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NEWS YOU CAN TRUST I **WEDNESDAY 27 FEBRUARY 2019 I VOL. 15, NO 255 I N300

APC, PDP take battle to National Collation Centre, object to results in some states ... opposition calls for stoppage of collation of results ... as Obi alleges voter disenfranchisement in Anambra, S/East JAMES KWEN, OWEDE AGBAJILEKE, Abuja, DIPO OLADEHINDE, BUNMI BAILEY, Lagos, & EMMANUEL NDUKAUBA, Awka

he ruling All Progressives Congress (APC) and the main opposition People’s Democratic (PDP) on Tuesday took the battle over who emerged victorious at last Saturday’s Presidential election to the National Collation Centre, Abuja, where the final result is being collated. From the results announced so far by the Independent National Electoral Commission (INEC), Muhammadu Buhari of the APC is leading Atiku Abubakar of the PDP, but the PDP on Monday rejected the results from some states. Osita Chidoka, PDP National Continues on page 34

Inside UNFPA accused of plagiarism by a Nigerian researcher P. A4

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Buhari closes in on Nigeria victory Leads in 15 states with 11.2m votes Atiku trails by over 2m Stocks fall 0.7%

LOLADE AKINMURELE

igerian President Muhammadu Buhari led his main challenger, Atiku Abubakar, by a 57 percent to 43 percent margin Tuesday, according to BusinessDay calculations. That’s after results from 27 states and the Federal Capital Territory were announced by the Independent National Electoral

Commission (INEC), with final results expected Wednesday. Buhari leads by a margin of 2.7 million votes and has won 15 states, two more than Atiku. So far, the results announced are not exactly what analysts, who had forecast a tight race between Buhari and Atiku, expected. While Buhari has secured a total of 11.2 million votes as at press time, Atiku has 8.5 million votes. Buhari was declared winner

by INEC in Bauchi, Ekiti, Gombe, Jigawa, Kaduna, Kano, Katsina, Kogi, Kwara, Lagos, Nassarawa, Niger, Ogun, Osun and Yobe States. Atiku, on the other hand, won in Abia, Adamawa, Anambra, Benue, Edo, Ebonyi, Enugu, FCT, Imo, Ondo, Oyo, Plateau and Taraba States. Stocks fell 0.7 percent while the government’s benchmark ten-year bond fell 0.05 percent Tuesday, as investors digested

Buhari’s imminent win. The currency was stable at N361/ US dollar at the Investors and Exporters window, according to FMDQ data. Local and international analysts had said Nigerian equities and bonds would probably rally if Atiku, who is considered to be more market-friendly by investors, wins. However, the 72-year-old Continues on page 34

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Surprise, shock trail outcome of Presidential, NASS polls ZEBULON AGOMUO & INIOBONG IWOK

s the results of the Presidential and National Assembly elections held last Saturday are being announced by the Independent National Electoral Commission (INEC), Nigerians are being treated to a gale of surprises from various parts of the country. From Abia to Edo, Kwara to Yobe and Bornu States, there is no end to the surprises. The massive victory recorded by the All Progressives Congress (APC) in Kwara State, where Senate President Bukola Saraki of the People’s Democratic Party (PDP) lost his return bid to the Senate, sources says, has sent shock waves into the minds of many observers, particularly those who are not from the state. Ibrahim Oloriegbe, senatorial candidate of the APC, polled 123,808 votes to defeat Saraki, who got 68,994 votes. Also in the presidential election, President Muhammadu Buhari of the APC won the state, scoring 308,984 against Atiku Abubakar of PDP’s 138,184 votes. The outcome of both elections came as a surprise to many political observers who had predicted PDP victory at all levels in the state. Some, however, are not surprised following recent increasing resentment against Saraki’s dominance of the political scene in the state signposted by the recent local government election in the state where APC swept the votes. “Many people in Kwara are becoming wiser. Unlike before when they asked no questions but just ‘follow follow’, today, they have

woken up from the slumber and are reviewing their benefit of many years of loyalty to the Saraki family. If you visited Kwara during the campaigns, the serial defeat suffered by the PDP in the state would not have been surprising,” a source told our correspondent. In Oyo State, Governor Abiola Ajimobi did not only lose his bid to go to the Senate, the APC also lost the presidential election there. An analyst, who spoke on condition of anonymity, said there are many reasons why the APC lost in Oyo and may likely lose the governorship if care is not taken. “One, Ajimobi tampered with the traditional institution in the state. During his faceoff with the Olubadan, the governor took some decisions that were considered abominable in the tradition of the people. To humiliate the Olubadan, he elevated some chiefs to the position of Oba. These Obas have no territory to preside over. The aim is to ensure that the people are no more submissive to the Olubadan. Now, the new Obas are saying, ‘We too are also Obas, so why must we respect the Olubadan?’,” the analyst said. “Two, the governor also sees Ibadan as the beginning and end of Oyo State. Despite the number of universities and other institutions of higher learning in Ibadan, the state capital, he also sited the state university there. He did not consider it appropriate to site the institution somewhere else. So, the people said, ‘This man, we don’t want you again.’ They trooped out to vote and defended their votes,” he said.

Continues on page 34

Widespread voter apathy in Saturday’s polls underpins citizens’ discontent with governance CHUKA UROKO

side from the violence and large-scale electoral fraud that characterised the February 23 Presidential and National Assembly elections, the polls also witnessed widespread voter apathy across the country. A number of foreign observer missions to Nigeria for the 2019 general elections, including the European Union Election Observation Mission (EUEOM), the Commonwealth Election Observation Mission, the African Union Election Observation Mission (AUEOM), among others, on Monday expressed misgivings over the conduct of last Saturday’s Presidential and National Assembly elections. The observer missions raised concerns about operational shortcomings on the part of the Independent National Electoral Commission (INEC), delays and malfunctioning of smart card readers in some parts of the country, reduced confidence in the electoral process, violence recorded during the elections, among others. But there was also widespread voter apathy, which political analysts say arose out of voter intimidation and electoral violence, as well as the lastminute postponement of the election from February 16 to February 23. Analysts say the poor voter turnout is a reflection of citizens’ discontent and disconnection with governance at all levels. Though this comes with grave

implications for the citizens, the truth remains that a large number of Nigerians are excluded from what is now termed ‘dividend of democracy’ as they have nothing to show as government presence or impact on either their lives or their businesses. “Why should I waste my time to vote for somebody who will not, on getting into office, remember or think of me; somebody whose actions, programmes or policies will not have any direct impact on my life, those of family, or my business?” queried a young man, who chose to play football with numerous others on the election day, in response to a question posed by BusinessDay. The young man, a businessman who introduced himself as Christian Ejiofor, may have spoken the minds of many other Nigerians, young or old. And this is at individual level. Though the results of the presidential elections received so far show that the voter apathy cuts across many states of the federation, a closer look at the results also reveals that it is more pronounced in a certain section of the country, the South-East region. Notwithstanding that Peter Obi, a South-Easterner, is a major stakeholder in the election as a vice presidential candidate on the platform of the main opposition People’s Democratic Party (PDP), voter apathy was quite obvious in Anambra State, as reflected in the results of the polls in the state.

•Continues online at www.businessday.ng

Wednesday 27 February 2019

L-R: Ahmed Rufai Mohammed, president and chairman, governing council, Institute of Directors Nigeria (IoD); Kene Nwanegbo, assistant director, legal and corporate services; Ije Jidenma, second vice president; Dele Alimi, DG/CEO, and Chris Okunowo, first vice president, during the courtesy visit of IoD board members to BusinessDay head office in Lagos, yesterday. Pic by David Apara

Concerns on economy heighten as result collation drags TONY AILEMEN, HARRISON EDEH, OWEDE AGBAJILEKE & INNOCENT ODOH, Abuja

he lull in economic activities occasioned by delayed elections as well as the protracted collation of results has become a source of serious concern for industry watchers. The Presidential and National Assembly elections, which were earlier scheduled for February 16 but later shifted by one week, caused loss of billions of naira to the economy, according to some estimates. This worrying situation has been heightened by the fact that the results of the presidential election are still being collated three days after a poll that was largely marred by violence and voter intimidation. “Investors cannot take firm decisions, while businesses are either stalled or slow. As a large economy, we need to embark on outright full-

proof electronic system that will enable Nigerians to vote from wherever they are, either outside the country or within, without shutting down their businesses in order to move to locations where they registered to vote,” Chijioke Ekechukwu, a former director-general, Abuja Chamber of Commerce and Industry, told BusinessDay. “If the elections had been fully electronically executed, results should have been out 24 hours after election. The technology to achieve this exists, and we need to start working on it now,” Ekechukwu said. While the lull in economic activities has been on for two weeks running, governance has also been pushed to the back stage, further slowing down activities in an economy that has been struggling to rebound after a recession. In the last two weeks, the everbusy Presidential Villa has remained

somewhat quiet as President Muhammadu Buhari’s retinue of cabinet minister and aides were dispatched to their constituencies to support the President’s re-election bid. This has left many issues unattended to as the seat of power and the nation’s policy engine house shifted focus to election activities, including rigorous campaigns. President Buhari, who returned to Abuja on Monday after voting in Daura, Katsina State, practically met an empty Villa, BusinessDay gathered. Most of the Villa staff were yet to return from where they went to vote. “There has been anxiety on the outcome of the elections with some business working under-capacity and some schools still closed,” said Tony Ejinkonye, national vice president, National Association of Commerce, Industry, Mines and

Continues on page 34

Big oil’s financing barricades may hold growth opportunity for NOCs STEPHEN ONYEKWELU

ational oil companies like the Nigerian National Petroleum Corporation (NNPC) may reap benefits created as a result of changing shareholder and investor landscape that demands significant reduction in net carbon footprint from big oil companies. An increasing number of shareholders are using their rights as partial owners to influence the investment decisions of International Oil Companies (IOCs) in favour of renewable sources of energy. In addition, institutional investors now have global warming policies that discourage further investments into fossil fuels, and lobbyists such as non-governmental organisations are boxing IOCs into a small corner, severely restricting the supply of funds. “Investors have forced Dutch oil and gas major Shell to officially change its strategy, investing in more renewable energy and energy storage,” said Cyril Widdershoven,

a long-time observer of the global energy market. Widdershoven said this is already the reality and that a growing amount of smaller oil and gas companies have become insolvent, partly caused by “global warming constraints” and lower oil prices in general. The first casualties are falling in Europe, mainly the United Kingdom, where 16 companies went bankrupt in 2018, in comparison to zero in 2012. BP made a series of investments in electric vehicle technology and infrastructure in 2018 that significantly moved its advanced mobility agenda. This included the purchase of Chargemaster, operator of the UK’s largest vehicle charging network, as well as venturing investment into battery company StoreDot. Total Plc’s adjusted net operation for gas, renewables and power segment was $756 million in 2018, thanks, notably, to the good performance of liquefied natural gas (LNG) and gas/power trading activities. The acquisitions of Direct Energie and the LNG business of Engie account

for the increase in investments to $3.5 billion in 2018. This means state-owned oil companies like NNPC have a chance to take advantage because they are not constrained by shareholder activism or NGO pressure. They are also the real owners of the overwhelming majority of hydrocarbon reserves in the world. But national oil companies are faced with a different set of challenges. “The time for oil is up. It will fade away in the coming decades. Of course, it will not be done in a day. It will take time,” Keun Wook Paik, senior research fellow at Oxford Institute for Energy Studies, told BusinessDay in an emailed note. The International Energy Agency, a Paris-based energy think tank, has said major oil and gas exporters have weathered many upheavals in recent decades but a renewed commitment to reform and economic diversification will be vital to cope with the changing dynamics of global energy.

•Continues online at www.businessday.ng

Wednesday 27 February 2019

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LCCI canvasses patronage of local products to boost manufacturing sector ODINAKA ANUDU

agos Chamber of Commerce and Industry (LCCI) wants government agencies and parastatals to patronise made-in-Nigeria products to boost the country’s productive sector. The chamber says locally-made products are faced with numerous challenges such as high cost of bringing in raw material and harsh operating business environment. It laments that these problems are worsened by absence of patronage by government agencies, which are the highest spenders in the economy. Babatunde Ruwase, president, LCCI, at the inauguration of its Printing, Publishing and Allied (PPA) group in Lagos, said with the inauguration, the chamber would be able to focus more on issues hindering growth of the sector while addressing issues of raw material and backward integration. “We have some facilities in Nigeria which have all gone moribund,” he said. “We will also seek ways on how the federal government will patronise local publishing and printing companies.

It is also like a focus group that will pay attention to challenges affecting their sector.” He said government must consider local publishing and printing companies as the first choice when doing businesses. “The earlier we get government to patronise publishing and printing companies, the better for the sector and the economy at large.” He said, according to the Nigeria Bureau of Statistics (NBS), the size of the printing and publishing sector was N20 billion in 2018, pointing out that the sector was one of the fast-growing sectors in Nigeria with a Gross Domestic Product (GDP) growth rate of about six per cent and 0.03 percent in 2018. “In response to the importance and performance of this sector, the chamber decided to create this group and we are very happy to identify with all the members of this vibrant group today,” he said. Also speaking at the event, Layo Okeowo, chairperson of the PPA Group, said the segment would give operators in the sector a viable platform to engage government on key policies

affecting the sector and exchange ideas on the growth and development of the sector. “Repositioning our industry to add immense value to our economy, which is said to have the capacity of attaining a value of $1 trillion by 2025, is out aim.” “It is on record that this group has not been enjoying deserved patronage from various governments, Ministries Departments and Agencies (MDAs),” she said. She lamented that most of the jobs, which should have been provided for local printers and publishers were taken overseas, stating that the time to engage the government and other stakeholders on issues affecting the sector was now. She said local printers and publishers still had to depend on importation of papers due to the absence of paper mill in the country that could produce the required quality. “Based on these painful realities, I am strongly persuaded that the time is ripe for printers and publishers to team up and establish a paper mill in the country to manufacture the quality papers that are required,” she said.

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Wednesday 26 February 2019

Nigeria, Pakistan, Togo, Zimbabwe, others rank among world’s most complex markets BUNMI BAILEY

igeria, Bangladesh, Mali, Pakistan, Togo and Zimbabwe have been placed among the countries with the highest complexity in market, operational, and regulatory, according to a 2019 Global Markets Complexity Index (GMCI) report. The GMCI report was developed by Wilson Perumal & Company, a leading international management consulting firm in partnership with the Wall Street Journal, a U.S. business-focused, English-language international daily newspaper based in New York City. It assessed 83 countries across 31 measures of market, operational, and regulatory complexity, and places them into eight country groups with distinct complexity profiles. Nigeria, Zimbabwe, Pakistan, Bangladesh, Mali and Zimbabwe were categorised in the eighth group called “Only the Brave” where they had a low score of 0-39, which indicates a high degree of complexity in market,

operational, and regulatory processes. “‘Only the Brave’ includes the most complex countries in the world. These countries have the highest market, operational, and regulatory complexity in the GMCI. However, this complexity is better characterized as growing pains than a terminal illness,” the report stated. The report further stated that some of these countries are simply in a rapid development phase, with quickly changing regulatory environments, consumer preferences, and operational challenges and over time, they will likely gain control over this complexity and improve the business environment. The scores on a scale from 1 to 100, shows where 1 represents the most complex country and a score of 100 represents the least complex country Nigeria ranked in 76th, 78th and 80th in market complexity, operational complexity and regulatory complexity, respectively. Vivian Alozie, an equity research analyst at Capital Bancorp plc said that there are a lot of regulations that

are preventing companies in Nigeria from reaching their potentials and also gaining access to the resources that they require to scale up. “For example on the Nigerian Stock Exchange (NSE), the listing requirements for companies are cumbersome and it is still an obstruction for companies that may wish to get listed and tap into the wealth,” Alozie said. For example our manufacturing sector is still struggling to attract Foreign Direct Investments (FDI), which is one of the economic bedrock for development. And we need more FDI to allow other sectors of the economy to grow,” Alozie said to BusinessDay in a telephone interview. Ibrahim Tajudeen, head of research, Chapel Hill Denham, in his own opinion, said the regulatory processes was a major factor and that we need to improve on our regulatory processes of doing business in this country. “And this applies to not only new but also existing businesses. For you to attract more foreign investments you need accommodating regulatory processes.

Visa announces Fintech Fast-Track Programme in CEMEA CALEB OJEWALE

isa Inc. has announced it is expanding its Fintech Fast-Track Programme in the Central and Eastern Europe, Middle East and Africa (CEMEA) region as part of its efforts in developing the next generation of digital payment solutions. Already rolled out in Europe, Latin America and Asia Pacific, the programme, according to Visa, provides innovative fintechs with a faster and easier integration process with VisaNet, Visa’s global network, in addition to a suite of tailored digital solutions and growth capabilities. With the Visa Fast-Track Programme, fintechs based in CEMEA can now onboard to Visa’s global network in as little as four weeks. The program has been tailored to the needs of fintechs, adapting to their realities and providing them with processes that are faster, which include reducing the number of on boarding conditions. The programme also links fintechs to platforms that are already certified by Visa and connects fintechs to sponsoring banks, providing fintechs with scaling opportunities through Visa’s global network. Andrew Torre, regional president, CEMEA, Visa, describes the payments ecosystem as one that is evolving at

an unprecedented pace with some of the most exciting innovations coming from our region. He says Visa is actively engaged with passionate, entrepreneurial communities to understand where synergies exist in order to foster and bring new experiences to life in a secure and scalable manner in its pursuit of a digital future. “Our aim is to connect new players and ideas with our network partners, so that we can deliver intuitive and relevant payment, banking and retail experiences to customers and merchants,” Torre says. The Fintech Fast-Track Programme provides a new commercial framework that includes access to Visa’s payment capabilities, reduced fees and streamlined processes. After successful launches in Europe, Latin America and Asia Pacific in the second half of 2018, the program is now available to fintechs in CEMEA. In sub-Saharan Africa, Visa says it will work with Global Technology Partners (GTP), to design and enable turnkey end-to-end packaged solutions jointly for the Visa Fintech Fast Track Programme. The enterprise solution will include bin sponsorship, issuer-processing services, acquirer QR code processing services and programme management services.

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End the recession (sorry election) and let our lives begin Small Business handbook

Emeka Osuji

i g e r i a n s, c o r p o rate and individual, are currently going through what some Christian clergy would call desert experience – that period in the life of believers when they go through mortification, either thrust upon them by the church or personally and willingly imposed by them to purify themselves and get closer to God. During desert experiences, or what is also sometimes called purgatory experience among some denominations, the individual is expected to joyfully endure every hardship or pain that comes their way. And they are usually many and largely self-inflicted. Self-imposed desert experiences often involve the individual moving away from their cosy homes to a “desert or mountain” – barren place where there is no comfort or luxury, in order to suffer and practice endurance. Things could get so difficult and rough,as the demands of the flesh presses hard on a soul that is weakened

by deprivation that the individual may be tempted to quit. But desert experiences are believed to help the concerned individuals to purge themselves of the worldly desires and to focus on the heavenly things, pray more and stay away from carnality. So nobody quits. That kind of experience happens on a regular four year basis. Our four yearly desert experience is one occasioned by elections. In Nigeria, election times are like periods of recession, during which time companies and even individuals look back at their past years of profligacy and shudder. As they tighten their belts the rain curses on the spirit or whatever made them fritter away such valuable years. Is there really much difference between the slowing down of economic activity that defines a recession and the practical shutdown of economic activity that defines elections in Nigeria? This political recession and the slowing down of business activityhas become a part of the Nigerian system’s trade mark during elections? Perhaps,there is little or no difference because both phenomena manifest similar symptoms – avoidable hardship. The only difference is probably in the length of the slowdown. The slow down occasioned by elections is usually much longer because it creeps in on us when nobody is looking and before the hurt is felt several months have passed. Once politicians stop worrying about

their constituency allowances and intensify their nocturnal meetings about the third year of a given term, then business must look for its night gown. It is time to go to bed and sleep – the kind of forced sleep one finds in students’ hostels where one must be in bed whether one wants to sleep or not. Some call it prep. Nigeria recently experienced a short-lived recession. By its shortness and the way it vaporized, without any significant reduction in the other malaise that still plague the system, such as unemployment and inflation, many have argued that the recession was, in the first instance, a mistake or the product of some economic carelessness we exhibited. During the recession, business slowed, particularly for the self-employed and the informal sector operators. Cash flow practically dried up as orders and commitments fizzled out. The handto-mouth economy, which best describes the economy of the average Nigerian family, entered a wilderness experience.In a recession, the economy goes into reverse gear, highly irritable, shedding weight, spewing out otherwise critically valuable factors and contracts for a prolonged period of time. Inventories pile up and sales dwindle. At the same time, disposable incomes take a nose dive leading to further cuts in consumer spending. which probably initiated the economy’s contraction in the first instance? That is what is going on as the

‘

In Nigeria, elections have been elevated to a do-ordie battle, where people leave their preoccupation to play thugs for politicians

general elections rage. Nigerians cannot wait to go back to work. In all respects, it is only the politicians that have really been working. In Nigeria, elections have been elevated to a do-or-die battle, where people leave their preoccupation to play thugs for politicians. And many end up building houses or buying property just by being thugs. This is a culture that is fast spreading and must be checked. Business people are usually the first to cry out when the economy slows down, for any of many reasons. With the recent recession and the regularity of general elections, it appears that Nigerians are on a musical chairs experiment of recessions, going in and out of it. The past few months have been very difficult for many people, especially the self-employed. The only kind of business that seems to have some life at this time is in the advertising and publicity field. By their very nature, politicians are loud and dishonest people. They want to make their voices heard, even if the story they tell is a lie. Well, put more charitably we may say that by the nature of their trade, politicians are forced to lie or keep the truth hidden lest their opponents get to know and block their moves. Nigerians and waiting patiently to end this nightmare and have their lives back. Dr Emeka Osuji is head of the department of Economics at Pan Atlantic University Lagos. eosuji@pau.edu.ng @Emyosuji

The heart and our health Iyke Odo

here is a lingering controversy about the chicken and the egg. The question is, which takes precedence over the other? Which is more significant? The world has not resolved that puzzle. When we say the egg, the other question becomes, what gave rise to the egg, and vice versa. Life indeed, is a mystery. The human heart, the brain, the liver, the kidneys and the lungs seem to fall into the above bracket. The question is which is the most essential. Without any of them, there will ultimately be no life. The consequence of not having any of them may be more instantly felt but the ultimate reality is that life cannot be sustained without any of the five organs. The mystery behind the heart and life itself Life begins as a unicellular cell (The Zygote), with the coming together into homogeneous unification of the male sperm cell and the female egg cell. Progressively, this cell continuously and consistently subdivides and multiplies and differentiates into the multi-cellular stage, (The embryo). Initially, no part of the dividing tissue has form or shape

or activity. But suddenly, just suddenly, a part of the inactive structure of less than onecentimetre size embryo begins to vibrate at about 4 – 5 weeks of conception. This vibrating site is what will eventually become the human heart. It starts beating as early as 4 – 5 weeks of life and continues uninterruptedly until the birth of the baby and for as long as the man lives on earth. This activity is the earliest indicator of life in the developing embryo and the evidence of life in later time. The heart is so significant to life that if it stops for just 6 minutes, biological death occurs. Clinical death occurs immediately the heart stops pumping blood. If the heart stops, clinical death occurs but if Cardiopulmonary Resuscitation (CPR) is commenced within 6 minutes, the heart can be revived to start pumping again and brain death prevented. Clinical death is reversible, brain death is not. Cardiovascular diseases are the number one cause of death worldwide. On average, more than 17 million people die from heart related illnesses every year. This is more than that of people who die from HIV, malaria and cancer put together. Hypertension is a major cause of cardiovascular diseases especially, when poorly managed. It is usu-

ally referred to as the silent killer. It is so referred because, often times, even at dangerously high, life threatening levels, it may not reveal signs and symptoms. In the absence of signs and symptoms, patients with hypertension are unlikely to be diagnosed early and those diagnosed may not be committed to their treatment, being that they perceive no threat to their lives. Either way, it raises the chances of both mortality and morbidity. Hypertension typically develops over many years and affects nearly every organ eventually. Fortunately, it can easily be detected and once you know you have high blood pressure you can work with your doctor to control it. Uncontrolled high blood pressure is the challenge, not the high blood pressure. It increases the risk of serious health problems such as stroke and heart attacks. How can we maintain good heart health? Our lifestyle defines who we are. The food we eat today is the medicine or disease of tomorrow. Right eating is about eating the proper food at the proper time and in the proper quantity. This way, food is medicine; otherwise, it is the disease of tomorrow. Most of man’s diseases are due to wrong eating. For above 40s, take less carbohydrates, more greens in vegetables and

fruits. Drink at least 8 glasses of water a day. Avoid soft drinks or bear after a meal. Moderate or no alcohol is advised, Low salt diets, and no tobacco. One of the greatest challenges of healthy living is sedentary life. Active, frequent and regular moderate aerobic exercise is a great life tonic that adds value to every quality of life. The stress level in the air is massive and emotional stability is key. We must learn to be slow to anger and quick to quit. We must learn to let go and to forgive. Find a strand of happiness in all things. We must learn to work, then, rest to work and understand that the best form of rest is sleep. Believe in God and trust His word. Every beat of the heart is evidence of life and every such beat rejuvenates health. Our lives depend on our hearts. Let us protect our hearts to protect our lives. Know that whatever makes you happy, whatever makes you relaxed, whatever gives you a sense of goodness makes the heart healthy and makes our lives beautiful. Dr.Odo is the Medical Director at Meridian Hospital Port-Harcourt. This isan Extract from his article published in Afristructure Magazine – A GambetaNews. com Publication

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Dapo Akande

efinition of corruption. Yes, as ludicrous as it may have appeared to most of us, President Jonathan was absolutely right when he said corruption is not synonymous to stealing. Stealing is to just take what doesn’t belong to you whereas corruption requires the cooperation of another party to give you an unfair advantage, for you to make a gain of some kind. Of course that willing party more often than not is motivated to cooperate because of what he too stands to gain. This could be in the form of a bribe, a kickback or another form of unjustifiable benefit. It may all sound like semantics but that’s just the way it is. Corruption is to circumvent a process or system put in place for the common good, thereby ever so gradually, destroying it, just for your selfish interest. Corruption is to turn the spotlight on your perceived enemies while you turn a blind eye to the obvi-

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Corruption kills – part II Character Matters with Daps

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ous infractions and indiscretions of those you call your own. Corruption is to expect others to toe a line because it benefits you when then do but for you to exempt yourself, when it suits you do so. That’s why it has been said the greatest form of corruption is to make yourself an exception to something you prescribe or subscribe to. So for a policeman to extort the common man just for carrying a laptop, accusing him of being a 419, while making sure the investigation of a big man olé is conducted in a way that ensures it never sees the light of day is certainly the height of corruption. Just as governments disobeying court orders at will while enforcing the rule of law on others is equally corrupt. Corruption is totally anathema to justice. And the peace of a society devoid of justice is akin to that of a graveyard. This inevitably brings us back to a definition of character, which says a man of character will always desire to do that which is morally right, will pursue that which is morally good and because of his values will do what is right whether in private or in public. So an action which benefits the interest of the few to the detriment of the general public cannot be anything but corrupt, no matter how you try to spin it; even if you fancy yourself as a Naija style Robin Hood. Robin Hood was loved by the masses because he robbed from the rich to give to the poor. Robin Hood Naija style prefers to see the state as “no

man’s land” or a national cake where anyone who’s fortunate to get the opportunity is free to grab his own slice to enrich himself and take care of those around him. The truth is the state belongs to us all and it would have been better for you to leave that slice as that slice could improve the lives of millions rather than the tens you so graciously “blessed” with your largesse. The Naija style Robin Hood denies millions of the poor to enrich a handful of his friends and relatives and yet he’s celebrated as a hero. The real Robin Hood must be turning in his grave. There’s a reason why the forbidden apple eaten in secret always tastes so sweet and it’s always to destroy. It destroys the lives of those denied the joy of the commonwealth just as it entices but subsequently destroys the soul of the culprit too. That’s why the Bible warns us that “stolen water is sweet; food eaten in secret is delicious! But little do they know that the dead are there”. Plato, quite erroneously believed that an “educated” man would not only be wise but having mastered the art of reasoning, would also be “good” for “virtue” is knowledge; meaning moral uprightness is an automatic consequence of education. On the face of it, it may appear ridiculous but is it really? Should someone who has gone through the rigours of intellectual self development, with the aim of enhancing his ability to reason not

‘

So an action which benefits the interest of the few to the detriment of the general public cannot be anything but corrupt, no matter how you try to spin it

realize that serving his society as best he can is the surest guarantee for him in turn to benefit optimally from this society? Leaders of more developed nations who come together to ensure checks and balances are in place to checkmate tyranny and the natural human tendency to oppress are not stupid. Faithful to self preservation instincts as living beings, they know this is about the only way they can effectively safeguard themselves from oppression when the table turns, and others take over the reins of power. Especially when a Pharaoh comes who doesn’t know Joseph. So smart reasoning and the ability to look beyond the “now” speaks to the need to be good. Of course, Plato’s protégé, Aristotle soon disproved this theory with his assertion that even the best educated man could succumb to immoral tendencies due to what he termed “moral weakness”. He correctly observed that a morally weak person may well know the right thing to do but is too weak to resist doing wrong. The corrupt man is fully aware of the moral questions his actions may throw up but lacks the character required to resist temptation when it comes. Changing the nation...one mind at a time Akande is a graduate of the University of Surrey, UK, author of the acclaimed book: “The last fight: A personal journey to discovering values.” Contact: dapsakande25@gmail.com

What is wrong with the Nigerian code of corporate governance 2018? Joseph Onele

n Tuesday, 15 January 2019, the Vice President of the Federal Republic of Nigeria, Prof. Yemi Osinbajo unveiled Nigerian Code of Corporate Governance 2018 (the “NCCG 2018”). Prof. Yemi Osinbajo SAN, while unveiling the NCCG 2018 in Abuja, was reported to have assured Nigerians that the full implementation would promote corporate success and economic growth, lower cost of capital and help minimize wastage and corruption in the country. This article, however, is not so much about extolling the seemly ‘innovative’ provisions of the NCCG 2018 but to bring to the fore, some core issues that I believe are worth reflecting on and one of which I am of the considered view, could possibly and if proper care is not taken, make the NCCG 2018, in its entirety, be declared incompetent and/or invalid by a Court of competent jurisdiction upon its challenge, having in mind the history and seemly controversial background that predates the issuance of the NCCG 2018. The first issue for me is the reference to the enabling powers pursuant to which the NCCG 2018 was enacted and/or the Appropriate Issuing Authority, as alluded to in the body of the NCCG 2018. Issue one Propriety of the enabling powers pursuant to which the NCCG 2018 was Issued: In search of the appropriate issuing authority By Section 51(c) of the Financial Reporting Council of Nigeria Act 2011 (“FRC Act”) (which was also referenced in the NCCG 2018), the “Committee on Corporate Governance” is to “issue the code of corporate governance and guidelines, and develop a mechanism for periodic assessment of the code and guidelines. [Please note the emphasis on the word “Committee” and the operative word “Issue”]. Meanwhile, Section 8(g) of the FRC Act saddles the Financial Reporting Council of Nigeria

(“Council”) with the responsibility to:“monitor compliance with the reporting requirements specified in the adopted code of corporate governance.” By the same breath, Section 8(i) of the FRC Act empowers the Council to, inter alia“monitor and promote education, research and training in the fields of …corporate governance. [Kindly note the operative word “monitor” used in reference to the functions of the Council as it relates to the Code of Corporate Governance. Please note further that no where in above stated provisions is the word “issue” used]. Furthermore, while Section 8 of the FRC Act relates to the function of the Council, Section 11 of the FRC Act (which was referenced in the NCCG 2018) relates to objects of the Council, which inter alia, include to: “monitor and promote education, research and training in the fields of accounting, auditing, financial reporting and corporate governance.” [Please note again the use of the word “Monitor”]. The foregoing in mind, one could then understand my grievance when I looked at the introductory part of the NCCG 2018 and discovered the seemly feeble attempt by the FRC to cloth itself with the powers it never possessed in the first instance. Using as it were, the Honourable Minister for Industry, Trade and Investment as a ‘disguise’ for its glaring lack of vires to “Issue” the NCCG 2018, as opposed to allowing the relevant “Committee/Directorate” statutorily established for this sole purpose to achieve its statutory mandate and committing as it were, a ‘daylight statutory robbery’ by robbing the Committee or Directorate of Corporate Governance of its statutory responsibility as rightly provided for the lawmakers. By this singular act of the FRC, the FRC has passed off itself as seemly possessing more intelligence than the lawmakers who in their rightful wisdom and perhaps, to ensure proper checks and balances in the ‘issuance’ and ‘monitoring’ of the Code, deemed it fit to alienate the power to “issue” the Code of Corporate Governance from that of the responsibility to ‘monitor.’ For ease of reference, I have taken the liberty

to reproduce and highlight some of the wordings used in the NCCG 2018 itself, which I found quite instructive: “Sections 11c and 51c of the Financial Reporting Council of Nigeria Act confer upon the Council, the powers to ensure good corporate governance practices in the public and private sectors of the Nigerian economy and to issue the code of corporate governance and guidelines.” The above is quite incorrect! The Council lacks the power to ISSUE the Code of Corporate Governance!! The FRC Act vests the Power to “ISSUE” the Code of Corporate Governance ONLY in the “Committee/Directorate on Corporate Governance” NOT the Council itself!!! Interestingly, I authored an article in 2017 titled “The Financial Reporting Council of Nigeria and Her Misguided Regulatory Approach: A Classic Example of How Not to Be a Regulator” where I considered this issue. I recommend in particular, pages 12, 13 and 14 of the article which can be accessed here. The other part of the Introductory Section which relates to “Authority of the Code” of the NCCG 2018 which I found grossly misleading: “The Nigerian Code of Corporate Governance 2018 was approved by the Council pursuant to this authority and commended to the Minister for issuance in accordance with Section 73 of the Act” The above is very misleading! Section 73 of the FRC Act only relates to the power of the Minister to make regulations. The Code of Corporate Governance does not fall in the same purview as the Regulations contemplated under Section 73 FRC Act has specifically made provision for the way and manner the Code of Corporate Governance is to be made. Assuming arguendo (for the sake of argument) though without conceding, that the “Committee for Corporate Governance” means the same as the “Directorate of Corporate Governance” alluded to in Section 77 FRC Act, it is respectfully submitted that the Council would still lack the vires to “Issue” the Code of Corporate Governance as the Power to “Issue” the Code was never donated to the Council or even the Minister but to the Committee/Directorate

of Corporate Governance. Respectfully, it is submitted that ‘regulations’ provided for under Section 73 FRC are not the same as the “Code of Corporate Governance” specifically provided for in Section 51(c) FRC Act which in clear and unambiguous terms, empowers the “Committee on Corporate Governance” is to “issue the code of corporate governance and guidelines, and develop a mechanism for periodic assessment of the code and guidelines. In any event and assuming arguendo (without conceding) that the powers donated under Section 73 FRC Act includes the power to “Issue” the Code of Corporate Governance, it is respectfully submitted, on the on the authority of NECO v Tokode (2011) 5 NWLR (Pt. 1239) 45, where the Court of Appeal held that the provision in section 19 of the NECO Act 2002 being a specific provision in the Act, prevails over the general provision, and Olawepo v SEC (2011) LPELR-3598(CA), where the Court of Appeal, Per Nwodo, J.C.A also held inter alia that “...where there is specific provision to cover certain specified circumstances, there will be no need to import another legislation to support that statute,” the provision of Section 51(c) FRC Act, being a specific provision to the extent of specifically providing for the issuance of Code of Corporate Governance by the Committee/ Directorate of the Corporate Governance, will supersede the general provision of Section 73 FRC Act. Issue two(2): Matters arising on independent non-executive director (INED) Unlike Issue 1, issue two (2) does not affect the validity or otherwise of the NCCG 2018. It only seeks to make an argument (which could most likely be tagged as academic once the NCCG 2018 is declared incompetent or invalid by a court of competent jurisdiction, upon its challenge). Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng

Onele is a Legal Practitioner based in Lagos. He wrote via - thejosephonele@gmail.com

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Wednesday 27 February 2019

Dump the anachronism of analogue in a digital age in Nigerian elections

he electoral body had yet to announce the results two days after the elections pan-Nigeria as the Independent National Electoral Commission (INEC) battled with the anachronistic process it supervised for the national elections. Even so, citizens shared openly via electronic media the results from polling units and local governments while INEC made a show of “collation centres”. Those centres required their officials travelled thousands of kilometres nationwide to come to the federal capital physically. There were risks of accidents to lives and vehicles, as well as manipulation. In this part of our review of the 2019 elections, BusinessDay looks at the imperative of electronic voting arising from the failings of the semi-automated system deployed. The 2019 Nigerian General Elections displayed in stark relief the contradictions of Nigeria. Here is a country with highly developed electronic templates for logistics, data transfer and financial services built on a robust telecommunications network. Citizen data sits on many databases, from national identity to driver’s licence through vehicle registration to the examination bodies that capture that of teens Junior Secondary to Senior Secondary. Yet. Data capture and transfer in

Nigeria is now at par with the rest of the world in significant value-laden areas such as banking, project management and critical healthcare services. Nevertheless, Nigeria prefers to shut down to conduct elections because it insists on deploying outdated manual processes. The cost is high and unsustainable. The manual process of the elections led to various sad incidents. Agents of the ruling party went berserk across the land, not only snatching ballot boxes but burning them so the votes could not count. There was voter intimidation. Then violence perpetrated by agents or representatives of the state such as the Army. Others seized and held to ransom party and electoral officials in many states, notably Rivers and Lagos. Citizens named senior officials of the ruling party or the government in various cases of kidnapping of either party or electoral officials. Nigeria returned to the dark days of electoral violence. It confirmed the importance of leadership and the aphorism that fish gets rotten from the head. The Federal Government and its agencies failed to provide guidance. Neither the Nigerian Police nor the Nigerian Army lived up to expectations as citizens could not see them in action when required. Instead, their traces stood out in areas where wrong actions predominated. Worse was the fact of impunity and regression. In Lagos, politicians

deployed thugs to intimidate voters in strongholds of the PDP. When intimidation failed, they snatched and burnt ballot boxes. INEC officials and police officers lost their lives as did no fewer than 15 citizens. Worse happened in Lagos with the recourse to ethnic polarisation. The thugs openly asked Igbos, following the prompting of the national leader o the ruling party, to either vote APC or go to their home states to vote PDP. It was shameful. It led to confrontations and the near-lynching of one of the thugs. In consequence, Lagos State now sits on the knife-edge of potential ethnic violence. The Lagos example is particularly shameful. Lagos is the first place where Nigeria practised democratic elections since 1923. It has always been peaceful and for the most part has avoided this recourse to atavism. To regress to ethnic baiting and intimidation in 2019 is so very sad and deplorable. Electronic voting would precludeor significantly reduce incidents of thuggery and open intimidation. Citizens can deploy their mobile devices and vote on the mobile platform of INEC. We are doing so already in Nigeria with financial services and e-commerce. It is important to note on the upside that the limited deployment of electronics in the 2019 elections led to a decrease in the reported numbers for winners and losers. Cases of mass thumbprinting reduced,

even as it happened. There was also increased turnout and citizen engagement, a plus for Nigeria’s democracy. All of these were avoidable. President Muhammadu Buhari declined assent regrettably to the legislative review of the Electoral Act 2010. Top of the changes was the approval of electronic voting for the conduct and transmission of results. The bill backed INEC’s resolve to transmit results electronically in an encrypted and secured manner to prevent hacking. Nations of the world have adopted electronic voting for its numerous advantages. They include faster results that are transparent, secure, accurate and auditable. India, Brazil and the Philippines are among huge population countries that have led in the adoption given the challenges of physical movement in such large geographical spaces. Results that come faster engender trust and confidence in the system. Electronic voting also increases accessibility as citizens can vote wherever they are and do not need to engage in the substantial financial, physical and monetary costs of relocating merely to participate in elections. Moreover, electronic voting is already in use here by professional bodies with large numbers such as the Nigerian Bar Association. We must join the modern world by adopting electronic voting. It is a matter of political will and vision.

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Golden Guinea Brewery set for a rebound as burnt factory nears completion

Pg. 15

C o m pa n y n e w s a n a ly s i s a n d i n s i g h t

CONSUMER GOODS

Nigerian Breweries stock hits 8-week high on bargain hunting David Ibidapo

iger ian Breweri e s P l c re sumed on a positive note, Monday, as stock price rose 4 percent to hit 8-week high at N83.20 as investors take advantage of low prices and unimpressive financial p er for mance. The highest price recorded since trading kicked off this year on a negative note losing 8.4 percent in market value from N85.50 in December. At close of trading on Monday, the company emerged the best performer with total traded volume of 42.41 million shares which was valued at N3.55 billion. Year-to-date performance of the firm show that NB was down 2.69 percent with a current market value of N639.75 billion and a share outstanding of 8 billion

units. Surprisingly, bargain hunters have rewarded N B w i t h h ig h e r p r i c e s against some analysts forecast of a stock dumbing owing to poor fundamentals of the stock. T h e s h a re p r i c e re bounded by about 10.9 percent after prices slumped 9.64 percent the day it released its financials. “The rise this week may be due to demand and supply forces for the day, nothing spectacular ”, said Paul Uzum, a Lagos based stock broker. “it will not last,” He emphasised. Shares of Nigerian Breweries earlier in February hit N74, the lowest in 18 years as stiff competition among beer makers coupled with the declining purchasing power of consumers who sought cheaper alternatives. The down trending nature of consumers, going for more cheaper beer alternatives cou-

pled with intense competition in the industry are factors that may pressure down revenue and profit of NB. “Excise duties im-

posed by the government are a major factor affecting these brewers a s c o st ca n n o t i n t h i s time be transferred to final consumers,” Uzum

added. Analysts are optimistic about the future of NB p re d i c t i ng t hat s ha re s of the brewer may appear not appealing now

bu t w i t h rap i d g row t h in the Nigerian population; prospect in the long term for NB to rebound is high.

BANKING

Zenith Bank set to become Nigeria’s first 6 trillion Naira bank in Q1 2019 EMEKA UCHEAGA

s financial inclusion increased in Nigeria recent years, banks have been the biggest beneficiaries as cash deposits from customers have continued to increase at breath-taking pace. Amongst the biggest beneficiary is Nigeria’s most profitable bank, Zenith Bank which analysts now forecast is set to become Nigeria’s first 6 trillion Naira bank after total assets reached N5.955 trillion at the end of 2018. “At the moment, it is anybody’s guess exactly where Zenith Bank’s total assets reach at the end of the first quarter as double-digit treasury yields and lending rates could easy push total assets beyond N6 trillion

without even accounting for the marketing push to get more deposits” said Maju Eldad, a lecturer in the Economics department at Federal University of Kashere, Gombe. “Since the bank is less than N50 billion short of achieving that target and we expect their Q1 earnings to be north of N50 billion, it will definitely be the first

Nigerian bank to cross the N6 trillion mark.” Late last year, the banking system was shaken up after Access Bank announced its surprise merger with struggling Diamond bank. The merger was expected to create a N6 trillion bank (combination of the total assets of Access and Diamond bank as at the end of the 3rd

quarter 2018), however, after discounting for the N280 billion in non-performing assets in Diamond bank which is expected to be written off before the merger is completed, the total assets of the combined entity is expected to be in the region of N5.7 trillion, about N250 billion behind Zenith Bank but still ahead of First

bank (N5.34 trillion), making Access bank the second largest bank by assets after the merger is completed later this year. “We will have to wait and see the growth performance in the total assets of Access Bank and Diamond Bank as at the end of 2018 before we can ascertain if the combined entity will still be the biggest lender in Nigeria by assets, however, it is safe to say that Access will become the largest bank by customers once the merger is completed with about 29 million customers.” Eldad told BusinessDay. The other two Tier one banks, UBA and GTBank are currently the 4th and 5th largest banks in Nigeria by assets after UBA reported total assets to be N4.5 trillion and GTBank

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

reported total assets to be N3.4 trillion. As at the end of Q3 2018, UBA had trimmed the gap between its total assets and the assets to Access Bank (which is currently the third largest bank in Nigeria by assets) to around N45 billion from N104 billion as at H1 2018. The news of Zenith Bank crossing N6 trillion mark will certainly impress the founder Jim Ovia, who has been increasing his stake in the bank in the past year. Zenith was earlier expected to relinquish its crown to Access bank as the largest lender by assets but as things look today, it seems like Zenith may keep their crown for at least another quarter or even the whole year. Whichever way, the Nigerian market is certainly big enough for two kings.

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Wednesday 27 February 2019

COMPANIES & MARKETS APPOINTMENT

Omatek confirms Yemi Ogundipe as Group MD amid BOI legal tussle SEGUN ADAMS

matek Ventures, a listed company involved in the Ass embling, Sales and Maintenance of Computers, Inverters and Solar Power P ro d u c t s, h a s n o t i f i e d the Exchange on the app rova l o f t h e B o a rd t o the appointment of Yemi Ogundipe as Group Managing Director amid the ‘’non-compliance’’ of the Bank of Industr y (BOI) to a court injunction for t h e re l e a s e o f O m a t e k properties. The notice which was filed February 25, stated that Ogundipe would be charged with the responsibility of ‘’carr ying on the vision of the founder Late Engr (Mrs) Florence Seriki’’ in repositioning the Group for growth and expansion in Nigeria and the West Africa sub region. Ogundipe, a fellow C h a r t e re d A c c o u n t a n t ha d h i s f i r st d e g re e i n the University of Lagos and subsequently worked with PricewaterhouseCoopers (PWC), formerly,

M e s s r s C o o p e r & Ly brand. He is a Fellow of Institute of Chartered Accountants of Nigeria and a Fellow of Nigerian Institute of Taxation and has years of experience in both the private and public sector. More recently, Ogundipe who used to consult for Omatek was running an Information Technology firm in Lagos before his appointment. O gundipe br ings to the table, his wealth of exp er ience to guide Omatek ’s expansion of operation in the digital space, power and solar solution, internet and affordable intelligent home products and solutions as well as the traditional quality solutions of laptops, smart devices and desktop computers from Omatek factories in Lagos and Accra. T h e Te c h C o m p a n y also provided an update on its lingering case with the Bank of Industry and how despite the ruling of the Federal High court last year, for the restoration of the properties of Omatek, the BOI has refused to yield.

L-R: Vice Chancellor, Elizade University, Olukayode Amund; Founder, Elizade University, Michael Ade.Ojo; CSP, Tokunbo Abaniwonda, graduating Officer, and operating officer, Acedemy Halogen, Wale Adeagbo at the graduation ceremony of the Nigerian Police Officers trained in Crime prevention and community safety facilitated by Acedemy Halogen in partnership with Elizade University and Association of Forensic Intelligence and Crime Analysts (ACFICA) , recently.

According to Omatek, the BOI in March of 2017, appointed a receiver to realise the proper ty of one of its subsidiar ies a s s e t t l e m e nt f o r l o a n obligations at a time the company was adjusting

to new leadership. The receiver was reported to have obtained an e x-par te ju dg e me nt which was exe cute d in July 2017 but Omatek applied for the judgement to be set aside by the Federal

High Court. The BOI thereafter filed an appeal to the Court of Appeal, Lagos Judicial Division and has not complied with the resolution of the Federal Court.

Omatek expressed optimism that the issue w ou l d b e a m i cab l y re solved, adding that the investing public would be kept abreast of the latest development around the issue.

CONSUMER GOODS

Coca-Cola introduces Limca Cola in market expansion push ISRAEL ODUBOLA

oca-Cola Nigeria, a subsidiary of Coca-Cola Company, has introduced another variant - Limca Cola, aimed at expanding the presence of Limca brand in Africa’s most populous nation. The introduction of the brand to Nigerian carbonated drink market is among the numerous expansion strategies of the company in Nigeria. The carbonated drink company stated that Limca Cola has a unique cola taste that gives customers on-

the-spot refreshment, adding that the launch of the new brand reflects the company’s commitment to bring inventive refreshment to the footsteps of every Nigerian. Speaking about the new product, Gbolahan Sanni, Franchise Marketing Manager, said that the Limca Cola comes in PET bottles of 60cl, and sells for N100. “We are excited about the introduction Limca Cola to the Nigerian market. Limca Cola is a reaffirmation of our commitment to innovatively refreshing our customers on-the-goal with a good quality product, unique cola taste at

an affordable price”, Sanni remarked. Limca Cola is also available in LemonLime, Soda Water and Bitter-Lemon variants. The carbonated drink company acquired Chi Limited, maker of Chivita juice and Hollandia, few weeks back. Peter Njonjo, President of Coca-Cola’s West African unit, had said in September last year that the acquisition deal would be finalized in the first quarter of 2019. In the first month of 2016, The Coca-Cola Company and Tropical General Investment Group, the holding company of Chi Limited, announced a

binding agreement for the former to acquire an initial minority shareholding in the latter. The deal was to create a strategic relationship between two leaders in the beverage industry in Africa’s largest economy that together serves Nigeria’s most popular sparkling soft drinks, juices, water beverage brands and value-added dairy. Within the agreement, the carbonated drink firm had an initial minority shareholding of 40 percent in Chi Limited, with plans to raise ownership to 100 percent within three years, subjected to the ap-

proval of regulatory authorities. Coca-Cola, after the acquisition, assured stakeholders and consumers of Chi Limited of continued high quality products, adding that it would maintain the Chi’s feats and reputation. The Coca-Cola Company is world’s largest beverage company, refreshing customers with more than 500 sparkling brands in over 200 countries. Led by Coca-Cola, world’s most valuable brand, the Company’s product portfolio features about 20 billion dollar brands including Fanta, Sprite and Diet Coke.

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CONSUMER GOODS

Golden Guinea Brewery set for a rebound as burnt factory nears completion OLUFIKAYO OWOEYE

olden Guinea Brewery Plc said it close to the completion of the retooling work at its factory plant that will enable it to restart production In a statement released to the Nigerian Stock Exchange (NSE), the once brewer of Eagle stout, Bergedorf lager and Golden Guinea lager said it is optimistic of returning to full operations on or before the second quarter of 2019. The Umuahia-bas e d

Brewery plant which has not been active for over 16 years following a fire outbreak on its facilities in 2003 led to close of business. The company which has been undergoing a major overhaul at its facilities said the delay in filing its Q1, Q2 and Q3 financial results for periods ended 30 June, 30 September and 31 December 2018 was because the company had not commenced production. For the nine months ended 31 December 2018, the company had no rev-

enue but accrued a loss of N107.7bn, which is administrative costs related to the ongoing retooling work. It would be recalled that Nigerian Export-Import Bank (NEXIM) with the Bank of Industry also pitching in with an Economic Revival Facility provided a grant of N3.6 billion to get the plant back to work. Golden Guinea was originally named Independence Brewery Limited. It started production in 1963 with an annual capacity of 1 million gallons

Uche Orji, MD/CEO, Nigeria Sovereign Investment Authority (NSIA); with Tade Adeyeye, CMD, LUTH and head, business development, CETPower project Limited, at the commissioning of 5.8MW Independent Power Plant in LUTH, Idi-Araba, Lagos.

APPOINTMENT

Stanbic IBTC’s CFO joins Board as Executive Director OLUWASEGUN OLAKOYENIKAN

he Board of Directors of Stanbic IBTC Holdings Plc has appointed the company’s Chief Financial Officer (CFO), Adekunle Adedeji, as an Executive Director. Adedeji, whose appointment took effect from Friday, Feb. 22, took over from Victor Yeboah-Manu as the company’s CFO in April 2018. This was after Yeboah-Manu resigned to assume a similar role at Stanbic Bank Ghana. In a notice filed at the Nigerian Stock Exchange (NSE) Monday, the Board assured that with the new appointment, the new Director would continue in his role as the Group’s CFO. “The Board is pleased to welcome Adedeji as an Executive Director on the Board, and looks forward to benefiting immensely from his wealth of knowledge and experience,” the company said.

Adedeji has over 24 year’s post-graduation experience with over twenty years in the banking sector. He holds a Bachelor’s Degree in Accounting, an MBA in Finance and has attended several executive development programmes. He previously served as CFO for Stanbic Ghana from May 2013 to April 2018; and prior to that, he had served as Financial Controller for Stanbic IBTC Bank PLC, the company’s largest subsidiary. Before joining Stanbic IBTC, Adedeji had also previously served as Financial Controller and Regional Financial Controller for Ecobank Liberia and Nigeria, respectively. Prior to entering the banking industry, Adedeji worked with Ernst & Young for three years with his experience covering audit, taxation and other consultancy services. The new Stanbic Director is a Fellow of the Institute of Chartered Accountants of Nigeria; Chartered Institute of

Bankers of Nigeria; Chartered Institute of Stockbrokers of Nigeria, a Charter holder of the Chartered Financial Analyst Institute; an Associate of the Nigeria Institute of Management; as well as the Chartered Institute of Taxation of Nigeria. With 1.15 percent year-todate return, Stanbic currently underperforms the market and NSE Banking, but trading at a year-high of N48.50 per share. Stanbic grew gross earnings marginally by 9.8 percent to N168.80 billion between January and September 2018, while profit surged by more than half in the period to N59.76 billion. Operating expenses stood at N72.17 billion, representing 17.8 percent more than the N61.24 billion expended a year earlier. Stanbic IBTC Holdings provides investment banking, wholesale banking and brokerage services in Nigeria. The company was incorporated on March 14, 2012, and listed on the NSE on November 23 in the same year.

James Ilori (l), CEO, First City Asset Management (FCAM), with Oscar Onyema (r), CEO, Nigerian Stock Exchange (NSE), at the listing of two Mutual Funds (Legacy Money Market Fund and Legacy Debt Fund) of FCAM on the newly launched NSE Mutual Fund Trading Platform in Lagos

TECHNOLOGY

Helios in expansion push set to build 1,000 towers in South Africa OLUFIKAYO OWOEYE

elios Towers Plc has revealed plans to build 1,000 telecommunication towers in South Africa in the next three years as it tries to capitalize on rapid growth in mobile services and shape up for an initial public offering. Chief Executive Officer, Kash Pandya, said the company will look to acquire more towers from carriers such as MTN Group Ltd. and Vodacom Group Ltd. The country has around 30,000 towers in all, with only about 10 percent of those run by independent

companies. “While the focus is on building in the country after the acquisition of SA Towers recently provided us with 500 potential tower sites, we are looking at acquisition opportunities,” he said. The company operates cellphone towers in countries including Ghana, Tanzania and the Democratic Republic of Congo. It entered South Africa last month by striking a local partnership and buying an independent tower operator, giving it a foothold in a country expected to lead sub-Saharan Africa in rolling out faster fifth-generation networks.

It would be recalled that the UK-based company canceled a planned share sale last year and plans to use a $100 million loan facility to build the towers. While a call date on a separate $600 million bond is coming up soon He said the company was “prepared” for a second IPO attempt but had no definite view on the timing for now. Helios reported a 13 percent increase in fourthquarter adjusted earnings before interest, tax, depreciation, and amortization to $46.5 million. It had $89 million in cash at the end of last year, down from $120 million a year earlier.

L-R: Erhumu Bayagbon, head, public relations, Airtel Nigeria; Sam Nda-Isaiah, chairman, Leadership Group and host, and Muhammad Ibrahim, regional operations director, North-West Region, Airtel Nigeria, at the presentation of ‘Leadership Brand of the Year’ award to Airtel Nigeria in Abuja.

L-R: Adeola Oladugba, sport programme manager, Special Olympics Nigeria; Obianuju Asiodu, health programms, manager, Special Olympics Nigeria; Nana Wereko-Ampim, representative of Special Olympics Africa; Augustine Kokukokor, country manager, Max International, and Obinna Awiaka, opening eyes clinical director, Special Olympics Nigeria, at the Special Olympics Nigeria Max International Gives Away.

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Bank loans to farmers hit N2.2trn in 2018 Josephine Okojie

igerian banks credit to the agricultural sector has hit the highest level of N2.2trillion in 2018 since the bureau of statistics commenced the compilation of the data, a National Bureau of Statistics (NBS) bank credits report says. The loan to the sector accounts for four percent of the total lending of commercial banks to the economy for the period. On a year on year basis, bank loans to the sector increased by 16 percent, from N528 billion in q4 2017 to N610 billion in q4 2018. Also, on a quarter to quarter basis, it increased by 3 percent from N592billion in q3, to N610billion in q4. Key industry players attributed the increase in bank loans to the agricultural sector to the Central Bank of Nigeria (CBN) intervention programs targeted at supporting smallholder farmers with finance. AfricanFarmer Mogaji, chief executive officer, X-Ray Consulting Limited said that most of the loans recorded were from the CBN but only disseminated to the farmers through the money deposit banks. “Commercial banks are not giving loans to farmers, so if there is an increase, it definitely must be from the CBN because the apex bank has been asking them to give more lending to the sector,” Mogaji said.

In August last year, the CBN had approved the disbursement of about N75billion as loan to farmers in the 36 states and the Federal Capital Territory (FCT) under the Nigerian Incentive-Based Risk Sharing in Agricultural Lending (NIRSAL). The loan guarantee scheme is a public-private sector initiative set up to transform the country’s agricultural sector. It was initiated by the Central Bank of Nigeria, the Bankers’ C o m m i t t e e a n d t h e Fe d e ra l Ministry of Agriculture and Rural Development, to guarantee 75

percent loans provided by Deposit Money Banks (DPB) to farmers as part of efforts to transform the country’s agricultural sector. Similarly, in that same period in August, the CBN announced that the commercial banks and the apex institution would commence channeling the Cash Reser ve Requirement (CRR) kept in the apex bank’s vault to agricultural and manufacturing lending at single interest rate of 9 percent. The CRR is a certain percentage of the total bank deposits that has to be kept in the current account with

How good agricultural practices, farmer-education can help Nigeria control food toxins Josephine Okojie

igeria’s ability to control the high rate of toxins found in its foods largely depends on farmers’ education and their adherence to good agricultural practices, experts say. Isaac Ogara, a lecturer in the department of Agronomy, Nasarawa State University said that mycotoxins and other toxins content found in crops can be drastically reduced by mainstreaming control strategies in the country’s farming systems along the various value chains. “Farmers need to have awareness that there are deadly chemical substances that occur naturally without their knowing. One of the strategies through which farmers can protect their crops from these toxins is to harvest their crops early. Harvesting early helps to reduce the incidence of mycotoxins,” Ogara said. “Farmers must also ensure that they carry out good farming

practices by ensuring that they carry out all the cultivation practices according to recommendations and dry their crops properly. Crops must be properly dried with moisture content of about 12-14 percent,” Ogara who is also the secretary of the Mycotoxicology Society of Nigeria (MSN) said. He also stated that the use of Neem tree and Jatropha extracts also help to reduce levels of mycotoxins in foods. He noted that the International Institute of Tropical Agriculture (IITA) has developed a product called aflasafe which farmers can adopt to reduce the occurrence of the toxicogenic fungi. Toxins are poisonous chemical compounds produced by certain fungi and moulds that are threats to food and feed for human and animal consumption with regards to long term poisoning and thus, constitute a challenge to agriculture and food security. Mycotoxins are majorly found in maize groundnuts, beans, sorghum

amongst others. According to researchers there are five groups of mycotoxins which are; aflatoxins, ochratoxins, fumonisins, deoxynivalenol/nivalenol and zearalenone. “The importance of mycotoxins in our agricultural products and their attendant implications on the safety of foods and feeds, trade and health cannot be over emphasised. Food and feeds sold in our open markets are neither regulated nor traceable and this has made the zero rejection program of the Federal Government an uphill task,” said Folasade Bosede Oluwabamiwo, president, MSN. “ I t h e re f o re ap p e a l t o a l l stakeholders including our political leaders to grant the same global attention given to HIV/AIDS in terms of massive education, political support and wide spread sensitisation to mycotoxins in order to ensure availability of safer food and reduction of deaths associated with the diseases related to mycotoxins consumption,” Oluwabamiwo said.

the apex bank. The banks do not have access to that amount for any economic activity. Currently, Nigeria’s CRR is maintained at 22.5 percent by the CBN. Experts have continued to note that the biggest challenge confronting farmers is insufficient access to agro credit, which according, to them is limiting farmers’ ability to boost productivity and improve their livelihoods. “Finance is the biggest challenge confronting farmers. It is a very serious problem that the government

needs to address by providing farmers will single digit loans,” said Tola Faseru, national president, National Cashew Association of Nigeria. “Without adequate finance, farmers cannot increase their production areas and productivity which, is critical for the attainment of Nigeria’s food security,” Faseru said. N i g e r i a’s a g r i c u l t u r a l fundamentals are robust and include an estimated 84 million hectares of arable land out of which only 40 percent is cultivated and only 10 percent of the 40 percent is cultivated optimally. Two of Africa’s largest rivers (Niger and Benue) flow through and within the borders of the country. There is adequate annual rainfall, a large young workforce and over 190 million consumers that offer a domestic market to support increased food production and processing. It is only the finance to unlock all this potentials that is lacking. Experts say the glorious days of Nigeria’s agriculture could be revived when banks starts lending more to the sector. To ensure that farmers across the country have access to adequate finance and also ensure that money deposit banks lend more to the sector, even as the country realises its agricultural potentials, experts say Nigeria must begin to hedge banks against the risks associated with funding agriculture. That way, they say banks would lend more to the sector to drive growth and development.

Ekiti government says committed to cocoa cultivation Akinremi Feyisipo, Ado-Ekiti

he Ekiti State Government has reiterated its commitment to improve on the cultivation of Cocoa in the state and to make it one of the foremost producing states of the crop in the country. Mobolaji Aluko, directorgeneral, Office of Transformation, Strategy and Delivery (OTSD), made this statement during a meeting with members of the Cocoa Development Association in his office. Aluko affirmed that the d e ve lo pm ent o f agr icu ltu re remained one of the major focuses of the Kayode Fayemi administration, as about N40million has been

set aside for the establishment of a Cocoa Clonal Garden/Cocoa Rehabilitation in the state. He guaranteed continued collaboration between the state government and the farmers, which according to him would assist to revive cocoa production in the state. Francis Ibitoye, chairman, Ekiti State chapter of the Cocoa Development Association, who spoke on behalf of all cocoa farmers in the state, expressed the association’s readiness to partner the government for development of agriculture in the state. Nigeria currently ranks joint fifth with neighbouring Cameroon with 210, 000 metric tons in the 2016-2017 season, according to data from ICCO. Nigeria has two cocoa harvests, the smaller midcrop from April to June, and the main crop from October to December. The main crop usually accounts for about 70 percent of Nigeria’s cocoa output, while the midcrop accounts for the remaining percentage.

Wednesday 27 February 2019

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Bakers demand termination of payments for cassava bread initiative development Josephine Okojie

he Association of Master Bakers and Caterers of Nigeria is calling on the Federal Government to terminate the N1,000 payment per 50kg bag of flour meant for the development of the cassava bread initiative. The bakers say that it is fraudulent for the government to still be collect payment for the policy development when the initiative has since collapsed. “No flour miller in Nigeria is adding cassava flour into their flour as we speak. Yet, the government is still collecting N1,000 on every 50kg bag of flour sold in the country” Jude Okafor, national publicity secretary, Association of Master Bakers and Caterers of Nigeria said in a telephone response to BusinessDay questions. “The fund collected by the government is meant for development of the cassava bread initiative. What then is the government developing when the policy has been abandoned for more than

four years now?” Okafor asked. He stated that prices of flour would have been cheaper if the extra N1,000 paid on each 50kg were not included, saying consumers would have been paying less for bread than they are paying now. He called on the Federal Government to terminate

the payment and use the already collected funds to support bakers and cassava flour processors across the country. The cassava flour initiative started in 2002 when flour millers’ were mandated to substitute five percent cassava flour in wheat flour meant for baking bread and production of other confectionaries.

Scale-up agriculture for national development, expert advises Josephine Okojie

amson Odedina the rector of Moshood Abiola Polytechnic, Abeokuta, has called on the government to scale up agricultural solutions and practices to enhance national development in the country. Odedina made this call while delivering the FUNAAB alumni 21st convention and 20th annual lecture series t i t l e d ‘A g r i c u l t u ra l a n d Na t i o n a l D e v e l o p m e n t , Scaling Agricultural Solutions for Sustainable National Development’, a statement made available to BusinessDay states. According to him, about 70 percent of the Nigerian population is engaged in agricultural production at subsistence level. He further stated that the sector is one of the most important sectors in the country as it accounts for more than half of Nigeria’s labour force. While critically analysing the reasons why there is currently food insecurity in Nigeria, Odedina pointed out that lack of government

supporting role and the inability of individuals to see agriculture as our business has continued to production. Odedina said that the lack of mechanised equipment, poor farmer education, lack of credit facilities, and poor linkage, as well as high volume of agricultural imports among others, are the factors limiting the sector. He observed that if adequate attention is given to the sector by the government in the areas of infrastructure and credit, agriculture can create wealth and employment, reduce poverty, and increase food security, among others. He enumerated solutions t o t h e p ro b l e m s f a c i ng agriculture in Nigeria to include creating modern agricultural education programme for farmers, use of technology, rehabilitation and upgrade of research and training facilities in colleges, polytechnics, universities, re s e a rc h i n s t i tu t e s a n d vocational centres. He listed other solutions as including, farming friendly government policies,

incentives for youths for more engagement in the sector through entrepreneurship education and provision of credit facilities for start-ups, farming friendly government projects such as solar/wind projects/irrigation projects, and input supply to farmers. He also listed examples of scaling up required to provide needed solutions to include government support in the area of providing multilateral finance assistance from global institutions for agricultural development, funding of agricultural programmes, such as the Agricultural Transformation Agenda (ATA), Green Alternative Programme (GAP); Non-Governmental Organisation’s support; Special Privately/Internationally Funded Projects such as CAVA, CIAT/Harvest Plus. Others are, through advocacy; youth engagement; students industrial work exper ience, innovation, entrepreneurship and empowerment programmes such as specialised borrowers p ro g ra m m e s, c o r p o rat e entrepreneurship programmes and reality TV programmes.

In 2007, the policy, which was already gaining momentum, was abandoned as the Obasanjo led government left office, thus bringing the whole policy process to a halt. After five years of being abandoned, in 2012, former President Goodluck Jonathan re-introduced the cassava flour inclusion policy to

encourage the substitution of high quality cassava flour for wheat flour and the inclusion rate increased steadily from 10 percent to 40 percent by 2015. Since 2015, the policy has collapsed and no flour miller in the country is currently including cassava flour to their production. “We have no record to the effect that any flour miller in the country is adding even one percent of HQCF to its production of flour currently,” Ayo Olubori, chairman, National Cassava Processors and Marketers Association (NCAPMA) said in a telephone interview. “The millers are not buying from us and are not willing to off take at the price we are offering to sell,” Olubori said. According to the United States Department of Agriculture (USDA), Nigeria’s 2018/19 wheat imports are estimated to be 5.4 million metric tons, a four percent i n c re a s e f ro m 2 0 1 7 / 1 8 estimates. The report attributed the increase in wheat imports to millers’ growing access to foreign exchange and

increase consumption. Responding to BusinessDay’s questions on while flour millers have abandoned the policy, Olalekan Saliu, secretary, Flour Milling Association of Nigeria said that most of the cassava flour in the market is not of industrial standard but that flour millers are still buying up the industrial grade cassava flours from big processors like Thai Farms . “Most of the cassava flour produced by the small and medium sized processors is of low quality and does not meet industrial requirements but we are still buying what is available from processors with industrial grade cassava flour,” Saliu said. A l s o , g o v e r n m e n t ’s inconsistency and failure to effect the use of cassava flour has also resulted in the loss of huge revenues that could have accrued from an active industry. Nigeria’s local demand for HQCF is put at 504,000MT and supply is 60,480MT, according to data from the Manufacturers Association of Nigeria (MAN).

How to establish an integrated rice processing plant Olumakinde Oni

he ban on the importation of rice across Nigeria’s land boarders and the renewed commitment of the Federal Government to boost the production of the crop, shows a huge investment potential in the milling aspect of the produce. Rice can be grown conveniently in Nigeria, the climate is good. It can be grown both in the forest and savannah areas of Nigeria. The project is, therefore, technically feasible. The project is highly profitable. Price of rice in the market is very good for the producers, hence the project’s economic viability. The prospect for in investment in rice production in Nigeria cannot be overestimated. This is why both indigenous and foreign investors are going into it. It has also been found out that out local rice has more nutritional value than the imported varieties. Currently, to meet our re q u i re m e nt s, w e mu s t

produce a minimum of 10 million metric tonnes of paddy. However, local paddy production has increased from about two million metric tonnes to about 4 million metr ic tonnes and still growing. This means that getting paddy for the rice mill would not be a problem for potential investors. Production technology The whole idea about this project is to make it an integrated one. The raw material, rice paddy will be grown and processed by the prospective investors. The target is to produce 4,000 metric tonnes of finished (polished) rice per annum. Requirements are land, plant and machinery, buildings, farm inputs (seeds, fertilizer, herbicides and insecticides) and packaging materials. Rice cultivation process includes land preparation, planting/distribution, herbicides and fertilizer application, harvesting and threshing. The harvested rice will later be processed in the

factory. Rice processing includes parboiling, drying, de-stoning, dehauling, winnowing, polishing, and packaging. Financial Implication The project has been estimated to cost N100 million broken known as follows: Farm land acquisition & cultivation: N50,000,000 Establishment of factory/ equipment/utilities: N50, 000,000 Total N100, 000,000 =========== Profitability Estimated revenue realisable by the project is about N400 million annually. Annual production costs have been put at N270 million. Annual profit of N130 million is guaranteed. This project is therefore recommended for funding. Serious minded investors can be assisted in terms in packaging to attract bank financing, project establishment and m a n a g e m e n t , a u t h o r ’s c o nt a c t : 0 8 0 2 3 0 5 8 0 4 5 , olumakindeoni2@yahoo.com

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Wednesday 20 February 2019

Maritime e-Commerce

Kaduna Inland Dry Port records import cargo throughput of 2,318 TEUs in 2018

…Export cargo performed low at 12TEUs amaka Anagor-Ewuzie

total of 2,318 twenty-foot equivalent units (TEUs) containers of import cargoes were handled in the newly commissioned Kaduna Inland Dry Port (KIDP) between January and December, 2018, Import Performance Rating obtained exclusively from the Nigerian Shippers Council (NSC), has revealed. Furthermore, the dry port handled only about 12 TEUs of export cargoes within the period under review. The performance rating shows that container traffic was slightly low in the second quarter of the year, due to the Apapa gridlock, operational challenges and insecurity, towards the fourth quarter of the year 2018 in the Kaduna environment. In the area of import, KIDP recorded monthly average of over 150 containers in throughput, which was described as a positive development, considering that it is a new port. A breakdown of the import shows that a total of 248 TEUs of containers were handled in January; 226 containers was recorded in February; 289 containers were handled in March; 218 containers in April; 193 containers were handled in May while a total of 195 containers were handled in the month of June. A total of 161 containers of import cargoes were also handled in the Kaduna port in July; 178 containers in the month of August; 128 containers in the September; 154 containers were received in the port in October; another 154 containers in the November, while the remaining 174 containers were

handled in December. The Import Performance Rating shows that mostly household equipment and vehicles were brought in as import in Kaduna Port. On the other hand, the 12 containers of export cargo comprised of ginger that was taken to Rotterdam and cowhorn as well as charcoal that were shipped to Vietnam. “The export performance within the period was extremely poor. This was due to lack of railway locomotives and wagons, lack of export product cluster, problems of packaging and operational challenges.” Kaduna port, operated by the Inland Containers Nigeria Limited (ICNL), has the capacity to handle a minimum of 29,000 TEUs of containers annually. The port targets transit cargo for neigbouring

countries of Chad and Niger, whose owners would have opportunity to clear their cargo in Kaduna without additional cost of air ticket, accommodation and other issues that involve coming to Lagos. Commenting, Hassan Bello, executive secretary of the NSC told BusinessDay in an interview that rail is cardinal to the success of dry ports because the main aim of dry ports was to reduce congestion in the seaport. Bello stated that rail is needed to reduce cost because the cost of transporting cargo from Apapa to Kaduna Port by truck has become astronomical. “If we have the rail, it will reduce one quarter of the cost and the volume will increase. Rail would ensure seamless connection from the seaport to the inland port. Now, what we

have is road transportation of cargo by truck. The Kaduna dry port would have been busier if we had rail transport,” he said. Bello disclosed that the Council is currently working with the Nigeria Railway Corporation (NRC) to provide ten wagons and two locomotives to attend to the needs of importers and exporters. “The Federal Government is giving attention to the workability of the dry port. We have got Kaduna commissioned and we are working on Funtua and Jos. There is one coming up in Ibadan and if we complete that, it means transport efficiency will increase and there will be reduction in the cost of doing business,” he explained. Recall that President Muhammadu Buhari in January 2018, commissioned the Kaduna Port in Kakuri, Kaduna

State. Kaduna Port is the first Inland Dry Port to be completed in Nigeria, from the seven approved across the country. Others include Ibadan, Aba, Kano, Jos, Funtua and Maiduguri and they are at various stages of completion. The completion of the Kaduna Port was facilitated by the declaration of Kaduna as a port of origin and destination on the 16th of May 2015, by the former President Jonathan administration, meaning that the port is now recognised by the United Nations Conference on Trade and Development (UNCTAD) as a port to which goods can be consigned from, and from where goods can also be consigned to from another destination. Yusuf Ismail, managing director of the ICNL said recently in Lagos that the inability of the

NRC to move cargoes from the Lagos port to the Kaduna port, has affected economic activities at the port. Ismail said that the high freight cost of containers to the port by road from Lagos is taking toll on the business, which, according to him, has increased by 100 percent, making the port uncompetitive. The cost of transporting cargo from Lagos to Kaduna port would have been cheaper if the rail line was in perfect condition. But, since the rail is not working, we are forced to be using road and the condition of roads in Nigeria is bad. This has increased cost of transportation such that instead of spending N400,000 for to move one by 40-foot container, we spend N800,000 to move one 40-foot from Lagos to Kaduna,” Ismail said.

AP Moller - Maersk grows revenue by 43% to USD39 billion in 2018 … Expects earnings before tax to hit USD5bn in 2019 amaka Anagor-Ewuzie

ollowing the progress made from the introduction of integrated offerings, digital solutions and robust network improvements, A. P. Moller - Maersk said it has grown topline by 43 percent to USD39 billion in 2018, showing an additional USD12 billion in turnover. “In 2018, we made sig-

nificant progress in implementing our strategy. With the expected demerger and listing of Maersk Drilling in April, the separation of our energy-related businesses will be almost complete. We have successfully integrated Hamburg Süd, accelerated our digital transformation and come together across sales, customer service, delivery and products as one company with customers at the centre of our attention,”

said Søren Skou, CEO of A.P. Moller - Maersk. According to him, profitability was in line with the latest guidance for 2018, with earnings before interests, tax, depreciation and amortization (EBITDA) of USD3.8 billion, up 8 percent over 2017. He said that the improvement in operating earnings was driven by higher freight rates, efficiencies gained from the integration of continuing operations, and the acquisi-

tion of Hamburg Süd. “EBITDA was lower than initially expected at the beginning of the year, primarily due to an increase in bunker fuel prices not fully recovered by higher freight rates. “Though, we had a challenging start in 2018 we increased earnings despite significantly higher bunker fuel prices and lower than expected container volume growth in the second half of 2018,” said Skou.

In 2018, the company reduced net interest-bearing debt from USD14.8 billion to USD8.7 billion. “Following the listing of Maersk Drilling through a demerger and subject to maintaining investment grade rating, details on future dividend policy, capital structure and the distribution of a significant part of the proceeds from the sale of Maersk Oil will be announced no later than August 2019,” he added.

Stating that from 2019, Maersk will apply International Financial Reporting Standard (IFRS) 16, Skou note d that IFR S 16 entails that leases beyond 12 months will be included in the balance sheet as assets and liabilities. For 2019, Maersk expects EBITDA of around USD5 billion including effects from IFRS 16, and around USD4 billion excluding effects from IFRS 16.

Wednesday 20 February 2019

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NSC and moves to sanitise the ports for service efficiency amaka Anagor-Ewuzie

espite the Federal Government port reform of 2006, which ceded cargo handling operations to private terminal operators, business activities in the nation’s seaport are still being hampered by bureaucratic bottlenecks, human interference and clumsy procedures. This not only creates several avoidable costs such as demurrage and storage charges to port users, but also creates a situation where jobs and businesses in the port become an all comers’ affair, as foreigners make their way to the nation’s seaport to take away jobs that ordinarily belong to Nigerians. Upon appointment of the Nigerian Shippers Council (NSC) as the port economic regulator, the council took up the challenge of restoring sanity in the ports by replicating the happenings in the global maritime environment to bear in our local environment. First, in a bid to fight for the interest of the shippers by ensuring competitive pricing for port services, the NSC entered into loggerheads with the terminal operators and shipping companies. The loggerhead became serious such that the case was left for the court to decide. However, as a port regulator, the NSC had considered the interest of the shipping companies and terminal operators before going ahead to create an atmosphere of possible soft landing, after the

Appeal Court verdict in a case between shipping companies, terminal operators and the council as the regulator. BusinessDay understands that the Appeal Court has mandated the terminal operators and shipping companies to refund the charges collected over the years from port users with an interest of 21 percent. Though the case had gone to the Supreme Court, but there are strong moves to settle-out-of-court based on the consequences, should the apex court pass judgment against shipping companies and terminal operators. Obviously, the council has left its doors open for settlement believing that enforcement of the judgment of the Supreme Court if the Council wins, is capable of creating severe economic hardship for the service providers. The Council played a prominent role in the actualisation of the Council for the Regulation of Freight Fo r wa rd i ng i n Nig e r i a (CRFFN) in 2007, and this saved shippers the hardship they encountered in their businesses. The council had handled thousands of cases in which international suppliers’ defrauded Nigerian shippers in some transactions with refunds secured for Nigerians. In addition to that, the NSC also spearheaded the call for infrastructural development targeted at promoting efficient services. This is apart from creating harmony among players, protecting the shippers, freight forwarders against illegal charges and other unfriendly business practices.

Hassan Bello

To ensure that Nigeria becomes the centre of maritime trade, where transshipment of West and Central African cargo can take place, the council has tried to leave no stone unturned in addressing both human and infrastructure obstacles to port business in order to bring sanity to the nation’s ports. Already, the council has been working hard to ensure that modern cargo handling equipment are deployed at the ports. This has been through embarking on equipment audit of the port. This, according to Hassan Bello, executive secretary of the council, has been very impressive. However, the issue currently confronting the council is that of presence of quackery and lack of sanity at the ports. This has led to the introduction of annual registration fee for all service providers at the ports. Following the strong opposition from the service providers, the NSC has gone

a step further to review and is set to publish the new fee. A breakdown of the new fees shows that Seaport Terminal Operators, who were supposed to pay N100,000 as registration fee, will now pay N50,000; stevedoring companies and warehouse operators who were supposed to pay N20,000 will now pay N5,000; while shipping lines and shipping agencies that were to pay N100,000, will now pay N50,000. Inland container depot operators, who were supposed to pay N50,000, will now pay N25,000; off dock terminals registration fee was reduced from N20,000 to N10,000; freight forwarders and clearing agents fees were reduced from N10,000 to N5,000; haulage companies fee was cut down from N10,000 to N5,000. Others include, shippers who will be paying N1,000; cargo surveyors to pay N5,000 and shippers associations fee was reduced from N20,000 to

N5,000. BusinessDay understands that the registration, which is aimed at regulating the activities of the service providers, will ensure quality service delivery and eradication of quackery in the maritime industry. It will also enable the regulator to sufficiently protect indigenous operators from foreign dominance. Since the introduction, some service providers have expressed dismay, describing it as additional cost to their businesses but industry watchers believe that there will be a soft landing somewhere between the ports economic regulator and the service providers on the issue. And this may not be unconnected with the goodwill which the council enjoys among all the service providers that are affected in the registration process. Speaking in an interview, Bello, who described the registration as the basic and a one-off, said that it was of much interest how people reacted to newly introduced registration fee for the service providers. Bello said that the reaction was good because the council must consult stakeholders before taking certain actions, adding that stakeholders have the right to make observations. According to him, the reactions show that no stakeholder has issue with the registration because it is good to have database, rather the issues raised were around the cost of the registration fee. “S o m e p e o ple co m plained that the fee was on the high side and I think that they were right. This was why

the council has to look at the fees again. The Shippers Council is the one to reduce the cost of doing business and not to increase the cost. We have listened to the reactions of the people and we are going to the public with the new fees. Now, we have brought down the fees,” Bello added. Samuel Vongtau, director, Legal Services of the Council, said that the registration will help government to check quackery within the system, and will help the Council to know the number of service providers operating within the sector, an exercise that will bring relative ease in the ports. Vongtau, who spoke at a sensitisation workshop organised by the NSC, appealed to the service providers to register with the ports economic regulator as part of the efforts to providing efficiency at the ports. “With this, the council promised it will be able to rid the ports of touts and quacks that are currently common. “The registration will bring sanity and reduce congestion at the port. Once the service providers are registered and known, the number of people entering the port will be reduced,” Vongtau said. Knowing the players in the ports, in terms of number and types of businesses they are doing, will be easier to make financial projections that will enable government and policy makers to know what the sector can generate. Therefore, it is expected that in consideration of these, service providers will embrace the new registration process.

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Wednesday 27 February 2019

Tax Issues

FIRS freeze order on taxpayer’s bank account criticised Iheanyi Nwachukwu

he Federal Inland Revenue Service (FIRS) decision to impose a freeze order on a taxpayer’s bank account for tax liabilities has attracted criticisms by experts. The Federal Inland Revenue Service (FIRS) recently issued Letters of Substitution, pursuant to Section 49 of the Companies Income Tax Act (CITA) 2004 and Section 31 of the Federal Inland Revenue Service Establishment Act (FIRSEA) 2007, to banks in Nigeria, appointing them as tax collecting agents for certain listed customers (affected companies) maintaining bank accounts with such banks. In a January 22, 2019 letter signed by Tunde Fowler, Executive Chairman, Federal Inland Revenue Service (FIRS), the Taxman appointed banks as collecting agents for the full recovery of the said tax debts. FIRS wants Nigerian banks to seek its approval to execute transaction in the accounts of no fewer than 2,933 companies it said to have been identified for not paying taxes. The FIRS, in the said Letters of Substitution, alleges that the affected companies have breached their tax obligations by failing to pay tax to the FIRS, as and when due, and provided the Substitution Banks (SBs) with an indication of a specific amount owed by each said company. The SBs were directed to

set aside the indicated sums and pay such over to the FIRS in full or partial payment of the alleged tax debt. Furthermore, the FIRS demanded that the banks should not execute any mandates on those accounts without its prior approval. The FIRS told banks that “The statement should cover the period from the date the accounts were opened to the date or receipt of this notice,” adding that they have just 7 days from the receipt of the letter to respond concerning issues contained in the notice. FIRS also threatened to sanction banks that fail to comply with this notice. Though, associated pressure may have reduced lately due to elections by the FIRS asked that banks should within 72 of receipt

of the notice, forward detailed bank statements and financial records for the said companies and/or any of their subsidiaries, holding accounts with the banks. Banks were also asked to provide records of all principal officers related to any of these companies. “Nothing in the CITA or FIRSEA authorises the FIRS to impose a freeze order on a taxpayer’s bank account beyond the amount of tax proven to be due and payable by that taxpayer. The requirement directed to banks not to honour mandates from taxpayers over and above the tax amount supposedly proven by FIRS to be due and payable is without foundation and goes too far”, KPMG said in a recent note titled “Appointment of banks

by FIRS as collecting agents for recovery of alleged tax liabilities”. “We note and salute the FIRS’ objectives to bring delinquent taxpayers into the tax net and consequently increase the Federal Government’s tax revenue. However, the current practice whereby the FIRS issues fiats to freeze taxpayers’ bank accounts generally and to demand that SBs pay alleged outstanding tax liabilities from customers’ bank balances without recourse to affected persons, is draconian. This will cast doubt on the Federal Government’s drive to improve the ease of doing business in Nigeria, diminish the credibility of the Nigerian tax system, and erode investors’ confidence in the Nigerian economy,” KPMG further

noted. “There are key questions regarding the powers of the FIRS to place a lien on a taxpayer’s bank account and the lack of due process in doing so in many cases. We are of the view that the substitution power granted the FIRS under the relevant laws does not support the freezing of bank accounts in the way and manner the power is being exercised by the FIRS”, said PwC Nigeria. In a chameleonic move recently, the Federal Inland Revenue Service directed banks to suspend its lien on bank accounts of alleged tax defaulters for a period of 30 days with immediate effect. Though, this decision is seen as politically motivated ahead of elections as it may be revisited thereafter. “Based on the letter written by the FIRS, taxpayers whose bank accounts were previously frozen pursuant to FIRS’ directive would now be able to access their accounts for a period of 30 days”, Andersen Tax said. “Notwithstanding the controversies regarding the powers of the FIRS to freeze taxpayers’ bank accounts and the silence on whether such bank accounts would be frozen after the suspension, affected taxpayers should take advantage of the next 30 days to resolve their outstanding tax issues relating to pending assessments. They are also advised to engage their consultants and regularize their tax positions to avoid similar hardships on their businesses after the said period”, Andersen Tax further noted.

How VAT took over the tax world

alue-added tax and goods and services tax should be broadbased and integrate a long-term perspective to be effective, according to EY Global. Value-added tax (VAT) is continuing to evolve and expand as new systems roll out and existing ones adapt to digital disruption and other forces. In the six decades since the valueadded tax first made its debut in France, this broad-based consumption tax has spread rapidly across the globe. Governments are fond of VAT and its cousin, the goods and services tax (GST), for many reasons. The levies are considered one of the least harmful taxes for economic growth and can raise large amounts of revenue because they apply to a significant proportion of economic activity. “One of the biggest issues we had was businesses that did not prepare early enough in terms of systems training and testing”,Dato’ Sri Subromaniam Tholasy, Director General, Royal Malaysian Customs Department. According to the Organisation for Economic Co-operation and Development (OECD), some 166 countries operated VAT or GST in 2016 – twice as many as 25 years ago. Many countries have had a VAT or GST system for decades. Other jurisdictions are recent adopters, such as Malaysia and Tanza-

nia (2015), Egypt (2016), India (2017) and member states of the Middle East’s Gulf Cooperation Council (2018). Today, VAT and GST continue to expand and evolve as new systems roll out and existing ones adapt to the implications of digital disruption and other forces. This transformation has consequences for businesses, which must adequately prepare for new VAT and GST rules and procedures, and update their technology to comply with new e-filing requirements. Early bird Countries planning to introduce a new VAT or GST system should keep in mind that a well-planned transition is important. The introduction of such a tax requires adequate administrative capacity, training and technology on the part of both businesses and the government. “There’s typically a broad public education program, as well as a lot of publicity about the resources that will be attached to enforcing the tax,” says Alan Schenk, distinguished Professor at Wayne State University Law School in Detroit, who drafted VAT legislations for numerous Caribbean and African countries. “In the EU, making changes is particularly difficult because all the countries need to agree unanimously on the

change”, Christopher Heady, Professor of Economics, University of Kent. Royal Malaysian Customs Department Director General Dato’ Sri Subromaniam Tholasy says that it’s critical for businesses to start preparing for new VAT and GST systems far in advance. “One of the biggest issues we had was businesses that did not prepare early enough in terms of systems testing and training,” says Subromaniam Tholasy. “Some companies left the implementation to the finance and accounting staff, but it requires much broader involvement. People from the sales and marketing sides also need to be involved since, for example, agreements may need to be renegotiated. It was also our experience that many small- and medium-sized businesses waited until the last minute, then had issues when it came to filing.” Lessons learned VAT and GST systems should be broad-based. They should take a longterm view rather than short-term to be effective. Many jurisdictions have learned the hard way that if their initial VAT and GST systems exempted too many items or entire economic sectors, it is hard to eliminate those exemptions later. The task is made even more difficult

when multiple jurisdictions require consensus to alter what is subject to tax, as is the case with the EU. “In the EU, making changes is particularly difficult because all the countries need to agree unanimously on the change,” says Christopher Heady, Professor of Economics at the University of Kent in the UK and former Head of the OECD’s Tax Policy and Statistics division. “Many people think there are things wrong with it, but there’s not a great deal of optimism that much can be done about them.” Nevertheless, the EU’s VAT system is moving forward in other ways. “There are multiple ongoing EU discussions regarding VAT issues, including certain VAT obligations for supplies of services and distance sales of goods, administrative cooperation, and a system for intracommunity supplies of goods between taxpayers,” says Jenny Netterström, Business Developer at the Swedish Tax Agency (Skatteverket). Since eliminating exemptions often proves difficult or impossible, jurisdictions often turn instead to raising rates. Since the start of the financial crisis in 2008, worldwide VAT and GST rates have risen rapidly, with the standard rate hitting a high of 27% in Hungary. The trend has now slowed down, how-

ever, and as economic conditions improve, some jurisdictions are lowering their standard rates. Heady says that the lesson for countries launching a new VAT and GST system is to start with as few exceptions and reduced rates as they can possibly manage. Some countries have managed to implement this type of broad-based tax, generally referred to as a modern VAT, says Schenk. “This approach started in New Zealand (1986), then was picked up by Canada (1991) and in a number of the new VATs around the world,” Schenk says. Another lesson a number of countries have learned is to avoid lists of specific items to be taxed, according to Heady. Similarly, single rates are preferable. Otherwise, tax administrations may be forced to debate how new products or services should be taxed. “In the UK, most food and many beverages are zero-rated but soft drinks are subject to the standard VAT rate,” says Heady. “In one dispute, smoothies were an issue. Are they a food or a soft drink? How much fruit does there have to be in a smoothie for it to be a food and not a soft drink?” Continues next week

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Global rail focus could cut transport emissions- IEA Pg 23

A-Class expands Mercedes’ compact car range

MIKE OCHONMA mikeochonma@gmail.com

he German brand with the ringed tree-pointed star; Mercedes-Benz is continuing its compact car portfolio expansion drive following the introduction of the A-Class compact sedan, following suit with the likes of the A-Class, CLA & GLA. It comes with a modern and superior sporty design, an unrivalled experience with MBUX, Intelligent Drive functions from the S-Class, a completely redefined interior design and optional equipments and appointments like Keyless-Go with Hands-Fress access. The exterior of the A-Class Sedan exudes a modern and a superior sporty design. The front end takes a very progressive look with the low, elongated bonnet, the slimline headlamps with chrome element, the torch-like daytime driving lights - plus the single-louvre diamond radiator grille with optional chrome pins, and the central star. The side mirrors sit on the beltline, while the 16 to 19-inch wheels and the pronounced wheel arches give the A-Class Sedan a sporty stance on the road. On the rear end there are two-part tail lamps that emphasizes width, the rear reflectors have been relocated to the modular two-part rear bumper and depending on the selected equipment, this rear bumper is available with a black diffuser or with chrome trim strip and chrome tailpipe tips. The Multibeam Led headlamps are another highlight that allow extremely quick and precise, electronically controlled adjustment of the headlamps to suit the current traffic situation. Each headlamp features 18 individually actuated LEDs. Mercedes-Benz’s compact car segment is already fast growing with the acquisition of new customer groups from different regions around the world. This has aided Weststar’s resolve to attract different customer groups

Coscharis lures JLR owners with special repairs rebate

in Nigeria who look to enjoy the best driving experience regardless of their automobile preferences. Due to an increase in demand, the A-Class is for the first time also offered as a sedan. This follows up the successful launch of the new A-Class last year that pushed boundaries in major markets. The inside of the A-Class Sedan comes in a modern and avant-garde look emphasizing a revolution from within. The dashboard gets a completely new and avant-garde design, with a cowl above the cockpit and the wing-shaped main body of the dashboard extending from one front door to the other with no visual discontinuity. Also the optional Widescreen display is completely free-standing and the air vents come in a sporty turbine look. An optional equipment is the ambient lighting with 64 colours, it comes with even more variety as well as an emotive presence. The A-Class Sedan also highlights spaciousness as a key feature of its

interior offering great utility. This includes above-average shoulder, elbow and headroom plus the easy access to the rear. It is at the top of its segment with regard to rear headroom (944 mm). The A-Class Sedan keeps up the pace with technology from the AClass, the Mercedes-Benz User Experience (MBUX) comes as a standard equipment. The major highlight of this system is its ability to learn thanks to artificial intelligence. MBUX is customizable and adapts to the user. Other key highlights of MBUX include; the widescreen cockpit, touchscreen, navigation services, smartphone integration, vehicle set up app, Linguatronic voice control, LTE communications module for Mercedes me connect services and Burmester surround sound system. Power is transmitted by the 7GDCT dual-clutch transmission, this system is an automated three-shaft manual transmission consisting of two subtransmissions, each with its

aguar Land Rover in partnership with Coscharis Motors Plc has commenced a complimentary genuine parts voucher to the value of N70,000 and 15% rebate on labour to all customers whose vehicles are 4 years or older and have not visited the dealership in the past 15 months. Cosmas Maduka Jnr., executive director in charge of Aftersales, Coscharis Motors said the offer is to further delight customers and a further expression of the dealership’s commitment to ensuring that its customers generally enjoy fantastic opportunity for its Jaguar LandRover brands through ease ownership”. The special offer runs till March 31, 2019 or the first 90 customers to visit any of the dealership outlets, whichever comes first. The objective is to provide our valued customers with additional aftersales incentives to keep the premiumness of their vehicles intact after purchase over the years. own clutch. This allows a particularly Coscharis, Cletus Aregbeshola, comfortable but nevertheless dynam- Jaguar Land Rover marketing manic mode of driving. Mirko Plath, managing director, Weststar Associates Limited, authorized general distributor of MercedesBenz in Nigeria has described the growing compact car family as a step in the right direction from MercedesBenz. He also pointed out that the AClass Sedan would serve more customer groups and that owning a Mercedes-Benz would be more attractive for the younger generation with the emotive and technological appeal of the MBUX, the modern design of the A-Class Sedan, the latest driving assistance systems and a very competitive entry price. The brand’s compact car family has continued its growth in the Nigerian market with the A-Class Sedan set for its arrival, following the successful introduction of the new A-Class last year. Weststar Associates Limited will be introducing the A-Class Sedan in May this year.

ager, the objective is to fashion a support service for all owners who cannot benefit from the five years service offer given the relative age of their vehicles. Coscharis Motors is one of the Nigerian automotive industry leader with sales and service dealership networks across the six geopolitical zones in the country. It has the exclusive franchise for Jaguar Land Rover brands in the country for over 17 years and ensures that only certified technicians maintain customers Jaguar Land Rover vehickes with only genuine parts.

Regular care as important as car ownership (2)

ast week, we published the first part of the how best servicing your car can sometimes feel like a bit of a chore. What that means is that, if your car feels healthy and performing as usual and is not showing any warning signs. To an extent, you could be forgiven for not being particularly enthusiastic for paying to have it serviced, especially when you consider that the servicing does not show any visible improvements. However, servicing is an important part of car ownership. In our last edition, we highlighted five out of the 10 reasons why you need to make sure you stick to your service schedule. Here is the concluding part of that piece on how regular auto car can be as important as owning the vehicle. Longevity- Whether you buy new or used, the chances are that

you’re going to be holding on to your car for a number of years and countless miles. Going forward, to get the most out of the engine and components

that you are paying for, you are going to want to look after them. Cars rarely see over 100,000 miles (160,000 kilometers) if they have not been properly looked after,

whereas other cars with the proper maintenance can often live on for twice that amount of mileage. Not as expensive as you think. Lots of manufacturers want you to take your car back to their dealerships for a check-up, and they can afford to offer great discounts when doing so. Spreading the costs of servicing over monthly instalments can really take the sting out of the annual service and it will also help make sure you stick to the servicing schedule. Something to consider? Prevent malfunctions. A dirty engine can cause a huge range of mechanical issues which can be expensive and inconvenient further down the line. Do yourself a favour and give your car the best healthcare you can afford otherwise you could find yourself sat waiting for a breakdown truck on the hard shoulder because of

a malfunction that could have easily been prevented. Easier to sell. Think of it, if you were a buyer and you were looking at 2 near-identical cars, only one had a highly comprehensive service history with the correct stamps and one didn’t - which would you feel more comfortable buying? Exactly. A vehicles service history tells a lot about the car but even more so about the owner and how they treated the car. Peace of mind. Perhaps the most satisfying thing about having your car serviced is driving away from the garage and knowing that your car has been given the best chance to complete another year of hassle-free motoring. Of course, there are no guarantees in life, but you’ve done the best you can and that’s all you can ask of yourself… How refreshing.

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Facelifted Ford Ranger set for African markets MIKE OCHONMA mikeochonma@gmail.com

he Pick-up segment will be upbeat in most African markets following the commencement of production of the facelifted Ford Ranger in South Africa which hasover the years served as the major feeder hub in the Sub-Sahara Africa. The facelifted Ford Ranger lineup will comprise single cab, super cab and double cab body styles. Few weeks ago, news filtered out that, Ford South Africa has officially begun building the facelifted Ranger bakkie, with the first unit rolling off the line recently. The newcomer brings numerous updates and refinements as it tries to set the bar for leisure Pick-up (otherwise called bakkies outside Nigeria). The plant, located in Silverton, Pretoria has been churning out Rangers and Everests, and this is set to continue with both the facelifted Ranger, Ranger Raptor and forthcoming facelifted Everest. The first of the facelifted Rangers recently rolled off the line and will be going on sale in the coming months. According to Neale Hill, managing director, Ford Motor Company (FMC) Sub-Saharan Africa Region, “Following the investment of over R3-billion in our local operations and extensive upgrades to our plants over the past 18 months,

we are delighted to see the first of the new Ford Ranger models coming off our production line”. The Ford Motors SA managing director said, the development is an extremely important and exciting year for the Ford Ranger, which will also see the launch of the first-ever Ranger Raptor that is undoubtedly one of this year’s most highly anticipated new models. The 2019 Ford Ranger features new engines, yet is more fuel efficient and boasts improved refinement and impressive technology. One of the new engines is a 2.0 Bi-Turbo diesel which is assembled at Ford’s engine plant

in Port Elizabeth. It produces 157 kW and 500 Nm, which interestingly is up 10 kW and 30 Nm when compared to the current 3.2-litre 5-cylinder. Ford is claiming a 9% improvement in fuel economy when this engine is mated to an all-new 10-speed automatic gearbox. There will be a single turbo version of this engine and that produces 132 kW and 420 Nm, and is also available with a 10-speed automatic transmission. For those who were fans of the 2.2-litre and 3.2-litre, Ford says, they have no course for worry as those powertrains are not going

‘

The plant, located in Silverton, Pretoria has been churning out Rangers and Everests, and this is set to continue with both the facelifted Ranger, Ranger Raptor and forthcoming facelifted Everest anywhere and will be carried over. The new Ranger is set to be launched locally in South Africa in the first half of 2019.

Nissan Micra range gets new tech-loaded flagship

issan’s Micra has officially gone tech-savvy with the release of what the Japanese automakers referred to as the Acenta Plus Tech derivative that packs in an array of gizmos aimed at making life both easier and safer. These fall under the brand’s suite of technologies that it likes to call ‘Nissan Intelligent Mobility’ and which, in plain English, refer to a range of driver assistance features made possible by four cameras positioned strategically around the car. The key feature here is the Around View Monitor, which through the 17.8cm screen gives the driver a 360-degree ‘birds eye’ view around the car to make parking easier.The system includes ‘moving object detection’, which warns the driver about possible nearby hazards when parked or waiting at an intersection. Also included in this tech deal are the ‘blind spot warning and intelligent forward emergency braking (which can theoretically warn of an impending frontal collision and then assist

Axxela reiterates drive to promoting road safety in Lagos

with the braking if there was no timely reaction). Another feature exclusive to this model is a keyless activation system with push-button start. Like the Acenta Plus derivative that it’s based on, the Tech comes with a touch-screen

infotainment system compatible with apple carplay, but android auto connectivity has been added too, and there’s a dedicated Siri button on the steering wheel. Power, as per the rest of the range, comes from a Renault-

sourced 0.9-litre, three-cylinder turbopetrol engine, good for 66kW and 140Nm. Do bear in mind, however, that a perkier 1-litre turbo is set to replace that motor as a running change during the course of 2019, so you might want to wait for that.

xxela Limited sponsored and participated in a drivers’ interactive workshop organised by the Lagos State Ministry of Transportation and the Lagos Chamber of Commerce and Industry. Titled “Promoting Road Safety in a Smart City,”, the workshop enabled stakeholders discuss issues pertaining to the training, certification, and safety of all professional drivers within the private and public sectors across the state. Ladi Lawanson, Lagos state Commissioner for Transportation, while delivering his welcome address said, “This event is a strategic step towards the achievement of the goals of the United Nations Decade of Action which, in its second pillar of action, recommends aggressive public enlightenment, training and re-training of all categories of road-users towards engendering safer roads for all. It is important to complement the Bus Reform Initiative and road infrastructure developments of the state government by making necessary efforts to educate road users on the rules and regulations, as well as the consequences of violations of those rules. We believe that road safety is a priority and everyone’s responsibility.” On the significance of the event for Axxela, Henry Sanyaolu, Regulatory Liaison Manager, said: “As an organisation with a firmly entrenched safety culture across our business enterprise, we believe that collaborative efforts by relevant government agencies and private institutions promote road safety discipline within the metropolis. We are extremely delighted to regularly participate in sensitisation programs which improve the safety and wellbeing of Lagos state’s denizens”. Held at the state secretariat, Alausa, the event was attended by stakeholders from the public and private sectors, including Babatunde Paul Ruwase, director-general, Lagos Chamber of Commerce and Industry; Boboye Oyeyemi, Corps Marshal of FRSC; the general manager of Lagos state drivers’ institute Chris Olakpe, chief executive officer of the Lagos State Traffic Management Authority (LASTMA).

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Global rail focus could cut transport emissions- IEA MIKE OCHONMA

mikeochonma@gmail.com

here are very indications that stepping up investment in rail infrastructure could substantially reduce transport sector carbon emissions and energy consumption, according to a report published by the International Energy Agency (IEA). According to The Future of Rail report, which was prepared in cooperation with the International Union of Railways (UIC), rail is one of the most energy efficient transport modes but is often neglected in public debate. The report notes that rail is responsible for 8 percent of global passenger transport and 7 percent of freight transport but represents only 2 percent of total transport energy demand.

Rail consumes less than 600,000 barrels of oil per day representing around 0.6 percent of global oil use, and around 290 terawatt-hours (TWh) of electricity, around 1 percent of global demand. Fossil fuel combustion from rail operations accounts for around 0.3 percent of the global total. “The rail sector can provide substantial benefits for the energy sector as well as for the environment. By diversifying energy sources and providing more efficient mobility, rail can lower transport energy use and reduce carbon dioxide and local pollutant emissions’’. Says Fatih Birol,IEA executive director. Under the base scenario considered in the report, global annual investment in rail infrastructure will reach $315bn in 2050 based on projects already planned or under construction. In this scenario, the rate

of infrastructure expansion is fastest in the urban rail sector. The report notes that the total global length of metro lines under construction or planned for the next five years is double the length of any five-year period between 1970 and 2015. As a result, passenger numbers on the world’s urban networks are projected to be 2.7 times higher in 2050 than they are today. The strongest growth is in India and Southeast Asia, where there will be an almost seven-fold increase in ridership. China will see a three-fold increase with a 25 percent rise in Japan and 45 percent in the European Union (EU). In the high-speed sector, China will account for nearly half of new line construction over the next 30 years. Correspondingly, passenger numbers on the Chinese high-speed network will triple by 2050, rising 85 percent

in Japan and 66 percent in the EU. The report highlights massive growth on India’s main line network, where construction of new infrastructure will support “volumes of passenger activity that, by 2050, are unparalleled anywhere in the world.” India is expected to account for 40 percent of global passenger rail journeys by 2050. Rail electricity use is forecast to reach nearly 700TWh by 2050 and 97 percent of passenger rail movements and two-thirds of freight movements will be on electrified lines. However, despite the projected growth, the report finds that rail’s share of the passenger transport market will remain static relative to road and air transport. To explore how the benefits of rail might be optimised, the report puts forward a so-called High Rail Scenario

(HRS). This is built on three pillars that includes one; Minimising cost per-km by maximising network usage, removing technical barriers, and integrating seamlessly with other modes; two maximising revenues, for example by exploiting land value capture around stations to finance rail investment, and three; implementing policies that ensure all modes pay for the impacts they generate through road pricing, fuel taxes and congestion charging in urban areas. Under the high rail scenario, passenger rail activity is projected to reach a level 60 percent above the base scenario in 2050 with a 14 percent rise in freight activity. Urban rail usage could be 2.6 times higher than the base scenario and high-speed traffic could be 85 percent higher. This scenario would require global annual invest-

ment of $ 770bn in 2050, a 60 percent increase compared with the base scenario. This would include an extra $190bn for urban rail and $70bn for high-speed. However, these investments could reduce global fuel expenditure by around $450bn in 2050, including $64bn in India alone. The report says that “aggressive, strategic deployment of rail” would enable global transport CO2 emissions to peak in the late 2030s. If the High Rail Scenario became a reality, oil consumption could fall by 10 million barrels a day by 2050, with a 0.6 gigaton reduction in CO2 emissions and a 220 kiloton drop in particulate emissions. Furthermore, electricity consumption would be 360TWh higher than the base scenario, an increase roughly equivalent to the total electricity consumption of Thailand and Vietnam.

‘New urban mobility solutions requires greater regulation’

n today’s transportation system in Nigeria particularly, the financial challenges of owning a car especially in terms of maintenance, high petrol prices and stress of driving on traffic invested roads as well as the problem of securing a parking space in some and urban congestion that has not shown any signs of improvement are increasingly putting people off. This is more so when issues of environmental concerns are also encouraging people to move

away from personal transport based on the internal combustion engine and embrace green and shared mobility options. One of the problems confronting Nigeria’s multimodal transportation system, just like in many developing African or other third world countries, is the accessibility of passengers using the train to easily get to their destinations due to the distance between the train station and the airport or even the bus terminals. This is reflected in a variety of trends in dif-

ferent countries around the world. Populations are becoming ever more urbanised making it easier for people to access public transport infrastructure. For example, 29 percent of Italy’s population now

lives within 1km of a station and 73 percent are within 5km. Young people in particular are also not as struck by the thought of owning a car as much as previous generations. In Sweden, just 10 pr-

cent of 18-year-olds in Stockholm have a driving licence. And in the United States, the bastion of car ownership, the number of 16-year-olds applying for driving licenses has dropped by 50 percent in the last decade. In Nigeria for instance, the number of driver’s license applicants in terms of percentage within this age brackets is very wide. While trains are able to deliver large volumes of people quickly and effectively from point to point, passengers’ homes or offices are often some dis-

tance from the station, and when it comes down to a straightforward choice, it is hard the match the convenience and flexibility of simply jumping in your car and turning the key. In the past, people have been reluctant to embrace shared mobility because the level of service is perceived to be inferior to that offered by the private car. However, digitalisation and smart taxi services offered by operators to providing seamless inter and intra shuttle options are providing the means to bridge this gap.

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Swiss Re’s net income down over huge claims

L-R: Blessing Ebizie, head, Internal Audit, FBNInsurance; Elizabeth Agugoh, head, Marketing and Corporate Communications, FBNInsurance; Lawrence Okon, co-ordinator of Programmes , Down Syndrome Foundation Nigeria; Adeola Ajala, accountant, Down Syndrome Foundation Nigeria; Moruf Apampa, executive director, Business Development, FBNInsurance; Jacqueline Agweh, head, claims, FBN General Insurance and Mr. Emeka Anazia, Head, Learning and Development, FBNInsurance, at the gift presentation to the Down Syndrome Foundation Nigeria.

NAICOM to hold directors, external auditors accountable for company failures …reviews new Code of Corporate Governance for implementation Stories by Modestus Anaesoronye

nsurance industry regulator, the National Insurance Commission (NAICOM) said it will hold board of directors of insurance companies and their external auditors accountable for company failures, as a result of lack of proper risk management and also corporate governance failures. The commission said this has become necessary to protect policy holders and shareholders, as well as to ensure that trust and confidence is restored in the insurance business. Sunday Thomas, deputy commissioner for Insurance, Technical at NAICOM who dropped the hint in Lagos said the Commission was going to be critical with disclosure forward and in conformity with global regu-

latory standard. He said a lot of attention will be paid to risk management in its regulatory plan for 2019, stating that NAICOM plans to review the new Nigerian Code of Corporate Governance and see what can be implemented in the insurance industry. Joe Irukwu, professor and icon of the Insurance industry, in a forward written on Insurance Industry Code of Corporate Governance in 2009 had said: “The intractable problem of risks and uncertainties has been the greatest challenge to humanity on this planet, from time immemorial. This problem has remained unresolved despite the great advances that we have witnessed in the areas of science and technology. “ “From the social and economic viewpoint, insurance was the most ingenious creation of the human mind in response to this risk

problem. For well over 2,000 years, the insurance concept has been universally recognized as a vital factor in the protection of the national economy since no modern economy can function efficiently without the support of a viable and disciplined insurance industry”. Irukwu said in recognition of this situation, most modern governments attach great importance to the quality and efficiency of their insurance industries. This explains why it has become imperative for each country to have an efficient insurance regulatory system to supervise the activities of the insurance industry. According to him, this concept of an insurance regulatory system was first embraced by Nigeria, on a modest scale in 1961 under the provisions of the Insurance Act of that year. With the expansion and increased sophistication of insurance

business in Nigeria, a regulatory agency under the name of the National Insurance Commission (NAICOM), was created to perform this service as well as other services embodied in the enabling Act. “The present leadership of NAICOM has embarked on some positive steps in order to promote the quality and efficiency of the insurance industry, for the benefit of insurance consumers and the national economy. The most recent of these positive innovations from NAICOM is the introduction of a Code of Business Ethics and Principles on Corporate Governance for the Insurance Industry which I have read with great interest. Undoubtedly, if its principles are enforced, we will certainly have a first class insurance industry that would be as good as any of the best in the insurance world, Irukwu argued.

lobal reinsurance giant Swiss Re has reported Group net income of $421 million for the full-year 2018, as estimated large claims of $3 billion significantly impacted the performance of both its property and casualty reinsurance (P&C Re) and Corporate Solutions’ units. Swiss ReAs well as the hit from catastrophe events in 2018, which, according to the Swiss Re Institute was the fourth costliest year for the insurance industry, the reinsurer’s 2018 net income was also impacted by an estimated $599 million, pretax, related to a change in US GAAP accounting guidance. $2.2 billion of the firm’s large claims bill for the year came from natural catastrophe events, including typhoons Jebi and Trami in Japan, hurricanes Florence and Michael, the Camp and Woolsey wildfires in the U.S., a windstorm in Canada, and also a hailstorm in Australia. The remaining $800 million came from man-made losses. Despite the significant hit from large claims, Swiss Re’s net income in 2018 grew to $421 million, compared with $331 million a year earlier. Excluding for the impact of the above mentioned change in US GAAP accounting guidance, and Swiss Re’s 2018 net income would have reached $894 million. The reinsurance giant’s gross premiums written (GWP) increased by almost 5 percent in 2018, hitting $36.4 billion, which was mainly driven by premium growth across its life and health businesses. Swiss Re Group Chief Executive Officer (CEO), Christian Mumenthaler, commented: “There was no respite from large nat cat events and man-made disasters in 2018. Our fi-

nancial strength enabled us to support our clients in these tough times. It was the second challenging year in a row for the industry and us. “Our P&C businesses were heavily impacted by the events. Corporate Solutions’ results were disappointing. But even in challenging conditions, I am optimistic about Swiss Re’s future. In the January renewals of our P&C Re business, we were able to grow while keeping our running costs flat. We expect further price improvements in the renewals later this year, especially in the loss-affected markets.” By segment, the reinsurer’s P&C Re unit, which was substantially hit by large claims, recorded net income of $370 million in 2018, with a return on equity (RoE) of 3.7 percent and a combined ratio of 104 percent. Corporate Solutions, which was also hit by the firm’s large claims bill, fell to a net loss of $405 million in 2018, recorded an RoE of -19.4 percent and a combined ratio of 177.5 percent. Swiss Re’s Life and Health unit recorded net income of $761 million in 2018, driven mostly by large transactions in Canada and New Zealand and solid performance in Asia and EMEA. The unit recorded an RoE of 11.1 percent for the year, and GPW of $14.5 billion. Interestingly, the firm also comments on its experience at the January 1st 2019 renewals, underlining a strong outcome of its P&C Re renewals supported by large transactions. The firm renewed $10 billion compared to $8.4 billion a year earlier, while price quality increased by 1% with improvements most pronounced in the loss-affected property and casualty lines. The reinsurer expects further rate improvements at the forthcoming 2019 renewals.

Wednesday 27 February 2019

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In Association with

PenCom pushes for compliance on group life, empowers employees

ension industr y regulator, the National Pension

in their favour; submit the evidence of compliance with life insurance policy to the Commission and place the certificate in a conspicuous place within the organisation; and remit the deducted pension contributions into their Retirement Savings Accounts. In accordance with the provisions of Section 4(5) of the Pension Reform Act (PRA) 2014 and Section 5.5 of the Guidelines for Insurance Policy for Employees, Employer of labor covered by the PRA 2014 are required to submit copies of the Insurance Certificate with the schedule of benefits to the National Pension Commission (PenCom). The Insurance certificate should state that all employees are covered up to an amount not less than 3 times their respective annual total emoluments (ATE). Employers that have not yet submitted copies of Insurance Certificate for the current year to the Commission are therefore advised to do so before 31 March each year, failing which the Na-

RC634453

Diamond Pension Fund Custodian Limited 1A, Tiamiyu Savage Street, Victoria Island, Lagos State. Tel: 01-4613753, 2713680, 2713954 Fax: 01-2713955 Email: info@diamondpfc.com Website: www.diamondpfc.com

tional Pension Commission would consider such employers in default of Section 4(5) of the Pension Reform Act (PRA) 2014. It is the right of an employee to have a group life insurance. It is a scheme that can be likened to a death-in-service policy,

‘

Life insurance policy involves the payment of a premium to the insured against the death of an employee either by natural or accidental causes

‘

Commission(PenCom) has stepped up actions to enforce compliance on group life insurance, a provision in the Pension Reform Act 2014. The Commission by this move has made compliance on group life, to be like compliance on pension contribution and remittance by employers, which has also become a pre-condition for organization to participate in any federal government contract. PenCom in an advertorial on 20th February 2019 in some national newspapers titled ‘Notice To All Employees on Their Rights to Life Insurance Policy And Pension Contributions’ charged employees to demand for their rights. The advertorial reads “This is to remind all employees in the Public Service of the Federation, Federal Capital Territory and States that have implemented the Contributory Pension Scheme as well as private sector, that it is their rights; under section 4(5) of the PRA 2014 to have life insurance Policy taken on their behalf by their employers for an insured amount not less than three (3) times their annual total emolument.” “Please note that employees are also required to ensure that all pension contributions deducted from salaries and/ or contributed by employers are remitted to the Pension Fund Custodian (PFC) by the employer not later than seven working days from the date of payment of their salaries”. The Commission therefore advised employees to report to the Commission where the employer fails to procure the minimum required life insurance policy

designed to pay a benefit called the sum assured to the next of kin or dependants of an employee who dies in active service. Life insurance policy involves the payment of a premium to the insured against the death of an employee either by natural or accidental causes. It is wholly paid for by the employer and enjoyed by the employee if the death occurs prior to terminal date. The policy also can provide for accident at work that results in permanent disability as well as cover for burial expenses by way of extension to the policy. It therefore demonstrates to employees that the employer places a great premium on their lives and contributions to the development of the organisation. The objective of the Pension scheme is to establish a uniform set of rules, regulations and standards for the administration and payments of retirement benefits for the public service of the Federation, the Public Service of the Federal Capital Territory, the Public Service

of the State Government, the Public Service of the Local Government Councils and the private Sector.” It is also aimed at making provision for the smooth operations of the contributory pension scheme; ensure that every person who worked in either the public Service of the Federation, Federal Capital Territory, States and Local government or the Private Sector receives his retirement benefits as and when due ; It is to assist improvident individuals by ensuring that they save in order to cater for their livelihood during old age. The provisions of this Act shall apply to any employment in the public service of the Federation, the public Service of the Federal Capital Territory, the Public Service of the state, the public service of the local governments and the private sector. In the case of the Private Sector, the Scheme shall apply to employees who are in the employment of an organization in which there are 3 or more employees.

This section is created to increase awarness and deepen knowledge about the contributory pension scheme. If you have enquiries or contributions, send to this e-mail: diamondpfcbusday@yahoo.com

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Farmers still struggling to embrace insurance despite growing risks Stories by Modestus Anaesoronye

ost of the farm risks that crystallised in different parts of the country particularly late last year as a result of flood where without compensation from insurers. They reason is that farmers were yet to see need for protection, and so find it difficult to part with premium for risks management. Sahel Advisory Services, agricultural consultants had stated that framers and stakeholders in the agricultural value chain have failed to maximise the inherent benefits in taking up insurance for their crops and businesses due to lack of awareness. In a report on ‘Key constraints and mitigating strategies to improve stakeholder involvement in the agricultural insurance space’, Sahel Advisory Services observed that farmers and agribusinesses are unaware and have a limited understanding of the benefits of insurance in managing risks. In addition, they do not believe they will receive compensation for losses incurred. They however suggest

L-R: Klaus Augenthaler, 1990 World Cup winner and FC Bayern Legend; Ibitunde Balogun, head of Research, Strategy and Projects at Allianz Nigeria; Lars Weichert, FC Bayern brand manager; Victor Edeh, founder of VOE Foundation and FC Bayern Youth Cup Nigeria tournament director during a courtesy visit to Allianz Nigeria Lagos office

that in order to build trust among farmers and agribusinesses, insurance providers must develop products that are easy for

the users to under-stand and will leave little room for misinterpretation. In addition, insurance providers should organize

extensive training sessions to educate users on the importance of using various insurance products for risk management, they

experts stated. They also argues that infrastructure such as feeder roads and proper communication facilities are required to facilitate prompt claims reported by farmers to ensure the assessment of losses by the appropriate authority Leveraging on technology solutions, they said insurance providers should partner with mobile providers to leverage on existing networks to farmers. “Furthermore, they can also work to identify aggregators that work with large group of farmers that will benefit from insurance.” Access to credit they observed is critical in building capacity for the farmers and motivations for insurance cover. “Agricultural insurance is costly for both farmers and insurance companies. Most of the farmers knowledgeable about insurance products are unable to access it due to lack of funding.” Bundling insurance products with credit and input suppliers will be of immense benefit to building the value chain. Insurance providers should partner with stake-holders such as MFIs and commercial banks that lend to clusters that would benefit from such partnership.

On poor data management, the argued that in order to compute premiums and pay indemnities, insurance providers require up-todate information on farm operations, particularly crop yields and losses from natural disasters. Most farmers do not have this in-formation and this makes it difficult for insurance providers to adequately assess claims. Encouraging data management, it said “Depending on the specific insurance product, insurance providers will need to educate farmers on the adequate methods of recording crop yields and losses. In addition, product users require adequate technology to enhance the data management process. For the public level insurance scheme, products are offered at a subsidized rate while private level insurance products are fully commercial. Creating synergies between private and public level insurance schemes will help the system “A collaborative effort is required by both parties in order to promote the importance of agricultural insurance and target a large majority of farmers and agricultural businesses.”

African Re again set to reward innovative, ethical insurers in the continent

frica Reinsurance Corporation (Africa Re) is set to reward insurance companies and personalities in the African Insurance Market that have contributed to the development and growth of the continents market in the past one year. The award, 5th in the series will focus on innovation, corporate governance and good leadership in the business and operation of insurance business. The African Reinsurance Corporation (Africa Re) announcing the entries for the 5th edition of the African Insurance Awards., said the objective of the Awards is to reward and celebrate innovation, good corporate management and good leadership in the African

insurance industry. The 2019 edition will take place on Monday 10 June 2019 in Johannesburg, South Africa during the African Insurance organisation. There are four categories of Awards in this year’s edi-

Corneille Karekezi, CEO, Africa Re

tion. These include Insurance Company of the Year: This prize is open to all insurance companies registered in Africa and focusing on performance in the last 2 years. CEO of the Year: This special award is given to the CEO

of a company, who has made an outstanding contribution over the past 12 months or more, either through the advancement of his/her company or the insurance industry in Africa. Innovation of the Year: This prize is awarded to an insurance company for the best use of technology, for launching a breakthrough product / service or a new and innovative distribution channel or method. InsurTech Breakthrough: This prize targets non-insurers that are collaborating with insurers to improve customer service delivery, product development and overall innovation in the insurance value chain. Africa Re will provide a platform for winners to meet the insurance industry.

FBNInsurance extends CSR to Down Syndrome, Heritage Homes

n line with its Corporate Responsibility and Sustainability initiatives, sister insurers, FBNInsurance and FBN General Insurance, recently donated various items to two care homes, the Heritage Homes and The Down Syndrome Foundation. The companies spent the Valentine’s Day with the Children at the Heritage Homes and donated various food items, beverages, cash gift to the home. Also recently, both companies made similar donations to the Management of The

Down Syndrome Foundation. Most of the items donated were largely raised through the companies’ annual Staff Gift drive, an inhouse scheme that encourages members of staff of both companies to donate various items to a common cause. At the presentation ceremonies, Moruf Apampa, the executive director, Business Development, FBNInsurance reassured the homes of the insurers’ commitment to support the cause of both organizations in making the society a better place.

PrivateEquity & fundraising 27

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Private equity giants are pulling out from African investment Nigeria tops preferred destination for investment in Africa MICHEAL ANI

lobal giants in the private equity space are divesting their investments from the African market no thanks to interest rates hike in advanced countries and the harsh operating environment that has dealt a steeper blow on emerging market stocks. Just recently, the Blackstone Group L.P, an American multinational private equity, announced plans of selling its African focused subsidiary, Black Rhino Group, back to management due to the little growth recorded by the firm so far since the 2014- 2015 fundraising boom that brought many firms into the market. In 2014, the New York-based PE firm acquired control of Black Rhino to invest billions into energy and infrastructure projects in Nigeria and Ethiopia but failed to seal the deal due to an undisclosed reason. The aftermath of the acquisition of Black Rhino was a deal it sealed in 2018 when it led a consortium of investors to acquire a 55 per cent stake risk and financial businesses Thomson Reuters Corporation, a world-leading data and financial technology platform. The mismatch between the size of available deals in African markets and the target investment size of global asset managers of Blackstone continues to be an issue. Blackstone’s later resorted in departing from the African market joining other top American PE players like the KKR in leaving the market. In late 2017, KKR disbanded its Africa team after making only one investment on the continent, in 2014, of $200 million in the world’s largest rose farm, Afriflora that it has since sold. Carlyle Group an American multinational private equity, was another firm that got the sour taste of investing in the continent after it invested in one of Nigeria’s tier 2 lender, Diamond bank. At that time, the US-based PE firm said it was well-positioned to benefit from Nigeria’s status as one of the fastest-growing economies on the continent and enthused how it could become one of the largest financial institutions in West Africa. While Carlyle closed a $698 million fund dedicated to Africa in 2014, its flagship investment in Nigeria’s Diamond Bank failed to perform, with its shares fall over 90 per cent since Carlyle invested $147 million.

The trigger for the collapse was as a result of the 2014 oil-price crash, and restiveness in the Niger Delta region that crippled growth in the economy since Nigeria built its economy around oil. This moribund state started just as Carlyle made its investment. The recession hammered Nigeria’s economy and caused nonperforming loans to soar which affected the quality of most banking assets with Diamond bank inclusive. Growth at that period was 0.8 per cent, having averaged more than 6 per cent in the first half of the decade. The diamond bank finally went under the carpet in a merger with a tier 1 lender, Access bank. A lot of blockbusters happened in Nigeria’s business landscape in 2018, from a backlash between its apex financial regulator and it’s largest non-oil direct investor that controls about 39.7 per cent market share and service about 66 million subscribers in Nigeria’s telecommunication sector, to the closure of local offices of two global lenders. The CBN in August fined four

banks a total of ₦5.86 billion for breaching Nigeria’s extant laws and forex rules when they facilitated illegal repatriation of funds to South Africa on behalf of MTN. The CBN then asked MTN Nigeria to immediately repatriate a total of $8.134 billion, being part of funds that were illegally taken out of Nigeria by the telecom company between 2007 and 2015. The telecom firm was also slammed US$2bn in tax arrears on imported equipment and payments to suppliers from the office of the Attorney General of the Federation. This CCI fiasco sent a negative signal to investors who raised eyebrows on the way and manner the apex bank handled the situation, pushing FDI to N379.84 billion($1.2 billion) in the first half of the year from 532.63 billion nairas ($1.7 billion) a year earlier, according to CBN half-year data. Global lender UBS closed its Nigerian office after it expressed dissatisfaction over the way and manner the apex bank brought its hammer on the telecom giant. In the same manner, HSBC shut down its operations in Nigeria

over several backlashes from the government after it predicted that Nigeria’s president Buhari’s victory in the 2019 elections would stall the economy. Foreign Direct Investment into the country declined 36 percent from $3.5 billion to $2.2 billion in 2018, according to a report from United Nations Conference on Trade and Development (UNCTAD), making it the lowest foreign inflows that Africa’s largest economy has recorded in the last 13 years when the Geneva-based permanent intergovernmental body started tracking FDI data across the globe. However, despite all the hurdles, Nigeria has remained an investment decision for investors in the continent due to its large and diverse population. “A country like Nigeria, with a population of 198million, has a number no investor will ever want to ignore”, Jimoh said at the sideline, when the bank partnered the Chattered financial Analysts (CFA) society in attracting investment in Nigeria.

A higher proportion of Private Equity (PE) investors see Nigeria as the most viable destination for investment over the next three years, according to a survey by African Private Equity and Venture Capital Association (AVCA). The survey showed that 58 per cent of the Limited Partners (LP) surveyed said they see Nigeria as an attractive country for PE investment in Africa, followed by Kenya’s 40 per cent and Egypt’s 31 per cent. Rafiq Raji, the chief economist at Macroafricaintel, while responding to the survey said Nigeria is an ideal destination for PE investors, due to its vast amount of untapped resources. “Demographic is one of the reasons why Nigeria is viable for PE, alongside aspirational culture as there are untapped sectors like tourism and outsourcing/backoffice services which is virtually a potentially lucrative opportunity,” Raji told BusinessDay. South Africa came to the fourth most popular option amongst LPs; an improvement from 2017, when the country was the 8th most popular option amongst LPs. “If you want to be a relevant player in the African market, you need to have a presence in Nigeria”, said Benoit Claveranne, CEO International & New markets for Axa Group. Carlyle still reportedly invested $40 million into an online ticket travelling agency Wakanow. In 2017, roughly 90 per cent of Africa-focused PE fund sizes were over $100 million, yet only about 15 per cent of African private companies reported revenue over that number. Moreover, the typical PE time frame of a five-year holding period is often too short in African markets, where companies require more wholesale change, currency risk is a challenge, and exit opportunities are limited. As global PE giants leave the region, Africa-focused firms continue to grow. DPI, for example, is in the process of raising a third fund with an $800 million target. DPI and competitors like ECP, Helios, Actis, and Ethos tend to focus on smaller deals, often between $70 million and $100 million. Funds that successfully tap opportunities in some of the world’s fastest-growing markets tend to share the traits of Africa specialization, patient capital, and tolerance and capacity for smaller assets. The big U.S. players appear uninterested in adapting to these realities in the near term.

BusinessDay PRIVATE EQUITY & FUNDRAISING (Team lead: LOLADE AKINMURELE - Analysts: MICHEAL ANI, DIPO OLADEHINDE, ENDURANCE OKAFOR, DAVID IBEMERE ... Graphics: OGAR DAVID ) Businessday’s Private Equity and Fundraising section is a weekly publication that provides in-depth analysis on private equity trends and tracks deal activity in Nigeria.

Email the PE & F team loladeakinmurele@gmail.com

Continues on page 34

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Ignite your passion - 2

Relationship Management is Key to the success of your business - Sandra Tuboberini

ntroduction: Sandra Tuboberini is founder of Tubo, a fashion brand in Nigeria with a focus on delivering high-end garments for women with impeccable taste. Tubo earned the spotlight after the release of her first collection ‘le premier collection’ in 2016 and since then she has being featured on international platforms like Al Jazeera. According to Tuboberini, the Tubo woman is bold, sexy and empowered. She shares how owning a business changed her perception on relationship management and how she has continually worked to get better at it. My name is Sandra Tubonerini I am an entrepreneur and I am in the fashion and arts industry. The name of my company is Tubo Clothings Nigeria Limited the brand name is ‘Tubo’ I have only being here for about two years and the half so I am quite new in the industry. MY LIGHTBULB MOMENT My light bulb moment was when I realised that even though I was good at finance which was what I studied in school, I have an MBA in finance and a B.sc in Economics I just realised that regardless of what I did or what I succeeded at doing at the time, I wasn’t as happy as when I was doing my hobby whether or not I was making money out of it or not. I started off making clothes at a very young age with my mum who was a seamstress and I wouldn’t say I was doing it because I loved it at the time. Sometimes it was because my mum was forcing me to do it but I grew up loving it I grew up making a business out of it even

turn against me. But I have come to understand that you need to find individual needs of each of your workforce, each of your staff and be able to attend to them individually. Understand what their problems are, understand what they need because sometimes, it’s not all about money. You cannot really pay for the services that people render to you. It is what is inside of a man that he gives to you. If it doesn’t come, you can’t buy it, it comes out willingly so it’s how you treat people beyond how much you pay them or it’s how you cater to their individual needs that makes them stay with you.

right from secondary school I was making uniforms for people and I was making money out of it. When I got to the university, I was supposed to do an MBA in finance and at some point I wanted to change into MBA fashion. I made a fuss about it and what they did was that they let me go for fashion events with the fashion students; they let me travel with them to Paris for all their excursions, museums and all with the fashion students. But I did well in finance and went into the corporate world. I woke up one day and just realised that it wasn’t making any sense because I would close from work and I would still come back home to sew for clients and I wasn’t so happy in the corporate environment and I told myself you know what, I am just going to do this full time and I am going to be happy doing this, doing my passion and being happy about what I do and not doing it because I want to make money, I want to live well but because I want to invest in my happiness.

LESSONS LEARNED IN BUSINESS The biggest lesson I learnt was I literally lost my entire workforce. It felt like a joke, it felt like I was dreaming, I was devastated, I was frustrated I literally came to work and they were all gone and I did not know where to start from. I was confused I had to manage the situation. It has taught me how to hold on to people and manage people well and right now I feel like I do that so well. Like relationship management is very important to me. THE BIG MISTAKE The biggest mistake that I have made which is connected to the biggest challenge I have had, was placing one person above the other ones and putting so much power into the person’s hand such that it looked like I didn’t have control over the rest of them. It seemed like I had another boss so it was so easy for the person to just talk to the other people and make them

BREAKING BOUNDARIES MOMENT So my breaking boundary moment will be when I finished my first collection which is the ‘le premier collection’ It will sound like this is supposed to be easy for a fashion designer, but for me I have always struggled to balance creating a collection and trying to manage customer needs and all of that. There are just so many things to consider. You do five pieces and put it on the rack and somebody comes, buys it and then you’ve forgotten about the collection you move on to another one. So I’ve being trying to come up with a collection for ages and having done this, I feel everything has become real and I think the lesson I’ve learnt from this is that when you as an entrepreneur set goals, when you set targets you should put your mind to it and try to finish it at once. Try to finish that thing so you move on to the next level because the first collection actually brought me a lot of media attention. It’s almost like I have grown to the next level, it’s almost like I have achieved something really great like I have achieved something

important in my business. MY MANTRA Succeeding in creating the first collection, the ‘le premier collection’ taught me that relationship management is key. Relationship whether it is with my staff, relationship with my customers, my suppliers and just people in the industry. I feel like that has become my mantra; relationship management has become the most important thing to me. I feel like when you have good relationships with people you spend less money. Relationships whether it is with my team, with my suppliers, relationships with my customers I feel relationships will give you things that money cannot buy. Relationships are very good, they are very key; people are very important, people are key to your business. If you really need to succeed you need to treat and appreciate people. About Aim Higher Africa Ignite Your Passion The Aim Higher Africa Ignite Your Passion Series is an edutainment web-program under the Aim Higher non-profit organization. This series shines a light on millennial entrepreneurial leaders in different industries who have overcome economic challenges and built businesses that are transforming their communities as well as making global economic impact. With the vision of bridging the gap between poverty and prosperity, we hope that through this series, aspiring entrepreneurs will be able to identify their passion and turn them into business ventures that will in turn enrich their communities by creating employment opportunities.

How to stay passionate about your brand

hile some people are able to convert the talent they are very passionate about into business, others learn to develop this passion for what they do one day at a time. Initially, there is this excitement and euphoria about being an entrepreneur and being your own boss as you dazzle the world with your unique products and services but as the work begins to kick in, some people get stressed out and begin to think if they should go ahead with this entrepreneurship thing. After all, not everyone is cut out to be an entrepreneur and suddenly the 9 - 5 job doesn’t look so bad. True, most of us would like to determine our work hours and have freedom for other things but how determined are we to put in the work? How prepared are we to keep fanning the flame especially when faced with challenges we think we can’t handle? Here are some tips on how to be and remain passionate about your brand: Your passion is contagious: If you want your customers to be just as excited about

your business, you have to show that excitement first and it would be caught from you. You can’t go about looking all bland and tired about the business and expect your customers to react otherwise. It doesn’t work that way. Your customers are only excited when they see how excited you are about what you are offering them. Understand your values: Even though every business niche is almost full, it is important to always remember that your competition is not your next door neighbour in that same business but yourself. Understand the values you are offering to your customers through branding. This shows your relevance to your market and makes you as well as clients emotionally attached to your brand. Don’t try to copy others. Be true to yourself and stay original. Nothing triggers passion as much as originality. Identify your target market: No matter how much you want to, you can’t be everything to everyone. Streamline your focus on your target market by identifying who benefits the most from

the products or service you offer. Your business wouldn’t please everyone because not all needs it. Stop trying to rationalise why this is so instead focus on the group that needs it the most. This knowledge fuels your emotion and passion for your business and enables you to concentrate your energy and marketing on pleasing your identified target group. Your voice, Your brand: Just as the story of everyone’s life is different, so it is with businesses. The story of your business is one of the most important things when creating your brand. Your story is not only beneficial to your customers but you as the owner. It makes you understand more of how you started and is a constant reminder of where you are coming from and where you are headed. At those times when you feel like giving up, your story is always there to re-ignite your passion and keep you going. Be your own business narrative. Don’t copy others. Own your voice and own your brand. This makes all the difference.

Dialogue with your customers: Today’s customers are just as smart as business owners. You can’t easily sway them with just a couple of words and expect to earn their trust. Learn to talk with them. Be honest with them about your business especially when you make mistakes. Take responsibility and not make excuses. Earning your customers loyalty, knowing you have an actual connection with them and you are impacting value in their lives would fan the fire of your passion. You would not only feel relevant but also appreciated. Discipline and focus is key: Always take time to weigh your decisions about your business so you do not drift off from your designed mission and vision. While you may be tempted to do so much, narrow your gaze on the immediate thing you are trying to accomplish and how you would get it. You don’t want to dilly-dally and as such lose time and resources while achieving nothing. Being disciplined cautions you from being all over and is able to curtail your focus

to your set goals. It also helps you to meet up with set deadlines. What is your why?: Not knowing this is one of the reasons why most businesses crumble and why one’s passion can easily lose its flame and burn out. If you don’t know the reason why you are in business then you have no reason to be. This is because once the initial excitement and glee wears off, you are faced with the true reality of things - lack of purpose. Just like your brand story, understanding why you in this business is one way to constantly keep your passion ignited. With this, you are able to form a meeting point or community, if you will, with your customers. Knowing your why becomes the bond that unites your business with your market. See? Keeping your passion aflame in your business isn’t as difficult so long as you understand what you and your brand are all about. Being deeply convinced about what you want and what you intend to achieve is what would keep you flying high even in the face of obstacles.

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Wednesday 27 February 2019

CITYFile

Business activities paralysed in Ekiti abattoirs

ood vendors are experiencing low sales in their business as all activities were paralysed in most of the abattoirs in Ekiti following the death of the state chairman of the butchers’ association, Aliu Nurudeen. At the main abattoir along Iworoko road, Ado-Ekiti, where cows are slaughtered for wholesale and retail, customers who were at the market on Monday hoping to buy meat were disappointed as butchers stayed away from the market. Two of them, Deola Monilola and a food seller, Ayoola Aduloju, expressed dissatisfaction over the development, saying they would not be able to get meat for their customers and family members. Also, some food sellers at the abattoir said that the death of the chairman would rob them of the opportunity to make money today, with the fear that the food they had prepared would go bad. In an interview, one of the meat sellers, Musa Adigun, explained that the development was as a result of the death of their chairman, saying that business activities would resume on Tuesday across the state. Another member, Raheem Olorunoje, appealed to all their customers to bear with them, saying that they went with the remains of their chairman to pay their last respects to him.

Police arraign 4 for damaging car windscreens

he police in Oyo have arraigned four men before an Iyaganku Chief Magistrate Court in Ibadan for allegedly breaking the windscreens of five buses valued at two million naira. The four men are Johnson Fayemi, 20, Ridwan Omotosho, 25, Deji Ajayi, 20, and Biodun Agirifa, 30. The defendants are standing trial on a two-count charge bordering on conspiracy and willful damage. The defendants with others now at large allegedly conspired with others to commit the offence. The police prosecutor, Amos Adewale, told the court that Fayemi, Omotosho, Ajayi and Agirifa had willfully and unlawfully broken the windscreen of a Toyota Hiace bus with registration LG 12 DDA. “The defendants entered the compound of one Adeniyi Olowofela, an APC House of Representative candidate in Ido local government on February 2 at 11 p.m. to commit the offence.

In the absence of the trucks, the Tricycle ( Keke Marwa) becomes the king on the Apapa-Ijora Express Road dreaded for its notorious traffic. Pic by Pius Okeosisi

Immigration, others partner to curb trans-border crimes JOHN SALAU

he Nigeria Immigration Service (NIS) says it is collaborating with the Nigerian Army, Nigeria Customs Service, the Nigerian Navy, the Nigeria Police Force and other agencies to curb trans-border crimes. Dominic Asogwa, the Comptroller, Seme border command, disclosed while speaking with newsmen on efforts to curb crimes around the border. He said the service was vigilant to its responsibilities. Asogwa listed other agencies to include the Nigerian Air Force, Department of State Services, the Standards Organisation of Nigeria, the National Agency for Food, Drug Administration and Control and the National Drug Law Enforcement Agency. “We are not working in isolation, but collaborating with other sister agencies to achieve government directives on security, particularly at this time of general elections.

“Here in Seme, our team is working as a family with other agencies to curb crimes, especially trans-border crimes; and the cooperation has been wonderful as many serious crimes have been brought under control. “The Customs area controller in this command, Mohammed Uba, has directed that all security officers participating in the border closure monitoring exercise, be fed during the elections period. “This shows wonderful synergy and cooperation among us here, in spite of the fact that it falls under our purview to close the borders, but we have to carry others along,’’ he said. Asogwa said the command was also in partnership with the neighbouring country’s security agencies to ensure there are no loopholes in securing the country during the period of elections. “We have also extended the hands of fellowship to both the police and the Customs in the Republic of Benin. “The NIS is having a good deal of inter-departmental relationship, and we

participate mutually in activities that are affecting both countries.’’ According to him, the enormous effort the service is putting in combating transborder crime has helped in the drastic reduction of crime in the area. He, however, admitted that there was difficulty in curbing trans-border crimes as even developed countries like the U.S., were still struggling with trans-border crime. NAsogwa further said that the NIS Comptroller General Muhammad Babandede, has embarked on serious training of officers and men of the Service. “This time around, the officers have been trained and more conversant with their responsibilities. “That is why when some of the officers posted here already know what to do, this is one of the ways we check trans-border crimes. “We are trained to read the body language of people to detect who they are, that is why in a mix of people, we detect illegal immigrants,’’ he said.

Man charged with N1.7m visa fraud

Two docked over burglary, breaking of safe box

34-year-old man, Afeez Gbeleye has been charged before a Surulere Chief Magistrate Court in Lagos, over alleged N1.7 million Australian visa fraud. The defendant was charged with obtaining money under false pretences and stealing but pleaded not guilty to the two-count charge. The prosecutor, Anthonia Osayande, told the court that the defendant committed the offences on March 8, 2018 at the Randle Hospital, Surulere. “The defendant obtained N1.7 million from the complainant, Olamide

JOSHUA BASSEY

Oshadipe, on the pretext of securing an Australian visa for him,” Osayande said. She submitted that Gbeleye failed to procure the visa and refused to return the money, in contravention of Sections 287 and 314 of the Criminal Law of Lagos State, 2015. The chief magistrate, Oluyemisi Adelaja, granted the defendant bail in the sum of N300, 000 with two sureties in like sum. Adelaja ordered that the sureties should be gainfully employed and show evidence of tax payment to the Lagos State government. The case was adjourned until March 4 for substantive trial. NAN

wo men, Peter Otom and Elijah Akanbi, who allegedly burgled a shop and broke into its safe have been charged before an Ebute Meta Magistrate Court in Lagos. Otom, 27, Akanbi, 38, are facing trial over a three-count charge of conspiracy, break-in and stealing. The duo, however, pleaded not guilty to the charges. The prosecutor, Julius Babatope said that the accused committed the offences on February 22, at 2.00

a.m. at No. 28, Ibadan Street, Ebute Meta. He said that the defendants had burgled the shop of Emeka Nsofor and broken into his safe and had stolen a sum of N1.5 million. The offences contravene Sections 287, 307 and 411 of the Criminal Law of Lagos State, 2015. The magistrate, A.O. Salawu, admitted the duo to bail in the sum of N200, 000 with two responsible sureties each in like sum. She, however, adjourned the case until March 18 for mention.

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Wednesday 27 February 2019

Live @ the Stock exchange Prices for Securities Traded as of Tuesday 26 February 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. 180,799.82 6.25 -1.57 236 32,303,152 UNITED BANK FOR AFRICA PLC 273,595.37 8.00 -2.44 312 19,023,595 810,029.54 25.80 -0.77 382 14,541,075 ZENITH BANK PLC 930 65,867,822 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 287,162.34 8.00 -3.61 220 15,646,228 220 15,646,228 1,150 81,514,050 BUILDING MATERIALS DANGOTE CEMENT PLC 3,280,297.68 192.50 -0.21 52 253,091 112,754.57 13.00 - 56 514,530 LAFARGE AFRICA PLC. 108 767,621 108 767,621 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 364,247.18 619.00 - 3 110 3 110 3 110 1,261 82,281,781 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,900.00 95.00 - 0 0 11,300.89 45.20 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) UPDC REAL ESTATE INVESTMENT TRUST 15,876.20 5.95 - 3 13,290 3 13,290 3 13,290 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 3 13,290 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 2 902 76,360.50 80.05 - 10 4,810 OKOMU OIL PALM PLC. PRESCO PLC 75,000.00 75.00 - 12 25,846 24 31,558 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 511.20 4.26 - 1 2 1 2 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,890.00 0.63 8.62 7 354,626 7 354,626 32 386,186 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 900.08 0.34 9.68 3 184,721 JOHN HOLT PLC. 186.79 0.48 - 0 0 1,903.99 2.93 - 1 2 S C O A NIG. PLC. TRANSNATIONAL CORPORATION OF NIGERIA PLC 58,126.63 1.43 -3.38 139 17,596,292 25,355.41 8.80 2.27 31 436,973 U A C N PLC. 174 18,217,988 174 18,217,988 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 34,980.00 26.50 - 8 37,002 165.00 6.60 - 0 0 ROADS NIG PLC. 8 37,002 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 4,729.08 1.82 0.55 18 1,729,149 18 1,729,149 26 1,766,151 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 12,683.78 1.62 - 12 227,445 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 147,084.21 67.15 3.15 27 178,466 INTERNATIONAL BREWERIES PLC. 225,641.38 26.25 - 5 60,739 NIGERIAN BREW. PLC. 665,342.25 83.20 - 55 367,906 99 834,556 FOOD PRODUCTS DANGOTE FLOUR MILLS PLC 60,250.00 12.05 9.05 286 16,091,080 DANGOTE SUGAR REFINERY PLC 184,800.00 15.40 -0.65 46 1,700,850 FLOUR MILLS NIG. PLC. 82,007.59 20.00 - 32 84,852 HONEYWELL FLOUR MILL PLC 11,022.97 1.39 -0.71 42 2,473,928 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 1 2 NASCON ALLIED INDUSTRIES PLC 50,074.39 18.90 - 16 67,797 UNION DICON SALT PLC. 3,676.41 13.45 - 0 0 423 20,418,509 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 19,533.30 10.40 - 26 94,220 NESTLE NIGERIA PLC. 1,196,910.94 1,510.00 -4.43 42 53,346 68 147,566 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 3 3,002 VITAFOAM NIG PLC. 5,003.38 4.00 - 12 107,334 15 110,336 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 48,836.87 12.30 - 19 197,204 UNILEVER NIGERIA PLC. 247,035.23 43.00 - 16 48,320 35 245,524 640 21,756,491 BANKING DIAMOND BANK PLC 57,900.97 2.50 2.04 89 28,602,594 ECOBANK TRANSNATIONAL INCORPORATED 261,481.10 14.25 1.06 37 11,316,132 FIDELITY BANK PLC 69,539.51 2.40 -2.44 130 12,176,171 GUARANTY TRUST BANK PLC. 1,122,799.49 38.15 -0.13 253 17,765,872 JAIZ BANK PLC 17,973.19 0.61 - 15 317,962 SKYE BANK PLC 10,687.83 0.77 - 0 0 STERLING BANK PLC. 71,976.05 2.50 - 186 2,425,048 UNION BANK NIG.PLC. 193,653.01 6.65 -8.28 15 126,908 UNITY BANK PLC 11,689.34 1.00 1.01 10 589,313 WEMA BANK PLC. 32,788.30 0.85 -6.59 39 5,124,252 774 78,444,252 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 1 2 5,405.56 0.78 5.41 14 364,643 AIICO INSURANCE PLC. AXAMANSARD INSURANCE PLC 23,100.00 2.20 7.32 6 501,547 CONSOLIDATED HALLMARK INSURANCE PLC 2,276.40 0.28 - 6 22,602 CONTINENTAL REINSURANCE PLC 19,811.94 1.91 - 0 0 CORNERSTONE INSURANCE PLC 3,240.49 0.22 4.76 17 1,392,500 GOLDLINK INSURANCE PLC 2,183.97 0.48 - 1 2 GUINEA INSURANCE PLC. 1,228.00 0.20 - 2 40,002 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 2,416.73 0.33 - 6 343,572 LAW UNION AND ROCK INS. PLC. 2,362.98 0.55 - 3 28,572 LINKAGE ASSURANCE PLC 5,040.00 0.63 - 3 60,002 MUTUAL BENEFITS ASSURANCE PLC. 2,320.00 0.29 7.41 14 1,273,671 NEM INSURANCE PLC 13,201.26 2.50 0.80 18 665,966 NIGER INSURANCE PLC 1,857.48 0.24 - 5 13,504 PRESTIGE ASSURANCE PLC 2,906.58 0.54 - 1 2 REGENCY ASSURANCE PLC 1,733.88 0.26 4.00 8 2,091,000 SOVEREIGN TRUST INSURANCE PLC 2,252.02 0.27 8.00 61 11,125,102 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 - 9 50,807,100 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 1 2 VERITAS KAPITAL ASSURANCE PLC 3,466.67 0.25 8.70 6 1,116,102 5,754.58 0.43 - 12 955,555 WAPIC INSURANCE PLC 194 70,801,448 MICRO-FINANCE BANKS FORTIS MICROFINANCE BANK PLC 11,799.67 2.58 - 0 0 NPF MICROFINANCE BANK PLC 3,407.09 1.49 -9.70 11 2,005,002 11 2,005,002

MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,116.00 0.98 - 3 8,520 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,922.05 1.42 - 1 2 2,265.95 0.20 - 3 400,002 RESORT SAVINGS & LOANS PLC UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 7 408,524 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 9,680.00 4.84 10.00 116 6,625,963 35,879.37 6.10 - 10 61,581 CUSTODIAN INVESTMENT PLC DEAP CAPITAL MANAGEMENT & TRUST PLC 660.00 0.44 - 0 0 44,754.13 2.26 -3.00 134 10,430,660 FCMB GROUP PLC. ROYAL EXCHANGE PLC. 2,006.69 0.39 8.33 3 126,483 STANBIC IBTC HOLDINGS PLC 496,666.82 48.50 - 13 49,278 20,100.00 3.35 -1.18 85 3,028,150 UNITED CAPITAL PLC 361 20,322,115 1,347 171,981,341 HEALTHCARE PROVIDERS EKOCORP PLC. 1,680.29 3.37 - 1 2 1,101.47 0.31 6.90 6 1,465,212 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 7 1,465,214 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 544.04 0.55 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 7,425.00 4.95 - 8 27,015 FIDSON HEALTHCARE PLC GLAXO SMITHKLINE CONSUMER NIG. PLC. 14,111.34 11.80 -1.67 25 153,000 MAY & BAKER NIGERIA PLC. 4,140.56 2.40 - 6 50,502 1,158.49 0.61 - 2 43,800 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 325.23 1.50 - 0 0 PHARMA-DEKO PLC. 41 274,317 48 1,739,531 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 710.40 0.20 - 2 4 2 4 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 1 2 NCR (NIGERIA) PLC. 648.00 6.00 - 2 52 TRIPPLE GEE AND COMPANY PLC. 381.11 0.77 - 0 0 3 54 PROCESSING SYSTEMS CHAMS PLC 939.21 0.20 - 4 498,004 12,306.00 2.93 - 2 502 E-TRANZACT INTERNATIONAL PLC 6 498,506 11 498,564 BUILDING MATERIALS BERGER PAINTS PLC 2,391.04 8.25 - 1 2 CAP PLC 23,800.00 34.00 - 5 2,521 CEMENT CO. OF NORTH.NIG. PLC 262,870.02 20.00 -0.25 32 437,855 612.00 0.29 - 3 5,152 FIRST ALUMINIUM NIGERIA PLC MEYER PLC. 286.87 0.54 - 1 2 1,999.41 2.52 - 1 2 PORTLAND PAINTS & PRODUCTS NIGERIA PLC PREMIER PAINTS PLC. 1,279.20 10.40 - 1 2 44 445,536 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 3,610.71 2.05 9.63 12 198,500 CUTIX PLC. 12 198,500 PACKAGING/CONTAINERS BETA GLASS PLC. 39,497.79 79.00 - 1 2 GREIF NIGERIA PLC 388.02 9.10 - 0 0 1 2 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 57 644,038 CHEMICALS B.O.C. GASES PLC. 1,577.57 3.79 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,803.64 8.20 - 2 302 2 302 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 1 2 1 2 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 50.60 0.23 - 0 0 0 0 3 304 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,565.68 0.25 -7.41 56 7,628,589 56 7,628,589 INTEGRATED OIL AND GAS SERVICES OANDO PLC 90,127.74 7.25 9.85 180 7,852,712 180 7,852,712 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 64,907.15 180.00 - 11 10,328 CONOIL PLC 15,960.90 23.00 - 20 29,175 ETERNA PLC. 6,194.69 4.75 -1.04 18 152,353 FORTE OIL PLC. 36,469.47 28.00 - 24 55,012 MRS OIL NIGERIA PLC. 6,354.80 20.85 - 5 4,252 TOTAL NIGERIA PLC. 64,509.15 190.00 - 11 13,438 89 264,558 325 15,745,859 ADVERTISING AFROMEDIA PLC 2,219.52 0.50 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 16,576.10 1.70 - 1 2 1 2 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 411.72 0.35 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 3,242.23 5.50 - 5 5,555 TRANS-NATIONWIDE EXPRESS PLC. 304.75 0.65 - 2 4 7 5,559 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 2 5,002 2 5,002 HOTELS/LODGING CAPITAL HOTEL PLC 4,801.22 3.10 - 3 62 IKEJA HOTEL PLC 4,427.84 2.13 - 7 132,202 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 46,362.46 6.10 - 6 2,993 16 135,257 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,800.00 0.40 - 2 4,202 2 4,202 PRINTING/PUBLISHING ACADEMY PRESS PLC. 241.92 0.40 - 1 2 LEARN AFRICA PLC 1,157.18 1.50 - 5 84,749 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 992.24 2.30 -2.13 2 100,002 8 184,753 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 895.16 0.54 -5.26 23 5,278,295 23 5,278,295 SPECIALTY INTERLINKED TECHNOLOGIES PLC 766.91 3.24 - 1 2 SECURE ELECTRONIC TECHNOLOGY PLC 1,126.31 0.20 - 1 2

Wednesday 27 February 2019

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Wednesday 27 February 2019

Live @ The Exchanges Top Gainers/Losers as at Tuesday 26 February 2019 GAINERS

LOSERS

Company

Opening

Closing

Change

GUINNESS

N65.1

N67.15

2.05

N11.05

N12.05

N6.6

N7.25

0.65

DANGFLOUR OANDO

Market Statistics as at Tuesday 26 February 2019

Opening

Closing

Change

NESTLE

Company

N1580

N1510

-70

UBN

N7.25

N6.65

-0.6

FBNH

N8.3

-0.3

AIRSERVICE

N6.45

N7.05

0.6

ZENITHBANK

N26

N25.8

-0.2

AFRIPRUD

N4.4

N4.84

0.44

GLAXOSMITH

N12

N11.8

-0.2

ASI (Points)

32,473.82

DEALS (Numbers)

4,066.00

VOLUME (Numbers)

322,180,542.00

VALUE (N billion)

2.4349

MARKET CAP (N Trn

12.109

Market loses over N80bn as investors take profit in value stocks Stories by Iheanyi Nwachukwu

i g e r i a n stock market lost about N84.4billion at the sound of the Bourse closing gong on Tuesday February 26, 2019 as investors moved to take profit in stocks like Nestle Nigeria Plc, Union Bank of Nigeria Plc, FBN Holdings Plc, Zenith Bank Plc, and GlaxoSmithKline Consumer Nigeria Plc. The stock market closed with 21 gainers as against 20 losers. The Nigerian Stock Exchange (NSE) All Share Index (ASI) decreased by 0.69percent, while the Year-to-Date (Ytd) return still stood positive at 3.32percent. This negative comes on the heels of the market awaiting the announcement of the results of the recently concluded presidential and national assembly elections. Vetiva research analysts had expected that stock trading will main-

tain a positive tilt in Tuesday’s session, noting that the anticipation of final election results and outcome continue to drive some cautious sentiment”. The All Share Index closed at 32,473.82 points against the preceding day close of 32,700.12 points while Market Capitalisation closed at N12.110 trillion as against preceding day close of N12.194 trillion. The volume of stocks traded increased by 46.57percent, from 219.8

million to 322.1million, while the total value of stocks traded decreased by 56.14percent, from N5.55billion to N2.43 billion in 4,066 deals. Sunu Assurance Plc, Access Bank Plc, Diamond Bank Plc, UBA Plc and GTBank Plc were actively traded stocks. Nestle Nigeria Plc recorded the highest loss after its share price declined from N1580 to N1510, losing N70 or 4.43percent. The value of Union Bank of Nigeria Plc stock price

was also down by 60kobo, from N7.25 to N6.65, losing 8.28percent. FBN Holdings Plc declined from N8.3 to N8, losing 30kobo or 3.61percent. Zenith Bank Plc share price lost 20kobo or 0.77percent, from N26 to N25.8; while that of GlaxoSmithKline Consumer Nigeria Plc declined from N12 to N11.8, losing 20kobo or 1.67percent. On the gainers table, Guinness Nigeria Plc occupied topmost position after its share price advanced by N2.05, from N65.1 to N67.15, adding 3.15percent. Dangote Flourmills Nigeria Plc followed after rising from N11.05 to N12.05, up by N1 or 9.05percent. Oando Plc rallied from N6.6 to N7.25, up 65kobo or 9.85percent. Seplat Petroleum Development Company Plc, a leading Nigerian indigenous oil and gas company listed on both the Nigerian Stock Exchange and London Stock Exchange, on Tuesday said it will issue its Full Year 2018 Financial Results on Wednesday March 6, 2019.

CSCS gets ISO/IEC 27001:2013 recertification …following recent audit of its compliance with information security risks controls

entral Securities Clearing System (CSCS) Plc has received its recertification under ISO/ IEC 27001:2013. This follows the recent audit of its compliance with information security risks controls by the British Standards Institution (BSI), UK, one of the world’s largest accreditation bodies for ISO certifications. The audit involved a series of process validation and assurance check of controls with respect to company and client data management. The ISO/ IEC 27001:2013 certification was first obtained by CSCS in 2015. It is conducted by BSI every three years and in between, a

yearly surveillance audit is done. The next recertification audit comes up in 2022. CSCS which operates a computerised system for transactions in securities facilitates the delivery and settlement of securities transactions consummated on approved Nigerian Exchanges. It enables securities to be processed in electronic book-entry form, speeding up the transaction period. It also provides ancillary services such as the Electronic Document Management Services, collateral management amongst others. Whilst receiving the recertification report, Haruna Jalo-Waziri, Managing Director/Chief Executive

Officer of CSCS Plc said that as a significant Capital Market Infrastructure and indeed, the Central Securities Depository for the Nigerian Capital Market, one of CSCS’ paramount areas of focus is protection of commercially sensitive information belonging to the company and its investors. According to Jalo-Waziri, “CSCS is committed to upholding the highest standards of security for the processes, people and technology powering our services. The confidentiality, integrity and availability of information under our custody is held sacrosanct. ISO recertification provides assurance to all our customers that we

have controls in place to identify and mitigate potential risks to confidential information. We work hard to ensure that we build trust and credibility in the market so as to inspire confidence among our stakeholders”. Jalo-Waziri added that the “recertification serves to test and affirm our commitment to information security at all levels of our business and I am pleased to begin the year with this milestone”. The Managing Director expressed his profound appreciation to both internal and external stakeholders for their commitment and steadfastness in ensuring the success of the recertification audit.

NBCC hosts stakeholders at Breakfast Meeting on positioning for BREXIT

n lieu of the British government’s exit from the European Union, The Nigerian-British Chamber of Commerce engaged stakeholders and member partners of the commission to its quarterly advocacy group breakfast session to discuss the impact and opportunities for key stakeholders within the Nigerian and British business communities in relations to trade with the United Kingdom in the coming months. The meeting which was organized by the commission aimed at enlightening stakeholders on preemptive steps to be taken in positioning their businesses and taking the lead with great advantages the BREXIT has to offer. It also availed member partners and businesses networking opportunities as it was well attended by dignitaries such as the Deputy High Commissioner Laure Beaufils, Country Head, Common Wealth Enterprise Investment Council (CWEIC), Obinna Anyanwu, and Ambassador Chinedu Osakwe amongst others. Delivering the keynote speech, the British Deputy High Commissioner to Nigeria, Laure Beaufils stated that one major opportunities the Brexit presents to stakeholders is that, it avails the British government the independence to put in place its own trade policies as a country, alongside other countries which includes Nigeria and other business communities with affiliation with Britain. She also stated, that the increased trade relations and engagement will be beneficial for investors and trading markets as the relationships will not just be limited to commercial

affairs, but through British establishments and commitments, issues relating to climate change, environment, improved investments for job creation, trade & investments will be addressed as British companies are already looking to add value to the partnerships and increasing investment opportunities within Africa. Muda Yusuf, Director General, Lagos Chamber of Commerce and Industry who made a presentation on the theme, “Positioning for Brexit” noted that there are a lot of opportunities for trade between Nigeria and the UK only if the two countries create the enabling environment. Muda stated that with Brexit, trade deals will be quicker to access from both countries as it is better and easier to deal with one country as opposed to an economic block which has been in place for years. He further stated that, trade relations between Nigeria and the UK could be better improved when businesses create a supply and demand chain in terms of strong purchasing power and create an enabling environment for investments to thrive as the dependence on oil and gas, as well as agricultural produce might not be sustainable on the long term as he urged regulators within the Nigerian and British communities to consider putting in place policies such as easy access to finance for local exports, visa waivers for investors, investing in trade shows and trade fairs which could impact positively on the growth of local markets, bi lateral trade relationships and improved investment opportunities.

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BUSINESS DAY

34 BUSINESS DAY NEWS Buhari closes in on Nigeria victory... Continued from page 1 former vice president, who has

struggled to shake off a reputation for being a kleptocrat, has fallen well behind Buhari. Buhari has the North to thank for his big lead over Atiku, whose chances of putting up a fight against Buhari were hurt by low voter turnout in the South-East and SouthWest, particularly Lagos and Enugu. Atiku’s party, the People’s Democratic Party (PDP), has rejected the result, after claiming irregularities in the voting numbers. They question the high voter turnout in Boko Haram-ravaged Northern states like Yobe. In Yobe, Buhari clinched 497,914 votes, 91 percent of the votes, while Atiku settled for 50,763 votes, 9 percent of the total.

In 2015, President Buhari claimed 53.96 percent of the votes (15.4 million) to beat then incumbent Goodluck Jonathan, who had 44.96 percent (12.85 million). To win, a presidential candidate must attain both the highest number of votes cast and at least a quarter of the votes at each of at least twothirds of the 36 states and the Federal Capital Territory (FCT), according to Article 134 (2) of the Nigerian Constitution. If no candidate satisfies the requirement, a second election will be held between the two leading candidates within seven days from the pronouncement of the result. As it stands, both candidates have secured 25 percent of votes in twothirds of the states. “From the preliminary results, Buhari looks set to win this election,” said Kyari Bukar, former chairman

C002D5556

of private sector think-tank, the Nigerian Economic Summit Group. “That is not exactly good news for the economy as another four-year term for him (Buhari) heightens the risk of slower growth and a lull in proprivate capital reforms,” Bukar said. Mark Bohlund, an economist at Bloomberg Economics, said a victory for Buhari could mean more political interference in the economy. “The opening of the Egina offshore oilfield this month and the Dangote refinery next year will deliver a near-term boost, but low capital investment is likely to inhibit growth over the medium term,” Bohlund said in a February 26 note. Nigeria’s 2019 presidential election is the biggest-ever democratic exercise in Africa, with some 73 million people eligible to vote. However, the exercise was marred by cases of sporadic violence and voter suppression. Dozens were victim to yet another

L-R: Muda Yusuf, director-general, Lagos Chamber of Commerce and Industry (LCCI); Babatunde Ruwase, president; Layo Okeowo, chairman, Printing, Publishing and Allied (PPA) Group, LCCI, and Biodun Okeowo, chairman, FAE Limited, at the inauguration of the LCCI Printing, Publishing and Allied (PPA) Group in Lagos, yesterday. Pic by Olawale Amoo

APC, PDP take battle to National Collation... Continued from page 1

Collation Agent, at the Collation

Centre on Tuesday demanded that INEC should project the result of accreditation as it earlier promised, particularly in northern states such as Bauchi, Yobe and Borno, where it appeared the smart card reader was not used for accreditation, against the guidelines and regulations for the 2019 general elections. But Festus Keyamo, the APC National Collation Agent, raised an objection to the demand of the PDP. Citing relevant laws that empower the INEC chairman to determine proceedings during collation, Keyamo stressed that APC was seriously embittered by results from the states in the southern part of the country where, he alleged, elections were massively rigged. He said the party was waiting to follow the right channel. Also at a press conference on Tuesday night, Taminu Turaki, a former minister of special duties and deputy director general, PDP Presidential Campaign Council, called on INEC to immediately stop the ongoing collation of election results for the 2019 Presidential election. Rejecting the results declared in Yobe, Zamfara and Borno States, Turaki called on the electoral umpire to provide the results from the smart card readers from the polling units. Peter Obi, vice presidential candidate of PDP, also said INEC achieved its plan to disenfranchise the entire South East in the presidential elec-

tion. Obi told newsmen in Onitsha on Tuesday that the presidential election result in Anambra State as announced by INEC was not the true reflection of votes, alleging the same thing happened in the South-East geo-political zone. He said many electorates in Anambra, as well as in other states in the South-East, could not vote because the card readers did not function effectively. “We are now seeing results coming from Bauchi, Yobe, Borno that seem like we are in two countries. While in the people in the South had issues voting and card reader complaints, we seem to have quiet and peaceful elections in places where people had complained of severe cases of insecurities and harassment by the military and bandits,” Chidoka said at the National Collation Centre. Chidoka said while it was not yet signed in electoral law, there were guidelines and it was clear that no voting should take place where there are no card readers. Chidoka said he has a letter to that effect to Mahmood Yakubu, INEC chairman, written by Uche Secondus, PDP national chairman, but was instructed by the INEC boss to submit the letter to the Commission’s headquarters at Maitama and not at the International Conference Centre, venue of the collation. In his response, Keyamo said according to clause 32-35 of INEC regulation, the power of the INEC chairman sitting at the collation

centre did not involve the type of inquisition that PDP was asking for. He said the details the PDP spokesman was asking for amounted to an inquisition into the results submitted to INEC. “There is a proper avenue to seek for such inquisition into how many people were captured by the card readers and all of that and compared to the result,” Keyamo said. “We have our own complaints about a lot of open rigging and thumb-printing we saw in Cross Rivers North. Some people were just paraded in Rivers States that were with INEC materials. So we have all these complaints but we have kept our peace here since because we know the right procedure to take to submit and challenge those figures coming from that part of the south also,” he said. Recall that three months ago, President Buhari withheld assent to the Electoral Act (amendment) Bill 2018 after keeping the nation guessing. It was the fourth time he did so in a row, having thrice turned down the bill before the December 6 final blow. The card reader, believed to be the real reason the bill was rejected, was included in the bill as the sole means of accreditation of voters. The new provision made it so tight that where a card reader fails, voting in the affected centre will be put on hold for 24 hours for the problem to be fixed. This was to prevent the manipulation of the accreditation process in any way by resorting to manual methods at the slightest opportunity.

round of decade-old bombings by Islamic militants up north in Maiduguri, capital of Bornu State, while brutal killings reigned down south in the oil-rich Rivers State. People were killed and in milder cases battered and injured, while election materials were set ablaze by armed bandits and voting delayed for hours in some polling centres mainly in southern Nigeria. Situation Room, a coalition of more than 70 civic groups monitoring the election process, said it observed violent disruptions by political thugs that snatched and burnt ballot boxes and papers. The group reported that 16 people were killed in electoral violence across eight states. The chairman of Atiku’s PDP, Uche Secondus, accused the gov-

Wednesday 27 February 2019

ernment of using “inducements, manipulation and incarcerations” and enlisting the police and national army “to silence the voices of our long-suffering people”. In a statement, he challenged results in Borno, Nasarawa, Yobe and Zamfara States and said they should be cancelled and fresh elections done. He also contested the number announced. Buhari’s All Progressives Congress (APC) rejected the claims in the statement by PDP, accusing the party of trying to “discredit and destabilise” the electoral process. Atiku and Buhari present two different ideologies. While Atiku is seen to be pro-market and capitalist, Buhari emphasises state-led economic policies.

Concerns on economy heighten as result... Continued from page 2

Agriculture (NACCIMA). Ejinkonye, who is also business development director, Africa Esilknet, said a lot of businesses, both local and foreign, have their hands on the pause button for now. “This, of course, has slowed down economic activities with the attendant cost and negative effect on our GDP,” he said. At the National Assembly, the lawmakers who travelled to their states for last Saturday’s election are yet to return, even with strong indications that they may stay back for the governorship and State Assembly elections billed for March 9. Also, security agents who used to have a hectic time controlling staff and visitors to the National Assembly Complex were seen in groups discussing the election results, as few people turned up at the complex. On Tuesday, lack of quorum forced the Senate to adjourn for two weeks, as only eight out of the 109 senators were in the hallowed chamber for plenary. Senate Majority Leader Ahmad Lawan, who moved the motion for adjournment, explained that most lawmakers are currently in their constituencies because of the National Assembly elections yet to be concluded in many constituencies. According to him, most lawmakers are yet to know their fate, even as others are candidates in the forthcoming governorship election. BusinessDay reports that while about 60 senators sought re-election in last Saturday’s National Assembly election, nine others will contest the forthcoming gubernatorial election, while the remaining 40 failed to secure automatic ticket to contest.

“Our members who contested are yet to get their results finally, formally and officially declared and therefore theyneededtostayback.Andothersare also in the field to ensure very smooth election process across the country,” LawansaidatthebriefsessionofSenate plenary on Tuesday presided over by Senate President Bukola Saraki. Meanwhile, legislative aides and staff of the National Assembly did not show up for work on Tuesday. This comes as the Federal Secretariat Abuja, which houses the Federal Civil Service Secretariat, remains a shadow of itself, as most civil servants were not at their duty post as at Tuesday. Civil society organisations blamed the lull in business activities and other social engagements on the protracted elections process in the country. Jude Ohanele, executive director, Development Dynamics, told BusinessDay that it was a result of “the consequences of an analogue election process”. “What we have now is by-law, which is most unfortunate and of course with the level or politicking and bickering and the low mindedness of our politicians, you can see the escalation of violence,” Ojanele said. “From the beginning of campaigns to last Saturday, we are able to document 260 deaths across the country and on election day alone, we had 26 deaths. So, it tells you that we are dealing with a very reckless society that we need to upgrade,” he said. Livingston Wechie, executive director, The Integrity Friends for Truth and Peace Initiative (TIFPI), was, however, of the opinion that despite the difficulties, the idea is that no sacrifice made for democratic purposes is a waste.

Surprise, shock trail outcome of Presidential... Continued from page 2

Another great wonder of the 2019 presidential election is the victory of Atiku Abubakar in Edo State. Edo State is controlled by the APC, governed by Godwin Obaseki. The national chairman of the APC, Adams Oshiomhole, also hails from the state. Until the results began to pour in, not many Nigerians imagined that people would come out to vote in the insurgent-ravaged state of Borno. It was surprising to see huge figures up to 1 million as those who voted last Saturday in Borno. The same goes for Yobe, another north-east state where the activities of the Islamist sect, Boko Haram, have sent many indigenes packing from their ancestral homes. The figures from such states, according to observers, evoke “goose pimples”. The paltry figure declared for Lagos State as the total votes cast

from the humongous 5,531,385 declared as total number of permanent voter cards (PVCs) collected was also shocking. APC scored 580,814 against PDP’s 448,016. In Ondo State, the result of the presidential election released by INECsaw the PDP winning 11 out of the 18 local government areas in the state. The APC in Ondo State has been engulfed in internal crisis in recent times. The disagreement which erupted after the party primaries in the state last year led to divisions within the party, resulting in factions in the state chapter. Since the acrimonious primaries, Governor Rotimi Akeredolu has been in “cold war” with Bola Tinubu, the national leader of the party, and Oshiomhole, national chairman, after his preferred candidates were left in the cold in the selection process.

•Continues online at www.businessday.ng

Wednesday 27 February 2019

Esther Jemine Rewane passes on

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Pregnant, nursing women can now receive Ebola vaccine - WHO CALEB OJEWALE

he Rewane and Awani families of Warri announce the peaceful transition to the saints of their wife, daughter and mother, Mrs. Esther Jemine Rewane at the ripe age of 97 on February 20, 2019. Mrs. Rewane was the wife of Chief Ogbemi Newe Rewane, the Late Ologbosere of Warri. The daughter of Mr. Obuku Eguojaghan Afini Awani, a retired Civil Servant in the Inland Waterways Department of the Federal Ministry of Transport. An alumnus of Queens College in Lagos and Saint Monica College in Onitsha, she was fluent in Yoruba, Igbo, Urhobo and Itsekiri. She was an entrepreneur running a medium scale business in the Warri metropolis over the decades. She is survived by children, many grand and great grandchildren, brothers, sisters, cousins, nephews and nieces. Among whom are Professor Grace Alele Williams, former Vice Chancellor, University of Benin, Victor Awani, retired General Manager of AGIP Nigeria Plc in Port Harcourt, Evelyn Rewane-Fabyan, a retired member of the general management of Nexim Bank and Joint Matriculation Board (JAMB), Rosaline Rewane-Dafinone, who retired from the NNPC and Bismarck Rewane, an economist, Justin Rewane, a director of the Nigerian Institute of International Affairs, Carolyn Rewane, a senior Vice President at Wells Fargo Bank in Maryland, USA, and Toyin Damola Akinrolabu, a Judge in the State of New York in the US.

he Strategic Advisory Group of Experts (SAGE) on Immunisation set up by the World Health Organisation (WHO) has announced that pregnant and nursing women can now be given Ebola vaccine, a major step in combating the epidemic, which has been a public health concern for some years now. Last August, the Democratic Republic of the Congo’s (DRC) Ministry of Health declared a fresh outbreak of Ebola virus disease (EVD) in North Kivu Province. Noting that these experimental vaccines are “nonreplicating or replication deficient,” SAGE concluded, “Pregnant and lactating women should be included into the clinical trial protocol. “The protocol must include provisions for safety monitoring and for documentation of EVD cases among vaccines, including follow-up of pregnant women and their offspring,” the Group stressed. According to SAGE, national authorities should choose the vaccine “based on a transparent and evidence-based process.” Meanwhile, WHO, the Health Ministry and partners continue working to establish the outbreak’s full extent. As of February 16, 2019, 773 confirmed EVD cases have been reported in one of the country’s most populated provinces – with eight million inhabitants – as well as 65 probable others and 534 deaths.

L-R: Olukayode Pitan, managing director, Bank of Industry (BoI); Aliyu AbdulRahman Dikko, chairman; Nike Akande, former minister of industy; Waheed Olagunju, retired executive director, BoI, with his wife Bolaji, during the send-forth dinner in honour of Olagunju as he retired as executive director of BoI in Lagos, yesterday.

Nigeria’s claim against Eni, Shell could be largest-ever payment in sector corrupt case OLUSOLA BELLO with agency report

he Nigerian government’s decision to formally launch a $1.1 billion claim against Shell and Eni in UK courts, relating to funds allegedly misappropriated for bribes and kickbacks during the acquisition of an oil bloc in 2011, could lead to the largest-ever payment in an oil sector corruption case. If successful, the case, launched in November 2018, could also open the door for more scrutiny by governments of deals made by their predecessors in the hope of winning similar awards. The two firms have received harsh criticism from an Italian judge and now await UK court proceedings According to the Economist, Eni and Shell deny any wrongdoing related to the deal. The legal case centres on the acquisition in

2011 of offshore bloc OPL 245-which could hold up to nine billion barrels of oil. Most of the $1.3 billion believed to have been paid. Lawyers for the Nigerian government said they had filed a $1.1 billion lawsuit against Royal Dutch Shell and Eni in a commercial court in London in relation to a 2011 oilfield deal. The OPL 245 oilfield is also at the heart of an ongoing corruption trial in Milan in which former and current Shell and Eni officials are on the bench. “It is alleged that purchase monies purportedly paid to the Federal Republic of Nigeria were in fact immediately paid through to a company controlled by Dan Etete, formerly the Nigerian minister of petroleum, and used for, amongst other things, bribes and kickbacks,” the statement said. The two oil majors are embroiled in a long-running corruption case revolving

Shipping lines introduce surcharge on Nigeria, W/African-bound cargoes AMAKA ANAGOR-EWUZIE

wo shipping lines operating in Nigeria have introduced a new surcharge called ‘Peak Season Surcharge’ (PSS) on all cargoes originating from anywhere in the world to Tin-Can, Apapa ports in Lagos and Onne Port in Rivers State. The surcharge, announced by both HapagLloyd and CMA CGM via electronic mails last week, has automatically increased the freight rate payable by any Nigerian importer bringing his or her consignment using the above mentioned shipping lines. Hapag-Lloyd, a Germanbased firm, the fifth largest shipping company in the world, in a memo seen by BusinessDay, stated that 20-

foot and 40-foot containers from China, Taiwan, Hong Kong, and Macau would pay $700 PSS each. It also said containers from the US and US territories would pay $700 each from March 15, and those coming from the rest of the world like Europe would pay €610 on the consignment. According to the company, the review will enable it maintain a continued high level of service. The growing demand leads to lack of space on vessels and increasing costs for supplying sufficient equipment. Carriers can implement this surcharge any time and at any level until further notice. It said in practice, PSS functions like the General Rate Increase (GRI). It is usually announced as an

additional fee on top of the base rate, although it may be cancelled or mitigated at a lower rate. Hapag-Lloyd said the PSS would become effective from March 1, 2019, until further notice for all origins (excluding USA). It added that consignments from the US would also pay PSS from March 15, 2019, until further notice. Meanwhile, the leading shipping firm, Maersk also introduced PSS taking effect from February 15. “Maersk is introducing the PSS for all cargo from Pakistan to West Africa countries (excluding Tin-Can Island Port, Apapa, and Onne) with effective from 15th February 2019.” Recall that Hapag-Lloyd had in November last year introduced PSS for all container types to Nigeria at the

rate of $505 and $450 each. It has a fleet of 222 modern container ships and a total transport capacity of 1.6 million TEUs (Twenty Foot Equivalent Unit). Also, CMA CGM stated in a memo dated February 22, 2019, that its new surcharge applies to cargoes destined for Tin-Can, Apapa and Onne ports. According to the shipping line, effective March 7, 2019, the new rates of a uniform PSS of $750 will be imposed on all categories of consignments including dry, break bulk and reefer cargoes. It stated that cargoes originating from China, South Korea, Taiwan, Japan, Southeast Asia and Bangladesh including Middle East Gulf as well as North and South America would be affected.

around the purchase of Oil Prospecting Licence 245. OPL 245, which is one of the biggest sources of untapped oil reserves on the African continent with reserves estimated at nine billion barrels, is also at the heart of an ongoing corruption trial in Milan, Italy, in which former and current Shell and Eni officials are on the bench. Milan prosecutors alleged bribes totalling around $1.1bn were paid to win the licence to explore the field, which, because of disputes, had never entered into production. The new London case also related to payments made by the companies to get the OPL 245 oilfield licence in 2011. “It is alleged that purchase monies purportedly paid to the Federal Republic of Nigeria were in fact immediately paid through a company controlled by Dan Etete, formerly the Nigerian Minister of Petroleum, and used for, among other things, bribes and kickbacks”.

CHANGE OF NAME

I, formerly known and addressed as Miss Oluwakemi Omowude now wish to be known and addressed as Mrs. Oluwakemi Akinwande. All former documents remain valid. General Public please take note.

CHANGE OF NAME

I, formerly known and addressed as Abiala Kehinde Alimat now wish to be known and addressed as Abiala kehinde Shadiat. All former documents remain valid. General Public please take note.

CHANGE OF NAME

I, formerly known and addressed as Miss Odang Eunice Ajeh now wish to be known and addressed as Mrs. Gbejewoh Eunice Ajeh. All former documents remain valid. General Public please take note.

“Accordingly, it is alleged that Shell and Eni engaged in bribery and unlawful conspiracy to harm the Federal Republic of Nigeria and that they dishonestly assisted corrupt Nigerian government officials.” The Nigerian government also included Nigeriabased Malabu Oil and Gas in the lawsuit, and a company called Energy Venture Partners Ltd., according to Bloomberg. Malabu was allegedly controlled by Etete, who took possession of the $1.1 billion payment and used it for bribes and kickbacks, according to the lawsuit. Antonio Secci, a lawyer for Etete, was quoted as saying that the London suit “surprises” because the Nigerian government is already seeking damages in Milan.

CORRECTION OF NAME

This is to inform the general public that my name was wrongly written as Adeyemo Francis Ponnle instead of my correct name which is Adeyemo Francisca Adebola. All banks and genral public please take note.

CHANGE OF NAME

I, formerly known and addressed as Olaniyan Sakirat Aderayo now wish to be known and addressed as Abdullah Sakirat Olaniyan. All former documents remain valid. General Public please take note.

CHANGE OF NAME

I, formerly known and addressed as Udoh Mfon Grace now wish to be known and addressed as Ayonote Grace Mfom. All former documents remain valid. General Public please take note.

CHANGE OF NAME

I, formerly known and addressed as Miss Abioye Ramat Toyin now wish to be known and addressed as Mrs Akindele Ramat Toyin. All former documents remain valid. General Public please take note.

BUSINESS DAY

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Banks improving soundness to continue into 2019 Stories by Hope Moses-Ashike

n response to the various measures by the Central Bank of Nigeria (CBN) to enhance financial system stability, banking sector key prudential ratios generally improved as of December 2018, though asset quality remains challenged. Banks’ capital adequacy ratio (CAR) stood at 15.26 percent in December 2018 from 12.08 percent at the end of June 2018, data from CBN indicated. The industry threshold, however, remains at 15.0 per cent for banks with international authorisation and 10.0 per cent for banks with either national or regional authorisation. Liquidity ratio of Nigerian banks currently stands at 51.87 percent, an improvement from 46.09 per cent recorded at the end of the first half of 2018. This remains above the prudential thresh-

old of 30 percent. Asset quality, measured by the non-performing loans (NPL) ratio also improved to 11.68 percent as against 12.45 percent in the first half of 2018. The Apex bank had directed banks to intensify efforts at debt recovery, realisation of collateral for lost facilities and strengthening their risk management processes. “This moderation in NPLs, if sustained, would encourage banks to increase lending to the economy, which has remained challenging during the year”, Sanusi, Aliyu Rafindadi, member of the Monetary Policy Committee (MPC) said in his personal statement at the last meeting. At about 2.0 percent, private sector credit (PSC) growth was significantly below the target of 12.4 percent. Godwin Emefiele, governor of the Central Bank of Nigeria (CBN) note the unsatisfactory pace of PSC

Source: NBS

and continue to emphasise the importance of enhanced credit flows to strategic private sector ventures through an effective collaboration of all stakeholders. “I remain aware of the risk aversion of banks to supposedly high risk real sector ventures”, Emefiele said in his personal statement. “Yet, improvements in banks NPL position and our continuing efforts at de-risking the target activities are steps in the right direction.

“We expect that this could begin to bolster domestic investment, household demand, and aggregate productivity, while accelerating economic diversification, and ensuring strong and inclusive growth”. Members of the MPC noted in their personal statements that the financial sector has been stable and resilient during the year. The total assets of the banking industry have increased by N2.67 trillion representing

Fidelity Bank gives out N68m to customers, advises on investment

s part of its commitment towards financial literacy, Fidelity Bank plc last week advised customers who have benefited in its savings reward scheme to think of investing some portion of their money rather than squander everything. This is coming as the bank has given out N68 million cash prizes and 72 consolation to 123 customers across the country, in it Get Alert In Millions season three promo. At the end of its 4th monthly and 2nd bi-monthly draw held in Lagos, 12 customers won N18 million cash prizes in various categories of the draw. Also, 18 consolation prizes ranging from television sets, generator sets and refrigerators were won by 18 customers. Customers who emerged winners of N1 million (monthly draw) include Man

of Order and Disciples movement of Nigeria (Lagos); Ogedegbe Frank (North), Josphine Ilori and Odozi Gloria (South-South); Chidinma Nnatuanya and Digidi Dunhill (South East), Ibom Amaka (Abuja) and Obuh Peter (South West). In the bi-monthly draw, Charles Okafor (Abuja) and Oghenewajuiome Ezo (South West) won N3 million each. “We will like to note that at the end of this draw we

would have given out a total of N68 million cash prizes and 72 consolation prizes of refrigerators, television sets and generators sets to over 123 winners”, Chijioke Ugochukwu, executive director shared services and products, said. She noted that the bank had also given out airtime worth over N3.5 million to 2,500 customers in addition at the last prize presentation which was held at Trinity,

Olodi Apapa. We also give away on that day the prize to the GAIM season 3 jingle contest winner. We expect more winners to emerge because we still have N42 million to give away and several consolation prizes yet to be won”, Ugochukwu added.Speaking with journalists after the draw, Richard Madiebo, divisional head of retail banking, “we are here to reward our savings customers and also develop the savings culture in Nigeria through our savings promos and we have done that with a measure of success.”On financial inclusion, Madiebo said, “financial inclusion is about getting people into the financial net. Fidelity has a lot of programmes around lending, some of which you will start to see in the next few weeks on our digital lending platforms”.

an increase of 6.55 per cent between December 2017 and December 2018. In his personal statement at the last Monetary Policy Committee (MPC), Folashodun Shonubi, deputy governor of the Central Bank said while performance of the banking sector generally showed gradual and consistent improvement in the health and soundness of the institutions, mainly, due to timely regulatory actions,

decisive resolution of outlier institutions will further strengthen the resilience of the industry. “The gradual improvement in the health of the banking system is expected to continue in 2019, as banks implement regulator prescribed corrective and preventive measures, as well as, benefit from the positive spillover from the favourable macroeconomic conditions”, said Shonubi. According to Joseph Nnanna, deputy governor said in his personal statement the financial system remained resilient, despite concerns about non-performing loans in the banking sector. Sustained regulatory oversight is reducing the NPLs, and the relative rebound in the oil sector, would further strengthen financial stability. Overall, credit to the core private sector has remained sticky upward, as government borrowing continued to gain momentum.

Empowering businesses with Ecobank Omni Lite

atrick Akinwuntan, managing director of Ecobank Nigeria, has reaffirmed that the bank’s recently upgraded online banking platform for businesses, Omni Lite, is versatile, secure and user friendly . He urged business owners to take advantage of the services available on the platform which has been specifically optimised for them. Those in the commercial sector such as small and medium enterprises (SMEs), faith based organisations, educational institutions, Non-government Organisation and government institutions etc. can manage their transactions effectively and access an array of tailor made solutions designed to empower their businesses. According to Akinwuntan, Omni Lite is primarily designed with business owners

in mind. It comes with features to enhance businesses such as efficient and seamless cash flow management, easy view of all accounts and expenses in one place , convenient salary payment with bulk payments upload, management of loan payments, exchange rates calculation and other interesting features. Further, Akinwuntan noted that with Omni Lite, customers have access to real time transaction details, domestic and interbank funds transfers and online loan requests. The platform comes with best in its class security tools to ensure that users are protected. He enjoined business owners to register for Ecobank Omni Lite and discover how the platform can help grow and manage their businesses.

Wednesday 27 February 2019

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Central Bank engagement with banking industry commendable - Akinwunmi As the tenure of Godwin Emefiele, governor of the Central Bank of Nigeria (CBN) expires in about three months, Ayodele Akinwunmi, head of research and strategy, FSDH Merchant Bank Limited, in this interview with Hope Moses-Ashike, looks at the economy and banking industry under his administration and concludes that he has performed well. Excerpts:

establish in Nigeria. A few weeks ago, we saw that he (Emefiele) was at the Dangote Refinery and he pledged the Central Bank’s support to ensure the completion of the project. So, for me, he has done well. He has been able to stabilise the exchange rate, even though we saw some depreciation a few years back, which was not caused by him. If we had not diversified the productive base of the economy to generate income and diverse forex, oil price volatility would remain a challenge. Inflation came down consistently in 2018. In the banking industry, look at the way they are resolving the problems some banks had. We saw how Polaris Bank took over Skye Bank and no job was lost. He has ensured that no depositor lost his or her deposits and provided stability to ensure that the institution remains sound until they find a buyer. And the kind of engagement the Central Bank has with the banking industry which it regulates is something that is commendable. They involve the banks in major decisions and when they want to implement a policy, they get the views of the banks about some of the policies. So, for me, Emefiele has done well and if he is coming back, he is going to do better and if he is not coming back, I believe whoever takes over from him would continue the good work. You anticipated an increase in treasury bills yield this year. What do you think will drive your projection? Yes, the political actors at the moment may give a lot of promises, but when they win the election, there are realities that they need to come down to. If you look at the 2019 proposed budget estimates that the federal government released late last year, it shows that revenue for this year is going to go down, compared with the 2018 numbers. Again, average oil price this year, from all forecast globally is going to go down. The outlook of the global economy this year is a bit fragile. The European Central Bank revised downward their outlook for this year; the World Bank earlier in the year revised downward their outlook for most regions. We are also seeing the United States- China trade disputes, even though they made some progress to resolve it. Of course, look at what is going on in Europe, where the Brexit deal is causing a lot of uncertainties in that market and nobody knows how it is going to turn out eventually and people cannot plan. In Italy, it is the same. Look at what is going on in Venezuela. So, there are lots of issues across the globe. In Nigeria, our growth forecast is about two per cent for this year, while our popula-

Ayodele Akinwunmi

tion growth rate is about three per cent. So, Nigeria should be growing at more than 2.5 per cent. So, those are the issues that may likely play out. So, there is the need for the federal government to borrow more because we have a lot of infrastructure problems in Nigeria and the federal government would need to borrow more. Yes, they are increasing the tax base to ensure that more people pay tax, but then, companies that are making profit are the ones that would pay tax. So, if the environment is harsh on them to make profit, it would reduce the amount of tax revenue for the government. So, what we have said is that they need to adjust electricity tariff be-

‘

So, if there is a problem from those economies, it would affect the global economy. So, the trade transaction has multiplier effect on the global economy

‘

In the next three months, the tenure of the current Governor of the Central Bank of Nigeria will come to an end and by then, it is expected that the presidency would have told us if it will be renewed or if a new CBN Governor will be appointed. If you are to assess the Central Bank under the leadership of Godwin Emefiele, how do you think he has performed in the last five years? he reality is that the Central Bank governor has done well. Look at the Investors and Exporters’ (I&E) structure for foreign exchange, in April 2017, when that policy was introduced, it changed the dynamics in the equities market and the stock market appreciated by 42 per cent in that year. Also, in 2015, when the current president was sworn in, remember that for almost six months, we didn’t have a cabinet. The economy then was managed solely by monetary policy and they ensured that the economy was stable. And it was because of the initiatives of the CBN Governor and his team, that made us not to feel the impact. It is like somebody driving with one leg or a human being walking with one leg. So, the CBN Governor helped in navigating the crisis and in stabilising the economy. In addition, look at the restriction of access to forex that was placed on 42 items. Some people may not appreciate that, but the reality of the matter is that if a country can only support its currency, not by foreign portfolio investments, but by the quantum of foreign earnings that you can generate. So, there were a number of things we were importing that we had the capacity to produce here. So, the forex restriction on the official and interbank market that was place on those items, made the companies abroad to come to Nigeria to start operations here. Rice production has increased substantially and I remember that the CBN Governor said then that a central bank in a developing country like Nigeria, must play development roles in various sectors. So, the CBN under his leadership has established a whole lot of funds to support some strategic sectors in the economy that have the capability to generate employment. As you are aware, one of the problems we have in Nigeria is high level of unemployment rate. If almost everything we consume in Nigeria are imported, what it then means is that you are exporting jobs and put pressure on the forex. But through the initiatives of the Central Bank under Emefiele, he has been able to introduce a lot of policies to ensure that some of those companies now see the need to come and

cause investments are not going to the sector because the tariff we have in the system is not cost reflective and when you invest there you are not able to make profit. Then if you don’t have good electricity to power your productive sector, investments would be leaving your country because the cost of running companies would be high and your products would not be competitive in the international market. So, we think the two things that they need to do quickly after the elections are: adjust the electricity tariff and pass-on the cost of petrol to the final consumers. This would increase inflation and the central bank would respond by increasing the yield on open market operations (OMO) and treasury bills to ensure that they retain foreign investments and also attract more. Those are the reasons why we think yields would likely increase after the elections. Your projections for 2019 are largely based on the assumptions that the elections will be successful. What is the projection if the election throws up a crisis? The only way I can answer the question is for all of us to assume that there won’t be crisis. Nigeria is such a big economy in Africa, such that if there is a crisis here, it is not only going to affect Nigeria and Nigerians, it is going to affect a West African countries and the entire of Africa. So, that is why the international community are coming together to discuss with the political actors, to ensure that there is peace. And I think we have every reason to believe that whoever wins, pro-

vided it is a free and fair election, as the Independent National Electoral Commission (INEC) has promised, then a winner that would truly reflects the will of the people of Nigerians would emerge. Otherwise, there would be chaos. Inflation in Venezuela today has risen by about 1.7 million per cent and nobody wants to imagine that happening in Nigeria. Remember that Venezuela and Nigeria have things in common – both of them are oil producing countries. Venezuela has the highest oil deposit in the world. So, if there is a problem in Nigeria, it would scatter a whole lot of things and the economy might slip back to recession. We recently exited recession and we all know what happened. We must also remember that there is a peace agreement that all them signed and so far, we have every reason to think the elections would be free and fair. The international observers are here and they would be working with the country to ensure that everything is peaceful. So, all the projections we are making are based on the assumption that there would be crisis-free elections. What would be the likely effects of Brexit on Nigeria? Now, if you look at the recent note that the Bank of England released after its Monetary Policy Committee meeting, they talked about a slowdown in the UK economy, basically on two factors and the first was the slowdown from abroad, not unconnected with the US- China trade tension. We now operate in a global economy that is interconnected. So, a problem in a particular part of the world and not just a small country – the US accounts for a quarter of the global GDP while China is also a big economy. In fact, the two economies account for over 30 per cent of global economy. So, if there is a problem from those economies, it would affect the global economy. So, the trade transaction has multiplier effect on the global economy. So, investors are not making long-term investment decisions because of the uncertainty surrounding the Brexit. Nigeria does business with the UK and if they are not able to supply what we need in our production process, it might affect production and may lead to inflation. Banks in Nigeria do businesses in Europe and if there are no capital flows, it would reduce the available investable capital in Nigeria and that means interest rate would go up. In January, we saw an increase in FPI through the I & E window and that money may be at risk going forward, with all the uncertainty. It may lead to the demand for oil in Nigeria and may weaken the naira.

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Wednesday 27 February 2019

Sanwo-Olu hinges Lagos’ strength on diversity

...urges continued peaceful co-existence Iniobong Iwok

he All Progressives Congress (APC) governorship candidate in Lagos State, Babajide SanwoOlu, has said the state is stronger socially and economically because of its diversity. Sanwo-Olu, who spoke against discriminatory comments fuelled by the disruption of elections in some areas of the state during the last weekend Presidential and National Assembly elections, cautioned Lagosians not to play into the hands of mischief makers and crisis merchants. He said the state is a home for all, adding that if elected, his government would serve every Lagosian regardless of ethnicity, religion or party affiliation. “Every resident of Lagos State is central to the promised socioeconomic development of the state, and everyone has the right to identify with any party of their choice. We are stronger and better in our diversity,” Sanwo-Olu said. “As a politician and a governorship candidate, it will be exciting for me to have the support of every

tribe in the state, but where people have other preferences, I cannot

he re-ele cte d s enator for Edo South district, Mathew Urhoghide has dedicated his victory to the people of the senatorial district and to the Benin Monarch. The Senate committee chairman on Public Account, who spoke with journalists in Benin-City, shortly after he was declared the winner of the election, noted that the election will renew his effort to reach to more communities than the last four years. Urhoghide, who promised to redouble his legislative duties in the National Assembly, noted that the overwhelming support of the electorate as well as the monarch’s royal blessings helped a great deal to galvanise popular support in his favour. He promised to fulfil all his electioneering promises including more opportunities for skills training and jobs for Edo youths

propriate for the electorate to support a party that has made Lagos a

L-R: Angela Freeman Miri, Niger State coalition officer for presidential election (SCOPE), with Mahmood Yakubu, chairman INEC/Returning Officer for Presidential Election, during the presentation of the Presidential election result at the National Coalition Centre in Abuja yesterday. Picture by TUNDE ADENIYI

Urhoghide dedicates victory to electorate, Benin monarch IDRIS UMAR MOMOH & CHURCHILL OKORO, Benin

say that they do not have such rights. However, it will only be ap-

and provision of additional social amenities in most rural communities in the senatorial district. “This victory is one that the Lord has made and we shall rejoice. It is victory for performance, quality representation and fulfilled promises for all my people in Oredo, Egor , Uhunmwode, Orhionmwon, Ovia and Ikpoba-Okha people. “Let me announce today that I am the Edo south Senator of the PDP. I am the Edo south Senator of the APC. I am the Senator of all residents of Edo south. “This is a new dawn for Edo South. This will be another four years of people focused representation as your Senator. I speak to you with my vision that this time around, there will be a renewed effort on my part to reach to more communities than I did before because that is their expectation and I will not fail them”, he said. Urhoghide was re-elected with 135,588 votes against Patrick Obahiagbon of APC who scored 121,957 votes.

home for everyone,” he said. Citing an instance of Lagos’ diversity, Sanwo-Olu said 40 percent of teaching staff in Lagos State public schools are non-Yorubas, while secondary schools students for whom the state government pays their National Examination Council and Senior Secondary School Examinations are in equal proportion between the Yorubas and non-Yorubas. “As a state, Lagos recognises her heterogeneity and will continue to promote the assorted ethnic composition as a unique advantage over other states in Nigeria. It is only in Lagos State that you can find principal officers who are not ethnic people in the state civil service, parastatals and establishments. I call on our people to eschew violence and any form of harassment of innocent people. We must live in peace for development we know in Lagos to continue,” he said. The APC candidate has anchored his campaign on ‘inclusive governance’, stressing that he would work to make positive impact in the lives and businesses of Lagosians.

Don’t stoke ethnic war in Lagos, Afenifere warns attackers of Ndigbo Chuka Uroko & Joshua Bassey

he pan-Yoruba socio-cultural organisation, Afenifere, has cautioned against possible ethnic war in Lagos, following alleged attacks on Igbo traders in Oshodi and Okota, some of whom had their shops vandalised by hoodlums. The organisation insisted that those involved in the unprovoked attacks and their sponsors must be immediately called to order. Yinka Odumakin, secretary of the organisation, who spoke with BusinessDay in Lagos on Tuesday, said the leadership of the All Progressives Congress (APC) in Lagos has a responsibility to ensure that no Nigerian, irrespective of tribe or religion, is made to suffer because of different political ideology or leaning, as the right of every citizen to hold his/her view is protected under the Constitution of Federal Republic of Nigeria. Hoodlums, suspected to be agents of political gladiators in Lagos, had on Saturday, February 23, 2019 invaded some polling units in Okota, OshodiIsolo Local Government Area of the state, chased away voters and officials

of Independent National Electoral Commission (INEC) and burnt the electoral materials. An eye-witness account says many people were injured in the fray. It was alleged that the hoodlums who regrouped and attacked some traders in the Okota areas on Monday, forcing them to close their shops, were querying the traders why they voted for another political party and not the ruling party in the state. The attack, it was further alleged, continued in Oshodi yesterday. Odumakin specifically asked the national leader of APC and former governor of Lagos State, Bola Ahmed Tinubu, to call those within his party to order. “What they’re doing is stoking ethnic violence. The Yorubas and Igbos have long lived together as brothers and sisters. Political leaders should not allow politics to bring about ethnic war and genocide in Lagos”, he advised. Afenifere had earlier condemned the Saturday’s violence in Okota and the attendant disruption of the Presidential/National Assembly elections suspected to have been caused by hoodlums allegedly working for the APC. The Okota area is predominantly

occupied by the Igbos. In last Saturday’s violence, ballot boxes with already thump-printed papers were hijacked and set ablaze. “Dirty political merchants and their band of thugs, apart from engineering political disenfranchisement of Ndigbo, went ahead to visit violence on them, burning their votes en masse. The political vandals they used were said to have been calling themselves OPC but our checks with the genuine leaders of the group have shown that the elements had no affiliation with the OPC known by Afenifere”, the organisation said in an earlier press statement. Continuing, the organisation said: “We frown seriously at the failure of the security agencies to give adequate cover to Ndigbo in the affected communities as these thugs went berserk carrying out the instructions of their political godfathers. “We want to assure our Igbo brothers and sisters that the bond of friendship the Afenifere and Ohanaeze Ndigbo have built particularly under the dynamic leadership of Chief John Nwodo remains strong and will not be broken by the nefarious activities of a few strange children in our midst”.

Collation Centres. “Other exhibits include 2 knives and dry leaves suspected to be Cannabis Sativa “I want to commend all Ndi Anambra for conducting themselves in a peaceful manner and for coming out to exercise their civic responsi-

bilities on Feb. 23. “Despite some isolated cases recorded in some parts of the state where the Command responded promptly and prevented breakdown of law and order, the election was generally peaceful without recording any loss of lives or property.

Police arrest 14 electoral offenders in Anambra Emmanuel Ndukuba, Awka

nambra State Commissioner of Police, Rabiu Ladodo has said that fourteen persons were arrested for various electoral offenses during the justconcluded

Presidential and National Assembly elections in the state. Ladodo, who disclosed this to newsmen in Awka on Tuesday, listed ballot box snatching, disruption of elections, malicious damage and thuggery as among the offences committed by the suspects.

He said the suspects would be charged to court as soon as investigations were concluded. “Exhibit recovered includes 2 vehicles, 2 Motorcycles, 3 Ballot Boxes (snatched from Okpoko), electoral materials such as ballot papers destroyed at Obosi and Ojoto

Wednesday 27 February 2019

NATIONAL DISCOURSE

HOPE MOSES-ASHIKE

lobally, the independence of central banks of nations is almost sacrosanct in view of the growth impact they have on the economy of those nations and by extension, the stability of the nations’ fiscal and monetary policies. In the midst of the on-going general elections that will install a new government in the country, it is important to state that, whoever emerges as the country’s new president, should ensure that the independence of the Central Bank of Nigeria (CBN) is not tampered with. Central Bank independence or autonomy refers to the freedom of monetary authorities from direct political or government interference in the conduct of monetary policy (Walsh, 2005). In recent times, a lot of interest has been generated around the independence of the Central Bank, precisely in terms of formulation and implementation of monetary policy.

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Upholding independence of CBN amid political considerations The mandate of the CBN includes to ensure monetary and price stability, issue legal tender currency in Nigeria, maintain external reserve to safeguard the international value of the legal tender currency, promote a sound financial system, act as banker and provide economic and financial advice to the Federal Government, among others. Following the success of the Bundesbank of Germany in lowering inflation in post-World War II that was attributable to its independence, there has been a growing body of literature on the subject that links Central Bank independence directly to price and monetary stability. A low and stable inflation rate is more likely to be found in countries with independent central banks than in those without independence. One of the benefits of central bank independence is its impact on economic growth. In Europe, the political independence of the European Central Bank (ECB) is instrumental to its primary objective of maintaining price stability. The independence of Nigeria’s Central Bank had in one way or the other been threatened by the government in power. The most recent case was a standoff between the Presidency and the National Assembly over confirmation of new members

of the Monetary Policy Committee (MPC), which was seen as threatening the CBN’s independence and damaging fragile investor confidence in the country. In 2 0 1 7 , Ke m i Ad e ou n , former minister of finance, requested that the National Assembly revoke the independence of the Nigeria’s Central Bank as established under the CBN Act 2007. “The independence of the Central Bank of Nigeria (CBN) must be upheld in order to allow the CBN remain effective and implement policies that are not politically motivated. That is how the international community and foreign business partners will be able to trust the monetary policies that the institution implements. It will also enable the CBN to announce and implement unbiased policies that will maintain financial and price stability which are its core mandates”, said, Ayodele Akinwunmi, head, research, FSDH Merchant Bank Limited. Sanusi Lamido Sanusi, former governor of CBN, in 2012 raised an alarm over a bill tabled in the Senate which sought to compel the bank to submit its annual budget before the National Assembly to facilitate fiscal transparency and accountability. Corroborating Akinwunmi, Johnson Chukwu, managing director/CEO Cowry Asset Man-

agement Limited, said the CBN should be allowed to focus on its mandate and there should be some level of collaboration between the fiscal and monetary authorities. In his view, Uche Uwaleke, professor of finance and capital markets, chair, banking and finance department, Nasarawa State University Keffi, Nasarawa State, said, quite often, central banks are under strong political pressure to adopt lax monetary policies due to budgetary considerations. An elected government worried about its performance at the polls might succumb to the temptation of reducing policy rates ahead of elections at the risk of higher inflation due to the short term nature of its tenure in office. For sure, an independent CBN will be less prone to short-term political influences and is therefore in a stronger position to commit to long-term policies for promoting price stability. Furthermore, greater susceptibility to political influences from separation of the roles will prevent the CBN from acting promptly to prevent or resolve a financial crisis. CEO duality made possible the very decisive step taken by the CBN in 2009 to protect depositors and safeguard the integrity of the banking industry when the then governor, Lamido Sanusi,

removed the Chief Executives/ Executive Directors of Deposit Money Banks identified as great risks to the stability of the sector. Had the CBN not acted as promptly as it did, there would have been systemic crisis with disastrous consequences for the entire economy, Uwaleke said. It is pertinent to note that the situation where the governor acts as chairman of the board is consistent with global best practice and is primarily designed to promote the independence of the CBN. Such independence implies that the apex bank is able to resist undue influences from the government and other interest groups. Without any doubt, a truly autonomous CBN is imperative for the achievement of the goals of the Federal Government Economic Recovery and Growth Plan. With regard to collaboration with the finance ministry, the ministry could be represented on the CBN Board as well as given a non-voting seat on the Monetary Policy Committee. In addition, there should be regular meetings between the Minister of Finance and the CBN Governor, Uwaleke added. Ayodeji Ebo, managing director, Afrinvest Securities Limited wants whichever government that wins election to further the confidence that the CBN has in terms of decision making.

Minimum Wage Bill, others again suffer as Senate adjourns plenary to March 12 OWEDE AGBAJILEKE, Abuja

opes of early passage of the N8.83 trillion 2019 Appropriation Bill, new National Minimum Wage and other critical bills were dashed as the Senate on Tuesday adjourned plenary to March 12, 2019 due to lack of quorum. The adjournment was due to the absence of the required one-third senators (37 lawmakers) needed for plenary to hold. The lawmakers sat for only five minutes with only eight senators in the chambers. Senate President Bukola Saraki presided over the brief session. The House of Representatives raised the minimum wage from N18,000 to N30,000 on January 29. Although the bill has been transmitted to the Senate and was slated on Tuesday Order Paper for First Reading, the

Senate appears likely to pass its own version. Senate Leader Ahmad Lawan, who moved the motion for the adjournment, explained that most lawmakers were in their constituencies because of the National Assembly elections as they were yet to know their fate. “Our members who contested are yet to get their results finally, formally and officially declared and therefore they needed to stay back. And others are also in the field to ensure very smooth election process across the country,” Lawan said. He also urged the Independent National Electoral Commission (INEC) not to further postpone the governorship election already shifted to March 9. The motion was seconded by Senate Minority Whip, Phillip Aduda.

BusinessDay reports that Saraki is one of the biggest casualties of the polls as he lost his Kwara Central Senatorial seat to Ibrahim Oloriegbe of the All Progressives Congress (APC). Before the adjournment, Saraki sought to know the status of the New National Minimum Wage from Sola Adeyeye, chairman of the Adhoc Committee and Senate Chief Whip. In his response, Adeyeye attributed the committee’s delay in working on the proposal to lack of quorum. Although the lawmaker did not seek re-election in the justconcluded Osun Central Senatorial election, he said most of his colleagues did not show up for the committee’s meeting because they were seeking reelection. “We made very frantic effort to try to meet and we have met the same situation we have

found here today, which is lack of quorum. I do hope that after the election, we will be able to form quorum,” Adeyeye said. “I even tried to see if we could have a digital platform. So, I set up electronic platform whereby we could have the meeting and come to a conclusion. Because if you look at the amendment of bill submitted, it had only two clauses. So I thought we could do it electronically but colleagues prefer that we meet in person. I don’t have the power of veto. And colleagues could also not reach a consensus as to when we could meet,” he said. Adeyeye said he had gone to Abuja three times hoping the committee could meet, but he could not force his colleagues who had election to attend the meeting. “I didn’t have election. But after the election, I have to go and take care of my health. Be-

cause there is something inside me that needs urgent attention and I don’t want to, in the name of national service, kill myself prematurely,” Adeyeye said. “So, I would plead that if I am not able to return timely, perhaps the wisest man in the chamber – a long-standing fifth-timer to be – will take over the chairmanship. I mean the Deputy Senate President (Ike Ekweremadu),” he said. On his part, Saraki assured that the Minimum Wage Bill would receive expeditious passage upon resumption by next month. “By the time we resume, this will be the first item for consideration. And I am sure that because of the importance of it, the feedback I have received from a lot of our colleagues is that they also want to contribute personally to the debate,” Saraki said.

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L-R: Tomi Wale, founder of Get up Inc and creative director of the BusinessDay CEO magazine, and Bizzle Osikoya co-founder of the Plug Entertainment posing with a framed picture of the BusinessDay CEO magazine, a digital magazine that tells the stories of Africa’s millennial entrepreneurs.

UNFPA accused of plagiarism by Nigerian researcher DANIEL OBI

hat exactly will push United Nations Population Fund (UNPFA) to be involved in a case of alleged plagiarism by purportedly using the project material of a Nigerian social development researcher without attribution to her remains uncertain. Plagiarism is the practice of taking someone else’s work or ideas and passing them off as one’s own. The researcher, Adaobi Nkeokelonye, is accusing the UN agency, globally regarded for due process and accountability, of engaging and deploying her intellectual work “Female Genital Mutilation in Nigeria, Telling Stories, Raising Awareness, Inspiring Change” for its services, without credit to her. In a petition document seen by BusinessDay, Nkeokelonye, who has for several years worked with international and local or-

ganisations on a broad spectrum of development issues, said having attended UNFPA forum on Female Genital Mutilation (FGM) sometime in 2015, she later proposed further partnership with the Fund to publicise the FGM issues in Nigeria. “My proposal was to explore a publishable work utilising narrative writing, fiction stories. Following my proposal and by a consultancy agreement dated 29th August, 2015, channelled through a UNFPA sub-grantee Action Health Inc (AHI), I was contracted to conduct qualitative research on the trends and practice of FGM, and to produce a report for publication that included the ‘human angle stories’ of affected women.” Nkeokelonye said in furtherance of a joint programme between AHI and UNFPA in the area of FGM prevention in Nigeria, her project was completed with an output being the report “FGM/C in Nigeria, Telling Stories, Raising Awareness,

Inspiring Change”. This was delivered to UNFPA and AHI on November 20, 2015. In her petition, she said following the agreement made with the UNFPA officers, her authorial right of the document was preserved and maintained through the course of revision, adding of all fictional stories, design, proofing as overseen by officers from UNFPA and AHI, unto the final publication and distribution of both hard and soft copies on January 17, 2017. She said, “No part of the work was however written by anyone else as I singlehandedly executed the writing. “In both the published hard and soft copies given to me by the UNFPA, my position as author was stated on page 1, with my acknowledgments of all the people who supported the whole exercise on page 3.” According to Nkeokelonye, one year after the publication, her attention was drawn to a major CNN FGM

story that referenced the same report. She said the CNN publication inspired calls and messages from colleagues and friends who knew about the report. “It was claimed that the ‘authoritative’ available on the UNFPA website had no single mention of me.” To her shock, the report “FGM/C in Nigeria, Telling Stories, Raising Awareness, Inspiring Change” displayed on the UNFPA website was listed under their authorship and upon downloading it, it was clear that it had been doctored to expunge my name as author, my attribution of credit for some photographs, and the acknowledgments in the document replaced with a blank page. “Every trace of credit to me was completely expunged from that document.” She said at no time in producing and collectively preparing this work for publication was an option of anonymity stipulated by AHI or UNFPA or was her right of authorship in contest.

AfDB advocates increasing Africa-Korea partnerships to advance continent’s agro-industrialisation CALEB OJEWALE

he need to increase economic momentum in Africa through partnerships with Korea to advance trade and the industrialisation of Africa’s agricultural sector has been advocated by Akinwumi Adesina, president, African Development Bank (AfDB) Group. “Africa’s partnership with Korea should be more concrete and more structured. We should connect financial instruments and technologies from Korea with the numerous initiatives on the continent,” Adesina said at a meeting with government and busi-

ness leaders, diplomats, development experts, and Korea’s leading agricultural scientists in Seoul this month. Adesina identified two initiatives of the bank, Technologies for African Agricultural Transformation (TAAT) and the Staple Crop Processing Zones (SCPZ), as potential joint venture opportunities for Korean agricultural investment in Africa. Through these initiatives, the bank and its partners seek “to add value to every single thing that is produced, so we can have massive agroindustrialization and valueaddition. We must transform our rural areas from zones of economic misery to zones

of economic prosperity. And the way to do that is to turn agriculture into a big business that works for the poor,” Adesina said. Drumming up support for Africa’s agro-industrialisation, he observed, “Korea and Africa have a strong partnership through the Korea-Africa Economic Cooperation (KOAFEC) with joint initiatives in agriculture, technology and several other areas.” Korea is reputed to have one of the highest research and development investment capacity of any country in the world. According to Adesina, Africa would do well with Korea’s partnership by raising farming productiv-

ity and income, and getting Korea to import some of its food from Africa. Africa’s population and arable land endowments provide ample trade and technology partnership opportunities for Korea and the rest of Asia. Adesina reminded his audience that by 2050 Africa will have 2.5 billion people in a global population of 9.8 billion. “Yet Africa has 65% of the remaining uncultivated arable land in the world, so what Africa does with agriculture will determine the future of food in the world. In doing so, it must use the most efficient and sustainable technology. That’s why our partnership with Korea is so important,” he stated.

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Wednesday 27 February 2019

Shell says FG’s tax claim will delay Bonga FID ISAAC ANYAOGU

il major Royal Dutch Shell said on Tuesday that Nigeria’s claims that it was owed billions in taxes could delay the development of the Bonga South West oil field off the coast of Nigeria. Reuters news agency reported this week that the Nigerian government ordered a number of non-Nigerian oil and gas companies to pay nearly $20 billion in taxes. Analysts say the move could deter investment in Africa’s largest economy. This goes against calls in the sector for the government to create an investment-friendly atmosphere by removing obstacles to investments. Investments in big oil and gas projects have stalled over poor regulatory and fiscal framework and this new tax demand further complicates the process, according to one operator. The Nigerian National Petroleum Corp (NNPC) cited what it called outstanding royalties and taxes for oil and gas production saying the debt is owed state governments. Shell, the largest investor in the West African nation, would likely dispute the charges, Shell’s head of upstream Andy Brown told Reuters on the sidelines of the International Petroleum Week conference. “It is something that has gone through the courts in Nigeria which relates to an

original clause within the original PSCs (production sharing contracts),” Brown said in an interview. “We will have to take it seriously but we think it has no merits,” said Brown, who steps down from his role this year. The outstanding tax issue will delay the final investment decision (FID) on developing Shell’s Bonga Southwest deepwater oil field, one of Nigeria’s largest with production expected to reach 180,000 barrels per day, Brown said. “We’ll need to resolve that before we ever FID the Bonga Southwest project,” he said. Shell has made progress with the government on some basic terms for operating the field but a decision on its development was now unlikely to be made in 2019. “Bonga Shouthwest’s FID may slip into next year,” Brown said. In the Gulf of Mexico, Brown said Shell planned to move swiftly to develop the Whale discovery, which it announced in January 2018. Shell holds a 60 percent stake in the field and Chevron the remaining 40 percent. “We’re going to crack on with the development of this project,” he said, without giving a specific timeline for the development except to say it would be “fast”. He said the field had the potential to be developed into a new production hub for Shell in the Gulf of Mexico.

LAPO MD highlights EDSTMA asks motorists importance of capacity to come for impounded development in promoting vehicles do State Traffinancial inclusion fic Management HOPE MOSES-ASHIKE

odwin Ehigiamusoe, managing director of LAPO Microfinance Bank Limited, Nigeria’s biggest microfinance bank by asset and size, has reiterated the importance of training in expanding the frontiers of financial sector of the economy. He made this assertion while felicitating with 16 members of staff of LAPO Microfinance Bank who were successful in their final examinations of the Institute of Chartered Accountants of Nigeria (ICAN). The new professionals have achieved a vital milestone in self-development, he said, and he congratulated them on behalf of the bank. This brings the number of ICAN members at LAPO Microfinance Bank to 28.

Agency (EDSTMA) has given owners of vehicles impounded for traffic offenses by the agency a 30-day ultimatum to come and reclaim their vehicles in its offices across the state. In a statement, the agency said 46 vehicles had been abandoned in its premises, urging the owners to come forward to reclaim them with valid vehicle particulars. Some of the vehicles have been in the custody of the traffic agency as far back as 2017, and they are spread in the different zones of EDSTMA’s operation. Some of the affected vehicles at the agency’s headquarters include a taxi color Mitsubishi bus with vehicle number BEN409-ZW; an Ox-blood color Toyota Camry with vehicle number GGE783-EU and a taxi color Vanette bus with vehicle number DGE-618-XC.

Wednesday 27 February 2019

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NEWS States’ finances, revenues offer insights into potential debt exposure crisis … only Sokoto, Anambra, Jigawa, Yobe have debt/revenue ratios below 100% MICHEAL ANI

he current financial viability of Nigerian states offers a clue on the possible crisis that might befall them if they were to offset their debts from their current income stream. The other option would be to look inward and deploy other means in growing their revenue base. As of half-year 2018, the total debt of the 36 states and the Federal Capital Territory stood at N5.0tn (assuming the exchange rate of N362.7 for external debt), according to data from the National Bureau of Statistics. This is much higher by 1.4 trillion than a total annualised estimate of N3.6trillion revenue available to the states by the end of 31st December 2018, raising concern on the states’ ability to take in more expenses into their books. “When the IGR is low, there is basically nothing that can be done”, Wale

Aokunrinboye, Head of research at Sigma pension told BusinessDay on phone. “I feel most states need to be more innovative in taxing as many of them are really not doing anything to grow business activities and boost taxes.” As of the end of the third quarter 2018, the total state Internally Generated Revenue (IGR) stood at N843.9bn with Lagos accounting for 34 percent or (N283.5bn), while Yobe generated the least at N2.9bn. The total IGR from Lagos, as of first nine months of 2018, was more than the total IGR from the 30 least generating states (N273.6bn). However, with the FACC allocation inclusive, the total revenue made available to states amounted to N2.7trn in the same period under review. In Similarly, Lagos recorded the largest revenue of N373.5bn while Osun State had the least revenue of N23.9bn. Only Sokoto, Anambra, Jigawa and Yobe states have their total debt-revenue ra-

tios less than 100 per cent. A debt-revenue ratio of less than 100 percent means that a state can conveniently offset its debts from its current income stream. “The first conclusion to draw is that these state governments depended on oneoff inflows rather than stable revenue streams from taxes and levies collected on a regular basis,” analysts at FBN quest wrote in a note to their clients on February 26. “This also goes in telling us that a state government may identify taxable revenue within its territory but still has to create the infrastructure to collect it. “These shortcomings have to be given additional focus now that a rise in the minimum wage from N18, 000 to N27, 000 per month appears to becoming.” The Federal Government in January this year approved the new minimum wage at N27,000, which is 50 percent higher than the current N18,000, in response to the agitation of the labour union since 2018.

Visiting AfDB governors commend bank’s transformative projects ISRAEL ODUBOLA

overnors representing the African Development Bank (AfDB) in West Africa held consultative meetings with the bank’s president and senior management in Abidjan on Monday, February 25, where they commend the accelerated engagement of the bank in the region. 370 transformative projects worth $11.3 billion financed by the bank in West Africa between 2010 and 2017 are touching lives and making a difference, according to the governors. These are the second consultative meetings, aimed at sharing views with the governors, after the first ever meetings in the history

of the Bank was instituted by the bank’s president, Akinwumi Adesina. “Our ultimate goal is to ensure that the Governors are much closer to the Bank, and that you are integrally involved in the wider vision and direction, particularly as it pertains to the challenges and needs of your respective region,” Adesina said in his opening remarks. “Today, I am filled with hope. Hope because Africa is changing. Hope because across the continent, despite challenges, you can see a rising determination to turn things around,” he said. Ministers were charged during the consultations to exert efforts to bridge the gender gap, address climate change and intensify attention to the development of fragile states.

Acknowledging the bank as the economic arm of African Union (AU), governors stressed the need for it involvement in global issues in order to influence and help shape the conversations around foreign investments. Governors also deliberated on institutional capacity building, data collection, nutrition, digitalization and regional integration. Sierra Leone Minister of Finance, Jacob Saffa, called for the need to mobilize domestic funds and pension funds. “Infrastructure is very essential. We hope the bank will continue to support and add value to our one government data platform,” said Mogana Flomo, Liberia’s Minister of Agriculture.

Obaseki to revamp Irrua Technical College, assures of more job creation initiatives in Edo Central

do State governor, Godwin Obaseki, has assured Edo residents of his administration’s plans to refurbish the Government Science and Technical College, Irrua, as part of ongoing effort to reposition Technical and Vocational Education and Training (TVET) in the state to boost skilled workforce. The governor gave the assurance at the official flag-off of remediation work on Ewu and Ibore gully erosion sites in Esan Central Local Government Area of

the state. He said the next plan for the council is economic empowerment for youths through technical education and revitalisation of Ewu Flour Mill, which will provide jobs. “The technical school at Irrua will be rehabilitated so that our youths can acquire skills that would enable them sustain themselves.” Recall that while on an inspection tour of ongoing rehabilitation work at the Government Science and Technical College (GSTC),

formerly known as the Benin Technical College, in Benin City, Obaseki said that the state government was working with the World Bank and Federal Ministry of Education to access a facility that would be used to promote technical education in the state. He added that the facility, which is expected to be available by June this year, would be used to replicate the structures being constructed at the GSTC in Edo Central and Edo North senatorial districts.

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FX turnover rises 380.3% as CBN injects $210m into market HOPE MOSES-ASHIKE

… external reserves fall to $42.38bn

he foreign exchange daily turnover increased significantly by 380.3 percent to $354.88 million on Tuesday compared with $73.88 million recorded the previous day at the Investors and Exporters forex (I&E) window. The Central Bank of Nigeria (CBN) has injected the sum of $210 million into the inter-bank foreign exchange market. Nigeria’s external reserves have declined to $42.38 billion as of February 25, 2019, data obtained from the CBN website show. Figures obtained from the CBN on Tuesday, indicated that authorised dealers in the wholesale segment of the market were offered the sum of $100 million, while the Small and

Medium Enterprises (SMEs) segment received the sum of $55 million. Similarly, customers requiring foreign exchange for invisibles such as tuition fees, medical payments and Basic Travel Allowance (BTA), among others, were also allocated the sum of $55 million. The CBN’s intervention helped to strengthen the local currency further. Consequently, naira appreciated marginally by N0.04k to close at N361.50k per dollar on Tuesday as against N361.54k traded the previous day at the I&E forex window. At the CBN’s official window, the nation’s currency remained stable as it closed at the rate of N306.85k per dollar, data from FMDQ revealed.

Confirming the figures, Isaac Okorafor, the CBN’s director, corporate communications department, reiterated the CBN’s commitment to continue to boost interbank foreign exchange market to ensure liquidity in the market. It would be recalled that on Friday, February 22, 2019, the bank injected the sum of $268.4 million and CNY46.3 million into the Retail Secondary Market Intervention Sales (SMIS) segment. Meanwhile, the naira on Tuesday, February 26, 2019 exchanged at an average of N360/$1 in the Bureau De Change (BDC) segment of the market. In his personal statement at the last Monetary Policy Committee (MPC) meeting, Aliyu Rafindadi Sanusi, member of the MPC said

exchange rates have been broadly stable during the year 2018. The average rate at the Investor and Exporter (I&E) window, for example, slightly depreciated from N360.53 per USD in January 2018 to N364.76 per USD in December 2018, representing a depreciation of 1.13 percent. The exchange rate was even more stable at the BDCs segment where it depreciated by only 0.07 per cent from N363.20 per US dollar in January 2018 to N363.46 in December 2018. External reserves, which have been key to the stability achieved in the foreign exchange market, have also increased from $39.35 billion in December 2017 to $42.54 in December 2018, representing a growth of 8.11 percent.

FG inaugurates National Obstetric Fistula Committee

inister of Health, Isaac Adewole, has i nau g u rat e d Inter-Ministerial Committee on the establishment of the National Obstetric Fistula Centres in Nigeria towards ensuring the reduction of Obstetric Fistula cases. Boade Akinola, director, media and public relations of the ministry, made this known in a statement issued on Tuesday in Abuja. Akinola said the Federal Government had designated three facilities located in Kaduna, Bauchi and Ebonyi States as National Obstetric Fistula centres for prevention, treatment, training and research. She quoted Adewole as

Wednesday 27 February 2019

Alleged N2.5bn fraud: ICPC to arraign NBC boss, others

Peter Obi, Vice Presidential Candidate of Peoples Democratic Party (PDP), addressing newsmen on the outcome of 2019 Presidential Election at his residence in Onitsha on Tuesday

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saying that the National Centres were expected to provide technical backstopping as well as act as referral centres to the several health facilities where fistula cases were diagnosed in the six geopolitical zones. “To this end, new centres would be located in Adamawa, Edo, Niger, Osun and Oyo states; with Oyo State site serving as a Regional centre. The prevention and treatment of obstetric fistula was a priority of the Federal Government. “Consequently, the establishment of more Obstetric Fistula Centres demonstrate government’s commitment to the improvement of the maternal and reproductive

health indices,” he said. The minister said government was working relentlessly to ensure availability of functional Primary Health Care centres, skilled birth attendants, as some of the preventive measures against obstetric fistula. According to Adewole, government would also ensure adequate supply of essential maternal health commodities for the provision of quality antenatal care, safe delivery and postnatal care for women and children. The minister urged the committee to come up with recommendations, strategies, interventions and roll-out plans for the establishment of the centres in addition to facili-

tating funding for the projects. The Committee’s chairman, Abdulaziz Abudullahi, assured that the committee would do its best in achieving the terms of reference and duly submit its report on time. Abdullahi, who is also the Permanent Secretary of the Ministry, also pledged that the committee would work assiduously to deliver on their assignment. Director, Family Health, Adebimpe Adebiyi, said that Obstetric Fistula was a serious and prevalent reproductive health challenge for women in the developing world. Adebiyi said Nigeria bore about 40 percent of the global burden.

ederal High Court, Abuja has fixed March 12 for the Independent Corrupt Practices and Other Related Offences Commission (ICPC) to arraign the Director-General of the National Broadcasting Commission, Ishaq Modibbo over alleged N2.5 billion fraud charge. He was charged by the Federal Government alongside the managing director of Pinnacle Communications, Dipo Onifade, founder and chairman Board of Directors of Pinnacle, Lucky Omoluwa, and Pinnacle Communications Limited on January 21. When the matter was called, the ICPC Counsel, Henry Emore made an oral application to withdraw the earlier charge filed on January 21. Emore informed the court that he was substituting the charge dated January 21, with another one dated February 21 because the first charge contained noticeable errors Alex Izinyon, who announced appearance for Onifade, Omoluwa and Pinnacle, did not oppose the application to withdraw the first charge. Consequently, the judge, Justice Folashade Giwa-

Ogunbanjo struck out the charge dated January 21 and replaced it with the one dated February 21. The court also granted an order of substituted service against the NBC boss. The court ordered that the charge and summons be pasted on the last known address of Modibbo. The court further directed the prosecuting counsel to effect service of the charge on Onifade, Omoluwa and Pinnacle, within 48 hours, since Izinyon had accepted to receive the charge sheet on their behalf. Giwa-Ogunbanjo adjourned the matter until March 12 for arraignment of the accused persons. The fresh charges read in part: “That you, Is’haq Modibbo, Lucky Omonuwa and Dipo Onifade sometime between Dec. 2016 and May 2017 in Abuja within the jurisdiction of this Court, conspired with each other to use the position of Modibbo as the Director-General of NBC to confer corrupt advantage on Omonuwa, your friend and associate by recommending to the Minister of Information and Culture to approve payment of N2.5 billion to Pinnacle Communications Limited.

Immortalising black achievements will boost leadership skills – US consulate

ussell Brooks, Public Affairs Officer, United States ConsulateGeneral, Lagos, on Tuesday said that sensitising the public on the past achievements of black people would encourage youths to become better leaders. Brooks made the assertion at the second series of the Black History Month at the Institute of African and Diaspora Studies (IADS), University of Lagos. The event which began on Tuesday will end on March 7. He said there was the need to make people to be aware of the many contributions that people of African descent had made to humanity. “Some people are not aware, while some tend to diminish these facts. Therefore, Black History Month is an opportunity to highlight these things and sensitise people to what has actually taken place. “I suspect that if I go into some schools in Nigeria, I will find some students that are not aware of some of the great African civilisations that existed before the colonial era. “Therefore, celebrating the black month is an opportunity to highlight these things and encourage the future generation,’’ he said.

Brooks urged Nigerian schools to begin to celebrate black history, have books about black history as well as acquaint teachers with the knowledge of black history. “All these things are necessary to pass along our accurate story to our young people. This will give them a sense of pride on what has been accomplished before, and they will be inspired to accomplish even greater things in the future,’’ Brooks said. Folashade Ogunshola, Deputy Vice-Chancellor, Development Services, University of Lagos, said that celebrating the achievements of black people will give the younger generation black role models to emulate. “Talking about black achievement is important so that when the stories are written, young people will have role models from any part of the world. “We must look back at what we have done and talk about them because if we do not learn to tell our own stories, someone else will do it to their own advantage. “We must recognise that we have done a lot, and look back because if we do not know where we are coming from, how would we know where we are going,’’ she said.

Wednesday 27 February 2019

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What shape could a US-China trade agreement take? Series of key elements to be included in the contours of a possible deal James Politi

onald Trump’s pronouncement of a delay in the deadline for a planned rise in tariffs on Chinese imports, citing “substantial progress” in negotiations with Beijing at the weekend, has increased expectations that a deal will be reached to end the trade war. The US president said the talks were in “advanced stages” and the final details would be ironed out at a new summit with Xi Jinping, the Chinese president, at Mr Trump’s Mar-a-Lago resort in southern Florida. If that holds true, what would such an agreement look like? In recent weeks, as Robert Lighthizer, the US trade representative, and Liu He, the Chinese vice-premier, have squared off in the talks, the contours of a possible deal — to be laid out in a binding document — have gradually taken shape. Negotiations could still fall apart at the eleventh hour, bringing Washington and Beijing back to a new round of tariffs, but if a deal is reached, it will almost certainly include the following elements, according to people briefed on the talks. China’s purchase of US goods China is expected to com-

mit to sharply ratcheting up its purchases of US goods, starting with agricultural products such as soyabeans, corn, wheat, beef and poultry. Mr Trump has often complained about the yawning US trade gap with China, and these measures are intended to reduce that deficit. Moreover, farmers in America’s heartland have borne the brunt of Mr Trump’s trade war with China, because of the impact of retaliatory tariffs, so this would be big reward. Sonny Perdue, the US agriculture secretary, said on Twitter last Friday that China had already committed to buying an additional 10m metric tonnes of soyabeans. More specific numbers for other goods are expected to be part of any agreement. Intellectual property rights China will take some steps to bolster the protection of US intellectual property rights, after widespread complaints from American business that China is actively promoting the theft of US trade secrets, or at least turning a blind eye to it. China is also expected to curb the forced transfer of technology from US companies operating in the country, which has long been seen as essential to smoothing entry into the Chinese market. These issues have been a big sore point between the two countries,

and lie at the heart of the trade war. It is still not clear, however, how far China will go in changing its regulatory and legal regime in this area to satisfy US concerns. Currency stability China is expected to agree to maintain a stable renminbi — code for a pledge to prevent its currency from sliding against the dollar, which gives its exporters a competitive advantage. For years, China trade hawks in the

US have complained that Beijing manipulates its currency to keep it artificially low, and have sought to force China to change its ways. But Beijing has insisted it does not engage in any form of competitive devaluation, and if its currency declines in value, this is simply a reflection of market forces. Regulatory relief China is expected to take some steps to make it easier for foreign companies to do business in the

country, such as by limiting restrictions on international investments and making it easier for foreign companies to gain regulatory approvals in areas such as biotechnology and chemicals. In financial services, all eyes are on whether China will allow Visa and Mastercard to operate, an opening that has long been delayed. The details of these specific commitments could be crucial to securing support for the deal from the US business community.

Upstarts challenge private equity’s top tier Theresa May opens way to a Brexit delay if her deal is rejected Veritas joins once-obscure groups writing big cheques and grabbing assets from clutches of larger rivals Eric Platt and Mark Vandevelde

efore Veritas Capital teamed up with activist hedge fund Elliott Management to pull off one of the biggest private equity deals of 2018, the New York buyout firm was known for its work with niche businesses such as a manufacturer of components for satellites. But the $5.6bn buyout of Athenahealth catapulted Veritas into a higher orbit. There, it joins half a dozen once-obscure private equity players that have broken into the industry’s top tier, capable of writing large equity cheques and snatching coveted assets from the clutches of Apollo, Blackstone and KKR. The $6.5bn takeover of analytics group Dun & Bradstreet and $4.1bn purchase of travel technology provider Travelport were sealed by buyout firms that had long focused on smaller midmarket deals, with competition for assets intensifying as investors pump billions of dollars into new PE funds, bankers and lawyers say. The rarefied world of the biggest deals is attractive as it contains the best return prospects, according to Michael Chae, chief financial officer of the Blackstone Group. Smaller deals, in contrast, tend to have three or four groups competing and bidding prices higher. “We think mid-market secondary buyouts have been the most crowded, competitive space where we’ve seen the most return pressure,” said Mr Chae. “Larger scale

primary deals, corporate sellers, corporate partners, more complex, more operational value creation potential, we think that’s where the better fishing has been.” An increasing number of firms are angling for bigger buyouts. Siris Capital, Francisco Partners and Veritas Capital are among the firms that struck deals for more than $3.5bn each last year. “There is a longer list of private equity firms with unused equity capital highly motivated to put that capital to work,” said Chris Ventresca, global co-head of M&A at JPMorgan. “They are more willing to utilise a significant amount of equity capital and make more sizeable bets.” For both Siris and Veritas, Elliott Management’s private equity arm Evergreen Coast Capital was critical to clinch their largest deals. Elliott has ramped up its buyout efforts, which are often directed at companies that the firm has itself targeted as an activist. Founded by Paul Singer and known for its brash style, Elliott is raising $2bn to fund outright takeovers. Marni Lerner, a partner at law firm Simpson Thacher, said those efforts are fuelled by cash inflows from pensions, endowments and sovereign wealth funds, as well as a $1.2tn stockpile of committed capital that has yet to be deployed. “You see larger firms working on mid-market deals . . . and midmarket firms are looking for larger deals,” Ms Lerner said. “Fund sizes are getting bigger, which is allowing [mid-market firms] to do larger deals.”

Prime minister says if meaningful vote fails, MPs will have choice of no-deal or extension Jim Pickard

heresa May has told the House of Commons that if her Brexit deal is rejected on March 12, MPs will be given the choice between a no-deal Brexit or extending the Article 50 exit process from the EU. It is the first time that the UK prime minister has openly accepted that Brexit could be delayed, having insisted for months that the UK would leave the EU on March 29 without a deal if necessary. The move — which Mrs May suggested could ultimately delay Brexit for up to three months beyond the scheduled date of March 29 — is aimed at heading off resignations by about a dozen pro-EU ministers who are determined to prevent the economic harm of a chaotic departure from the bloc. Speaking in the House of Commons on Tuesday, Mrs May said that MPs and business were worried that “time is running out”, adding that parliament needed to have its voice heard on the way forward. The prime minister, whose initial Brexit package was rejected by a record 230-vote margin last month, said the “meaningful vote” on a revised deal with the EU would take place by March 12. If the Commons still rejects the deal, there will be a vote by March 13 to decide whether parliament instead endorses a no-deal Brexit. “The UK will only leave without a deal on 29 March if there is explicit consensus in the House for that outcome,” she said.

She added that if parliament rejected no-deal, MPs would then be asked by March 14 whether they wanted a “short limited extension to Article 50”. If they did, the government would subsequently seek the EU’s agreement for a delay and bring forward the necessary legislation. Some business groups welcomed the shift but called for much greater reassurance that Britain would avoid a no-deal Brexit. “While this is a giant political leap for the prime minister, this is only a small step towards the clarity and precision that businesses need to chart their future direction,” said the British Chambers of Commerce. “The overriding priority is still to assure businesses and communities that an unwanted no-deal scenario will not happen by default on March 29.” The Institute of Directors added that “while an extension is not an end in itself, it may become a necessity to achieve an orderly exit”. However, Mrs May warned that no extension should last beyond the end of June, since otherwise the UK would need to participate in elections to the new European Parliament, which will take its seats at the beginning of July. “I do not want to see Article 50 extended,” she added, arguing that the only way to take no-deal off the table would be to either revoke the UK’s request to leave the EU — an option she excludes — or to agree a deal. “Ultimately the choices we face would remain unchanged,” she added. “Leave with a deal, leave

with no deal or leave with no Brexit.” Only a minority of MPs in the Commons would back a no-deal Brexit while there is thought to be a majority for extending Article 50 if necessary. But Mrs May’s strategy risks a split with the pro-Brexit European Research Group of Tory MPs as well as Northern Ireland’s Democratic Unionist party, which provides her government with a majority in parliament. Arlene Foster, leader of the DUP, told Bloomberg: “I don’t think an extension is going to solve any of the issues that are already there. Often in negotiations you need that compression of time to come to a deal.” Responding to Mrs May, Jeremy Corbyn said the government was “grotesquely reckless”, suggesting Downing Street was deliberately running down the clock. The Labour leader said his party would back amendments designed to rule out the “reckless cliff edge” of a no-deal Brexit. “She promises a short extension but for what?” Mr Corbyn asked. “If the government wants a genuine renegotiation it should do so on terms that can win a majority of this House.” Labour has proposed a softer Brexit, involving a permanent customs union with the EU. A Labour amendment setting out such a goal is widely expected to be rejected in a vote on Wednesday, after which the party is due to swing its support behind a second referendum that would have an option to remain in the EU.

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FT Iran’s lawmakers urge foreign minister not to quit

Kim Jong Un steals limelight in Hanoi ahead of talks with Trump Foreign journalists descend on opaque communist country to cover nuclear summit

Mohammad Javad Zarif’s resignation offer threatens to exacerbate internal power struggle

John Reed

Najmeh Bozorgmehr and Andrew England

ranian lawmakers have urged foreign minister Mohammad Javad Zarif to withdraw his surprise offer to resign, a move that has thrust internal power struggles into the spotlight as the Islamic republic grapples with US sanctions. If Mr Zarif follows through on his decision to quit it would be a severe blow to President Hassan Rouhani and factions within the regime that are battling to keep Iran’s landmark 2015 nuclear deal alive in the wake of Donald Trump’s decision to withdraw from it. Mr Zarif, a key architect of the nuclear accord, has been leading Iran’s efforts to work with Europe, Russia and China to counter the impact of the Trump administration’s sanctions. But he and Mr Rouhani have faced mounting resistance from regime hardliners who are seeking to consolidate their power and feel vindicated in their criticism of the nuclear deal. Iran has a tradition of keeping a lid on internal power struggles to prevent “the enemy”, as the US is known, from exploiting differences. But the infighting burst into public view on Monday evening at a time when hardliners in the Revolutionary Guards and the judiciary are more willing to attack Mr Rouhani’s government. On Tuesday in Tehran politicians were waiting to see whether Mr Rouhani would accept his resignation or whether Ayatollah Ali Khamenei, the supreme leader, would intervene to convince Mr Zarif to reverse his decision. “So far 150 members of parliament [out of 290] have signed the petition,” Mostafa Kavakebian, a reformist member of parliament told local media on Tuesday. Some members of Mr Rouhani’s cabinet have also urged the minister to stay in his post. Mohammad-Javad Azari Jahromi, telecoms minister, said on Instagram: “Do not sit down brother. Stand up dear Javad! People are worried.” Speculation was rife in Iran that Mr Zarif’s resignation offer was triggered by anger that he was apparently not informed about a visit to Tehran by Syrian president Bashar al-Assad on Monday. Mr Khamenei and Mr Rouhani received Mr Assad at a meeting, but Mr Zarif was absent. Unusually, Qassem Soleimani, the commander of the Revolutionary Guard’s overseas forces and a powerful hardline figure, was present. Mr Zarif announced his resignation offer shortly after the meeting in a post on Instagram. “I sincerely apologise people for not being able to continue serving them and for all the shortcomings” during the past 67 months, he said. The state-run IRNA news agency said on Tuesday that Mr Zarif told colleagues his resignation would aid “restoring the ministry to its legal position in foreign relations”. A European official told the Financial Times that it would not be “game over” for European efforts to keep the nuclear deal alive if Mr Zarif followed through with his resignation.

Wednesday 27 February 2019

Sudanese President Omar al-Bashir has appointed military and security officials to run the country’s 18 states and has reshuffled his government for the third time in 12 months © AFP

Sudan’s Omar al-Bashir plays ‘last card’ to retain power

President’s state of emergency has provoked further protests against his decades-long leadership Zeinab Mohammed Salih and Tom Wilson

udan’s president is returning to his roots as a military ruler in an attempt to re-establish control of the country, as prolonged street demonstrations and divisions in his party put his leadership under unprecedented strain. Omar al-Bashir imposed a nationwide state of emergency and appointed military and security officials to run Sudan’s 18 states last week, while also reshuffling his government for the third time in 12 months. “He’s playing what seems like a desperate last card,” said Murithi Mutiga, a Sudan expert at the International Crisis Group. “He has no tools to fix the economy and no credible answers to the protesters’ demands, so he has thrown his lot in with the military.” The Sudanese president also promised to reopen a national dialogue on the political and economic situation in the country — but opposition leaders rejected the offer of talks and protesters took to the streets with renewed fervour. The demonstrations, which have spread to some 35 cities since a protest in December over the rising price of bread, have become the biggest threat to Mr Bashir’s rule since he seized power in a military coup in 1989. The 75-year-old leader has survived previous ruptures in his ruling party, an international warrant for his arrest and the secession of half

of his country — but the unrelenting protests and a near total collapse in the country’s economy have left him with little room for manoeuvre. The value of the Sudanese pound plummeted 85 per cent against the dollar last year and inflation is running at more than 70 per cent, rendering normal life virtually impossible for many of Sudan’s 40m people. The protest movement, initially led by doctors, lawyers and other professionals fed up with the longterm erosion of living standards, has broadened in the past two weeks to include leaders from Sudan’s political opposition and may now be spreading to members of Mr Bashir’s own party. In the hours before the president addressed the nation on Friday, Sudan’s intelligence chief, Salah Abdallah Gosh, briefed journalists that Mr Bashir would step down as head of the ruling National Congress party and would not run again in 2020. In the end, the president made neither commitment. Instead, Mr Bashir promised only that he would postpone a parliamentary vote in April on his eligibility for re-election and appoint a government of technocrats to revive the economy. The mixed messages left critics with little doubt that this was another attempt by Mr Bashir to maintain control. “I took to the street immediately after listening to Bashir’s speech and spent all the night protesting” said Mohamed Fathi, a 25-year-old

university graduate. “What [Mr Bashir] has said was a provocation, we want him to step down without conditions.” Mariam al-Sadig, deputy head of the opposition Umma party, which marched with protesters on Thursday for the first time, dismissed the call for further talks. “The president needs to step down from presidency and the ruling party should stop empowering itself and consolidating power”, she told local press. Mr Bashir’s new “technocratic” cabinet includes Moustafa Houli, a veteran of the finance ministry, who was appointed as its head on Sunday. But few Sudanese believe anyone can revive the country’s ailing economy while Mr Bashir remains at the helm. Help from international finance institutions, such as the IMF, is unlikely while Mr Bashir is under indictment by the International Criminal Court and Sudan is still listed by the US as a sponsor of terrorism. This may be one reason, analysts say, why some members of the ruling party seem to be finally losing patience with their long-term benefactor. Throughout his presidency, Mr Bashir, who first joined the Sudanese army in 1960, has sought to balance support from the military and Islamist wings of the NCP. While it is too soon to predict a split, Mr Bashir is likely facing growing pressure from the party’s civilian wing to step down next year, according to Muhammed Osman, an independent analyst based in the capital, Khartoum.

Goldman hires 100 staff for new cash management business US bank tries to steal market share from Citi and JPMorgan and diversify earnings Laura Noonan

oldman Sachs has hired 100 staff for its fledgling corporate cash management business, as the Wall Street bank rushes to steal revenues from Citigroup and JPMorgan Chase. A person familiar with the situation told the Financial Times that Goldman had already recruited about a third of an initial 300-person target for the venture, which was announced in January. Goldman pledged to use cuttingedge technology to tackle the “pain points” its investment bank clients encounter with traditional providers of services to handle payments and surplus cash. Winning even a small market share from incumbents such as Citi and JPMorgan would advance Goldman’s quest of further diversifying earnings from its traditional — and volatile — base of investment banking fees and trading.

Cash management also offers Goldman access to a new funding source — clients’ operating deposits — which is cheaper than the wholesale money that makes up 60 per cent of Goldman’s existing funding base. A clutch of ads has recently appeared on professional network LinkedIn soliciting applications for everything from engineers to fraud experts who want to work for a cash management venture that “combines the strength and heritage of a 148-year-old financial institution with the agility and entrepreneurial spirit of a tech start-up”. The person familiar with the situation said about 100 people have already been hired, mainly from engineering disciplines. Many of them have previously worked for fintech groups. The bank will add another 200, spread across London, New York and Bengaluru, in India, the person added.

The bank has not formally named a head for the cash management business. Former JPMorgan commercial banking technology executive Hari Moorthy, who joined Goldman as a partner last April, is seen as a leading candidate. Goldman declined to comment on its cash management hiring. On the bank’s January earnings call, David Solomon, chief executive, said Goldman was already six months into a two-year programme to build the cash management business, putting it on track for a full launch in 2020, four years after Goldman entered the retail banking market with the launch of online bank Marcus. Marcus, including money management service Clarity Money, now has 3m customers and $35bn in deposits, though it is still not significant enough for Goldman to publish separate financial data on its quarterly earnings.

im Jong Un arrived in Hanoi for a bilateral summit with the Vietnamese government on Tuesday ahead of this week’s meeting with US president Donald Trump, trailed by a foreign press pack struggling to cover an encounter between two of the world’s most opaque communist governments. The North Korean leader disembarked from his specially outfitted train at Vietnam’s Dong Dang border station on Tuesday morning, ending a 4,500km trip that began on Saturday before entering a black limousine for the drive to Hanoi. “It’s the first time that Vietnam organised this great a conference,” said Hoai Anh Pham, an English teacher who was waiting with a crowd of onlookers outside Mr Kim’s hotel in Hanoi and had given his students the day off. “We are so proud of that.” On Thursday, Mr Trump and Mr Kim will hold their second round of summit talks, in which Washington will be pressing Pyongyang for firm commitments to fill out their broad denuclearisation of the Korean Peninsula made in Singapore last June. While Mr Trump has lowered expectations ahead of the meeting, there has been speculation that the two sides may agree to establish liaison offices in their respective countries, or to a peace declaration formally ending the Korean war. The US president is due to arrive later on Tuesday evening — he will meet Mr Kim briefly on Wednesday evening for a talk before a formal dinner — leaving the focus for the moment on the reclusive North Korean leader. Neither Vietnam nor North Korea released details of Mr Kim’s itinerary for the bilateral portion of the visit, which the North Korean leader made at the invitation of Nguyen Phu Trong, Vietnam’s communist party leader and president. Police stationed tanks in Hanoi’s city centre, while in the city’s cramped, touristy Old Quarter, vendors were cashing in, selling Vietnamese and US flags and freshly painted T-shirts showing Mr Trump and Mr Kim, or the North Korean leader’s features outlined in an enigmatic, Warholesque block print. For Vietnam, hosting the event is a rare opening for a one-party state that gets little foreign coverage and keeps close tabs on the limited number of foreign journalists who cover it regularly. According to Vietnam’s ministry of foreign affairs, 2,600 Vietnamese journalists were given accreditation to cover the summit, along with 400 foreign reporters and another 350 from the White House press corps. A small number of journalists who flew to Hanoi to cover the event were sent an email from the summit’s Foreign Press Center exhorting them to write “positive articles and reports about the meeting and about Vietnam”. “You should follow the applied schedule and should not collect, write or (distribute) news of any irrelevant or ‘sensitive’ topics,” said the email, seen by the Financial Times. Last week, diplomats and communist party officials told the FT that Mr Kim would meet Vietnam’s leadership and travel to Bac Ninh province near Hanoi and the port city of Haiphong, where the Vietnamese conglomerate Vingroup has built a new car plant.

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Magic Leap strikes distribution deal with South Korea’s SK Telecom Google and Alibaba-backed augmented reality start-up launched first headset last year Tim Bradshaw

agic Leap has struck its first international distribution agreement, partnering with SK Telecom to launch its augmented reality headset in South Korea. The deal comes as mobile operators look for new devices that will catalyse demand for new 5G networks, which will launch around the world this year. It follows last year’s tie up between Magic Leap and US operator AT&T, which took a stake in the Floridabased start-up. Magic Leap, which has raised more than $2bn from investors such as Google, Alibaba and Saudi Arabia’s sovereign wealth fund, launched its first “spatial computing” headset last year with a retail price tag of $2,295, but is now facing renewed competition, including from Microsoft’s HoloLens 2, which was unveiled this week at Mobile World Congress in Barcelona. Omar Khan, Magic Leap’s chief product officer, said that the company was looking to South Korea because the country proved such an early adopter of smartphones and 4G networks. “We think they will be at the forefront of 5G deployment and adoption as well,” he said, adding that while the current Magic Leap One device does not support 5G connections, “future versions of the product will incorporate” the technology.

“5G does away with physical boundaries,” Mr Khan said. “Spatial computing is the premiere-use case for 5G.” The ability to wear Magic Leap outdoors, beyond the range of WiFi, could be vital to proving the utility of a device that has so far split analysts and industry observers. While many in Silicon Valley anticipate headsets that can precisely place digital objects upon the real world will prove to be the successor to the smartphone, early versions such as Magic Leap and HoloLens have been criticised for being too expensive and bulky to appeal to mainstream consumers. “We are still technically in the ‘creator’ phase,” Mr Khan said, explaining that the current model is aimed primarily at developers and content creators who are writing software and apps for the device. “But we are very quickly evolving into broader availability.” Unlike Microsoft, which has focused HoloLens 2 on corporate and industrial customers, Magic Leap is aiming for a much broader audience, with consumer-friendly apps such as Star Wars: Project Porg and NBA basketball games. “We are creating an all-day, everyday system,” Mr Khan said. He also took a swipe at Microsoft’s approach with its new HoloLens, saying: “Everyone who is in and around this space helps push this space forward. The key is we have to do it in a form and fashion that respects the human eye-brain system.

Sterling rallies as Theresa May offers to delay Brexit Volatile run takes China stocks off 8-month high, Wall St and European bourses slip Michael Hunter and Hudson Lockett

he pound remained around a four-month high against the dollar, hitting the UK’s main stock index, as Theresa May raised the prospect of a delay to the country’s departure from the EU. A postponement was among options offered for a subsequent vote in the UK parliament if a planned deal for a Brexit deal is rejected in the House of Commons on March 12. MPs will also vote on a motion asking if they back a no-deal departure, seen as unlikely to secure a majority. Sterling touched its highest level against the dollar since October earlier in the session when speculation of such a move preceded the announcement in the Commons. After it was made, the pound remained higher — by 0.7 per cent at $1.3190 — having been up by as much as 1.1 per cent to $1.3237. It also strengthened against the euro — by 0.8 per cent, with a unit of the shared currency costing £0.8606, a level not seen since May 2017. Meanwhile, after stocks in China faded back from eight-month highs, European bourses slipped and Wall Street followed, with the S&P opening down 0.2 per cent after two consecutive sessions of gains. Momentum ebbed from global

equities markets as investors remained on watch for further clear signs of improvement in trade relations between Beijing and Washington. Equities The FTSE 100 fell 0.7 per cent, with major dollar earners under pressure. Engine maker Rolls-Royce fell 0.6 per cent. Luxury fashion brand Burberry lost 1.3 per cent. Frankfurt’s Xetra Dax 30 slipped 0.1 per cent, with consumer and industrial stocks weaker. But there was relief that BASF’s fourth-quarter earnings were not as bleak as forecast, helping its stock outperform the index with a 4 per cent rise, even after a 59 per cent decline in earnings, with its basic petrochemicals operation flagging. China’s stock markets seesawed between gains and losses a day after their best one-day gain in three years. The CSI 300 ended down 1.2 per cent, in a volatile run that followed the previous session’s eight-month highs. The choppy performance came after the rally took the index into bull market territory on Monday, an advance fuelled by US president Donald Trump’s decision to delay raising tariffs on imports of Chinese goods. In Hong Kong the Hang Seng index shed 0.7 per cent. Tokyo’s Topix was off 0.2 per cent.

US urges Europe to exclude Huawei from 5G network builds Nic Fildes

S government officials have laid out their case for banning Huawei from 5G network builds in Europe after calling the Chinese company “duplicitous and deceitful”. Robert Strayer, ambassador for cyber and international communications in the State Department, did not point to any specific evidence of Huawei installing backdoors or its equipment being co-opted by the Chinese state. However the official, who spoke alongside Federal Communications Commission chairman Ajit Pai, and Lisa Porter, an under secretary in the department of defence, made the case for excluding the Chinese supplier. “Threats to US networks have a direct bearing on the security of our allies just as threats to our allies networks have a direct bearing on the security of our networks. To this end we ask other governments and the private sector to consider the threat of Huawei and other Chinese information technology companies,” said Mr Strayer. He cited a report by the British government’s National Cyber Secu-

rity Centre pointing to technical issues in Huawei’s kit and pointed to Chinese laws whereby the government could compel companies like Huawei to provide access to their customer’s data. “America is calling on all our security partners to be vigilant and avoid vendors that could compromise the integrity of global communications technology,” he said. US officials, including the Department of Commerce and the US agency of international development, are meeting with European politicians and network representatives at Mobile World Congress to press their case. Mr Strayer said they were making “great progress” in convincing governments to work with them in recognising the threats in the supply chain. Pressed on what evidence he could present to sceptical governments that have already allowed Huawei equipment into the telecoms networks, Mr Stayer said: “Really I’d say the question is this: Do you want to have a system that is potentially compromised by the Chinese government or do you want to go with a secure alternative?” He added that networks in Europe that have declared support for

Huawei needed to think about the cost of replacing compromised 5G equipment in the future. “If you find vulnerabilities after the fact, as the UK’s oversight board has concluded, it is going to cost you a lot more money to patch that and do further updates,” he said. Mr Strayer also said that the pressure it was exerting was not related to a trade war with China nor “retaliation” for previous cyber attacks by the Chinese state, despite citing examples of such attacks repeatedly. “Security concerns are driving our entire effort,” he said. Guo Ping, Huawei’s rotating chairman, kicked off day two of Mobile World Congress with a statement that no backdoors have been found in Huawei’s telecoms equipment. Instead in his speech at MWC, Mr Ping pointed to the American security officials’ history of interference, notably the Prism US communications monitoring programmes described in documents released by whistleblower Edward Snowden. “Prism, prism on the wall, who is the most trustworthy of them all? It is a very important question and if you don’t answer that, you can go and ask Edward Snowden,” said Mr Ping.

JPMorgan vows to get more value from technology spend Laura Noonan

PMorgan Chase needs to avoid “building everything from zero” and instead build on top of past innovations, said Daniel Pinto, head of corporate and investment bank, as he vowed to get more value from the company’s multibillion-dollar industry-leading technology spend. “We need to avoid building everything from zero to one hundred every single time,” the senior JPMorgan executive said at the bank’s 2019 investor day on Tuesday. “We want to really use what is being developed (and build) on top of it.” “I don’t know if there is 10 per cent more (value), if there is 40 per cent more, what I do know is there

is no zero . . . We need to deliver a lot more for every dollar of expense in technology.” JPMorgan spends $10.8bn a year on technology, the highest figure disclosed by any Wall Street bank. Earlier in the day, chief financial officer Marianne Lake said the company does “not expect net incremental investments to be higher over the next couple of years”. JPMorgan’s shares fell around 1.5 per cent at what analysts described as a cautious tone in its 200 page slide deck and early commentary from its executives, who will be speaking until chief executive Jamie Dimon closes the conferences at around 2.30pm eastern time.

Ms Lake defended the bank’s decision to keep its return on tangible common equity target at 17 per cent, even though the bank is already earning that, arguing that while recessionary signs are “not flashing red . . . they are off the floor.” “There is a case to earn higher than that over the next year or two or maybe even longer,” she said. “(But) the further out you go the less confidence we can have that we won’t see the end of the (economic) cycle.” Referring to the sharp decline in fixed income revenues across Wall Street banks in recent years, Mr Pinto said: “it is a challenging business for the industry overall but not so much for us” since JPMorgan’s fixed income returns were “very high”.

Hong Kong court rejects short seller’s final appeal against controversial trading ban Andrew Left’s ban followed publication of a negative report on China’s Evergrande Don Weinland

Hong Kong court has shot down the final appeal of short seller Andrew Left against a ruling that banned him from trading in the city for five years after publishing a negative report on Chinese property developer Evergrande. The original report from Mr Left’s Citron Research in 2012 claimed that

Evergrande, one of China largest listed mainland property developers, was insolvent and that it had presented fraudulent information to investors. The report led Hong Kong’s Securities and Futures Commission to bring Mr Left before a markets misconduct tribunal, becoming the first case in which the securities regulator has pursued legal action against unregulated published commentary.

In 2016 the tribunal ruled that Mr Left had committed market misconduct, banning him for five years from trading in Hong Kong and ordering him to return profits from trading in Evergrande and pay costs. The appeal, launched in January, sought to overturn the ruling on the grounds of freedom of speech but the SFC said on Tuesday that the Court of Appeal had dismissed Mr Left’s appeal.

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ANALYSIS Women take more CEO roles at asset managers but gaps remain As LGIM appoints Scrimgeour, 3 of world’s top 15 asset managers run by women Owen Walker

Toronto tech: why Canada is attracting the ‘best’ people With Donald Trump making it harder to gain visas to the US, its neighbour is benefiting from a ‘brain gain’ Andrew Edgecliffe-Johnson

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obody calls it Maple Valley,” says Yung Wu. What about Silicon Valley North? No, that nickname hasn’t caught on either, he replies amiably: “We’re not Silicon Valley.” Toronto’s understated technology community has politely defied outsiders’ attempts to define its rapid growth in relation to California’s unmatched innovation engine. Yet veteran entrepreneurs such as Mr Wu admit to taking some pride in last year’s discovery that Canada’s largest city had created more tech jobs than San Francisco — or any other US metropolis — in the preceding five years. Its population of software developers, engineers and programmers grew by more than half between 2012 and 2017, according to CBRE, the commercial real estate firm. The 82,100 technology jobs it added over that period made it North America’s fastest-growing tech centre, CBRE calculated, to the surprise of many south of the border. Mr Wu, who runs a hub for start-ups called MaRS Discovery District on the site of Toronto General Hospital where the use of insulin was pioneered, sees several reasons for this “brain gain”, from the city’s relative affordability to the work being done on artificial intelligence at the University of Toronto. But he and many of the entrepreneurs on his bustling 1.5m sq ft campus credit one new factor with helping Toronto attract ambitious foreign tech workers who would once have headed for Silicon Valley by default: since the elections of Justin Trudeau in 2015 and Donald Trump in 2016, attitudes to immigration in Ottawa and Washington have diverged markedly. “There’s a chill going on south of the border,” says Toby Lennox, chief executive of Toronto Global, the group tasked with attracting foreign investment to North America’s fourth-largest city. “Right now we’re positioning ourselves to be a lot more welcoming.” America’s president has not threatened to build a wall along its northern border, but he has made it harder for even skilled foreigners to enter the US, where they could undercut the country’s homegrown workforce. In particular, his administration has tightened the requirements for granting H-1B visas and threatened to ban spouses of people on such permits from working. Up to 85,000 people enter the US each year under the H-1B programme, which was introduced to help bring in highly skilled talent but has often been accused of being misused by employers more interested in replacing US workers

with cheaper foreigners. Some US executives concede that reforms are needed but say Mr Trump’s actions and rhetoric have left white-collar employees who once assumed a US visa was almost a formality feeling insecure and facing unexplained delays. In a tight labour market, corporate America has stepped up its lobbying for a more open regime. The Business Roundtable, a group of chief executives from US companies including Apple and Cisco, warned last summer that the Trump administration’s “buy American and hire American” policies were resulting in “arbitrary and inconsistent” visa adjudications. Since then the BRT has called for an increase in the number of H-1Bs granted, more predictability in the way skilled workers’ visas are assessed and greater efforts to retain international students with top science, technology, engineering and mathematics degrees from US universities. The prescription has a distinctly Canadian ring to it. Canada already grants foreign students work permits for up to three years after graduation, and in June 2017 the country’s immigration and employment authorities launched what they called their Global Skills Strategy, with the goal of making it easier for employers to bring in highly skilled foreign workers. Among its promises was that work permits for such individuals (and their families) would be processed within two weeks, subject to police and medical checks. Within little more than a year, more than 12,000 people had applied, of whom 95 per cent had been accepted. Some had applied for H-1Bs and been turned down, says Irfhan Rawji, a Canadian venture capitalist who launched a nearshoring company called MobSquad last October to help US tech companies fill vacancies with people based in Canada. “We cannot build this country without skilled workers and we do not have enough of them,” he says. More than 200,000 people apply each year for the 85,000 H-1B visas the US offers, he notes. “So we knew there were 115,000 people who didn’t win the lottery who were willing to come to North America.” There is nothing new about Canada being receptive to immigration: some 51 per cent of Toronto’s residents were born in another country — more than New York’s 40 per cent. But the strategy has given a new tech focus to Canada’s immigration policy: the most common professions among those admitted were developers, computer analysts, university professors and software engineers. This is already having a tangible impact, according to Elissa Strome, executive director of the

$125m Pan-Canadian AI Strategy at CIFAR, a research institute based in the MaRS building. “I think where Canada has really benefited on immigration is the change in our own policy, not the change in US policy,” she says: “When I talk to CEOs, that speed of decision-making is what’s made the difference.” Toronto’s entrepreneurs say a tech-friendly immigration system is essential because there are some skills they simply cannot find locally. “It is hard to find enough people with experience of largescale consumer tech companies anywhere other than Silicon Valley,” says Ray Reddy, chief executive of Ritual, a food-ordering app for office workers picking up lunch from local restaurants. “We have to import them.” Ben Zifkin, chief executive of Hubba, is among the entrepreneurs to have taken advantage of the Global Skills Strategy. His online marketplace for small retailers is starting a recruitment programme in Tel Aviv to bring soldiers leaving the army to Toronto for a year. “If you want to come up here I will have you a visa in two weeks. The ability to say that was a pretty impactful thing,” he says. Among Toronto’s recent arrivals is Protik Das. He moved to the US from Bangladesh in 2012 to study aerospace engineering at Georgia Institute of Technology but the defence companies he met made clear that they were not interested in hiring non-Americans. He tried his own start-up but discovered that he could not apply for an H-1B visa while working for himself and would have to leave the US within a year of graduation unless he could find an employer in the field he had studied to sponsor him. So in September 2017 he moved to Canada, where he is now an engineer with a company applying digital technology to wound care. Bangladeshi friends who opted for Canadian universities were “way more relaxed about the situation”, he says, adding that he now advises younger Bangladeshis to choose Canada over the US “because you have more guarantees in Canada”. Mr Das struggles to understand why the US accepts bright foreigners to its universities, trains them and then lets them slip away. “Very talented people are spending a lot of money to come and study in the US,” he says. But the stress the country’s visa process induces means US companies “end up losing talent”, he argues. Canada’s more welcoming approach has not only helped pull in people from the other side of the world such as Mr Das, Hubba’s Mr Zifkin observes, it has also made it easier to attract Americans, and coax back Canadians working in the US.

egal & General Investment Management last year launched its Gender in Leadership (Girl) fund, which allocates a greater weight to UK companies led by women. Nine months on, Britain’s largest fund manager has put investment theory into practice by hiring its first female chief executive. Michelle Scrimgeour’s defection from rival Columbia Threadneedle, where she is head of Europe, means three of the world’s top 15 asset man-

hunter specialising in the investment industry. “It is getting better, but it is still nowhere near where it should be.” Ms Shah said while there was a handful of female chief executives with high profiles, very few senior women were asset managers in roles other than overseeing human resources or communications teams. Efforts to increase the number of women on boards had mostly centred on non-executive directors, she added. “There is just not the pipeline there,” she said. Hanneke Smits, chief executive of Newton Investment Manage-

agers are led by women. Ms Scrimgeour will replace Mark Zinkula as head of LGIM, one of the most powerful roles in European asset management. The business, which is a division of the UK insurer Legal & General, manages £985bn, mostly on behalf of British savers and pension scheme members. Among her peers are Abigail Johnson, chairman and chief executive of Fidelity Investments, the $2.5tn asset manager, and Mary Callahan Erdoes, chief executive of JPMorgan Asset & Wealth Management, which oversees $1.7tn of assets. Ms Johnson also chairs Fidelity’s sister company, Fidelity International, which recruited Anne Richards as chief executive from London-based manager M&G last year. Both Ms Scrimgeour and Ms Richards had been in place for just a couple of years before being poached by rivals. Bev Shah, chief executive of City Hive, which promotes diversity in financial services, said their short tenures reflected the small pool of female chief executives within asset management and the high demand for their services. She added some fund groups were prioritising hiring more women, especially in senior roles. “I’m constantly being contacted by recruiters saying they are looking for all-women or mainly women shortlists,” she said. Three of the four candidates on the shortlist prepared by Korn Ferry for the LGIM job were women. But while some of the largest managers have made efforts to recruit women bosses, there are still few examples among mid-size and boutique managers. Women are also relatively absent from other senior leadership roles and in positions carrying out fund companies’ main activity: managing money. “There is an undeniable shortage of women in executive management positions,” said Oli Templeton, director at Sheffield Haworth, a head-

ment, the fund manager owned by BNY Mellon, said ensuring a diverse range of candidates was insufficient — there also needed to be a diverse interview panel. She added that the UK government’s Hampton-Alexander review of corporate diversity had placed much more emphasis on the make-up of executive teams, not just boards. “That has been incredibly helpful and will lead to more diverse appointments down the road,” she added. Some well-known fund management businesses have senior women in their leadership teams, including Rachel Lord, head of Emea at BlackRock, the world’s biggest money manager, and Charlotte Jones, the chief financial officer at Jupiter. In an FT interview last summer, Ms Scrimgeour said her biggest career regret was never having run money. “Early on, I had an opportunity to do that. Could that have led to me doing something different? That might have given me another dimension. I’ve worked closely with fund managers throughout my career, so I don’t think it’s held me back,” she said. A lack of portfolio management experience is sometimes blamed as a factor in holding women back from rising too high within investment companies. Less than 5 per cent of investment funds are run by female managers, according to Morningstar. Fiona Frick, chief executive of Unigestion, the Swiss boutique group that manages $23bn, is one of the few female investment bosses who had previously run money. She said the main reason there were so few female portfolio managers was how tricky it was to fit the role around a family life. “We want investment managers to be close to the traders and other members of their team — it’s difficult to work flexible hours,” she said. “But that is no longer the only route to become chief executive.”

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Leadership

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Shaping people into a team

The Dalai Lama on why leaders should be mindful, selfless and compassionate

ver the past nearly 60 years, I have engaged with many leaders of governments, companies and other organizations, and I have observed how our societies have developed and changed. I am happy to share some of my observations in case others may benefit from what I have learned. Leaders, whatever field they work in, have a strong impact on people’s lives and on how the world develops. We should remember that we are visitors on this planet. We are here for 90 or 100 years at the most. During this time, we should work to leave the world a better place. What might a better world look like? I believe the answer is straightforward: A better world is one where people are happier. Why? Because all human beings want to be happy, and no one wants to suffer. Our desire for happiness is something we all have in common. But today, the world seems to be facing an emotional crisis. Rates of stress, anxiety and depression are higher than ever. The gap between rich and poor and between CEOs and employees is at a historic high. And the focus on turning a profit often overrules a commitment to people, the environment or society. I consider our tendency to see each other in terms of “us” and “them” as stemming from ignorance of our interdependence. As participants in the same global economy, we depend on each other, while changes in the climate and the global environment affect us all. What’s more, as human beings, we are physically, mentally and emotionally the same. Look at bees. They have no constitution, police or moral training, but they work together in order to survive. Though they may occasionally squabble, the

colony survives on the basis of cooperation. Human beings, on the other hand, have constitutions, complex legal systems and police forces; we have remarkable intelligence and a great capacity for love and affection. Yet, despite our many extraordinary qualities, we seem less able to cooperate. In organizations, people work closely together every day. But despite working together, many feel lonely and stressed. Even though we are social animals, there is a lack of responsibility toward each other. We need to ask ourselves what’s going wrong. I believe that our strong focus on material development and accumulating wealth has led us to neglect our basic human need for kindness and care. Reinstating a commitment to the oneness of humanity and altruism toward our brothers and sisters is fundamental for societies and organizations and their individuals to thrive in the long run. Every one of us has a responsibility to make this happen.

What can leaders do? BE MINDFUL Cultivate peace of mind. As human beings, we have a remarkable intelligence that allows us to analyze and plan for the future. We have language that enables us to communicate what we have understood to others. Since destructive emotions like anger and attachment cloud our ability to use our intelligence clearly, we need to tackle them. Fear and anxiety easily give way to anger and violence. The opposite of fear is trust, which, related to warmheartedness, boosts our self-confidence. Compassion also reduces fear, reflecting as it does a concern for others’ well-being. This, not money and power, is what really attracts friends. When we’re under the sway of anger or attachment, we’re limited in our ability to take a full and realistic view of the situation. When the mind is compassionate, it is calm and we’re able to

use our sense of reason practically, realistically and with determination. BE SELFLESS We are naturally driven by self-interest; it’s necessary to survive. But we need wise selfinterest that is generous and cooperative, taking others’ interests into account. Cooperation comes from friendship, friendship comes from trust and trust comes from kindheartedness. Once you have a genuine sense of concern for others, there’s no room for cheating, bullying or exploitation; instead, you can be honest, truthful and transparent in your conduct. BE COMPASSIONATE The ultimate source of a happy life is warmheartedness. Even animals display some sense of compassion. When it comes to human beings, compassion can be combined with intelligence. Through the application of reason, compassion can be extended to all 7 billion human beings. Destructive emotions

c 2017 Harvard Business School Publishing Corp. Distributed by The New York Times Syndicate

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are related to ignorance, while compassion is a constructive emotion related to intelligence. Consequently, it can be taught and learned. The source of a happy life is within us. Troublemakers in many parts of the world are often quite well-educated, so it is not just education that we need. What we need is to pay attention to inner values. The distinction between violence and nonviolence lies less in the nature of a particular action and more in the motivation behind the action. Actions motivated by anger and greed tend to be violent, whereas those motivated by compassion and concern for others are generally peaceful. We won’t bring about peace in the world merely by praying for it; we have to take steps to tackle the violence and corruption that disrupt peace. We can’t expect change if we don’t take action. Peace also means being undisturbed, free from danger. It relates to our mental attitude and whether we have a calm mind. What is crucial to realize is that, ultimately, peace of mind is within us; it requires that we develop a warm heart and use our intelligence. People often don’t realize that warmheartedness, compassion and love are actually factors for our survival. Buddhist tradition describes three styles of compassionate leadership: the trailblazer, who leads from the front, takes risks, and sets an example; the ferryman, who accompanies those in his care and shapes the ups and downs of the crossing; and the shepherd, who sees every one of his flock into safety before himself. Three styles, three approaches, but what they have in common is an all-encompassing concern for the welfare of those they lead.

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Wednesday 27 February 2019

& INNOVATION Nigeria lags as mobile-money accounts now surpass bank accounts in Africa

Endurance Okafor

Africa’s largest economy needed to see how the regulation of mobile money could evolve owning to significant volumes of currency that could be circulating in mobile wallets, and may not be visible to the regulatory authorities. As such it was clear that a better balance between the market and the regulatory structures was required. Meanwhile, since then there has been an explosion in mobile money wallet usage in Kenya and other Africa peers, the Nigeria’s CBN was rather focused on an independent bank led model that would supplement and support the existing banking system. B u s i n e s s D ay s u r v e y showed that the Telco-led model in driving financial inclusion in African countries reported tremendous progress owing to the already existing large customer base of the Telcos. Kenya has about 60 percent mobile money service penetration, while Ghana has about 40 percent service penetration, and Nigeria with a lot more population number, remains at 1 percent owing to its bank-led model. Ghana’s decision to have a Telco-led model resulted in a

73 percent increase in registered mobile money customers in just one year, according to World bank data, and has helped lift financial inclusion rates in Ghana to 58 percent in 2017 from 41 percent in 2014. This was not different for Ivory Coast who has experienced a mobile money revolution. As a result, there are now more adults with mobile money accounts of 24.3 percent than with bank accounts of 15 percent. “It is safe to say that Nigeria is playing catch-up when it comes to achieving inclusion and must look to learn from success stories like Ghana and Kenya if we are to achieve our goal of 80 percent inclusion by 2020,” said Gbenga Adebayo, Chairman of the Association of

Licensed Telecom Operators of Nigeria (ALTON) centered on Financial Inclusion. In its quest to ensure it meets the set 80 percent financial inclusion target by the year 2020, Nigeria’s apex bank on the 5th of October 2018, released an exposure draft guideline in which it proposed Payment Service Bank (PSBs), a payment service initiative which can allow Banking agents, Mobile Money Operators (MMOs), Retail chains (Supermarkets), Telecommunications companies (Telcos) to have license to operate under the structures and guideline specified by the bank. At least 30 business names are currently undergoing registration as payment service banks with the func-

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It is safe to say that Nigeria is playing catch-up when it comes to achieving inclusion and must look to learn from success stories like Ghana and Kenya if we are to achieve our goal of 80 percent inclusion by 2020

‘

hile mobile money is spurring financial inclusion in Africa as against the conventional bank accounts, Nigeria seems to be left behind as Africa’s largest economy is still in the process of giving license to Telecommunication companies to operate in the financial space. A recent publication by the International Monetary Fund (IMF) shows that there are more mobile money accounts in Africa than the conventional bank accounts. According to the Fund, the use of mobile money has grown exponentially over the past 10 years, making the region the global leader in mobile money innovation, adoption, and usage. “Mobile money accounts now surpass bank accounts in the region and greater financial inclusion has benefited large swathes of the population that remain unbanked including the poor, the young, and women,”Amadou Sy, an Advisor in the African Department of the IMF, said. Nigeria with the highest population in Africa has 36.8 million of its population excluded from the financial cycle, owing to its bank-led financial inclusion model. Between 2014 and 2017, the World Bank said there has been a significant increase in the use of mobile phones and the Internet to conduct financial transactions which contributed to a rise in the share of account owners sending or receiving payments digitally from 67 per cent to 76 per cent globally, while developing countries recorded 57 percent to 70 per cent. Mobile Money is a payment solution that enables people to pay for goods and services from their electronic wallet on their mobile phones without necessarily using the internet. As at the time Nigeria was considering the optimal approach needed to leverage new, innovative technology to deliver financial services to its people, the central bank analysed in some detail how to structure the guidelines and the regulatory environment to deliver the benefits on offer, without compromising the integrity of the financial system.

tions to: maintain savings accounts and accept deposits from individuals and small businesses, which shall be covered by the deposit insurance scheme; carry out payments and remittance (including cross-boarder personal remittance) services through various channels within Nigeria; issue debit and pre-paid cards, and operate electronic purse. Meanwhile, the Washington-based IMF explained in a statement that access to traditional banking services remains almost a mirage for most Africans, but the near-universal availability of mobile phones has allowed millions to access mobile money services. BusinessDay analysis of data from the Fund revealed that in sub-Saharan Africa, there are 5 commercial bank branches per 100,000 people, this is compared to the 73 mobile cellular subscription point per 100 people. “Sub-Saharan Africa is the only region in the world where close to 10 percent of GDP in transactions occur through mobile money. This compares with just 7 percent of GDP in Asia and less than 2 percent of GDP in other regions,” the Fund noted. According to figures by Nigerian Communications Commission (NCC), the country’s telecommunications industry has a reach of 86 percent of the country, with 162.3 million customers (the single largest customer base of any industry in Nigeria). This makes the industry till date, one of the most thriving sectors in the country and analysts have disclosed that it has the capabilities, including technology, infrastructure, distribution network and subscriber base. Meanwhile, Nigeria’s Telcos industry players have a combined presence in 774 local government areas across the country further emphasising their ability to reach especially hard-to-reach areas of the country. The communication service providing companies in Nigeria also have about 1,000,000 unique agents already in place selling airtime across the country, and analysts say this can quickly be converted to establish mobile money agent networks which can help reach out to the unbanked Nigerians especially those in the rural areas. According to London based Group Special Mobile Association (GSMA), “from

a regulatory perspective, one basic requirement for mobile money to succeed is to create an open and level playing field that includes non-bank mobile money providers such as Mobile Network Operators (MNOs).” Yewande Adewusi, a Lagos-based financial inclusion consultant said there are different schools of thought on how mobile money should work in Nigeria due to our peculiar challenges but if we are looking at how to maintain monetary system stability or still maintain financial inclusion with the right oversight then the banks and Telcos should work together to drive it. “We don’t know what models work in Nigeria. A lot of factors make mobile money difficult to work in Nigeria, for example there are some rural areas that don’t have Telcos network so even if Telcos drive mobile money, there will still be problem of availability,” Adewusi told BusinessDay. Adewusi explained that Nigeria is a huge market and it is very obvious that what the country has been doing in the past is not working. “However, moving forward it should be a combination of Telcos working together with banks or we should allow the Telcos have their own licenses which will be regulated through Special Purpose Vehicle (SPV) by CBN.” “The fundamental obstacle to the rapid expansion of financial inclusion in Nigeria is the failure of the private sector actors in the telecoms and financial services ecosystem to collaborate effectively,” an analyst said in a statement. Umar Garbar Danbatta, Executive Vice Chairman of NCC told BusinessDay last year that security challenges on the telecommunications infrastructure in Nigeria were a contributing factor in holding back the licensing of Telco’s for mobile money services Nurudeen Zauro, the Technical Adviser, Financial Inclusion Secretarial at the Central Bank of Nigeria also told BusinessDay recently that “most probably by the end of the first quarter of 2019 we’ll roll out PSBs.” “We did not want a situation whereby there is no proper regulation of the industry but I can tell you now that everything is in place,” Zauro said.

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Somalia: Planned oil search under threat Page 50 GAS

Egypt: Egypt to remain the low-cost option for East-Med LNG exports

Page 51

L-R: Stephen Odili, operations lead, Enyo Retail; Abimbola Alli, human resource lead; Abayomi Awobokun, chief executive officer, Enyo Retail; Olabanjo Alimi, sales and marketing lead, Enyo Retail at the Media Roundtable held at the Enyo Retail and Supply Limited station in Lekki recently.

Debrief

Can Nigeria withstand rising onslaught from US crude export?

Market Insight

FRANK UZUEGBUNAM

Oil near 2019 highs amid OPEC cuts, sanctions on Iran, Venezuela

Page 55

OPEC weekly basket price DAY

PRICE

22/2/19

66.56

21/2/19

66.50

20/2/19

65.97

19/2/19

65.79

18/2/19

66.03 Source: OPEC

fter losing the US market as one of its major destinations for its crude oil export, Nigeria might be up for a big fight for its Asian market share as a result of rising US exports into Asia in the past few months. Higher transport costs to Asia would have required big discounts from US to capture a market share but a drop in freight rates contributed in making US cargoes more competitive. Freight costs from the US Gulf Coast to Asia have fallen by about a third since early December 2018, making the case for greater loadings of US crude to the region. Freight from West

Africa to Asia have increased recently, making it currently about 70 cents/b more expensive to bring Nigerian crude to the market. Shipping reports for January 2019 loading cargoes reveal that 16 VLCCs were seen carrying US crude from the US Gulf Coast to Asian destinations. Around 17 VLCCs have been fixed to load crude from the US Gulf Coast to Eastern destinations for February-loading cargoes, shipping reports showed, with many more likely booked outside of reported fixtures. “There is the potential for Q2 2019 US crude exports to Asia to be higher year-on-year if the WTI/Brent spread remains in the range it has in recent months and with the lower freight rates,” said David Arno, oil analyst at

analytics firm Offers for US crude arriving in Asia in the second-half of March or April are about 50 cents a barrel lower than a month earlier, market sources said, making it more competitive against crude oil from West Africa. Nigeria’s Qua Iboe was last valued at a premium of around $1.85 to dated Brent. Nigerian crude has had a difficult time clearing for several weeks, as offer levels were too high to attract buying interest from European refineries which have been suffering from poor refinery margins on naphtha and gasoline. Since its crude export ban was lifted in 2015, US is becoming a major player in global crude markets. Industry sources indicated that US crudes

continued to attract the attention of plenty of Asian buyers directly competing against Nigeria’s light sweet crude. Most European countries; United Kingdom, Netherlands, Italy, France, and Spain, which used to be Nigeria’s export destinations, are now taking crude oil from the US. It will be recalled that Nigeria saw a significant reduction in US imports of its crude from 2012, following the shale oil production boom. US crude oil import from Nigeria fell from 40 million barrels in 2007 to less the 6.17 million barrels in June 2013 barely a year after the advent of the shale oil boom. In October 2017, the export of Nigerian crude to US rose by 56 percent to 13.67 million barrels from the 2013 levels.

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The auction that took place in London on February 7 has re-ignited a long-standing maritime dispute between the two countries and, which is pending the International Court of Justice. “This unparalleled affront and illegal grab at the resources of Kenya will not go unanswered and is tantamount to an act of aggression against the people of Kenya and their resources,” said Kenya’s Ministry of Foreign Affairs in a statement. “This outrageous and provocative auction deserves and will be met with a unanimous and resounding rejection by

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Somalia: Planned oil search under threat omalia has big plans for auctioning some of its offshore blocks in 2019 but the recurring maritime boundary dispute with her neighbor to the west, Kenya, needs to be conclusively resolved if the expected licensing round is to register progress. Kenya has claimed some of its offshore oil and gas on the Indian Ocean have been auctioned by Somalia to “the highest predatory bidders from the United Kingdom, Northern Ireland and Norway among others.”

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all Kenyans as well as all people of goodwill who believe in the maintenance of international law and order and the peaceful and legal resolution of disputes,” said Monica Juma, Kenya’s head of Ministry of Foreign Affairs. “Kenya has willingly and procedurally enjoined itself to the international legal processes of international boundary disputes, including but not limited to, bilateral negotiations and subservience to the International Court of Justice where this matter of the Kenya/Somalia boundary currently

rests,” the ministry said in the strong-worded statement. Somalia looks determined to exploit her hydrocarbons resources taking advantage of the country’s strategic location and the fact that it has one of the biggest offshore coastline in Africa. “The licensing of offshore Somalia is strategic, very big and out into the sea and there should be no concerns about security,” said Karar Doomey, Somalia’s Director General in Ministry of Petroleum and Mineral Resources. “The government is working very hard and there is now less corruption, we have done well with the fiscal regime as well as the Petroleum Bill and also the Investment Bill,” he said. “Somali is thought to be the pot where all the oil is cooked and the gas is just around so we hope investors will find that attractive and also our production sharing contract model is quite good as well as the investment laws,” added Doomey.

Brief Libya: Eastern Libyan military forces claim control of El Feel oilfield

astern-based Libyan military forces took control of the southwestern El Feel oilfield, their spokesman and a field engineer said. Production was unaffected and continuing in the range of 75,000 barrels a day, the usual level, the engineer said, asking not to be named. He denied local media reports that there had been fighting inside the field located deep in Libya’s south. State oil firm National Oil Corp (NOC), which operates the field in a joint venture with Italy’s Eni, “is concerned about the developments near El Feel oilfield and is monitoring the situation closely to ensure the safety of its staff,” an NOC representative said. Forces loyal to commander Khalifa Haftar have waged an offensive in Libya’s south since last month. Haftar’s Libyan National Army (LNA) posted a video purporting to show their vehicles driving into El Feel. Separately, LNA spokesman Ahmed Mismari said his forces had allowed planes of oil firms bound for El Feel and the nearby El Sharara oilfield to resume

flights. The LNA this month imposed a ban on any flights without its permission and carried out air strikes near El Feel after a plane arrived carrying a rival commander from Tripoli, home to the UNrecognised government. Haftar backs a rival administration based in the east. The LNA recently secured the El Sharara oilfield located also in the south by cooperating with state guards which had occupied it in December to press officials into financial demands. NOC has not reopened El Sharara yet, demanding guarantees for its workers. This week it sent an inspection team by road to assess the security, but no results have been made public yet. El Sharara produced around 315,000 barrels per day until it got closed.

Uganda: Tullow Oil confirms output targets; upbeat on Uganda after tax deal

K-based independent Tullow Oil confirmed plans to grow its output by around 10 percent this year and remained upbeat on the progress of its key oil development in East Africa following a tax deal in Uganda. Reporting full-year earnings, Tullow said its 2019 production guidance is unchanged at 94,000-102,000 b/d of oil equivalent with growth driven by new wells in Ghana, its core West African production base. Further drilling at the TEN fields offshore Ghana will see gross production from the asset rise

to an average of 83,000 b/d this year, with net production to Tullow of 39,000 b/d, up from 64,500 b/d and 30,400 b/d respectively in 2018, Tullow said. Gross oil production from the troubled Jubilee field is expected to rise to 96,000 b/d from 78,000 b/d last year, with net production to Tullow 34,000 b/d in 2019. In East Africa, Tullow said it has now agreed the terms of a capital gains tax bill covering its $900 million Uganda asset farmdown to CNOOC and Total in 2017. The long-awaited deal allows the farm-down to complete and helps clears

the path to the project partners taking a final investment decision on the development in mid2019, Tullow said. Led by Total, the partners are hoping to bring the first oil from the 1.7 billion barrels of discovered resources in Uganda to the market in 2022. In Kenya, Tullow said it continues to target bringing the first oil export cargo from its Turkana development to the market in mid-2019 after boosting trucked exports to the coast to 2,000 b/d from April. So far, over 70,000 barrels of oil have been transported to Mombasa to build the maiden export cargo.

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Shell sign interim upstream gas deal with Oman

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upermajor Shell and Oman have signed an interim deal to develop gas acreage in block 6 in 2019, according to a statement from Shell. The agreement covers investments in oil and gas and resources are to be used for domestic Omani projects. Petroleum Development Oman, Oman Oil Company and Total also signed the deal as partners. The deal will integrate Shell and Oman Oil’s upstream project with a planned gas-to-liquids plant that Shell and Oman Oil will also co-develop. Shell last year signed a memorandum of understanding with the Omani government to develop a GTL plant in Duqm.

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“We hope that the development of gas resources destined for the integrated projects will play an important role in generating in-country value and diversifying Oman’s economy,” Chris Breeze, chairman of Shell in Oman said. Oman’s gas resources are rapidly depleting and new resources will need to be exploited to meet rising domestic electricity demand. Oman in January signed new exploration and production deals with BP and Eni to shore up fresh reserves. At the moment, Oman is a gas exporter and sells domestic resources through its Oman LNG export arm. But it has also mulled plans to import the fuel.

Egypt: Egypt to remain the low-cost option for East-Med LNG exports

gypt’s Idku and Damietta LNG export plants are likely to remain the lowcost option for East Mediterranean gas producers looking to export, and the process of starting up supplies through Egypt from around the region is one of “normal project development,” Gasser Hanter, Shell country chair and vice president said. Hanter played down the idea of any remaining political obstacles to bringing supplies to Egypt from countries such as Cyprus or Israel. He pointed to Egypt’s hosting of an East Mediterranean Gas Forum in January that brought together governmental representatives from the region, and recent commercial agreements. “I think we are in the normal project development stage. We have seen that the geopolitical piece, we have seen it with the inter-governmental agreements, and we have recently seen the East Mediterranean Gas Forum, where you had all the countries from the East Mediterranean. You just have to go through the normal project development process,” Hanter told journalists at the EGYPS conference in Cairo. In recent months Israel

has agreed to begin pipeline exports to Egypt, and Cyprus has reached a provisional deal to pipe gas from its Aphrodite field to Egypt. Egypt’s Dolphinus Holdings is set to import 64 Bcm/year of gas from Israel over a 10-year period, with supplies sourced from the Tamar and Leviathan fields, after producers Noble Energy and Delek agreed to buy a stake in the idled East Mediterranean Gas pipeline. Hanter said the economics of Egypt’s export plants remained compelling, suggesting any other future liquefaction proj-

ects in the region might struggle. Partly, this was because the Egyptian plants had been built in a different commercial environment, and costs had since risen, he said. “If you want to build something similar to that today, you’re looking at a large number of billions of dollars,” Hanter said. “In my mind it is a question of can you build it cheaper in Cyprus or elsewhere, or is it better for you to transport it and not build? I think everything is possible. I still think that having these advantaged plants that were built in the good

old days with very experienced operators behind it, the very solid infrastructure, the gas market at the back of the pipe, these are all ingredients that are quite important,” Hanter said. Yuval Steinitz, Israeli energy minister held bilateral talks in Cairo in January with his Egyptian counterpart Tariq al-Mulla on his first visit to Egypt since the Arab Spring in 2011. He described the invitation as “further proof that the benefit of developing gas resources is not only economic and environmentally beneficial, but also geopolitical and political in nature.”

Ethiopia and Djibouti sign deal to build gas pipeline

thiopia and Djibouti have signed a deal to build a pipeline to transport Ethiopian gas to an export terminal in the Red Sea state, officials said. Ethiopia found extensive gas deposits in its eastern Ogaden Basin in the 1970s. China’s POLYGCL Petroleum Investments has been developing the Calub and Hilala fields there since signing a production sharing deal with Ethiopia in 2013. The agreement between Djibouti and Ethiopia comes more than a year after POLY-GCL signed a memorandum

of understanding with Djibouti to invest $4 billion to build the natural gas pipeline, a liquefaction plant and an export terminal to be located in Damerjog, near the country’s border with Somalia. It was envisaged that production would start last year, but the Ethiopian government said that was now likely to happen in 2020. Yonis Ali Guedi, Djibouti’s Energy Minister said the deal hammered out “key terms that will serve as a basis” for related concession contracts. “It is the most expensive project ever built in

the Horn of Africa region,” he said. “The two parties have reached an agreement in principle to allow them to benefit from the project in an equitable manner.” POLY-GCL is a joint venture between stateowned China POLY Group Corporation and privately owned Hong Kong-based Golden Concord Group. Africa’s eastern seaboard could soon become a major global producer of liquefied natural gas, with other planned projects based on big gas finds made in Tanzania and Mozambique.

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that Ghana Gas plant and its associated pipeline infrastructure are currently manned by Ghanaian engineers, after the Chinese from SINOPEC who were managing the plant left. The takeover of the plant by Ghanaian engineers is saving Ghana about US$3 million monthly, resulting to a savings of about US$60 million since April 2017

adding that the first major maintenance shutdown, which was done between February and April 2018, was also done by staff of Ghana Gas Company. This, he said, enabled ENI to tie-in its pipeline at Sanzule. Owusu Bempah noted that the implementation of Risk Based Process Safety Management has helped to improve safety

Wednesday 27 February 2019

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Ghana: Atuabo Gas utilization for power production saves Ghana $206m hana’s decision to use processed gas from the Atuabo Gas Processing Plant, in the Western Region, for power generation in place of Light Crude Oil (LCO) has yielded an average savings of about US$42.6 million in 2017 and about US $206.4 million in early 2018, Ghana National Gas Company has revealed. The rise in savings in 2018 was due to a 43 percent increase in the price of LCO at 84.7/barrel from US$59.3/barrel in 2017. Since Ghana Gas began commercial operations in 2015, LPG from Atuabo Gas Processing Plant has, on average, accounted for 32 percent of national domestic consumption. The year-on-year analysis (2015-2018) shows that Ghana Gas supplied 40 percent of domestic LPG demand in 2017, the highest since the commissioning and commercial operations, thereby, reducing LPG import bill by US$47million. In 2018, the LPG supply declined by 2percent relative to the 2017 performance due to gas substitution from ENISankofa. Ernest Kofi Owusu Bempah, Head of Corporate Communications at the Ghana Gas, explained

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in the company which resulted that there has not been any incident in the company. “We also developed and implemented key HSE risks control procedures including the Management of Change Procedure in controlling HSE risk associated with changes and modifications to existing facilities,” he said.

Germany to close coal-fired power plants by 2038

ermany has announced its intentions of closing all of its coal-fired power plants by 2038 as renewables becomes the leading energy source, according to GlobalData. GlobalData Power analyst, Mohit Prasad, offers his view on the impact of this decision on the country’s power market. “Germany has closed 12 out of 19 nuclear power plants till date meaning the country must rely on renewable energy to provide 65 to 80 percent of their power by 2040; however currently it accounts for 41 percent of the country’s electricity, overtaking coal as the leading source of energy. Prasad noted that the country will require investment of around $45 billion to mitigate its dependence on coal fired plants which accounts for 40 percent of Germany’s electricity production. The coal-fired plants account for more than 25 percent of Germany’s CO2 emissions which is more than that of the Netherlands and Austria combined, he pointed out. “Germany has the largest fleet of coal-fired plants in Europe, making the phase out process more significant,” he said. Prasad continued: “The panel recommended a mutual agreement with the operators on a contractual basis with regard to the shutdown which would also include the size of compensation.

The compensation would be applied to plants in operation and those that have not yet entered service and still being built. “The compensation should depend on the ownership structure, linkages with mines, CO2 emissions by the plant and the respective number of affected employees. Compensation for companies and consumers paying more for electricity due to the phase out is estimated at €2 billion a year, with the exact amount to be set in 2023.” “The commission also recommended the utilities to scrap plans to clear the last 250 acres of the Hambach Forest, west of Cologne, for a lignite open pit mine. Apart from that, easing of regulation on construction of new gas fired plants which could replace the coal fired plants at the same location has also been recommended by the panel. “In providing the recommendations, the panel worked towards Germany’s existing climate goals to cut the greenhouse gas emissions of 55-56 percent below the 1990 by 2030. This is within the EU goal to cut emissions by at least 40 percent below the 1990 levels by 2030.

Egypt: Egypt to share energy practices with EAPP countries

gypt’s energy minister Mohamed Shaker has affirmed the country’s commitment to working with the East Africa Power Pool (EAPP) countries in advancing their goals in the energy sector. Among the goals is to achieve the goals of the 2063 Agenda, reports Egypt Today. Shaker expressed Egypt’s desire to share its experiences and its best practices in all fields of energy including rural electrification, renewable energy, improv-

ing energy efficiency and planning electricity projects, implementing them with all African countries. The minister said that

Egypt looks forward to hosting the next ministerial meeting of the EAPP. During the ministerial meeting, Shaker pointed out to the important role

played by electricity linkage projects in achieving development in EAPP member states. Sharing on some of the achievements in the last

four years, the minister noted that Egyptian energy sector succeeded in adding 25,000MW to the national power grid. Shaker also revealed

that Egypt has signed a memorandum of understanding and a cooperation agreement with the Global Energy Interconnection Development and Cooperation (GEIDCO), making a member of the organisation. Under the agreement, Egypt and GEIDCO will collaborate in a number of fields including conducting research on energy strategy in Egypt, strengthening development of using renewable energy and electric networks integration, and technical consultation on smart grid applications.

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Equinor’s 29 percent gas sales’ increase rides on de-carbonisation drive STEPHEN ONYEKWELU

quinor has said its 2018 sales of natural gas totalled $26 billion, an increase of 29 percent from 2017. The Norwegian energy giant sees strong market opportunities for both natural and liquefied natural gas and expects global demand to grow by approximately 10 percent as more countries prepare for the energy transition and de-carbonisation. Equinor sold a total of 100 billion cubic metres (bcm) of gas worldwide in 2018. It is the largest producer of natural gas on the Norwegian Continental Shelf (NCS) and the secondlargest gas supplier to Europe after Russia. Equinor pointed to “a welldeveloped and efficient gas infrastructure and proximity to the market” as the main reasons for Norway’s success in the gas market, with the United Kingdom and Germany being the largest export markets. “Global energy markets are changing. The world needs

more energy, but lower emissions. Natural gas is well positioned to provide secure, competitive and sustainable energy to consumers and industry” said Irene Rummelhoff, Equinor’s executive vice president for marketing, midstream and processing. In an energy scenario consistent with the 2-degree climate target, global gas demand would only be slightly lower than today even in 2050. That entails massive needs for investment in future gas supply in the decades to come. Equinor is actively exploring for gas on the Norwegian continental shelf. Rummelhoff said the company is committed to reducing CO2 emissions by 50 percent when replacing coal, providing needed back-up to renewables and offering a long-term solution for the low carbon future if converted to hydrogen. The European Commission recently initiated a move to open up Europe’s natural gas market, in order avoid being dependent on a single dominant supplier, a position Russia has occupied. This comes at a

time when Germany is simultaneously seeking to phase out nuclear power, leaving a further gap for gas to fill. Three weeks ago, critics of Nord Stream 2 picked up backing from the European Commission, the EU’s executive arm, which said the bloc, needs

to become less dependent on Russian gas and which proposed the revised pipeline legislation in late 2017. In addition to its own gas volumes, Equinor markets and sells the volumes of the Norwegian state’s direct financial interests (SDFI). In total, Nor-

Snapshot

We are also encouraged by the policy signals from Germany on the role of gas in phasing out coal and look forward to continue working with our partners across Europe to realise the full potential of the energy transition

wegian gas provides about 25 percent of Europe’s gas. “The UK has successfully reduced its CO2 emissions by more than one third, to levels since the late 19th century, using gas, renewables and other measures. We are also encouraged by the policy signals from Germany on the role of gas in phasing out coal and look forward to continue working with our partners across Europe to realise the full potential of the energy transition,” Rummelhoff said. Changing markets have also introduced new commercial opportunities on the trading side. As more liquefied natural gas (LNG) and intermittent renewables enter the market, Equinor is preparing to capitalise on increased price volatility. “The traded gas markets are developing rapidly and a key to success will be agility and ability to respond quickly to price fluctuations. The demand for shorter dated indices is increasing and our response is to reflect this development in our trading,” said Tor Martin Anfinnsen, Equinor’s senior vice president for marketing and trading.

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Brief Equinor changes gas trading strategy in volatile markets

quinor is changing its gas trading strategy to focus more on short-term price indexes, the company said, as increased supplies of liquefied natural gas and renewables growth are making European gas markets more volatile. “We are changing our gas strategy, we are moving more towards shorter indexes, we will have more active management in the way we market our

gas,” the state-controlled company said. “With more LNG coming into Europe and more and more renewables, we are seeing more volatility in the gas markets,” the company said in a presentation. Norway supplies about 25 percent of Europe’s natural gas, second only

to Russia, while Equinor markets around 70 percent of total gas sales from the Norwegian continental shelf, including volumes owned directly by the Norwegian state. Tor Martin Anfinnsen, Equinor’s head of marketing, told a gas seminar in London the company planned to tilt its gas sales towards day-ahead and month-ahead contracts towards 2020, as demand for longer-term contracts was fading away. He did not elaborate. He said Equinor had “high ambitions” for its energy trading business after acquiring Danish trader Danske Commodities for 400 million euros last year. The company also said gas flows are now more affected by geopolitical risks due to the growth of LNG. But the current trade spat between the US and China, a major LNG consumer, had a very marginal impact on LNG trade so far. “The growth in LNG means that gas flows become more exposed to geopolitical risks that traditionally had only affected the oil markets,” Equinor’s Chief Economist Eirik Waerness said.

Tullow Ghana deepens its local content agenda through mentorship program

ullow Ghana is intensifying its priority on local content in the upstream oil and gas sector. The oil firm in its maiden HR mentoring program graduated 24 Human Resource professionals in a high impact capacity building project. The Program Director, HR and Business Services at Tullow Ghana, Irene Asare said they will be investing heavily in human

resource to ensure Ghanaians could take up roles expatriates occupy. “A major part of our legacy as professionals is to contribute to the development of the capacities of those who bear the mantle and carry on after us. The opportunity to not only impart knowledge but also to acquire the same is an important part in the development of every human being whether personally or profession-

ally,” she stated. Being partners to the mentorship program, Edward Kwarpong, president of the Institute of Human Resource Management Practitioners (IHRMP), also expressed confidence in the initiative. “We recognize the significance of mentoring in achieving positive career and personal development, this the institutionalization of this allimportant HR mentoring

program. We need more of such programs to make HR professionals highly specialized,” he stated. Kweku Awotwi, Managing Director of Tullow Ghana Ltd, congratulated all mentees who graduated from the Mentoring Programme. “This program finds expression in Tullow’s support to Ghana’s education system and human resource management,” Awotwi said.

Aramco picks banks for debut international bond

audi Aramco IPO has selected banks to arrange its first international debt sale, which will help it finance the acquisition of a stake in Saudi Arabian Basic Industries Corp (SABIC), sources familiar with the matter said. The state oil giant has picked a group of banks including JPMorgan, Morgan Stanley, Citi, HSBC and Saudi Arabia’s National Commercial Bank, the sources said. JPMorgan and Morgan Stanley have been appointed joint global coordinators and, together with the other banks, joint bookrunners, said one of the sources. Aramco, the world’s top oil producer, plans to issue its first international bonds in the second quarter of 2019, likely worth about $10 billion, Saudi

Energy Minister Khalid al-Falih said last month. Sources said the oil giant could borrow as much as $50 billion from international investors to fund the purchase of all, or nearly all, of the 70 percent stake in SABIC held by the Public Investment Fund, the kingdom’s top sovereign wealth fund. Based on the type of fees banks gained on previous bond deals issued in the Gulf, fees could go up to roughly $1 million for each bookrunner, should the Aramco bond be in the vicinity of $10 billion. But banks have pitched hard over the past few months for this high-profile bond mandate, not so much for the fees, but in the hope of being rewarded by Aramco with future mandates for capital markets

transactions and other banking business such as foreign exchange and investment services. JPMorgan and Morgan Stanley, along with other banks, were working on the planned stock market listing of Aramco before the move was put on hold. The new planned listing date is 2021, Saudi officials have said. An international bond sale by Aramco will almost certainly require the company to obtain a credit rating and disclose financial information in a prospectus. Aramco has so far been reluctant to disclose many details of its finances. Concern about disclosure requirements was one reason that Aramco shelved the plan for a public offer of its shares last year. Chief Executive Amin

Nasser said last month that Aramco was talking to credit rating agencies ahead of its debut on the international capital mar-

kets. Aramco expects to match the ratings of Exxon and Shell, a source familiar with the matter

said, but bond market investors expect Aramco to have a similar, if not lower, rating than Saudi Arabia.

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ezuela. “Although there is no lack of resources, there is an increasing lack of access to them,” Britain’s Barclays bank said of the sanctions. The main factor keeping oil prices from rising even further is soaring US oil production, which rose by more than 2 million bpd

last year, to a record 11.9 million bpd. The swelling output has resulted in rising US oil inventories. US crude oil stocks rose by 1.3 million barrels in the week to February 15 to 448.5 million, according to a weekly report by the American Petroleum Institute.

European Commission seeks input on challenging US dollar hold on EU oil, gas trade

he European Commission is seeking views on how to encourage new euro-denominated price benchmarks for crude oil and global gas as part of efforts to break the US dollar grip on EU energy trading. The EU spent around Eur300 billion/year ($338 billion) on average on energy imports over the last five years, and around 85 percent, worth $287 billion, of this was paid in US dollars, according to the EC. This dependence on US dollars leaves European companies vulnerable to US foreign policy-related financial sanctions, for example over Iran, where US and EU sanction policies have diverged. The EC is seeking views on what would be needed to set up a euro-denominated benchmark “in the globalizing gas market” at European, national and price-reporting agency level. It is also interested to know what price-reporting agencies would need to

launch euro-denominated price benchmarks for crude oil. It is interested in the po-

ENERGY intelligence

OPEC as well as some non-affiliated producers such as Russia agreed late last year to cut output by 1.2 million barrels per day (bpd) to prevent a large supply overhang from growing. Another price driver has been US sanctions against oil exporters Iran and Ven-

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Oil near 2019 highs amid OPEC cuts, sanctions on Iran, Venezuela il prices hovered just below 2019 highs, bolstered by OPEC-led supply cuts and US sanctions on Venezuela and Iran. US West Texas Intermediate (WTI) crude oil futures were at $57.30 per barrel, up 14 cents, or 0.2 percent, from their last settlement and not far off their 2019 high of $57.55 reached. International Brent crude futures had yet to trade, but also hit a 2019 peak the day before, at $67.38 per barrel. Hopes that talks between Washington and Beijing would soon resolve the trade disputes between the world’s biggest economies also supported markets. Prices have been driven up this year by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC).

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tential opportunities, challenges and ways to overcome the latter. Other questions include

how to promote using the euro more in gas exploration, production, supply agreements, infrastructure projects and transportation. They also ask what would be needed for commodity exchanges to develop more euro-denominated derivative contracts on crude oil and refined products, again at European, national and commodity exchange level. The EC is also interested in how national governments could promote using euros more in energy trading, and also include model clauses in their intergovernmental energy agreements with non-EU countries saying that the euro is the default currency to use. The EC’s online consultation is open until March 31, and is targeted at national governments, central oil stock holding entities, energy market players, price reporting agencies, commodity exchanges, and European companies providing financial services to the energy sector.

OPEC Flakes Saudi Arabia seeks stronger commitment from Nigeria on OPEC oil cuts

audi Arabia has demanded greater adherence to oil production cuts by Nigeria in a bid to balance global oil markets and shore up prices. The kingdom had sent Ahmad Qattan, Minister of State for African Affairs and Special Envoy of King Salman Bin Abdulaziz to Abuja to meet with Nigeria’s President Muhammadu Buhari, to press Nigeria on compliance with the current OPEC/non-OPEC agreement. Buhari said he assured the Saudi envoy that even though it was a difficult decision for Nigeria to cut output, it would cooperate and step up its compliance to the cuts. Buhari said Nigeria, which is still struggling to get its oil production back to levels of 2.2 million b/d, would wish that there was no need for output cuts but acknowledged there was need to support oil prices. Saudi Arabia’s energy minister Khalid al-Falih had said that Saudi Arabia had received pledges of commitment from OPEC members whose production was still above their quota under the latest production

cut deal, which came into effect from January 1. “I have been speaking to many ministers and those who have been slow in achieving their targets in January have all committed to getting quickly into position to meet their commitment through six months,” Falih added. Nigeria’s compliance with the cuts has started off on a weak note. Africa’s largest crude producer pumped 1.79 million b/d in January, according to an average of the six secondary sources that OPEC uses to gauge production. This is well above its quota of 1.69 million b/d. Ministry officials insist some of the country’s crude should be categorized as condensate, which is not subject to production limits.

OPEC members, producer allies all ‘committed’ to cut oil output deal

PEC kingpin Saudi Arabia has received pledges of commitment from OPEC members and the group’s oil producer allies to cut production levels in line with their current output agreement, Saudi Arabia’s energy minister Khalid al-Falih said. Compliance by some key producers to the cut commitment, agreed to run between January and June, have been “unquestionable,” he said. “I have been speaking to many ministers and those who have been slow in achieving their targets in January have all committed to getting quickly into position to meet their commitment through six months,” Falih said. Saudi Arabia was a driving force behind the forging of the latest 1.2 million b/d output cut agreement aimed at shoring up oil prices, which plunged from $86/b in October to $50/b at the

end of 2018. Falih’s comments come a week after OPEC Secretary General Mohammad Barkindo urged members of the producer group and its 10 allies “to remain firm in achieving” their output cut goals. Barkindo’s statement came after reports of a lack of compliance

with targets by some producers, notably Russia, Iraq and Nigeria. OPEC’s research division estimates its 14 members pumped 30.81 million b/d in January, down nearly 800,000 b/d from 31.60 million b/d in December.

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Wednesday 27 February 2019

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ENERGY intelligence

The eligible customer policy - Why we have not seen the benefits IDOWU OYEBANJO

n May 2017, the Minister of Power exercised his rights as enshrined in the Electric Power Sector Reform Act (EPSRA) 2005 to declare classes of eligible customers within the Nigerian Electricity Supply Industry (NESI) to, among other benefits, unlock stranded generation capacity estimated to be above 2GW and breath financial life into the illiquid NESI. Almost 2 years after, such a very good policy that could have moved NESI in the right direction is yet to take off. It is therefore pertinent to examine the underlying reasons why the policy is yet to translate into the anticipated dividends. All stakeholders in the NESI agree that the Eligible Customer (EC) regulation will drive the NESI into full competition and improve the economy with industrial and commercial entities having incremental quantum of electricity supply. Yet, of a total number of 44 organizations that have so far expressed interest in becoming ECs, only 14 have submitted their applications to the approving authority, the Nigerian Electricity Regulatory Commission (NERC). More worryingly, none of these applications have been successful. The low level of success is not due to any inefficiency in NERC but the inability of applicants to satisfy the requirements of the application process. A major requirement for the successful application is the letter of non- indebtedness to be issued by the Distribution Company (DisCo) to which the applicant customer had been hitherto connected prior to switching into the EC

category. The Letter will be giving to the EC to absolve it of any debt, thus qualifying to switch customer classes. As expected in our clime, the DisCos have withheld this letter. To be honest, no one will agree to personally signing away the major source of his or income. This effectively is what the regulation is asking the DisCos to do. The so called cherry picking of customers is the bane of the successful implementation of the EC policy. Although the regulation provides for the Competition Transition Charges (CTC) to help DisCos cope with the realistic loss of revenue as a result of the implementation of the policy, the exact details of the CTC is yet to be worked out. DisCos have experienced a lot of disappointments having signed performance agreements based on promises which have not been kept by other parties and are thus reluctant to go head-on with the EC policy and get their fingers burnt again. This has the potential financial implications for the DisCos that are already financially bankrupt. Applicants also have to comply with technical, legal, commercial and safety requirements including registration with the Corporate Affairs Commission (CAC), signing of Market Participation Agreement (MPA), Power Purchase Agreement (PPA), Transmission Use of System (TUOS) Agreement, Distribution Use of System (DUOS) Agreement, and providing letters of credit from their Banks. Whereas NERC is endeavouring to simplify the application process, obtaining Bank guarantees is very difficult for potential ECs as Bankers have had their fingers burnt badly in view of the scale of their exposure, as of today, to the Nigerian energy industry.

In addition, generation companies (GenCos) are prevented, according to the rules, from selling contracted but unutilized capacity with the Nigerian Bulk Electricity Trader (NBET) to ECs. This does not make economic sense both for GenCos and for the Federal Republic of Nigeria. Infact, Nigerians are being short-changed as we all pay for the inefficiencies in the power sector since government provides a payment guarantee for unutilized and unsupplied electricity to GenCos. Furthermore, it is obvious that the major beneficiaries of the EC directive are large industries and heavy consumers of electrical energy in the country. The members of the Manufacturing Association of Nigeria (MAN) have naturally applied to switch customer classes to become ECs. As they subsidized the tariff paid by other classes of customers on the DisCosâ&#x20AC;&#x2122; financial income stream, it is difficult for DisCos to let go of them. This has led to MAN taking DisCos to court with NERC as a respondent. Thus, it is difficult for any of the parties, especially NERC, to mediate between the other two parties directly involved in the impasse. As of now, attempt towards an out of court settlement is been pursued. However, a resolution is not nigh. The level of network losses in the NESI is very high. Up to 50 percent of the electricity that flows through the electricity network disappears and cannot be accounted for. This is unsustainable and effectively means NESI cannot work efficiently. Yes, there are bottlenecks in the transmission and distribution network interfaces that impede the successful implementation of the EC policy. The following are my recommenda-

tions: DisCos should be allowed to participate in the EC market with business separation ensured by means of regulation; the requirement for letter of non-indebtedness be removed while an arrangement is made for the electricity market to pay the verifiable debts owed by prospective ECs; the court case between MAN, NERC and DisCos should be discontinued and the out of court settlement in process should be concluded; GenCos should renegotiate their agreement with NBET as far as the contracted capacity is concerned to reflect the level of consumption by the electricity market to date so as to provide additional capacity over and above the stranded 2GW for ECs. Other recommendations include; the Rural Electrification Agency (REA) should contunue to champion the provision of electricity supply to unserved, underserved and unsatisfied consumers using the many regulations and provisions within the NESI to help electrify the nation and catalyse the economy positively; NERC should simplify the application process, be less bureaucratic and continue with advocacy and education of consumers on how they can take advantage of the EC and many other policies available to maximise investment in the NESI. The EC policy is a radical departure from the status quo. It creates a positive shock to the NESI that will steer it in the positive direction. All stakeholders are encouraged to make room for shifts in their positions to allow the country to see the light. The focus of all stakeholders should be to give full effect to this policy directive. *Engr. Idowu Oyebanjo is the CEO, Idfon Power Engineering Consultants Limited (iPEC)

Wednesday 27 February 2019

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Odunayo Oyasiji

Meaning and implication of stabilization clauses in oil and gas contracts

il and gas contracts are usually long term agreem e nt s b e t w e e n a nation and an international oil company. Stabilization clauses are usually introduced in order to protect the interest of mostly the oil company in terms of the financial benefits that the company gets. This is because governments over time usually change policies with regards to taxation etc. These changes often impact negatively on the income of oil companies. Another issue that warrants such protection is the fact that people at the helms of affairs in a country do change and change in policies usually accompany such transfer of power. Stabilization clauses are targeted at managing what effect changes in law will have on contract signed by parties. Because the contracts are long term contracts, change in the law tend to affect the finances of the oil company. It is aimed at guarding against serious financial loss as a result of such change. In most cases, it is directed at neutralizing the effect of such changes that can affect the finances of oil companies negatively. There are different types of

stabilization clauses. The common types are- freezing clause, hybrid clause and economic equilibrium clause. 1. Freezing clause- Under this type, the host country enters an agreement not to come up with laws or regulations that will change or have effect on the contract signed throughout the lifespan of the agreement. It is called freezing clause because it freezes the right of the host state to make new laws and regulations that will affect the rights of parties under the contract. The laws that will be reckoned

with are the laws that were in existence at the time of signing the contract. Subsequent legislations and regulations are not to have effect on the contract. It has been said that a freezing clause can be either full freezing clause or limited freezing clause. A full freezing clause is one that addresses both fiscal and non-fiscal aspects. It freezes all new obligations arising from a new law or regulation whether such obligation is fiscal or not. Example is new obligation arising as a result of new environmental laws and regula-

tions. A limited freezing clause only address specified areas e.g. tax. Therefore, any new law raising the percentage of tax to be paid will not be applicable to the oil company. 2. Economic equilibrium clause-This does not freeze the law of a state. What it seeks to achieve is to maintain the economic equilibrium of the agreement entered into by the parties. New laws are applicable to the oil and gas contract. However, the state is under an obligation to reward the international oil company for complying with

the new law. Economic equilibrium clauses can either be limited or full. Full economic equilibrium clauses address effect the change in law will have on the financial situation of the oil company- which will necessitate the state to compensate them. The limited economic equilibrium clause tends to limit when the oil company can claim for compensation. Example of such clause is when it is stated that the oil company must have incurred a certain amount of loss before complaining or asking for compensation. 3. Hybrid clause- This tends to blend both the qualities of economic equilibrium clause and freezing clause. It basically aims to return the international oil company to its financial state before the enactment of the new law or regulation. Just like the earlier two stabilization clauses discussed above, the hybrid clause can either be full or limited. It is full when it shield the oil company totally from financial losses caused by change in the law by ensuring that the company is compensated. It is limited when the clause only shields investors in limited situations i.e. with regards to some specified changes.

The liabilities of the owner and hirer under hire purchase contract in Nigeria

he Hire Purchase Act regulates hire purchase transaction in Nigeria. The Act defines hire purchase in section 20(1) as “The bailment of goods in pursuance of an agreement under which the bailee may buy the goods or under which the property in the goods will or may pass to the bailee.” For easy understanding, hire purchase contract or agreement has to do with a person hiring something with an option for him to purchase it. The owner of a property lets it out to another person with an undertaking to sell it to the person or that it becomes the person’s property after he has paid an agreed amount over a period of time. It is usually paid in instalments. The ownership of the property does not get transferred to the person until the last instalment is paid. This type of contract is common with regards to vehicles, motorcycles and tricycles. There are usually two to three parties to such contract or agreement i.e. the owner, the hirer and a guarantor. The owner is the person that owns the property and is giving it out to another person in exchange for regular payment. The hirer is the person to whom the property is given

while the guarantor is the person that undertakes to take liability for the hirer’s obligations should the hirer fail or default. A hire purchase contract is expected to reflect some thingsbe written and signed by parties to the agreement, the price the hirer can pay to fully purchase the hired property, the amount and date when each instalment is to be paid and a good description of the property that

is subject of the hire purchase agreement. In a higher purchase contract, it amounts to a breach of contract for either party to unilaterally terminate the contract. Under the Act, when a hirer terminates the contract some liabilities will arise. The liabilities are1. Return the hired property to the owner. 2. Pay damages to the owner

in a situation where he hasn’t taken proper care of the property. 3. The hirer is under the obligation to pay half of the hire purchase price. 4. If the hirer has paid more than half of the hire purchase price he forfeits the extra amount paid. It must be noted that the ownership of the property that is the subject of a hire purchase contract is vested in the owner.

Therefore, the owner can take steps to recover the property from the hirer if necessary. However, such recovery cannot be made except by recourse to court if ‘relevant proportion of the hire purchase price’ has been paid. So what constitutes relevant proportion of hire purchase price? The Act states that if the property is not a motor vehicle then half of the hire purchase price is the relevant proportion while if it is a motor vehicle then three-fifth of the hire purchase price is the relevant proportion. What it means is that the owner cannot recover the property if the foregoing relevant proportion has been paid except by the help of the court. The Act suggests that where the relevant proportion hasn’t been paid then the owner can recover without the help of the court. Such recovery must still be within the ambit of the law. Where an owner does not operate within the ambit of the law to recover a property then he incurs some liabilities. The implications are- the hire purchase contract is terminated and the hirer is free from all liabilities and has the right to recover all monies paid to the owner under the contract.

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Opinion

Durotoye, Moghalu, Sowore & others: Unite for Nigeria!

FRANKLIN NNAEMEKA NGWU (PHD)

or the desire to serve, the toils of campaign and election, I say big congrats to Fela Dorotoye, Kingsley Moghalu, Omoyele Sowore and over 60 other candidates that participated in the presidential election. With the election over and the winner widely expected to be PMB or AA, I think it is time to reflect and re-strategize. Believing that you all came out due to your patriotic zeal and genuine desire to salvage Nigeria, the conduct of the election and the tentative results so far released all point to the fact that we as a country and people are still very far from what we should be. In fact, the work to create a country where all and sundry irrespective of tribe, religion and sex can aspire to achieve their full potential is just beginning and demands the full patriotic participation of all men and women of good will and salvific disposition. As we are expected to elect our leaders every four years, it is important that we appreciate that one person will always be elected as the President at the end of every election cycle! That is what our constitution allows at the moment.

With this being the case, I therefore implore all of you (seventy excluding PMB and AA) that while your presumed patriotic ambitions and innate desire to serve is most commendable, it is important to be a bit circumspect and realistic. As most of you came out based on the widely perceived failures of the two dominant parties- APC and PDP, it is difficult to understand the strategy that would have helped one of you to win without proper synergy, structure and leadership especially among yourselves. One of the observers lamented that the numerous 72 presidential candidates in Nigeria is like the size of his country’s parliament. Due to lack of proper coordination and unity, there are views that most you are the same or even worse than the old politicians driven mainly by ego and personal interests. There are also perceptions that some of you were sponsored by either APC or PDP. Even though the initial plan to get a consensus candidate among you failed, it is and should be a leadership test for all of you. If you are interested in leading a complex and plural society of about 200 million people, agreeing and presenting a consensus candidate from the remaining 70 of you would have been the first leadership test. As charity should begin at home, if none of you can properly co-ordinate 69 members of your presidential candidates’ family, then it will be difficult to convince Nigerians that you can govern about 200 million people. To achieve a vision, you need a strategy that is normally based

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...it is something I will recommend and encourage our many presidential candidates to do both as individuals and a group if they are genuinely interested in forming an alternative party and candidate to effectively compete with APC and PDP

on the deep assessment of your Strengths, Weaknesses, Opportunities and Threats (SWOT). And this should be done based on robust appreciation and examination of the Political, Economic, Social, Technology, Legal and Environmental situations (PESTLE) of Nigeria. Even though both SWOT and PESTLE analysis can be relative and subjective, it is something I will recommend and encourage our many presidential candidates to do both as individuals and a group if they are genuinely interested in forming an alternative party and candidate to effectively compete with APC and PDP. During the campaigns, there were many debates, accusations and quarrels as to why people who are dissatisfied with both APC and PDP still supported either PMB orAA. The answer is principally based on the robust and realistic assessments of the SWOTs of both candidates and their parties in line with the PESTLE of Nigeria. Like many other Nigerians, even though Iparticularly liked the plans and views of Durotoye, Ezekwesili, Moghalu, Sowore and few others, it was clear and painful that none of them will emerge due to our PESTLE trajectories. With 2019 election almost concluded, the plan for the next election should start. It is just about four years from now and this is the right time to start a proper assessments of the SWOTs of each of our young and alluring presidential candidates. As leadership requires an immeasurable dose of humility, I implore each and every one of you to reach out to the other candi-

dates to start the discussion on the unity and synergy required. Given our PESTLE and structural formation, it is almost impossible for any of you to make any meaningful impact in any election without this required unity and synergy. It is also important to appreciate that the success of any president or government does not depend on the sole capability of the president. It depends on the effective assemblage of many patriotic and competent team. In addition to the very important positions such as Chief of staff, Secretary to the government of the federation, Chief economic adviser, National security adviser and ministers, the president has within his powers and tasks to make over 250 strategic appointments. This means that if the desire to serve is truly of patriotic inclination, the utmost motive should be on how to contribute and not really to be the president. If we are really dissatisfied with the state of Nigeria and the leadership outcomes of APC and PDP, it is imperative that our presidential candidates close ranks and team up behind one person with the brightest chance of winning based on a robust assessment of the candidate’s SWOT in line with Nigerian PESTLE. Continuing with about 70 candidates is more of a support to either APC or PDP and the old politicians to continue their dominance and control of our governance and society. Dr. Ngwu is a Senior Lecturer in Strategy, Finance and Risk Management, Lagos Business School and a Member, Expert Network, World Economic Forum.

Politics and religion in Nigeria: A role for religious leaders Opeyemi IYOHA

he pilgrimage of religious leaders to the political dirty waters of Nigeria is not a recent affliction. It has been with us and shall continue to be until we are able to find a mean between the extremes of political rascality and religious bigotry. Religion cannot and should not be seen to be playing too much of a role in politics even though there is no time that politics and religion will totally divorce. Politics often seek the support of religion and there have been no national elections around the world where religion has not been covertly or overtly a factor of relevance. In the United States of America, for instance, the Republican Party employs the antics of religion. In the 2004 presidential election in the US, the defeat of John Kerry by George W. Bush was generally regarded as ‘religious victory.’ Though religion is necessary for every society to moderate the unspeakable acts of men in politics, it also has its obnoxious side effects- intolerance, divisiveness and persecution as we currently have it in Nigeria. To that extent, politics in

Nigeria has become a means of disordering our common good under the pretext of religion. Religion should give birth to all that is noble, expedient, lawful and essential in society. Therefore, religious leaders should, as a matter of course and fact, speak out from time to time but under no circumstances should they use their religious positions to ungodly influence the political direction of the country. The positions of religious leaders should be applicable and relevant to citizens, religious affiliation notwithstanding. This is the only way it is morally right and expedient to publicly intervene in the political process. Any religious intervention that does not seek to link our concern to our common aspiration as a people should be abhorred. What all of this means is that the message of religious leaders to their members and non-members as well should be reassuring and in good faith. I believe a number of religious leaders are actually seeking the good of the land in their quest to moderate political activities with spiritual variables. It is, unfortunate, however, that it seems some religious leaders across the religious divide, are making religion to unite with politics in an unholy attempt to obtain and monopolize political power. The harm which the situation could cause is no doubt undisputed. Whereas it is in order to educate the congregation on the need to vote

at elections in order to have credible leaders of choice, it is foolhardy and woolly thinking to prime members to vote in line with the dictates oftheir religious leaders.Religious leaders should come to the understanding that their members may be spiritually homogeneous but certainly are politically and socially heterogeneous. They should, therefore, not be expected to heed the admonition of their leaders hook line and sinker in political matters especially that politics in Nigeria is bereft of any value. Politics in Nigeria is deceitful and will always subdue religion and use it for its interest. The domination of religion over politics and society which it enjoyed during the medieval period is over. What we need at all times (before, during and after elections) are formidable preachers (be they pastors, bishops or imams) whose sermons are fierce and hard-hitting, especially for the spiritually nonconformist political class. We know the challenges of the political classshifty, untrustworthy, unreliable, violent, cruel, impatient, revengeful and ambitious where money is a key variable. They can’t resist money or anything denominated in it, especially easy money. They need sermons preached to them about their objectionable character, whims, and caprices. Religious leaders should preach to warm politicians to tremble at the word of God because any human endeavour that ignores

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Politics in Nigeria is deceitful and will always subdue religion and use it for its interest

God is bound to fail. The sermons do not have to be political in content but should be such that could lead politicians to be covered in glory in their activities.The influence of the sermons should be strong enough to cause changes in matters relating to politics and political offices.I know a few religious leaders who already preach thundering sermons against all manner of political lunacy and irresponsibility.This is encouraged to continue. It is fifty years after attaining independence, yet Nigeria is not in any way close to the twilight of political and religious fanaticism. The country is in a depressed state with no order and sense of national pride. The incomprehensible idol of primordial political life-style needs to be uprooted for Nigerians to live in peace with one another. Today, I make an altar call on religious leaders to rise and lend credence to the soul of religion and spirituality by building divine norms and values into the political affairs of Nigeria. The time to be ignorant and merely sail with the wind along with politicians, famous or notorious is over. They are a collective monster of ingratitude that should be resisted spiritually to a revolving degree. Prof. Iyoha is of the Department of Accounting, Covenant University Email: iyoha.francis@covenantuniversity.edu.ng

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