Financial 02052016

MAY 2, 2016

Banks cut interest payments to customers by N44bn Net interest margin rises 13% It's gross milking of customers — BCAN

By BABAJIDE KOMOLAFE

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nterest rates received by customers of nine banks dropped by N44 billion between March 2015 and March 2016.

On the other hand, seven banks increased interest collected from customers by N16.8 billion within the same period.

These were revealed by the unaudited banks’ financial results for the first quarter ended March 31st 2016 (Q1 2016) released by the banks.

Among other things their results showed that the difference between interest collected from customers and interest paid to customers (net interest margin) rose by 13 percent or N39.8 billion in Q1 2016 to N344.5 billion from N304.7 billion in Q1 2015.

The banks are UBA, GTBank, Access Bank, Zenith Bank, FirstBank, Ecobank, and Union Bank. Others are C M Y K

Diamond Bank, Sterling Bank and Wema Bank.

Interest paid by nine of the ten banks to customers dropped sharply by 22 percent to N156.2 billion in Q1 2016 from N200.5 billion in Q1 2015.

On the other hand, seven banks increased interest they collected from customers by N16.8 billion or 5.6 percent to N332.2 billion in Q1 2016 from N315.4 billion in Q1 2015.

Gross milking of customers “It is a gross milking of customers of bank”, said Mr. Uju Ogubunka, President, Bank Customers Association of Nigeria (BCAN), In an interview with Vanguard, he said, “Banks are improving their profitability at the expense of customers. It is because we have a seller’s market, where take it or leave is what is happening. What is going on is anti financial inclusion that we are all working towards”.

“This is not a good trend”, said Mr.

Muda Lawal, Director-General, Lagos Chamber of Commerce and Industry.

Speaking with Vanguard, he said “This is not new, it has always been like that because in Nigeria the spread between deposit rate and lending rate is about the highest among what you can find anywhere else in the world.

Banks are improving their profitability at the expense of customers. It is because we have a seller’s market, where take it or leave is what is happening

The disparity is too much, how much they pay on deposit and how much they charge for lending.”

Interest paid by customers Analysis revealed that customers of FirstBank, Zenith Bank and UBA suffered more reduction in interest payment, while customers of Wema Bank enjoyed increase in interest payment.

First Bank reduced interest payment to customers by N16.2 billion or 36 percent to N19.6 billion from N35.8 billion, while Zenith Bank reduced interest payment to customers by N12.8 billion or 33 percent to N26 billion from N38.8 billion. UBA on its part reduced interest paid to customers by N7.4 billion or 27 percent from N27.9 billion to N20.5 billion. Wema Bank however increased interest paid to its customers

by N900 million or 19 percent to N5.6 billion from N4.7 billion.

Interest collected from customers Analysis revealed that seven banks increased interest they collected from customers while three banks reduced interest they collected.

The banks that increased interest Continues on page 18

18 — Vanguard, MONDAY, MAY 2, 2016

Cover

Empowering Nigerian Women: Strategies, Insights, Ideas

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AGM: From left, Mrs Oyinda Ehiwere, Company Secretary, FSDH Merchant Bank; Mr. Osaro Isokpan, Chairman and Dr. Rilwan Belo-Osagie, MD/CEO FSDH Merchant Bank Limited,during the AGM of FSDH Merchant Bank in Lagos.

Banks cut interest payments to customers by N44bn Continued from page 17 collected from customers are GTBank, Access Bank, Zenith Bank, Ecobank, Union Bank, Sterling Bank and Wema Bank.

FirstBank, UBA and Diamond Bank reduced interest collected from customers.

Access Bank and Wema Bank led the increment in interest collected from customers, with 19.4 percent and 8.9 percent increases respectively. Access Bank increased interest charged

by N9 billion from N46.4 billion in Q1 2015 to N55.4 billion Q1 2016, while Wema Bank increased interest charged by N800 million from N8.9 billion to N9.7 billion. Union Bank came third with 4.9 percent or N1 billion increases in interest collected from customers from N20.5 billion to N21.5 billion.

On the other hand, FirstBank reduced interest collected from customers by N11.8 billion to N83.5 billion in Q1 2016 from N95.3 billion in Q1 2015.

Diamond Bank reduced by 11.9 percent or N4.8 billion from N40.5 billion to N35.7 billion while UBA reduced interest rate collected by N3.8 billion or 6.7 percent to N54.9 billion from N58.7 billion.

Customers deserve a better deal LCCI Director General, Muda Lawal averred that customers deserve a better deal in terms of interest payment customers.

He noted that, “Whenever there is an upward review of the Monetary Policy Rate (MPR), almost instantaneously the lending rates will be reviewed upward. But if it was a reduction, they hardly advise their customers that the MPR has been reduced, our lending rates have gone down by this percentage.“But you know it is a free

market because the banks also argue that they incur a lot of non-interest cost, on providing generators, security, providing mobile police. They argue that these are also major component of their cost. But I think that bank customers should have a better deal than they are having now, despite the non interest cost. If you look at the kind of profit they declare, though it has been going down. It shows that there is still room for them to give customers a better deal as far as cost of funds is concerned. So we have to continue to use combination of subtle regulatory pressure and moral suasion for them to at least a better deal.

CBN has a role to play BCAN President, Mr. Uju Ogunka noted that the CBN has a role to ensure customers get a better deal.

“CBN should insist the banks do the right thing. You can’t be asking people to bring their

money to the banks, and then you keep charging them fees that are exceptionally too high or unfounded. You will be discouraging them”, he said.

He added, “The regulators should monitor what the banks are doing, because it does not appear as if they are doing so much in that regard.

Again bank customers also do not monitor their accounts, to know what is going on whether it is in line with the policy of the CBN. CBN should educate banks’ customers to know what to expect. CBN should also ensure there is proper monitoring of these banks. It is not this periodic thing the do there must be a way they monitor these things. For instance banks publish their interest rate, but how often does the CBN cross check to ensure that what the banks publish is in line with what is in the offer letter to their customers. Nobody does that.”

CBN disburses N6.4tn loans to commercial farmers

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he Central Bank of Nigeria (CBN) says loans to banks under its Commercial Agriculture Credit Scheme (CACS) stood at N6.4 trillion as at Dec. 31, 2015.

The bank disclosed this in its 2015 Annual Financial Report posted on its Website.

It reported that the figure increased from N5 trillion in 2014.

According to the report, the apex bank’s net income grew to N123.07 billion in 2015 from N33.6 billion in 2014, representing a 266.3 per cent increase. It said that its interest

income rose from N434.77 billion in 2014 to N567 billion in 2015, an increase of 30.4 per cent.

The apex bank said that its operating expenses rose by 42.8 per cent from N433.14 billion in 2014 to N618.85 billion in 2015.

It said that the total assets of the bank as at Dec. 31, 2015 stood at N15.5 trillion from N13.7 trillion in 2014. The figure represents an increase of 12.5 per cent in the period under review. Also, the liabilities rose by 12.9 per cent to N14.897 trillion in 2015 as against N13.192 trillion posted in 2014.

hen women are fully account. *Minimise failure – rates for involved, the benefits can be seen immediately: enterprises involving women families are healthier and through on-going technical better fed; their income, and financial assistance, with savings and reinvestment go in-built frame work frame up. And what is true of work for efficiency monitoring families is also true of and continuous survey. *Improved communication communities and, in the long run, of whole countries (Kofi and co-operation between women entrepreneurs across Annan) International observers and related sectors to assist aid agencies frequently cite creation of resources pools the case of Africa’s most and sharing of expertise and populous nation when it technical support. *Improved accountability on comes to highlighting women’s issues. Nigeria’s women’s issues at both states future growth prospects are and federal levels through of official irrevocably tied to the status evaluation of its women and its ability to programmes.

These points are by no adequately leverage their considerable economic means exhaustive in terms of the issues facing Nigerian potential.

In this light, the following women, but they do outline in are some of the key issues the broad strokes the efforts country ’s government and necessary to successfully policy makers need to explore: empower and include them in *Legal reforms the process of sustainable guaranteeing equal rights of growth. Despite their past and present woman to condition, ownership, N i g e r i a n property and women hold financial one of the keys control, social Nigeria’s to the country’s reforms to longterm e n f o r c e future prosperity. h u m a n e growth Nigerian treatment of women have women and prospects just as much t h e i r are innate chance worthwhile as Nigerian irrevocably participation men to succeed in the tied to the in the world of development status of business. of their However, there families and its women are barriers communities. between women *Development and success, of special chief among entrepreneurial initiatives that focus on which is the mentality that unbiased participation of women are inferior to men. women in gainful enterprises Women are impoverished and make adequate because of socio- cultural and allowances for their socio – institutional barriers stacked cultural, economic and legal against them. For example, the economic condition of the constraints. *Redrawing budgetary country has forced most poor allowances and state parents to prefer the expenditure outlays to education of the boys rather specifically improve gender than girls despite a equality and promote subsidised public education increased participation of system. And in an economy women in new and existing with high unemployment rates, women suffer more as entrepreneurial activities. *Enhanced collaboration they are regarded as less between women and credible applicants for financial, policy and aid government and corporate agencies through innovative jobs. Thus entrepreneurship models that takes women’s offers one of the few viable lack of formal training and options for women for business expertise into economic empowerment.

Vanguard, MONDAY, MAY 2, 2016 — 19

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n a Presidential system of government, political theorists have long propounded that separation of power is the chess game at the political arena. It is a known fact that the executive, the legislature and the judiciary act as checks and balances on each other in the system. In budgeting, while the executive proposes the budget, the National Assembly has the responsibility to debate and pass the budget into law for the executive to implement. It is a fact that in several instances, budgets are held up because of disagreement either on provisions or in the principles and policies enunciated in the budget proposal.

In the case of Nigeria’s 2016 budget, the National Assembly was accused of padding the federal budget by N500 billion above the revenue projection and the built-in deficit, thus making it impossible for the President to implement going by the current fiscal situation in the country, if signed into law.

All along, the House of Representatives was ready to reconsider the budget when the Executive cried foul when the details were submitted, it was the Senate that insisted that the President must first assent to the Bill as passed and thereafter bring forward areas of concern in a Supplementary Bill. This position was said to have put the President off, prompting his insistence that he would not sign a budget he was not likely going to implement. President Buhari had insisted he made a pledge to Nigerians and would not go against that pledge no matter the pressure. He said he could not honestly implement the budget as presented, and signing it will amount to not only deceiving himself but Nigerians because the budget is not implementable.”

The President’s position was based on his earlier experience with some officers of the National Assembly who would agree with him on some issues and later renege just to blackmail him. He cited two earlier issues on the same budget: “There was an agreement that since there are errors and omissions in the budget because of the shortness of time during which it was prepared, that it

Is the National Assembly a budget rubber-stamping body? should be taken back and corrected. The next thing that was heard was that the budget was missing.

That development thoroughly embarrassed the President. It happened again when the corrected version was presented and they now claimed they had two budgets.” The Special Adviser to the President on Media and Publicity, Mr Femi Adesina, on his Facebook wall had posted that the President would not be rushed into signing the budget unless it was delivered in a format that could be successfully implemented in line with the administration’s strategic agenda.

What Nigerians have not heard is whether the so called padding was altruistic or selfish in nature because the National Assembly has been traumatized with corruption allegations and in actual fact, many have seen the action of the lawmakers as selfcentered. Looking at the accusation, it seems the executive wanted its budget returned to it the way it was presented to the National Assembly. In the last few weeks that the issue has generated reactions and heated debate, the blame has been heaped on the lawmakers.

It would appear that no one is asking the question; has the National Assembly the right to alter the budget and make additional input in the interest of the nation and the people they represent?

The constitution empowers them to make some adjustments where necessar y. But because Nigerians have been through military regimes where

budgetary processes are dictated, no one wants to reason and look beyond the ordinary to urge both the executive and the legislature to take the path of honour and dialogue over the issue and sort out the grey areas in the budget. The lawmakers were elected by their people to represent their interest just as the President was elected to represent the interest of all Nigerians.

Besides the raising of the budget figures, the National Assembly members were said to have included projects such as provisions of boreholes, town halls, football pitches as constituency projects to be funded by the Federal Government. This, angered the Presidency as these are projects in their opinions that states and local governments should be funding.

Here is the real issue.

Constituency projects are permitted in the budgeting process. The fundamental thing here is that Nigerians know too well that states cannot meet their salary obligations to their civil servants. Upward of eight

Has the National Assembly the right to alter the budget and make additional input in the interest of the nation and the people they represent?

months arrears are outstanding in almost all the local government councils in the country. 24, out of the 36 states are owing theirs workers three to five months salaries.

The Federal Government has decided to be the financial godfather or rather the bread winner of the other two tiers of government in the country by collecting the lion’s share of the federation account.

Since it has decided to be the financial father of all, it should bear the burden of all. The legislators know this and have decided to ask the Federal Government to fund water supply to some sections of the Nigerian community which at the moment have no access to clean and potable water.

The federal legislators are well aware that in some parts of the country, water-borne diseases such as cholera, typhoid, dysentery and river blindness are taking a huge toll on the populace. Arguably, in recent times, Lassa fever has taken a heavy toll on several communities across the country. This arose because of filthy and dirty environment which many Nigerian rural dwellers live in.

Providing clean water could be a way to solve some of these health problems. It is, therefore, not an offence to ask the Federal Government to make provisions for water for the citizens in a political milieu where there is understanding among political actors who takes the welfare of the populace above party politics and selfish interest.

I cannot make excuses for town hall request as Nigerians are well aware of the shenanigans at the National

Assembly. For football pitches, the only thing unifying Nigerians as a people, is the game of football. If this government of change can invest in Nigerian football, it could bring about a positive change of attitude towards one another as Nigerians do not care who plays so long as the their team is winning. It certainly would be a right investment in the youth which APC has said it will develop.

Nigerians must wean themselves from emotional outburst and look beyond the current face off between the executive and the legislature and blame game tactics. Good enough, the Deputy Speaker of the House of Representatives, Yussuf Lasun, has been saddled with the responsibility to lead the 10-man National Assembly Committee to interface with another five-man committee from the executive to harmonise all the grey areas pointed out by the Presidency in the 2016 budget. The 15man committee which has five members of the House of Representatives and five members from the Senate as well as the five members from the executive is expected to finish its assignment on or before today for the presidential assent expected to take place between tomorrow and Wednesday.

This is the sensible thing to do; all parties to the reconciliation of the budget figures should approach the issue with an open mind. It must not be a blame game session but a session of give and take and concessions. It must be a thorough negotiation process that will resolve all the grey areas and make the budget implementable. That is what Nigerians voted for, not which arm of government is superior to the other.

Economy CITN chief seeks introduction of Cattle Rearing Tax to check herdsmen excesses

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he President of the Chartered Institute of Taxation of Nigeria (CITN), Mrs Olateju Somorin, has advised the Federal Government to introduce a Cattle Rearing Tax to check the excesses of herdsmen in parts of the country.

Somorin gave the advice in an interview with the News Agency of Nigeria (NAN) on the sidelines of the induction ceremony of new members of the institute on Friday in Lagos.

According to Somorin, Cattle Rearing Tax if imposed on nomads will reduce the penchant of herdsmen to invade Nigerian communities at will.

“If Cattle Rearing Tax is imposed, nomads will prefer to stay in a place for grazing.” She said the Federal Government could achieve this by directing states to impose the tax. The CITN chief noted that bloodletting arising from incessant killing of farmers by herdsmen could degenerate

and give rise to security challenges like the Boko Haram insurgency.

Herdsmen have descended on many communities in parts of the country in recent times,

killing, raping and looting communities in a bid to secure grazing rights for their animals.

FG begins preparation of 2017 budget

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he Ministry of Budget and National Planning says it has started preparation of the 2017 budget to enhance economic development. This is contained in a statement by Mr Charles Dafe, Director of Information in the ministry in

Abuja. The statement said that the Minister of State Budget and National Planning, Hajia Zainab Ahmed, disclosed this when the Association of National Accountants of Nigeria (ANAN) paid her a courtesy visit.

She added that the Federal Government had also started the

preparation of the Medium Term 2016-2020 Development Programme to achieve sustainable development.

The ministry, however, solicited the support of ANAN to build the capacity of the staff on Zero Based Budgeting (ZBB) application.

20 — Vanguard, MONDAY, MAY 2, 2016

Business & Economy

LIRS engages 1200 tax audit professionals

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n its drive to ensure full maximization of its revenue generating potentials, and to commence tax Audit exercise of 2016 in earnest, the Lagos State Internal Revenue Service ((LIRS) has engaged 1200 members of the Chartered Institute of Taxation of Nigeria (CITN) and the Institute of Chartered Accountants of Nigeria (ICAN) as Tax Audit Monitoring Agents (TAMAs).

The TAMAs are authorized to act as agents of LIRS for tax audit and assurance purposes. The LIRS carried out a review of the appointment and operational procedure of the TAMAs in order to enhance efficiency in its audit exercise.

Their duty would be to collect requisite information during tax audit field exercises, collate, prepare and submit tax audit reports based on the facts gathered for use by the LIRS. A workshop was organized for the agents at The Haven Event Centre, GRA, Ikeja, Lagos on Tuesday, April 26, 2016.

Present at the workshop were the Lagos State Commissioner for Finance, Mr. Mustapha Akinkunmi; Chairman, Lagos State House of Assembly Committee on Finance, Honourable Oluyinka Ogundimu; Executive Chairman of LIRS, Mr. Olufolarin Ogunsanwo, and other management staff of the agency.

In his opening remark, Mr. Ogunsanwo implored the TAMAs to demonstrate the highest level of professionalism. “We believe you will demonstrate a high sense of responsibility and integrity in this noble assignment in line with international best practices as we hope to improve the internally generated revenue of the state and ultimately engender a sustained culture of voluntary compliance amongst tax payers in Lagos.

“I have no doubt in my mind that your professionalism will be of tremendous value during this year’s exercise and beyond,” Ogunsanwo said.

AFDB, Cellulant target food security with technological innovation

BY MICHAEL EBOH

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he African Development Bank, AfDB, has entered into a strategic partnership with Cellulant Corporation, to boost agriculture in Nigeria and across the African continent, using innovative technological solutionsb that would help provide access to financial services to a large number of farmers.

Cellulant, in a statement in Abuja, stated that the collaboration seeks to make available to African Governments technology solutions such as the eWallet system that drive inclusive

growth in Africa by expanding to smallholder farmers access to financial services, agricultural inputs, eextension, & markets in the agricultural sector via their mobile phones.

The partnership, according to the statement, would see AfDB and Cellulant Corporation working with African governments and African technology firms to develop and deploy various agricultural services via mobile phones, adding that with the eWallet framework, governments will be able build the agriculture software development capacity across the continent.

Specifically, Cellulant Corporation had already

recorded many notable achievements in Nigeria, where it has been a driver of the highly successful eWallet scheme that transformed millions of farmers lives.

In a span of three years, Cellulant Corporation worked with the Nigerian government to register more than 14 million farmers into the eWallet system. Additionally, $600 million, about N120 billion, was created in lending and microfinance opportunities, over $30 billion was contributed to the Nigerian GDP, and farmers income was doubled from $700 to $1,800.

To this end, Cellulant said it has extended its e-wallet solution to Liberian farmers to

BRIEFING: From left, Chef Raphael Duntoye; Chef Tiyan Alile and Mr Bolaji Lawal, Divisional Head e-Business, GTBank during the GTBank Food &Drink Fair press briefing held in Lagos.

ANAN to assist FG on Zero Based Budgeting

BY EMMANUEL ELEBEKE

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he Association of National Accountants of Nigeria (ANAN) is to assist staff of Ministry of Budget and National Planning with technical knowledge on Zero Based Budgeting (ZBB) Concept adopted in the 2016 budget.

This was revealed on Thursday when members of the Association, led by its President and Chairman of Council, Mr. Anthony Chukuemeka Nzom, FCNA, paid a courtesy visit to the Minister of State, Budget and National Planning, Hajia Zainab Ahmed, a fellow of the Association in her office in Abuja.

Commenting on the visit, the Minister of State Budget and National Planning, Hajia Zainab Ahmed, expressed appreciation to the Association for it’s concern to help the ministry succeed. Her words: “the federal government has started preparation on the 2017 budget process and also the medium term 2016-2020 development programme, our ministry needs ANAN’s technical training on ZBB

application. I am aware that budgeting is a core component course our Association experts teach at its well ranked Accounting school” The Minister also appealed to the members of her Association to assist the present administration to fight corruption when she said “the terrible corruption of our past administration has denied Nigerians benefits of our commonly owed resources. As Accountant, we can resist corruption, block illegal releases, we need to start from ourselves, and we must uphold tenets of our profession and make ourselves clean and accountable always” Hajia Zainab added that “our administration came on a change mantra; we shall be transparent and accountable to all Nigerians” Earlier in his remarks, the President of the Association, Mr Anthony Nzom, lauded the appointment of two of their ANAN fellow members Hajia Zainab Ahmed as Minister and Alhaji Tijjani Muhammed Abdullahi as Director General Budget Office by President Muhammadu Buhari and added that the nation will benefit a lot from their professional competences and services.

help transform the country’s agricultural sector, adding that within the next six months, it would be developing an innovative farmer eregistration platform which provides a holistic system to link farmers and agro-dealers to agricultural inputs supply chain, finance and market places.

The same technology, the company said, will transform Liberia’s agricultural sector into a viable agri-business.

Commenting on the development, Cellulant Nigeria’s Chief Executive Officer and co-founder of Cellulant Group, Bolaji Akinboro, said, “We are excited to be partnering with the Government of Liberia and the African Development Bank.

This collaboration will provide a solution to millions of Africans who depend on the agriculture sector for their livelihoods.

“We believe that the digital revolution in Africa supports an outside the box thinking that can build infrastructure on payments and easy access to services that can be scaled with speed. Additionally, programs such as the Agricultural Transformation Agenda are clear examples that social return on investment can play a role in the growth in the continent where current and future generations can be part of the transformation of millions of lives.”

The company further stated that through an international procurement exercise, Cellulant won the contract beating 17 global companies that participated in the bidding in 2015, adding that the technology provided by the company is essentially expanding access to financial services, agricultural inputs, eextension and markets in the agricultural sector to smallholder farmers via their mobile phones.

“This is accomplished by integrating into mobile networks, financial services providers, market and trading networks and mobile payment systems. Eventually there will be integration into third party databases for cross-referencing and monitoring purposes.

“By tracking farmers’ activities, the platform will help address livelihood and business risks, linking them to service providers along the value chain, in order to achieve higher economic returns to land, labour, capital and ecosystem service investments,” the company said.

Cellulant is a digital payments ecosystem in Africa connecting merchants, banks and mobile operators with their customers.

Vanguard, MONDAY, MAY 2, 2016 — 21

Business & Economy

Micro-Business

Young Entrepreneur F

LAUNCHING: From Left: Oyo State Governor, Senator Abiola Ajimobi with Mrs. Mary Akpobome, Heritage Bank’s Executive Director, Lagos, South West and Corporate Banking; at the launching of Oyo State Agricultural Initiative, OYSAI, supported by the bank, at Paago Village, Iseyin Local Government Area of the State on Tuesday. In the background is Shuaibu Bello, CEO, InterProducts Link Limited, an agro-allied investor invited to the occasion.

Ineffective laws fuel impunity by businesses, multinationals — CPC boss

By FAVOUR NNABUGWU

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he Director-General of the Consumer Protection Council, Mrs. Dupe Atoki yesterday blamed the ineffective use of the Council’s enabling legislation on the flagrant display of impunity by businesses and multinationals in the country.

Atoki while addressing members of the Nigerian Bar Association (NBA) at the mentorship and business development programme in Abuja said the council was able to reduce the level of consumer abuse and in curbing the excesses of business owners and multinationals with the prosecutory powers of the Council’s Act. She noted that the adoption of sector by sector intervention by her leadership in addressing consumer abuses has had widespread positive effects in the sectors, stating that the Council’s investigation was ongoing in the banking, hospitality, electricity and aviation sectors noted that food and beverage as well as satellite television sectors had been successfully undertaken.

She further hinted that “interventions in other problematic sectors will also be undertaken as we progress in order to alleviate the suffering of consumers”, stating that the strategy became inevitable in view of the widespread consumer abuses in the country.

According to her, “In view of the myriads of consumer complaints in various sectors, it became apparent that the resolution of individual C M Y K

complaints alone will not make the desired impact”, pointing out that “sectoral intervention was identified as a major strategy for arresting systemic irregularities and modifying the behaviour of firms for faster and widespread resolution of consumer complaints.”

Atoki went on to say that, “Interventions in the food and beverage and satellite television sectors have drastically reduced the quantum of complaints in those sectors and conferred some benefits on consumers.”

The CPCboss asserted that some of the challenges facing the agency, prior to her

assumption of office, such as low level of consumer awareness; consumer apathy; impunity of businesses; brick walling by sector regulators; and protection of self interest by trade association, were already being addressed by the Council’s strategic plan. “The committed execution of the strategic initiatives carried out by the Council under the current administration has awakened, to a great extent, the consciousness of Nigerian consumers, who are now more assertive and are thereby beating businesses to a retreat from their erstwhile practice of shortchanging consumers.

Piracy: NIMASA seeks inter agency pooling of resources

By GODWIN ORITSE

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OLLOWING an upsurge in pirate attacks on vessels of the coasts of Nigeria, Director General of Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Dakuku Peterside, has called for the deployment of inter Agency resources including the use of advanced technology to secure Nigeria’s maritime domain.

Speaking during a visit of the agency’s management to the Headquarters of the Nigerian Air Force, Peterside said that collaborative efforts ny relevant agencies will stem the increase of rising cases of piracy in the Nigerian waters.

The NIMASA boss requested the immediate review of

the Memorandum of Understanding (MoU), NIMASA has with the Nigerian Air Force with a view to strengthening the Agency’s capacity to deal with maritime crimes as well as reduce the response time for Search and Rescue (SAR) operations.

He commended the Nigerian Air Force and indeed the military for the successful prosecution of the war against insurgency in the North East saying that “now Nigeria can begin to discuss developmental issues for the good of all its citizens”.

Peterside emphasised that maritime security needs a multi-sectoral and inter-Agency collaboration, calling on relevant stakeholders to pool national resources together to defeat piracy.

isayo Solomon Oguntayo (21), popularly known as Fisayo OG is the C.E.O of his own company DeMoriah which is a fashion company. He was born on the 13th of March 1995 in Lagos, Nigeria and is the second child of four kids. Growing up, Fisayo developed his own unique sense of fashion and always wanted to stand out wherever he may be fashion wise.

Fisayo decided to start his own fashion line after noticing the amount of people complimenting his style as well as asking where he got his outfits from. With this initiative he started his own brand which was originally called Gidi Couture but then changed to DeMoriah Couture in the year 2014.

When he told his parents about his plans to start his own business at the young age of 17 like any normal parent, they tried to discourage him.

They advised him to focus on his education first as he was studying Pharmacology, a course which needed as much concentration as possible.

But due to his drive and passion he went ahead and started with custom made shirts before expanding to other types of clothing and footwear.

Fisayo has always been a selfless person and has always cared about those who are less fortunate, they inspired him to use his line of business and the popularity he had gained over two years to help those who are less privileged, which was how the DeMoriah Valentine came about.

DeMoriah couture is a fast rising fashion house and observes its annual philanthropic project tagged “DeVal”. “DeVal” is also known as DeMoriah Valentine, it is an annual charitable event which brings students from various institutions to observe the St. Valentine’s Day in Lagos Nigeria. They visit two orphanages every February 14 to show the kids love and also donate gifts as well as educational materials. Since the inception of this initiative in 2014 tagged “DeVal 14”, subsequent DeVal programs such as DeVal 15 and DeVal16 have taken place with each year being bigger than the last.

Being one to always

find new ways to help and educate young minds, Fisayo S o l o m o n Oguntayo is also an ambassador for a peace movement c a l l e d Galaxy4peace.

Galaxy4peace is a youth led nongovernmental organization with the major objective to promote a peaceful culture. They go about achieving this by creating an awareness of the need for a peaceful society, talking people through capacity building & sensitisation programs, particularly with youths who are more likely to get into trouble in our communities.

The peace movement Galaxy4peace was founded by Miss Precious Ajunwa. They host different events during the course of the year, such as the Sweat4peace which is a peace walk, Teach Peace Early and Peace at Workplaces.

Sweat4peace is an annual peace walk which brings over 400 young people and Nigerian celebrities as well as politicians to observe the international day of peace in Lagos, Nigeria. Since its inception in 2014, this project has brought together about 900 young people to observe Peace Day. These people are well educated on the importance of peacemaking as well as ways to shun violence and embrace peace.

Teach Peace Early is a peace education campaign in schools. So far, they have been able to reach out to over 2000 students through this peace education program. The activities get participants engaged with exciting lectures that centre on tolerance, love, unity, empathy,

Find what you’re passionate about and just go for it

peace a n d respect.

Peace at Work places is another event that takes place multiple t i m e s during the year which is aimed at equipping c o workers with necessary conflict management skills to avoid and be able to manage conflicts when it arises at work places.

Fisayo who just recently graduated from Medical College of Lagos, has been featured on various blogs due to the work he does for Galaxy4peace as well as his own annual event.

Everyone who comes in contact with him is always impacted with his good vibes as well as his drive for his work.

According to his friend Gloria, “I am privileged to have met such an inspiring young man. He is someone that not only has the ability to dream but also to bring those dreams to reality and the beautiful thing about this young man is that he not only believes in his own dreams but also believes in, encourages and supports my own dreams too, I’m baffled.”

When I asked Fisayo what message he wanted to relate to the readers, he simply said “I want the readers, especially young ones, to know that it is never too early to start making your mark in the world. Find what you’re passionate about and just go for it.

22 — Vanguard, MONDAY, MAY 2, 2016

Banking & Finance

Ecobank Rapid Transfer adds value to Okpekpe race

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cobank Rapid Transfer product would adequately cater for over 3000 local and international professional athletes including sports enthusiasts and government officials across the continent expected at the Okpekpe International Road Race.

The Chief Executive Officer, Pamodzi Sports Marketing, Mike Itemuagbor and promoter of Okpekpe International Road Race stated this while commending the product for adding value to the Okpekpe 10km Road Race scheduled for May 7th in Okpekpe town, in Edo State.

According to him, “The Okpekpe Road Race is global competition. It is therefore natural we look for a bank with a product that has international appeal. This informed our choice of Ecobank Rapid Transfer. The product has contributed immensely to the success of the past competitions.”

Speaking on the partnership recently, Ecobank’s Managing Director, Charles Kie said the Ecobank Rapid Transfer is best suited for the competition that has grown to have global recognition. This year ’s partnership is the 3rd on the row the bank is getting the official money transfer status of the renowned Okpekpe Road Race.

According to Mr. Kie, the Ecobank Rapid Transfer is an innovative money transfer services available within Nigeria and countries in Africa where Ecobank is present. “The service was conceived out of the need to provide quick, convenient, accessible, and reliable money transfer facility for our retail and wholesale customers and non-customers of the bank”.

Kie is optimistic that the Ecobank Rapid Transfer will provide the much-needed ease of financial transactions during and after the competition, and urged all the participants to avail themselves of the opportunities provided by the bank.

In his words: “This is an Ecobank proprietary send and receive money transfer product available in all Ecobank branches in Nigeria. The product allows you to send and receive money across Nigeria and to also receive money from over 30 countries other Ecobank has its footprint. It is our way of supporting this international race to ease the burden of fund transfer.”

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Bank of Agriculture’s performance deteriorates in 2015 *Loss rose by 3,742% to N7bn * Mint records N345m loss Stories by BABAJIDE KOMOLAFE

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he declining financial performance of the Bank of Agriculture deteriorated in 2015 as its losses shot up by 3,742 percent to N7.1 billion.

Meanwhile financial performance of Nigeria Security Printing and Minting Company (NSPM) or The Mint, improved during the year as its losses dropped by 94 percent to N345 million in 2015.

This was disclosed by the

Central Bank of Nigeria (CBN) in its Consolidated and Separate Financial Statements for the year ended 2015 released last week.

The CBN statement revealed that all the associate companies made profit in 2015 except BoA and the Mint

The Bank of Agriculture (BoA) is one of the seven associates companies of the CBN. Others are Nigeria Interbank Settlement System (NIBSS), African Finance Corporate (AFC), National Economic Reconstruction Fund (NERFUND), Nigerian Export Import Bank (NEXIM), Bank of Industry, Financial market Dealers Quote OTC (Plc).

The CBN statement revealed that all the associate companies made profit in 2015 except BoA and the Mint recorded losses.

Analysis of the financial performance of BoA revealed

FORUM — From left: Ahmed Kuru, MD, AMCON; Professor Pat Utomi, Founder, The CVL and Oluwatoyin Sanni, Group CEO, United Capital Plc at The Centre for Values in Leadership Role Model Forum in Lagos.

Cost of funds falls as N336bn inflow boosts interbank liquidity External reserves drop by $740m in April

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ost of funds in the interbank money market fell by 40 percent last week following inflow of N336 billion into the market.

Meanwhile the nation’s external reserve fell slightly by $740 million in April to $27.12 billion at Thursday April 28th from $27.86 billion on March 31st.

Vanguard review of money market activities revealed that the interbank market received inflow of N143 billion from Federal Allocation Accounts Committee (FAAC); N52 billion from Cash Call payment to International Oil Companies (IOCs) by the federal government, N45 billion from payment of coupon payment on FGN Bonds; and N96.4 billion payment from matured treasury bills.

The market however experienced outflow of N152 billion due to liquidity mop by the Central bank of Nigeria (CBN) through treasury bills.

Hence the market experienced net inflow of N184 billion, which caused market liquidity to rise by 59 percent from N284.78 billion at the beginning of the week to N454 billion.

The surge in market liquidity prompted a 40

percent fall in short term interest rates namely Overnight Lending and Open Buy Back (OBB) lending, which fell from 5.0 percent in the previous week to 3.0 percent at the close of business on Friday Analysts at Afrinvest however predicted that cost of funds will rise this week as the CBN is expected to mop up liquidity from the market through sales of treasury bills.

“Next week, we expect money market rates to trend northwards as we expect the CBN to carry out more OMO mop-ups. There is a net T-bills maturity of N150.6bn expected to hit the system on Thursday, the impact of this on liquidity levels is however expected to be off-set by a rollover of the same net amount”, they said in the Company’s weekly Update of the financial markets.

The Company also predicted that the relative stability of the naira exchange rate last week will persist this month. The Company stated, “This week, Naira traded at the CBN and Interbank at N197/$ and N199.10/$ respectively.

that total loss rose sharply from N185 million in 2014 to N7.108 billion in 2015. Though revenue rose by 50 percent to N1.8 billion from N1.2 billion, the bank went from gross income N3.2 billion in 2014 to gross loss of N2.5 billion in 2015, implying sharp increase in losses to bad loans Furthermore its total expenses jumped by 35 percent or N1.2 billion from N3.4 billion to N4.6 billion.

The Bank was incorporated on 24 November 1972 as Nigerian Agricultural Bank Limited, changed its name to the Nigerian Agricultural and Co-operative Bank Limited (NACB) in 1978 and later changed to Nigerian Agricultural Co-operative and Rural Development Bank Limited (NARCDB) on 29 December 2000. It enlarged it object clause to include the total development activities of the Peoples Bank of Nigeria and also acquired the risk assets of the Family Economic Advancement Program (FEAP). On 6 October 2010, the Bank further changed to Bank of Agriculture Limited.

The Bank is fully owned by the Federal Government of Nigeria through the Ministry of Finance Incorporated and the Central Bank of Nigeria. The Bank grants Micro and Macro loans for Agricultural production, processing and marketing and other financial services, but as from 1 April 2006, marketing ceased to be one of the Bank’s principal activities. It also engages in the business of stimulation of rural savings as well as provision of loans to small scale enterprises in order to develop the economic base of the low income populace.

Mint records N345m loss The financial statement revealed that the Nigeria Security Printing and Minting Company (NSPM) or Mint recorded a loss of N345 million in 2015. This however represents 94 percent decline when compared with the N5.5 billion loss incurred in 2014.

The Company’s revenue rose

by N5.31 billion or 29.6 percent to N23.2 billion from N17.89 billion. Cost of sales rose 33.3 percent to N20.22 billion from N15.19 billion while administrative cost dropped by 37 percent to N2.96 billion from N4.7 billion. Though the company earned N275 million as finance income, up by 17 from N235 million in 2014, its finance cost, interest paid on loans, jumped by 269 percent to N1.22 billion from N33 million in 2014.

Vanguard, MONDAY, MAY 2, 2016 — 23

Corporate Finance

By NKIRUKA NNOROM

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here was a positive trend reversal on the Nigerian Stock Exchange, NSE, last week, which resulted gain N73 billion to investors owing to significant activity on shares of some blue chips, including Nigerian Breweries, Total Nigeria Plc, Dangote Cement Plc and 7up Bottling Company Plc. As a result, the primary market indicators – the market capitalisation and the All Share Index – rose by 0.9 per cent apiece. Specifically, the market capitalisation rose by N73 billion from N8.548 trillion at the opening session on Monday to N8.621 trillion, while the All Share Index (ASI) rose to 25,062.41 points from 24,850.11 points.

44 gainers emerged in the week a against 36 losers.

Consumer goods company, Nigerian Breweries led the gainers chart, rising by N10.19 to close at N115.89 from the previous N105.70 per share. Total Nigeria Plc followed on the gainers’ chart with N7.19 to close at N154.19 from N147.00; 7up Bottling Company advanced by N2.41 from N142.59 to close at

We are investing despite challenges — PZ CEO

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NEW EXCO: From left, Chartered Institute of Stockbroker’s Second Vice President, Mr Olatunde Amolegbe, Past President, Mr.Olushekun Ariyo, President, Mr. Oluwaseyi Abe, after announcement of the institute’s new President in Lagos.

Blue chips gains propel NSE capitalisation by N73bn N145.00, while Dangote Cement Plc appreciated by N2.36 to close at N163.40 from N161.04.

On the other hand, shares of

petroleum marketing major, Forte Oil Plc, led the losers, dropping by N60.77 to close at N214.35 from N275.12, followed by Mobil Oil Plc with

FCMB shareholders okay N1.98 bn dividend

By PETER EGWUATU

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hareholders of FCMB Group Plc, the holding company of First City Monument Bank (FCMB) Limited last weekend, unanimously approved the proposed dividend payment of N1.98 billion for the financial year ended December 2015.

The shareholders commended the Board and management for the performance during the year under review despite the harsh operating environment.

Speaking at the third Annual General Meeting, AGM of the company, the Co-ordinator of Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, who spoke the minds of members present at the meeting said “We appreciate FCMB Group, its subsidiaries, their respective Boards, Management, the Founder and indeed all staff for their resilience and ability to face the present socio-economic and regulatory challenges. The fact that the institution paid a dividend of 10 kobo shows that it has all it takes to overcome the situation. Things may be tough now, but it will not last forever. Given the advice, we have given the Board and Management, we are optimistic that FCMB will

perform better going forward.”

Another independent shareholder, Alhaji Kabiru Tambari, expressed appreciation to FCMB for the dividend payment and other strategies put in place to enhance performance. According to him, “we believe that the institution will continue to improve and add more value to shareholders”.

Addressing shareholders at the meeting, the Chairman of FCMB Group, Dr. Jonathan Long, said, ‘’although 2015 posed many challenges for the Group, it was again possible for us to continue the development of our core banking franchise and to do so profitably”. With the depth and range of professional excellence among our staff, and benefitting from our strong Board and Committee structure, the Group will deal successfully with the challenges of 2016 and continue to lay a path for future growth and prosperity in a sustainable manner”.

The Managing Director of FCMB Group Plc, Mr. Peter Obaseki, noted that the Group is focused on sustaining the momentum of its leading retail presence He added that, “the outlook for 2016 in terms of portfolio strategy is positive”. As we seek to build more businesses in the retail space, we hope to fully launch a microfinance business as a full subsidiary of the Group and seek opportunities to improve

controlling participation in the pension fund industry; we expect our non-pension asset management and private trusteeship business to grow more steadily. A combination of these initiatives will reduce the pressure on the bank’s balance sheet and steer activities to less capital intensive businesses”.

Also speaking, the Group Managing Director/Chief Executive of First City Monument Bank Limited, the flagship firm of the Group establishment, Mr. Ladi Balogun pointed out that the Bank has moved swiftly and decisively to address the challenges that affected its financial results last year.

N7.20 to close at N147.80 from N153.00. Guinness Nigeria Plc and Lafarge Africa Plc lost N6.72 and N6.01 to close at N91.28 and N67.99 respectively.

Meanwhile, analysts at United Capital Plc had predicted that the gains recorded in penultimate week would be sustained barring unexpected shocks on the macro side. They said: “We expect demand for equities to be sustained this week, as more quarter one (Q1-16) numbers roll in. We envisage momentum will however be short lived as investors remain cautious mostly betting for a short horizon.

In their review of activity in the previous week, they attributed the rebound on the NSE to higher demand, tied to position taking by investors with the Q1-16 earnings numbers firmly in view.

Lafarge Africa records N2.2bn loss in Q1

By NKIRUKA NNOROM

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afarge Africa Plc has recorded poor performance across all major indicators for its first quarter ending march 31, 2016, posting loss before tax of N2.22 billion as against profit before tax N6.09 billion achieved in the corresponding period in 2015, representing 63.6 per cent decline. Similarly, the company recorded N1.87 billion loss after tax compared to profit after tax of N5.83 billion reported in the same period in 2015.

Highlights of the report released on the Nigerian Stock

Exchange, NSE, showed that operating income reduced to N180 million as against N8.12 billion recorded in the corresponding period in 2015, representing 15 per cent decline.

However, the company’s revenue fell by 29.3 per cent to N52.42 billion in comparison to N74.12 billion in Q1 2015.

The company said in an accompanying note to the result that the reduced profit was a result of the decreased cement prices and slightly lower volumes, following the temporary logistics and production challenges.

he Chief Executive Officer, PZ Cussons Nigeria Plc, Mr. Christos Giannopoulos has assured the investing public that the company is still investing in Nigeria despite the economic challenges.

He disclosed this when the management of PZ Cussons paid a courtesy visit on the Nigerian Stock Exchange, NSE and sound the closing Gong of the market.

According to him “Our company has come to stay in Nigeria. We are investing despite the economic challenges and there are potentials and opportunities that the company can tap, though we are importing most of our materials but we are encouraging our suppliers to look inwards toward producing some of our materials locally.”

He stated that the country will overcome some of the challenges it is currently facing and businesses would begin to strive. “We are investing for the future and our stakeholders would be adequately rewarded for their resilience and support” he noted.

“Nigeria is PZ Cussons’ largest single market, and therefore important in understanding the business.

Stanbic IBTC stockbrokers launches e-trading platform on NSE

By NKIRUKA NNOROM

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tanbic IBTC Stockbrokers Limited has launched an online stockbroking service on the Nigerian Stock Exchange, NSE, with real-time processing capacity. The Stanbic IBTC ETrade provides investors with real-time market information as well as enabling them give realtime mandates to buy or sell shares on the Exchange.

Among its uptakes, the platform is expected to help the market regain investors’ confidence by availing them the insight required to act prudently on new investment opportunities in the marketplace via a secure and robust technologically-driven platform.

Chief Executive, Stanbic IBTC Holdings Plc, Sola David-Borha, said the Group is committed to helping deepen the Nigerian capital market by making available to the investing public information, initiatives and strategies that could help them have superior information about developments in both the local and global markets.

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24 — Vanguard, MONDAY, MAY 2, 2016

Insurance

Nigerian Turkish Nile University set to bridge entrepreneurship gap

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IGERIAN Turkish Nile University has announced its readiness to hold an entrepreneurship trade fair in Abuja, to bridge the entrepreneurship gap in Nigeria.

Dr. Gylych Jelilov, the Head of Department of Economics in the University stated that it is important to create an effective working relationship between the business community (the town) and the academia (the gown), with the growing knowledge-based economy and the need for innovation.

Gelilov said it is imperative for a country like Nigeria at a time like this to start thinking towards building bridges to link up theories and knowledge that spring out daily from the academic world to enhance and consolidate innovation in the Nigeria economy.

“It is against this backdrop that we have taken bold steps toward building solid bridges (developing sustainable economic policies) to close up the gap between the “Gown” and the “Town”.

Commissioner urges West African insurance practitioners to build strong market Stories by ROSEMARY ONUOHA

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OMMISSIONER for Insurance, Mr. Mohammed Kari has urged insurance practitioners in West Africa to join hands to build a stronger regional market that is capable of competing with its peers in other regions.

Kari who stated this during his welcome statement at the just concluded West African Insurance Companies Association (WAICA) educational conference 2016 in Lagos, noted that insurance provides financial and social stability, enhances trade and commerce, offer opportunities for savings which in turn

enhances the well-being of the citizenry and the nation in general.

Kari noted that though the future of the insurance sector is hard to predict, however it can be prepared for.

He said, “Insurers are faced with the challenges of new businesses, changing laws and regulation among others.

Changes in regulation in my opinion are a by-product of the past financial crisis and the globalisation of the world’s economy which have enmeshed nations of the world together irrespective of geographical boundaries.

“Notwithstanding these challenges, I see enough potential for positive growth of

the insurance sectors in the West African states, given the collaborative efforts of the players, regulators and governments in the region. The potential I see are not limited to some prospective demand for insurance products but for the operator’s collective efforts to address common issues that were hitherto seen as individual’s problems.

“Meetings like this should create opportunities for operators and regulators alike, to compare and exchange notes on how each market is tackling their individual challenges, and how best to avoid others’ adverse experiences. I’ve witnessed first-hand how coming together can easily

overcome previously presumed insurmountable hurdles. The global insurance markets are one and the same. It may only differ in magnitude but not in substance.

So while deliberating we should remain conscious of other regions resolutions and ideas, thus acknowledging the age-long adage of not having to reinvent the wheel.

“Our overall desire is to have an industry that is knowledge driven and run in line with international best practice in our respective countries. Let us come out with resolutions and ideas that can make us the envy of Africa and the world, let us learn from each other and let us work together in order to overcome challenges confronting us, economic or otherwise,” Kari stated.

Nominations for Businesstoday awards opens

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usinesstoday Online, a Nigerian business news website has said that nominations for its insurance and pension awards 2015, now in third edition have opened. A statement issued by the Managing Director /CEO, Nkechi Naeche said the global awards seek out exceptional insurance and pension industry operators and firms who have exceeded in their field in the last twelve months.

The statement added that the awards provides opportunity for firms, clients and associates to vote for who they feel is the most deserving in the 2015 Businesstoday awards.

The statement further urge operators interested in nominating anyone to do so through the Businesstoday online email info@businesstodayng.com and deadline for entries is Tuesday 27th, May 2016.

The categories are: Businesstoday insurance man of the year award; Businesstoday insurance company of the year award; Businesstoday micro insurance company of the year award; Businesstoday CSR insurance company of the year award; Businesstoday most valuable insurance brand 2015; Businesstoday pension company of the year award; Businesstoday pension man of the year award; Businesstoday online most pensions compliant state award and Businesstoday insurance broking company of the year award.

WORKSHOP: From left, Dr.Olufemi Oyediran, first Vice President, Institute of Public Analysts of Nigeria (IPAN);Dr. E.Osagie Ehanire, Hon. Minister of State for Health; Mr. Duro Abdusalam, acting Registrar; second Vice President, Prof. Olugbenga Ogunmoyela during the Institute’s 23rd Training Workshop held in Lagos last Thursday.

Pension's all about making plans for old age — Ideva M

ANAGING Director and Chief Executive Officer of Premium Pension Limited Mr. Wilson Ideva has said that Pension is all about one making plans on how to take care of oneself at old age.

Ideva made the assertion when the company gave out four categories of prizes to winners in the first phase of its social media campaign which ran from February 15 to March 19, 2016. The campaign tagged #Reward4DHustle was on the social platforms of Twitter, LinkedIn, Instagram and Facebook and was anchored

by Alder Consulting Limited.

The campaign provided an

opportunity for the company to address public enquiries and requests through the instrumentality of modern information technology and also contribute to the generation of public awareness as to the workings of the Contributory Pension Scheme.

Kofoworola George-Taylor, an event manager based in Lagos won on Instagram and received a prize of a fully-paid project management course and international travel while Olanike Oyediran, a Lagosbased lawyer won on Facebook and got the opportunity to undergo a fully-paid project

management certification course. Another prize was for Idris Abubakar Sadiq, a computer engineer/teacher based in Kaduna who won a home office (laptop, printer and modem) while Ogbonna Kingsley Leo, an Enugubased nurse won on Instagram and received a laptop.

Ideva said, “We believe in catching them young that’s why we opted for the social media which is very popular with the youths.”

He reiterated the need for massive public awareness with regard to the Contributory Pension Scheme while conferring on the

winners the status of brand ambassadors of the company.

“You are now our brand ambassadors and you must project the image of the company positively and continue to propagate among your peers the immense advantages of the new pension scheme,” he added Responding on behalf of the prize winners, Idris Abubakar Sadiq expressed appreciation to the company for the high level of creativity adopted in the campaign and the company ’s achievements underscored by consistent high Return on Investment and being the first Pension Fund Administrator in Nigeria to receive ISO Certification among others. “We accept the position of your brand ambassadors and would live up to expectation,” he said.

Vanguard, MONDAY, MAY 2, 2016 — 25

Homes & Housing Finance

Police begins work on Abuja housing estate

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•A private estate development

FG commits N44bn to social housing Stories by YINKA KOLAWOLE

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he federal government has committed N44 billion to the development of social housing in the 2016 budget, in fulfilment of its proposed plan to build one million housing units across the country yearly.

Prof. Mohammed Al-Amin, Managing Director of Federal Housing Authority (FHA), disclosed this when he visited the Turkish Embassy in Abuja, as a follow-up to the recent visit

by Turkish President Tayyip Erdogan to President Muhammadu Buhari. He recalled that that housing featured prominently in the discussion between the two Presidents on areas of possible economic cooperation between the two nations during the visit.

The FHA boss noted that the Federal Government’s plan envisaged that the Federal and State governments would build 250, 000 housing units each while the balance of 500, 000 would be taken up by domestic and foreign investors. According

to him, the Federal Government had matched its words with action by initiating a budget of N44 billion to take care of its own commitment, which would consist solely of social housing units.

Al-Amin said the FHA plans to partner with Turkish companies to facilitate the realisation of the government’s housing development target.

Lagos housing deficit estimated at 2.55m units

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survey commissioned by the Lagos State government has revealed that the total housing deficit in the state is currently estimated to be 2.55 million units.

Commissioner for Housing, Prince Gbolahan Lawal, who disclosed this, said it was the final report of the Housing Needs Assessment Survey prepared by TNS RMS Nigeria Limited for the Lagos State Ministry of Housing.

He said an annual development of 187,500 new houses over the next five years

UK mortgage approvals drop to 4-month low

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he number of mortgage approvals for house purchases in the UK fell to 71,400 in March, a sharp drop from the 73,900 approvals seen in February and well below the 74,200 forecast by economists.

This is the second consecutive month of declines, the Bank of England data show, and follows four straight months of increases, which lifted mortgage approvals to a two-year high in January.

There are several possible factors driving the drop.

Economists have highlighted that some buy-to-let purchases

He noted that Turkish housing products were of high quality and enjoined the Commercial Counselor, Dr Ahmed Zafer Gulsen who received him, to encourage companies from his home country to come and partner with the FHA through: mass production of building materials, contribution of construction finance and technical expertise and

housing construction. The FHA boss praised Turkey’s rich history and noted that the country occupied a strategic geographical position at the intersection of Asia and Europe, and commended the friendly relations between Nigeria and Turkey.

In his response, Gulsen said he would do his best to facilitate the coming of Turkish companies to take up the opportunities offered by the FHA. He promised to forward the request to his home Ministry of Economy, which he said would seek out the appropriate Turkish companies to partner with the authority.

were brought forward to escape the rise in stamp duty on buy-to-let acquisitions that came into force in April, fuelling a rise in approvals at the start of the year, which was followed by the current decline.

In addition, there are growing concerns about the impact of uncertainty surrounding the Brexit referendum in June. Some economists have warned Brexit would dent the UK property market, and as such prospective purchasers as well as construction groups have been putting plans on hold.

is required to effectively tackle housing deficit in the state. “At least, 187,500 new homes are required over the next five years to reduce the deficit,” he said.

Lawal noted that major problems confronting mass housing delivery include high population density, high cost of building materials, nondeployment of new technology and, proliferation of slums.

Others are lack of access to finance, shortage of skilled labour and artisans and problems caused by unscrupulous estate agents, landlords, developers and omo oniles. “In order to reduce the huge deficit, the current policy is to continue to undertake construction of mass housing directly and through the Public Private Partnership programme,” he added.

At least, 187,500 new homes are required over the next five years to reduce the deficit

The commissioner further disclosed that, in its bid to tackle the housing deficit, the state government is set to embark on construction of 50 housing units in each of the 20 Local Government Areas and 37 Local Council Development Areas (LCDAs) of the state.

He added that government plans to partner with the private sector to deliver affordable housing units, and also facilitate mortgage finance with a view to addressing the challenges in the housing value-chain.

Lawal also spoke about the government’s proposed ‘Master Craftsmen Project’ aimed at redressing the dearth of skilled workers in the building industry, such as masons, carpenters, steel fabricators, plumber, electricians and the rest. He also reiterated government’s plan to introduce a rent-to-own scheme designed to make housing more accessible and affordable particularly to low and medium income earners in both the formal and informal sectors. He said under the arrangement, individuals would be required to pay just 5 per cent of the value of a housing unit as commitment fee while payment is spread over 10 years at 6 per cent interest rate.

onstruction work has commenced on the 1004 units housing project for officers and men of the Nigerian Police at Gousa Town, Abuja.

The Inspector General of Police, Mr. Solomon Arase, last week, performed the ground breaking ceremony of the project. This is coming on the heels of the commissioning of 260 Police Staff Homes as part of effort of the Nigeria Police to improve the quality of lives and provide affordable houses for officers and men of the force.

Speaking at the groundbreaking ceremony, the IGP said the event symbolizes the continued efforts of the Police Force leadership to address one of the most fundamental challenges facing officers and men, which is access to decent accommodation for themselves and their supportive families.

His words: “This event represents another historic step towards advancing the welfare oriented policing component of my Strategic Police Plans as Inspector General of Police. The uniqueness of this event, however, rests on the fact that this is the first time that international bodies will be collaborating with the Nigeria Police Force for purpose of addressing the housing needs of the personnel of the Force.”

Arase noted that the project is being undertaken by the Nigeria Police Force Property Development Company in conjunction with Shelter Afrique and UN Habitat.

He added that the partnership will lead to the construction of 25,000 units of low cost houses for members of the Nigeria Police Force nationwide.

“The construction of 1,004 units of this initiative is being launched in the FCT. Prior to this time, similar projects have been completed and handed over to members of the Rank and File cadre in Katsina, Adamawa, Edo and Enugu States. This was made possible through the incorporation of the Nigeria Police Force Property Development Company which engages direct labour using our assets in the Logistics and Supply Department to construct such houses,” he stated.

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26 — Vanguard, MONDAY, MAY 2, 2016

E-Commerce

Shoprite berths in Onitsha, Anambra State

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hoprite demonstrated its commitment to growing in Nigeria with the successful opening of its Onitsha Mall store recently.

Executive Governor of Anambra State, Willie Obiano who was accompanied by his wife and other government dignitaries officiated at the opening of the store, remarked that the occasion was a milestone in his administration’s efforts to make the state the centrepiece for commercial activities.

Speaking on behalf of Shoprite Nigeria, Executive Director, Adeola Kagho, said that she was excited about the warm reception that the store was receiving from the people of the state. “We look forward to opening more stores and playing our part to impact more communities. The free breast cancer screening is just one of the many CSR projects we intend to embark upon in the state and I am happy to witness the high turnout of women taking part in the screening exercise” Through the store opening, Shoprite, in partnership with the management of Onitsha mall, is doing its part by creating over 1,000 job opportunities for locals.

Manufacturers'll redefine physical stores, shape online retail — Report Stories by JONAH NWOKPOKU

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rick and mortar stores will not exist the way it is known today as a result of manufacturers’ and private label retailers increasingly leveraging online retail to showcase products and build brand awareness directly with consumers, with less emphasis on “take home” product transactions.

This is according to a report by an independent analyst and consultancy firm specializing in global coverage of IT, and telecommunications industries, Ovum.

The report which was released last week and titled: ‘The future of E-Commerce: The road to 2026’ indicated that over the coming decade, physical retail will significantly evolve and play less role in global retail structure as a result of the impact of manufacturers preferring online retail.

According to the report, “Physical retail stores will still exist but not the way we know it today. There will tend to be

small format stores. Retail store leases will continue to shorten, and in some cases, more innovative models will evolve to allow manufacturers and private-label online retailers to road-show new products or their brands with event-driven pop-ups.

“While pop-- ups have often been confined in the past to vacated space and therefore less premium locations, in the future, we foresee pop- ups occupying more desirable locations to satisfy manufacturer demands.

Physical retail stores will still exist but not the way we know it today

Manufacturers will want the reach of a large store network but not all year round, and the impact-- driven model means they will want to concentrate resources at a few locations at a time.”

The report noted that the implication of this is that, “manufacturers have already demonstrated their power over retailers, especially in the electrical devices market, and will favour only those retail sites where they have control over how their products are displayed, such as department store concessions.”

The report also indicated that within the coming decade,

Konga commercialises payment solution, KongaPay

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nline marketplace, Konga.com has launched its payment solution, KongaPay to users outside the Konga platform.

This means that the ecommerce giant has joined the league of other payment

Amazon profit crushes estimates as cloudservice revenue soars

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mazon.com last week reported profit and revenue that blew past analysts’ expectations, sending its shares soaring in after-hours trading and demonstrating the growing market power of its core retail business and new cloud services division.

The results draw a sharp contrast to the disappointing fourth quarter Amazon reported in January, which renewed worries among some shareholders about the company’s comparatively thin profit margins. Shares of the world’s biggest online retailer jumped nearly 13 percent to $679 in extended trading on Thursday.

Amazon’s performance also assuaged concerns about a broader slowdown among tech and internet companies after Apple, Microsoft and Intel all reported disappointing earnings.

“It did restore my faith,” said Dan Conde, an analyst at the Enterprise Strategy Group, who keeps a close eye on Amazon’s cloud business.

The company also offered a bright outlook, with revenue guidance for the current quarter of $28 billion to $30.5 billion, compared to the $28.33 billion analysts had expected.

LAUNCH - From left: Shola Adekoya, CEO Konga; Mayowa Adebayo, Director, Marketing & Customer Experience and; Olayemi Jinadu, VP, Payments & Digital Goods, Konga, at the commercial launch of KongaPay in Lagos last week.

Viber apps boost online security with end-to-end encryption

By PROVIDENCE OBUH

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iber, one of the world’s leading messaging apps with more than 711 million unique users worldwide have announced the complete end-to-end encryption across all devices which offers users benefit from increased security and privacy whatever the device or platform.

This new feature will strengthen security in every voice or video call, message, video and photo, in both group messages and one-toone communication across devices like Android, iPhone, iPad, Android tablets, PC and Mac desktops.

“We take our users’ security and privacy very seriously, and it’s critical to us that they feel

there will be an increasingly fragmented physical footprint because the sale of branded products will continue to migrate to the web, as online merchants benefit from pricecomparison shopping, except where superior service and customer experience can justify the higher price points, such as at premium department stores.

“The ‘pile them high, sell them cheap’ model will only remain viable at the very lowest end of the market, where the urgency of attaining products and the lack of a delivery charge supersede a lower online price.

confident and protected when using Viber,” said Michael Shmilov, Chief Operating Officer of Viber.

As part of this update, Viber have also launched ‘Hidden Chats’ allowing users to hide specific chats from the main screen so no-one but the user knows they exist. These chats can only be accessed using a four digit PIN, providing an optional additional layer of privacy to users’ personal communications.

Shmilov disclosed that Viber has spent a long time working on this latest update to ensure that users have the most sophisticated security available and maximum control over their communications stressing that the company will continue to make this an ongoing priority as digital communication evolves.

providers like Systems Specs, eTranzact, Paga etc, providing online payment solutions to all Nigerians.

Recall that KongaPay was first launched in June, 2015 as a strategic step at tackling payment on delivery, which is seen as a disincentive to ecommerce growth in the country. It has since been deployed by the retailer for payment processing within the Konga platform with increased utility by myriads of merchants selling on the Konga marketplace.

The commercial version allows any user to receive payment, pay for goods and services and even send money to third parties. It also comes with a unique feature allowing a user to upload and sell items on the social media platforms including Facebook, Instagram and WhatsApp. Speaking at the launch in Lagos, Chief Executive Officer of Konga.com, Shola Adekoya, said: “Konga is launching KongaPay payment solution because we want Nigerians and Africans at large to experience the best of service at their convenience. This means we constantly evolve to be more relevant to customers and society.”

He added: “We are extending KongaPay to other consumers outside of the Konga.com’s platform because it is designed to be fast, reliable, secure, flexible and above all provides a best-in-class financial solution to Nigerians and Africa at large.”

Speaking further, Adekoya said: “What this means for the e-commerce sector in Nigeria is that commerce really is beyond one location. This means that Konga has stepped outside the www.kong.com url.

Vanguard, MONDAY, MAY 2, 2016 — 27 “We are approaching an emergency on this crisis, because not only is the crisis spreading like wild fire across the states, it is assuming a dimension that would seriously affect the economy of the country…the Federal Government must address the problem now, even if it means having recourse to our reserves ..APC spokesman from South West State.

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eaders would permit me if the APC spokesman is not identified.

He is a long term associate and one of those who have helped me as a columnist in the early years. Like Shakespeare, 1564-1616, “I hate ingratitude more in a man than lying, vainness, babbling drunkenness or any taints of vice” (VANGUARD BOOK OF QUOTATIONS p 103). But, that far I will go and no further. The crisis he spoke about is well-known: salaries crisis which has engulfed the nation. His own state might not even be the worst – but is very close to it. The state is definitely the closest to an eruption because the situation there is almost hopeless – given the monthly collection from Abuja, which had dwindled to almost nothing.

Unfortunately, the spokesman is not an economist. He is a journalist and a lawyer. That explains why he hinged his appeal on what amounts to grasping at straws by a drowning man.

His reference to “having recourse to external reserves” if it represents the views of the government he serves would indicate that nobody in that state government has a basic understanding of economics and why countries maintain external reserves.

He and those in the state

government who think along those lines probably think the external reserves are like a savings account which the owner can access and draw down any time he feels like it. Nothing can be further from the truth. Any state waiting for the Federal Government to deplete the external reserves just to bail her out of the salaries crisis is living in a fool’s paradise. Even if accepted and implemented, it will not solve the problem for more than three months. Then what follows?

The Federal Government’s response recently, granting relief to states from repaying one month’s installment on the bail-out received late last year, is in reality, too little, too late and an exercise in futility.

It amounts to putting plaster on feet run over and badly crushed by a trailer. It would not help much. Quite the contrary, it will further promote fiscal irresponsibility by state governors for reasons too numerous to disclose in a short article. But, here are a few to consider.

CONTINUOUS LOW AGGREGATE REVENUE Most problems caused by money can mostly be solved by money. Allied to money is financial discipline and wisdom. By and large, the Federal and State governments of Nigeria had demonstrated neither fiscal

Bailing out states: FG’s exercise in futility discipline nor wisdom. For instance, anybody reading the papers these days must ask if those who were going to the Central Bank to truck out billions of naira and millions of dollars, while infrastructure decayed can be regarded as disciplined – or even sane. Over N40 trillion is now being traced – more than six times this year’s budget and ten times last year’s budget. Obviously, our problem is not money; but discipline, sanity and wisdom. Let those hoarding those funds return only one quarter and we would not need a kobo of loan from anywhere and there will be sufficient funds to fund every project in the current budget.

However, since we are unlikely to receive reparations soon, it is important to understand where we stand, so that desperate state governments will stop making silly requests of the Federal Government which for political reasons Buhari wants to grant in one way or another.

For decades to come, the years 2012 and 2013 will be

DISTRIBUTABLE REVENUE FG, STATES AND LG Feb 2012 Nov 2015 Feb 2016 March 2016 N620.73bn N473.83bn N338.77bn N299.75bn remembered as our golden years during Nigeria’s Age of Oil. Crude prices reached dazzling heights (up to $145 per barrel in one month) averaging over $110 per barrel in those two years, which unwise people in government at all levels assumed would never end.

When recently, Dr Ngozi Okonjo-Iweala, the Federal Minister for Finance at the time, accused the governments of lacking the will to save, many regarded the statement as intellectual dishonesty. If the states refused to save, what stopped the Federal Government from saving? The former Minister is now preaching what she failed to practice when in office.

From 2012 to early 2014, all the governments spent all they received. That was bad enough. They also went on a borrowing spree based on those high revenue allocations from Abuja.

Nobody gave a thought to

tomorrow. Tomorrow is here.

Let us now look at what has happened.

Meanwhile, in 2009, all the states of Nigeria had foreign debts amounting to N242 billion with the top ten including Lagos (the perennial champion), Oyo, Kaduna, Cross River, Katsina, Bauchi, Akwa Ibom, Osun, Ogun and Imo. In 2015 alone, the same states borrowed from commercial banks N13.1 trillion. That figure excludes external debts piled up by some of the states as well as bond issues. The top ten were: Lagos, Rivers, Kano, Oyo, Delta, Kaduna, Cross River, Enugu, Ogun and Abia. The interest on loans in 2015 was almost equal to the debts in 2009 and it was being incurred against dwindling revenue. In some states debt servicing exceeds monthly wage bill. That is one major reason why salary bail-out is an exercise in futility..

Microfinance

LAPO client base hits 2.2m with 92% women Stories by

PROVIDENCE OBUH

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APO Microfinance Bank has recorded a client base of 2.2 million across the country with women acounting for about 92 percent of that figure.

Also, the bank signed-on Nigerian broadcaster, Omotunde Adebowale, popularly known as Lolo1 of Wazobia F.M as Brand Ambassador.

Speaking at the unveiling ceremony in Lagos, Managing Director, LAPO MfB, Dr. Godwin Ehigiamusoe, said that the decision to engage Lolo was strategic in enlightening LAPO’s target audience on the various financial services the bank offers to improve lives and support the growth of small and medium scale businesses in Nigeria.

Ehigiamusoe pointed out that there are small scale entrepreneurs who do not have access to finance or even have the capacity to meet the tough conditions set by commercial banks when accessing business loans.

He said, “This is why LAPO is in business-to support small scale by breaking the barriers set by commercial banks. We have been very concerned about the challenges that women especially those at the bottom C M Y K

end of the society face and so today we have over 2.2 million clients across the country and women accounts for 92 percent of that and we do not think we are going to change that proportion, what may happen is that, that proportion may continue to increase.

“To this end, it is appropriate we have a personality who is not just a woman, but one who

through her carrier had shown so much concern about the challenges of women. This partnership will bring expansion, this is first time we are having a brand ambassador,” he said.

The MD expalined that the rationale behind the choice of Lolo as the brand ambassador was strategic to the goal of the bank in reaching five million clients

by 2017, saying, “weproud to be associated with LOLO as ambassador, she will lend credence to the Bank’s continuous support to entrepreneurs,” he said.

In her response, Adebowale expressed joy at the honour, “To have been chosen as the face of LAPO MFB in Nigeria is humbling and encouraging. I identify with the LAPO brand as

being committed to supporting small and medium scale businesses in Nigeria for the past two decades. It’s a delight to bring joy to customers and drive home all the important messages of the brand.

Am passionate about small businesses because they are helping our economy grow, lapo has been empowering a lot of women, for that they are so dear to my heart, I have done LAPO 10years back, she said.

ITF moves to strengthen students industrial work experience

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HE Industrial Training Fund, (ITF) said it has commenced moves to strengthen the Students Industrial Work Experience, (SIWES) in order to stimulate and sustain industrial development, grow the economy and create jobs in line with the vision of the Federal Government.

Speaking during a stakeholders summit organized by the agency, the Acting Director General of the Fund, Mr. Dickson Onuoha, said the agency will also meet regularly with both regulators and other stakeholders to think outside the box so as to improve the standard of the SIWES scheme.

He explained that the SIWES scheme was established by the Federal Government to solve the problem of lack of adequate skills preparatory for employment in the industrial sector by Nigerian

graduates of tertiary institutions.

Onuoha said that the scheme which exposes and transit students from classrooms to the practical world has been grappling with the challenges of inadequate funding due to increasing demands on government’s revenue and the increase in the number of students graduating from the nation’s tertiary institutions.

He described the SIWES as capable of bridging the gap between theory and practical realities in the nation’s industrial sector, pointing out that ITF will continue to evolve innovative methods, considering that the scheme has continued to prepare students for the world of work.

According to him, “ITF will continually strive to remain the leading human resource development organization that will be focused on improving

industrialization and quality of working life. The agency will remain focused on achieving the cardinal goals of the President Muhammadu Buhari led Federal Government that emphasizes job creation and youth empowerment.

Meanwhile, he disclosed that the reorganized and strengthened SIWES administration, coupled with understanding with stakeholders will facilitate the training and development of youths and entrepreneurs in the country, explaining that the collaboration was critical in order to have an effective local skills and manpower development that can drive the Federal Government’s economic diversification agenda.

On his part, the Director General of the Manufacturers Association of Nigeria, (MAN),

Mr. Remi Ogunmefun, said the association will effectively collaborate with the ITF to ensure practical experience was extended to Nigerian graduates in the nation’s industrial and manufacturing sectors.

Dignitaries at the summit includes: Representatives of the Federal Ministry of Industry, Trade and Investments, the Federal Ministry of Finance, the Manufacturers Association of Nigeria, (MAN), the National Universities Commission, (NUC) and National Board for Technical Education, (NBTE).

The National Commission for Colleges of Education, (NCCE) and representatives of various students’ union groups from the National Association of Nigerian Students, (NANS) also attended the summit.

28 — Vanguard, MONDAY, MAY 2, 2016

People in Business production manager, production staff, I do the media content stuff, and I run the website, I design the label, I do product development.

Basically, I am a jack of all trade when it comes to YesChilli.

One of the good things about this is that it helps you know your product inside out and then you acquire skills you didn’t know you could acquire.

It’s been a fantastic experience for me.

The major challenge is creating awareness about the product, and I am severely handicapped because I don’t have a huge financial budget.

In fact, my financial budget is about zero. Distribution is another challenge for the same reasons. We are slowly getting out there; we are in about 87 stores around Lagos and I am talking to one or two big shops presently, but I need to be talking to a lot more.

I ventured into manufacturing ‘cos’ job market isn't buoyant -— YesChilli boss

By Princewill Ekwujuru

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here are challenges of doing business in Nigeria, which Small and Medium Enterprises, SMEs envisage. In terms of the business environment, SMEs face challenges of infrastructure and finance. As presented in the World Bank ranking on the Ease of Doing Business, Nigeria lags behind.

Among other challenges, the country lacks policy transparency and governance, these have made SMEs complain of difficult environment to do business, yet some individuals still forge ahead despite all the bottlenecks.

Background: rs Elizabeth Nwaizu is the Founder of YesChilli

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Ventures, makers of YesChilli and Ginger sauce.

She holds a BA English degree from the University of Jos and did her one year youth service at the Nigeria Television Authority. After her youth service, she joined the Official Solicitor’s Office in the Ministry of Justice in 2003 as a Senior Case Manager in the Family Litigation Team which looked after the interests of vulnerable parents in Children Act Proceedings. Nwaizu rose to become Divisional Manager of the Family Section in 2009, where she impacted the lives of clients and secured some useful decisions on their behalf in the House of Lords. She proceeded to England to broaden her horizon and returned to Nigeria in 2015 to give back to the society.

Motivation: Having worked in the civil service for so many years, Nwaizu decided it was time for a change. “There comes a time in life when you begin to fancy a career change or you are not exactly or fully satisfied with what you are doing or you want a stretch or you get bored. For me, it was a combination of all of that. Plus I wanted to come back to Nigeria to give back and also to be close to my mother who is getting aged. So I needed to have something to do when I came back to Nigeria.

The job market is not buoyant so I decided to go into manufacturing and food has always been a passion for me.

I just happened to be one of

*Mrs. Elizabeth Nwaizu....our catch phrase is Healthy convenience foods, 100 per cent natural

those lucky people that have been able to turn a passion into a living.

Product: We make tasty, healthy indigenous convenience foods that are attractively packaged and competitively priced. Our first product which is the YesChilli and Ginger sauce has been in the market since January 2016. Presently, we are trying to establish the YesChilli brand.

Funding: Nwaizu said she started the business with her savings. “I haven’t tried to access any funds because I will like to see the business grow organically first, and then when I hit the stage and need expansion, I will hopefully approach banks or private investors.

I know these funds are accessible but with stringent criteria. One is providing guarantors and when you have guarantors for a loan, you put them, their businesses and families at risk because if you don’t cover the loan, then they would have to fill that gap.

I don’t want to be in a position where I would put somebody else in that position. So for me, that will be a barrier for taking those loans because I do not have any collateral in Nigeria to put down against the loan Challenges: Well, I face the same problems as most Nigerian manufacturers. You spend quite

I just happened to be one of those lucky people that have been able to turn a passion into a living

a bit of your cash flow on generating power because the national grid doesn’t supply near enough of what is required. I spend about N15,000 a week on diesel.

As new start-ups, you know all the challenges new starters have like funding. I am the administration manager,

Future plans Two years from now, I would expect YesChilli to be a r e l a t i v e l y recognisable brand with at least four products in its range.

I am still trying to get even more territorial share of the convenience market. There are quite a few indigenous convenience food outfits, but our catch phrase is Healthy convenience foods, 100 per cent natural ingredients with no additives and no preservatives.

FSD graduates win BoI national skills competition

By Jonah Nwokpoku

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wo graduates of a Nigerian vocational academy, Field of Skill and Dreams, FSD, Amarachi Agufobi and Kehinde Oluwafemi have emerged winners of 2016 Bank of Industry’s National Skills Competition which is organised annually to encourage vocational skills acquisitions as a means of tackling the unemployment challenge in the country.

Amarachi Agufobi, a graduate of Economics from the University of Nigeria, Nsukka, and Kehinde Oluwafemi, who holds a Higher National Diploma in Business Administration beat other nominees from other vocational institutions across the country, to clinch first and second positions in the fashion designers’ category.

The duo started their journey at the Ikeja-based vocational training centre, FSD Academy in 2015. The Imo State-born Agufobi, who won the fashion competition with a wedding gown made with local fabric,

told Vanguard she was trying to complete her one year NYSC programme when she registered for the nine-month intensive course in fashion at FSD. On his part, Oluwafemi had finished his national service and had a stint in cloth-making at a roadside shop, but, according to him, joined the FSD in order to gain more professional experience.

Their decisions paid off in the form of cash prizes and equipment they will get from BoI to set up their fashion shops.

Agufobi said she had no intention of seeking a paid job anymore as her new-found vocation has the potential to help fulfill her childhood dream of running a successful business of her own.

She said: “I have always wanted to be a successful business woman but I needed to acquire education first. With my sewing skill, I think I am close to fulfilling my dreams. I want to start my business so that I can grow to become an employer of labour.”

On the difference the award has made in her life, the 26year-old Economics graduate said it has boosted her confidence and many clients now have more confidence in her abilities.

“I cannot believe that I, the same person who was making clothes in the corner of a room have received a national award in fashion designing. Apart from the prestige and financial reward, what interests me most is that successful fashion designers have accepted to mentor me. For me, this is the most valuable aspect of the honour. Above all, I appreciate FSD who took time to train me.

The award would not have come without the centre,” she said.

Agufobi called on Nigerian youths to take advantage of the opportunities made available by the FSD and other training institutes to acquire skills that would make them self-reliant.

She said she would always be grateful that she enrolled for skills acquisition instead of wasting her free time during her NYSC.

Vanguard, MONDAY, MAY 2, 2016 — 29

Economy

IMF calls for depoliticisation of budget, steady increase in VAT

By EMEKA ANAETO, Economy Editor

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midst lingering crises in the 2016 budget, the International Monetary Fund, IMF, has proposed a “depoliticized” oil-based fiscal policy to shield the budget from controversies that stall smooth passage as well as hamper impactful implementation.

The multilateral financial institution made this proposal in the full report of its 2016 Article IV consultations published last weekend which shows further details of the staff report submitted to the executive board in late March, 2016, with the executive summary made public early last month.

The report failed to explain in details what it meant by depoliticisation neither did it allude to the long-drawn battle between the executive and the legislative arms of government.

In the latest report, the Fund, however, suggested a combination of the oil price over the past five years, the current price and the forward level over the next five years, together with a primary surplus target (before interest payments), to determine benchmark.

The 2016 budgeted benchmark was set at USD38 per barrel but before the budget could go through the passage process the

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international price had gone down to USD30 per barrel before rebounding to over USD46 previous week.

The report also calls for a steady increase in the standard tax rate with specific reference to the Value Added Tax, VAT, from 5.0 per cent to

•Kemi-Adeosun, Finance Minister 7.5 per cent, noting that the Economic Community of West African States, ECOWA S , require a minimum 10 per cent.

The Fund was basing its tax suggestions on the adverse effect of dependence on oil

export for budget funding, a situation which has forced governments at all levels into borrowings.

The baseline fiscal projections for the federal government this year have

non-oil revenue collection lower than in 2015 and a poor performance from independent revenue, of which the authorities have high hopes based upon the treasury single account, TSA. In the first publication of the Article IV Consultation report the Fund had favoured a more flexible foreign exchange policy to replace what it terms a “soft” or a “de facto peg”.

Central Bank of Nigeria, CBN, had imposed what the Fund views as exchange restrictions and a multiple currency practice under Article VIII of the Articles of Agreement.

The restrictions include the circular of foreign exchange restrictions covering imports of 41 items and the allocation of foreign exchange in line with the CBN’s own priorities.

FDC advises FG, CBN on import substitution policy T he current drive for import substitution by the present government also championed by the Central Bank of Nigeria, CBN, has been suspected to be fraught with motives other than strategic policy initiative.

According to a report by Financial Derivatives Company Limited, a Lagos based economy research outfit, the import substitution strategy in Nigeria in the present dispensation “seems to be borne out of fear and capricious thinking rather than clear economic rationalization”.

In the research report the company stated that “the CBN shut official access to foreign exchange for the importation of selected items using import substitution as a smokescreen for the real exchange rate issue of currency misalignment and forex scarcity facing the country”.

The report, therefore, advised that rather than have a blanket policy towards import substitution and trade controls, a case by case approach that limits the importation of goods based on a comparative advantage analysis should be used.

“In essence, a temporary import substitution for select commodities in which Nigeria has potential comparative advantage should be pursued”, it advised.

According to the report the country

should also have an export-oriented economic vision to spur growth and development while also reducing dependence on imports.

“Countries such as Japan, South Korea and China that have used an export promotion approach attained a fast rate of economic growth despite beginning from a state of underdevelopment.

“This outward-looking strategy to development has led to growth not just in primary products and raw materials segment, but also in manufacturing”.

The report also stated that incentives and governmental support are required for successful reduction in import content and export development, adding that the success in the development of the cement industry to its present state, where it is dominated by local cement manufacturers that also export, can be replicated in other sectors.

This, strategy, according to the report, is necessary especially in agriculture where government can provide subsidized financing, inputs and machinery. “There could also be incentives to attract foreign investors as they respond positively to favourable trade and forex policies. It is critical to make the business environment attractive to foreign investors so that they can bring their capital, technology,

managerial and technical experience to the country”.

The report also recommended that a combination of temporary selective protectionist restrictions, innovation, governmental support, human capital development and an effective exportdriven master plan is required to catalyze Nigeria’s economic and industrial development.

The report had cataloged the general impacts of the CBN’s restrictive foreign exchange policy which includes a significant reduction in manufacturing output given that many of the products on the list of the 41 items with forex allocation restrictions are intermediate goods, which are critical inputs to several manufactured products.

It also stated that the policy has resulted into lower profitability and higher production and operating costs, as well as higher credit defaults with foreign suppliers due to the lack of forex to settle obligations.

On macroeconomic level, it stated that the policy had led to increased inflationary pressures, higher unemployment due to the closure of several manufacturing companies as well as negative perceptions of the country as an investment destination.

30 — Vanguard, MONDAY, MAY 2, 2016

Aviation

Arik Air launches ground transfer service for London passengers

By LAWANI MIKAIRU

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rik Explorer, Arik Air’s leisure and packaged travel subsidiary, is launching a ground transfer service for London bound passengers from Heathrow Airport to destinations within London city.

The ground transfer service is in collaboration with Puzzles Group and Hummingbird cars.

According to Mr Adebanji Ola PR and Communication Manager, Arik Air, “All London bound passengers departing Lagos will be able to book this service at Murtala Muhammed International Airport with the option to pay in Naira. With this service, London-bound passengers need not worry about having immediate access to foreign currency on arrival at Heathrow. “ “The collaboration makes the services of a reliable and reputable transport company accessible to Arik Air travelers from prices as low as thirty three pounds (£33) one way (or its Naira equivalent). Arik Air passengers will be able to book this service at the Arik Explorer stand at the Arik Air check-in counter located in the departure hall of Murtala Muhammed International Airport, Lagos from May 3, 2016.”

Cliqfest promo: MAPOLY student wins car

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Etisalat product, Cliqfest, stopped at the Moshood Abiola Polythenic, a HND 1 student made home with a car. The initiative a strategic engagement with Nigerian youths by Etisalat Nigeria is focused on education, sports and entertainment in a fun and relaxed atmosphere.

The two-day event culminated in the emergence of Ogundeyi Ayobami, a HND1 student of Accounting as the winner of the star prize, a Hyundai i10 Car through a raffle draw. An elated Ayobami was full of praises to Etisalat for giving him the wonderful opportunity to experience Cliqfest. “I never believed that I would win a car today and I am still surprised.

Speaking on the Cliqfest initiative with Nigerian students, Debo Agun, Manager, Consumer Segment, Etisalat Nigeria described the engagement level with the students of MAPOLY as a great experience for the brand, and pointed out that this is the second time the Cliqfest train will be visiting the school, having debuted at the school last year.

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AGM - From left: Mr Ladi Balogun, Non-Executive Director, FCMB Group PLC; Mr Jonathan Long, Chairman; Mrs Olufunmilayo Adedibu, Company Secretary; Otunba Subomi Balogun, founder and Mr Peter Obaseki, MD/CEO, during the 3rd FCMB Group PLC Annual General Meeting held in Lagos.

Booking keeping, airlines debt recovery imbroglio

By LAWANI MIKAIRU

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he protracted debt reconciliation problem between the Federal Airports Authority of Nigeria, FAAN, and domestic airlines has brought to the fore once again the popular view, or what is almost becoming a fact, that government ministries and parastatals do not keep proper accounting records of financial transactions they engage in.

Or how can one explain a situation where receipts or tellers , allegedly, cannot be produced by FAAN to back financial figures which keep changing at every debt reconciliation meeting with airlines? Is it not elementary accounting that books are opened for any customer or client you do constant business with, and every transaction recorded immediately it takes place?

Last week, the nation's aviation industry witnessed the disruption of Arik Air flight operations by aviation workers under the aegis of the National Union of Air Transport Employees (NUATE), the Air Transport Services Senior Staff Association of Nigeria (ATSSSAN) and the Nigerian Union of Pensioners (NUP), at the General Aviation Terminal (GAT) of the Murtala Muhammed Airport, Ikeja, Lagos over N12.5 billion debts they claimed Arik Air is ownig FAAN. The unions said Arik Air’s failure to pay the debts has incapacitated the Federal Airports Authority of Nigeria (FAAN) and made it unable to meet its obligations to employees and pensioners.

This is not the first time the unions will be disrupting the airline’s flight operations. Last

year a similar incident took place and the airline's flight operations were grounded for two days which led to untold

If proper records of financial services rendered to Arik had be properly kept and documented, this needless disputation of figures would not arise

hardship for air travelers as Arik Air has the largest fleet among domestic operators in Nigeria and airlifts more than fifty percent of the passenger traffic on domestic routes.

Commenting on last week's incident, Arik Air Managing Director, Mr Chris Ndulue, said the disruption is unfortunate, adding: “When the revenue drive was ongoing and our operations were grounded, we tried to reach the management of FAAN via phone calls and they did not respond and even text messages and up till now, as we are speaking, they have not

responded. It is curious, why is it only Arik? Others are owing, even foreign airlines, but why Arik? The figures they bandy about, sometimes its N7b or N11b or like yesterday N12.5b.”

Also Arik Air Chairman, Sir Johnson Arumemi-Ikhide said the airline had paid FAAN N18.9 billion since inception.

He frowned at the way the unions took the airlines by surprise while alleging that FAAN had been frustrating the reconciliation process initiated by both the court and past aviation ministers.

According to him “We have paid N18.9billion and we are saying that we need to reconcile. FAAN was the one that took us to court and are the ones that are not respecting court judgment. And anytime we want to reconcile these debts and get to the bottom of this matter once and for all, they (FAAN) become evasive.

“We are prepared to pay for services rendered to us but we are not going to be bullied into false payment. When they feel like, they resort to intimidations.

They took us to court and said they will impound our aircraft and later rescinded but what happened was quite unfortunate. It is not good for aviation and not good for Nigerian industries.” ArumemiIkhide also recalled how efforts were made to resolve the dispute by the Senate Committee on Aviation, headed

by Senator Hope Uzodima, former Aviation Minister, Mrs Stella Oduah and former Permanent Secretary, Ministry of Aviation, Mrs Binta Bello.

Domestic airlines pledge to pay debts owed NCAA

By LAWANI MIKAIRU & DANIEL ETEGHE

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he Airline Operators of Nigeria, AON, has pledged to ensure that all outstanding debts they own the Nigerian Civil Aviation Authority, NCAA, are paid as agreed in a meeting with the agency.

According to Mr Sam Adurogboye, General Manager, Public Relations, NCAA, the assurance was given during a meeting between the management of the regulatory authority led by the Director General, Capt.

Muhtar Usman and the Airline Operators at the NCAA Conference Room.

Adurogboye said “Speaking on behalf of the operators, the AON Chairman, Capt.

Noggie Meggison remarked that it is incontrovertible that operators are heavily indebted but promised that all unremitted funds will be fully paid.

“He thanked the DG for holding a series of meetings with all operators, a move he said was long expected. Meggison therefore requested for similar fora¨ where the Authority’s vision will be properly articulated from time to time to enable us key into it.”

He added that Meggison, however, called for a retreat where stakeholders will meet to brainstorm on some knotty challenges which operators and the entire industry is

confronted with.

“In his response, Capt.Usman enjoined the airlines to comply as agreed because the issue of Ticket and Cargo Sales Charges is sacrosanct. According to him, this is to enable the Authority and other benefitting Agencies effectively carry out its regulatory and Statutory responsibilities.

“The DG and the NCAA management emphasized the need for automation by operators which will offer real-time and transparent transaction. He directed that all reconciliations must be done within the 60 days window provided. He advised the operators to forward all required documentations to verify conflicting claims.”

“Capt. Usman admonished the operators to be alive to their responsibilities and challenges. He added that operators should take advantage of various Bilateral Air Services Agreements (BASA) entered into by the Federal Government to compete with their foreign counterparts thereby generating the much needed foreign exchange.”

“Concluding, the DG assured the operators that there will be a broader stakeholders’ forum very soon where various grievances could be looked into and addressed and charge the operators to fully embrace the Automation for the sake of transparency and an end to discrepancy over figures forthwith.”

Vanguard, MONDAY, MAY 2, 2016 — 31

Advertising & Media

Whither digital hydro advertising?

STORIES BY PRINCEWILL EKWUJURU

perception game with their image, making clients believe they are top there, with display

of splendour, big buildings, clean and green environment, even though it is believed that

D

igital hydro advertising seems to have died in Nigeria along with Late Managing Director of Spot-On Media, Sesan Ogunro. Since his demise, no ad agency has been able to replicate or repeat the feat exhibited at the Marina waters

by Falomo Bridge, Ikoyi, Lagos, first of its kind in Africa.

Digital Hydro advertising is water advertising. It is a vast and seemingly holographic imagery that offers a great fusion of art and technology on a natural canvas, the result of which can cause members of the public to pause in admiration of the creativity.

This feat has only been achieved in top cities like New York, Toronto and Dubai. What would have been the challenge

by Nigeria ad agencies.? And why has this masterpiece not been replicated by corporate organisations to launch their products.?

Is it that Ogunro died with the idea, connection and technology? No wonder they say millions of ideas can be found in the grave. Or is water advertising not still relevant in today’s advertising world.?

Is it that the agencies are so cash strapped that they cannot muster the courage to repeat a feat as such by Spot-On Media.? Or that organisations will not be able to foot the bill.?

Why is it that agencies like Insight Communications, Lowe Lintas, Centre Spread, Invent Media, New Crystal Communications Limited, ClearEdge Media Limited to mention but few cannot repeat this feat?. Or is it that the present economic circumstance is biting hard on them?.

Or are they just playing the

PRESENTATION: From Left, Chief of Staff to the President, Nigerian Institute of Public Relations, NIPR, Mr. Willy Ogbidi, President, Public Relations Consultants Association of Nigeria, PRCAN, Mr. John Ehiguese and Vice President, PRCAN, Mr. Muyiwa Akintunde at the presentation of office equipment by NIPR to PRCAN Secretariat in Ikeja.

KairosWebTV launched, set to boost entrepreneurship K

airosWebTV, a nextgeneration online TV platform for emerging and aspiring entrepreneurs and start-ups, has been launched to transform the Nigeria online television landscape. Its offers news and insights, technology trends, edutainment, skits, events and online digital training.

The television is owned and ran by CIHAN and focuses on motivating and inspiring viewers to success. It features seven channels with content from partners across over the

world such as Fate Foundation, Real Success (South Africa), Nigerian Olympic Committee and The Winlos, among others.

At the media briefing in Lagos, Chief Executive Officer of CIHAN, Mr. Celestine Achi, who is the founder of KairoswebTV, said that KairosWebTv was designed to save cost for the viewers, adding that the era of reaping off payTV viewers must be challenged through disruptive technologies.

Achi, a Digital PR strategist and social techpreneur, said that KairosWebTv had been

Chi’s vegetable, fruit nectar drinks enter market

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perception is everything.

Is it that the above mentioned agencies cannot develop an outdoor masterplan to rival major cities of the World.? What is the problem.? Is creativity lacking or lagging?.

Nigeria is blessed with great opportunities for water advertising, with the attendant potentials to promote sport, business, tourism and transport activities. If the infrastructural development of Nigeria is symmetrically and strategically developed by government and if adequately utilized by creative agencies will be an advantage conferred by nature and this will lead to economic boast for Nigeria and the agencies. While the dredging and channelization of several waterfronts will be geared towards enhancement of aquabased activities.

With all these in place Hydro platform will encourage practitioners to be more innovative with outdoor advertising formats, especially water, the platform will be a hit as many companies will indicate interest to use it to grow their bottomline.

or the first time in the fruit juice market history, consumers’ who place a premium on health consciousness can now satisfy their need for healthy drinks with the introduction of Chivita Active Vegetable & Fruit Nectar.

The company said this is an innovative product and an addition to products from Chi Limited production line. With the power of vegetable and fruit, perfectly blended with the goodness of vitamins, fibre and nutrients, Chivita Active vegetable fruit nectar is a healthy and tasty way to get antioxidants and stamina required for a healthy active lifestyle.

The company said the product producd with no artificial colours, flavours or preservatives and available in three variants – Carrot Orange, Beetroot Grape and Beetroot Apple. The Carrot Orange variant comes with a burst of Orange and the goodness of carrot to ensure a great taste and a healthier lifestyle. While the Beetroot Grape is a tasty blend of beetroot and grape which

guarantees stamina and rich antioxidants. The Beetroot Apple variant which is a mix of beetroot and apple ensures a healthier and active lifestyle through the stamina, antioxidants and wellness it provides.

According to Roy Deepanjan, Managing Director of Chi Limited, “We are once again pioneering a new segment of the juice market with the Chivita Active Vegetable & Fruit Nectar in line with our market penetration strategy. As an innovative company, we are always looking for new ways to excite and invigorate the market which is why we will continue to develop the right products, that meets market expectation of consumers who are health conscious, in the years ahead”.

The space created by the growing need for the consumption of healthier drinks at home, offices and parties may in no time be filled in by Chivita Active Vegetable & Fruit Nectar as the popular choice going by the highly nutritional benefit of the drink.The Managing Director said.

configured to save users’ data, “which has been the reason some people are keeping off the online platforms. We want to restore confidence in the minds of digital natives, while providing enabling ground for the digital migrants to exploit the power of the internet. Whether you are on 2G, 3G or 4G LTE, the experience will be such that videos should show seamlessly.”

The CIHAN CEO said that the platform would deepen local contents as part of measures to boost the digital migration through Nollywood contents.

He explained further, saying various channels of KairosWebTv: “The Entrepreneurship Channel focuses on motivating emerging entrepreneurs and startups. We are doing that through three key partnerships. The NetNEWS Channel provides up-to-date news on entertainment, politics, business and sports. We will even go deeper to give you news behind the news, which is usually the human angel stories.”

Achi added: “KairosWebTv also recognises the need to inspire creativity. That is why we have the Winlos Channel, which uses creative, inspiring and hilarious skits and sketches as well as dramatic illustrations to motivate viewers based on real life issues. The TechSavvy Channel delivers news and insights on the latest technology trends.”

NB extends Maltina’s initiative to private schools

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igeria Breweries, NB Plc says it has expanded the scope of the Maltina Teacher of Year, MTY competition to include teachers in private schools, even as it commences collection of applications with effect from April 17, 2016.

It could be revealed that the first edition of the program focused solely on public secondary schools in 2015.

Speaking in Lagos, Mr. Kufre Ekanem, Corporate Adviser of NB, said: we have expanded the focus of the 2016 edition of the Maltina Teacher of the year Award to include teachers from private secondary schools across Nigeria.

He went to say that the NBFelix Ohiwere Education Trust Fund, in 2015 expanded its intervention in education in Nigeria to teachers through the Maltina brand.

Ekanem stated that the initiative was hinged on the fact that teachers seldom get recognition they deserve in spite of the pivotal role they play in training, coaching and determining quality of education impacted in pupils.

StarTimes wins best 2016 BoICT award

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tarTimes, a pay-TV operator has clinched the Best Pay TV Operator in Nigeria award at the just ended Beacon of Information and Communication Technology, BoICT awards in Lagos.

Speaking on the achievements, Mr. Ken Nwogbo, Editor-In-chief and CEO of Communications Week Media Limited, organisers of the awards, said over time, StarTimes has revolutionarised the Pay TV industry landscape in Nigeria with its consistently affordable and public friendly offerings.

“Since StarTimes joined the industry, Pay TV has become more popular and accessible for many people.”

Receiving the award, Marketing Director, Oludare Kafar expressed appreciation to millions of StarTimes subscribers who made it possible with a promise of better subscribers experience.

“As a business, we have embraced innovation and cutting edge global technology solutions to deliver compelling digital television experience to our millions of subscribers.

32 — Vanguard, MONDAY, MAY 2, 2016

(0805 220 1997)

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he leadership of organised Labour Unions, last week presented a new demand for N56,000 monthly minimum wage, to the federal government. The President of Nigeria Labour Congress (NLC) Comrade Ayuba Wabba told a news conference in Abuja, that even though it is true that the economy is not doing well, but the law has stated that wages for workers must be reviewed after every five years”.

Consequently, the Labour Lord insists that since the last wage review was in 2011, “the issue must be looked into by the Federal government and workers should not be seen as sleeping on their rights”.

However, a triple increase in income, in one fell swoop, may seem inappropriate when several state governments are presently incapable of paying the current N18,000 minimum wage, while street cleaners and other Labourers in state government establishments nationwide earn much less.

Ayuba, however explained that the “logic behind the new minimum wage is to ensure that no worker earns below what can sustain him or her for a period of 30 days”. Nevertheless, despite their apparent determination, it would not be unexpected, if Labour unions, ultimately, patriotically accept between N30-N36,000 as the new minimum wage, after heated and protracted negotiation; the impact of such increase in incomes will regrettably, however most certainly, cripple the economies of several states, as the resultant simultaneous spiral in salaries of all staff cadres will double the already heavily lopsided recurrent State budgets and further diminish any prospect of impactful social infrastructural development.

Ironically, however, despite the inability to currently pay salaries in several states, Ayuba, has called on government to ensure that the issue of National

increases, notwithstanding the disenabling collateral impact of such demands. However, it is now expedient for Labour to also carefully examine how countries with larger, and more successful economies manage inflation below 2% to conserve the value of all income earners and sustain the tempo of consumer demand and steadily drive growth; Labour will also need to interrogate why it is seemingly impossible to bring cost of borrowing well below 10% to facilitate real sector growth and export competitiveness.

In reality, successful economies everywhere, sensitively manage money supply to ensure that excess money supply does not trigger inflation; furthermore, productivity is also encouraged with very low interest rates which will drive real sector growth.

Unfortunately, organised Labour has never shown any interest in identifying why CBN consistently failed to effectively manage Naira supply in like manner to power economic growth as in other successful nations, especially when, CBN does not deny that the monetisation of distributable dollar revenue (read as unilateral substitution of Naira for dollar denominated revenue) is actually the primary cause of persistent excess Naira with its train of disenabling monetary indices such as unusually high inflation and interest rates and a weaker Naira (see monetary thrust statement of vision 2020).

Conversely, better liquidity management, particularly in the forex market can gradually strengthen and sustain the Naira below N100=$1. In such event, the subsisting N18,000 minimum wage, would now command a purchasing power of N36,000 without any wage increase or further negotiations.

N56,000 minimum wage or a stronger Naira? minimum wage increase “was urgently taken on board as a way of fighting corruption in the country”, because, according to the Labour Chief “ If employers failed to cater for their workers’ welfare adequately, it would be difficult for such an employer to fight corruption”! Unfortunately, Ayuba’s prescription against corruption has continued to be blatantly abused by several states, without any sanction, despite the subsisting Act for a minimum wage of N18,000.

Consequently, the nexus between minimum wage levels and corruption is such that, even if the ghost population, in public service is halved, the fifty percent of ghosts, who may ‘survive’ the cleansing will invariably also have their incomes doubled, if minimum wage increases by 100% or more as presently proposed.

However, the preceeding narrative does not suggest that there should be no minimum wage level.

Indeed, as Ayuba also rightly pointed out, the purchasing value of the present N18,000 wage was equivalent to about N110= $1 in 2011; Sadly, with present exchange rate of N200300=$1, the purchasing power of the same Naira income against dollar values may have also become halved below what N9,000 can buy today.

Furthermore, with average annual inflation rate of about 8%, static minimum wage earners may barely have the capacity to buy the equivalent of 60% of the purchasing power of their incomes five years ago.

Invariably, high inflation rates significantly reduce consumer demand, discourage domestic production and ultimately fuel an already burdensome unemployment rate, with

poisonous social consequences.

Unfortunately, the very high cost of borrowing caused by an albatross of surplus Naira supply, invariably restrains the real sector’s capacity to also produce competitively for export. Nonetheless, even if Labour succeeds in negotiating a higher minimum wage, it is likely that, they may not be able to enforce compliance nationwide, particularly if state finances remain challenged.

Conversely, if by some stroke of good fortune, increasing revenue becomes available to make the payment of N56,000 feasible, the joy of such victory will be quickly threatened by a rise in the general price level, from the already volatile, current spring board of 12.8% inflation rate to well above 20%, so that a N36,000 minimum

Organised Labour has never shown any interest in identifying why CBN consistently failed to effectively manage Naira supply

wage, for example will after five years lose over 90% of its present purchasing power, to trigger another tortuous train of negotiations for a new minimum wage.

Instructively, reprieve from this cyclical bondage may however come, only if inflation can be tamed to best practice rates below 3%; unfortunately, however, an increase in money supply, inevitably caused by 100% rise in wages would, however make such fine achievement in monetary management impossible.

Furthermore, increased money supply would also quickly compel CBN to step up the usual, expensive, compulsive counterproductive borrowings, it persistently embarks on to reduce bloated Naira values in the financial system and restrain inflation. Unfortunately, this process also instigates higher interest rates and similarly crowds out the real sector from ready access to cheap funds for expanding domestic production and creating jobs Painfully, this bizarre cycle has predicated our economic misfortunes for so long; thus, it was inevitable that our economy tottered endlessly while unemployment rate continued to spiral, even when we flaunted huge foreign reserves and sustained more modest domestic debt levels. Thus, Labour should recognise, from the preceeding narrative, that the joy of a substantial increase in minimum wage would be short lived, while increasingly sporadic wage demands will become more regular, if inflation remains untamed.

Unfortunately, organised Labour’s leadership remains rooted in the classical mode of persistent calls for wage

•Save the Naira, Save Nigerians!

Business & Economy Nigeria imports N165bn fruit juice annually — MAN

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igeria spends N165 billion annually to import fruit juice, the President of the Manufacturers’ Association of Nigeria (MAN), Dr Frank Jacobs, has said.

In a paper presented at a workshop organised by the Raw Materials Research and Development Council (RMRDC) in Owerri weekend, Jacobs noted that in spite of the high rate of fruit production and a thriving juice market, the country imported fruits concentrates.

In the paper entitled “Promoting Investments in Concentrate Production,” he said the situation resulted in an estimated loss of one billion C M Y K

dollars annually.

Jacobs, represented by Mr Nwabueze Anyanwu, observed that Nigerian farmers also lost 60 per cent of their produce as a result of lack of processing facilities. He listed other factors to include limited demand and logistics challenges such as handling and transporting the fruits to the urban centres.

“Importation of concentrates has adversely affected local fruits cultivation for juice processing,” the MAN president said. He also said that the continued dependence on massive importation of concentrates by industries was not healthy for the nation’s economy. He said that

the availability of raw materials, a large market, a ready domestic concentrate and good export potentials should serve as incentives to attract investment in the project.

Jacobs said that the challenge of poor concentrates in the country could be overcome with improved high-yield seedlings, technology and technical services and better education and enlightenment for farmers. He noted that the recent drive by the Federal Government to diversify the economy, encourage resource-based industrialisation and backward integration should provide the needed impetus to attract investors.

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