 postpaid phone subscribers, the most lucrative type of customers.

While rival Verizon has doubled down on its core businesses, AT&T has instead jumped into media content to compete head-on with Netflix. Through an $80bn takeover of Time Warner, the Texas-based phone company now controls HBO, the Warner Bros film studio, and a trove of TV channels.

Revenues at WarnerMedia grew 5.5 per cent to $8.4bn in the quarter, boosted by the performance the superhero film Shazam!, which has grossed more than $360m globally. www.businessday.ng

Xi Jinping has successfully waged a war not only against liberal market forces but also liberal thinking within his party © Getty

Deutsche Bank slumps to largest quarterly loss since 2015 German lender takes large restructuring charge as part of overhaul of the group OLAF STORBECK IN FRANKFURT AND STEPHEN MORRIS IN LONDON

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eutsche Bank has slumped to its biggest quarterly loss since 2015 after the embattled lender took a hefty restructuring charge to shrink its investment bank.

Germany’s biggest bank took a charge of €3.4bn, just under half the expected total bill for an overhaul announced this month that will see 18,000 jobs cut, the lender’s balance sheet slashed and a bad bank created.

As a result, the bank was left with a net loss of €3.1bn in a quarter during which its investment bank, once the spearhead of Deutsche’s global ambitions, again struggled. It fell to a €907m pre-tax loss in the period as revenues fell 18 per cent.

“The second quarter illustrated the need for Deutsche to take action, but also that it is likely to be a long road until we have visibility on the many stepping stones . . . for returns to improve,” said Anke Reingen, an analyst with RBC Capital Markets.

“Execution on the new transformation plan remains key.”

Even though the quarterly loss had been flagged, the shares dropped as much as 5 per cent before recovering to trade down 2.2 per cent. They remain down 33 per cent over the past 12 months.

Deutsche chief executive Christian Sewing is embarking on one of the deepest restructurings in banking history just as speculation builds that the European Central Bank will loosen monetary policy this year in an attempt to help the eurozone economy.

Should the ECB, which meets on Thursday, cut interest rates further into negative territory this year, this “could become more painful for us”, said one senior executive, echoing the caution from UBS on Tuesday.

Since the planned restructuring was revealed earlier this month, more than 900 employees have been told their jobs will go and progress has been made offloading equities clients and staff to French rival BNP Paribas, Deutsche said.

The bank is preparing the next round of cuts in rates trading and support functions, but declined to give more details. Deutsche said it had already jettisoned 13 per cent

of the €288bn of risk-weighted assets earmarked for sale, resulting in a small gain for the bank.

However, the bank said it had second thoughts about hiving off operations generating €550m in annual revenue, and will now keep them in the investment bank. These businesses include “equities services provided to corporations” like “share repurchase programmes, selective margin lending”, according to chief financial officer James von Moltke.

Excluding the restructuring charges, net income for the quarter was €231m, while adjusted pre-tax profit came in at €441m, missing analysts’ estimates. Overall group revenue fell 6 per cent to €6.2bn.

While a hit to earnings was expected at the investment bank, performance still undershot expectations. Revenue from fixedincome trading, a historic strength for Deutsche, declined 11 per cent, worse than that of Wall Street rivals. Merger advisory and capital markets revenue fell almost a third, while the bank singled out its large leveraged finance business as disappointing.

Caterpillar hit by deceleration of US shale boom Weaker equipment demand from Permian knocks industrial bellwether MYLES MCCORMICK IN LONDON

A

slowdown in the US shale boom made itself felt in the most recent results of heavy equipment maker Caterpillar, which on Wednesday reported a sharp dip in sales to the energy sector.

The industrial bellwether recorded an 11 per cent drop in revenues from the oil and gas industry in the second quarter, citing “lower demand for new equipment in the Permian Basin”.

The company retained its full year profit guidance of $12.06-

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$13.06 a share, but said it expected to come in at the lower end of this — assuming a recovery in oil and gas by the end of the year. Shares in Caterpillar were down 4 per cent in pre-market trading.

The US shale boom has driven up American oil production exponentially in recent years, but lately investment has slowed and recent indicators have highlighted a deceleration in production growth.

Despite the weaker results in energy, Caterpillar was boosted by stronger demand from the construction sector, where sales jumped 5 per cent, and natural resources, which rose 11 per cent. @Businessdayng

Overall revenues were up 3 per cent at $14.4bn for the quarter, with consolidated operating profit up 2 per cent at $2.213bn.

“Sales and revenues increased this quarter, including a record performance from Construction Industries, which reflected our strong competitive position globally,” said Caterpillar chairman and chief executive Jim Umpleby.

“Our strong operating cash flow in the quarter allowed us to repurchase shares and pay dividends of about $1.9 billion. This is in line with our intention to return substantially all free cash flow to shareholders.”

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Thursday 25 July 2019

BUSINESS DAY

ANALYSIS

FT

AI’s new workforce: the data-labelling industry spreads globally

Hundreds of thousands employed in lower-income countries such as India and Philippines MADHUMITA MURGIA

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n the fringes of the Indian city of Kolkata, in the dusty, crowded neighbourhood of Metiabruz, 460 young women are working at the vanguard of artificial intelligence.

The women, mostly from the local Muslim community, are helping to train computer vision algorithms used in autonomous vehicles and augmented reality systems, for the likes of Amazon, Microsoft, eBay and TripAdvisor.

The all-female centre is one of eight Indian offices operated by iMerit, an India- and US-based data annotation company, whose 2,200 local employees label the oceans of data generated by industries as diverse as manufacturing, medical imaging, autonomous driving, retail, insurance and agriculture.

The operation is part of a growing data-labelling industry that employs hundreds of thousands of workers in lower-income countries including Kenya, India and the Philippines.

Companies such as Figure Eight and Mighty AI, and more traditional IT companies such as Accenture and Wipro, are forming part of a socalled “AI supply chain” that creates algorithms able to interpret material including driving footage, search re-

sults and photos for the largest US and European multinationals, including Facebook, Volkswagen and Google.

Today, companies are embracing artificial intelligence as a way to automate decision-making and help drive new business opportunities. The challenge is that the algorithms that underpin the technology are as naive as newborns. They need to be fed millions of labelled examples to teach them to “see”.

For a self-driving car algorithm to be taught the meaning of road signs, or to tell the difference between a child and a fox, hours of footage have to be watched and objects tagged, frame by frame. An hour of video takes eight hours to annotate. In fact, a McKinsey report from 2018 listed data labelling as the biggest obstacle to AI adoption in industry.

According to a January 2019 report by analyst firm Cognilytica, the market for third-party data labelling solutions was $150m in 2018, growing to more than $1bn by 2023. “The largest technology companies don’t want to be in the business of training data, they want to own customer relationships [and] are using partners and procurement wisely,” said Leila Janah, founder and chief executive of Samasource, a San Francisco-based data labelling vendor with offices in Kenya, Uganda, and the US.

The promise of America’s first all-women ticket In presidential elections, voters tend to choose personalities opposite to the incumbent EDWARD LUCE

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et us imagine Democrats do not pick a septuagenarian man to run against Donald Trump next year. Some may think this far-fetched. After all, Joe Biden, 76, leads the polls and Bernie Sanders, 77, comes second. But both have been losing ground to two women, Elizabeth Warren and Kamala Harris. Momentum counts in primary elections. Hillary Clinton may have botched her chances in 2016. But she was one of a kind. It is quite possible there could be two women on the Democratic ticket next year. More to the point, it could be desirable.

This is not simply because these candidates are women. Unlike Mrs Clinton, neither Ms Warren nor Ms Harris are running to break the glass ceiling. Ms Warren wants to unrig American capitalism in favour of the middle classes.

Ms Harris wants to make America a fairer society. They share pros and cons. Both are strong figures who generate excitement among — and raise a lot of money from — the party’s base. Each has also made herself hostage to fortune by pledging to scrap private health insurance (although Ms Harris appeared to qualify that pledge after making it during a televised debate in June).

Big differences also separate

them. Ms Warren can outsmart most economists. Ms Harris has yet to develop a memorable economic theory. The latter is charismatic. The former is professorially earnest. And so on. The point is that their gender barely features in these comparisons.

There will be another four women on the debate stage next week — Amy Klobuchar, Kirsten Gillibrand, Tulsi Gabbard and Marianne Williamson, none of whom has cleared 1 per cent in the polls.

Their failure to break through has as little to do with being women as the rising fortunes of Ms Warren and Ms Harris.

That is the Democratic party.

The perennial question is whether America as a whole is ready for a female president, let alone an all-women ticket.

Part of the answer is that it depends on which woman. It is hard to imagine Ivanka Trump, who harbours dynastic ambitions, being elected president. It is possible to see Nikki Haley, Mr Trump’s former ambassador to the UN, breaking through. There is an old quip about a man who is asked whether he believes in marriage: “That depends on whom I’m married to,” he replies.

Both Ms Warren and Ms Harris would beat Mr Trump in the popular vote according to polls, though by a slimmer margin than Mr Biden. www.businessday.ng

Technology: how the US, EU and China compete to set industry standards There is a first-mover advantage for whoever writes the new rules for the digital economy ALAN BEATTIE IN BRUSSELS

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he first wave of Donald Trump’s trade war on China, punitive tariffs on $250bn of its exports, rivals the brutal protectionism of the Depression. But at least supply chains for basic goods and commodities can be reestablished relatively quickly once the barriers are removed.

Phase two of the president’s campaign — citing national security imperatives to try to drive Chinese companies like Huawei out of tech supply chains — could leave a much longer-lasting mark.

Mr Trump’s move is a massive escalation of the struggle that has endured for years between rival companies and governments in the US and China to control the standards and technologies of the digital economy. The battlefront of that conflict now stretches from establishing market dominance to setting industry standards to influencing regulation.

But the US and China are not the only players in the game. Despite its underpowered tech sector, the third great trading power, the EU, has big ambitions as a rulemaker. European officials are quietly confident that, as with the “Brussels effect” whereby EU rules on cars, chemicals and food have been adopted around the world, so its regulatory process will play a large role in shaping the global digital economy.

In the same way that EU emissions standards encouraging the production of electric cars have helped Tesla more than they have VW, the EU could end up providing the standards for an international data realm without making many products itself.

Competition over technologies and standards has become intense, and China in particular seems intent on creating a “Beijing effect” to replace the old Brussels version. A report last year on the

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internet of things for the US-China Security Review Commission, a hawkish body mandated by the US Congress, said bluntly: “China sees technology development as a decisive strategic resource and believes other countries’ control of key technologies is a significant strategic liability.” Beijing’s effort to influence and set international standards, it concluded, was “a critical part of China’s ambitious state-directed plan to achieve dominance”.

In modern trade, first-mover advantage in setting standards and rules can give a powerful edge to companies and businesses. With its company executives working in close alliance with government, China has adopted an aggressive multipronged strategy to push its standards globally.

An EU official says that China learnt from the experience of 3G, when it created its own standard which was used by no one else, losing advantage in innovation to the US and the EU. “This time round they have realised they cannot cut themselves off from the world,” the official says.

Through sheer size of population — together with lavish subsidies, supportive regulations and the exclusion of foreign competitors — the Chinese government has deliberately created a domestic mass market in areas such as autonomous vehicles, bike-sharing, payment systems and facial recognition. An aggressive export drive helps to establish its technologies abroad.

Ren Zhengfei, the founder of Huawei, told the FT this month that it was seeking dominance in the internet of things sector, using China’s large manufacturing sector to develop chips and software for companies to connect factory floors to the internet. “If everyone were to vote for an IoT standard, they would vote for our standard,” he said. “Qualcomm [Huawei’s US rival] hasn’t done much work in the IoT sphere and we’ve done a huge @Businessdayng

amount of research.”

Market dominance often works in alliance with a bureaucratic offensive. China’s government and companies have made aggressive moves to extend their influence in bodies such as the International Telecommunication Union, a Geneva-based organisation made up of industry and official representatives that sets standards in telecoms, and in the International Organisation for Standardisation, which does similar across a wide variety of technologies. The ITU now has a Chinese head and representatives from the country sit on several key committees. Chinese companies also participate in industry bodies such as the US-based Institute of Electrical and Electronics Engineers, which creates specifications for technologies such as wireless and integrated voice/data systems.

Beijing often uses such bodies as a way to promote standards it has established at home with little foreign input. In artificial intelligence, for example, it has developed standards in the China Electronics Standardisation Institute, part of the Ministry of Industry and Information Technology. It has since attempted to promote its model, which was developed in a separate white paper, in the ISO committee on AI. Xiaomeng Lu of Access Partnership, a tech-focused public policy consultancy in DC, says China employs a “carrot and stick” strategy to deal with foreign players in standardisation — “mostly carrots in global environments and mostly sticks in domestic standardisation processes”. In international standards organisations, Ms Lu says, Chinese officials offered business deals under the table to foreign companies in exchange for their votes on Chinese technical proposals. But when setting its own standards, Ms Lu says, China uses the stick on foreign companies, often excluding them from discussions.

Thursday 25 July 2019

BUSINESS DAY

www.businessday.ng

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@Businessdayng

49

industry Insight

BUSINESS DAY Thursday 25 July 2019 www.businessday.ng

Does backward integration make sense for manufacturers?

ODINAKA ANUDU& GBEMI FAMINU

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ackward integration occurs when a company buys its suppliers or internally produces segments of its supply chain.

A number of Nigerian manufacturers have acquired previous firms which supplied inputs to them or begun production of part of their supply chains.

The concept has become popular in Nigeria today because of the need to source inputs or raw materials locally, rather than import them.

While it is mainly done by the private sector, it has become a public or government policy melody aimed at sustaining favourable foreign exchange, boosting local capacity, creating jobs, enhancing skill acquisition and reducing the importation of raw materials.

The key question, however, is, does it make sense for Nigerian manufacturers?

The answer could be in the affirmative or in the negative.

While fiscal and monetary authorities often emphasise backward integration, the fact they ignore is the financial outlay required to start it. In sugar, for example, Dangote, BUA, Flour Mills, Confluence Sugar and other investors have pumped over $1 billion in land acquisition, nursery plantation and acquisition of expensive equipment used in raw sugar processing.

Santosh Pillai, managing director of PZ Wilmar, told BusinessDay that the company had invested $150 million in oil plantations in Cross River State alone.

PZ Wilmar, a subsidiary of PZ Cussons, has almost 26,500 hectares of palm oil plantations in Cross River State. About 5,549 hectares (ha) of oil palm plantation are located in Calaro Estate, while 2,369 ha are in an area known as Calaro Extension. The firm also acquired Ibiae plantations with 5,595 ha; Ibad plantations in Akampa with 7,805 ha; Kwa Falls in Akampa Akpabuyo with 2,014 ha, and Oban plantations, also in Akampa, with 2,986 ha. PZ Cussons has completed two palm oil processing plants in the Calaro Estate. Only a company with a financial muscle will take this kind of risk.

Secondly, to establish a backward integration project, manufacturers acquire land, which costs a lot of money. In some cases, the plots of land go into contention, leading to litigations that last for years.

For instance, BUA acquired 15,000 hectares of land for the purpose of nursery plantation and final sugar production at Lafiagi in Kwara State. It took the company eight years to use the land owing to community land cases.

An importer bringing in finished sugar within this period would have been a billionaire, while the manufacturer would be struggling to start.

Nigerian manufacturers borrow billions to go into backward integration. Many of them get loans at 20 to 35 percent to go into these projects at commercial banks, promising to pay back in one to three years.

In some cases, their investments at taken over by debtors when they are incapable of meeting their obligations.

Importers, however, do not suffer such fate. They import, pay duties and face the

market squarely.

More importantly, some inputs in Nigeria do not always meet the anticipated standards of manufacturers, especially multinationals.

Rather than rely on such inputs, manufacturers ignore local suppliers for another market.

Once upon a time, cement makers ignored locally available gypsum and limestone to import them. It was not in the news because only few Nigerians understood the economics of that.

Firms are not necessarily set up to create jobs. Shareholders must get their dividends. Workers must get their salaries and all other stakeholders must get what is due to them. So, should manufacturers backward integrate when it makes sense to import? Analysts argue that manufacturers must be allowed to choose the best option that will keep them afloat.

However, many Nigerian companies think that backward integration is better for them. The biggest reason is that it saves them time and resources needed to seek foreign exchange during crisis similar to that of 2016.

In August 2016, the Manufacturers Association of Nigeria (MAN) and the NOI

Polls reported that over 50 manufacturers and 222 small-scale businesses closed shops, leading to 180,000 job losses.

This happened because oil price drop meant low dollar inflows, translating into little dollar availability in the FX market.

To avoid such situations, Nestlé Nigeria, a top player in the fast-moving consumer goods industry, has done huge investments in backward integration of sorghum, millet, soya, cassava starch, cocoa powder, and palm olein.

Nestlé Cereals Plan project has over 30,000 farmers who supply 100 percent of the grain requirement for Golden Morn Maize. Through its Sorghum and Millet in the Sahel (SMS) project, now called Nestlé Nigeria & IFDC / 2Scale Project Sorghum & Millet, the food and beverage giant has engaged over 10,000 farmers.

Nigerian Breweries (NB), the country’s biggest brewer, is getting sorghum locally to replace barley.

The brewer also needs processed cassava (starch), having entered into an arrangement with local farmers for constant supply of it. One of such partners is Psaltry International Limited, based in Alayide village, Ado Awaiye near Iseyin, Oyo State.

The cassava processing firm has today

become the biggest revelation coming out of the backward integration story.

Oluyemisi Iranloye, MD/CEO of the firm, said in 2017 that the firm had created a supply chain of up to 5,000 farm families, including more than 2,000 registered and unregistered out grower farm families, marketers, transporters and retail input suppliers.

Nigeria’s biggest flour miller Flour Mills of Nigeria Plc has its own farms and engages local farmers to work as partners.

It, therefore, sources local raw materials from its own farms.

Its subsidiary Agri Palm Limited located at Iguiye and Ugbogui near Benin City (with 4.500 hectares of oil palm plantation) supplies palm oil, olein and other by-products of palm oil to the group.

Another subsidiary— Agro-allied Syrups Limited—which has cultivated 800 hectares of cassava in Shao, Kwara State, in the last 16 months, supplies starch to the group. Some of its wheat flour is sourced from northern Nigeria.

Unilever, a FMCG firm, sources palm oil for its BlueBand and soaps. The company is also getting local herbs and spices for its seasoning cubes.

Under its ‘Partner to Win’ initiative, it partners local farmers and intermediary companies to source inputs.

“Already, we have achieved over 90 per cent in local sourcing of packaging materials. The aim is to achieve 100 per cent by the end of 2019 and overcome the current challenges of local vendor’s capacity to meet up with global standards. In agroallied sector, Unilever is partnering with intermediary companies, for the supply of cassava and starch,” Thomas Mwanza, procurement director for Unilever West Africa, said recently.

Promasidor Nigeria Limited, makers of Cowbell Milk, Loya Milk, Miksi Milk, Onga seasoning, and Top Tea are also sourcing some of its inputs locally. It recently unveiled Nigeria’s first zip-lock packaged ready-to-go cereal.

Anders Einarsson, managing director of Promasidor Nigeria, said recently that 75 per cent of the product’s inputs are sourced locally. He added that the decision to look inward for raw materials was informed by the company’s desire to contribute to the growth of agricultural value chain.

“The raw materials of SunVita are about 75 per cent sourced locally. This demonstrates our commitment to backward integration and local capacity utilisation in line with the economic need of the country,” he said.

Experts say backward integration by manufacturers, when done sustainably, will not only create a number of value chains and jobs, but will also bring huge foreign exchange and development.

Local input sourcing is rising, showing that it makes sense for many manufacturers. It was 60.29 percent in 2018 and 63.21 in 2017.

Many more manufacturers believe backward integration will be cheaper for them in the long run. But they want to see good and stable policies, convenient operating environment, cheap funds, harmonised taxes, and quick out-of-court resolutions of land cases.

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Advert Hotline: 08034743892. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Patrick Atuanya. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.