24-hour port operations: Customs, operators frustrate presidential order by Vanguard Media Limited

JUNE 11 , 2012 BY GODWIN ORITSE AND GODFREY BIVBERE

residential directive on 24-hour operations at the nation’s ports is being frustrated by disagreement between the Nigeria Customs Service (NSC) and maritime operators. Minister of Finance and Coordinating Minister for the economy, Dr. (Mrs.) Ngozi OkonjoIweala, recently at a press briefing in New York during the World Bank meetings, said that the President has directed that port operations must be on 24-hour basis. Investigations, however, revealed that the directive is yet to be implemented. Though stakeholders agree that the directive is practicable and good for the economy, they however disagree on why it is not being implemented. The Nigeria Customs Service (NCS) attributed the delay in the implementation to agents and banks, but maritime operators said the NCS is responsible for the delay. Speaking with Vanguard on the issue, spokesman for APM Terminals, Bolaji Akinola, said that 24-hour operations have been going on in the ports in Lagos. He explained that the Nigerian Ports Authority, NPA, has

24-hour port operations:

Customs, operators frustrate presidential order been carrying out marine operations (pilotage of vessels) on 24-hour basis over the years. He also pointed out that loading and off-loading of containers to and from ships has been on for a while, stressing that what is missing is the absence of 24-hour examination of goods at the ports by Customs. Akinola said that another problem that hinders 24 hours ports operations was that of insecurity in the country, saying that it makes it difficult for

consignees to take delivery of their goods after a particular time of the day. “Consignees cannot come forward for their consignments after certain time; they cannot take delivery of their consignments after certain time of the day because of the security challenges in the country,” Akinola said. Debunking the claims, Public Relations Officer, NCS, Wale Adeniyi, said that NCS has drawn up a roster for 24-hour operations, although the

schedule is not operational at the moment. Adeniyi said that the Customs service had actually commenced 24hour operations immediately after the directive but had to stop because shipping companies and banks were not operating the same hour of service to complement the 24-hour port operations. He said that the Customs had prepared a roster and had posted men and officers to man its various positions Continues on page 18

156.10

-2.35

2,155.00

+61.00

19.17

+0.27

98.70

-0.15

84.23

+0.25

CURRENCY BUYING CENTRAL SELLING

From left Dr. Olajide Basorun, Permanent Secretary, Ministry of Agriculture and Cooperatives, Lagos State; Prince Gbolahan Lawal, Commissioner for Agriculture and Cooperatives and Mrs. Olufunmilayo Bantefa, Director of Fsiheries Services, during a stakeholders' interactive workshop on Aquaculture, jointly organised by CBN and the Ministry, in Lagos.

CFA 0.2716 KRONER 25.8642 EURO 192.261 POUNDS 237.4942 RIYAL 41.2745 SDR 239.8471 FRANC 159.9835 DOLLAR 154.8 YEN 1.9783 RENMINBI 24.3081

0.2816 25.9478 192.8826 238.2613 41.4078 240.6218 160.5002 155.3 1.9847 24.3871

0.2916 26.0313 193.5036 239.0284 41.5411 241.3965 161.0169 155.8 1.9911 24.4661

CBN Exchange rate as at 08/06/2012

18 — Vanguard, MONDAY, JUNE 11, 2012

Cover Story

YOUTH RESTIVENESS AND UNEMPLOYMENT – THE WAY OUT (PART 3)

24-hour port operations: Customs, operators frustrate presidential order Continues from page 17 at the terminals, but the Service had to return its men and officers to their various posts because the banks and agents were not forthcoming and the agency could not continue to waste manpower. He noted that in a situation were shipping companies were not sending containers for examination and the banks were not open for agents to pay their duties, the efforts of the Customs came to naught. “If one, two or three agencies are ready for the project and the banks and agents who are also very key to the entire project are not ready, there is nothing anybody can do about it”, he said. National President of the Association of Nigeria Licensed Customs Agents, Prince Olayiwola Shittu, in his response to the position of the Customs said that it is not true that shipping companies and banks hinder the implementation of the directive on 24-hour port operations. According to him, “24-hour examination of consignments does not need shipping companies or banks.” He said that what they need are terminal operators who will position consignments for examination. Shittu explained that they recently held a meeting with the Comptroller-General of Customs, Alhaji Abdullahi Dikko, where they requested for officers to be posted to the ports for weekend operations. He noted that their request was granted and the Customs boss promised to direct the Customs Area Controllers, CAC, at the various ports to take action. The ANLCA boss however, noted that midnight ports operations is possible but may not be realistic for now as

a result of the challenging security situation in the country. He explained that terminal operators are ready for weekend operations and containers examined over the weekend are those that will proceed for delivery during the week. He said that the advantages of weekend operations are very many, saying that agents should take advantage of it. He further pointed out that with sincerity on the part of all stakeholders in port operations, 24-hour cargo delivery will be possible. He averred that 24-hour port operation is possible and practicable, adding that the recently introduced biometric identification card for agents can be used for duty payment. Dikko said that Customs now carry out examination of containers at weekends and this, according to him, has gone a long way to quicken cargo delivery process. He explained that an agent can upload his invoice electronically and make duty payment through the same process, noting that it is only the terminal operators and shipping firms that would upgrade their systems and operations to make them assessable electronically. “We are currently working with some terminal operators to upgrade our portal so as to make them assessable for epayment. It is operators who want to continue in their corrupt way of life that will think and say that 24-hour port operation is not possible,” he added. General Manager in charge of Public Affairs, NPA, Chief Michael Ajayi, said that NPA has been operating on a 24-hour basis even before the port was concessioned. Ajayi stated that NPA has been running a shift system

from the time it was created; adding that 24 hours port operations is not new to its management. He also said that besides the NPA and the Nigeria Customs Service being ready for 24 hours port operation, there is need for others, particularly the banking sector to key into the project, adding that when fully implemented, it would create job opportunities in virtually every sub-sector of the Nigerian maritime industry. Ajayi explained that with the cashless policy of the Central Bank of Nigeria (CBN), importers and agents can pay import duty electronically and confirm same to the Customs through the same means. The NPA spokesman added that importers can do their documentation in the night and take delivery of their cargo in the morning so as to beat security challenges at night. On the issue of added cost to terminal operators, Ajayi explained that a high turnover of container operations will lead to high financial turn over, more revenue for both Customs and NPA, explaining that more jobs will be created and the economy will be better for it. On his part, Managing Director of Cotecna Destination Nigeria Limited, CDNL, Mr. Tayo Rabiu, in an interview with Vanguard, said that Cotecna has since commenced 24- hour service at both Tincan and Apapa ports. Rabiu explained that they do this by posting their workers in shift to ensure that scanning operations go on 24 hours at the scanning sites. On whether scanning services are carried out at the bonded terminals, the Cotecna boss said that they are not doing so presently but stressed that they have the capacity to do so should they be directed to.

The AgriBusiness Food Security Summit Tittle: Enhancing Agriculture Value _ Chain For Economic Prosperity,:Sponsor By Accenture Nigeria.Held at Eko Hotel Lagos Pix L- R Mr. Gbenga Ibikunle Executive Director, BATN Mrs Juliet Anammah , Director Real Sector, Acceanture Nigeria Quest Speaker, and Mr Bert J. Ronhaar H. E. The Netherlands Ambassador to Nigeria Photo By Diran Oshe

EFFECTS OF UNEMPLOYMENT IN NIGERIA Every year, over 300,000 graduates are churned out from the tertiary institutions nationwide. This number grows yearly and translates into more and more unemployed people littering the streets of Nigerian cities. Below are some of the effects of unemployment in Nigeria. Mental health: Mental health problems like: Law self-confidence, feeling unworthy, depression and hopelessness. With the lost income and the frustration involved in it, the recently unemployed may develop negative attitudes toward common things in life and may feel that all sense of purpose is lost. Frequent emotions could be – low self-esteem, inadequateness and feeling dejected and hopeless. Health diseases: The unemployment overall tension can increase dramatically general health issues of individuals. Tension at home: Quarrels and arguments at home front which may lead to tension and increased numbers of divorces etc. Political issues: Loss of trust in administration and the government which may lead to political instability Tension over taxes rise: Unemployment also brings up discontent and frustration amongst the tax paying citizens. In order to meet the demands of the unemployment fund the government many a times may have to increase the taxes thus giving way to restlessness amongst the tax paying citizens. Crime and violence: Increase in the rate of crime in the society It is the duty and Suicide cases: Increase in the responsibility of the rate of suicide attempts and government and actual suicides as well. different policy Stigma: Unemployment brings makers to provide with more than just ‘no work’. such an It also brings with it the environment and disgrace that the person has to conditions which bear. Nobody likes to be termed are conducive for as unemployed. the youth Employment gaps: To further entrepreneurial complicate the situation the activities. Different longer the individual is out of policy initiatives job the more difficult it encourage and becomes to find one. motivate young Employers find employment people to come up gasps as a negative aspect. No with new ideas and one wants to hire a person who start their own has been out of work for some youth enterprises. time even when there’s no fault of the individual per say.

Lose of skills’ usage: The unemployed is not able to put his/her skills to use. And in a situation where it goes on for too long the person may have to lose some of his/her skills. THE ROLE OF GOVERNMENT. It is the duty and responsibility of the government and different policy makers to provide such an environment and conditions which are conducive for the youth entrepreneurial activities. Different policy initiatives encourage and motivate young people to come up with new ideas and start their own youth enterprises. This will first reduce the incidence of unemployment to a great extent and as such would have dealt a massive blow to the problem of youth restiveness. To do this effectively, the policymakers need to realize that alone public spending is not going to contribute towards the welfare of the youth. It is the policies of the states that must be created in a way that will help to stimulate the younger people as well as their parents and communities to invest in themselves. The main essence of implementing youth friendly policies is they are not as costly as direct investments but require a lot of political tradeoff to actually implement the policies so that they benefit each and every young person living in the country.

Vanguard, MONDAY, JUNE 11, 2012 — 19

he Federal Government in its reaction to the plane crash two Sundays ago, has set up a panel to conduct an audit of airlines in the country. The audit panel has six months to do its work and submit its findings to government. Nigerian government is known for reacting to situations instead of being proactive. The audit panel is coming too late after the nation was needlessly plunged into mourning by allowing mindless companies to operate airlines with molue kind of aircraft. Nigerians who live in Lagos and Ibadan have experiences of what molues are. They are ramshackle vehicles with mindless drivers. Many operate with expired tyres; no traficators, headlights, unserviceable engines and they could enter the road at will not minding the safety of their passengers and other road users. Several times in Lagos, these molues with several passengers on board, had plunged into the lagoon with all passengers drowned. Each time it happened, there will be weeping, condolences and a promise by government to do something about them. Nobody ever did. Molues on Nigerian roads are being phased out as a result of government policy which has provided Lagosians with better alternatives of land transportation. Today, Molues are now in the Nigerian airspace. Most of the aircrafts in the Nigerian air space are no better than molues. The aircrafts are old, the engines are unserviceable, yet, they are allowed to fly the Nigerian air space. Will the panel set up by this government bring back the lives of more than 153 persons who perished in that aircraft? What succour will it bring to the families of the victims? Dana plane, a Boeing McDonnell Douglas 83 with registration number 5N-RAM, crashed into a building in the densely populated Iju-Ishaga area of Lagos, less than two minutes to touchdown. One hundred and fifty-three people onboard perished in the tragedy. These exclude those who were killed in their homes which the aircraft plunged into. The crash happened less than 24 hours after a Nigerian cargo plane crashed into a passenger bus in Accra, Ghana, killing 10 people. Is the Dana crash the first in the history of Nigeria civil aviation? Certainly not! In all the previous ones, investigations were carried out and after the mourning period, the system went back to status quo. Nothing else caused this disaster than corruption. Those charged with the responsibility of ensuring safety in the air space have sold their consciences for peanuts. They prefer to sacrifice the lives of Nigerians for peanuts, by collecting gifts, free tickets and bribes and look the other way when operators are doing the wrong thing. A lot has been revealed since the crash. Why should government wait for the worst to happen before acting? Why must

we wait till things go bad before we act? Why should we watch things go this wrong, all because of corruption? The owners of Dana Airline are three Indian brothers who had been previously extradited from Nigeria for fraudulent practices. The crashed plane was said to be a faulty plane known to both the owners and operators. The said plane is

crashed two Sundays ago, is alleged to be over 22 years. Though the management of the airline claimed that the plane was in good condition, it is imperative to note that the former Minister of Aviation, Kema Chikwe, had directed, after the Kano crash of 2002, that no plane aged over 22 years should fly in the Nigerian airspace. The management of the airline, Nigeria Civil Aviation Authority, Ministry of Aviation officials and the Minister of Aviation have a lot of explanations to make. Nigerians are waiting!

BRIEFS Bayelsa rues poor IGR, moves to diversify economy BY SAMUEL OYADONGHA

Presidential audit panel, for already wasted lives? about 22 years old acquired some five years ago from US when Dana Company floated an airline. The Aviation Ministry is said to be in the know of its deplorable condition and said it gave a warning. After the crash, everyone is talking; Dana Staff are speaking about how the owners insisted that the pilot should fly. Governor Akpabio talked about his complaints to the airline after the plane experienced failure the week before the crash. Where were the officials of the Nigerian Civil Aviation Authority and other relevant agencies that should have arrested the situation? It is common knowledge in the aviation industry that operators are becoming very few and are cutting corners. Pilots are given definite instructions, ‘if you have a snag in an aeroplane, do not put it on your technical logbook, write it on a piece of paper, when you land, give it to the engineer.’ Will the federal authority say they are not aware of this development- that it is the airline engineers on ground that determine the fitness of a plane to fly? According to airline operators, if the engineer is able to fix a reported snag handed over to him by a pilot, good; if he is

unable to fix the snag, the aeroplane goes into service because there will be no evidence in the check log. The check log is the book that shows record of complaints made by pilots, but in the Ni-

ground. In 2005 alone, two major disasters occurred. On October 22 of that year, a Bellview Airline’s Boeing 737 crashed soon after take-off from Lagos, killing 117 people on board. On December 10,

Is Dana crash the first in the history of Nigerian civil aviation? Certainly not! In all the previous ones, investigations were carried out and after the mourning period, the system went back to status quo

gerian aviation setting today, such a report will not be found. What then will this audit panel do? Pass a clean bill of health on Dana Airline? Before this latest accident, the country had experienced a series of air disasters in the recent past. On May 4, 2002, for instance, an EAS Airline’s BAC 1-11-500 crashed into a poor, densely populated suburb of Kano. It burst into flames, killing 148 people – 76 on board and 72 on the

2005, a Sosoliso Airline’s DC9 crashed in Port Harcourt, Rivers State, killing 103 people, most of whom were school children. The nation had yet to overcome this tragedy when an Aviation Development Company Airline’s Boeing 737 also crashed shortly after take-off from Abuja, killing 104 people on board, including the then Sultan of Sokoto, Muhammadu Maccido. This happened on October 29, 2006. This particular plane that

ayelsa State Gover nor, Seriake Dickson, has described as worrisome the state's poor Internally Generated Revenue (IGR). He, however, assured that his administration was making frantic efforts to reverse the trend by creating enabling environment for investors to come into the state to boost the local economy. Most of the few business outfits including oil multinationals, exploring the large crude oil deposit in the state, he lamented, do not have their corporate offices in Bayelsa in spite of the ecological problems caused by their operations with the result that they pay taxes to other states where their headquarters are located. Dickson stated this during the monthly Transparency Initiatives briefing held Wednesday at the state Banquet Hall in Yenagoa. His words: “We have a big problem in generating sizable IGR and this is detrimental to the rejuvenation strategies aimed at repositioning the state's economy. Our IGR is even less than what some local governments in other states generate. We are facing developmental challenges and that is why we are investing in peace and security as catalyst to attract local and foreign investments. The magnitude of the economic problems informed our trade mission trip to South Africa as part of our moves to evolve stronger pedestal for our economy to grow.”

20 — Vanguard, MONDAY, JUNE 11, 2012

Business & Economy World food prices fall in May: UN’s FAO

BRIEFS CBN set to regulate management of commercial banks

he Central Bank of Ni geria (CBN) says it is working on a code to assist it in regulating activities of commercial banks. Mr Sola Awoyungbo, the CBN Director for Financial Policy and Regulations, disclosed this in an interview with the News Agency of Nigeria (NAN) in Lagos. He said that the code would define the calibre of people who would be on the board of commercial banks in Nigeria. “We want to promote the independence of those on the board of banks. We must have independent directors on the board of banks. They should not be shareholders. They should be people who are independent in their opinions. They must, however, have relevant experience. We want the appointment of people of integrity because they are expected to monitor the activities of the management on behalf of the shareholders,” he said. According to Awoyungbo, the code, which will be ready soon, will highlight the required qualifications and experiences of intending bank directors. Awoyungba said that the apex bank was also working to reduce the stringent conditions given to customers who wanted to open accounts with commercial banks. Singapore’s Olam buys Nigerian Food Company Singapore commodities trader Olam International Ltd said it bought 100 percent of Nigerian dairy and beverage company Kayass Enterprises S.A. for $66.5 million.

Osun to spend N27m on fish farming project

sun Government is to s pend more than N27 million on the first stage of its planned fish farming project. Dr Wale Bolorunduro, the state Commissioner for Finance, Economic Planning and Budget, said this in an interview with newsmen in Osogbo. Ahead of the initiative, the commissioner said the state government had concluded plans to train a large number of cadets from its Youth Empowerment Scheme (OYES). According to him, the state government will partner with Messrs Kayo Lad Nig. Ltd. to tap the full potential of the fishery business billed for Odo-Otin Local Government Area. He said the cadets to be trained would thereafter be supported by the state government to establish their own sustainable fish farms.

The First Lady of River State Mrs Dame Judith Amaechhi paid a Courtesy call to group Managing Director of Daimond Bank Plc Dr. Alex Otti in his Office Lagos. From left Mr. Victor Ezenwoko, Executive Diractor Regional Businness South, First Lady River State Mrs Pame Judith Amaechi, Dr. Alex Otti GMD /CEO Diamond Bank Plc Mrs Caroline Anyanwu -(ED ) Risk Management Diamond Bank Plc Mr. Uzoma Dozie - ED Corporate Banking , Diamond BankPlc Photo By Diran Oshe

CBN approves N75bn for NIRSAL’s take-off By FAVOUR NNABUGWU

he Central Bank of Nigeria (CBN) has approved N75 billion for the take off of Nigerian Incentive-Based Risk Sharing in Agricultural Lending (NIRSAL). The apex bank has also guaranteed 75 per cent loans provided by Deposit Money Banks to farmers across the 36 States of the Federation and the Federal Capital Territory as part of concerted efforts to transform the agricultural sector. Head of NIRSAL Project Implementation Office under the Development Finance Department of the CBN, Mr. Jude Uzonwanne, stated this in Abuja at a presentation on the role of NIRSAL to the Minister of State for the Federal Capital Territory, Oloye Olajumoke Akinjide. Uzonwanne stated that the guarantee would be issued by the NIRSAL to the farmers in the states and FCT through commercial banks and other financial institutions. He explained, “NIRSAL mobilizes financing for Nigerian agribusiness by using credit guarantees to address the risk of default. NIRSAL is a flexible financing tool designed to change the behaviour of financial institutions. “It covers all crops and livestock activities in Nigeria, while driving improved investment outcomes and job creation. It is also building on a legacy of previous CBN interventions in agriculture that has helped create

thousands of jobs.” He stated that the CBN programme was designed to create access to finance by integrating end-to-end agriculture value chains such as input producers, farmers, agro dealers, agro processors and industrial manufacturers with agricultural financing value chains – loan product development, credit distribution, loan origination, managing and pricing for risk, and loan disbursement. “The integration is driven by NIRSAL’s 5 pillars, particularly the Risk Sharing Pillar and the Technical Assistance pillars such as Risk sharing Facility (?45 billion), Insurance Facility (?4.5 billion), Technical assistance facility (?9 billion),

Agricultural bank rating 8(?1.5 billion), and Bank incentive mechanism (?15 billion). “NIRSAL will share risks with banks ranging from 30% to 75% of loss depending on the segment. We are prepared to offer following terms to farmers in the States and FCT Abuja: 75% guarantees on all input, working capital and limited living cost loans to plant the crop, and loan duration should be about 24 – 28 months,” he noted. The loan guarantee is being packaged under the, a public private established by the CBN, the Bankers’ Committee and the Federal Ministry of Agriculture and Rural Development.

orld food prices dropped in May for a second month in a row, hit by steep falls in dairy products, sugar and other commodities, and are likely to fall further in the coming months, the United Nations’ Food and Agriculture Organisation (FAO) said. Food prices grabbed attention of the world leaders after their spike to record highs in February 2011 helped fuel the protests known as the Arab Spring in the Middle East and North Africa. Food prices have fallen since. Improvement in the security of food supplies amid the economic downturn was high on the agenda of a summit of leaders of the G8 industrial powers last month. The FAO Food Price Index, which measures monthly price changes for a food basket of cereals, oilseeds, dairy, meat and sugar, averaged 204 points in May, down from 213 points in April, the FAO said in its monthly index update. New Lagos transformer plant will save N1.5b for Nigeria Nnaji Minister of Power Prof. Barth Nnaji has said that the repair of electricity transformers in the country would save Nigeria more than N1.5 billion. Nnaji made the disclosure at the inauguration of the manufacturing and repair transmission equipment plant of the Skipper Group in Lagos. Nnaji said the company would save for Nigeria, the huge foreign capital spent on shipping damaged transformers abroad for repairs. He reemphasised the Federal Government’s commitment in supporting investors in the nation’s power sector. The minister said the project would also develop our local content by employing Nigerians in various fields.

MSMEs key to success of vision 20-2020, say NBS, SMEDAN By CHRIS OCHAY I

or the nation to attain its aspiration to be among the top twenty economies in the world by the year 2020, it has to pay serious attention towards development of Micro, Small and Medium Enterprises, MSMEs, the Statistician General of Nigeria, Dr. Yemi Kale has said. D r. Kale’s remarks was contained in a data survey presented Wednesday in Abuja, which revealed that MSMEs play a very big role in the Nigerian economy, contributing about 46% of the

Gross Domestic Product, GDP. The document which is the report on 2010 national MSME was conducted by the National Bureau of Statistics, NBS, in collaboration the Medium Enterprises Development Agency of Nigeria, SMEDAN. The survey was conducted to determine the level of contribution of the sector to the Gross Domestic Product; Contribution to employment; Determine the number of MSMEs in Nigeria on geopolitical and sectoral basis; Identify the challenges and constraints confronting the operations of MSMEs in Nigeria; Identify the skill

gaps within the sector; as well as to determine the grow rate of MSMEs; among others. The report presented by Dr Yemi Kale, Statistician General and Muhammad Nadada Umar DirectorGeneral/CEO of SMEDAN. Respectively, said the sector shows significance and the potential for growth if the properly developed “particular as the nation aspires to be among the top twenty economies in the world by the year 2020.” “The Report concludes by highlighting the challenges facing the MSME sector in Nigeria.

Vanguard, MONDAY, JUNE 11, 2012 — 21

Business & Economy

GRC Motorsport to create thousands of jobs in Nigeria By EBELE ORAKPO

RC Motorsport is set to make Nigeria a part of the billiondollar motorsport industry through partnership with the third largest sports car manufacturing company in the UK. In an exclusive chat with Vanguard in L agos recently, . Ribi Adeshokan, the Chief Executive Officer of GRC Motorsport said: “The company is a family-run business which started over 30 years ago. Not only will we become their sole distributor to Africa, we will also be part of the team, coming up with the design, from chassis to body work, to engine because everything is built in-house.” Explaining further, Adeshokan said the company intends to give the youths and students the opportunity to come up with a good car design. “We give them a basic shape and expect them to use their own initiatives to come up with better designs. So at the end of the day, we will pick the best design and use it in the next model of the car.” According to Mr. Adeshokan, the company is also seeking sponsors for the activities of Team Nigeria Racing Eagle. “The sponsors will sponsor Team Nigeria and the team becomes their marketing platform and one of the key

survey carried out by M a s t e r C a r d Worldwide has revealed that 92 per cent Nigerians have a strong and positive sentiment towards online shopping. In addition, 57 per cent of those Nigerians who had shopped online in the three months prior to the survey being conducted indicated that they are likely to continue making purchases online over the next six months. Country Manager, West Africa, MasterCard Worldwide, Mrs.Omokehinde Ojomuyide said that Nigerian online shoppers believed there are wider purchase choice online than offline, explaining that shopping online was convenient, easy and that most goods were cheaper online than they were offline. Ojomuyide pointed out that

Institute to commission SCADA/ Smart Grid

From left: Winner and student, Mr. Tony Willie; Dean, Student Affairs, Prof. Akporuno Temi; Director of Sports, Achugbue Tony; Vice-Chancellor, Prof. Eric Arubayi and Analyst, Social Media, Etisalat Nigeria, Ms. Onyinye Egwudo during the presentation of a brand new Hyundai i10 at the Etisalat Cliqfest campus tour in Delta State University on Friday, May 25th objectives of the team is to make sure that the sponsors are able to get return on their investment so it is not like they are just going to be giving money away without getting anything in return. Motorsport sponsorship is beyond brand visibility on the car or on the suit,” he stated. Shedding more light on how the sponsors will benefit from the partnership, he said: “We

look at their target audience, their potential and existing customers. Number one, how do we continue or support them as a step towards making the existing customers happy? Part of what we will do is to invite them to our races and while they are at our VIP hospitality attending our races, we showcase what the sponsoring brand is all about in terms of

customer service and things like that. Again, the kind of hospitality and treatment we offer all our guests is going to be second to none and this will make them very happy and at the same time, we have lots of merchandise which can be given to new buyers and existing customers.” Continuing, he said: “There are some unique selling points which we will be coming up with.

92% Nigerians optimistic about online shopping —Survey BY PROVIDENCE OBUH

BRIEFS

MasterCard conducted the research to identify the factors that influence Nigerians’ sentiments towards online shopping, According to her, “shopping online is just one way that Nigerians can reduce their dependence on cash payments. MasterCard’s vision is to create a world beyond cash; we are spearheading a focussed drive towards a cashless society in Africa, where cashless transactions will assist in improving the lives of the people in the continent’s by removing the risks and expenses associated with carrying, using and handling cash. “These findings are obvious note for entrepreneurs that Nigerians who are shopping online see the value in purchasing locally, which creates a considerable business opportunity for them to enter this exciting retail sector, while it is still in its early growth stage.

However, the survey, which serves as a benchmark that measures consumers’ propensity to shop online, was conducted for the first time in Nigeria, in 25 countries from December 5 th , 2011 to January 6th 2012 and involved 12,500 consumers,

between the ages of 18 and 64 who were asked questions about their online shopping habits. Meanwhile, the research also emphasised the reasons why the majority (78 per cent) of Nigerians surveyed do not currently shop online.

Tourism will boost Nigeria’s GDP, foreign exchange earnings —Minister

he Minister of Tourism, Culture and National Orientation, Chief Edem Duke, has expressed the ministry’s commitment to increase Nigeria’s Gross Domestic Products (GDP) and foreign exchange earnings. Duke said this at the African Arts and Crafts Expo (AFAC) with the theme “Promoting the crafts industry for economic transformation”, in Abuja on Thursday. The expo was organised by the National Council for Arts and Culture.

He urged Nigerians to harness the potential that abound in arts and crafts industry as a non-oil sector to contribute to the country’s GDP. The minister said the industry would significantly assist to combat rural-urban migration, youth restiveness and militancy. Duke added that the arts and crafts industry would further empower women and contribute to the realisation of the Millennium Development Goals “and indeed the nation’s achievement of target by 2020”.

he Managing Director, National Power Training Institute of Nigeria (NAPTIN) Mr Reuben Okeke, says the institute will soon inaugurate a SCADA /Smart Grid to ensure power stability in the country. SCADA is a supervisory control and data acquisition or computer system that monitors and controls industrial, infrastructure, or facility-based processes. Smart Grid is a digitally-enabled electrical grid that gathers, distributes, and acts on information about the behaviour of suppliers and consumers. Okeke said in Abuja that SCADA would assist the power sector in ensuring that challenges in the industry such as power transmission and distribution, and energy consumption were identified and resolved. “We are going to commission a SCADA and Smart Grid either in July or August this year. SCADAis automation and with its help, one will know exactly what the distribution man is doing with the system anywhere in the country. It has Remote Terminal Unit which enables an engineer at the National Control Centre, Osogbo, to give command to an engineer, in Benin for instance, to switch- off a particular unit of power.

African Cocoa Initiative to establish 100,000 cocoa farms in 4 African nations

he Global Development Alliance Programme has released 13.5 million dollars to African Cocoa Initiative (ACI) to establish 100,000 farms in four countries to boost cocoa production. Mr Scott Wallace, the Country Representative of International Centre for Soil Fertility and Agricultural Dev e l o p m e n t , (IFDC) said in Abuja on Thursday that the four countries were Nigeria, Ghana, Cameroon and Cote d’Ivoire. Wallace said that the ACI’s five-year programme, which began in January, would help to develop the cocoa sector in the four countries in four critical areas.

22 — Vanguard, MONDAY, JUNE 11, 2012

Banking & Finance

pposition to the p r o p o s e d amendment to the enabling Act of the Central Bank of Nigeria (CBN) designed to remove the autonomy of the apex bank gathered storm last week as stakeholders in the banking industry led by the Chartered Institute of Bankers of Nigeria (CIBN), Nigeria Deposit Insurance and other top bankers spoke against the move insisting that an independent central bank is the global best practice. The National Assembly wants to review the CBN Act 2007 among other things to enhance the powers of the Bank to prohibit transactions with Foreign Currencies in Nigeria; compel the Bank to submit its Annual Budget before the National Assembly; alter the governance structure of the Bank and for Related Matters. Specifically, the National Assembly wants the CBN, like other ministries, department and agency (MDAs) of the federal government to submit its annual budget for approval. It wants to remove the deputy governors from the board of the CBN. The amendment also seeks to make an independent person appointed by the federal government the Chairman of the Bank’s board while the CBN Governor will just be the chief executive. While stakeholders support the amendment to empower the CBN to prohibit transactions in foreign currencies in Nigeria, they however oppose subjecting the Bank’s budget to legislative approval and the appointment of an independent person as chairman of the board. On the empowerment of the apex bank to prohibit transactions in foreign currencies, the CIBN said, “As it relates to prohibition on transactions with foreign currencies, we are of the view that the proposed amendment has good intentions to strengthen the position of the Naira as the legitimate legal tender in Nigeria; enhance monitoring and accountability of the foreign currencies in circulation; and reduced the possible inflationary effect”.

he NDIC also supported the move saying, “All monetary transactions in Nigeria should be based on the local currency, the Naira. The practice where some transactions are quoted in foreign currencies is alien to best practices. Consequently, we strongly support the proposed amendment”. But on the submission of budget and independent chairman of the CBN Board, CIBN said, “A survey of 35 central bank boards, in countries at various levels of development revealed that, without exception, the

Opposition to removal of CBN’s autonomy gathers storm

Sanusi Lamido

By BABAJIDE KOMOLAFE

The ability of the Central bank to speak out, if needed, and possibly in critical terms with respect to economic and budgetary policies, might be impaired

Central Bank Governor act as Chairman of the Boards of these central banks. It is also pertinent that, in Mexico and Korea, there are no external directors, as their Central Bank Boards consist solely of the governor and a number of deputy governors. According to Mr. Segun Aina, OFR, FCIB, President/ Chairman of Council who made the presentation on behalf of the Institute and the banking industry, “The composition of the Board proposed by the Bill effectively reduces the impact of the CBN’s Management on board decisions and may lead to unintended consequences. “The proposed amendment will undermine the independence of the CBN in discharging its functions satisfactorily to achieve the desired macroeconomic

stability for the growth and development of the economy. “The ability of the Central bank to speak out, if needed, and possibly in critical terms with respect to economic and budgetary policies, might also be impaired.” NDIC on its part said that subjecting the budget of the apex bank to legislative approval process poses major challenge to the ability of the bank to function effectively. It said, “At first sight, it may appear imperative for the CBN to use the budget process being adopted by Federal Agencies/Parastatals. This method would include the use of the following common budgetary devices: displaying both gross receipts and operating expenses; its asset transactions; and projecting outlays of expenditures and receipts for five years into the

future and from there generate a budget for the fiscal year for accountability and control purposes, among others. While the foregoing may be feasible, its application to central banks will no doubt, create major problems for their operations. In the case of CBN, this problem is particularly serious because many of the asset transactions of the CBN result from its efforts to influence the pace of growth of the economy through its control over money supply and these are not comparable to the asset transactions of other agencies. Projecting cash flows that include asset transactions would pose special problems for the CBN because they cannot be easily pre-determined. Moreover, the separation of monetary policy expenses from other expenses cannot be easily accomplished because of shared support and overhead costs.”

imilarly, a Past Presi dent and Chairman of Body of Past Presidents of the Institute affirmed the position of the Institute by saying that the apex bank should continue to have its operational and financial autonomy and the budget should not be subjected to financial appropriations. “I strongly implore members of the Senate and House of Assembly to leave the CBN Act

alone as it was conceived by the founding Fathers in 1958”. Another Past President of the Institute, HRH Prof. Green Nwankwo, OON, FCIB alongside Managing Director/Chief Executives of Banks spoke-out in total support of CBN autonomA top banker, Vice Chairman and Chief Executive Officer, Ancoria Investment and Securities Limited, Dr. Olusola Dada, also maintained that all over the world, central banks are independent. Dada advised that the CBN Act should not be amended such that the apex bank will be reporting to the ministry of finance, insisting that the Bank ought to report directly to the Presidency. “In this era of globalisation, Nigeria cannot afford not to follow the global trend. A truly independent and autonomous CBN has become more imperative for the integration of our financial system with the world economy in general and the West African sub region in particular. “What is required now is not to erode the financial autonomy of the CBN but rather to build and strengthen relationships that would enhance complementary role between the monetary and the fiscal authorities, and ensure accountability and transparency,” he added. This position was re-echoed by the Managing Director/ Chief Executive Officer, Maxifund Investments and Securities Limited, Mr. Okechukwu Unegbu. Unegbgu, who was a former Chief Executive Officer of the defunct Citizen International Bank, warned that amending the CBN Act would distort the system. He made these remarks at the Zenith Bank sponsored Finance Correspondent Association of Nigeria (FICAN) bi-monthly forum that was held in Lagos recently. He spoke on the topic: “Banks’ Financial Performance in 2011 and Q1 2012: Implication for the Capital Market.” He added, “Why is the National Assembly trying to amend the CBN Act? The reason and only reason is because there is one strong character that had taken them on. We should be thinking of building strong institutions, so that anybody who gets there, whether the person is weak or strong, will continue to evolve in the system. “We wrote a memo to the National Assembly, telling them that it is not right to do that. We fought for the financial and instrument autonomy of the CBN and so people cannot just destroy it.

Vanguard, MONDAY, JUNE 11, 2012 — 23

Banking & Finance

Cashless: CBN to acquire new fraud prevention system •As banks deploy 100,000 PoS terminals By BABAJIDE KOMOLAFE

he Central Bank of Nigeria (CBN) is set to acquire a new fraud prevention system to boost the cashless Nigeria initiatives Meanwhile banks in the country have deployed 100,000 Point of Sale (PoS) terminals and are expected to deploy 50,000 more before the end of the year. Head, Shared Services at the Central Bank of Nigeria (CBN), Mr Chidi Umeano, who disclosed this in Lagos, said banks are expected to have deployed over 150,000 PoS terminals by the end of this year. Banks have continued to roll out more innovative electronic payment platforms to meet customers’ expectations. Currently, banks have deployed about 100,000 PoS terminals and before the end of the year, if things go as planned, about 150,000 PoS terminals will have been deployed. “The cash-less project is on course and the initial challenges are being overcome,” he said. He said the CBN is set to acquire a new fraud prevention system, payments system oversight and anti-

fraud system, to tackle fraud in the electronic payment (epayment) system. He said the goal of the system is to provide the facility to distinguish fraudulent and legitimate transactions based on redefined checks in online payments. This will allow only legitimate transactions to be processed. The CBN he said believes the adoption of the system will boost the cash-less initiative by strengthening the protection against fraudulent payment activities. Fraud has always been one of the biggest

challenges of any online payment system. Increasing fraud rates around the world has dampened the growth of electronic payment by exposing merchants to substantial losses and unnerving security-conscious customers. “The fraud detection system will help detect potential fraud situations through the generation of online alerts as a result of transaction analyses,” Umeano said. He said this would help the apex bank in the efficient documentation of potential

fraud situations, as well as facilitate identification and capturing of fraudsters. Aside the payments system oversight and anti-fraud system, Umeano noted that CBN, as part of measures to manage fraud on the epayment landscape, had in 2010, effected migration from the magnetic stripe-based payment tokens, to the Chip and Personal Identity Number (PIN)-compliant channels and tokens, thereby recording over 90 per cent drop in cardrelated fraud incidents. He added that the CBN instituted an industry ATM Anti-fraud Committee, which was adjusted to become the E-Payment Fraud Forum, a group that ensures that antifraud mechanisms are kept abreast of new challenges for proactive responses. Conequently, Umeano called on the National

Mainstreet Bank board sets strategic agenda, eyes market leadership M

ainstreet Bank Limited has drawn a road map to attain market leadership in its bid to validate the confidence of its shareholder and retain the loyalty of its customers across Nigeria. Rising from a Strategy Meeting that was fully attended by all members in Lagos over the weekend; the Board of Directors of the Bank declared its intention to pursue a set of initiatives and strategies that would return Mainstreet bank to the league of Nigeria’s top four banks. According to a statement, at the Strategy Meeting, the local business environment was thoroughly analysed and the relevant market segments clearly defined to pinpoint where Mainstreet Bank

would operate at full speed for a stronger positioning and rapid result. The bank’s Board of Directors also assured customers and other stakeholders that Mainstreet Bank would soon take its position as one of the top four banks in Nigeria performance indices and innovative product offerings. Emphasizing his optimism on the strategic direction of the bank, Chairman of the Board, Mallam Falalu Bello observed that a careful implementation of the Strategy would translate in the shortest possible time, to better customer experience, efficient and effective operations and posting of competitive returns on investment for the

stakeholders. “Our new strategy digs very deep into Mainstreet’s business potentials and capabilities and maps out ways to optimally deploy them for market leadership”, Mallam Falalu Bello assured. Reiterating the importance of the bank’s new strategic direction, the Group Managing Director/CEO of Mainstreet Bank, Faith Tuedor-Matthews expressed confidence in the new focus of the bank. According to her, “We have set ambitious but attainable business goals for ourselves. The Board and Management are committed to giving Mainstreet Bank a stronger foothold in the market with a stricter adherence to best business practices, operational excellence and other turn around benefits”.

The Group Managing Director further pointed out that Mainstreet Bank has many numerous strength that have placed it in a vantage position for success. “ We have over 220 branches that are evenly spread out across the length and breadth of this country and a large customer base that remains loyal to us,” TuedorMatthews observed pointing out that the bank was presently repositioning its business to meet the expectations of all stakeholders. It would be recalled that Mainstreet bank recently announced a plan to reorganize its business for efficiency and greater nimbleness, giving a window of opportunity to staff who had attained the retirement age to voluntarily retire from the bank.

BRIEF IMF predicts 8% growth for China

ith global demand slowing and heightened risks, particularly from Europe, weighing on the world economy, China’s growth rate is expected to moderate in 2012 to around 8 percent from 9.2 percent last year, the International Monetary Fund (IMF) said in its annual health check of the world’s second-largest economy. But First Deputy Managing Director David Lipton said inflation was under control and Beijing had room to support activity in case of a more serious global downturn. China’s growth in 2010 was above 10 percent. He welcomed a decision by the People’s Bank of China to cut interest rates by 0.25 percent, which “confirmed the authorities’ commitment to achieving their macroeconomic objectives in the face of slowing growth and increased downside risks, especially from Europe.” The medium-term priority was to shift China’s economy toward a more consumerbased growth model that also aims to address rising inequalities by promoting more inclusive growth. The IMF team was led by Markus Rodlauer. Lipton made these remarks after joining the final policy discussions in Beijing. He met with Chinese Vice Premier Wang Qishan and held in-depth discussions with People’s Bank of China Governor Zhou Xiaochuan, Finance Minister Xie Xuren, and other senior Chinese officials. “This transformation would substantially boost living standards in China and contribute significantly to strong and balanced global growth,” Lipton told reporters in Beijing. The IMF supported China’s ongoing effort to promote higherquality growth while at the same time fine-tuning macroeconomic policies to help ensure that growth does not slow too much. China’s timely and large economic stimulus in 2009–10 had succeeded in supporting domestic growth, shielding China’s population from the worst of the crisis, and helping the global recovery by providing a needed lift to world demand, he said. “China again has space for a forceful response if necessary,” Lipton added. However, any stimulus should be provided through budgetary measures and geared toward supporting the objective of medium-term rebalancing.

24 — Vanguard, MONDAY, JUNE 11, 2012

Corporate Finance BRIEF IOSCO plans consultation on securitisation regulation BY OLAYEMI FOFAH

he International Or ganization of Securi ties Commissions (IOSCO) said it has published a Consultation Report on Global Developments in Securitization Regulation, aimed at getting comment on policy issues arising from the work of its Task Force on Unregulated Markets and Products (TFUMP) According to a statement by Carlta Vitzthum, spokesperson for IOSCO, the paper which provides background to IOSCO’s work and a snapshot of global securitization activity makes observations about regulatory approaches in jurisdictions covered by the work, outlines and assesses the extent of differences and makes policy recommendation addressing differences in approaches to risk attention and measures improving transparency to standardize disclosure. Commenting on the issue, EdouardVieillefond, Task Force co-Chair and Managing Director of the Autorité des Marchés Financiers (AMF), said, “The consultation paper which follows analysis of regulatory developments in over twenty jurisdictions provides us with an opportunity to work toward greater harmonization in our approach to regulation of this important sector. We look forward to receiving industry views on the measures we propose.” Also speaking, Greg Medcraft, Co-chair of TFUMP and Chairman of the Australian Securities and Investments Commission (ASIC), said, “The consultation paper continues the leading role IOSCO has played in supporting the sustained recovery of securitization markets globally. “It again focuses on the importance of securitization as a market-based source of finance and the role cross border issuances play in deepening markets and supporting growth in the real economy.” Vitzthum further stated that the consultation paper is in response to a request from the Financial Stability Board (FSB) as part of its work to strengthen oversight and regulation of the shadow banking system, as it is based on a survey of member jurisdictions and builds on earlier work undertaken by staff of the US Securities Exchange Commission and the European Commission on developments.

From left: Mrs Folashade Ode, Company Secretary, Senator Ike Nwachukwu, Chairman and Suleiman Yahyah, Vice Chairman, all of Nigerian Aviation Handling Company Plc (NAHCO Aviance) at the 31st Annual General Meeting of the company in Abuja.

CBN proposed code to affect quoted banks PETER EGWUATU with Agency Report

ndications have emerged that the proposed code to regulate banks will likely affect those quoted on the Nigerian Stock Exchange (NSE).

The Central Bank of Nigeria (CBN) says it is working on a code to assist it in regulating activities of commercial banks and this will affect both quoted and unquoted banks. Mr Sola Awoyungbo, the CBN Director for Financial Policy and Regulations, disclosed this in an interview with the News Agency of

Nigeria (NAN) last week in Lagos. He said that the code would define the calibre of people who would be on the board of commercial banks in Nigeria. “We want to promote the independence of those on the board of banks. We must have independent directors on the board of banks. They should

not be shareholders. “They should be people who are independent in their opinions. They must, however, have relevant experience. “We want the appointment of people of integrity because they are expected to monitor the activities of the management on behalf of the shareholders,” he said. According to Awoyungbo, the code, which will be ready soon, will highlight the required qualifications and experiences of intending bank directors. Awoyungba said that the apex bank was also working to reduce the stringent conditions given to customers who wanted to open accounts with commercial banks. “The CBN is working on third party identification for bank customers who engage in minimal transactions in commercial banks. “Since they aren’t operating high volume transactions, they do not expose the banks to high risks. “These people can be identified by a clergy or somebody who is well respected in the society. This will guarantee financial inclusion for people in this category,” he said. He said that the CBN was also working on creating a platform that would enlighten the public on the kind of services to expect from banks. “We are reviewing the guidelines for banking services. We want to articulate these services through radio jingles, newspaper adverts and road shows. “This will create awareness in the public about their roles, responsibilities and expectations from banks. It will also minimise the friction between the banks and their customers,” Awoyungbo said.

ASL decries competition, plans diversification to non-aviation sector …proposes 20 kobo dividend NKIRUKA NNOROM

irline Services and Logistics Plc has disclosed plans to diversify its operations into non-aviation sectors of the economy due to increasing competition in in-flight catering services. Making the plans known in the company’s yearly meeting in Lagos, the Managing Director, Mr. Richard Akerele, said the decision to veer into other sectors was informed by anticipated entry of a foreign firm into aviation catering business, saying that it might eventually affect the company ’s overall performance. Akerele, who informed that the strategy will take effect in

2013, observed that the move has had significant impact on its resources, resulting in increased costs over the years. He said, “Your company has now made an in-road into nonaviation sector and is poised to take off in the coming year. This is especially relevant with the imminent entry into the market of a major international player, “Servair”. It has commenced the construction of its facility in Lagos and should commence operation in the last quarter of 2012. In order to counter losses in revenue from customers moving to Servair, management is exploring opportunities in catering for schools and Government owned hospitals in Lagos State. Negotiations are on-

going in this regard and this initiative, if successful, will have significant positive impact on your company ’s revenue and reduce any adverse effect of a new player in the aviation sector.” Though he said that the move has not been easy due to the cumbersome and very slow nature of development in the economy in one hand, and extensive evaluation process in the oil sector on the other hand, he noted, “Our high standard of hygiene, industrial know-how and experience will stand to our advantage in both the education and health sector. In addition, we are very much involved in discussion to provide cold chain logistics for food industry, thus taking advantage of our unique

position at the airport.” The ASL boss stated that already, the company has commenced supply of portable water to airlines flying into Nigeria, adding that it has completed development of first class international standard business class lounge, a new eatery in the departure hall, while renovation works on a new business class smoking lounge is on-going. Speaking at the meeting, a shareholder, Mr.Lazar us Onwuka, said there was need to strengthen the marketing department in readiness for the anticipated competition from the foreign firm. He said that a situation where the company’s turnover has been stagnated over a period of five years was calls for concern, saying that competition might further erode its bottom-line. The company recorded turnover of N3.599 billion, one per cent reduction over N3.562 billion reported in 2010.

Vanguard, MONDAY, JUNE 11, 2012 — 25

Corporate Finance NAHCO Aviance increases authorised capital, eyes African expansion BY MICHAEL EBOH Nigerian Aviation Handling Company Plc, NAHCO Aviance, has announced plans to expand its operations to other parts of the African continent. To actualize this, shareholders of the company gave the management the goahead to shore up its capital base to N3 billion. The shareholders at the 31st Annual General Meeting of the company in Abuja, authorised the Board of Directors to increase the authorized share capital of the company from N1.5 billion to N3 billion. The Board of the company had proposed the increase, saying it will aid the proposed expansion of the

company’s business to other parts of Africa. The shareholders, after considering the achievements of the company in the last one year and its diversification drive, considered it necessary to increase the authorized capital. The company’s shareholders also approved the final payment of 25 kobo per share and declaration of a bonus of one ordinary share for every five ordinary shares. The company also announced that its Chairman, Senator Ike Nwachukwu, will retire before the end of the year and would be replaced by the Vice Chairman, Alhaji Suleiman Yahyah. According to the company, Nwachukwu

joined the Board of the company in 2008, as a representative of the Rosehill Group, an indigenous company that has 9.5 per cent stake in the organization, while he was elected Chairman at the 29 th AGM held in Ibadan in May 2010. On becoming the Chairman, the company stated that Nwachukwu promised to turn around the company in two years, adding that in July 2010, he initiated a re-organisation programme which led to the recruitment of professionals to man strategic offices of the company, equipment renewal and training of staff. Among his achievements, the company stated, includes the

From left: Florence Essien, Dealer Specialist, Lagos-South Region, Etisalat Nigeria; Olujinmi Tella, Head, Regional Sales, Lagos/South West Region, Etisalat Nigeria; Ndukauba Chukwu, one of the winners in the Top Best Distribution Partners category at the Etisalat Heroes Award and Emmanuel Ilori, Regional Distribution Manager, LagosSouth Region, Etisalat Nigeria at the presentation of a Toyota Land Cruiser, Prado (SUV) to Chukwu in Lagos.

ARM Research assigns buy rating on Fidelity Bank’s shares

group of analysts at ARM Research, an independent research and equity firm, has assigned buy rating on shares of

By NKIRUKA NNOROM

Fidelity Bank Plc, saying that they had to revise the estimate upwards based on performance surprises by the bank. They observed that the rating was underpinned by the significant upside potentials of the bank’s financials supported by attractive valuations, adding that share price would likely hit N3.28 by year end. By this rating, investors are required to increase their patronage of the stock except on portfolio realignment consideration. “Fidelity Bank reported gross earnings of N22.4 billion for 3 months ended March 2012; a 46 per cent Yearon-Year, YoY, growth. PBT and PAT rose 140 per cent and 137 per cent YoY, respectively to N4.2 billion and N3.4 billion. Topline growth was driven by interest income. In line with industry trend in first quarter of 2012, Fidelity bank reported robust top-line performance which largely reflects significantly higher interest rates during the quarter compared to the corresponding period in 2011. Interest income rose 76 per cent YoY to N17.6 billion in tandem with 40 per cent loan growth and over ten-fold increment in investment securities YoY,” said the report by the analysts. They further stated, “We estimate, CAR at 35 per cent, which is more than sufficient to drive growth in the medium term, in our view, but have tempered our expectations for risk asset creation in the near term in view of heightened competition in the industry and

elevated money market yields. “We expect interest income to remain the main driver of revenue growth and have revised our gross earnings estimates higher to N90 billion for full year, 2012, to account for the stronger run-rate in quarter one figures, driven by higher asset yields (13.4 per cent) than we expected (9.5 per cent).” The analysts noted that the recent rapid improvement in cost-toincome ratio may have captured most of the benefits from costcutting initiatives, saying that it is expected that the current levels of 65 per cent may persist over the forecast horizon. “Our expectations for provisioning are similarly benign over our forecast horizon; driven by similar factors for the current year and we expect cost of risk to remain stable at ~2 per cent,” the report added. The analysts stated that based on recent branch expansion drive, the bank will be able to sustain its deposit growth, saying that branch network expansion is expected to be the main driver of balance sheet growth going forward. “Furthermore, in line with Fidelity’s resurgent risk appetite, having systemically reduced NPLs over the course of the last two years, we expect loan deposit ratio will recover to historical four-year average over our forecast horizon. We expect some recovery in the contribution of noninterest income with increasing throughput from Fidelity’s larger branch network,” it further stated.

26 —Vanguard, MONDAY, JUNE 11, 2012

Stock Market

Share value on NSE depreciates by N338.34bn BY MICHAEL EBOH & CHINEDU IBEABUCHI

quities’ value on the Nigerian Stock Exchange, NSE, represented by the market capitalization, dipped last week by N338.339 billion. The capitalization which opened the week at N7.005 trillion shed 4.83 per cent to close the week at N6.666 trillion. The All-share index also dipped by 1,060.92 basis points or 4.83 per cent to close the week at 20,902.95 points from 21,114.64 points at which it opened. The decline in the market indices was driven by losses on the prices of major blue chip companies, led by Dangote Cement Plc, with a share price depreciation of 9.12 per cent or N10.24 to close the week at N102.01 per share; Nigerian Breweries Plc followed with a depreciation of 8.57 per cent or N9 to close at N96 per share and Julius Berger Nigeria Plc dipped by N3.93 to close at N29.08 per share. Other share price losers include: UAC Nigeria Plc N3.40, Ashaka Cement Plc N1.63, Conoil Plc N1.27, Oando Plc N1.04, Access Bank Plc N0.86, Chemical and Allied Products Plc N0.85 and First Bank of Nigeria Plc N0.70 among others. Conversely, Guinness Nigeria Plc led 21 other companies on the price gainers’ category, with a share price appreciation of 2.24 per cent or N5.01 to close the week at N229 per share; Lafarge Wapco Cement Plc followed with a share price gain of N0.81 or 1.97 per cent to close at N42.01 per share and University Press Plc garnered N0.61 to close at N4.60 per share. Other share price gainers in the week under review include: May & Baker Nigeria Plc N0.37, National Salt Company Nigeria Plc N0.31, PZ Cussons Nigeria Plc N0.30, Transnational Corporation of Nigeria Plc N0.24, Rt. Briscoe Plc N0.21, Japaul Oil and Maritime Services Plc N0.15 and Neimeth International Pharmaceuticals Plc N0.12 among others. Equities trading dipped by 12.14 per cent as investors exchanged 1.143 billion shares valued at N8.861 billion in 18,880 deals, in contrast to the previous week’s turnover of 1.301 billion shares valued at N9.46 billion exchanged in 14,792 deals.

The Financial Services sector recorded the highest transaction in the sectorial analysis, accounting for 73.58 per cent of the market turnover, with 840.921 million shares valued at N6.157 billion in 11,038 deals. The Conglomerates Sector followed, accounting for 10.06 per cent of the market turnover with 114.532 million shares valued at N256.813 million in 1,014 deals. The Banking sub-sector in the Financial Services sector enjoyed the most patronage, trading 700.158 million shares valued at N6.074 billion in 10,559 deals; representing 61.24 per cent of the total market turnover. Transaction in the Banking subsector was driven by First Bank of

Nigeria Plc., Zenith Bank Plc and Guaranty Trust Bank Plc. Trading in the shares of the three banks accounted for 391.553 million shares, representing 55.92 per cent, 46.56 per cent and 34.28 per cent of the turnover recorded by the sector, sub-sector and total equities turnover for the week, respectively.

Regency Alliance records 13% profit Regency Alliance Insurance Plc has announced a profit after tax of N262.816 million for its 2011 audited financial statements. According to the results for the year end, December 31, 2011, presented to the Nigerian Stock Exchange, NSE, its after-tax profit rose by 12.79 per cent from N233.017 million recorded in its 2010 financial year. The company recorded Direct Premium of N2.413 billion, rising by 17.31 per cent from N2.057 billion in 2010. The company recorded Net assets of 4.854 billion, up from N4.733 billion recorded in 2010.

0.91

1.01 5.52 0.97 6.43 33.31

33.01 8.69

Livestock/Animal Specialities Livestock Feeds Plc

CONGLOMERATES Diversified Industries A.G. Levents Nigeria Plc SCOA Nigeria Plc Transnational Corporation Chellarams Plc UACN Plc

CONSTRUCTION/REAL ESTATE Non-Building/Heavy Construction Julius Berger Nig Plc Roads Nigeria Plc

6.09 3.85 59.07 2.10 4.20 0.50

15.50 425.00

11.10 36.19 3.28 2.88

24.20 29.00

6.89 0.64 0.57 2.63 11.25 1.27 0.50 11.50 4.60 15.19 1.07 0.70 1.15 2.92 0.88 6.19 1.14 4.00 3.55 0.54 0.50 13.45

0.50 0.75 0.50 0.50 0.50 1.70 0.50 0.61 0.50 1.56 0.50 0.52 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50

0.50 0.50

0.50 2.02 0.50

Food Products Dangote Flour Mills Plc Dangote Sugar Refinery Plc Flour Mills Nigeria Plc Honeywell Flour Mill Plc National Salt Co. Nig Plc UTC Nigeria Plc

Food Products-- Diversified Cadbury Nigeria Plc Nestle Nigeria Plc

Household Durables Beta Glass Co Plc Nigerian Enamelware Plc Vitafoam Nig. Plc Vono Products Plc

Personal/Household Products PZ Cussons Nigeria Plc Unilever Nigeria Plc

FINANCIAL SERVICES Banking Access Bank Plc Afribank Nigeria Plc Bank PHB Plc Diamond Bank Nigeria Plc Ecobank TRANSNATIONAL INCORPORATION Fidelity Bank Plc FinBank Plc First Bank of Nig. Plc First City Monument Bank Plc Guaranty Trust Bank Plc NPF Micro-Finance Bank Plc Intercontinental Bank Plc Oceanic Bank International Plc Skye Bank Plc Spring Bank Plc Stanbic IBTC Bank Plc Sterling Bank Plc UBA Plc Union Bank Nig. Plc Unity Bank Plc Wema Bank Plc Zenith Bank Plc

Insurance Carriers, Brokers and Sector AIICO Insurance Plc Continental Reinsurance Plc African Alliance Insurance Cornerstone Insurance Comp Consolidated Hallmark Insurance Custodian and Allied Insurance Plc Equity Assurance Plc Goldlink Insurance Plc Great (Nig) Insurance Plc Guaranty Trust Assurance Plc Guinea Insurance Plc Intercontinental Wapic Insurance Plc International Energy Insurance Plc Investment and Allied Assurance LASACO Assurance Plc Law Union & Rock Insurance Plc Linkage Assurance Plc Mutual Benefits Assurance Plc NEM Insurance Co. (Nig) Ltd Niger Insurance Co. Plc OASIS Insurance Plc. Prestige Assurance Co. Plc Regency Alliance Insurance Sovereign Trust Insurance Staco Insurance Plc Standard Alliance Insurance UNIC Insurance Plc Universal Insurance Plc

Mortgage Carrier, Broker and Sector Aso Savings and Loans Plc Resort Savings & Loans Plc

Other Financial Institutions Crusader (Nigeria) Plc Deap Capital Management & Trust Plc Royal Exchange Assurance

7.77

41.70

Beverages-Non-Alcoholic 7-UP Bottling Company Plc

HEALTHCARE Medical Supplies Morison Industries Plc Healthcare Providers

0.50

3.29 223.99 5.84 105.00 0.89

Beverages-Brewers/Distillers Champion Breweries Plc Guinness Nigeria Plc International Breweries Plc Nigerian Brew Plc Premier Breweries Plc

100.00

Real Estate Investment Trusts Skye Shelter Funds CONSUMER GOODS Automobile/Auto Parts DN Tyres & Rubber Plc

11.13

0.50 30.00 14.79

1st fTier Securities AGRICULTURE Crop Production FTN Cocoa Processors Plc Okomu Oil Palm Plc Presco Plc

Real Estate Development UACN Property Development

0.50

Opening Price (N)

Oil and Gas and Products Petroleum Products Capital Oil Plc

Company

Capital Market

7.77

0.50 2.02 0.50

0.50 0.50

0.50 0.71 0.50 0.50 0.50 1.61 0.50 0.64 0.50 1.55 0.50 0.58 0.50 0.50 0.50 0.52 0.50 0.50 0.50 0.50 0.50 0.52 0.50 0.50 0.50 0.50 0.50 0.50

6.03 0.64 0.55 2.43 10.82 1.26 0.50 10.80 3.36 15.01 1.07 0.70 1.15 2.81 0.88 6.05 1.10 3.68 3.75 0.50 0.50 13.50

24.50 29.30

11.10 36.19 3.29 2.88

15.35 425.00

5.89 3.58 59.11 2.10 4.51 0.50

41.70

3.29 229.00 5.84 9400 0.89

0.50

100.00

10.58

29.08 8.69

1.01 5.52 1.21 6.43 29.91

1.01

0.50 30.00 14.75

0.50

Closing Price (N)

250

27,500 5,800 4,375,818

100,000 300,000

16,500 585,000 5,000 151,000 20,000 1,104,250 3,800 1,090,000 10,400 6,431,272 3,500 2,982,900 96,166 1,670,890 200 143,351 200 4,700 225,000 100,000 1,000 3,500 13,750,000 1,900 10,000 130 4,266 115,500

28,755,939 646,608 146,538,502 7,753,003 2,254,080 6,550,367 1,000 21,423,190 1,108,942 17,173,532 56,000 73,200 91,000 13,340,906 1,006,032 2,821,206 5,939,470 7,351,317 982,927 5,610,089 28,977 50,387,919

134,483 353,111

100 1,200 245,000 800

90,580 53,672

402,464 6,499,289 314,119 399,280 394,800 28,005

9,430

104,948 722,924 2,252 943,548 50,000

10,000

1,500

534,000

131,484 309

39,950 355 15,333,167 250 1,522,207

1,782,804

165,000 17,709 78,177

205,000

Quantity Traded

10.54

0.61 2.02 0.66

0.50 0.50

1.06 1.20 0.50 0.50 0.50 3.51 0.50 0.69 0.50 0.95 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.90 0.50 2.50 0.50 0.50 0.50 0.50 0.50 0.50

11.10 3.39 2.30 9.27 4.30 3.20 9.50 16.12 8.30 20.50 1.78 1.78 13.50 10.17 2.18 11.38 2.91 11.70 5.38 1.92 1.75 16.70

43.50 31.25

15.58 42.66 6.75 3.67

29.20 470.00

19.90 16.20 95.00 6.60 6.70 0.88

51.49

9.52

0.50 2.02 0.50

0.50 0.50

0.50 0.85 0.50 0.50 0.50 2.00 0.50 0.50 0.50 0.95 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 1.90 0.50 0.50 0.50 0.50 0.50 0.50

4.26 0.64 0.53 2.05 1.65 1.20 0.00 7.95 3.60 11.64 0.00 0.87 0.00 3.90 0.73 6.30 0.95 2.17 1.96 0.50 0.52 11.45

27.00 22.56

12.71 36.19 4.78 2.66

10.17 367.83

4.31 4.02 57.00 2.31 3.80 0.50

39.00

2.23 186.00 5.23 72.50 0.93

4.63

0.50

97.00

11.59

32.96 3.01

1.45 5.52 0.50 6.43 28.70

0.48

0.50 14.53 6.40

Year Low

255.00 7.10 100.00 1.01

0.50

100.00

20.15

62.26 8.28

2.54 8.28 1.82 7.60 42.50

0.66

0.64 24.58 8.30

Year High

0.00

0.00 0.00 0.03

0.00 0.00

0.09 0.10 0.00 0.00 0.06 0.43 0.00 0.00 0.00 0.08 0.00 0.00 0.00 0.02 0.06 0.10 0.00 0.10 0.36 0.01 0.01 0.14 0.03 0.07 0.00 0.00 0.00 0.00

0.80 0.00 0.00 0.00 0.28 0.22 0.00 1.34 0.69 1.61 0.00 0.18 0.00 0.85 0.50 0.54 0.22 0.13 7.59 0.11 1.34 1.57

1.29 1.32

3.90 1.61 0.70 0.00

0.28 15.94

0.54 0.71 4.50 0.26 0.73 0.06

3.70

12.12 0.35 4.50 0.00

0.00

11.75

1.66

3.26 3.66

0.28 0.35 0.22 0.31 7.03

0.04

0.01 7.94 1.80

E.P.S.

0.00

0.00 0.00 16.67

0.00 0.00

5.56 10.20 0.00 0.00 8.33 4.88 0.00 0.00 0.00 17.25 0.00 0.00 0.00 25.00 8.33 5.00 0.00 5.00 1.39 50.00 50.00 6.43 16.67 7.14 0.00 0.00 0.00 0.00

5.83 0.00 0.00 0.00 25.91 6.68 0.00 6.96 6.20 8.74 0.00 5.44 0.00 5.07 5.44 14.81 4.68 19.23 0.28 4.82 0.43 7.83

20.93 20.46

3.26 22.48 7.34 0.00

37.57 27.96

16.91 14.38 16.89 16.92 5.75 8.83

13.92

19.98 16.29 22.22 0.00

0.00

8.51

7.33

10.11 2.26

5.18 15.77 3.64 20.74 4.14

15.00

50.00 2.77 4.37

P.E. Ratio

10.60 0.50

Metals Aluminium Extrusion Ind Plc Non-Metalic Mineral Mining Multiverse Plc

00.50

Hospitality Tantalisers Plc

Afromedia Plc

1.60 6.00

Transport-Related Services Airline Services and Logistics Plc Nigerian Aviation Handling Company

0.50

Road Transportation Associated Bus Company Plc

4.90

1.90 2.53 4.20 3.99

Printing & Publishing. Academy Press Plc Learn Africa Plc Longman Nigeria Plc University Press

Speciality Interlinked Technologies Plc

0.50

6.78 1.19

0.50

2.79

1.97 1.17

Media/Entertainment Daar Communications Plc

Hotels/Lodging Capital Hotel Ikeja Hotel Plc

Courier/Freight/Delivery Red Star Express Plc Employment Solutions C & I LEASING PLC

Automobile/Auto Part Retailers Incar Nig. Plc RT Briscoe Plc

0.50

20.50 0.50 25.46 2.91 10.98 132.90 36.50 132.01

Petroleum and Petroleum Products African Petroleum Plc Beco Petroleum Plc Conoil Eterna Oil and Gas Plc Forte Oil Nig Plc Mobil Oil Nigeria Plc MRS Oil Nigeria Plc Total Nigeria Plc

SERVICES

0.64 16.06

Intergrated Oil and Gas Services Oando Plc

3.98 12.71 13.28 4.30 1.05 2.92 0.63

OIL AND GAS Energy Equipment and Services Japaul Oil & Maritime Service

1.44 0.50

INDUSTRIAL GOODS Packaging/Containers Abplast Products Plc Beta Glass Co. Plc Greif Nigeria Plc Nampak Nigeria Plc Poly Products (Nig) Plc Studio Press (Nig) Plc W.A. Glass Ind. Plc

1.45 0.50

Electronic and Electrical Products Cutix Plc Nigerian Wire & Cable Plc Mortgage Carriers, Brokers and Se Abbey Building Society Plc Union Homes Savings and Loans

0.50

Processing Sysetms Chams Nigeria Plc

1.38

6.00

Paper/Forest Products Thomas Wyatt Nig. Plc

8.26

NATURAL RESOURCES Chemicals BOC Gases Plc

3.79 2.00

10.50 9.55 25.35 5.41 112.25 0.50 0.71 42.34 3.25 1.15 10.93

Tools and Machinery Nigerian Ropes Plc

Packaging/Containers Avon Crowncaps & Container Nigerian Bags Manufacturing Company

INDUSTRIAL GOODS Building Materials Ashaka Cement Plc Berger Paints Plc CAP Plc Cement Co. of Northern Nig. Plc Dangote Cement Plc First Aluminium Nigeria Plc DN Meyer Plc Lafarge WAPCO Plc Portland Paints & Products Nig Plc Paints & Coatings Manufacturers Premier Paints Plc

0.50

Computers and Peripherals Omatek Ventures Plc

ICT Telecommunications Starcomms Plc

0.50

ICT Computer Based Systems108 Courteville Investment Plc

13.80 2.66

5.05 0.50 0.88 21.00 1.41 0.60 8.59 3.50

IT Services NCR (Nig) Plc Tripple Gee and Company Plc

0.50

Opening Price N Union Diagnostics & Clinicals Services Pharmaceuticals Ekocorp Plc Evans Medical Plc Fidson Healthcare Plc Glaxo Smithkline Consumer Nig May & Baker Nigeria Plc Neimeth International Pharm Nigeria-German Chemicals Plc Pharma-Deko Plc

1.60 6.01

4.90

0.50

1.81 2.29 4.20 4.60

0.50

6.78 1.10

0.50

2.80

1.97 1.38

0.50

20.50 0.50 24.19 2.92 10.44 132.90 36.50 132.01

15.02

0.79

3.98 12.71 13.28 4.30 1.05 2.78 0.6

1.44 0.50

1.20 0.50

0.50

1.38

0.50

10.60

6.00

8.26

3.79 2.10

8.57 8.57 24.50 5.12 102.01 0.50 0.65 41.20 3.25 1.15 10.93

0.50

13.12 2.66

0.50

5.05 0.50 0.90 21.00 1.78 0.72 8.59 3.50

0.50

Closing Price N

700,160 525,422

1,000

42,931 673,584 4,322 120,249

163,400

100 275,907

1,200,000

76,500

240 581,189

1,500

2,000

82,191 300 71,125 327,834 175,159 31,798 3,874 12,367

2,366,552

7,276,520

6,888 1,000 100 29,198 200 84,311

2,000 1,000

1,334,984 4,000

300

505

60,957

100

2,000

100

7,000 723,361

679,318 679,318 102,702 177,294 742,326 17 7.746 57,986 163,214 214,000 875

30,000

26,238 750

1,000

16,100

168 71,101 1,456,475 105,287 86,532 230,000 10 100

12,000

Quantity Traded

2.78 11.75

5.15

0.80

8.00 6.82

3.68

0.50

400 2.07

1.64

3.67

4.33 3.65

0.72

600

1.57 6.50

4.90

0.50

4.60 3.60

3.17

0.48

3.00 1.33

0.90

2.65

1.97 1.30

0.51

141.00 63.86 195.50

163.50 2,100 240.00

27.99 0.50 0.50 5.71 3.89

1.87

3.98 12.71 13.97 3.60 1.05 2.92 0.63

1.33 0.50

1.62 2.58

0.50

1.38

0.50

10.70

6.80

8.26

5.94 1.47

12.00 8.10 15.16 4.16 95.00 0.50 1.02 36.58 5.11 0.51 10.93

0.50

3.25 3.25

0.50

5.31 0.70 0.83 23.11 3.61 0.95 0.95 4.28

0.50

Year Low

37.10 0.70 32.60 5.59

78.97

0.97

3.98 15.58 15.03 4.30 1.86 2.92 0.63

1.51 0.99

2.50 2.58

0.50

1.38

0.50

12.39

9.20

8.69

6.91 3.60

30.00 12.57 43.98 15.49 132.51 0.75 3.51 48.05 5.28 3.36 13.40

1.47

9.31 3.59

0.50

0.52

5.31 1.45 3.20 29.65 5.61 1.96 12.91 200

0.50

Year High

0.87

0.51 0.80

0.00

0.00 0.13

0.26

0.00

0.22 0.69

0.08

0.54

0.00 0.16

0.04

13.32 3.32 11.91

4.93 0.00 6.02 0.67

6.95

0.16

0.00 3.90 0.00 1.22 0.17 0.07 0.00

0.05 0.00

0.13 0.00

0.00

0.13

0.93

0.00

0.15 0.19

1.59 1.71 1.76 1.80 8.01 0.00 0.00 1.05 0.36 0.18 0.00

0.00

6.49 0.00

0.04

0.05

0.06 0.00 0.27 2.58 0.21 0.08 0.00 0.00

0.00

E.P.S

4.22 8.75

0.00

0.00 27.69

12.19

0.00

34.09 2.12

11.25

4.91

0.00 8.19

12.75

11.11 19.23 17.07

6.99

7.40 0.00

4.17

6.06

0.00 3.26 0.00 3.52 6.18 41.71 0.00

28.80 0.00

13.15 0.00

0.00

85.77

7.37

0.00

39.60 9.16

7.86 4.97 8.88 2.31 13.17 0.00 0.00 42.86 14.19 2.89 0.00

0.00

1.43 0.00

12.50

10.00

88.50 0.00 3.07 8.88 9.05 14.13 0.00 0.00

0.00

P.E Ratio

Stock Market Report as at Friday, June 8, 2012

Vanguard, MONDAY, JUNE 11, 2012 â&#x20AC;&#x201D; 27

28 — Vanguard, MONDAY, JUNE 11, 2012

Homes & Housing Finance BRIEF Architects task Lagos on mass housing

rchitects in Lagos State have called on the state government to come up with clear and focused policies that would address all knotty areas on the path to mass housing provision. They averred that the issue of mass housing will continue to be a mirage if state government fails to bring together all stakeholders directly and indirectly involved in housing. According to them, the rapid population growth in the state without corresponding accommodation to support the growth has made it pertinent and imperative for urban mass housing to be pursued vigorously via established clear policies and wellfocused actions. This formed part of the communiqué issued after the Lagos Architect Forum 2012 (LAF 2012), which had about 1000 participants drawn from different sectors of Lagos State and different parts of the country in attendance. Participants include professionals in public service, private practice, academia, allied professions and building /construction materials manufacturers and suppliers. The theme of the conference was ‘LAGOS 3.0, Urban Mass Housing and Homes in Lagos’.

FCT to sanction ElRufai’s plot allocations soon

ederal Capital Territory (FCT) Administration is set to sanction allocations of plots of land by the former FCT Minister, Nasir el-Rufai towards the end of his administration in May 2007 which the Senate stopped. FCT minister, Senator Bala Mohammed , said that though there are moral issues begging for answers regarding such plot allocations, “certainly the allocations still stand.” He said about 3,500 plots were allocated within one week which resulted in the Senate raising eyebrows to ask his predecessors not to release the letters of allocation. He said that though some of the cases are in court but that he had appealed to President Goodluck Jonathan to look at the issue sympathetically.

Elegunshi Estate Lekki

Housing finance: Firm to raise N2.5bn via private placement R

EDAN Capital Ltd (RC), an investment arm of the Real Estate Developers Association of Nigeria (REDAN), has concluded plans to raise its capital base from N50 million to N2.5 billion through private placement which is expected to open soon. RC is a finance and capital solutions company incorporated by REDAN over two years ago to enable it deal in businesses which it cannot legally deal in. Chairman of the company, Dr. Chris Ekong, said that the placement will enable the company expand its financial services and also float subsidiaries that will provide essential services such as mortgage banking, construction leasing and bulk sourcing of building materials to property/estate and infrastructure developers. Ekong, who is a former commissioner in Akwa-Ibom State, disclosed this at the company ’s directors and shareholders’ meeting held recently, in Abuja, adding that the placement will target REDAN members and other interested private investors “Our mission is to be in strategic partnership with key stakeholders for harnessing capital resources within and outside Nigeria towards providing quality and affordable housing through

consistent and efficient delivery of superior valueadded services specifically designed to meet the needs of estate and property developers in Nigeria and in the sub-regional Africa. “We deliver superior valueadded services by bridging the gap that exists in accessing finance and by tapping into the huge opportunities and prospects that exist in the property market/mortgage finance in Nigeria. The large volume of

dealings before us has necessitated us to move up from an initial N50 million capital base to N2.5 billion. And with this move, RC will now be able to bring more businesses under its portfolio. “The property market/ mortgage finance sub-sector is the future of the economy, which is capable of stimulating other sectors of the economy if all the challenges are properly addressed considering the population, demand and the

economic capacity of the people,” he stated. General Manager of RC, Mr Olawale Okunade, in his remarks, said the company is discussing with international financial institutions and stakeholders, including Shelter Afrique, for possible investment in RC which according to him will form part of the basis for a meeting with Shelter Afrique in Kigali, Rwanda after their 31st AGM this month.

‘Soil engineering key to curbing building collapse’ design fundamentals,

roper understanding of charasteristics of soil types on which buildings are constructed by engineers and other professionals involved in construction will go a long way in drastically reducing the incidence of building collapse in the country. President, Nigerian Institution of Structural Engineers (NIStructE), Mr. Busola Awojobi, stated this in Lagos, at a technical training course on the application of soil engineering to the design of foundations with particular reference to building foundations, sheet piles in shoreline protection and

jetties, which was organised by NIStructE. He said engineering structures usually collapse because of inadequate understanding of the soil, and declared that such incidence would be reduced drastically if design and construction engineers understood what to do in the design of foundations. Awojobi said that the concern of NIStructE on the loss of lives and property occasioned by the recurrent incidences of collapse of building and other engineering structures prompted the organisation of courses on engineering

beginning with the soil that support entire load of structures. Topics treated at the session included essential subsoil engineering investigations for buildings, sheet piles and jetties; interpretation and practical use of subsoil engineering reports; and practical case of a geotechnical/structural survey and restoration of failed concrete sheet pile and jetty. According to the course coordinator, Mr. OreOluwa Fadayomi, the institution hopes that the course would greatly assist practicing engineers in the public and private sectors to be more efficient in service delivery.

Vanguard, MONDAY, JUNE 11, 2012 — 29

Homes & Housing Finance

Kwara partners dutch firm on N73bn housing development Kwara State government has signed a Memorandum of Understanding (MoU) with Stylotec Concrete Industries of The Netherlands for the construction of 10,000 affordable housing units over the next four years, worth about N73 billion. At the signing ceremony between the state government and the dutch firm in Ilorin, Governor Abdulfatah Ahmed said the technology to be deployed in the development has the capacity to deliver 15 housing units per day. The governor disclosed that the project will cost $450m (N70.65 billion) to deliver the houses while another $15m (N2.35 billion) will be used for the development of necessary infrastructure, bringing the total capital outlay to about N73 billion. Chief Press Secretary to the Governor, Mr. Abdulwahab Oba, in a statement, quoted the governor as saying the projection was achievable due to the new technology that would be employed. According to him, the housing scheme would help in the actualisation of his administration’s Shared Prosperity programme as

clinics would now be built in good time to facilitate 500 metres access to good health care by the residents. “The beauty of the scheme is that the core investors have a window that will ensure that Kwara residents have access to mortgage loans to buy the

houses,” the governor stated. In his remarks at the occasion, President of Stylotec Concrete Industries, Mr. George Lamar, said the projection of 10,000 housing units in four years was achievable because of the modern technology that

would be employed. He said the environment in Kwara State is conducive for the housing initiative because the state government had put in place business-friendly policies.

House built with burnt bricks

Lagos to deliver 50 houses monthly

agos State government has declared that its various housing schemes being developed across that state is expected to deliver 50 new housing units every month. Governor Babatunde Fashola who stated this recently in Lagos, at the commissioning of the first traffic radio station in Nigeria, lamented that mortgages have not been successful in the country due to reasons associated with high cost of fund, land and building materials. “Every month 50 new home owners will emerge through the various housing schemes of government,” he said. Fashola also restated government’s commitment to the State Tenancy Law, which makes it unlawful for a landlord or his agent to demand or receive rent in excess of six months from a sitting tenant. Under the law, it is illegal for any landlord to receive more than a year rent from a new tenant otherwise he will pay a fine of N100,000 or be sentenced to three years imprisonment. It is also unlawful for a tenant to offer to pay more than a year rent even though it gives room for

the two parties to sign a tenancy agreement. The governor said the law was put in place to protect both the landlord and tenant stressing that where a tenant goes against the dictates of the law by clandestinely paying above what the law

stipulates, he will not get any relief from the court. Also speaking at the event, the State Commissioner for Information and Strategy, Mr Lateef Ibirogba, said tax payers money will be used to facilitate single digit interest on mortgage to provide

affordable homes to the ordinary man on the street. He further disclosed that the ongoing construction of the Lagos/Badagry expressway will be speeded up as soon as government secures the right of way and the required fund.

Developer urges FMBN’s N100bn recapitalisation

real estate developer has called on the federal government to fast-track the proposed recapitalisation of Federal Mortgage Bank of Nigeria (FMBN) to the tune of N100 billion in a bid to effectively tackle the housing crisis in the country. Chief Austin Oguejifor, Chief Executive, First Rotech Group, made the call during the flag off of the construction of 850 housing units at the Luxury Place Estate in Abuja, adding that without a vibrant and robust mortgage system

to drive the sector housing delivery will remain a mirage. “Considering the nation’s current deficit of over 16 million houses, the FMBN’s current N2.5 billion capital base was insufficient and cannot make any reasonable impact in tackling the housing challenges confronting Nigeria. “FMBN management should ensure the commencement and process of integration of the informal sector into its National Housing Fund (NHF) using cooperative societies’ structures as is in practice in

other parts of the world. It is expected that under this scheme, Nigerians in the informal sector like the akara seller, bricklayers commercial drivers as well as the road side motor mechanic etc, will have the opportunity to own their residential houses. “It is worrisome that a country like Nigeria cannot house its citizens adequately. There is need for concerted collaboration between the government, private sector and the beneficiaries to reverse the ugly trend in the sector,” he stated.

BRIEF Nigeria poised for fastest construction growth report by Global C o n s t r u c t i o n Perspectives and Oxford Economics has forecasted that in the next ten years, construction growth in Nigeria will be the fastest of all markets. The report says Nigeria remains the market where the fastest growth will happen as it will be the global hotspot from now to 2020 as the nation’s construction growth have risen higher than India’s, which reflects increased wealth. Head of Conference Programmes, The Economist Group, Dougal Thomson, in his introductory remarks at the at “The Economist Conference on Future Cities”, predicted that African population is going to surpass that of China by 2050, citing International Monetary Fund (IMF) projection, which says that African GDP growth at the moment is 5.4 per cent per annum. Thomson, who spoke on ‘The World in 2020: Understanding the Drivers of Change’ however, pointed out that Africans are still struggling to get going, noting that so much money is needed to transform cities in the continent.

US mortgage rates fall to record low verage US rates on 30year and 15-year fixed mortgages fell to fresh record lows for the sixth straight week. Cheap mortgages continue to help boost prospects for home sales this year. Mortgage buyer Freddie Mac says the average rate on the 30-year loan dropped to 3.67 percent. That’s down sharply from 3.75 percent last week and the lowest since long-term mortgages began in the 1950s. The 15-year mortgage, a popular refinancing option, declined to 2.94 percent. That’s down from 2.97 percent last week. Rates on the 30-year loan have been below 4 percent since early December. The low rates are a key reason the housing industry is showing modest signs of a recovery this year. A drop in rates could also provide some help to the economy if more people refinance. When people refinance at lower rates, they pay less interest on their loans and have more money to spend.

30 — Vanguard, MONDAY, JUNE 11, 2012

Insurance BRIEF Expert urges insurers to educate public on compulsory insurance products

r. Yemi Soladoye, an insurance expert has urged insurance operators to engage the public on insurance education on the five compulsory insurance products that were made compulsory by the federal government in 2010. Soladoye said that if the insurance companies are ready to engage in insurance education, people will buy these products and the compulsory insurance may end up forming about 50 or 55 per cent of their annual premium income. He said “In many other countries like in America or UK, it is not that people are taking insurance more than we do in Nigeria, but there is the enforcement of the compulsory insurance there.”

General insurers bounce back

eneral insurers have recorded much stronger net profits for the March quarter compared to the corresponding quarter last year. They reported $1 billion total net profit for the March 2012 quarter, up from $490 million, Australian Prudential Regulation Authority (APRA) figures released on Friday show. Last year ’s result showed the impact of the natural disaster claims from January and Februar y. This year insurers wrote $8.5 billion of gross written premium, compared to $7.9 billion in the corresponding quarter last year. Gross incurred claims were $6.6 billion, compared with $16.5 billion. The drop in claims was spread across most insurance sectors. Public and product liability claims fell from $310 million to $282 million, while professional indemnity claims fell from $246 million to $201 million. Employers’ liability claims dropped from $312 million to $214 million. CTP motor vehicle claims fell from $710 million to $560 million. Brokers also benefitted, with commissions growing from $750 million to $796 million. Insurers continue to wind down their equity holdings. At March 31 last year, they held $2.1 billion in equities, which fell to $1.65 billion this year.

Group President, Skipper Energy, Mr. Jitender Sachdeva (left), Minister of Power, Prof. Bart Nnaji and Indian High Commissioner to Nigeria, Mr. Mahesh Sachdev, at the inauguration of Power Transformer Repairing Plant by GTE Engineering Nigeria Limited, at Ikorodu, Lagos…on Friday

Prestige, Leadway, five others to pay 30% share of Dana's plane crash claims By FAVOUR NNABUGWU

even local insurance companies are to pay their share of 30 per cent claims in the $4.5million insurance premium paid by management of Dana Airline for insurance of the aircraft. The ill fated plane that crashed on Sunday, June 3, 2012, Vanguard investigations revealed that aircraft was insured and had a combined single limit of $350million out of which 30 per cent was retained in the local market led by Prestige Assurance Company and 70 per cent insured overseas through Aon Brokers to insurers in the London market. The insurance account of the airline which was co-insured were shared as follow: Prestige Assurance leading with 8%; Leadway Assurance with 7%; NEM Insurance, 5%; Sterling Assurance, 3%; Continental Reinsurance 3%; Aiico 2% and Standard Alliance 2%. Llyods of London, the group insurer of Dana Airlines, said that it would pay adequate compensations to the families of the victims of last Sunday’s air crash at Iju-Ishaga, a Lagos suburb. Mr Yomi Oshinkoya, the Lloyds Correspondent, disclosed this on Wednesday at a joint news conference addressed by officials of the Lagos State government and Dana Airline. The news conference took place at the Lagos State University Teaching Hospital

(LASUTH), Ikeja, with Mr Ade Ipaye, the Lagos State Attorney-General and Commissioner for Justice, in attendance. Oshinkoya said that compensations would be paid to the victims families, according to aviation standards, adding that people should not be afraid that the accident occurred in

Nigeria. He assured all the families of the victims that the airline was well insured and would live up to its liability bidding in this regard. “The international law and standards stipulate that the sum of 30,000 dollars (N4.6 million) must be paid to each of the victims’ family within the first 30 days of the

accident, as initial payment. “A sealing of 100,000 dollars (N15 million) should be paid to the victims family after they must have completed all the requirements expected of them by the law,” Oshinkoya said. He said that the compensation would be for the passenger families and those on the ground. He explained that the insurer had commissioned a Nigerian surveyor to go to the site and evaluate the values of the buildings and properties damaged. “The surveyor is to make a comprehensive report to the insurer through the airline for them to work out the compensations to be paid to them. Oshinkoya, however, urged family members of the victims to come up with evidence to proof their claims that link them with the deceased. “We will be responsible, as we do not want families of the victims to suffer and their claims would be processed as fast as possible,” he said. Oshinkoya said that when payments would be made, the airline’s insurer would write to individual victim’s families to inform them. Mr Francis Ogboro, representing Dana Airline, denied rumours that the aircraft was faulty before taking off from Abuja. “Dana takes the safety of its aircraft and that of its passengers very seriously,” he said.

IFRS: ‘Unnecessary fines could prompt vote of no confidence on managements By ROSEMARY ONUOHA

s companies gradually transit to the International Financial Reporting Standard, IFRS, as mandated by the regulatory authorities, insurance companies have been charged to maintain high level of professionalism in the discharge of their duties. This is hinged on the fact that the IFRS will compel them to reflect all infractions as well as fines incurred in the course of each financial year in their annual reports. Assistant Director (Inspectorate), Head AML/ CFT Unit of the National Insurance Commission, NAICOM, Mr. Sam Onyeka who gave this charge said that unnecessary infractions and fines could draw the ire of shareholders which could likely lead to a vote of no confidence on the management of any such company. Onyeka said “With IFRS, every fine must reflect in the annual report of companies. And where fines become a bit too high,

shareholders will begin to ask questions and when a company cannot give satisfactory answers to such questions, then trust on such companies will gradually diminish.” Meanwhile companies that are in the habit of releasing their results late may lose out in the scheme of things as the IFRS gets on stream. This is because in the era of IFRS, strategic investors may readily take investment decisions based on financial results that are on hand rather than wait for ones that are not available. NAICOM also warned that once a financial statement is delayed, it has lost its relevance for people that want to make economic decisions from such company. Mr. Cyprian Amadi of the Supervision and Directorate Department of NAICOM therefore tasked underwriters that are in the habit of submitting results late to have a rethink if they don’t want to be left behind in the future. Accordingly, Amadi emphasised early submission of financial results by insurance companies in line

with relevant provisions of the law to the commission early enough. While stressing that the aim for preparing financial statement is defeated when it is not made available to the users when needed, Amadi noted that the objective of financial reports include provision of useful information to a wide range of users in making economic decisions as the financial reports show the results of the stewardship of management, or the accountability of management for the resources entrusted to it. He listed the users of financial statements to include investors, lenders, employees, customers, tax authorities, regulators, creditors and suppliers, as well as the general public. Amadi said, “The closer to year-end that financial statements are issued, the more relevant and reliable the information in them is to be used for making decisions.” Section 26 of the Insurance Act, 2003 prescribes that an insurer must submit audited financial statements and annual returns.

Vanguard, MONDAY, JUNE 11, 2012 — 31

Insurance

From Left: President NEA, Mr. Tope Esan; General Manager Federal Palace Hotel & Casino, Mr. David Kliegl and Marketing Manager Federal Palace Hotel & Casino, Mr. Uche Ogbu at the 7 Annual NEA Nomination Night held at Federal Palace Hotel & Casino.

LASACO reiterates commitment to oil & gas insurance By FAVOUR NNABUGWU

ASACO Assurance has affirmed its commitment to oil and gas industry business in the country with adherence to ethical standards and professionalism. The Executive Director of L ASACO Assurance, Mr. Babajide Wright said that the company as a major player in the oil and gas insurance business has continuously

reinvented the rules to leverage on its potentials. Wright who was speaking in chat on the company’s niche in oil and gas insurance said it is a terrain LASACO prides itself as a formidable player. One major area LASACO does this is through prompt claims settlement. According to him, LASACO pays claims promptly it is a policy the management pay attention to most especially on oil and gas business. International oil companies pay premium as at when due, when claims

materialise we should do so too. Mr Wright said the depth of the company ’s professionalism in handing business most especially in the oil and gas sector has made the firm sand out from it pears, “L ASACO’s involvement extends beyond growth of the company, it also encompasses ways and means of developing the market. It contains technical capacities to develop the industr y. To this end, L ASACO’s has been arrowheads for capacity building and professional

enrichment platforms. Speaking on how the firm intends to maintain it niche in the industry Mr. Wright said LASACO organises trainings and seminars both locally and internationally for middle management and top management staff, Attachment programmes in overseas for staff with international affiliate to get more knowledge of how the business is practiced internationally the firm also encourage in-house research into the portfolio of oil and gas business, also knowledge update on international journals in oil and gas to know current trends. Bearing his mind on what the future holds for oil and gas insurance in Nigeria Mr. Wright said the future is very promising with the advent of oil and gas content development Act 2010, lot of companies have been giving opportunity to make appreciable income. However, he gave an advice for other insurance firms. He said “Insurance companies should be conscious, the business is lucrative, it could be very treacherous if the right arrangements are not made, it affects the company”. He added that “another technical arrangement is that if loss comes and insurance companies are not able to meet it, it can erode confidence replied in Nigerian insurance firms by international oil companies who ordinarily have been averse in the business”.

Zenith Insurance partners ihi-BUPA on new travel insurance products

s part of the drive to meet the growing needs of her teeming customers, Zenith Insurance recently entered into an exclusive partnership with ihi Bupa Denmark, a BUPA (British United Provident Association) company to develop and market new travel insurance products in Nigeria. Tagged ZTIP (Zenith Travel Insurance Plan), this unique product to be underwritten by ihi BUPA and administered in Nigeria solely by Zenith Insurance, will meet not just the travel insurance needs of clients outside Nigeria but also provide personal accident cover while they are still in the country. ZTIP provides both Schengen and Worldwide Plans. The Schengen Travel Insurance Plan is a medical travel insurance that has been designed to fully meet the insurance requirements

for visa issuance (30,000 Euros) by the Schengen embassies in Nigeria. The Medical benefits under this plan are subject to a maximum of 30, 000 Euros. The Worldwide Travel Insurance Plan unlike the Schengen plan offers unlimited medical benefits to the client travelling to all countries worldwide including the Schengen countries. It also offers free travel insurance to children less than two years travelling with an adult. Both plans are accompanied by a free Personal Accident Insurance policy - which provides compensation for insured persons in respect of injury, death or disability (permanent and temporary) resulting from accident at anytime, anywhere in the world including Nigeria. Also, in line with the knack for innovation for which the Zenith brand is known,

Zenith Insurance is offering intending travellers the opportunity to purchase the product (ZTIP) conveniently via the company ’s online portal therefore becoming the first indigenous company to offer travel insurance on an online, real time platform. The product can also be accessed directly from any Zenith Insurance office nationwide. Zenith Insurance has also taken measures to tie the security of the product not to its physical appearance but to real-time electronic features, which are known and agreed with the embassies. This means that although a ZTIP policy is not on special security paper, or have holograms or other physical markings that often necessitate a need to physically collect or deliver the policy, there are known electronic validity and security elements which the

embassies use to verify the policies. This has given real freedom to clients to be able to purchase a genuine travel policy anytime, anywhere. Zenith Insurance is one of Nigeria’s leading financial institutions known for consistent superior performance and driven by the vision to be the best provider of insurance services to its clients. In the financial year ending December 31, 2012, the company grew its gross premium from N4.54 billion to N5.64, representing a 2.4 per cent increase while shareholder funds rose by 7.7 per cent from N8.73 billion. Total assets for the period under review also grew by 6 per cent up from N11.90 billion to N12.62 billion. Zenith Insurance is registered and licensed under the provisions of the Insurance Act 2003 to transact all classes of insurance.

BRIEFS STI proposes 4k dividend

overeign Trust Insurance Plc has set June 21, 2012, as the date for its 17th annual general meeting having been granted approvals for its 2011 annual reports and accounts by the National Insurance Commission, NAICOM, and the Nigerian Stock Exchange, NSE, respectively. The Board of Directors of the company is proposing a dividend of 4k per share for ratification by shareholders at the annual general meeting. It will be recalled that the company paid a dividend of 3k in 2010. In a statement to Vanguard, Head of Corporate Communications/ Brand Management of the company Mr. Segun Bankole said that the performance of the company in 2011 was largely due to the patronage and support the company got from the insuring public and the fact that the management is committed to delivering value for its teeming shareholders across the country. Bankole said the company called for continued patronage from its customers in the years ahead while giving assurance for cuttingedge professional services each time they transact business with the underwriting firm. “The Board and Management of Sovereign Trust Insurance Plc wish to thank every of our customers who have kept faith with us and supported our business through the years and most especially in 2011,” he said.

Shareholders of Continental Re to get 8k dividend

o n t i n e n t a l Reinsurance Plc is proposing a dividend of eight kobo to shareholders for the financial year ended December 31, 2011. According to the audited result of the company for the year in review sent to the Nigerian Stock Exchange, NSE, the register of members of the company will open and close from 9th – 13th of July 2012. The annual general meeting has been slated for 18th July, 2012 while payment of dividend is on the 19th of July, 2012. C M Y K

32 —Vanguard, MONDAY, JUNE 11, 2012

Vanguard, MONDAY, JUNE 11, 2012 — 33

34 — Vanguard, MONDAY, JUNE 11, 2012

Tax Platform

National Tax policy guidelines and rules (6) S

•Ifueko Omoigui-Okauru Ministry of Finance The SMF and the relevant Government agency, which will administer the tax shall seek recommendations from the relevant stakeholders to ensure that enactments are regularly reviewed and substantially meet the principles of good taxation and the objectives of Nigeria’s tax system as stated in this document. The SMF shall partner with the Federal Ministry of Finance and other State and Local Government agencies to ensure the development of Nigeria’s tax system and a tax culture amongst Nigerian citizens. The SMF shall in this role, work closely with the State Board of Internal Revenue as well as the Federal Inland Revenue Service and the Nigeria Customs Service (in the case of import and excise duties). Support the State Internal Revenue Service, Federal Inland Revenue Service, the Joint Tax Board, and the Nigeria Customs Service (in the case of import and excise duties) as the case may be on all tax administration matters as would complement the efforts of those agencies. Such support shall cover amongst others: Ensuring that taxpayers monies collected are effectively accounted for and judiciously utilised Communicating to the tax payer the use to which tax payer monies are being put

Demonstrating in action and words that the taxpayer is a priority of government and is well appreciated The State Ministry of Education (FME) Shall provide support to the State and Federal Ministry of Finance and the relevant tax and revenue authorities in developing a tax culture amongst Nigerians. The Ministry through its relevant organs shall be responsible for ensuring the inclusion of taxation in the curricula of educational institutions in the State

trict implementation of tax laws including overt and explicit support through referrals of major cases to tax authorities (Federal and State) on a continuous basis and integration of tax “psyche” in the day to day business of government Ensuring proper assessment, collection and prompt remittance of taxes to designated government accounts. Ensuring fiscal compliance of every person that they deal with., Ensuring that every database maintained in government has a compulsory field for the inclusion of the unique taxpayer identification number for every company, enterprise, individual and other registered organisation ,Use of e-payment systems in all transactions inclusive of direct remittance to the accounts of the tax authorities. . Use of technology and related systems in the way business is done - e.g. electronic cash registers, automated land registries, etc and linkage of databases and such systems maintained in government to the Federal and State tax authority databases Ensuring tax is a major consideration in the evaluation process of individuals and organisations such that the lack of payment of taxes is seen as an affront on government and a crime. Ensuring that’ all Tax Clearance Certificates and other tax documents used in government transactions are referred back to’ the relevant revenue authority for authentication The State Ministry of Finance (SMF) Shall have primary responsibility for tax policy matters at the State level, including initiating proposals for amendments to tax laws by the National Assembly (in the case of Federal tax laws) and the State House of Assembly in the case of State and LG tax laws). The SMF shall coordinate all requests from other State Ministries and Agencies relating to fiscal issues as would ensure harmonisation of the fiscal policy issues of the State and Federal government. In this regard, no other State or Local Government Ministry or State or LG Government agency shall have the right to commit the State or Federal government through the signing of agreements, writing of letters, or other communication regarding fiscal policy issues without the authority or consent of the Federal and State

revenue matters affecting the country. It shall support the process of providing accurate and timely information flow to Nigerians on all tax and revenue matters decided at the State Executive level. In this regard, it shall co-operate with the State and Federal Ministry of Finance and the relevant tax and revenue authorities to obtain the required information for dissemination to the public. Local Government Chairmen are Chief Executives at the Local Government level and they would be responsible along with the Local Government Councils for the implementation and enforcement of tax laws at the Local Government level. . They would be responsible for oversight functions on the local government revenue authorities and provide leadership and direction to these authorities. Local Local Government Councils shall be responsible for the collection of revenue at the local government level as provided in the Fourth Schedule to the Nigerian Constitution and the control and regulation of such other matters as they are empowered to. They may also carry out such other functions as may be conferred on them by the State House of Assembly. Government Chairmen shall also be responsible for liaison with the State Ministries of Finance and the State Houses of Assembly with respect to revenue matters, which are

Strict implementation of tax laws including overt and explicit support through referrals of major cases to tax authorities (Federal and State) on a continuous basis and integration of tax “psyche” in the day to day business of government

from primary to tertiary institutions based on a cradle to grave concept. The State Ministry of Information (FMI) Shall provide support to the State and Federal Ministry of Finance and the relevant tax and revenue authorities in carrying out public enlightenment campaigns en tax and

within the jurisdiction of the State or Local Governments. They should also ensure adequate funding and staffing of revenue authorities at the Local Government level. Local Government Chairmen in the State shall ensure there is close co-operation between the local governments on all revenue matters

and ensure eliminate of multiple taxation. With respect to revenue generation, it is expected that the local government councils shall carry out this function in strict adherence and compliance with the relevant legislation as may be enacted by the State House of Assembly. When required the local government councils shall through the local government chairman approach the State Houses of Assembly to enact such laws as may be required for the efficient and effective discharge of their functions. Local government councils shall co-operate amongst themselves to ensure the elimination of multiple taxation at the local government level. In addition, all Local Government (LG) Departments and Agencies are required to provide and share all information that would assist in the accurate assessment and collection of the relevant taxes. This would include amongst others: Having a revenue generation (as distinct from an expenditure) mindset. Strict implementation of tax laws including overt and explicit support through referrals of major cases to tax authorities (Federal and State) on a continuous basis and integration of tax “psyche” in the day to day business of government Ensuring proper assessment, collection and prompt remittance of taxes to designated government accounts. Ensuring fiscal compliance of every person that they deal with Ensuring that every database maintained in government has a compulsory field for the inclusion of the unique taxpayer identification number for every company, enterprise, individual and other registered organisation Use of e-payment systems in all transactions inclusive of direct remittance to the accounts of the tax authorities. Use of technology and related systems in the way business is done - e.g. electronic cash registers, automated land registries, etc and linkage of databases and such systems maintained in government to the Federal and State tax authority databases Ensuring tax is a major consideration in the evaluation process of individuals and organisations such that the lack of payment of taxes is seen as an affront on government and a crime. Ensuring that all Tax Clearance Certificates and other tax documents used in government transactions are referred back to the relevant revenue authority for authentication

Vanguard, MONDAY, JUNE 11, 2012 — 35

“This is what the truth is. Going behind what you hear first. Asking a hundred questions until you make up your own mind on the basis of real evidence.” James A Michener in Hawai.

ames Michener was for years an editor before he became a writer of historical novels; he wrote over 20 books and he is one of my mentors – eve n in death. When in 1994, I first started writing general commentary, the first thing was to find out the cardinal principle of journalism and to apply it at all times to all situations and issues. It still boils down to finding the facts and not being swayed by popular opinions. I am still not a journalist, and will never be, but the issue of Asaba Airport, which to me is still basically an economic matter has driven me to the farthest length in recent times in getting to the bottom of a story. I thank the private

FDI: Our Own Worst Enemy (Asaba Airport As Case Study) – 3 donors who are only interested in the investment opportunities the airport will provide. May be, one day, I will be able to do the same for Uyo and Gombe Airports. These are “gold mines” waiting to be mined. In part two of this series, two text messages received concerning Asaba Airport were published. The first claimed that N40 billion had been spent on the project; the second asked me to go and find out things for myself. That challenge by the second reader was accepted on this page and I went out in search of evidence. First , I virtually “gate-crashed” into a retreat organized by the Delta State Government, in Warri, for its Commissioners, Permanent Secretaries and Special Advisers. I requested for

Asaba Airports and got and appointment to discuss with anybody and everybody who could provide information about the airport. The Governor granted the request on a Saturday and

I was scheduled to arrive Asaba the following Thursday for the official appointment. Unknown to the Governor, I dashed to Lagos Sunday and returned to Asaba on Monday with a retired Airforce pilot friend in tow; he knows a lot about airports having flown into over 300 worldwide. We wanted to conduct our own investigation before the officials took over. We returned to Lagos on Wednesday with independent information; most of which will be shared with our readers. The only parts left out will be those pertaining to security – for obvious reasons. There is probably no media practitioner in Nigeria today who knows more about the airport than me. I even now know a few things the Governor does not know; because the establishment of an international airport induces more economic, social, cultural, environmental and political changes than a feasibility study can capture. At this point let me provide the answer to the questions asked about feasibility study and increased cost. Yes there was a feasibility study when the airport was first conceived as a purely a domestic airport. It was amended when it was decided to scale it up to an international airport. Surely, everybody can understand that when you alter an airport designed to accommodate small aircraft to one which can service the biggest in the world, 747s and Airbuses, the cost of construction must go up. So there was no “economic terrorism” involved –only understandable economics of scale and scope. However, before going into the “heart of the matter”, let me make a few

necessary observations which will assist non-Deltans, as well as Deltans themselves, to understand the state a little bit better. In summary, ethnicity and politics are combining to make cooperation for overall development of the state virtually impossible. The “Pull-Him-Down, PHD” syndrome is probably highest in Delta State than in most states of Nigeria. Thus, assessment of every project, or initiative of government, is filtered through those prisms first making objective appraisals almost impossible. Garibaldi, 1807-1882, the Father of modern Italy was once quoted saying that, “we have created Italy, now we must create Italians”. President Ibrahim Badamasi Babangida, IBB, when creating Delta state should also have announced that “we have created Delta State, now we have to create Deltans”. Few states in Nigeria emulate the Tower of Babel more than those ethnic groups, mainly, Urhobo, Itsekiri, Ijaw, Isoko, Igbo and Ika, in Delta State. Each of them holds primary allegiance to their ethnic group first and to Delta State next. Thus when Babangida’s government selected Asaba as the state capital, a choice allegedly influenced by his wife Maryam, the couple incurred the everlasting enmity of the “real Deltans” – defined as Urhobo, Itsekiri, Ijaw and Isoko. Making matters worse was the fact that oil production in the state takes place mainly in the “real Delta”. As far as they are concerned, their money is being used to develop a part of Delta which really doesn’t belong there. And for years, “real Deltans”, operating

under the belief that the capital will soon be moved to the “real Delta”, refused to move permanently to Asaba. Years later, the feelings are still strong in many quarters that any majour expenditure by Delta State government is a waste of funds. So, irrespective of its merits, the project must be denounced. The Asaba International, yes, it is going to be an International Airport in every sense of the word, is only the latest, but by no means the last project situated in Asaba, which will be subjected to deliberate misinformation and mischief instead of objective analysis. I write as someone who first stepped on Delta soil in 1975 and has conducted corporate and private (weddings, burials, foundation laying ceremonies etc) in virtually all corners of Delta) on at least 300 occasions since then. Only a non-Deltan, ready to go out and find out the truth can objectively comment of Delta; the Deltans themselves are too emotionally involved to be impartial. First of all, it needs to be repeated that the Asaba Airport represents for me a new and viable economic resource to which foreign and domestic investments should be attracted. My first three trips to Asaba, two by air and one by road, were privately funded. There will be more such trips, God spearing my life, because already, over fifty feasible investment projects have been identified on account of the airport. In fact, the investments the airport will attract will dwarf the cost of construction by almost a factor of one to hundred or more. The real cost of the project will soon be addressed, because it was a promise given to investigate and report back to our readers. That has been done and permit me to jump the gun by stating categorically, that the total contract cost is under N30 billion – for an international airport; when a runway in Abuja was awarded for N69 billion. Yet, Nigerians have been fed with figures ranging from N40 billion to N70 billion. Incidentally, none of those peddling those outrageous figures had ever interviewed the Governor of Delta State. I did. And, he told me authoritatively that only N27 billion had been spent; and barring unforeseen problems, the total cost will be less than N30 billion. I challenge anybody to fault that – and provide evidence. NEXT WEEK: All you need to know about Asaba Airport and more…

36 — Vanguard, MONDAY, JUNE 11, 2012

Appointments & Promotions vicahiyoung@yahoo.com

NUPENG names Aberare Acting GS as Okougbo retires

BRIEFS MPB gets new PRO

NEW Public Relations Officer for the Military Pensions Board, Abuja has been appointed. He is Flight Lieutenant Matthias Gboko Tsekaa. Until his present appointment, the new image maker of the Pensions Board was the Acting Command Public Relations Officer at the Training Command, Nigerian Air Force, Kaduna. A statement from the Board in Abuja, said Tsekaa was also the pioneer Public Relations Officer at Air Force Institute of Technology, Kaduna. Tsekaa, a graduate of Public Relations from the Nigerian Institute of Journalism, Lagos and Management (PGD) from Ambrose Ali University, also holds certificates in Creative Writing for the Media and Editing & Proofreading from Public Relations Institute of Southern Africa (PRISA).

NIMN inducts new members

ATIONAL Institute of Marketing of Nigeria, NIMN, has increased with the admission of 93 new members. The new members were admitted as full members and Associate members in the Senior Executive Membership Programme and Executive Membership Programme and Professional stages of the institute respectively. While seven members were inducted as full members, having fulfilled all the requirements of the Senior Executive Membership Programme, 86 others bagged the Associate membership after scaling through the Executive Membership programme hurdles. The institute also used the occasion to honour late Chief Joseph Adediran, the institute’s first Chairman of the Board of Fellows, who passed on few weeks ago, for his outstanding contributions to the development of the marketing practice in Nigeria. Inducting the new members in Lagos, the President of the Institute, Chief Lugard Aimiuwu, President/Council Chairman, charged them to strive to create value since that was the essence of the marketing practice.

left: Chief Audu Ogbeh, Governor Adams Oshiomhole of Edo State; Senator Chris Ngige and Chief Tom Ikimi at a fund-raiser organised for the Governor’s re-election at the Transcorp Hilton Hotel, Abuja, .

Sweet Sensation bags NFIA Award S

WEET Sensation Confectionaries, a Quick Service Restaurant, QSR, has Bagged the maiden edition of the Nigerian Food Industry Awards, NFIA. The company was recognized for quality and excellence in the food industry. According to the organizers of the Awards, the award was to recognize, celebrate and reward innovative individuals and organizations that have demonstrated excellence in the Nigeria Food Industry; thereby ensuring more commitment of stakeholders to having world-class food quality standards and security in Nigeria. The “Nigeria Food Industry Awards” is a consumer choice award initiative of a group of young Nigerians that used an independent research firm to conduct surveys in major Nigerian cities. According to the organizers “this is a unique award in that the winners are determined by

both consumers and a panel of judges made up of highstanding professionals. Another objective of the awards is to create a healthy competition amongst Nigeria food companies; an activity

that will encourage the improvement of food quality, safety, hygiene and services that will ultimately safeguard the health of Nigerians and reduce hunger in the world at large.”

Ibrahim, Halidu-Giwa, others get award

OMPTROLLERGENERAL of Nigeria Prisons Service, NPS, Mr. Zakari Ibrahim and former Chief of Defence, Intelligence and the Group Managing Director/CEO, Abmacsons Group, Major-General Abdulmalik Halidu-Giwa rtd are eminent Nigerians that will get this year ’s edition of Leadtimes Magazine’s award for their contributions for peace and national development. Others are Katsina State Governor, Alhaji Ibrahim Shehu Shema and his Imo State counterpart, Chief Rochas Okorocha, as well as Senator Abiola Jimobi, the Executive Governor of Oyo State are also doubled as recipients and special guests of honour for the event.

The programme which is titled: African Leadership and the War Against Corruptionis billed for June in Abuja. In a statement by the Board Chairman of the Leadtimes Africa Magazine, Professor Buba Mshelia, “these personalities have lived above board in their performance in their various states. They have been able to impact positively on the people of their states; infact they are symbols and apostles of good governance in African Leadership. Mr. Zakari Ibrahim, Comptroller of Nigeria prisons service and General Abdulmalik are as well an example of transparency, accountability, and integrity in their strategic positions of national development.

Farounbi, veteran journalist now Ambassador designate

ETERAN Journalist and ace broadcaster, Dr Yemi Farounbi, has been appointed Nigerian Ambassadordesignate to the Republic of Philippines. The renowned journalist was recently named ambassador designate by the Federal Government. Speaking on his new assignment, he pledged to strengthen economic tie between Nigeria and Philippine as well as create opportunity for foreign investment in Nigeria. Fielding questions from

newsmen after a reception organized for him in Ila Orangun , Osun state by the Managing Director of Federal Road Maintenance Agency, FERMA, Jide Adeniji, Dr Farounbi, said “Firstly, commercial and economic relationship will be my priority ,opening up the market for Nigerian products ,creating a lot of opportunity for foreign direct investment in Nigeria , so that we will be in a position to create jobs , to strengthen our power base , open up our hinterland by rapid hinterland gateway.” “What Nigeria needs most

now is foreign direct investment and the market for its products, adding that he would also work at creating intellectual linkage between the two countries. We are also thinking of intellectual linkages between our academic institution ,and foreign institution ,so that our people can have sabbatical in foreign university , the way it used to be , and some foreigners , also to have their sabbatical in Nigeria university , so that we can bring universe back into the university.”

IGERIA Union of Petroleum and Natural Gas Workers, NUPENG, has appointed Comrade Isaac Aberare as the Acting General Secretary of the Union, following the voluntary retirement of the erstwhile General Secretary, Comrade Elijah Okougbo,. Until the appointment, Comrade Aberare was the Deputy General Secretary (Operations). A statement by Adamson Momoh, Senior Assistant General Secretary (Research and Public. Affairs), said “Comrade Aberare who is a graduate of Public Administration of the Ambrose Alli University, Ekpoma, joined the Union in 1982 and rose through the ranks to the position of Deputy General Secretary.” According to the statement, “Comrade Elijah Okougbo, erstwhile General Secretary of NUPENG voluntarily bowed out of service after 33 years of meritorious service to oil and gas workers. He joined the Union in 1979 and retired on May 31st , 2012. Comrade Okougbo, a trade unionist and Industrial relations graduate from the Premier University of Ibadan, and a man of integrity, had eighteen merit awards and two medals during his period of service.” “He is now back to private life as the Chairman/CEO of Ogo Construction, Industrial and Commercial Services (OCICS) Ltd. and Chairman/ CEO; New Age Consult, Lagos. He has been reappointed as the Industrial Relations Adviser to the President of the Union.”

Vanguard, MONDAY, JUNE 11, 2012 — 37

Agric Business

FAO Food Price Index drops sharply lobal food prices have dropped sharply in May due to generally favourable supplies, growing global economic uncertainties and a

strengthening of the US dollar, FAO said today. The FAO Food Price Index, measuring the monthly change in international prices of a basket of food commodities, fell by four percent in May. It averaged 204 points and was 9 points down from April. This was the lowest level since September 2011 and about 14 percent below its peak in February 2011. ”Crop prices have come down sharply from their peak level but they remain still high and vulnerable due to risks related to weather conditions in the critical growing months ahead,” said FAO’s grain analyst Abdolreza Abbassian. FAO at the same time raised the forecast for world cereal production by 48.5 million tonnes since May, mainly on the expectation of a bumper maize crop in the United States. FAO’s latest forecast for world cereal production in

2012 stands at a record level of 2 419 million tonnes, 3.2 percent up from the 2011 record. The bulk of the increase is expected to originate mainly from maize in the United States amid an early start of the planting season and prevailing favourable growing conditions. As a result, the global coarse grain production is forecast at 1 248 million tonnes, a huge 85 million

tonnes increase from the previous year. However, with planting still to be completed and much of the crop at very early stages of development, the final outcome will depend greatly on weather conditions in the coming months. With the main northern hemisphere rice crops now in the ground in several countries, the forecast of global rice production in 2012 is firmer and

points to a 2.2 percent increase from 2011, to some 490 million tonnes, mostly reflecting larger plantings in Asia. For wheat, latest indications point to a contraction of about 3 percent in production in 2012, to 680 million tonnes, still well above the average of the past five years. The global cereal utilization is forecast to expand by at least 2 percent in 2012/13, to 2 376

million tonnes, with feed utilization growing by 3.8 percent, while food consumption is expected to increase by just over 1 percent, largely keeping pace with world population growth. At the current forecast level, world cereal production would exceed the anticipated utilization in 2012/13 (which has been revised up since last month by 19 million tonnes or 1 percent) and lead to a significant replenishment of world cereal stocks, up 36 million tonnes, or 7 percent, from the previous season.

BATNF reaffirms commitment to enhanced Agribusiness BY PRINCEWILL EKWUJURU & CHINEDU IBEABUCHI

ritish American Tobacco Nigeria Foundation (BATNF) has reaffirmed its commitment to continuously support the agricultural sector in the country as a vital solution to poverty, dwindling economy and unemployment. Speaking at the BusinessDay 2012 Agribusiness and Food Security Summit tagged “Enhancing Agriculture Value

– Chain for Economic Prosperity ” held in Lagos recently, Mr. Gbenga Ibikunle, Executive Director, British American Tobacco Nigeria Foundation (BATNF), said “It is imperative to note that agriculture is undoubtedly instrumental to national development for economic sustainability. It is in this vein that the nation needs to engage in national reorientation, new thinking and new partnerships aimed at projecting and promoting agriculture”. Ibikunle speaking further

said this year ’s agribusiness summit is a transformative initiative focusing largely on growing food security concerns and more importantly about how to unleash the largely untapped potential of the Nigerian agribusiness sector in the area of value chain processes. He added that “the agricultural support fund will spur investment into the agribusiness sector with the ultimate goal of inclusive job creation and promotion of innovative, environmentally sustainable approaches to agriculture value chain.

BATNF belief that employment generation and poverty reduction are directly related informed the decision to collaborate with National Directorate of Employment (NDE) in creating employment opportunities by training indigenes on poultry enterprise management in Ondo State. A three year fish enterprise development project was also implemented in Araga farm settlement at Epe with collaboration from the Department of Fisheries, Lagos State Ministry of Agriculture”.

38 — Vanguard, MONDAY, JUNE 11, 2012

Aviation

L-R, Chairman, Airlines Operators of Nigerian (AON), Dr Steve Mahonwu, Sec. Gen. Capt. Muhammed Joji and Director, Flight Operator, Dana Air, Capt. Oscar Edward Wason at a press conference on crashed Dana Aircraft at the Murtala Muhammed Airport, Ikeja, Lagos Thursday.

Does the age of an aircraft guarantee safety ?

ince the clash of Dana Airline plane on the 3nd of June ,2012, in Lagos killing all the passengers on board and residents of the crashed site, there has been out cry about the ages of planes operated by Airlines in Nigeria. The general believe of most commentators, though most not aviation experts, is that most airlines in Nigeria have in their fleets planes too old to fly. The revelation that the DANA Mcdonnel Douglas 83 that crashed was almost 22 years old further fueled the call that all old planes should be grounded and phased out. But world renowned pilots,aeronautic Engineers, Air Force Generals have maintained that it is not the age of an aircraft that determine its safety but the level of maintenance of the aircraft. Air Marshal Malcolm S D Wollen an Indian Air Force General and war veteran said in an article published in the Indian Express that ‘’ the age of the MiGs is not a real problem as every aircraft is overhauled after a predetermined number of hours. It is accepted for service use only if it fully meets the requirements for brand new planes ‘’ He went further to stress that ‘’the causes for accidents vary for each different type of aircraft, but common causes, as elsewhere in the world, are Human Error and Technical Problems’’. He then said that every aircraft must have essentially materials/ components installed/ supplied that are to specification and dimension, especially for engine, fuel and hydraulic components; and that overhaul/

maintenance procedures must be rigidly observed . No aircraft anywhere in the world can be considered airworthy unless the aforesaid is done. Air Commodore Jasjit Siwas not the age of the plane that caused the accident. Singh further said Technical Defect accidents occur due to interplay of a complex set of factors. Technical defects leading to an accident could be either due to an inherent or an induced problem. The

By LAWANI MIKAIRU

The age of the MiGs is not a real problem as every aircraft is overhauled after a predetermined number of hours. It is accepted for service use only if it fully meets the equirements for brand new planes

primary factors are according to h i m ’ ’ D e s i g n inadequacies, which is i n h e r e n t ; Manufacturing/ Overhaul Quality which is induced. Maintenance which can be ngh ,another Air Force General cautioned in his article that Correspondents should use a lot of restraint while writing on complex technical matters. He cited A-320 accident at Bangalore in 1990 as a case in example where fly-bywire did not help when the pilots failed to manage energy

properly. It induced and Operational Factors which can also be induced’’ He then said that every technical defect accident has to be analyzed and investigated thoroughly so that appropriate remedial measures can be taken. Back home in Nigeria, between 22nd th October, 2005 and 29 October, 2006 within a period of 11 months three major accidents occurred which took the lives of 312 people. These three successive accidents within 12 months period accounts for 72% of the entire 33 years accident history of Nigeria. According to Captain Muhammed Joji ‘’It is worth knowing that in most of these accidents that claimed the lives of over 900 people there was no single structural or components failure of the aircraft. All the accidents were attributed to human factor,—Pilot error except one attempted hijack ‘’ Captain Joji further argued that there is no correlation between safety and the age of an Aircraft. He said the decisions to retire aircraft are basically economic. Ageing aircraft requires more frequent maintenance than new aircraft. Most aviation experts agree that a well maintained old aircraft is better than a poorly maintained new aircraft. New aircraft are often purchased to add capacity to the existing fleet not to immediately replace existing fleet. Therefore imposing a 22 year life span limit on an aircraft, as it has been done by regulatory authorities in Nigeria is not consistence with the ICAO standard and recommended practices. There is need for all not be too emotional when discussing air safety and aircraft.

Vanguard, MONDAY, JUNE 11, 2012 — 39

Media & Advertising

A team waiting for their turn to take on the field of play at the Lagos zonal qualifiers of the Gulder Ultimate Five Aside Football qualifiers held at the NIS, National Stadium, Surulere, Lagos.

Five-Aside soccer: How Gulder is affecting grassroot devt STORIES BY PRINCEWILL EKWUJURU

he sponsorship of Five-Aside football competition by Nigerian Breweries Plc, makers of Gulder larger beer three years ago, chances are that the company never really envisaged the magnitude of success it had achieved. With the deluge of several other football competitions with similar thrust, it was always going to be a challenge to position the Gulder Five-A-Side as a football competition of note. Three years on and the story is one that is surely a delight in the ears of the organizers.

Indeed, if there ever was any doubt as to the popularity of the competition, it was certainly dispelled with the number of football teams that showed interest to be a part of the soccer fiesta. More than 3000 teams registered to compete in the event from all parts of the country. Massive crowds consisting of football teams turned up at the six zones where the qualifiers were played. And the games itself were a testimony to the growing talents that abound in the country as they took to the pitch seeking to outdo each other. So what is the secret formula for Gulder Five-ASide success story? Maybe it

could be the fact that one corporate body is finally taking the issue of grassroots football development seriously. It is a well known fact that football development in the grassroots level does not seem to be top in the priority of Nigerian Football administrators. Though successive administrations, including the present one, has saddled on itself, the responsibility of managing football in the country, nothing significant has come out of its efforts. This is in addition to the whooping sum of monies doled out to the Nigerian Football Association from the FIFA, the international football governing body’s coffers. For

the custodians of the football game in the country, it has been all talk but little known action with respect to developing football. This makes it the more imperative for serious corporate bodies to intevene and help save the dying game of football at the grassroots level via sponsorship of tournaments. With Gulder Five-A-Side joining the fray, more and more of these exciting talents have a platform to showcase their talents. The regional qualifiers for the competition moved across six states of the federation, Benue, Enugu, Delta, Rivers, Ogun and Lagos States with two teams emerging from each of the zones. All of the zones saw various teams coming in from other states to participate in the host states. The tourney would surely serve as an invaluable experience to the aspiring football superstars in their quest for a successful football career. For most of the teams, Gulder Five-A-Side was their biggest football competition in their fledging career. Speaking on the competition, Tony Agenmonmen, Marketing Manager, Lager (lager), Nigerian Breweries Plc., the competition would help budding talents across the country showcase their skills. “What Gulder is doing is giving the fantastic talents we have scattered all over the country an opportunity to display their talents. This tournament will help the budding talents as they strive to become the next world champions in football,” he said.

Beer Market: Goldberg re-entry stirs media war …33, Dubic may re-strategise

he majority stake acquired by Nigerian Breweries (NB) Plc in January 2011 and the supervision of the manufacture of Goldberg beer from Sona Breweries Limited, seems to have breathed a new life into the product and the beer market. The re-launch of the beer in Ibadan, the Oyo state Capital believed to be the stronghold of the product is a sign that the beer is set to consolidate on its hold on the Western region market, particularly now it’s been re-filtered. Before now, the beer had not commanded enough recognition from beer drinkers, all because it was playing regional. But from observation, Goldberg is coming back with the distribution chain frame and network of NB Plc, to

trend the part of the leader beers. Earlier, Goldberg was not visible on the airwaves. It’s unique selling point this time, may go beyond the word of mouth campaign, if going by media plans to be orchestrated by its producers, reason is that the beer has been brewed lighter and crispier. In the next few months, media war will subsist, because the new pride will push for visibility in the market with Below and Above-the –line campaign, and thus will effectively stir media war as other brands in the same category are planning a fight back. According to Al Reis, a brand and Public relations expert had posited that, “ If new product or existing one

(s) is or are re-introduced particularly where it has competitors already in the market, there’s definitely going to be a media plan to push the brand, and older brands will re-strategize to consolidate on their market position.” With the re-introduction of Goldberg, a new battle line has been drawn among equals like 33, Harplime and Dubic, which eventually will boost total media budget for 2012 in the half year result. Simon Adeyemi-Cole, brand consultant toed the line of Al Reis when he said that new products which is playing in the same category of existing brands will call for new wit campaigns. Goldberg, with a distinctive packaging; New crown cork, bottle, labels and improved product quality, at a trade briefing was welcomed with dance and music, amidst

king-like display by the Gold City king and a splendid performance by Wande Coal. And Ace comedian, Seyi Law. To some consumers, Goldberg has been redefined, tastier and smooth and can now be compared to others in the market. That was why Mr. Walter Drenth, Marketing Director, NB said, the beer was an outcome of a painstaking process of refining Goldberg to give it the usual taste of high quality, sequel to its addition to the company ’s brand portfolio following the acquisition of another brewery that hitherto brewed the product. Drenth explained that it took the Nigerian Breweries chief brewer and his technical team over six months of meticulous process of refining the product with a view to bringing value to customers.

BRIEFS

AAAN holds 39th AGM

he Association of Advertising Agencies of Nigeria (AAAN) has concluded plans for its 39th Annual General Meeting/ th Congress scheduled for 28 th through30 June, 2012 in Ibadan, the Oyo State capital.The theme of this year ’s AGM/Congress is “Strategic Marketing Communications & Governance”. According to Mrs. Yinka Ogunde, the Association’s Event Planning Committee Chairman, said the theme of this year’s AGM/Congress is to further provide a professional platform for government at all levels, parastatals and agencies . To stress the importance of this event, the Association is inviting Mr. Jimi Awosika, Managing Director/CEO, Insight-Grey as the keynote speaker. The lead discussants are Mr. Bosun L adele, Commissioner of Information, Oyo State; Mr. Tolu Ogunkoya, past MIPAN President, and Mr. Kola Oyeyemi, ADVAN President. The event will be chaired by Senator Akin Odunsi, a distiguished senior practitioner and Senator of the Federal Republic of Nigeria. The AGM/Congress open on Friday, 29th June, 2012.

FPH & Casino hosts NEA awards nomination

or the second time running, Federal Palace Hotel and Casino is collaborating with the Nigerian Entertainment Awards to sponsor the awards nomination night. The 7th Nigerian Entertainment Awards nomination night saw about 150 celebrities nominated from different categories across the entertainment industry holding in New York City in the United States, US. In the course of the evening, some of the celebrities took their first gaming lessons at the slots machines and poker/ black jack tables and later expressed their joy and excitement at the very relaxing nature of gaming at the hotel. David Kliegl, General Manager, FPH &Casino, said he was delighted at hosting the annual event and it serves, as a means of showing the entertainment industry that the hotel is the entertainment destination of choice where a million thrills is available in one destination. “We will continue to showcase our world class casino as an alternative up-market entertainment destination in Lagos,” he said.

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The role of a weak Naira in Dana air crash

t is now clear that over 150 innocent souls perished last Sunday as a result of the Dana air crash. These unfortunate souls may have since been joined by many more, who have tragically lost their lives nationwide as a result of the inertia in one government agency or the other. Nigerians commiserate with families and friends who have become bereaved as a result of wanton negligence, be it in the air, our roads, our hospitals or indeed, as a result of the laissezfaire indulgence of g o v e r n m e n t ’ s regulators in the aviation, banking, pension, and capital market subsectors. May the souls of these unfortunate fellow Nigerians rest in perfect peace and may the good Lord grant their families and friends the fortitude to carry on. Now, some readers may wonder what a weak naira has got to do with an air crash after all; the regulatory agency, Nigerian Civil Aviation Authority (NCAA) and the operators of Dana Airline have been fingered as villains of this disaster. The NCAA has already been widely castigated for allowing Nigerian airlines to operate with old aircrafts, which, worse still were not strictly subjected to the appropriate schedule of mandatory service checks. In addition, critics have also decried the obsolete airport n a v i g a t i o n a l infrastructure and local facilities for aircraft service and maintenance. Dana Airlines, on the other hand, is accused of running its service

with old planes, which run more schedules than are appropriate for the age of such aircrafts. In response to the current tragedy, the Minister of Aviation has set up a panel of notable experts to look at the maintenance practices of all domestic operators including Dana Airline and the effectiveness of NCAA’s oversight of maintenance practices. The Panel would also examine the management and safety culture of all domestic airlines and thereafter make ‘bold’ recommendations for the improvement of the safety of the Nigerian airspace. Incidentally, these are broadly the same terms of reference of other government panels instituted in the past in response to airline crashes. It is likely that if earlier recommendations of the various panels set up in the last 30 years had been properly considered and implemented; perhaps, Sunday’s tragic loss could have been avoided. However, in view of the historical antecedents, of such investigative/ administrative panels, the likelihood is that the observations of the Aviation Minister’s panel 2012 would ultimately find a place alongside the dusty shelves carrying earlier reports of investigations of similar catastrophes. In the event that the blame for this air disaster has been squarely placed at the doorstep of the airline operators and the related regulatory agency, NCCA, one may ask again, what has a weak naira got to do

with air safety? To answer this question, maybe it would be appropriate to draw from the example of car usage in Nigeria to explain the link between the value of the naira and the quality of our imports. Most graduates from Nigerian universities in the 1970s and early 80s will recall that the car allowances, which they were invariably paid, six months or so, after their employment was largely adequate to purchase brand new (tear rubber) cars of their choice. In addition, most establishments provided allowances that would repay the value of the car loans within three to four years, and thereafter also provide a fresh loan for another new automobile. For this reason, it was unusual to see second-hand car lots in any part of the country. This culture, however, began to rapidly change as the naira value was gradually officially devalued from less than N1=$1 to the current level of N160=$1. Thus, a state of the art 504 GL with leather upholstery, airconditioner, tainted glasses, etc, sold for less than N7,000, while today, that amount cannot even buy one used tyre. A new car of similar quality today, will cost in excess of N7,000,000. In the event that incomes were largely stagnated against the backdrop of a rapidly depreciating naira, it became impossible for most Nigerians to purchase new cars. In response to this reality, the government allowed

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ultimately admitted for importation. In other words, since Nigerians could not afford brand new models, our roads were flooded with those cars, whose usage had become a liability for their owners abroad. God knows how many Nigerians have sadly lost their lives as a result of driving poorly maintained, well used old car imports. Inevitably, as in the auto business, so also it is in the aviation subsector; a new plane, which costs, say, $30 million in 1975 could be bought by a Nigerian air transport operator for less than N25 million. Today, such a plane could cost about N4.5bn, and, if the purchase loan for the aircraft was funded domestically, the airline may have to pay interest at over 20%. In the face of such economic reality, Nigerian airline operators had inevitably traded downwards; with the result that most

aircrafts in our domestic air space have an average age of about 20 years (Arik Air appears to be the main exception). Worse still, the domestic airline operator often finds that the weak value of the naira has similarly affected their incomes, as the abject level of poverty in the country not only reduces the volume of passengers, but also makes it difficult to make premium charges for their tickets. Nonetheless, the airline operators are constrained to pay close to the international dollar benchmark price for their aviation fuel! Consequently, the airline business has become a cutthroat, dogeat-dog enterprise with minimal margins and eternally rising costs. The net product of the above market mix would expectedly be a diligent attempt by operators to reduce cost in every manner. To this end,

they would buy cheap aircrafts that are over 20 years old; delay the service schedule of their planes, and possibly even run an exhaustive schedule so as to get the maximum return on each plane! So far, there is nothing to suggest that the quality of pilots and technical crew flying the Nigerian air space is less than optimal. So, we may safely discount this factor as a major cause of air crashes in Nigeria. This is not to say either that affordability of young age planes would totally eliminate air crashes, but there is no doubt that the rate of such disasters would be minimized if government and the appropriate regulatory agencies also provided state-of-the-art infrastructure and maintain optimal oversight function over the staff and quality of equipment of all airline operators. SAVE THE NAIRA, SAVE NIGERIANS!

importation ‘for sale’ of cars that were not more than five years o l d ! However, a s government’s deliberate n a i r a devaluation continued, this age limit was extended to 10 years a n d subsequently, 15 years old cars w e r e

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