FG can't meet infrastructure needs with N4.99trn spending — SEC DG by Vanguard Media Limited

JULY 1, 2013

FG can't meet infrastructure needs with N4.99trn spending — SEC DG By PETER EGWUATU

HE Federal government cannot finance the infrastructure needed to boost the economy by spending N4.99 trillion without leveraging the capital market, Director General, Securities and Exchange Commission (SEC), Ms Arunma Oteh has said. The commission is also planning to come out with a financial inclusion strategy for the capital market inline with the Financial System Strategy 2020, just as it is working at developing an Islamic finance master plan for the Nigerian capital market. Speaking after the Capital Market

… Financial inclusion for capital market soon … To develop Islamic products Committee (CMC) second quarter meeting in Lagos, weekend, Oteh said, “ The government should leverage the instrument of the capital market to finance the huge infrastructure needed to boost the economy. Quoting a recent economics paper from Goldman Sachs which calculates that,in a sample of 12 African countries, total infrastructure demand over the next four decades will amount

to $1trilion, of which Nigeria alone will need $360billion, Ms Oteh stated that the nation’s current budget of N4.9trillion could only achieve about 20 per cent if it is totally committed to fixing the nation’s infrastructural challenges alone. “The concerns among the capital market community are that we should leverage on the instruments provided by the capital market to fix some of the important infrastructure in the

country. We are going to have a securitisation roundtable with the all the ministers responsible for infrastructure provision” she added. On the planned Islamic finance plan, Oteh stated that the commission is working at developing an Islamic Finance Master Plan for the Nigerian Capital Market. According to the SEC boss, “The plan is that the CMC would work on this initiative and present them at a planned Capital Market Committee retreat scheduled to hold towards the end of the year. It is at that planned retreat that the SEC will endorse this Continues on page 18

120.2

-1.4

2,210.00

+19.00

16.45

-0.02

102.73 -0.09 97.14

+0.09

CURRENCY BUYING CENTRAL

From left: Chairman of the Investment and Securities Tribunal, (IST), Ngozi Chianakwalam, Director General of the SEC and Chairman of the CMC, Arunma Oteh, COO Financial Markets Dealers Quotation, Jack Delaney and the Executive Commissioner, Finance and Administration, SEC, Zakawanu Garba, at the 2nd Quarter Capital Market Committee (CMC) Meeting which took place at the Securities and Exchange Commission’s (SEC) Zonal Office at Victoria Island, Lagos.

DOLLAR POUNDS EURO FRANC YEN CFA WAUA RENMINBI RIYA KRONA SDR

154.75 235.9938 202.4285 164.0865 1.5638 0.2884 231.9598 25.2117 41.2645 27.131 232.744

155.25 236.7563 203.0825 164.6167 1.5688 0.2984 232.7092 25.2936 41.3978 27.2187 233.496

SELLING 155.75 237.5188 203.7366 165.1469 1.5739 0.3084 233.4587 25.3755 41.5311 27.3064 234.248

CBN Exchange rate as at 28/06/2013 C M Y K

18 — Vanguard, MONDAY, JULY 1, 2013

Cover Story

Vocation and technical education – a key to improving Nigeria’s development. Part 2

From left: Divisional Head, Marketing and Corporate Communication, Keystone Bank Plc. Mr. Muhammed Ciroma; Managing Director/CEO, Mr. Phillip Ikeazor and the Executive Director, Mr. Ademola Adewale, during an interactive session with Business Editors in Lagos.

FG can't meet infrastructure needs with N4.99trn spending — SEC DG with the view that they would begin operations starting in January 2014.” She further said that the Islamic instrument would provide opportunity for Nigeria to finance some of the infrastructure needed to revolutionise the economy, adding that “ we must be ready to build a world class capital market despite the challenges. The SEC boss disclosed that the Board of the commission has approved a reorganization structure for the entity aimed at repositioning it for enhanced productivity.

n her words, “ The board has approved changes in the organizational structure of the Commission. The changes are intended to strengthen the SEC and position it to better discharge its mandates. They will better align the SEC to pursue its vision of becoming “one of the leading capital market regulators in the world”, and the Mission of developing and regulating “a capital market that is dynamic, fair, transparent and efficient enough to contribute to the nation’s economic development”. Continuing, she said, “under the new changes, we have new departments, such as Office of the Chief Economist, Market Development, Strategy, Ethics, Procurement and Fixed Income. New Divisions were also created. They are: Litigation, Investor C M Y K

Protection, Investor Outreach, Call Centre, Non-interest Financial Products, Program Management Office, Statistics & Information Resource, Planning & Budget and Operations Infrastructure & Technology. All these are meant to boost the market.” Oteh, also said that the

Continued from page 17

The changes are intended to strengthen SEC and position it to better discharge its mandates

CMC has been mandated to help develop a blue print for the capital market, stressing that it will be capital market master plan for ten years. According to her, the plan will be assessed quarterly. The CMC will also come out with literacy plan strategy where the ordinary people can be able to read and understand the rules of the market. In her review of the performance of the capital market, she said, Nigeria remains amongst the top 10 performing markets in the world. According to her, the performance was driven by

signals notably with what Ben Bernanke said that we are coming to the end of the quantitative easing. “But we also have some issues that could put fiscal pressures on us, which is of course multiple prediction that there won’t be a decline bond or if they are concerned about capacity to maintain the same level of production,” she said. She said Bernanke highlighted the increased participation of domestic investors the Nigerian stock market; signaling that confidence is coming back to our market.

urthermore, Oteh stated that as the nation’s capital market focuses on attaining the $1trillion capitalization target by 2016, it still has a long way to go as the value of the market currently stands at $107billion. The SEC boss, also called on the unquoted corporate entities to get their shares listed with a view to realizing the target. Oteh, who disclosed this while briefing journalists at the end of the CMC meeting said, the commission is working round the clock to woo multinational conglomerates, the power companies as well as the telecommunication companies to list their shares and boost the liquidity in the market. According to her, “We will be very happy if everybody is working towards the $1trillion Continued from page 19

S the Roman Historian, Plutarch (AD 46-120?) had noted “The mind is not a vessel to be filled but a fire to be kindled.” Given their corrupt and greedy lifestyles Nigeria’s leaders do not seem to care about integrity or moral values. They are good at predicting the future without creating it. As Peter Drucker has observed “If you want to predict the future, create it.” In Nigeria, the growing problem of unemployment in the country has contributed largely to the worsening problem of poverty among the populace. Unemployment according to Olaitan (1996) leads to frustration and disillusionment which may result in crime or drug abuse in a futile attempt to escape from and forget the pains and humiliation of poverty and lack. The problem of unemployment, he further stated, has worsened as millions of school leavers and graduates of tertiary institutions have not secured gainful employment over the years. Unemployment has posed a serious problem not only to the welfare of individuals but also to that of their families. Many able bodied and highly qualified persons who could not secure gainful employment have remained economically dependent on their parents. This is because they lack the necessary occupational skills to be self employed and to effectively function in today’s world of work. These occupational skills can be provided by technical and vocational education. According to Abdulahi (1994) technical education is that aspect of education that involves the acquisition of techniques and application of the knowledge of the science for the improvement of man’s surrounding.

echnical and vocational education prepares one for the world of work with which the individual become reliant and can make contributions to the development of the society. As employers look for new talents every year from new graduates, it is important to not only have a solid education but graduates that have features that stand out from the rest of the graduating students. With the economy being more globalized than ever, it is important to have a background and a skill set that allows graduates to become immersed in the global economy right from graduation (Cote, 2007). It is important for these students or graduates to have skills in innovation in technology education and entrepreneurship to be ready to fit into the global market place on which today’s economy depends on. Entrepreneurial Skills Needed by Technical and Vocational Education.

eadership is not a major cause of Nigeria’s under-developed status. Nigeria can become an economic power-house (and realize its visions) only if proper attention is given to education and technological development and promotes and rewards creativity, and channel its material and human resources to productive use. The leaders must recognize the relevance of technical and vocational education in national development and adopt and adapt what works in developed nations. The resources being wasted in the on-going false re-branding campaign should have been used to re-brand the nation’s education sector. No amount of rhetoric (or fanciful slogan) would solve Nigeria’s sociopolitical and economic problems. The leaders could salvage Nigeria’s image by re-branding their mentality and doing the right thing: tackle corruption, reform the electoral system and fix the dilapidated institutions. Thus, without a fundamental shift in values, beliefs and thinking, and without technological capability, Nigeria will continue to dream of becoming a ‘Great Nation’. It cannot be overemphasized that technical education is the engine for economic growth. No nation can fight a war without an army. In the same token Nigeria cannot develop without wellequipped technical and vocational institutions. In fact, it is the missing link in Nigeria’s development policies. Because of poor training and ineffective institutions Nigeria suffers from low productivity. But the progress of any society lies in the productivity of its citizens. Higher productivity gives a nation advantage of economies of scale and lowers the costs of production and prices of goods and services. Nigeria should begin now to take very seriously investment in education and skill training as no nation can compete effectively in the emerging global market place with poorly educated and unskilled workers. The leading factors of production in the emerging global economy are said to be technology, knowledge, creativity and innovation.

Vanguard, MONDAY, JULY 1, 2013 — 19

HEN the founding fathers of Western civilization adopted the capitalist philosophy, they realised that a free market economy is not efficient in resources allocation. They put in place social and economic measures to provide for those who may be left out of market provisions. Economics, generally, is of philosophical interest in three main regards. It raises moral questions concerning welfare, justice and freedom. It raises foundational questions concerning the nature of rationality. Leaders, in making policy and legislation put them through the crucible of the effect such policy will have on the well being of members of society, justice and equity for those to and the elderly. All have to Nigerians must return to their be affected. It is when such depend on their family roots and begin to ask question policies pass the test that they members in the event of about the family background of unexpected. It is the desire to those with sudden wealth. are unveiled to the public. In Yoruba land, no matter your In the practice of democracy make provisions for the future in Nigeria, it is uncertain if and cater for members of the wealth, they still ask, who is policy formulation and the family - immediate and your father? Where are you process of legislation are extended - that many Nigerian coming from? It is not conducted in the manner that civil servants and workers today everybody that can be a Yoruba takes cognisance of impact of steal and bend the rules for leader. The social security such public policy. Every financial gains. If every member provided by the developed economic agent attempts to of the Nigerian society is societies is meant to encourage provide for himself and his assured that no matter the the individual members of the future needs. The fear of the circumstances, the state will society that the state is ready to future has driven many in the take care of them through social provide the basic minimum for face of stiff competition for daily security; many will not steal or needs into their early grave. take bribe. This was not the case Market failure occurs when the in the 1960s, 70s and part of supply of a good or service is 80s. Many civil servants worked insufficient to meet demand. conscientiously in government This results in an inefficient distribution of resources among without joining the rat race for wealth acquisition. At that time, market participants. Under free market conditions, it was fame and integrity that prices are determined almost was the passion. Family names exclusively by the forces of were highly priced and supply and demand. Any shift jealously guarded. It was a in one of these results in a price taboo then to have a member of change that signals a the family go to jail. Such corresponding shift in the other. families were ostracised by their Economic and social community. Sudden wealth was policymakers try to consider the rare. Every member of the them. What is Nigerian market failures that will result society was held accountable government waiting for to look from specific legislation, and, in and there was care for one inward and come up with a most cases, they ultimately another. Family members raised Nigerian social security system attempt to minimise market alarm when a member brings that takes care of the minimum failure by finding a balance in unexplained income. Such needs of the members of the between protecting social or men who defied social order to Nigerian society? What form of political interests and make wealth were never economy is Nigeria even honoured or respected. Today, running? Is it capitalism, maintaining efficient markets. In Nigeria’s political these people are everywhere certainly not? Capitalism is economy, there is no social and they run the lives of the rest about government providing an security for any entity -the of society because the nation enabling environment for the worships money. private sector to become the unemployed, retirees, students now

We can stop corruption engine of growth. It is rooted in free enterprise and freedom of choice. It is about availability of alternatives. It is not in the place of government to dominate key sectors of the economy. It is not about patronage of party faithful. It is not about powerful civil servants determining who gets patronage. It is not about private sector operators hawking around government offices for contract jobs. It is not about private sector reaping economic

The National Assembly must be a place for honourable men and women of integrity, Nigeria must return to its social values not adopting Western values wholesale

rent and flashing the money around little girls and in frivolities. It is not about ostentatious living with display of the latest state of the art cars around and building the tallest edifice in Abuja. Capitalism is about investment. What are the investments Nigerian entrepreneurs are making? Apart from very few, Nigeria is a consuming nation. We import

virtually everything into the country. Nigeria’s kind of capitalism is crude, raw and primitive. It is a zero sum game of winner-takes-all. This is why the few who find themselves in positions of power and politics do it by all means. Politics in Nigeria is about resource allocation. It is not about investing in people; it is about personal interest and aggrandizement. Until the welfare of all Nigerians takes the prime place in the day-to day administration of the country, politicians and civil servants will continue to pillage and cart away the fortunes of Nigeria. The way to stop them is by making the future of every Nigerian secure. When a civil servant knows that when he retires, his family members will not be asking him questions of how much he stole from public treasury, he will not take bribe. If he knows that he will drag the name of his family in the mud if caught and publicized, he will stay off taking bribe. If politicians know that family members and society will denounce and deny them respect and a place of honour in their locality, they will behave. When a worker knows that if he loses his job, he will not be out in the cold, he would put in his best. This was the Nigerian way of curbing excesses and corruption. The National Assembly must be a place for honourable men and women of integrity. Nigeria must return to its social value not adopting Western values wholesale.

Business & Economy

Labour migration policy will spur Vision 2020 — FG By EMMANUEL ELEBEKE

HE FEDERAL Government has said that adequate utilisation of available manpower will ginger the realisation of vision 20:2020. The Minister of Labour and productivity, Chief Emeka Wogu, stated the government position at the national validation workshop of a new draft national labour migration policy in Abuja. Represented by the Permanent Secretary in the ministry, Dr. Clement Illoh, Wogu noted that labour

migration had contributed not just to national growth and development but also to peace, security, general well being and harmony of the country. This he said underscored the need for the support of all stakeholders to the new draft labour migration policy, expected to be forwarded to the Federal Executive Council, FEC, for approval and adoption. Wogu noted that labour migration was far from being a new phenomenon, as women and men had been leaving their homeland in search of better lives elsewhere for centuries, stressing that the difference now was that labour

migration was a far more widespread phenomenon in this era of globalisation than before, due to improvement in international communication and transportation systems. According to him,

“Deploying organised labour migration is key instrument for national growth because the contribution of organised labour migration is not just to national growth and development but for peace,

security, general well being and harmony. It is most appropriate for us in view of our abundant human resources to support the new draft labour migration policy and deploy it when adopted as an instrument of national growth and development underpinned by our national vision 20:2020.

FG can't meet infrastructure needs with N4.99trn spending — SEC DG Continued from page 18 mark. We will meet the target if the power companies, the telecommunications companies and the multinationals list their shares on the Nigerian Stock Exchange. Already, the sub-

committee on Business Development is working on the listing agenda for large companies in Nigeria. We are very much align with the G8 (Group of eight developed nations) in reducing illicit financial flow from the developing nations through transfer pricing or mispricing

.The idea is that they will bring more liquidity to the market.” The SEC boss also urged both the federal and state governments as well as corporate entities to pay more attention to the opportunities provided by the capital market in infrastructural financing. C M Y K

20 — Vanguard, MONDAY, JULY 1, 2013

Business & Economy BRIEFS Operators want FG to create conducive environment for gas development

ARGINAL Field Operators have urged the Federal Government to create conducive environment for gas development in Nigeria. The operators made the call in Lagos at a forum jointly organised by the UK Trade and Investment and Nigeria Marginal Field Operators Group. The forum, the first of its kind in Nigeria, had the theme, “Telling our Stories”. Mr Dada Thomas, the Managing Director, Frontier Oil Ltd.,said Nigeria had huge gas potential yet to be harnessed. Thomas said that government should “hands off ” the nation’s gas sector for it to be developed. ``Nigeria, no doubt, is a marginal gas producer. Government must, therefore, create enabling environment and hands off gas pricing.

Foreign direct investment to Nigeria, SA fell in 2012 — UN

FRICA was one of only two regions in the world to experience an increase in foreign direct investment in 2012 but inflows to regional giants Nigeria and South Africa declined, a United Nations report said. While global FDI fell by 18 percent last year, Africa bucked the trend with inflows increasing 5 percent to $50 billion, as countries like Mozambique, Tanzania and Uganda reaped the benefits of new discoveries of oil and gas, according to the 2013 World Investment Report published by the United Nations Conference on Trade and Development. South America was the only other region to see a year-onyear rise in FDI inflows, which grew 12 percent, though flows to the Latin America and Caribbean region as a whole declined. Although West Africa had the biggest share of investment, flows to the region declined by 5 percent to $16.8 billion largely due to decreased investment in the continent’s top oil producer Nigeria. Its FDI inflows fell from $8.9 billion in 2011 to $7 billion last year due to political insecurity and a weak global economy, UNCTAD said. C M Y K

'Entrepreneurial spirit is key to promoting development in Africa' By OMOH GABRIEL

REATING opportunities for Africa’s young population is paramount for the positive development of the continent. This was the conclusion arrived at by participants that attended the Africa-Europe Entrepreneurs’ Dialogue. The event was hosted in Ghana by DEG Deutsche Investitions- und Entwicklungsgesellschaft mbH, at the initiative of the Former President of Germany, H.E. Professor Dr Horst Köhler, Betty Maina and Prof. Fulbert Gero Amoussouga. The conclusions of the three days dialogue are to serve as input into the Post2015 Agenda on new universal goals. In forum agreed that private sector involvement is critical to leap frog Africa development. Speaking at the forum Mr. Bruno Wenn, Chairman of DEG’s Management Board said “Without lastingly successful businesses, there are no jobs. We have to make sure that more and more people in developing countries find qualified work that enables them to make a living for themselves and their families”. Governments not only have to create an enabling environment for doing business at the national but also the international level. This includes, among others, resilient global financial markets that serve the real economy, an open and fair trading system, climatic stability, as well as curbed illicit financial flows. A fair

access to the domestic markets of industrialised countries and true regional integration are vital for African businesses to strive. Tax evasion and illicit financial flows from Africa have to be efficiently reduced by policies in both sending and receiving countries. The exchange between the entrepreneurs and the young generation was another important aspect of the conference in Ghana. In the context of a Town Hall Meeting, students of the University of Ghana and vocational trainees discussed with the entrepreneurs on job creation in Africa. They exchanged views with the participants of the entrepreneurs’ dialogue on

their expectations regarding Africa’s youth and the economy. Horst Köhler emphasised that a new Post-2015 Agenda should pay special attention to the African continent, in view of the fact that Africa’s population is growing at twice the rate of Latin America or Asia. He added that by just 2025, one in four of the world’s young people would come from Sub-Saharan Africa. “Young people need opportunities, they need jobs – and they are giving voice to those needs”. He called for a greater commitment in the area of vocational training in Africa on part of the companies. “Education is the key to almost everything: to

From left: Director General, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Dr. John Isemede; Commercial Staff of the Embassy of Egypt in Nigeria, Mrs. Eman Mabrouk; Minister Plenipotentiary, Embassy of Egypt, Usama Mito; Business Development Consultant of NASYDCO, Ashraf Eldah and Managing Director of Future Company, Egypt, Hany Mostafa during a business visit by some Egyptian Companies to NACCIMA Secretariat today.

AfDB okays $ 80m loan to boost agribusiness in Africa T

HE Board of Directors of the African Development Bank (AfDB) has approved a $80 million senior loan in local currencies for OLAM Africa Investment Program (OAIP) to deepen the integration of OLAM Group’s agricultural value chain by investments in processing of wheat and palm oil in Africa. The program includes five sub-projects in Cameroon, Ghana, Mozambique and Senegal. Ultimately, this program will enhance the regional food supply chain and act as a catalyst to support job creation and improve sustainability of agribusiness sector, thereby enhancing food security in Africa.

personal development and self-determination, but also to economic development and progress in society ”. According to Köhler, this would also be in the interest of the companies, which need highly skilled workers. Horst Köhler, Betty Maina and Prof. Amoussouga are Members of the High-Level Panel of Eminent Persons on the Post-2015 Development Agenda that submitted their recommendation to UN Secretary-General Ban Kimoon in the end of May. This report feeds into the discussion about new development goals. The new agenda is to define a series of universally relevant goals. The private sector plays a key role.

African food and agricultural markets are extremely fragmented along regional, national and even local lines due to the predominance of small scale farming in the region. Harnessing the opportunities in the sector and successfully competing in the global market therefore demands efficiency in the deployment of labor and logistics infrastructure to link suppliers and buyers in the region. The OLAM Group’s scale and existing distribution strength will positively impact the linkages. OLAM Aviv Investment Holdings, Mauritius, a fully owned subsidiary of OLAM Group, will be the program’s

borrowing entity. OLAM Group, a leading global integrated supply chain manager with a direct presence in 65 countries, has built a leadership position in many of its businesses – including cocoa, coffee, cashew, sesame, rice, cotton and wood products. In Africa, OLAM Group is present in 26 countries and conducts business in 28 cou ntries. The Group’s Africa business includes an integrated supply chain of 16 products, employing 6800 employees, 1700 of which are women. OLAM Group works with 3.4 million small-scale farmers in Africa and has 110 initiatives, covering 1.4 million farmers in

Africa, to help address many of the issues faced by these smallholders such as poverty and lack of education, food security and basic social amenities. OLAM Group was awarded “The leadership award for sustainable development in Africa” at the 2012 World Bank meetings. The award recognizes the Olam Livelihood Charter – the flagship Corporate Social Responsibility program of OLAM that will benefit up to 500,000 farmers in Africa by 2015. The OAIP program as part of value chain will create 600,000 tons/annum of additional processing capacity, 1 million ton of palm oil supply chain with matching infrastructure, regional food supply chain as well as 8500 direct and indirect employment opportunities 25% for women - in upstream, sourcing, direct employment and distribution.

Vanguard, MONDAY, JULY 1, 2013 — 21

Business & Economy

Consumer spending rebounds, jobless claims fall in US C

ONSUMER spending in the US rebounded in May and new applications for unemployment benefits fell, suggesting the economy remained on a moderate growth path. The Commerce Department said that consumer spending increased 0.3 percent last month after a revised 0.3 percent drop in April. Consumer spending in April was previously reported to have declined 0.2 percent. Last month’s spending increase was in line with economists’ expectations. When adjusted for inflation, consumer spending rose 0.2 percent last month after dipping 0.1 percent in April. In a separate report, the Labor Department said initial claims for unemployment benefits fell 9,000 to a seasonally adjusted 346,000. The fourweek moving average for new claims, which irons out weekto-week volatility, fell 2,750 to 345,750. U.S. stock index futures slightly added to earlier gains after the data. U.S. Treasuries prices extended price gains and yields fell to session lows, while the dollar pared gains against the yen. Recent data, including housing, regional factory activity, business spending plans and consumer confidence, have pointed to an economy that is regaining some speed after stumbling early in the second quarter. That is broadly supportive of the view the Federal Reserve expressed last week that the downside risks to the economy’s outlook have waned. Fed Chairman Ben Bernanke said the U.S. central bank could start scaling back on the pace of its monthly bond purchases this year. Consumer spending accounts for 70 percent of U.S. economic activity. Though the pace of spending has slowed from the 2.6 percent annual rate notched in the first three months of the

year, consumers will likely continue to drive growth in the second quarter. The firming growth theme held as other details of the Commerce Department report showed income grew 0.5 percent last month, the largest gain since February, after nudging up 0.1 percent in April. That reflects a

steady pace of job gains. Households also saved a bit more last month, lifting the saving rate to a five-month high of 3.2 percent. There was also a bit of inflation in the economy last month, pointing to some pick-up in demand. A price index for consumer spending inched up 0.1 percent in May

after declining two straight months. A core reading that strips out food and energy costs also rose 0.1 percent after being flat in April. Over the past 12 months, inflation rose 1 percent, still below the Fed’s 2 percent target. The index had increased only 0.7 percent in the period through April. Core prices were up 1.1 percent from a year ago after rising by the same margin in April. Falling healthcare costs are dampening inflation pressures. Bernanke has said the weak healthcare costs were likely to transitory.

From left: Mr Ehi Brahimoh, MD, New Media and Marketing; Ngozi Nkwoji, Senior Brand Manager, Maltina; Mr Edem Vindah, Corporate Media and Brand PR Manager, Nigerian Breweries PLC and Mr Abayomi Abidakun, Asst Brand Manager, Maltina at the Maltina dance All season 7 The Evolution press briefing held in Lagos. Photo by Lamidi Bamidele.

CITN says no law prohibits videotaping during enforcement of tax laws

tax expert, Mr Agbeluyi Olushola, said that there was no law prohibiting revenue authorities from videotaping while enforcing tax law. Olushola, who is the Chairman, Ikeja District Society of the Chartered Institute of Taxation of Nigeria (CITN), said this in an interview with the News Agency of Nigeria (NAN) in Lagos. He said that a revenue agency could adopt any approach to collect tax. Olushola was reacting to an allegation that the Lagos State Internal Revenue Service officers videotaped tax defaulters’ premises while enforcing tax law.

According to him, the issue of tax is about law and practice. “The law gives steps and procedure that a revenue agency is supposed to follow before you distrain a company. Of course, there must have been established liability. The liability must have been communicated to the taxpayer; the taxpayer has been given the opportunity to object. “The objection must have been tabled and discussed leading to what is called final liability. The final liability must have been communicated to the taxpayer and within certain period, if certain things are not done, then you take certain steps toward distrain, so distrain is law.

Kenya to fix refinery after protests over closure plan K

ENYA plans to upgrade east Africa’s sole refinery located at the port of Mombasa, Energy and Petroleum Minister Davis Chirchir told workers at the ageing facility after the threat of closing it prompted protests. The decision to keep the plant working was made as prospects for an oil and gas boom in the region intensify with a string of discoveries in Kenya and other nearby states, These discoveries could soon transform an area that has long depended on imports into a C M Y K

major energy exporter. Uganda, keen to develop its oil reserves and which till now has relied on the Kenyan facility, is planning its own refinery. “The closing down of this facility is not an option,” the minister told workers, who had protested earlier in June. I have requested the refinery management to quickly feed us with the various options of upgrade and their costs,” he said, adding it was critical for the plant to remain competitive. A day earlier, the presidents

of Kenya, Uganda and nearby Rwanda, who met in the Ugandan capital, had said one of the joint projects agreed was to upgrade an oil products pipeline from Mombasa and extend it to Uganda and Rwanda. The upgrade would allow products to flow both ways. Kenya’s refinery, run by India’s Essar Energy which coowns it with the government, typically refines 4,500 tonnes of crude per day (about 32,000 barrels per day), but this has fallen to 2,500 or less due to a drop in buying it products by

oil marketers, a refinery official said earlier. Essar has said it wants to raise $1.2 billion for a substantial overhaul of the plant. But the Energy Regulatory Commission (ERC) had said the refinery could be converted into a different use, such as storage, if upgrading was too costly. The refinery’s managing director said in April that after its upgrading and expansion, it would have a crude handling capacity of four million tonnes of crude per year (79,000 bpd) by 2018 from 1.6 million tonnes now.

BRIEFS 16 ships to discharge fuel, other commodities at Lagos ports

ixteen ships are waiting to discharge petroleum products and other goods at the Lagos ports, the Nigerian Ports Authority (NPA) has said. The “Shipping Position”, a daily publication of the NPA, disclosed this on Wednesday. According to the document, 12 of the ships will discharge petrol at the various oil terminals within the Lagos ports. One of the ships will discharge diesel, one will discharge ethanol, while two will discharge bulk malt and bulk salt. NPA said that 88 ships, carrying different cargoes, would sail into the ports from June 27 to July 22. It said that 22 of the expected ships were coming with petroleum products, while seven ships would be laden with new and used vehicles. Ships will arrive with containers, bulk salt, general cargo, bulk wheat, bulk fertiliser, bulk malt.

Europe strikes deal to push cost of bank failure on investors

he European Union has agreed to force investors and wealthy savers to share the costs of future bank failures, moving closer to drawing a line under years of taxpayer-funded bailouts that have prompted public outrage. After seven hours of late-night talks, finance ministers from the bloc’s 27 countries emerged with a blueprint to close or salvage banks in trouble. The plan stipulates that shareholders, bondholders and depositors with more than 100,000 euros ($132,000) should share the burden of saving a bank. The deal is a boost for EU leaders, who meet In Brussels, and can show that they are finally getting to grips with the financial crisis that began in mid-2007 with the near collapse of Germany’s IKB. “For the first time, we agreed on a significant bail-in to shield taxpayers,” said Dutch Finance Minister Jeroen Dijsselbloem, referring to the process in which shareholders and bondholders must bear the costs of restructuring first.

22 — Vanguard, MONDAY, JULY 1, 2013

Banking & Finance BRIEF Sukuk tests industry’s appetite for complexity

NTERBANK lending programmes that securitise sukuk are testing the Islamic finance industry’s ability to digest complex financial products. Some firms are starting to combine sukuk, using portfolios of long-term issues to back short-term certificates. This lets them create liquidity programmes that address a major weakness of the Islamic finance industry: a persistent shortage of money market instruments needed by Islamic banks to manage their short-term funds. Such is the approach used by Liquidity Management Centre (LMC), a Bahrainbased wholesale Islamic bank. “The programme is very simple: we have an SPV (special purpose vehicle) where we book all the sukuk. The SPV is fully backed by sukuk of different tenors and rates,” said Ahmed Abbas, LMC’s chief executive. The rising number of sukuk issuers globally is making it easier to manage the programme, and LMC plans to double its size in a year’s time from about $120 million now, Abbas added. “As we speak, we are reviewing our offering circular. We will have more options in terms of tenors, rates and liquidity.” He added, “As we see more issuers come to the market, the programme can grow. This helps in geographical distribution, the number of issuers - it helps on many levels.” A similar format is to be used by the Malaysiabased International Islamic Liquidity Management Corp (IILM), which plans to launch a Luxembourg-domiciled programme of its own. All of the assets will be either sovereign, sovereign-linked or supranational assets,” said Eric Gretch, senior director at Standard and Poor’s, which rates the programme. For example, Nigeria is only just starting to develop Islamic finance; its cocoa-producing Osun State plans to issue the first sukuk in the country, a 10 billion naira ($62 million), seven-year issue, by the end of July. But the Nigerian central bank issued guidelines in December for asset-backed securities that would use IILM certificates as collateral - essentially creating three layers of sukuk.

C M Y K

Stories by BABAJIDE KOMOLAFE

OW interest rate regime and long term funds are critical to development of the real sector and realisation of the vision 2020. Honourary Adviser to the President on Electric Power, Engineer Joseph Makoju stated this at the post annual general meeting talk of the International Chamber of Commerce Nigeria (ICCN). “He said, “The truth of the matter is, despite the entire noise making about getting the real sector to drive economic development; the fundamental requirement is development funding. Low interest rate and long term funds must be available. No

'Low interest rate critical to achieving vision 2020 in real sector' matter the claim of what is being done or achieved in this regard, they are just not there. Efforts being made through institutions like Bank of Industry are insignificant especially when compared to what other competing developing economies are doing”. He noted that presently, the manufacturing sector ’s contribution to the nation’s gross domestic products (GDP) is low. “The sector ’s contribution to exports is zero, as most of our imports

are manufactured goods. However, no nation achieved development without significant increase in the contribution of the manufacturing sector to GDP.” He said that the manufacturing sector has high growth potential due to the natural endowment of the country, but the development of the sector had been undermine in the past by inconsistent government policies. He said the situation has however improved in recent times due to stable

From left: Adekunle Salau, Advisory Leader for West Africa, Ernst & Young; Olapeju Oluwajana, Head, Compliance Subsidiary Monitoring & Corporate Governance Compliance, First Bank Plc; Dayo Babatunde, Financial Services Leader for West Africa, Ernst & Young; Mr. Pattison Boleigha, Chief Compliance Officer, Access Bank Plc; Mrs. Bunmi Akinde, Senior Partner, Advisory, Ernst & Young and Mr. Abass Adeniji, Tax Leader for West Africa, Ernst & Young, at the FATCA Breakfast Forum organised by Ernst & Young in Lagos.

ERITAGE Bank Limited has been integrated into the Instant Pay Platform of the Nigeria Interbank Settlement System (NIBSS). With this development, new and existing customers of the bank can make payment and transfer funds through Point of Sale terminal, ATMs across the country, and from any of the bank’s branches and electronic payment platforms. NIBSS communicated this development to banksand electronic payment firms saying, “Please be informed that Heritage bank has been migrated to the Nigeria Instant Payment (NIP) production environment. Kindly accept all upstream transactions from them” Commenting on this development, Managing Director/Chief Executive, Heritage Bank, Mr. Ifie Sekibo said the integration reflects confidence in the robust information technology

macroeconomic stability and reforms in various sectors of the economy. He cited the example of the cement industry, which now produces all the cement consumed in the country, as an example of how to use government policy to enhance development of the real sector. Makoju said that what is required is for government to play the role of an enabler, by putting in place measures that will aid manufacturing across the country. Meanwhile, ICCN has made a case for government to actively engage the private sector for the development of the economy. Speaking at the 14th annual general meeting of the Chamber in Lagos last week, Chairman of the Chamber, Mr. Babatunde Savage said, “The active engagement of the private sector is necessary for the success of sustainable development and poverty alleviation. The role of ICC to foster more foreign direct investment through global presence and drive improving global recovery strategies is quite germane. To that end, ICC Nigeria would focus more on sustaining investors’ confidence in the system through the introduction of ICC products and services in a bid to establish international best practices, which would ultimately help build peace and prosperity."

Heritage Bank integrates into NIBSS Instant Pay platform infrastructure and electronic payment platform of the bank.” He said, “Most banks take quite a long time to integrate into the NIPS platform, but within a very short period of our existence, within two to three months, we have integrated into their system. Our entire payment platforms have been fully integrated. And we are functional, up and running. So for us it is a real ground breaking and record setting achievement, and it reflects confidence from an epayment switch like NIBSS. “Also it expands our business environment. We are now connected to other e-payment switches, banks, banking platforms. People can now use our internet banking platform to make instant payment for

goods and services, make funds transfer to people in other banks, and vice versa. It is a seamless and full integration into the banking and e-payment platforms in the country. “It also buttresses the point that the way to go in modern banking is not brick and mortal. E-banking enhances inclusion of many people. It allows those that have been excluded from banking activities to participate in and benefit from banking activities. With this development, we have become part of the nucleus to make that work. This means in a short period we are part of the nucleus of financial inclusion, which is being advocated by the Central Bank of Nigeria. That is

people being able to use our platform to make payment, instantly and from anywhere. It is a record breaking thing of joy for us.” Formed from the defunct Societe Generale Bank (SGNN), Heritage Bank commenced operations in March, promising to be a technology driven and customer centric bank. The bank took off with an account verification exercise aimed at verifying the customers of the former SGBN, with the promise of paying them their deposits in the former bank. One month after its inception, Heritage Bank introduced free COT charge for all its account holders, thereby demonstrating its readiness to offer efficient banking services at least cost to customers.

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Banking & Finance

Protect interest of all stakeholders, BDAN charges new members Stories by BABAJIDE KOMOLAFE

From left: Sir Steve Omojafor, Chairman, Zenith Bank PLC; Olorogun Sunny Kuku, President, Bank Directors Association of Nigeria and Mr Ifie Sekibo, MD, Heritage Bank during the Business Launch to welcome the Directors of the newly licensed banks to Bank Directors Association of Nigeria held in Lagos on Friday. Photo by Lamidi Bamidele. “They must also realise that the stakeholder is not just the shareholders whom they represent but also the depositors and creditors, as well as the regulators. So they must not only look after the interest of the shareholders but also after the interest of depositors and creditors. If

they do that, then they would be successful”. On his part, Guest Speaker and Chairman of Zenith Bank, Sir Steve Omojafor advised the new members to always consider the legacy they want to leave behind. He said, “So, how do you want to be remembered? By

ACCA launches free job portal for members, employers A

SSOCIATION of Certified Chartered Accountants has launched a free job portal designed to connect employers with its members and students. Speaking at a media briefing in Lagos, Country Manager, ACCA, Nigeria, Mrs. Ademola said that the job portal was developed and introduced globally by ACCA to provide job opportunities for its members. “Basically this was set up as the official website of ACCA, and it is already being used in United Kingdom and Asia. Nigeria is the first country in Africa to be on the portal. The reason for that is we are interested in providing job opportunities for our students and members. Also we are interested in providing employers with the

US mortgage rates soar to 2-year high

ANK Directors Association of Nigeria (BDAN), the umbrella body of non-executive directors of banks, has charge non executive directors in the four recently licensed banks to protect the interest of all stakeholders. BDAN President, Olorógun Dr. Sunny Kuku gave this charge at the luncheon organised by the Association for new members from Heritage Bank Limited, Jaiz International Bank, Rand Merchant Bank and FSDH Merchant Bank. Advising the non-executive directors of the banks, Kuku said, “First, they should ensure they are trained in governance especially for financial institutions; it is not exactly the same like where we are coming from. “Then, they should also realise that there is a lot of responsibility is put on them. And one of the most important things is that they must have knowledge, they must know everything that is going on because ignorance is not an excuse. They should go and read the governance code of the CBN. They cannot claim ignorance. Then they must not interfere with operations, just as management must not interfere with oversight.

BRIEFS

qualified finance professionals that they need,” she said. Explaining how the portal works, she said, “We are offering free listings for employers and also free CV uploads for all our students. It is a career portal, employers go there and put up the vacancies that they have. Sometimes the employers go into the system and look for CVs that they think match the vacancies that they have. And all these, we are doing it for free in Nigeria, and this shows that Nigeria is important to us in Africa. Also we recognised that these things are not easily affordable by all, and we need to face realities because sometimes when students go through recruitment agents

they are asked to pay.” On the benefits the portal offers to job seekers, she said, “When we did our job fair, it was well received with many employers attending. But many of them did not come. So this portal offers to the average Nigerian students the opportunity for their CVs to be seen not only by employers in Nigeria but employers globally. The way it works is that on the portal, each country has its own site. For instance, we have a site for Nigeria, so somebody in Hong Kong, Malaysia can actually go there and look at the CVs on the site. And if they feel that this person is actually qualified and they want to speak to the person, they can actually contact him or her.”

all standards, you have worked hard since you left school, some prefer to say university, and you have worked your way from apprenticeship to the top of your career. An adage says that “a good name is better than gold.” Do you share in this old, may be, worn-out sentiment? So what legacy will you leave behind, besides your wealth? (Which others might help you squander when you are gone, anyway!) What will society remember you for, besides being one of the big boys who had so much money and didn’t know what to do with it? “Will you be remembered as the highly principled, yet successful professional) who never compromised on integrity? One, who contributed a little extra to uplift crumbling standards, One, who helped send an indigent youth to school? Helped dig a borehole for the community? Contributed to building a school, a church or a mosque? What will your own children remember you for, besides being that rich, successful parent, who could afford the best of everything for them - holidays in Disney Land, Dubai, Paris or may be Florida? What values are you leaving behind for your children to inherit? I mean) values that will see them through the challenges of life, long after you’re gone?”

S mortgage rates surged last week to their highest level in almost two years and threatening to slow the housing industry’s steady recovery. Mortgage buyer Freddie Mac said that the average rate on the 30-year fixed loan jumped to 4.46 percent, the highest level since June 2011. That’s up from 3.93 percent from the previous week. It was the largest weekly increase in the 30year rate since April 1987, Freddie Mac said. The average rate on the 15-year mortgage jumped to 3.50 percent from 3.04 percent. That’s the highest since August 2011. A year ago, the rate on the 15-year mortgage was at 2.94 percent. The increases follow rising yields on the 10-year Treasury bond in the wake of Federal Reserve Chairman Ben Bernanke’s comments that the Fed could start trimming its stimulus policies later this year if the economy continues to improve. Mortgage rates track the 10-year Treasury rate, which is at a two-year high. The monthly mortgage payment jumps to $1,008 a month at a rate of 4.46 percent. That’s an increase of $127 a month, which over 30 years adds $45,720 to the cost of the loan. The figures don’t include taxes and insurance.

GE moves to new office to support growth

ENERAL Electric (GE), has discloed its relocation to a new office space to accommodate the rapid growth of its operations in Nigeria. The new office space located in Victoria Island, Lagos, will provide capacity for the expansion of the company’s capabilities. Speaking during the commissioning of the new office space, President and CEO, GE Nigeria, Dr. Lazarus Angbazo, said that the company’s aggressive growth plans for Nigeria, has necessitated moving its operations to a larger facility. He added that the move to such a world-class office facility was in line with GE’s efforts to invest in their local presence.

24 — Vanguard, MONDAY, JULY 1, 2013

Corporate Finance BRIEFS Heirs Holdings invests in new NASD trading platform

ONY Elumelu ’s Heirs Holdings, the pan-African investment company announced that it has taken a strategic stake in the new NASD trading platform which will commence operations on July 1 this year. Following the group’s recent investment in Africa Commodity Exchange Limited (AFEX), which Heirs Holdings cofounded with the US-based Berggruen Holdings, this announcement represents another significant move to develop equity and commodity trading in Africa. The NASD is an alternative trading platform created by the National Association of Securities Dealers to bring more liquidity to Nigeria ’s capital markets. It has been licensed by the Securities Exchange Commission (SEC) to trade a broad range of instruments over-the-counter including unlisted equities and bonds in Nigeria. NASD will join the Nigerian Stock Exchange (NSE), as well as the recently created Alternative Securities Market (ASEM) designed for unlisted stocks and fastgrowing SMEs to bring more choice and transparency to thousands of companies looking to trade their shares on an open, regulated market.

Partnership Investment boss donates to orphanages

OR the fourth year running, two orphanages in Benin City , Oronsaye Orphanage & Maternity and Edo Orphanage & Maternity Home have received cheques of half a million naira (Five Hundred Thousand Naira) each to pay the school fees of orphans in the two homes. The donations were made by Mr. Victor Ogiemwonyi, the Managing Director & CEO of Partnership Investment Plc who, as part of the Partnership Scholarship Scheme, set up the charity project in 2010 to help pay the school fees of children in the two Orphanages. Presenting the cheques to the two homes in Benin , Mr. Ogiemwonyi, through a message delivered by the coordinator of the Scheme, Mr. Ogie Eboigbe, said, the Partnership Scholarship Scheme was in fulfilment of his pledge to, by the grace of God, continue to pay the school fees of the children in the Homes who show promise of benefiting from formal education. C M Y K

By NKIRUKA NNOROM

ESPITE the fall in the share prices of listed companies in the last two weeks, shares of many of the consumer goods companies remain slightly over-priced and will likely experience more corrections, said the Managing Director, Financial Derivatives Company, Mr. Bismark Rewane. Rewane said that unlike the consumer goods sector, banking stocks are undervalued and have the potential to withstand the present downturn in the market. Making the postulation in his bi-monthly review of the economy for June, 2013, ‘BiMonthly Economic and Business Update, he said, “At current level, the market remains slightly overpriced with a trailing price to earnings (P/E) of 13.9x and many of the consumer goods stocks still trading at a P/E of greater than 30x. We expect the correction to continue in this sector, although we do not expect an Armageddon as most stocks in the sector are defensive and are likely to weather the storm.” He, however, stated that the market looks cheap on the banking sector perspective, saying, “All listed banks except Stanbic IBTC Holdco Plc, Union Bank Plc and Wema Bank Plc, are trading in single digit P/Es, with the most attractive being UBA and Access Bank with a P/E of 4.9x and 5.8x respectively. “Given that stocks in the banking sector are held by portfolio investors with a longterm outlook and the strong earning power of the sector, we expect banking stocks to remain resilient even in turbulent times. Data also shows that there has been more buying than selling of tier one banks shares in the last three months, giving the sector a stamp of approval by investors.” He added, “The major risk to the market, as we stated in our LBS publication in May, remains the price of crude oil and the exchange rate direction. Despite our bullish stance on the long-term growth of the index, we believe a structural depreciation of the naira could result in a major sell-off in the market. For now, we consider this unlikely, but the risk still exists.” He further noted that the reversal witnessed so far has been sharper than the growth where the All Share Index reached 40,000 basis points in May. His word, “The Nigerian Stock Exchange’s (NSE) All Shares Index (ASI) is experiencing a torrid June.

‘Consumer goods companies'shares over priced, to fall further’ After a strong performance in May and an impressive start to the month of June, crossing the 40,000 points along the way, the market reversal was sharper than the rise. “The ASI suffered its first consecutive five-day fall, its longest losing streak in a year, with a compounded loss of 7.5 percent (2,987.94 points) in the five-day period between

the 12th June and 18th of June. The loss was due to investors taking profit on stocks that had depreciated in the recent bull-run. The month-to-date returns of -2.04 percent is the lowest monthly return figure since June 2012. Given the currency depreciation over the period, the loss in dollar terms amounted to 3.2

percent. The disruption that has gripped the bond market for over a month has now descended on the equity market as well. Bond yields have been rising as prices decline as a result of reduced demand for FGN bonds by foreign portfolio investors. The situation has not been helped by the depreciation of the naira, which has exposed portfolio investors to forex losses.”

From left: Chairman, Association of Stockbroking Houses of Nigeria (ASHON), Mr. Emeka Madubuike and Managing Director/Chief Executive Officer, Access Bank Plc, Mr.. Aigboje Aig-Imoukhuede at the Association of Stockbroking Houses of Nigeria, ASHON capital market night in Lagos recently.

Foreign investors shun Diamond Bank’s $550m bonds BY NKIRUKA NNOROM with Agency Report

IAMOND Bank’s quest of raising fresh funds amounting to $550million from international market may have hit the rocks as foreign investors have shown no interest in buying into it. The debt was part of $750 million needed for its operations, of which $200 million had already been raised last year According to the bank, fresh fund would enable it to increase lending to the oil and gas, power and infrastructure sectors. Already, France’s BNP Paribas and Afrexim Bank have been contacted as lead managers to the bonds. However, the bank’s twoweek investor road show to Britain, Switzerland and the United States last week, which was meant to update fund managers on the bank and gauge appetite for the issue

ended in no deal, according to the Chief Finance Officer, Abdulrahman Yinusa. He stated that due to the prevailing circumstance, the planned bonds issuance would take place in July, while pricing and tenor would be dependent on market conditions. Sources close to the deal said that Diamond Bank had wanted to issue the bond at a yield of six to eight percent penultimate week, mirroring the seven percent yield that rival lender, Fidelity Bank, fetched on its $300 million Eurobond issue in May. According to Yinusa, “The issue as well as the pricing will happen some time in July. We have only done the road show,” adding that the bank had met Goldman Sachs and Fidelity fund managers, among other investors during the road show. Depending on the pricing and tenor, Diamond Bank

could settle for an amount between $300 million and $550 million, Yinusa said, noting that it will issue a minimum maturity of seven years in order for the bond to qualify as Tier II capital on its books. In an investors’ presentation prepared for the bond, it said the proposed 10-year bond will be callable after five years and will be listed on the Irish Stock Exchange. It would be recalled that last month, Fidelity Bank, issued a $300 million 5-year Eurobond paying a seven per cent yield. Also, FBN Holdings Plc, the parent company of First Bank Nigeria, announced a few weeks ago that it plans to raise $500million by selling a Eurobond this year. The Chief Executive Officer, FBN Holding, Mr. Bello Maccido, said that the money was needed to finance investments in loans and infrastructure. He said, “The bank intends to expand its investment banking and commercial business as well as insurance.”

Vanguard, MONDAY, JULY 1, 2013 — 25

Corporate Finance

Japual Oil turnover up by 20 % … Explains drop in profit By PETER EGWUATU

APAUL Oil & Maritime Services Plc has recorded a turnover of N12.3 billion for the financial year ended December 31, 2012, representing a growth of 20.9 per cent from N10.2 billion recorded in the corresponding period of 2012. The firm also recorded a growth of 5.8 percent in its gross profit for the year under review, from N4.722 billion in 2011, to N4.999 billion. Meanwhile, Japaul’s Profit After Tax (PAT) dropped by 171.7 percent from N980.438 million in 2011 to N283.732 million in 2012. Speaking to shareholders at the 8th Annual General Meeting (AGM) in Lagos last week, Chairman of

Japaul Oil & Maritime Services Plc, Major General J. Omosebi said that the local content policy of the Federal Government supported the company’s business , and commended the government for its initiative. According to him, during the year under review, there were no new investments by oil major in the industry simply because they were waiting for the passage of Petroleum Industry Bill (PIB) by the national assembly. He noted that stiff competition with foreign vessels owners persisted during the year under review, but the local content policy helped to reduce the consequence. On operating result of the company for the year 2012, the Chairman

explained that the increase in the company’s turnover was a pointer to the fact that it had more business opportunities during the year 2012 than 2011, which was expected to result into higher profit. According to him, “ However, the profit for the year 2012 though good s expected but due to some circumstances and in compliance with the

newly introduced policies in preparing statutory financial returns, the net profits was much lower. Meanwhile, the Managing Director/CEO, Japaul Oil & Maritime Services, Mr. Jegede Paul in an interview with newsmen on way forward for the company , he said “Well ,we are expecting improved performance in terms of high return on investment.

From left:Assistant General Manager, Consultancy and Training, Osun State Investment Coy Ltd, MrsHarriet Amale; Managing Director/CEO, Mr Bola Oyebamiji; Regional Sales Manager, Nestle Nigeria Ltd, Mr Dayo Adekoya; and Senior Manager, Bulk Purchase, OSCIL, Mr Ganiyu Owolawi, during the presentation of Outstanding Performance star prize of Tata Pickup by Nestle to OSICL, in Oshogbo, Osun... on Thursday.

Nigeria controls largest construction market in Africa — Lafarge WAPCO boss By FAVOUR NNABUGWU & RUTH ODINA

ITH an estimated market potential of cement consumption of running over 50 million

metric tons per annum, the structure behind the growth in the sector could be traced to the cement market where Nigeria’s cement producers and investors alike are spearheading expansion and growth of the country cement sector Managing Director of Lafarge Cement Wapco, Mr. Joe Hudson, who disclosed this in Abuja, stated that its financial accounts for three months ended 31 March 2013 show as follows : Profit After Tax (PAT) grew 49 per cent year on year ,y/y to N6.1 billion with modest sales of N23.3 billion; Its profit before tax

(PBT) grew 21 per cent y/ y due to a number of factors such as a gross margin expansion of 181bps to 42.8 per cent, flattish opex and a 35 per cent decline in net interest income. A lower tax rate of 15.7 per cent compared with 31.8 per cent in first quarter 2012 resulted in profit after tax growing faster than profit before tax, the sales grew 29 per cent quarter on quarter q/q, while profit before tax and profit after tax advanced by 46 per cent and 56 per cent q/q respectively. Looking at the outlook for the year 2013, Hudson, said

CSCS achieves 158% profit growth By NKIRUKA NNOROM

ENTRAL Securities and Clearing System Plc (CSCS) said it grew its profit after tax for the year 2012 by 158 percent riding on the back of prudent financial management of resources and successful implementation of a corporate transformation agenda. Speaking at the 19th annual general meeting in Lagos, the Chairman, Mr. Oscar Onyema, said that the profit after tax soared from N1 billion to N2.58 billion in 2012, while, profit before tax witnessed a growth of 77 percent from N1.73 billion to N3.06 billion in 2012. The company also posted total revenue of N5.17 billion in 2012, up

by19 percent from the N4.19 billion in 2011. Following the performance, N750 million, amounting to 15kobo per share dividend was declared at the meeting, up from N500million paid in the previous year. Onyema noted that apart from the growth in profitability, total assets rose from N13.64 billion in 2011 to N15.43 billion in 2012, adding that the increase in dividend declared was in consideration of the company’s commitment to shareholders and the cost implications of its future strategy. He disclosed that in furtherance of its growth objectives, CSCS benchmarked its process and risks framework against the Committee on Payment and Settlement Systems.

“Outlook for the rest of the year remains positive as we continue to leverage on improvements and cost efficiency initiatives deployed during the year”. According to him, ‘‘We are leading the required differentiation in the Nigerian cement market and will continue to deliver value to our customers and stakeholders through our innovative products and services”. Continuing, he said, “Our ReadyMix business has become a preferred solution in the concrete sector in Nigeria. We are expanding with 3 new plants across the nation. Lafarge Powermax has also been launched; an innovative 42.5AL high quality performance cement that is used for large construction projects like bridges, high rise structures, slabs and beams, spun pipes, garden paths and driveways etc. “Lafarge is a multinational company headquartered in Paris. Lafarge is the world leader in cement and building materials. What differentiates us in the market is that we believe strongly in economic and social progress, and we are already present in sixty-four countries around the world. “From Lafarge, we realize that this country needs cement and building materials to grow, and although we are not the biggest in the market in terms of size, we are demonstrating leadership through the values that we bring to the market and our stakeholders. C M Y K

26 —Vanguard, MONDAY, JULY 1, 2013

C M Y K

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Micro-Finance

NAMB clientele base hits 6m Stories by PROVIDENCE OBUH

HE number of cus tomers patronis ing Microfinance Banks (MfBs) in the country is about six million on the average, National Association of Microfinance Banks (NAMB) has said. President of the association, Mr. Jethro Akun, who said this at the association’s third Annual General Meeting, noted that about five million active clients are on record. Akun said, “I am proud to say that MfBs nationwide has total client list of six million, out of which

five million are servicing one form of loan or another. “We have also contributed our quota to the nation by providing an avenue for job creation; 22,000 people have gained employment from the work of MfBs nationwide.” He called on government and other development partners to join hands to further promote the sub-sector. “NAMB is soliciting for more funds aimed at providing stability, refinancing and venture partnership to MfBs and institutions with potentials. “We continue to enquire on the Nigeria IncentiveBased Risk Sharing sys-

Commodity Index

tem for Agricultural Lending (NIRSAL), which is a CBN innovative mechanism targeted at de-risking lending to the agricultural sector,” he said. For poor rendering of premium by the association, he urged members to pay their dues and render their returns to CBN and NDIC to enable them function efficiently. Meanwhile, he revealed that members have invested more than N222 billion into Nigeria’s economy. He explained that the statistics on the contributions are based on the Central Bank of Nigeria’s report on the activities of 900 registered MfBs in the country as at December 31, 2012. “We recorded a total of N125 billion as deposit and N97 billion was given out as loan, which all accrued to N222 billion,” he said.

Financial services at micro level untapped — NDIC T

HE Nigeria Deposit Insurance Corporation (NDIC) has said that there is a huge untapped potential for financial services at the micro level of the country’s economy. Managing Director of the Corporation, Alhaji Umaru Ibrahim, said this at a workshop organised for operators in the Microfinance banking sector in Lagos. Umaru, represented by Director Special Insured Institutions Department, NDIC, Mr. Bashir Umar, said, “With an estimated population of over 160 million people in Nigeria, 70 per cent of whom are involved in the informal sector and 76.8 per cent of the rural residents unbanked (according to research by EFInA, 2010), it goes without saying that there exists a huge untapped potential for financial services at the micro level of the Nigerian economy.” Speaking on challenges, he explained that the regulatory authorities are not unaware of the numerous challenges facing the sub-sector. Such challenges include but not limited to under-capitalisation, illiquidity, high cost of funds, high operating cost, poor infrastructure, and false

life style of proprietors/ managers of microfinance banks. “Accordingly, measures are being put in place by regulatory authorities to provide relief to microfinance banks.” His words, “For instance, the Microfinance Development Fund (now MSME Development Fund) to provide whole-

sale funding for on-lending is being finalised by the Central Bank of Nigeria. Also, the Corporation is putting in place a framework for financial assistance to MfBs with intention to promptly intervene and assist the MfBs to overcome temporary liquidity problems.

NGSL calls for patronage of local products

IGERIA Gas and Steel Limited (NGSL), manufacturers of steel welded pipes and tubes for structures and buildings, has called onindustry stakeholders to partner with the company to promote local content. In a statement to Vnguard, the Managing Director, NGSL, Mr. Hasib Moukarim, said that it has contacted the Federation of Construction Industry by sending letters of introduction and presenting them at different forum to recommend to government officials and private sectors the benefits of local steel pipes. Some invited associations in the construction industry include; Nigeria Institute of Architects, Nigerian Institute of Town Planners, Nigerian Institution of Civil Engineers, Nigerian Institute of Quality Surveyors, Nigeria Institution of Structural Engineers and Nigeria Institute of Building. “The steel pipes as a genuine replacement of steel beams are imported into the country and are heavier and costlier. This informed our decision to enjoin the association to consider the thick steel pipes for steel structures and buildings in executing new projects and infrastructures in the country,” he said. C M Y K

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Homes & Housing Finance

‘Low insurance penetration hampers housing development’ Stories by YINKA KOLAWOLE

OW level of insurance awareness and penetration in Nigeria has been identified as one of the factors hampering the development of the nation’s housing sector. Managing Director, Union Assurance Company Limited, Mr. Godwin Odah, noted in a statement that no economy can thrive without a vibrant insurance sector which can breed entrepreneurship that will in turn, lift the housing sector. He asserted that insurance provides a platform for mobilising funds, which is critical to housing development. “We need

•Affordable housing development long term funds in the housing sector, which is what life insurance provides,” he said. The Union Assurance boss noted that there is currently acute shortage of long-term funds which

entrepreneurs need to grow the economy, because Nigerians are yet to appreciate life insurance as a natural way of saving for their long-term needs. “Life insurance comes in the

category of 5, 10 and 15 year plans and so on. If a sizable number of Nigerians, with the country ’s huge

population, invests just a small proportion of their income in insurance, the economy will expand because the money will be made available to investors who can then grow their businesses on long-term basis,” he explained. According to Odah, funds at the disposal of banks are short-term in nature and most times, have a tenor of 90 days. “With this condition, banks can only lend short-term at high interest rates that are largely a disincentive to the entrepreneur in the real estate business. But the situation will be better if banks had insurance life funds.” Odah said it’s not possible to achieve

sustainable expansion in the housing sector without mortgages which, according to him, will be easier if the insurance component was available to make the dream of housing for all a reality. “The insurance component takes care of the initial deposit required by the mortgage firms. But because insurance companies are backward in terms of patronage of life products, these longterm funds are not available for development. Pension funds, which are another component of insurance, have generated within a short period, about N3 trillion. Talks are ongoing to develop a framework for investment of the money for infrastructure development and in other sectors. This is a demonstration of what life insurance funds can do for national development,” he concluded.

Ogun lawmakers approve N2bn FMBN housing facility

GUN State House of Assembly has approved a bill granting the request by the state government to obtain a N2 billion real estate development loan facility to provide affordable housing for residents. The bill also authorised the Accountant General of the Federal Government of Nigeria to issue an Irrevocable Standing Payment Order (ISPO) for the amount in favour of FMBN. The state government requested for the loan to be used for the development of affordable housing projects in the three senatorial districts of the state. Chairman, House Committee on Finance and Appropriation, Mr. Olusola Bankole, observed that there was an urgent need to upgrade various housing estates spread across the state, which the loan will cater for. “With this development, the state government can now go ahead to obtain the N2bn Real Estate Development loan facility from the Federal Mortgage Bank of Nigeria to provide low cost housing and the issuance of Irrevocable Standing Payment Order by the Accountant-

General of the Federation in favour of the Federal Mortgage Bank of Nigeria,” he said. In his reaction, Commissioner for Housing, Mr. Daniel Adejobi, said it is necessary for the state government to join hands with the federal government in reducing housing deficits in the country. He said the facility would be accessed through Gateway Saving and Loans, and would be strictly used for the

development of housing estate for workers and the general public across the state. Adejobi said all workers and citizens who are contributors to the National Housing Fund (NHF) automatically qualify to benefit from the proposed housing projects. “We already have drawings according to the specifications of the Federal Mortgage Bank of which the state Housing Corporation is serving as the developer,” he added.

London property boom: Queen makes record profit

ROWN Estate, owned by Queen Elizabeth, said it made record profit in the year to March as a result of the strong performance of its central London properties. Crown Estate’s 5.2 percent rise in profits to 252.6 million pounds gives the queen a 38 million pounds 2014/15 payout, pegged at 15 percent of the total by a 2012 law designed to link her income to the UK’s economic health. The rest of the profits go to Britain’s Treasury or finance ministry. Owner of wind farms and most of Britain’s sea bed along with its Regent Street properties, the company has outperformed the wider economy due to strong overseas interest in London property and the UK’s growing reliance on green energy. “We are proud that another record Crown Estate performance will again make a strong contribution to the nation’s finances,” said Chairman Stuart Hampson. The company’s property portfolio is now worth 8.1 billion pounds. It is not allowed to borrow in capital markets and has formed joint ventures with overseas funds to finance its redevelopment plans.

32 — Vanguard, MONDAY, JULY 1, 2013

Insurance BRIEFS Natural disasters to cost $23 billion by 2050

HE annual cost of natural catastrophes in Australia will soar from $6.3 billion to $23 billion by 2050 because of population growth and increasingly extreme weather, a new report claims. A new focus on prevention and mitigation is needed, according to the Australian Business Roundtable for Disaster Resilience and Safer Communities. The roundtable – comprising the CEOs of the Australian Red Cross, IAG, Investa Property Group, Munich Re, Optus and Westpac Group – was formed last December to champion resilience investment. It says governments spend $50 million each year on predisaster resilience, compared with $560 million on postdisaster relief. Investing $250 million a year on resilience would cut relief spending by more than half and generate savings of more than $12 billion by 2050. The group says building more resilient homes in cycloneprone areas of Queensland would reduce the properties’ risk by 66 per cent and save $3 for every $1 spent.

Macroeconomic trends, slow growth rate threaten insurance industry

S insurers adjust to a new environment of lower asset returns and stricter regulation, macroeconomic trends and a slow growth rate top the industry’s risk agenda, according to a new report released today by Ernst & YoungBusiness Pulse: Exploring the dual perspectives of the top risks and opportunities in 2013 and beyond. The report states “Our research is based on a survey of executives at over 65 insurance companies across the globe, who shared their insights and perspectives on the factors driving the industry over the next five years. The study identified the top 10 most important risks facing the industry, along with the opportunities insurers can capitalize on. “In their search for growth and revenue, insurers need to optimize capital and asset liability strategies, remain cost competitive, while not losing sight of their customers’ needs.

Insurers underwrite N240bn business in 2012 STORIES BY

ROSEMARY ONUOHA

HAIRMAN of Nigerian Insurers Association, NIA, Mr. Remi Olowude, has said that the volume of business underwritten by the insurance industry in 2012 was estimated at N240 billion. Olowude gave the figure at the Association’s 2012 Annual General Meeting in Lagos last week. Olowude, who was represented by Mr. Godwin Wiggle, the NIA Vice Chairman said the figure represents 10.24 per cent increase against N217.7 billion recorded by the industry in 2011. He, however, said that the industry had continued to grapple with inadequate infrastructure and unstable weather which exposed insured assets to natural disasters such as floods. He said “The current performance of the industry has not been sufficient for it to reach the critical mass necessary to make the desired impact on the economy. The industry’s contribution to the nation’s Gross Domestic Product, GDP, remains at less than one per cent in 2012.”

Olowude said that the Association was reviving the Nigerian Oil and Energy Insurance Pool to improve the industry ’s oil and energy underwriting capacity. He noted that the Association organised 14 training programmes for its members in 2012 which

included collaboration with the GIZ of Germany to build capacity on microinsurance. The Chairman said that the Association had completed and started deploying the first phase of the Nigerian Insurance Industry Database (NIID) Motor Insurance Module. Olowude said that

From left: Mr. Fola Daniel, Commissioner for Insurance; congratulating the new President of the Chartered Insurance Institute of Nigeria, CIIN, Mr. F.K. Lawal while Lawals wife looks on.

IGI Ghana faces liquidation T

HE National Insurance Commission, NIC, Ghana, has secured a court order to take over the Industrial and General Insurance (IGI) subsidiary in their country. A report by B&FT, said the move has paved the way for the eventual liquidation and closure of the company ’s operations in the country. Information available indicates that the move by the industry regulator to close down IGI’s operations follows cash flow insolvency issues and operational difficulties faced by the company, which has made it difficult to settle and pay claims as they fall due. A source from the company said IGI has long indicated its resolve to divest from Ghana and allows NIC Ghana to take over the company. He said the decision to divest is as a result of irreconcilable differences between the company and the majority shareholders and its local Ghanaian directors.

delay in claims payment had reduced as its members continued to live up to their obligation of prompt claims payment to policy holders. Director-General of the NIA, Mr. Olorundare Thomas, said that the Association was working with the National Insurance Commission on the money laundering and terrorist financing programme. He said that the NIA had advised its members to take additional steps to preserve the integrity of the industry.

“But the point must be made that the company is not on liquidation at this moment. The court has only approved administrators for the companies for a period of six months, as agreed with NIC in Ghana, whilst the shareholders are resolving their issues,” he said. B&FT learnt the company’s financial situation has put the firm’s policyholders in a fix. It was gathered that the commercial court on the recommendation of the NIC has appointed President of the Ghana Insurance Brokers Association, Mr. Asante Marfo-Ahenkorah, and the Managing Director of Claim Limited, Daniel Afriyie, as administrators of the life and general insurance business of the troubled company in line with procedures to liquidate the assets of IGI after December this year. The administrators have been given a six-month duration to complete their work, and the cost that will be incurred through the administrators’

activities will be borne by the NIC and later reimbursed by IGI as instructed by the court. B&FT enquiries have revealed that all the general insurance policies held by the company ’s clients have expired, except life insurance policyholders who will be affected by the liquidation process. However, plans are being fashioned by the NIC, to transfer them to other insurance firms that are robust enough and interested to accept the life insurance business of IGI to enable clients to continue being served. IGI, a Nigerian-controlled insurance firm with particular focus on special risks such as oil and energy, engineering, aviation, and industrial risk management entered the Ghanaian market in 2008 when it acquired the operations of Network Assurance as part of its Pan-African expansion drive. The company on entering the market bought several shares of the publicly-traded SIC

Insurance Company. However, IGI’s underwriting profit has been awful and recorded several losses, drawing concern about the company’s entry strategy and focus. Adding to the company ’s woes has been infighting among the directors, which stalled recapitalisation plans. The NIC, whose mandate under the Insurance Act 2006 (Act 724) is to ensure effective administration, supervision, regulation, monitoring and control of the business of insurance to protect the insurance industry and policyholders, said its enforcement action against IGI has been necessitated by the company ’s violations of various provisions in the Insurance Act. The Administrators appointed by the insurance regulator are required to proffer recommendation to the NIC and lead court action against IGI Ghana Limited in a bid to protect the interests of policyholders, customers and the public; and preserve and prevent IGI from transferring, disposing of or dealing with any of its properties.

Vanguard, MONDAY, JULY 1, 2013 — 33

POWERFUL LIES: Familiar stories on blackouts whoppers, our leaders have tried to deceive us virtually all the time. Perhaps, on no single matter had Nigerians been told more lies, than on power generation, distribution and supply. And, they have all been great lies. The statement credited to Abacha’s Minister of Power and Steel was dug up from a thick file which had been maintained on the power sector in Nigeria since 1994. Reading further, the Daily Times report revealed that the reasons why the Federal government wanted to privatise the power sector at the time were the same advanced by the Obasanjo administration in 2001, the Yar’Adua government in 2009 and now the authorities under Jonathan in 2011 till date. There is no need to list all of them. Only one important reason overrides all the rest – inability of government to guarantee supply of gas to those power plants designed to use gas. Bearing in mind that

HE great masses of the people ..will more easily fall victim to a great lie than to a small one”, Adolf Hitler, 1889-1945, German Chancellor. (VANGUARD BOOK OF QUOTATIONS p 130). “Privatisation of electricity distribution in the country will come into effect next January, Power and Steel Minister, Alhaji Bashir Dalhatu said yesterday. DAILY TIMES, November 10, 1995. Hitler, one of history’s most horrible leaders and arguably the worst in the last century, discovered one secret which all bad rulers share. They run governments which lie to the people all the time. In fact, lying is the centre piece of government policy for such rulers. Fortunately, no Nigerian leader had come close to Hitler, perhaps because none of our leaders had a propaganda chief as inventive as Joseph Goebbels, 18971945. But, even though lacking in the genius for releasing

“

For almost twenty years, Nigeria had made very little progress on power – including the three years Jonathan had been in government

Abacha’s was a military and draconian regime, which had more powers to deal with saboteurs than any other since then, it is noteworthy that even that government admitted its impotence in this regard. Yet, without an iron-cast guarantee with respect to the regular and uninterrupted supply of gas, privatization will not solve our problem in the future. Instead of making this

confession, past and present governments have continued to deceive Nigerians that they were/are capable of providing regular and increasing supply of power over time. They have failed miserably and they will continue to fail as long as those gas pipelines remain as vulnerable as they are now. As the reader can see; for almost twenty years, Nigeria had made very little progress on power – including the three years Jonathan had been in government. That is the truth. Apart from using different words, the underlying attitude had remained the same as the following examples will illustrate. When Dr Ezekwesili, former Minister of Education challenged the government to explain what it did with $43 billion in external reserves, it met in 2007, one response came from Dr Reuben Abati, Senior Special Adviser to the President and a Ph. D holder. Writing under the title HYPOCRISY OF

YESTERDAYS MEN, Abati, among other things, asked the former Minister to disclose how several billion was spent when she was Minister. Furthermore, he went on to claim that the Jonathan administration, which began in 2010, met power distribution at under 2,000MW, and had increased it to 4520MW as at the time our erudite scholar was sending copies of that article to the media. It was intellectual dishonesty at its worst. Even, the worst undergraduate in any of our universities can see that Abati’s response failed to address the simple question: how was $43 billion spent? Furthermore, the President’s spokesman left the impression that 4520MW was being distributed steadily everyday when in fact that shameful feat was achieved for only a few days, and since then it had been the familiar story of less than 4000MW distributed every day – a target reached before Yar’Adua departed this world.

34 — Vanguard, MONDAY, JULY 1, 2013

Appointment & Promotion vicahiyoung@yahoo.com 08033348923

Odumodu heads African Organisation for Standardisation D

IRECTO- GENERAL of the Standards Organisation of Nigeria, SON, Dr. Joseph Odumodu has been elected President of the African Organisation for Standardisation, ARSO. In an election held in Cameroun, the new President will steer the continent’s umbrella body in charge of standardisation and quality assurance for the next two years. ARSO, 34 member countries with one vote each, had only 19 nations present at the weeklong event and General

Assembly, where the new president was elected. Odumodu contested the position with the DirectorGeneral of Malawi Bureau of Standards, MBS, Mr. Davlin Chokazinga, after the withdrawal of their counterpart from Sudan. In his acceptance speech, Odumodu said he would work with all the member nations of the organisation to tackle the problem of low industrial capacity for diversified manufactured goods. He pledged to steer the

Minister, textile union congratulate new TUC president M

INISTER of Labour and Productivity, Chief Emeka Wogu, has said the emergence of Bobboi Bala Kaigama as President of the Trade Union Congress, TUC, will further unite and build the Nigerian workforce through social dialogue; a veritable tool in national development. Similarly, National Union of Textile, Garment and Tailoring Workers of Nigeria, NUTGTWN, congratulated Kaigama, saying “politicians are encouraged to learn from your commendable free and fair election.” Wogu in a statement through Prince Samuel Olowookere, Assistant Director (Press) in the Ministry, extended the Ministry’s and Parastatals felicitation to the new officers of TUC while assuring them of his readiness to continue to partner with TUC in line with international best practices in the labour sector. He urged the Kaigama led administration to toe the line of established paradigm shift in government/labour relationship which emphasized a move from confrontational government/labour relationship to a dialogue based approach in resolving all labour related impasses. Wogu added that the administration of President Goodluck Jonathan was a pro-workers regime as demonstrated by its workers’ friendly disposition and policies, soliciting the continuous support of labour for the transformation agenda, aimed at job creation and national infrastructural development. On its part, NUTGTWN in a congratulatory letter to Kaigama by its General Secretary, Issa Aremu, said “On behalf of the National Executive Council (NEC) of the union and the generality of our members, we wish to formally congratulate you on your deserved election as the 7th President of the Trade Union Congress (TUC) at your recently concluded National Delegates’ Conference held at the International Conference Centre, Abuja on Friday 21st June, 2013.

•Odumodu continent towards efficiently managed standardisation and quality regime to boost Africa’s contribution to global trade from the current three per cent and 10 per cent of its intra-African trade. Odumodu called on other African countries to join hands with Nigeria in the battle against dumping which he said had been afflicting the economies in the region, negatively

According to him, “African countries have enemies who dump products on them at prices that make it difficult for African Countries to compete; enemies who dump radioactive products on us without our knowledge because we do not have sophisticated infrastructure to test”. Odumodu noted since African countries might not have the capacity to fight this onslaught as individuals, it would be advisable to fight it as a body. He said henceforth, ARSO would be using the auspices of the various regional economic blocs to marshal its plans and agendas, as it respond to international conspiracies. Also speaking, the chairperson of International Standards Organisation, ISO, committee for Developing countries, Mrs. Evah Oduor, lamented the low level of intra Africa trade which she said currently stood at 10 percent compared to Europe with 40 percent.

Chelsea bags 2012 gin of the year Award

FRICAN Brand Review, has named Chelsea London dry gin from the stable of International Distillers Limited, IDL, as the best gin for the year 2012. Other brands like Power Horse, Golden Penny Spaghetti, ArmorAll among others, won awards in their respective categories. Mr. Ayodele Joseph, Executive Secretary of the award committee, said the awards were instituted to celebrate outstanding brands with the view of helping them to grow. He said it was not easy for brands to outlive their owners or the generation in which they were introduced and so, it was imperative for all to appreciate brands that had been able to achieve such feat. In addition, he said that it was the organisers’ dream that African brands would be able to compete with its counterparts abroad. The parameter for the awards was based on the quality of the products, distribution network, customer satisfaction among other things.

Qlichy.com announces Akindele brand ambassador

Peter Esele, immediate past President-General and Bobboi Kaigama, newly elected President of TUC, after the election in Abuja.

NUPENG confirms Aberare General Secretary N

IGERIA Union of Petroleum and Natural Gas Workers, NUPENG, has confirmed Isaac O. Aberare, as its General Secretary. The confirmation was done at the last Central Working Committee, CWC, meeting in Lagos. Until his confirmation, he was the Acting General Secretary of the Union. Born on January 21, 1954, Aberare attended Ibru College, Agbara-Otor in Delta State, and worked at Trans Kalife and the defunct New Nigeria Bank Limited, NNB. He joined NUPENG in 1982 and rose through the ranks, holding the position of Senior Assistant General Secretary and Administrative Head of both Warri and Port Harcourt Zonal Councils of the union, before his promotion and transfer to the union headquarters in Lagos as Deputy General Secretary (Operations). He was promoted the Acting General Secretary in June 2012. Aberare attended many trade union education

BRIEFS

and leadership training programmes, seminars, workshops on industrial relations, health, safety and environment, locally and internationally, among which are ‘Organisational Behavior and Conflict, U.S.A., Conflict Resolution and Collective Bargaining at Dubai, United Arab Emirate. Other courses attended are leadership Development programme at Slough, London, U.K., Leadership Conclave for Union Executives and Labour leaders at Schaumberg, Chicago, South land, ILLinois U.S.A. Aberare is alumni of University of Benin and Ambrose Alli, University, Ekpoma respectively where he read for the Diploma Certificate and Bsc (Honours) degree in Public Administration. He is a highly experienced trade unionist with wealth of experience spanning over three decades with demonsratable leadership qualities that has brought succour and comfort to oil and gas workers.

• Aberare

AST growing online business networking platform, Qlichy.com, has announced star actress, Funke Akindele as brand ambassador. She was presented to a section of the media at a ceremony held inside the premises of the Quadrant Company in Ikeja, Lagos. Her presentation came on the heels of a successful official launch in April and a town storm campaign in May by the brand. Qlichy.com is a multi site business portal, news service and e-commerce platform which is linked to the Interswitch platform for payment purposes. The platform has been enjoying growing patronage and traffic since its launch in April. Qlichy.com offers access to platforms like BIZPOINT, TALKPOINT, SALESPOINT, PLAYPOINT and THOUGHTPOINT for businesses and consumers to meet and interact.

Vanguard, MONDAY, JULY 1, 2013 — 35

Agric The Minister of Agriculture, Dr. Akinwumi Adesina in a chat with the Governor of Ogun state, Senator Ibikunle Amosun at the opening ceremony of the 40th meeting of the National Council on Agriculture held in Abeokuta, last week. The Managing Director of the bank, Dr. Mohammed Santuraki in a chat with the Commissioner for Agriculture in Edo state, Abdul Oroh at the meeting in Abeokuta.

HE 40th meeting of the National Council on Agriculture and Rural Development held in Abeokuta, Ogun state last week was another opportunity for Dr. Akinwumi Adesina, the Minister of Agriculture, to reel out the efforts of the present administration at making the country sufficient in food production. Coming on the heels of the award given to Nigeria for achieving the Millennium Development Goal (MDG) 1 on hunger, three years ahead of schedule, Akinwumi Adesina said the country could not afford to be a net importer of food anymore. “Nigeria can no longer continue to be a sleeping giant. We have to wake up and turn Nigeria into a global powerhouse in agriculture,” he said. Adesina said the government is implementing a time-bound aggressive plan to unlock Nigeria’s potential to become an agricultural powerhouse. “Yearly, Nigeria imports over 11 billion U.S. dollars worth of wheat, rice, sugar and fish. However, Nigeria is importing what it can produce in abundance; this import dependency is hurting Nigerian farmers, displacing local production and creating unemployment. He explained that the vision of government is to make Nigeria an agricultural and industrialised economy, using a government-enabled private sector-driven approach,” he said. Speaking on the efforts of the government to use agriculture as a tool for economic development, Adesina disclosed that the Agricultural Transformation Agenda (ATA) introduced by the administration has been able to end age long corruption in fertilizer distribution in the country through the Growth Enhancement Support Scheme (GES). Nigerian Farmers’ net income has increased by 174 Billion

Our policies are to make Nigeria food sufficient — Adesina ...N591bn flows into economy so far By JIMOH BABATUNDE, with agency reports Naira due to the ATA’s activities in five value chains, Cassava, Rice (Dry Season and Rainy Season), Sorghum, Maize and Cotton. He said billion of Naira has been saved for the government through the policy, adding that the ATA is focused more on value addition with the priority areas as cotton, onion, tomato, sorghum, maize, soybean, oil palm, cocoa, rice, cassava, livestock and fisheries. Adesina disclosed the Federal Government had generated N591 billion from the cultivation of value-chains in rice, cassava, sorghum, maize and cotton within two years. CASSAVA On Cassava, Adesina disclosed that the country is the largest producer of cassava in the world and that the focus must be to make the country the number one processor as well as number one exporter . Export opportunities exist for dried Cassava chips ,as the World’s Leading Cassava

producer, Nigeria is Well positioned to benefit from the export market . He said China’s demand is sourced mainly from Southeast Asia: Thailand (54%), Vietnam (38%) and Indonesia (4%) , while Nigeria supplies less than 5% of volumes. “Nigeria has potential to become major global player within two years as dried chips preferred to South East Asia’s due to higher quality level. Adesina added that the Government has Secured 3.2 million MT Of contract orders for Nigerian dried cassava chips from Chinese importers, adding that based on existing contracts, Nigeria can earn between $802 Million and $1.37 Billion from dried chips exports to China and Europe “We must lift cassava from subsistence level to a major commercial and industrial crop capable of attracting big time investors and create about 1.2 million jobs to the Cassava Sub-Sector in Nigeria by 2015.” He listed some of the achievements in the cassava sector to include, 21,059 farmers

benefiting from distribution of 315,898 bundles of improved planting materials; standardization of recipe for cassava bread by three trainer organizations, namely: Park and Shop, FIIRO, and IITA, and Sweet Sensation and training of 385 master bakers in six geopolitical zones in the production of Cassava bread. HORTICULTURE On horticulture, the Minister of Agriculture disclosed that Nigeria is not a major horticultural produce exporting country, yet it is noted as one of the leading producers of tropical fruits and vegetables in the world. He regretted that less than 5% is processed in the country while 40 -51% account for wastage of the total output as about 55% is consumed fresh by Nigerians. “The overall objectives are to boost production and increase productivity – tomato from 850 tonnes/ha with national output from 1.86mt – 3.35mt annually, and bridge the deficit gap of 500,000 tons fresh fruits for domestic consumption.

BRIEFS

IFAD trains 9 on fish production in Jigawa

HE International Funds for Agricultural Development (IFAD) has sponsored nine people to Sabuwa Fish Farm in Katsina State to study how to produce fish feeds in Jigawa. The State Coordinator of the organisation, Alhaji Umar Abubakar, disclosed this in Dutse stated that the officials, who had finished the programme, were now stationed in Garki Local Government Area of Jigawa, teaching other farmers who are interested in fish farming. The coordinator said that the fish feeds were made from maize, ground nut cake, and soya beans starch and palm oil. Abubakar said that a farmer needed a minimum of N5, 000 to produce the feeds that would sustain the fish in his farm for about three months. ‘’This is far cheaper to the time when our farmers used to go to Kano or Kaduna to buy feed for about N40, 000 but now they need only N5, 000 to produce the feed,’’ he said. The coordinator said the gesture by IFAD was part of efforts to encourage fish farming and improve agricultural production in the state.

Rice farmers commend Kebbi Govt on fertiliser distribution

HE Rice Farmers Association of Nigeria (RIFAN) in Kebbi; have commended the state government on the method it adopted for the distribution of fertiliser to farmers. The Chairman of the association, Alhaji Muhammed Idris, who gave the commendation in Birnin Kebbi, said that the measures taken would stop fraud and diversion of the commodity. He said the distribution of the commodity at polling units would enable genuine farmers to benefit. The chairman said the association would ensure that only registered farmers share the 60 bags of fertilisers allocated to each polling unit across the state. Idris called on the rice farmers to report any case of diversion or improper conduct during the distribution of the commodity.

36 — Vanguard, MONDAY, JULY 1, 2013

Aviation BRIEFS Lamido commends Aviation Minister By LAWANI MIKAIRU

IGAWA State Governor, Dr. Sule Lamido has commended the Minister of Aviation, Princess Stella Oduah for her developmental strides in the aviation industry and praised her commitment and vision in turning around the fortunes of the industry, noting that the Agro-Perishable Cargo Export initiative by the minister would augur well for the nation. A statement by Yakubu Dati, General Manager, Corporate Communication, Federal Airport Authority of Nigeria, FAAN said the governor made the commendation when a team of Federal Airports Authority of Nigeria officials led by the Director of Cargo Development, Dr Rowland Ofulue paid him a courtesy visit at Dutse recently. The governor said that the uncommon commitment and vision of Princess Oduah was responsible for the success recorded in the sector, adding that the agro-commodities export initiative would yield economic benefits to the rural areas.

African Glass announces expansion

FRICAN Glass Ltd has announced the planned expansion of its glass operations in Nigeria. It intends to set up a state of the art float glass plant. The plant will have a capacity of 500 tonnes per day. The company and its European consultant have completed a market study in the last six months. The company will locate this new plant in Ogun State. The state of the art technology will be provided by a European supplier; negotiations are at the final stage. The spokesperson for the company Barrister Uche Iwuamadi stated that the $80 million investment would be the first step in their diversification into the float glass production arena to supply the Nigerian and West African markets. African Glass currently supplies glass for construction domestically and to neighbouring ECOWAS countries.

We want to eradicate culture of impunity in aviation — NCAA By LAWANI MIKAIRU

HE acting Director General of the Nigerian Civil Aviation Authority, NCAA, Dr Joyce Nkemakolam, says, the Authority will no longer tolerate the flouting of aviation laws by some airline owners and operators. And that the grounding of aircraft and suspension of operating licence of airlines can be avoided if aviation rules are obeyed. Speaking to reporters in his office at the Aviation House in Ikeja, Dr Nkemakolam said that grounding of airline can be avoided if operators adhered strictly to the regulatory requirements and rules guiding the airline operations without violations. “If there is no violation or flouting of these regulations of course, there will be no sanction. We want to eradicate the culture of impunity which some operators have penchant of taking liberty of. This has got to stop” He said the agency was planning to invite all operators and re sensitize them to adhere to regulations guiding their operations adding that once they follow all the regulatory requirements that grounding can be avoided. On private jets owners, Dr Nkemakolam explained that there were limitations and restrictions to the use of private jets for leisure adding that anybody flying with friends should be captured in their insurance policy. “If you have a Third party insurance policy you can fly with them. However, if you don’t, you are working outside the realm of your license. You must make sure that those you intend to carry are covered” On compliance by airlines to

the Aviation Revenue Automation Programme, the acting DG said there was a high level of compliance adding that a meeting has been held between the NCAA and

International Air Transport Association IATA on the process to collect the cargo taxes under the automation regime adding that the agency was tightening up loose ends.

From left: Maurice Phohleli, Etihad Airways’ General Manager, Nigeria and West Africa and Omokehinde Ojomuyide, MasterCard Vice President and Area Business Head, West Africa during the partnership signing event between the two companies in Lagos.

Nigerians should have seamless travel experience, says Emirates boss BY DANIEL ETEGHE

EGIONAL Manager, West Africa, Emirates Airlines, Mr. Manoj Gopi Nair weekend said Emirates Airlines was bent on ensuring that Nigerian passengers have seamless travel experience across the world. Speaking during an interactive session with newsmen in Lagos, Mr. Nair

pointed out that Nigeria is an important market in the West Africa sub-region adding that the airline has the needed connectivity for its Nigerian publics. He said ”The key focus area for us is about what our customers wants, ease of transactions. That is making it easy for them to be with us, give them a value for their money with a good product and services, you know making sure

Buba’s judgement on AIC land concession stands — FAAN

On airline recertification, he said NCAA will soon embark on recertification of all AOCs issued pre 2009 adding that those that were issued post 2009 don need to recertification.

EDERAL Airport Authority of Nigeria, FAAN, has said that the judgment of Honorable Justice Buba of the Federal High Court Lagos on June19, 2013 in respect of AIC land concession involving FAAN has not been set aside by any other court and so, AIC limited cannot claim to be in possession of the controversial land. .Yakubu Dati, Coordinating Spokesman, Aviation Parastatals ,revealed in a statement that ‘’ The attention of the Federal Airports Authority of Nigeria has been drawn to a press release by AIC Limited, claiming that it remained in full possession of the project site for its controversial hotel project at the Murtala Muhammed Airport, Ikeja, dispite the judgment given in three

consolidated suits, related to the concession, in favour of FAAN by Honorable Justice Buba of the Federal High Court Lagos on June19, 2013.’’ Dati further said ‘’We hereby advise members of the public, especially aviation stakeholders, to disregard such untenable claims by AIC Ltd designed to pull wool over their eyes, and assure them that the ruling by Hon. Justice Buba on that land concession still stands.’’

‘’We wish to assure the public that as a law abiding and responsible corporate citizen, the Federal Airports Authority of Nigeria will not engage in any act that would amount to disrespect to the judiciary, in the same way that we shall not allow any unruly concessionaire to trample on the collective right of all Nigerians, which FAAN represents on this issue.’’

that our customer based connects well to the network that we have got as well as making sure that our vast network is connected to Nigeria with the aim of giving Nigerian passengers a seamless travel experience” ‘’From my side what we have started looking at is, the ease of doing transactions in Nigeria, we are looking at various options through which we can make international connection through interconnectivity while working with a Nigerian partner like Arik Air to make things easier particularly from the Lagos Airport and we see Nigeria as a hub and those are the areas that we are looking at and making key collaboration with viable stakeholders in the industry” he added. According to him, Nigeria is a viable market in West Africa noting that Emirates Airlines was making sure that Nigerian passengers were been connected to the vast network of the airline in the East, West and even in the South-East Asia with a great value for their money.

Vanguard, MONDAY, JULY 1, 2013 — 37

38 — Vanguard, MONDAY, JULY 1, 2013

ICT

Intel lauds sacrifice of Women in ICT By PRINCE OSUAGWU

NTEL corporate communications Manager Mr Osagie Ogunbor had revealed that one of the major problems why women are disconnected with ICT and digital literacy is mainly not about interest but about tight schedule due to so many activities occupying the Nigerian woman. He however commended some of the women who have braced the odds to play in the Information and Communications Technology fields, saying that it was a great sacrifice. Ogunbor in an exclusive chat with Vanguard said that “women who are bracing the technology at the moment do so out of sacrifice. Our advise is that more women key in on the potentials of ICT so as to make their businesses and even their home chores very easy. For him, this realization is what made his company, Intel corp to come up with digital training for women, which he said is at the moment yielding a lot of interests and benefits.

MTN donates digital libraries to round off 21 days of Y’ello Care By ADEBADE ADEJIMI

TN Nigeria, last week ended the 2013 edition of its annual staff volunteerism programme, 21 Days of Y’ello Care, which focused on education. The annual programme, initiated by the MTN Group in 2007, encourages MTN staff in all its 21 operating countries in Africa, Asia and the Middle East to volunteer their resources, time and skills to assist others and the communities where they live and work. Chief Executive Officer, MTN Nigeria, Mr. Brett Goshen, noted that MTN Nigeria through the programme has contributed its quota towards improving educational standards, providing an enabling environment for learning and instilling the pivotal role of education in the development of the nation.

Much research goes into samsung's products — Oyelayo, Head, IT Samsung W/Africa The office appliances market is becoming fascinating especially as research players come up with innovations that delight consumers. Samsung, a player in digital media and convergence technologies, recently introduced All-in-One desk top PC Series. Mrs. Folashade Oyelayo, Head, IT Solutions for Samsung West African market told PRINCEWILL EKWUJURU that the PC is a hybrid of a desk top, with the CPU, the monitor in one box unit. Excerpts. About the PC he PC is a hybrid of what you call the desk top. It is has the CPU, the monitor as one box unit. With the PC,the user doesn’t require a CPU and monitor separately. The unique thing about the Samsung All-in-One PC is that it comes in different sizes and it has some

interesting features like all touch function, a user can use his ten fingers. If you have been using some taps you noticed that you can use only one finger, if your finger holds, the user may not be able to use another finger to punch. But with the new PC all the ten fingers can work differently on the screen, it is a unique product. Building on the premium aspects of the Samsung Series 9 Notebook, the new All-InOne (AIO) PC inherits Samsung’s advanced engineering craftsmanship with highly finessed and stylish design. Beyond high performance, the new Samsung AIO PC Series 7 has been crafted to deliver an entirely new AIO PC experience. Other players with similar system We must create awareness of the product. With competition of similar product in the market, Samsung has strong advantage. The unique thing about Samsung All in One desktop includes the ten touch finger function, voice recognition. What we have done is to incorporate more features into the Samsung unit that will make it user friendly. You will be interested to know that kids will enjoy it awesomely. The unique features we added will give us an edge in the market and our positioning is to engage the media and there are other plans in the pipe line as it concerns creating awareness. Windows series It comes in Windows 8. It is Windows 8 that really supports the touch function. The interesting thing about Windows 8 is that if you are comfortable with Windows 7 platform, it has both platforms.

All you need to do is to click Windows 7 platform and w o r k seamlessly as you want. Windows 8 is a very good platform to work on. It is designed for easier interaction. The system as laptop You cannot carry it around because of its weight. If you remove the stand you can mount it on a wall. The range of the keyboard and mouse to the PC is about three meters. It can go as far as the eyes can go working with the system. Challenges and Nigerian market In any product launching there is always a challenge and the only challenge we see is the ability of Samsung to communicate effectively for people to know much about the good product. What I know is that there is no individual who has talked about the product and desirous about buying a desktop and see this product without admiring it and buying it. We will move as much as possible to position the product in the Nigerian market. We have platforms like billboards, jingles and press adverts to really engage consumers. Target market We are focusing in Nigeria. Interestingly we have other offices that cover other West African countries. Sizes and price ranges In Samsung, we really don’t believe in talking about prices. This is because we bring the value to the table. If you ask me

Mrs. Folashade Oyelayo

BRIEFS

In Samsung, we really don’t believe in talking about prices. This is because we bring the value to the table.

what my price is like compared to competition, I will tell you that my price is reasonably very competitive as regards what I am offering. What I am offering is superior in the market. Product development and market research What Samsung looked at is the market gap. Before Samsung launches a product; there is so much research that goes into it. If you go to our retail shops you will observe that we have unique selling point for the products. This product was in response to filling a gap. The product initiative started about two years. Motivating factor The motivating factor is innovation and that is why

Samsung invests so much in research and development. We come out with products that meet the need. We don’t just churn out products, but we look at what meets consumers' need. On examining what makes life easier, we come up with the product. And that is why the products are hit whenever they come out because they are produced to meet needs. Nigerian and African market Interestingly, the Nigerian market is not yet matured but it is fast developing. The reason is that here we are not retail oriented. This PC is a retail product. It is a product that will be in stores where people will walk in and feel it and take it home. If you want to buy a product in some markets, the man selling it may not even open it for you to see what you are buying and the features. That kind of marketing does not help. Desktop market Just as Samsung is, we bring the best of our innovation into any market we operate. Desktop market is fast eroding. Be that said, people still need to have that desktop feel. Instead of having a clutter of wires and cables in the office or home, you now have one main box on the desk. This makes everywhere tidy and gives the office class on its own. PC sizes It is for corporate environment and much more for families. There is a syncronisation between all Samsung products. All in One is such that when you have a Smart phone, you can have the Samsung all share function that makes it to work. In a home, for example, if the family has All in One PC in the home and the father has the smaller tablet and the mother has a smart phone and the children have phones. All of them can all link up and access their information from the All in One at home. So wherever any individual is so far the systems are linked with home Sync, anybody can see the information. Hard disc size and speed The speed is high. The graphic is awesome, even the graphic engineers and companies will like the product. It has 1000 gigabyte disc which is big and enough for any application. Does the PC has wired keyboard and wired mouse. The keyboard and the mouse connect wirelessly with the unit. A user does not need the cabling challenges that people always face with desktop. Apart from that, it comes with high spec. The processor is a third generation processor.

Vanguard, MONDAY, JULY 1, 2013 — 39

Advertising, Media & Marketing

Oyo ad agency tasks govt on environment aesthetics Stories by PRINCEWILL EKWUJURU

HE Director General of the Oyo State Signage and Advertising Agency, OYSAA, Mr. Yinka Adepoju, says that for foreign direct investment (FDI) inflow, state governments should make their environment aesthetically appealing. Speaking at a seminar organised by the Advertising Practitioners Council of Nigeria, APCON, in Kano on the topic: “Use of Out-of-Home Platforms in Public/ Corporate Communications: Challenges of Effectiveness and Environmental Protection,” Adepoju said the environment speaks volume about what a state is. He noted that poor state of the environment affects quality of life and remains a yardstick for the civility of the society, “hence we must combat disorder and chaos of unplanned and haphazardly erected outdoor advertising structures.” He went on to say that a critical look at the use of outof- home platforms in public and corporate communications in some major cities are nothing

to write home about outdoor advertising structure of various types,shapes and sizes, which he said are haphazardly erected and many of them are in deplorable conditions. Further, the Director General said that some of the structures were constructed with substandard materials; some dilapidated and faded, while some were not properly

positioned and some with badly torn posters, as some are completely broken down. Continuing, he said: “Chaotic situations like these will cast aspersion on this very important medium of communication, its practitioners, the users, (Advertisers), government and the public, and must be collectively combated.”

He, pointed out that another serious challenge was practitioners’ inability to adapt or adopt necessary and useful changes as it were. “What we see on some of the major roads in our cities are conventional boards. We should by now have adorned our streets like other developed parts of the world with cutting edge technologydriven media solutions commensurate with international standards and best practices via the introduction of LED electronic display technology, not minding our limitations, which arise from epileptic power supply.”

BRIEFS Panasonic unveils AVS built-in Air conditioners

anasonic has unveiled its new range of room air conditioners, which comes with automatic voltage switcher system (AVS) to protect important component such as the compressor from severe voltage fluctuation. According to the manufacturers, the innovation is introduced to tackle the Africa’s key challenge of voltage fluctuation, air purification and energy saving. New nanoe-G will enable to deactivate 99 per cent of bacteria and virus attached to filter while intelligent EcoNavi sensor will save up 35 per cent energy without sacrificing the comfort level.

ADVAN holds AGM in Lagos

From left: Mr. John Woma, Media Consult; Mr. Suraj Rupani, Promoter, Panaserv Nigeria Limited; Mr. Hiro Hiyama, Panasonic Corporation, Japan and Mr. Mochizuki Kota, Panasonic Marketing, Middle east Dubai at the launch of Econavi Built in Automatic Voltage switcher Airconditioners held in Lagos recently.

How MTN's project frame helps youths rediscover themselves E NTERTAINMENT may be the main aim of staging a musical reality show, but there are other benefits attached to the venture. The benefits include helping youths to redirect and discover themselves their talents, jobs creation and developing other sources of revenue for private business owners that include artistes’ managers, producers, fashion designers, music directors, graphic designers etc. It will surprise the fanatical audience of the MTN Project Fame West Africa to discover that over one billion Naira has been spent on the empowerment venture just to give the sub-region’s youths the opportunity to become super-stars and the reality show has well surpassed expectation barely halfa-decade in Nigeria. In that wise, like the popular Chinese proverb, ‘Teach me how to fish, don’t just give me fish’, the venture has given not less than 20 youths a life-time support, by equipping and nurturing them with the basics for attaining musical stardom. Apart from having a share of the large sum of money running into billions in the past five years, the rookies of yesterday, have grown to earn global acclaim as well as risen in value to rake in as much as a million Naira per in concerts. And they certainly feature in many concerts and tours these days. Prominent among them are Iyanya, Chidimma, Kesse and Praiz.

These young people have built a career which has seen them employ managers, legal advisers, choreographers, back-up singers and body guards who they pay, monthly. Their present status hardly correlate the financial reward back then in the academy. For them, the intangible classes of rare musical training and orientation were more important than money or cars. Of course, they were right. Aside the artistes, there are several others who benefit greatly from the venture. Every year, the MTN Project Fame is transmitted to at least 20 million people in West Africa. In real terms that is equal to the entire population of Ghana. But, aside that, the audience know that a lot of planning, spanning hours or days, had gone into what they see as a finished production in their homes. For each show, several firms come together to brain-storm before adopting the right strategies and blue-print that can lead to a hitch- free production. Some of such firms are event management companies. This private set of people specialise in locating a fitting venue, decoration, crowd control, refreshment and technical details that involve creating the right atmosphere for occasions. For Project Fame, the firms receive close to 200 million Naira in hosting events, yearly, in support of the reality show. They employ close to a hundred personnel who render different services in return for fat professional fees.

Adrenaline Band is a delightful troupe that comprises talented singers, who serve as back-up for contestants during performances in the academy. Each season, they provide matchless musical accompaniments and vocal support for different youths, with diverse vocal range. They earn so much doing this. At least 50 choreographers participate in the reality show yearly. For the enlightened mind, certain songs need to be blended with craft or physical artistry that warrant contracting professional choreographers, who either dance or perform acrobatics to match the contestants various renditions and peculiar musical offerings. This group is paid handsomely to perform. There are also costumiers, who attend to contestants and judges, who form the focal point of the show. In creating the right face that matches the camera, costumiers put in a lot of creativity right down to choosing fitting clothing for each performance. For their services, these individuals earn a tidy sum each year. The contestants are dressed to suit their physique as well as match the songs they are rendering. Interestingly, this is one of the many areas where the show stands out. One outfit costs, at least 50 thousand Naira. There are others that cost a 100 thousand Naira or more. Each year, popular clothing lines are contracted to clothe the contestants. The contract is worth millions of Naira.

he Advertiser Association of Nigeria (ADVAN) has concluded plans to hold its 15th Annual General Meeting (AGM)in Lagos, which will coincide with the association’s initiative for professionals to learn, network and socialise, tagged “Marketers’ Evening’. According to the Executive Secretary of ADVAN, Ediri Ose-Ediale, the exclusive ‘Marketers’ Evening’ is a platform for industry professionals to learn, network and socialise She said the objective of the ‘Marketers Evening’ is to advance marketing decisionmaking by disseminating unique insights to ADVAN members, as well as bring members together with industry thought leaders to develop new ideas, and facilitate industrywide networking.

...OAAN too

he Outdoor Advertising Association of Nigeria, OAAN, said it will be holding its Annual General Meeting, AGM, in Ijebu ode, Ogun State come July 2013. A statement signed by the Secretary of the Association, Mr. Emmanuel Ajufo, said the AGM is scheduled to hold from 4th through 7th July, 2013. According to Ajufo, part of the agenda to be discussed at the meeting will include receipt and consideration of the reports as presented by the General Secretary and treasurer of the association on the audited financial statements of the association.

40 — Vanguard, MONDAY, JULY 1, 2013

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£3,000 UK VISA BOND: Is government huffing and puffing?

IGERIANS were recently agitated by the British government’s proposed demand for a £3000 bond as prerequisite for the issuance of a six-month visa for visitors from Nigeria, and five other Commonwealth countries to the United Kingdom. The British High Commissioner, on his side, noted that the financial bond was a way of tackling abuse of the UK immigration system. In an attempt to assuage the concerns expressed, the UK mission advised that, the bond would only affect a small number of the highest risk Nigerian visa applicants, and those who do not violate the original terms of entry would receive a refund on return to Nigeria. However, critics observe that the conservative party in the UK hopes to reap political, security and financial benefits from the ‘visa bond’ policy, when effected. In recent years, the results of elections in several European countries have been critically influenced by a swelling demand by electorates for tougher immigration policies, as indigenous European populations become seriously concerned about what they consider as the threat of liberal immigration policies to their culture and social welfare. It is also expected that the requirement for a visa bond would enhance security by selectively reducing entry to potential fundamentalists and terrorist materials. Thirdly, critics also, see a ‘parasitic’ financial benefit in the proposed policy. For example, the British High Commission confirmed that over 180,000 Nigerians apply to visit the UK annually; in reality, with current visa fees of about N20,000, this would translate to

over N3.6bn annually; i.e. a sizeable revenue source that may, in fact, be adequate to run the UK mission in Nigeria. Indeed, if each visa applicant pays the new bond price of £3000, the British treasury will forcibly collect over £540m from Nigerians. Furthermore, if only 10 per cent of applicants pay the £3000 bond, this would still mean an interest-free loan of about £54m from economically beleaguered Nigerians, just for the joy of visiting a Commonwealth nation, which arguably became sumptuously endowed from the sweat of the people and wealth of its former colonies. Curiously, francophone countries, from whom the British derived minimal capital, and indeed, other politically more volatile Arab states have been exempted from the visa levy. Incidentally, there is no indication that the bond refunds would earn any interest for the six months ‘loan’ to the UK government by Visa applicants. It is also not yet clear what currency the Embassy will demand as settlement for the £3000 visa bond! Currently, several foreign missions are very clear about the quality of naira denominations that are acceptable for settling their receipted fees. Expectedly, both the Nigerian and Indian governments have cautioned the UK about the implications of retaliatory measures; Ambassador Gbenga Ashiru stressed that Nigeria

might also impose the £3000 visa bond on British visitors. However, the Nigerian threat may not bring much comfort to long-suffering Nigerians, who have witnessed dramatic government somersaults on such issues in the past. for example, since the Aviation Ministry threatened fire and brimstone over the oppressive airfares charged by British

If each visa applicant pays the new bond price of £3000, the British treasury will forcibly collect over £540m from Nigerians

Airways between Nigeria and Britain, regrettably, nothing more has happened, and the initial yell of protest has become less than a whimper; meanwhile, Nigerians continue to pay what some describe as selective extortionist rates to British Airways. The threat is that if the Uk succeeds in its bid, other countries may also demand visa bonds from Nigerians. Instructively, however, even if Nigeria also makes good its threat to

reciprocate the £3000 bond, visa applications from British citizens, the revenue inflow will still be a far cry from the payment by over 180,000 Nigerian applicants for UK visa.

eaders will recall that Nigerians have not always been unpopular visitors to the UK; for example, before 1985, I embarked on at least two visits to the UK without a visa issued in Lagos; the visas were ultimately issued without any fuss or harrowing demands at the point of entry at Heathrow airport, Curiously, on one occasion, the immigration officers were alarmed that I wished to spend only a week in the UK, and therefore encouraged me to spend longer time and enjoy their beautiful country. Surprisingly, in spite of my reluctance to extend my visit, I was still given a sixmonth visa. Curiously, even when Nigeria was a pariah nation as a result of military rule, Nigerian visitors were still gladly welcomed because the big spending appetite of our people was sweet music on British High streets. (Incredibly, our foreign reserves were below $5bn then, but the naira exchanged almost at par with the British Pound Sterling, and wage levels and job opportunities in Nigeria were relatively better than elsewhere!). Not surprisingly, the commercial bond of friendship gradually began to wane as the naira exchange rate literally crashed on the

adoption of the IMF-sponsored Structural Adjustment Programme, and several industries closed shop as raw material costs escalated; evidently, the popularity of the Nigerian tourist has over time become negatively adjusted in consonance with our ‘sick’ naira. The collapse of the Nigerian economy and abiding doubledigit inflation rates over many years have led to reduction in job opportunities and ultimately also opened the floodgates for Nigerian job seekers, some of whom embark on suicidal journeys across deserts and oceans to the UK and elsewhere. Paradoxically, we are encouraged to celebrate the cash inflow that comes as personal remittance from the employment of Nigerians in the diaspora; whether or not this cash inflow compensates for the attendant antisocial impact of brain and manpower drain on the economy is another question entirely. Painfully, also, according to a report credited to Governor Olusegun Mimiko, Nigerians still spend over N80bn ($500m) annually, to train our young ones in UK educational institutions. Worse still, the beneficiaries of this sacrifice will remain reluctant to come back to Nigeria after the completion of their studies, because of the scarcity of jobs as well as the foreign exchange valuation of the existing wage structure. SAVE THE NAIRA, SAVE NIGERIANS.

Business & Economy

N12.5bn rights issue: Shareholders back Sterling Bank

shareholders and shareholders’ groups, as they have indicated interests in picking up their

NGOING rights issue by Sterling Bank Plc has been backed by individual retail

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rights and mobilizing other shareholders to support the recapitalization programme of the bank. The expressions of interests and supports from minority and retail shareholders reechoed the unanimous endorsement of the bank’s capital raising programme by shareholders at the recent general meeting. Non-core shareholders, with less than five per cent equity stake, including a large number of minority retail shareholders of more than 88,000, collectively hold about 65 per cent equity stake in Sterling Bank; underlining the highly diversified shareholders’ base of the bank. Most retail shareholders are spread in groups and other representations.

A broad section of shareholders’ groups, representations and individuals interviewed in relation to the rights issue said they would pick up their rights and mobilize others to take advantage of what they described as “a window of opportunity ”. Several shareholders indicated they would demand for additional shares, raising prospects of oversubscription. The supports from non-core shareholders strengthen the prospects for the rights issue, which had earlier received firm commitments from major Nigerian and foreign shareholders including the State Bank of India, Dr. Mike Adenuga, Alhaji (Dr.) Suleiman Adegunwa’s Ess-ay Investments Limited and other

directors. Sterling Bank is raising N12.5 billion through a rights issue of about 5.889 billion ordinary shares of 50 kobo each at N2.12 per share. Sterling Bank had traded at a high of N3.05 at the stock market. The shares have been pre-allotted on the basis of three new ordinary shares of 50 kobo each for every eight ordinary shares of 50 kobo each held as at May 20, 2013. The application list, which opened on June 24, 2013, will run untill July 31, 2014. According to the President, Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr. Faruk Umar the rights issue came at the right time and at the right price.