Nigeria, S-Africa, Egypt account for half of Africa’s economy — World Bank by Vanguard Media Limited

MAY 5, 2014

Nigeria, S-Africa, Egypt account for half of Africa’s economy — World Bank

•Global economy produced $90trn goods in 2011 •Switzerland, Norway, Bermuda most expensive economies •Malawi, Niger, Burundi, Liberia among lowest per capita •Bermuda, United States, China, Luxembourg impact citizens more BY OMOH GABRIEL, Business Editor

IGERIA, South Africa and Egypt account for about half of the African economy says new data released by the World Bank Group last week. The report which ranked global economies

on the basis of the strength of their currency said that China will overtake the United States of America by the end of 2014 as the largest economy in the world. The report said that low income economies, as a share of world GDP, were more than two times larger based on Purchasing Power Parity,

PPP, than respective exchange rate shares in 2011. Yet, these economies accounted for only 1.5 per cent of the global economy, but nearly 11 per cent of the world population. Roughly 28 per cent of the world’s population lives in economies with GDP per capita expenditures above the $13,460 world average and 72 per cent are below that

average. The International Comparison Program (ICP) which released the new data said that the world economy produced goods and services worth over $90 trillion in 2011, and that Continues on page 18

207.0

-5.45

2,943.00

-25.00

17.11

-0.01

109.55 -0.78 100.82 -1.12 CURRENCY BUYING CENTRAL SELLING DOLLAR POUNDS EURO FRANC YEN CFA WAUA RENMINBI

From left: Arunma Oteh, Director General, Securities and Exchange Commission (SEC); Dr. Yemi Kale, Statistician General, National Bureau of Statistics (NBS); and Bismarck Rewane, CEO Financial Derivatives Company Ltd at the 2nd Quarter SEC Learning Series on “The Rebased GDP and its Impact on the Nigerian Capital Market” which took place at SEC’s Corporate Head Office in Abuja. C M Y K

RIYA KRONA SDR

154.73 155.23 155.73 259.8845 260.7243 261.5641 213.9606 214.652 215.3434 175.291 175.8582 176.4246 1.5103 1.5152 1.5201 0.3074 0.3174 0.3274 239.1355 239.9082 240.681 24.7583 24.8387 24.9192 41.2569 41.3903 41.5236 28.6505 28.7431 28.8357 239.6768 240.4513 241.2258

CBN Exchange rate as at 02/05/2014

18 — Vanguard, MONDAY, MAY 5, 2014

Cover Story

Business Enterprise is the Answer for Change in Nigeria Part 2 Another factor that must be overcome is the fact that most entrepreneurs in the country reside within the city of Abuja. Business enterprise needs to be spread about the country rather than in just the city. When starting a technology-based business an entrepreneur can reside anywhere in the country that there is an internet connection and operate a business. However, other sectors are in need of entrepreneurs as well.

Which are the largest economies? According to the report, the six largest middle income economies are China, India, Russia, Brazil, Indonesia and Mexico which account for 32.3 per cent of world GDP, whereas the six largest high income economies are United States, Japan, Germany, France, United Kingdom, and Italy which account for 32.9 per cent. Asia and the Pacific, including China and India, account for 30 per cent of world GDP, Statistical Office of the European Communities (Eurostat) - and the Organization for Economic C M Y K

almost half of the world’s total output came from low and middle income countries. Six of the world’s 12 largest economies were in the middle income category (based on the World Bank’s definition). When combined, the 12 largest economies account for twothirds of the world economy, and 59 per cent of the world population. The PPP-based world GDP amounted to $90,647 billion, compared to $70,294 billion measured by exchange rates. Middle income economies’ share of global GDP is 48 per cent when using PPPs and 32 per cent when using exchange rates. The approximate median yearly per capita expenditures for the world – at $10,057 – means that half of the global population has per capita expenditures above that amount and half below.

Cooperation and Development (OECD) - 54 per cent, Latin America - 5.5 per cent (excluding Mexico, which participates in the OECD and Argentina, which did not participate in the ICP 2011), Africa and Western Asia about 4.5 per cent each. China and India make up two-thirds of the Asia and the Pacific economy, excluding Japan and South Korea, which are part of the OECD comparison. Russia accounts for more than 70 per cent of the CIS, and Brazil for 56 per cent of Latin America.

including France, Germany, Japan, and the United Kingdom. Twenty-three economies are showing a PLI of 50 or below. The cheapest economies according to the report, are Egypt, Pakistan, Myanmar, Ethiopia and Lao People’s Democratic Republic, with indices ranging from 35 to 40. Which countries are the richest and poorest in per capita terms? According to the World Bank, the five economies

The report further stated that “at 27 per cent, China now has the largest share of the world’s expenditure for investment (gross fixed capital formation)

South Africa, Egypt, and Nigeria account for about half of the African economy. Which countries are the most expensive? The report stated that going by the Price Level Index (PLI) which is the ratio of a PPP to a corresponding exchange rate, the most expensive economies in GDP terms are Switzerland, Norway, Bermuda, Australia and Denmark, with indices ranging from 210 to 185. The United States ranked 25th in the world, lower than most other high-income economies,

The improvement includes: ntrepreneurs are able to control their own lives and can lives and can obtain security for their families without government interference. The Nigerian government has now made it possible for Nigerian products to be shipped to Europe and the United States. If an individual wants to manufacture jewellery and sell it online, they can now market to U.S. and European customers. Entrepreneurs in Nigeria are being offered tax incentives, such as not having to pay so much in taxes. Increased price ceilings also serve as a great incentive. Modern technology is finding its way into Nigeria culture, making the country self-sufficient in the technology sector. Although there are still barriers to break through, there is nowhere to go but up. Business enterprise is the way in which Nigerian will become a developed nation.

Nigeria, S-Africa, Egypt account for half of Africa’s economy — World Bank Continued from page 17

with the highest GDP per capita are Qatar, Macao SAR, China, Luxembourg, Kuwait, and Brunei. The first two economies have more than $100,000 per capita. Eleven economies have more than $50,000 per capita, while they collectively account for less than 0.6 per cent of the world’s population. The United States has the 12th highest GDP per capita. Eight economies – Malawi, Mozambique, Central African Republic, Niger, Burundi, Congo, Dem. Rep.,

Continues on page 19

From left: Mr. Tope Adeniyi, Chief Executive Officer, Mansard Health Limited; E. Oluwabunmi Olapade-Olaopa, Professor of Surgery / Director, PIUTA Ibadan Centre and Professor Ayotunde Ogunsehinde, Acting Provost, College of Medicine, University of Ibadan at a cheque presentation by Mansard to the Pan-African Urological Surgeons Association's Initiative for Urological Training in Africa (PIUTA), Ibadan Centre, University of Ibadan and University College Hospital, Ibadan, Oyo State.

The improvements uge strides have been made in the last few years to try to tackle the many endemic problems which assail the country with political and economic stability being seen as the key weapons in attacking the corrosive influence of corruption. Whether the actions being taken on the ground now lead to dramatic improvements in levels of transparency and levels of corporate governance remain to be There have been a number of improvements that is allowing Business enterprise to grow. If these improvements continue and more are created, then Nigerian can escape its third world status and become an emerging economy.

The Nigerian organisation is The Small and Medium Scale Industries Development Agency (SMEDAN).

Opportunities here are opportunities out there to help those looking to break into business venture. Venture capital can be obtained via foundations, trusts, and NGOs. It is just a matter of researching and finding these funding opportunities. Established in December 1999, the Small and Medium Enterprises Equity Investment Scheme (SMEEIS) instructed all Nigeria’s banks to put 10% of their pre-tax profit in order to invest in small and medium sized business of their own. As of 2006, only 26% of this funding had been used. This shows that money is there. Nigeria also has an organization that is similar to the United State’s Small Business Administration (SBA). The Nigerian organization is The Small and Medium Scale Industries Development Agency (SMEDAN). It is very young, but working on providing entrepreneurs with funding. Skills and Ideas Development Initiatives (SKIDI) is an NGO that is helping entrepreneurs realize their dreams in Nigeria so that they can obtain the freedom that they desires within their life. That is both financial freedom and the ability to be with their family. There is a specific focus on rural and suburban Africa, especially since rural areas do see more poverty. The poverty rate in Nigeria in rural areas stood at 40% in 2001. That was compared to the 35% in urban areas where more businesses tend to exist.

How business enterprise helps t is easy to just say that business enterprise is the answer for change in Nigeria, but other than the fact that enterprises is the answer for change in Nigeria, but other than the fact that entrepreneurs are given more freedom, it is important to evaluate other factors. For instance: More tax money flows into the government, allowing for more opportunities to be made available to Nigerians and for more programmes to be implemented that will work on reducing the poverty rate. Jobs are created. In the United States, there are 2 to 3 new jobs created per small business that is opened. It has been determined that the figures are quite similar in Nigeria. More jobs also mean more tax money and spending that stimulates the economy. These are the factors that make any economy operate. Money has to keep flowing in order to keep money in the pockets of citizens.

Vanguard, MONDAY, MAY 5, 2014 — 19

HEN President Goodluck Jonathan agreed for Nigeria to hold a national dialogue on the way forward, many saw it as an avenue to put right what is wrong among the federating units. But Nigerians, who were enthused by the decision, became disillusioned when the composition of the dialogue was made by the ever sleep-walking Secretary to the Government of the Federation, Anyim Pius Anyim. Pius Anyim, compiled a list of the old, the same people that have been a clog in the wheel of progress of the Nigerian nation; men and women whose source of wealth has mainly been from economic rent. Majority of those at the conference under normal circumstance would not make it. They have lived as parasites, sucking their host – Nigeria- dry. They have been stealing the nation’s powers that be. Last week, the resources. Knowing this, they issue raised its ugly head and have vowed never to let states caused another heated debate control their resources. They, at the ongoing national like their sponsors, see conference. The supposed Nigeria as their farm yard. north stood against resource Because oil was found in control and asked that the 13 Nigeria, mineral resources percent given to oil-producing were conferred on the federal state be slashed to five percent. government so that those who Who are these northerners? have access to political power Who do these people speak can expropriate it for their for? Is it the north that has benefit. It is not for the benefit been so very deprived that of Nigerians, but for selfish these self-seeking individuals interest of the few who have are talking about? Where has political access. This group the money they have gotten so has continued to perpetuate far from revenue allocation themselves. been appropriately applied for the benefit of the average he struggle to control the Almajirai? It is when it pleases oil wealth of the nation these rent seekers that they talk has been an issue between the about the north. Can these north and the south. The men look at the global best Nigeria Governors’ Forum practice in a federating state? (NGF) sometime in 2011 Professor Adobe Adedeji, an raised a committee of six, eminent economist, in his headed by Governor Babatude book, ‘Nigerian Federal Fashola of Lagos State, to Finance, Its Development, review the revenue formula Problems and Prospects’, said and submit its that federal finance, in recommendation. The Lagos contrast with unitary finance, helmsman said that the is a triple division of resources committee recommended a between the federal authority, new formula: Federal the regional or state Government (35 percent), the governments, and the local 36 state governments (42 authorities. A study of federal percent) and the 774 local finance therefore involves this governments (23 percent). The triple relationship. But the current revenue formula gives most important characteristics the Federal Government 52 of federal finance are to be percent, states 26.72 percent found in the financial status and the local governments of the ‘intermediate’ political 20.60 percent. The formula entities, the states or regions, was not accepted by the

Economic rent seekers hold down Nigeria’s progress

ach level of government has in the last 50 years or so, depended solely on revenue from sale of crude which is monetized every month and shared in a formula that is somewhat skewed in

incursion of the military into the polity that allocated resources based on its concept of its command structure. In an established federalism, the principles of public finance, particularly of taxation, have received attention from the earliest days of economic analysis. The mercantilist, the physiocrats as well as the classical economists, advanced propositions concerning tax principles. David Ricardo and John Stuart Mills recognised the division of the subjectmatter of public finance into three aspects – revenue, expenditure, and public debt.

at 13 per cent. India, Japan and Indonesia follow with 7 per cent, 4 per cent, and 3 per cent, respectively. China and India account for about 80 per cent of investment expenditures in the Asia and the Pacific region. Russia accounts for 77 per cent of CIS, Brazil for 61 per cent of Latin America and Saudi Arabia for 40 per cent of Western Asia. According to the report: “Under the authority of the United Nations Statistical Commission, the 2011 round of ICP covered 199 economies which is the most extensive effort to measure Purchasing Power Parities (PPPs) across

countries ever.” ICP 2011 estimates benefitted from a number of methodological improvements over past efforts to calculate PPPs. The ICP’s principal outputs are PPPs for 2011 and estimates of PPP-based gross domestic product (GDP) and its major components in aggregate and per capita terms. When converting national economic measures (e.g. GDP), into a common currency, PPPs are a more direct measure of what money can buy than exchange rates. ICP implementation was led

and coordinated by the ICP Global Office, hosted by the World Bank, in partnership with regional agencies overseeing activities in eight geographic regions: Africa, Asia and the Pacific, Commonwealth of Independent States (CIS), Latin America, the Caribbean, Western Asia, Pacific Islands, and the countries of the regular PPP program managed by the Eurostat and OECD). In addition, two “singleton” economies, Georgia and Iran, participated in bilateral exercises with partner economies, without being part of any regional comparisons.

which are designed to perform certain functions which in a unitary system, are assigned to the central authority. The principles of federal finance can therefore be interpreted to mean the principles which these intermediate political entities and the central authorities

Yes in Nigeria, there is revenue, expenditure and debt in public finance. The question is; what are the sources of revenue in public finance in Nigeria? Up till now, about 90 percent of public finance is from oil. What about other natural resources that are said to abound in the country? In every state of the federation, there are large deposits of mineral resources that when developed, can earn the country more money than oil, yet nothing is being done. Is it normal for the control of land across the country to be vested in the governors while the mineral deposits in the same land are in the hands of the federal authority? If you need a mining lease, you take permit from the Federal Government but when you need land to build or develop structures, you obtain Certificate of Ocupancy from the state government. Yet, all this while, these economic rent seekers have not seen anything wrong with this arrangement. Nigeria must begin to operate a true federalism in which tax policy becomes the key fiscal instrument. States must be allowed to develop the resources in their domain and pay tax to maintain the Federal Government. It should not be that every now and then the clamour for a new revenue formula begins to disturb the polity.

favour of the Federal Government. States and local governments in the federation have abandoned their responsibility of generating and developing their internal resources and only depending on the federal allocation for payment of salaries. This aberration arose from the

Nigeria has no defined fiscal structure in states and has not pursued taxation as main revenue source as a result of earnings from oil

should follow in their fiscal operations. The position of local authorities in a federation is not appreciably different from their position in a unitary state, at least so far as finance is concerned. Nigeria has no defined fiscal structure in states and has not pursued taxation as main revenue source as a result of earnings from oil.

Cover Story Continued from page 18 Comoros and Liberia – have a GDP per capita of less than $1,000. Which countries devote the most spending that directly benefit individuals? The World Bank report disclosed that “a general measure of material well-being of each economy’s population is measured better by actual individual consumption per capita. It said that a measure of all expenditures in the economy that directly benefit individuals rather than by GDP per capita is more revealing of the impact

of government policy on individuals. By this measure, the five economies with highest actual individual consumption per capita are Bermuda, United States, Cayman Islands, Hong Kong SAR, China, and Luxembourg, respectively. The world average actual individual consumption per capita is approximately $8,647. Investment expenditures The report further stated that “at 27 per cent, China now has the largest share of the world’s expenditure for investment (gross fixed capital formation); followed by the United States

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20 — Vanguard, MONDAY, MAY 5, 2014

Business & Economy

Unemployment:

Don calls for job commission By SUCCESS UZOKWE

lecturer at the University of A b u j a , Professor Ekhator Eghe, has called on the Federal Government to establish a commission that would checkmate the challenges of unemployed Nigerians and give adequate recommendations. Eghe, who was speaking at a roundtable meeting of the South-South Professional Women Association, SSPWA, in Abuja, stressed the need to employ long and short term measures to tackle unemployment. While delivering a paper entitled, 'Unemployment in Nigeria, Effects on Young Women and the Way Forward' he stated that, though unemployment was a scourge affecting both male and female, women were the worst hit due to lack of education and training. His words; “This commission is to make a comprehensive assessment and submit periodical reports on the employment situation to the Presidents, Governors the States House of Assembly and the National Assembly. “The various short and long term measures of the government have miserably failed to solve the unemployment and underemployment mainly because of high growth rate of population and low level of economic growth rate. However unemployment can be reduced if there is a rapid economic development through the growth of primary, secondary and tertiary sectors. When there is proper coordination between economic planning and employment policy.” Earlier, the representative of the Nigeria Labour Congress, Comrade Francisca Nweke, urged government to address the imbalance between men and women, fight against sexual harassment and rape and promote training and retraining for capacity building of women. C M Y K

FIRS records N140bn shortfall in Q1 revenue collection A

CTING Executive Chairman of the Federal Inland Revenue Services (FIRS), Alhaji Kabir Mashi, has said that the service recorded a shortfall of N140 billion in revenue collection in the first quarter of the year. Speaking at the operational management meeting of its Eastern Region in Owerri on Wednesday, Mashi said the drop in revenue was recorded in the non-oil tax. He said the service realized a total non-oil tax of N418 billion between January and March as against the target of N558 billion. According to him, the non-oil collection dropped from N155 billion in January to N133 billion in February and further down to N130 billion in March. “These results are not impressive and we must do everything possible to ensure that we reverse this negative collection trend,” he said. Mashi said the current focus of the Federal Government was to raise non-oil revenue to the level of making up for any shortfall from oil revenue. He said the service also needed to justify the support it had been getting from the government. He urged the staff to focus on deliberations on service delivery and maximizing the tax revenue potential in their areas of operation. He explained that the programme was based on eight key initiatives which included auditing, arrears and debt

enforcement, tax exemption, evasion of rental taxes and taxing high net worth transactions. Others were registration, filing and utilizing communications as a means of enhancing compliance. Mashi said the service had conducted a nationwide value added tax and withholding tax audits and that the results had started coming in. “We will be proactive in reviewing returns as they come in and following up to ensure

that taxpayers pay up their assessments within the time allowed in our laws. “Thereafter, we will follow up the audit returns without allowing a backlog to pile up,” he said. Earlier in his address, the Coordinating Director of Field Operations Group at the FIRS, Mr Ajayi Bamidele, said the service would strive to collect N700 billion revenue in the second quarter to make up for first quarter ’s poor performance.

He presented the analysis of the non-oil collection report from the six departments of the service, particularly from the Eastern Region and South East Zonal Government Business office. He said that from the analysis, the Eastern Region was top in performance with 62 per cent, with Owerri area operations recording the best performance with 110 per cent. Bamidele said his office had adopted the development of standard check list for field offices to ease response to headquarters, monitoring visits and fast tracking conclusion of audit cases as measures to ensure high performance of staff members.

*FROM LEFT: Dr Sonny Kuku, president, Bank Directors Association of Nigeria (BDAN), Sir Steve Omojafor, Chairman, Zenith Bank Plc, Mustafa Chike Obi, Chief Executive Officer, Asset Management Corporation of Nigeria (AMCON), and Dr, Biodun Adedipe, Chief Consultant, B. Adedipe Associates Limited, at the BDAN Symposium held in Lagos.

Nigerian Content Initiative gets N3bn boost By MICHAEL EBOH

HE Nigerian Content initiative has received a boost as an indigenous firm, Future Concerns Group has invested over N3 billion in the setting up of a service centre for safety and protective equipment used in Nigeria’s oil and gas sector. Speaking at the launch, which featured United States’ safety equipment manufacturer, and MSA Service, the Managing Director/Chief Executive Officer, Future Concern, Mr. Tony Oguike, said the centre is targeted at promoting Federal Government’s local content initiative. According to him, the centre is an intelligent one-stop shop safety resource, featuring best in class brands operating locally within global standards. He noted that the centre is a cost-effective service

programme, adding instant value and practical content to oil sector and other sectors of the economy. “Prior to now, safety and protective equipment, which are high dollar equipment, are used as consumables. They cost about $6,000 each. They were used and thrown away when faulty, thereby leading to loss of hard earned resources. With this centre, MSA will collect these materials, test and repair them for an insignificant amount of money,” he explained. The decision to set up the facility, according to him, is to further its goals of helping to create jobs, empower Nigerian youth and professionals and also to create a healthy and safe work place. He further stated that the company plans to set up a Personal Protective Equipment factory in Lekki. and also delve into the

upstream segment of the oil sector. He declared that the company also plans to deploy robotic high rise cleaning solution, the next generation optimum solution for multistory assets. He said, “It was a natural progression to upgrade our infrastructure operating systems, inventory levels, man hours and all round posture from distributor to current state, service and maintenance resource, ultimately to a manufacturing company, while maintaining a high quality time, costeffective support service for our most valued customers. He noted that the company has a clear vision and mission for its brand, which is to continually upgrade and improve its existing module and operating systems by interactive techniques, learning and understanding global trends and its market place.

“We continue to seek a mutually satisfactory alliance primarily with our esteem clients, our manufacturing partners all over the world and indeed our people, our staff,” he noted. Also speaking, the Managing Director, Sub-Saharan Africa Region, MSA, Mr. Colin Oliver, said the partnership is aimed at promoting Nigerian content in the oil and gas sector. He said the centre will ensure that in the near future, the company will continue to grow its support base in Nigeria, using the opportunities presented by the partnership. He disclosed that ethics and integrity, the core values at the heart of its business were taken into consideration when consummating the partnership, adding that it is important to it to set up a practical and sustainable business base in Nigeria to serve its clients in Nigeria and other parts of the world.

Vanguard, MONDAY, MAY 5, 2014 — 21

Business & Economy

New vehicle transit regime debuts at Seme border By GODWIN ORITSE

OR ease of shipment from country to country, the Nigeria Customs Service has commenced a new vehicle transit regime for automobiles being imported into the country from neighbouring countries like Benin, Cameroon, Chad and Niger Republic beginning with Benin Republic and Seme Border as area of pilot implementation. The new policy which is a fall out of a March 26, 2014 meeting of Directors-General of Customs of the five proximate countries held in Abuja, and in line with the Transit Code, will see all Nigerian bound vehicles imported from the affected countries being handed over to the Nigerian Customs by the country’s customs administration after due clearance. The scheme which has features of accountability, transparency and easy personal evaluation and monitoring will have names of officers responsible for transfers and receipts of manifests/vehicles from both countries . It will also indicate location of formal handing and taking over of imported vehicles on transit Speaking at a ceremony to flag off the scheme, Willy Egbudin, Customs Area Controller of Seme Command, applauded the untiring efforts of the Comptroller-General of Customs, Abdullahi Dikko Inde, CFR for his vision and high level professionalism in bringing the scheme to fruition According to Egbudin, regional security, facilitation of genuine trade and improving on the existing synergies between Nigeria Customs and other customs administrations sharing common borders with the country are expected to be enhanced under the new regime. He added that It will lead to an interstate effort in the fight against smuggling and boost the revenue being generated from vehicle importation into Nigeria. The flag-off ceremony which was conducted by the Nigerian Ambassador to Benin Republic, Ambassador Lawrence Olufemi Obisakin and witnessed by officials of government agencies of Nigeria and Benin as well as stakeholders was ushered in with some fanfare. Obisakin said that the feat is also being achieved because of the fraternal tie between

President Goodluck Ebele Jonathan of Nigeria and his Beninoise counterpart, Yayi Boni has become stronger adding that the bilateral relations can only get better. Obisakin added that the event is not just special but also a great milestone for countries governments, business men and entire citizenry. He said the importance of such an epoch making event cannot be over emphasized as history, according to him was being made. ‘’The official handover of

imported vehicles by the Benin Customs Service to their Nigerian counterpart represents the palpable results of several years of bilateral relations’’ For this we have to thank God for the friendly and fraternal relations existing between President Goodluck Jonathan and his Benin Counterpart, President Boni Yayi as well as the diplomatic and customs services of both countries’’ Obisakin said. Responding to questions from newsmen, the ambassador said

that Seme border is strategic for many reasons including being sited between two commercial capital cities of Cotonou and Lagos, which makes it the busiest land border in West African sub region. ‘’This is a further demonstration of our status as the number one economy in Africa with a drive towards industrialization and reaching to other countries in the sub region through Benin Republic.’’ Obisakin said. Customs at Seme border and Benin Republic will have an important role in getting industrialized goods shipped from Nigeria to other West African countries, the Ambassador added.

From left: Mr.Sunil Kumar, Director, CE, EBT& IT Samsung Electronics West AfricaLtd; Kate Henshaw, Brand Ambassador Samsung; Brovo Kim, MD Samsung Electronics West Africa Ltd and Mr. Parikshir Chandna, Head, Consumer Electronics Samsung at the Samsung Product Launch /media Parley event held in Lagos

Lokoja inland port attains 56% completion - Umar By GODWIN ORITSE

INISTER of Transport, Senator Idris Umar has said that the on going construction of the Lokoja River port is now about 56 per cent completed. Senator Umar who led a team of official of the Federal Ministry of Transport on an inspection visit to the new construction site of the Lokoja in-land River Port, said that the port when completed will further enhance the activities of the newly commissioned Onitsha River port The minister urged the contractor handling the project, Interbau West Africa Limited to hasten the completion of the project in record time. Also at the inspection visit was the Governor of Kogi State, Captain Idris Wada. The Managing Director of Nigerian Inland Waterways Authority (NIWA), Hajia Inna Ciroma took both the Minister and the Governor round the construction site. The minister explained that the construction

of the Lokoja In- land Port and other in-land ports such as Onitsha and Baro would help the utilization of the dredged lower Niger channel in terms of the loading and discharge of cargoes also maintained that economic activities in the country would be seriously stimulated. Senator Umar who expressed satisfaction with the high quality of job executed so far expressed confidence in the contractor, Interbau West Africa Limited whom the minister acknowledged to have done well in the rehabilitation of the Onitsha ultra-modern River Port, and promised to look into the request for the variation of the bill of quantities by the contractor once the request gets to his office. In his own remarks, Kogi State Governor, Captain Idris Wada thanked the Federal Government for constructing the Lokoja Inland River Port which he said would boost trade and commerce not only in his state but the entire country considering the central location of Lokoja.

Outsourcing industry wants 10% govt jobs to boost employment By FRANKLIN ALLI

UTSOURCING companies in Nigeria are asking the Federal Government to delegate ten percent of jobs in the ministries, departments and agencies (MDAs) to them to handle in order to boost employment and growth of the sector in the country. Outsourcing is delegating some of company ’s operations to another company for a fee. Dr. Austin Nweze, President Association of Outsourcing Practitioners of Nigeria, AOPN, disclosed this during an induction and investiture ceremony organised by the association for new members in Lagos. He said that the sector has the potential to turn around the Nigerian economy, citing India as an example, “It was outsourcing that turned around Indian economy. India in 1990/91 was technically declared bankrupt by the World Bank because they had less than 900 million dollars in their foreign reserve but through outsourcing in 1999 during the Y2K bug, India's economy made a big turn around for good. “Some Indians in the Diasporas came in to India and established businesses and companies like Microsoft and General Electric outsourced most of their jobs to India. We all know that some Indians were primary school teachers in this country, some of them had PhD and did all kinds of odd jobs in Nigeria but where are the Indians today? Today, outsourcing has opened the door for India; India is a net exporter of CEOs in the world; most multinationals in the world are run by Indians. Recently, Microsoft has an Indian as its new CEO. It is to show how important outsourcing is to every economy,” he said. He disclosed that currently, member companies employ about 20,000 to 30,000 people and others 15,000 people. “It is a good start because by 2050, the services industry will provide 80 percent of jobs globally. That was a projection from the ITC, International Trade Center."

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22 — Vanguard, MONDAY, MAY 5, 2014

Banking & Finance

NDIC reviews strategic plan to enhance performance

he Nigeria Deposit Insurance Corporation (NDIC) has expressed its determination to continuously review its five-year strategic plan with a view to not only remain relevant in its operating environment but also to effectively discharge its mandate. NDIC’s Managing Director/ Chief Executive Officer, Alhaji Umaru Ibrahim said this in his opening remarks at the NDIC two-day Strategy Review Retreat with the theme: “Repositioning NDIC for Operational Excellence” held at Reiz Continental Hotel, Abuja last weekend. Ibrahim pointed out that the 2011-2015 strategic plan marked a departure from the traditional approach the Corporation adapted in its first strategy in 2007 with the introduction of balanced score card, performance management system, performance-based budgeting and development of early warning system.

Dollar records six weeks high

he dollar rose the most in six weeks against a basket of major peers after a government report showed employers boosted payrolls in April by the largest amount in two years and the jobless rate plunged. The greenback gained to the highest level in almost a month versus the yen as nonfarm payrolls increased 288,000, compared with a forecast of 218,000 in a Bloomberg survey of 94 participants. Emergingmarket currencies dropped on speculation the employment gains will speed the timetable for the Federal Reserve to pare monthly bond-buying and raise interest rates. A measure of market volatility rose from almost a seven-year low. “The numbers look genuinely solid in every respect, so the dollar higher across the board seems like a perfectly reasonable reaction,” Adam Cole, head of Group of 10 currency strategy at Royal Bank of Canada, said by phone from London. “The market is bringing froward its expectations for Fed tightening, or at least has more confidence rates will rise in the U.S., so the dollar is rising as a result.”

Current exchange rate policy portends more risk to economy BY BABAJIDE KOMOLAFE

he exchange rate policy of using the foreign reserves to defend the naira being pursued by the Central Bank of Nigeria (CBN) portends more risk to the economy. Chief Executive Officer, RTC Advisory Services Limited, Mr. Opeyemi Agbaje made this assertion at the Bimonthly Discourse of the Finance Correspondents Association of Nigeria (FICAN) held last week in Lagos. “The risk of the policy we have followed is that it makes it mandatory that one day we would do a massive devaluation that then distorts the economy and cause structural problems”, he said. He advised the incoming Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele to change course and pursue a flexible exchange rate policy “It does not make sensible policy to use the reserve to defend the naira. We are using foreign reserves to create billionaires or millionaires illegally at our own expense. Anytime you do a rate that is different from the market, you are subsidising those who buy dollar because anybody who buys dollars from RDAS is receiving a subsidy of N10 to N15 from the Nigerian government. “Anybody that issues a subsidy should have strategic

From left: Chief Representative, Middle East and African Regional Office, Institute of International Finance (IIF), USA, Mr. Wolfang Engel; Group Managing Director/Chief Executive Officer designate, Skye Bank Plc, Mr.Timothy Oguntayo; Director, Global Events, IIF, Mr. Abdesattar Ouanes; and the Head, Corporate Planning and Strategy, Skye Bank, Mr. Tajudeen Ahmed, during the visit of the IIF team to Skye Bank recently reasons for doing so, but who are we subsidising? We are subsidising the school fees of all the people in schools abroad. We are subsidising the holiday of everybody who chooses to go on holiday, we are subsidising the corruption of anybody who steals money and transfers it abroad. We are subsidising wine and Champaigne, all the consumption we do. Now there is some good element of the subsidy, industries that import raw materials and create jobs or anybody that is importing for otherwise

productive purpose. But what is the proportion of the productive purpose to the total consumption of dollars. So I don’t support the CBN’s determination, as espoused under Sanusi and supported by most Nigerians to protect the naira at the expense of our reserves and at the expense of our common patrimony, because it is collective subsidy to capital flight. It does not make economic sense. “Yes we have achieved inflation at 7 percent, but there is a debate about the

cost. And exchange rate is one of the costs, and the subsidy we provide is one of the costs. “My advice to the incoming central bank governor is to take a little bit of flexibility in relation to the exchange rate even at a cost of a one off inflation pressure. I think we can still keep inflation below 10 percent. I will rather some flexibility in exchange rate and 9.0 percent inflation for instance than depleting reserves perpetually and sending the wrong signal to currency speculators and encouraging moral hazard”.

WAIFEM calls for modern fiscal policy forecasting strategies BY UDEME CLEMENT

he Director General, West African Institute for Financial and Economic Management (WAIFEM), Prof. Akpan Ekpo, has called on finance experts and legislators in Nigeria to embrace modern fiscal policy forecasting strategies, revenue and expenditure models, in order to reposition the nation’s economy for greater growth. He made this assertion in Lagos in his opening remarks, at the one-day validation workshop on fiscal policy forecasting, revenue and expenditure models, organised by WAIFEM for officials of Ministry of Finance and

legislators. He said the workshop is to help legislators and experts in the Ministry of Finance to gather inputs needed for modern day forecasting and revenue models needed to transform the economy. This he said would help to validate and improve on the existing models of forecasting and revenue generation in the country. He said, “The existing models in the Ministry of Finance need adjustment to be on track with global trend necessary for rapid economic development and revenue generation techniques. Forecasting is quite imperative in economic development because it would help the government to tackle the persisting problem of unemployment in the country. Forecasting may not

be exact but would be close to expectations in handling the tasks of growing the economy at a larger scale. We must do our best as economic experts to convince the politicians to look at ways they can move the economy forward” He went on, “The Central Bank of Nigeria (CBN) and National Planning Commission (NPC) have been consistent in putting measures in place to embrace current economic models and forecasting strategies. Other ministries should do the same in order to achieve holistic economic growth and development in all sectors of the economy.” Also speaking, the lead facilitator, Prof. Michael Nyong, from University of Calabar, who made presentation of models on

macro-economics, revenue and forecasting, stressed that Nigeria’s economy needs growth with stability, as well as revenue forecast relevant to tackle fiscal deficit. He said, “The fiscal authorities in the country adopt a strategy of business as usual and capital expenditure that follows a particular historical trend, which is not boosting revenue generation in nonoil sectors of the economy. The authorities should be cautious of the size of the total expenditure while determining capital expenditure to strike a balance in the system. Doing this would enhance development in non-oil export sector, especially in manufacturing.”

Vanguard, MONDAY, MAY 5, 2014 — 23

Banking & Finance BY BABAJIDE KOMOLAFE

he total assets and liabilities of banks in the country fell by N115 billion to N24.29 trillion in February. This represented a 0.5 percent decline when compared with the total assets of N24.41 trillion recorded in January. The decline was however occasioned by 16.1 percent decline in the net foreign assets of banks during the month. Meanwhile banks earned N1.8 billion from deposits kept with the Central Bank of Nigeria (CBN) through the Standing Deposit Facility (SDF). The CBN disclosed this in its monthly economic report for February. The report stated, “Total assets and liabilities of the deposit money banks (DMBs) amounted to N24, 292.8 billion, showing a decline of 0.5 per cent below the level at the end of the preceding month. According to the report the net foreign assets of the banking system fell by 8.3 percent to N7.557 trillion from N8.23 trillion in January. The net foreign assets of the CBN fell by 6.2 percent to N6.07 trillion from N6.47 trillion in January while that of the banks fell by 16.1 percent to N1.49 trillion from N1.77 trillion in January. On the other hand, banks’ lending to the economy rose marginally by 2.2 percent in February. The CBN stated that, “At N12, 343.4 billion, banks’ credit to the domestic

Banks’ total assets fell by N115bn in February

*Earn N1.8bn interest on deposits with CBN

economy rose by 2.2 per cent above the level in the preceding month. The development was attributed to the 2.6 per cent increase in banks’ credit to the private sector, which more than offset the 4.9 per cent fall in banks’ credit to the Federal Government during the review month. “Total specified liquid assets of the Deposit Money Banks (DMBs) stood at N5,945.9

billion. At that level, the liquidity ratio fell by 1.1 percentage point below the level in the preceding month and was 15 percentage points above the stipulated minimum ratio of 30 per cent. The loansto-DMBs’ Credit to the domestic economy rose by 2.2 per cent above the level in the preceding month. Deposit ratio, at 55.5 per cent, was 2.0 percentage points above the level at the end of the

preceding month, but was 24.5 percentage points below the prescribed maximum ratio of 80.0 per cent.” The report also showed that banks deposited N4.953 trillion with the CBN through its Standing Deposit Facility (SDF), earning interest income of N1.8 billion.

AGM - From left: Managing Director/Chief Executive Officer, Enterprise Bank Limited, Mallam Ahmed Kuru, the bank’s Board Chairman, Sir. (Dr.) Ogala Osoka MFR and Company Secretary/Legal Adviser, Mrs. Olufunke Olakunri, during the 2nd Annual General Meeting (AGM) of the bank in Lagos.

Single digit inflation rate unsustainable beyond 2014

financial consultant, Dr. Biodun Adedipe of B. Adedipe Associates Limited has said that the current single digit inflation which hovered between 8.0 percent and 7.8 percent in the first quarter of 2014 is not sustainable because of the expected increased spending that will be occasioned by the 2015 general elections. He stated this while delivering a paper on, ‘The Impact of Asset Management Corporation of Nigeria on the Nigerian economy ’ at a symposium organised by Bank Directors Association of Nigeria in Lagos. According to him, “Throughout 2013, inflation remained single digit, recording its highest level of 9.5 percent in February 2013. In similar trend, inflation from January to March 2014 maintained single digit of 8.0

percent, 7.7 percent 7.8 percent respectively. While this, along with other aggregate statistics, is good for macroeconomic stability of the Nigerian economy, there is likelihood that it may not be sustained to the end of the year and into 2015, as politicians and their parties increase spending towards the State and Federal elections scheduled for 2014 and 2015.” Adedipe also said that devaluation of the nation’s currency, the Naira is unavoidable this year due to persistent pressure on the value of the currency. He said, “Persistent pressure on the value of the naira that began in the fourth quarter of 2013 continued into the first quarter of 2014. Consequently, the premium on the official exchange rate of the Central Bank’s Dutch Auction System (DAS) at the parallel market (Bureau de

BY JONAH NWOKPOKU

Persistent pressure on the value of the naira that began in the fourth quarter of 2013 continued into the first quarter of 2014

Change) has widened to 10.43 percent, which is considerably above the recommended limit of 5.0 percent in the first quarter of 2014 and has become an incentive to round-tripping. “When taken along with the softening external reserves from $43.61 billion at the end of 2013 to $37.9 billion in March 2014; weakening accretion to reserves caused

by oil theft and production losses, unrelenting high import propensity and suspected capital flight which is evidenced by the dampening of the stock market, the high exchange rate premium makes the devaluation of the Naira in 2014 inevitable.” He also noted that, “Increasing debt stock has also become worrisome, especially as it is difficult to tie the mounting debts to specifics in terms of projects and programmes. Total debt stock (external and domestic) as at December 2013 stood at N10.04 trillion ($64.5 billion) of which N1.37 trillion and N8.67 trillion were external and domestic debt respectively. This represents a 21 percent increase from N7.93 trillion ($50.91 billion) in June 2013.”

FCMB records N5.6bn profit in Q1 2014

CMB Group Plc has announced a profit before tax (PBT) of N5.6 billion for the first quarter of 2014. The financial results released by the Group showed that profit before tax rose by 15 percent from N4.8 billion in first quarter of 2013 (Q1 2013). The Group said, “The improved earnings growth in Q1 2014 was in spite of the challenging regulatory environment. Net revenue rose 16 percent to N22.3 billion over prior year, due to growth in earning assets, improved funding cost and the growing contribution of retail banking activities, which compensated for the decline in commissions on turnover (CoT). In the first quarter of 2014, deposits grew nine percent year-on-year to N687.3 billion, aided by 22 percent growth in current and savings accounts, while fixed deposits declined. Consequently, the bank’s funding mix has improved, with current and savings accounts now accounting for 75 percent of total deposits, and resulting in reduction of cost of funds. Loans and advances also grew 50 percent year-on-year to N493.7 billion. This growth was supported by our retail business that witnessed a 90 percent loan growth, from the same period in 2013, to N105.4 billion in Q1 2014.

South Korea's Won leads as Asian currencies appreciate

sian currencies strengthened last week, led by the South Korea's Won’s advance to a five-year high, as data signalled a continued recovery in the region’s economies and on bets U.S. borrowing costs will remain low. South Korea reported its March current-account surplus was the biggest in five months, Taiwan ’s gross domestic product growth beat forecasts and China ’s manufacturing rose in April from the previous month, figures showed this week. The Federal Reserve said April 30 it’s likely to keep the benchmark U.S. interest rate close to zero for a “considerable time” after its stimulus program ends, and a separate report showed the world’s largest economy barely expanded last quarter. C M Y K

24 — Vanguard, MONDAY, MAY 5, 2014

Corporate Finance

Union Bank’s Q1 profit falls by 54% Strong consumer spending, factory data buoy U.S. growth outlook

.S. consumer spending recorded its largest gain in more than 4-1/2 years in March and factory activity accelerated last month, reinforcing views the economy was regaining steam. Economic growth stalled in the first quarter after a very cold and disruptive winter, but the data so far point to a strong secondquarter rebound. “The weakness in growth we saw in the first quarter is not indicative of what is going on in the economy. The fundamentals continue to look pretty good, the economy has momentum,” said Gus Faucher, senior economist at PNC Financial Services Group. Consumer spending increased 0.9 percent in March after rising by 0.5 percent in February, the Commerce Department said. March’s gain was the biggest since August 2009 and beat economists’ expectations for a 0.6 percent rise.

By NKIRUKA NNOROM

nion Bank of Nigeria, UBN Plc, weekend, released its first quarter unaudited financial statement for period ended March 31, 2014 with significant decline in the key performance indicators. The result prepared in accordance with International Financial Reporting Standard, IFRS, requirement, filed with the Nigerian Stock Exchange, NSE, showed 54 percent drop in profit before tax to N5.0 billion from N7.7 billion recorded in corresponding period in 2013. Also, the profit after tax for the period nose-dived by almost the same margin,

declining by 56 percent from N7.8 billion in 2013 to N5.0 billion in the review period. The gross earnings at N26.0 billion, was13.08 percent decrease from N29.4 billion in corresponding period in 2013, while the interest income stood at N20.7 billion as against N18.8 billion in 2014. The bank’s total assets went down to N958.6 billion compared to N997.3 billion reported in the corresponding period in 2013. The total asset position as December 31, 2013 stood at n1 trillion. Cash and cash equivalents was down 29.74 percent to N101.1 billion from N143.9 billion in March 2013, the

customer deposits also declined to N466.4 billion from N482.7 billion, representing … percent decrease. However, the bank’s shareholders’ equity grew to N197.3 billion as against N192.2 billion in December 2013, showing an increase of 2.65 percent. Net loans and advances to customers grew by 29 percent, rising to N220.5 billion from N170.7 billion as at n March 2013. The bank also achieved some level of efficiency in its operations as the operating expenses decreased to N14.7 billion, a 3.29 percent increase over N15.2 billion achieved in first quarter in 2013. The bank said in statement

that it is currently undertaking branch optimization programme, saying that 13 branches are being refit, while another 53 will be completed before the end of the year. It added that previously upgraded branches are already yielding financial upsides and positive Net Promoter Scores (NPS), adding that divestment of four portfolio companies are almost completed and awaiting regulatory approvals. Commenting, Group Managing Director/ Chief Executive of Union Bank, Emeka Emuwa, said: “Union Bank has maintained its profitability and is delivering against key operational metrics supporting our strategy.

WEF: Global Shapers Community host 100 young CEOs By WILLIAM JIMOH

HE Global Shapers Community, GSC, has concluded plans to host over 100 young Chief Executive Officers at the World Economic Forum, WEF, in Abuja next week. Global Shapers Community is a network of hubs developed and led by young people who are exceptional in their potential, their achievements and their drive to make a contribution to their communities. Speaking during a courtesy visit to the Nigerian Stock Exchange, NSE, as part of the company’s activities to create awareness on the initiative, Mr. Yemi Babington-Ashaye, GSC Director, said the 100 young CEOs are coming from different parts of Africa to proffer innovative and sustainable solutions to Education, Entrepreneurship, Technology and Agriculture. “In Africa today, 40 percent of the population is under the age of 15, and also on the continent 70 percent of the population are under the age of 30; there is no way a decision will be made that it will not affect these young ones. C M Y K

From Left: Mr. Rilwan Belo-Osagie, MD/CEO, FSDH Merchant Bank Limited; Mr. Osaro Isokpan, Chairman and Mrs. Oyindamola Ehiwere, Company Secretary at the FSDH Merchant Bank Ltd AGM in Lagos.

Chams records 21.3% increase in turnover By WILLIAM JIMOH

HAMS Plc has recorded N3.44 billion turnover, representing 21.3 percent increase, compared to N2.84 billion recorded in 2012. The company recorded a profit after tax of N188.5 million, 115.3 percent increase, compared to N87.5 million in the last financial year, while its earnings per share improved to seven kobo, more than twice what was posted the previous year. Addressing shareholders at the30th Annual General Meeting, AGM, of the company in Lagos, Mr. Ayodeji Richards, Chairman, Chams Board of Directors, stated that its shareholders funds improved by five percent from N4.5 billion recorded in 2012 to N4.7 billion in the year under

review. Richards, who expressed optimism that the results will be better in the coming year, added that to achieve this level of performance in 2013, Chams embarked on some business initiatives, including; national identity project, payroll automated project for the Osun State and identity management for Anambra State among others. “Chams Plc undertook projects of significant financial import in the local identity management and transaction payments space in 2013. Before now, specifically 2008, your company started committing resources to investment in infrastructure for identity management and transaction payment to make it the market leader in this emerging industry. “The demand for identity management and transaction

payment solutions is likely to continue growing at a Compound Annual Growth Rate, CAGR, of five percent until 2018. The likelihood of demand growth will arise from the ongoing implementation of the Central Bank of Nigeria’s cashlite policy, increasing financial inclusion and digitalisation of commerce, presenting opportunities for technology solution providers in our line of business,” he added. Speaking on why the company did not declare dividend this year, Richards said, “Thank you for your patient so far and we do not want to push that patient so hard; the truth is that we have had challenges in our operations in the past five years, it was a mistake on our own part and we want to own up to that. We concentrated a lot on federal government

business and that was because we hold the national identity card project dearly. “But we have challenges on the project, wanted to do all within our capacity to ensure that the project is successful. As business men, we have done a lot of investment, but waiting for the government to dot the I and cross the T. “Two years ago, we decided that we will have to do things that will enable us to make returns to our shareholders, so we did a restructuring and a repositioning to change our business model. This has started to yield dividend in the last two years. 2009 through 2011 we recorded successive loss, thank God in 2012 we posted a profit and in 2013, it superseded the performance of 2012. With what we have on ground now, they are very good, positive and robust.

Vanguard, MONDAY, MAY 5, 2014 — 25

Corporate Finance

From left: Mrs. Bunmi Akinde, Senior Partner (Advisory); Colin Daley, Partner, Financial Services (Advisory) and Yemi Saka, IT Risk (Advisory) all of Ernst & Young, EY, at the unveiling of EY Latest Report on Consumer Banking in Lagos.

Dangote Cement laments high cost of production, pays N7 dividend

angote Cement Plc has decried the high cost of production, which it explained has resulted to the rise in the price of cement in the country, even as it rewarded shareholders with a dividend of N7.00 per share for the financial year ended December 31, 2013. Speaking at the company’s 5th Annual General Meeting, AGM, in Lagos, the chairman, Alhaji Aliko Dangote, said “ We never

envisaged that the cost of production will rise to this extent when we said that the price of cement will fall , but as you can see, foreign exchange rate has gone up, the same with the price of gas, and diesel . We even constructed some of the roads our vehicles ply, all in a bid to make sure we continue production. We will continue to do our best to ensure that we sell our product moderately; after all, the price of our cement is relatively cheaper when compared to our competitors.

You can now order our product through your computers. We hope to increase our market share in the short term by increasing the level of direct-to customer deliveries and competing on product superiority.” Continuing, he said “Between eight to 10 weeks, our company will pump in nine million tons of cement representing a growth of 45 percent to the market. We want to serve our shareholders by giving you better returns on your investment. Trading remains

robust in the country, and we have experienced a solid start to the year with demand up in all regions. We have embarked on an initiative to improve the standard of cement sold in Nigeria and our belief is that 42.5 strength cement is the most appropriate for general use. We are working closely with industry consumers such as block makers to ensure widespread education as to its use.” Meanwhile, the shareholders who spoke at the AGM commended the Board of Directors and management for the impressive results recorded during the year under review. The shareholders’ association leaders, such as Dr. Farouk Umar, Chief Timothy Adesiyan, Chief Sola Abodurin, Mrs. Bisi Bakare, among others commended Dangote for its contribution towards the growth of the company as well as the economy. According to them, “ Dangote Cement has done well. The company is paying us a dividend of N7.00 per 50 kobo share, an increase of about 133 percent from what it paid last year. The company’s turnover improved from N285 billion to N371 billion in the financial year under review. The same for profitability; it increased from N146 billion in the previous year to N210 billion. So, we are very happy for the performance and hope to get higher dividend come next year.”

Dual listing: UBA Capital pledges support to oil, mining firms international exchanges, Plc, said, “Today’s event is process and enhance By NKIRUKA NNOROM

BA Capital Plc has pledged to support companies in oil & gas and mining sectors that are seeking to raise capital from local and international sources to enable them do so with ease and to also embrace dual listing. The Managing Director, Investment Banking at UBA Capital, Wale Shonibare, made the pledge at a meeting hosted by the company to discuss requirements and the advantages of dual listing for companies in oil & gas and mining industry in three major international stock exchanges - the Johannesburg Stock Exchange (JSE), the London Stock Exchange (LSE), and the Toronto Stock Exchange (TSX) as well as the Nigerian Stock Exchange (NSE). At the meeting were officials of the three major

who highlighted their unique product and service offerings for companies to raise capital and attract listing. Specific requirements for listings were highlighted as well as details of the different country’s regulations with the advantages of dual listings fully enumerated. Speaking at the event, Shonibare said: “UBA Capital Plc is wellpositioned to assist clients achieve their capital raising objectives especially in supporting fast growing mining companies and their oil and gas counterparts to raise the much needed equity capital from local and international sources where such capital might be more easily accessible than in Nigeria due to the specialist knowledge and experience of our investor base in those regions.” Also speaking at the event, Oluwatoyin Sanni, Group CEO, UBA Capital

only one in a series of ongoing initiatives to support the capital raising aspirations of African issuers whilst simultaneously creating attractive and accessible investment opportunities for investors. We shall continue to partner with credible regional and international institutions as we pursue our strategic intent to build Africa ‘s leading integrated financial services group”. Darko Hajdukovic, Senior Manager, Primary Markets from the LSE, disclosed that the LSE has a long experience of listing companies from Africa. The main market of the Exchange currently has 42 listed African companies with total market capitalisation of $239 billion. He observed that the LSE’s experience helps African companies seeking listing to, “de-risk the

their valuation”. Hajdukovic said that London offers a very cost effective option among major stock exchanges. Also speaking at the event, Tamsin Freemantle, Business Development Manager from the JSE disclosed that 86 companies listed on the JSE have dual listings. She also disclosed that the JSE has been able to achieve average market liquidity of between 40 and 50 percent since 2010. Also speaking about the opportunities offered by the Toronto Stock Exchange (TSX), Graham Dallas, Head, Business Development, Europe and Africa, said that the TSX is the number one exchange in the world by the number of listed oil and gas companies as well as listed mining companies.

Flour Mills to boost food security, sufficiency in Nigeria By WILLIAM JIMOH

lour Mill Nigeria Plc, FMN, has intensified its commitment to food sufficiency and security in Nigeria by donating additional N30 million to its food research centre at the University of Ibadan. With the new donation, FMN has committed a total sum of million to the N60 establishment of the Flour Mills Food Research Centre, having made an initial grant of N30 million to the institution last year. Mr. Paul Gbededo, FMN Group Managing Director, who made the donation while receiving a delegate led by University of Ibadan, UI Deputy Vice Chancellor (Academics), Prof. Idowu Olayinka, at FMN’s new Corporate Head Office in Lagos, said the company was delighted to partner with UI in the food research initiative which would help to seek meaningful solutions to postharvest losses in major crops grown in Nigeria and assist sustainability in food production. He disclosed that FMN Group had invested over N220 billion in its agro-allied businesses which extend to large scale cultivation of sugar cane, cassava, corn, soybeans and oil palm in addition to expansion of animal feed production in different parts of the country.

Shareholders to go public with Pimco worries at Allianz AGM

llianz (ALVG.DE) shareholders will publicly press its top executives this week to address the underperformance of its Pimco fund management unit in the hope that the German insurer will look more closely at management problems there. Several top 10 shareholders told Reuters last month they wanted Allianz to step up oversight of Pimco, which is losing billions of dollars in outflows from its flagship bond fund after a public falling out between its founder, Bill Gross, and its co-chief investment officer, Mohamed El-Erian, that caused the latter to quit. Fund manager, Union Investment, Allianz’s 10th largest shareholder, according to Thomson Reuters data, told Reuters on Friday that it had decided to go public with its concerns at Allianz’s annual general meeting in Munich. C M Y K

C M Y K Company Oil and Gas and Products Petroleum Prod ucts Capital Oil Plc 1st fTier Securities AGRICULTURE Crop Production FTN Cocoa Processors Plc Okomu Oil Palm Plc Presco Plc Livestock/Animal Specialities Livestock Feeds Plc CONGLOMERATES Diversified Industries A.G. Levents Nigeria Plc Chellarams Plc John Holt Plc SCOA Nigeria Plc Transnational Corporation UACN Plc

Opening Price (N) 0.50

Daily Stock Market Report Closing Price (N) 0.50

Quantity Traded 100

Year High 0.50

Year Low 0.50

E.P.S.

P.E. Ratio

HEALTHCARE Medical Supplies Morison Industries Plc Healthcare Providers Union Diagnostics & Clinicals Services

0.09

0.50 33.50 40.12

0.50 33.50 39.00

3,000 73,080 2,570,966

0.50 24.58 8.30

0.50 14.53 6.40

0.10 7.33 2.75

50.00 2.77 4.37

3.30

3.14

217,620

0.66

0.48

0.11

15.00

1.56 3.95 1.21 5.06 3.45 56.56

1.60 3.95 1.27 5.06 3.42 57.00

230,571 4,500 1,500 20,454 11,509,710 229,165

2.54 7.60 8.82 8.28 1.82 42.50

1.45 6.43 5.89 5.52 0.50 28.70

0.16 0.31 0.00 0.35 0.24 6.89

5.18 20.74 0.00 15.77 3.64 4.14

CONSTRUCTION/REAL ESTATE Building Construction/Structure ARBICO Plc Constain (WA) Plc

5.30 1.47

5.30 1.50

189 233,345

4 2,720,390.38

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

70.90 8.46

69.42 8.46

391,000 4,750

62.26 8.28

32.96 3.01

24.06

24.52

796,976

20.15

11.59

1.69

7.33

100.00 47.59

200 70

100.00 -

97.00 -

11.75 -

8.51 -

Real Estate Development UACN Property Development Real Estate Investment Trusts Skye Shelter Funds Union Homes Real Estate Investment CONSUMER GOODS Automobile/Auto Parts DN Tyres & Rubber Plc

Opening Price N Sim Capital Alliance Plc Stanbic IBTC Bank Plc UBA Capital Plc

Pharmaceuticals Ekocorp Plc Evans Medical Plc Fidson Healthcare Plc Glaxo Smithkline Consumer Nig May & Baker Nigeria Plc Neimeth International Pharm Nigeria-German Chemicals Plc Pharma-Deko Plc

10.11 2.26

Closing Price N 103.50 23.00 2.14

Quantity Traded

Year High

96,303 4,522,749

103.50 15.69 1.41

Year Low 103.50 10.64 0.03

2.23

785

10.54

9.52

0.00

0.50

4,000

0.50

0.00

3.72 2.46 2.83 69.50 1.78 1.24 7.36 1.57

3.72 2.46 2.75 69.50 1.78 1.18 7.36 1.57

162 65,237 511,505 21,106 471,484 187,975 2,150 100

5.31 1.45 3.20 23.11 5.61 1.96 12.91 200

5.31 0.70 0.83 2.58 3.61 0.95 0.95 4.28

0.19 0.44 2.62 0.20 0.09 0.00 0.00

0.71

31,600

0.52

0.50

0.10

10.00

0.50

2,600

0.50

0.00

12.50

15.99 1.97

16.83 2.07

5,098 360

9.31 3.59

3.25 3.25

0.00 0.01

1.43 0.00

0.50

450,340

50,000

0.50

4,000

1.47

0.50

0.00

16.50 8.75 40.35 8.15 226.01 0.50 1.06 108.50 4.20 1.64 10.00

18.18 8.75 40.35 9.25 226.00 0.50 1.06 108.00 4.10 1.90 11.00

1,613,475 41,962 38,647 819,620 175,581 27,000 16,640 643,596 20 10,000 123,564

30.00 12.57 43.98 15.49 132.51 0.75 3.51 48.05 5.28 3.36 13.40

12.00 8.10 15.16 4.16 95.00 0.50 1.02 36.58 5.11 0.51 10.93

2.14 1.09 2.28 1.47 7.56 0.00 0.00 4.10 0.44 0.23 0.00

7.86 4.97 8.88 2.31 13.17 0.00 0.00 42.86 14.19 2.89 0.00

1.41 2.70

3,125 2,717,101

6.91 3.60

5.94 1.47

0.5 0.25

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

320,000

0.50

0.00

5,232 210,932 299,939 1,015,069 10,000

4.63 255.00 7.10 100.00 1.01

2.23 186.00 5.23 72.50 0.93

0.00 9.95 0.41 5.08 0.00

0.00 19.98 16.29 22.22 0.00

Beverages-Non-Alcoholic 7-UP Bottling Company Plc

90.00

46,512

51.49

,39.00

2.69

13.92

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

Tools and Machinery Nigerian Ropes Plc

7.46

7.85

8.69

8.26

8.08 9.90 68.43 3.69 11.51 0.53

7.78 9.26 68.43 3.69 11.36 0.53

371,074 2,365,902 69,843 315,680 695,276 58,500

19.90 16.20 95.00 6.60 6.70 0.88

4.31 4.02 57.00 2.31 3.80 0.50

0.00 0.91 4.09 0.39 1.01 1.13

16.91 14.38 16.89 16.92 5.75 8.83

NATURAL RESOURCES Chemicals BOC Gases Plc

1,000

9.20

6.80

Food Products-- Diversified Cadbury Nigeria Plc Nestle Nigeria Plc

75.05 1,040.00

71.32 1,072.00

469,911 164,378

37.27 840.10

8.33 400.00

32.27 4.30 1.66

32.27 4.03 1.66

60 75,196 11,000

36.19 5.54 2.88

33.96 2.91 2.88

13.89 0.61 0.00

2.44 7.07 0.00

Personal/Household Products PZ Cussons Nigeria Plc Unilever Nigeria Plc

36.00 47.50

36.00 48.01

138,879 783,540

41.02 47.39

21.02 27.60

0.82 1.44

4.39 32.91

FINANCIAL SERVICES Banking Access Bank Plc Diamond Bank Nigeria Plc Ecobank Transnational Incorporated Fidelity Bank Plc First City Monument Bank Plc Guaranty Trust Bank Plc Skye Bank Plc Sterling Bank Plc UBA Plc Union Bank Nig. Plc Unity Bank Plc Wema Bank Plc Zenith Bank Plc Insurance Carriers, Brokers and Sector African Alliance Insurance AIICO Insurance Plc Continental Reinsurance Plc Cornerstone Insurance Company Consolidated Hallmark Insurance Custodian and Allied Insurance Plc Equity Assurance Plc Goldlink Insurance Plc Great (Nig) Insurance Plc Guinea Insurance Plc International Energy Insurance Plc Investment and Allied Assurance LASACO Assurance Plc Law Union & Rock Insurance Plc Linkage Assurance Plc Mansard Insurance Plc Mutual Benefits Assurance Plc NEM Insurance Co. (Nig) Ltd Niger Insurance Co. Plc OASIS Insurance Plc. Prestige Assurance Co. Plc Regency Alliance Insurance Sovereign Trust Insurance Staco Insurance Plc Standard Alliance Insurance UNIC Insurance Plc Unity Kapital Plc Universal Insurance Plc Wapic Insurance Plc Microfinance Banks Fortis Micro-Finance Bank Plc NPF Micro-Finance Bank Plc Mortgage Carrier, Broker and Sector Abbey Building SOC Aso Savings and Loans Plc Resort Savings & Loans Plc Union Homes Savings Plc Other Financial Institutions Africa Prudential Plc Crusader (Nigeria) Plc Deap Capital Management & Trust Plc FBN Holdings Plc Nigeria Energy Sector Fund Royal Exchange Assurance

8.19 6.06 13.50 1.95 4.75 26.23 3.49 2.20 6.75 9.95 0.50 0.98 22.70 0.50 0.79 0.98 0.50 0.50 2.00 0.50 0.50 0.50 0.50 0.54 0.50 0.50 0.50 0.50 2.31 0.50 0.76 0.50 0.55 0.60 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.72

8.59 6.28 13.00 1.90 4.75 27.15 3.44 2.18 6.88 10.00 0.50 0.98 22.70 0.50 0.77 1.01 0.50 0.50 2.06 0.50 0.50 0.50 0.50 0.53 0.50 0.50 0.50 0.50 2.31 0.50 0.75 0.50 0.55 0.60 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.69

11,871,857 16,222,277 7,678,717 3,011,236 865,336 12,776,386 6,133,583 9,610,699 13,924,448 314,209 3,306,286 1,109,731 40,952,254 100 3,487,075 3,709,700 240,500 150 9,054,578 160,000 93,000 2,750 1,300 220,000 1,670,890 10,500 3,200 151,500 26,000 200 2,185,586 10,000 200,000 5,463 200 200 1,000 30,000 1,000 1,800 2,069 6,143,118

12.39 7.51 14.04 3.47 5.70 26.09 6.50 3.05 7.69 10.60 1.22 1.75 21.49 0.50 1.11 1.03 0.54 0.50 2.44 0.50 0.68 0.50 0.50 0.50 0.50 0.50 0.60 0.50 2.59 0.54 0.81 0.61 0.50 1.01 0.50 0.56 0.50 0.50 0.50 0.50 0.50 1.08

4.70 1.92 9.90 1.13 2.90 13.02 2.65 0.80 1.64 2.34 0.50 0.52 11.96 0.50 0.50 0.58 0.50 0.50 1.08 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 1.06 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50

1.42 0.90 2.81 0.43 0.00 2.10 0.71 0.54 0.67 0.00 0.00 1.34 2.09 0.00 0.50 0.14 0.02 0.50 0.28 0.01 0.00 0.03 0.01 0.00 0.02 0.00 0.00 0.03 0.16 0.00 0.37 0.02 0.03 0.06 0.04 0.09 0.00 0.00 0.00 0.02 0.00 0.07

8.73 8.34 5.00 7.93 0.00 12.39 9.15 5.43 11.19 0.00 0.00 0.43 10.24 0.00 22.20 6.79 27.30 10.00 7.43 50.00 0.00 16.67 50.00 0.00 25.00 0.00 0.00 16.67 16.19 0.00 2.19 26.00 16.67 15.50 12.50 5.65 0.00 0.00 0.00 25.00 0.00 15.43

6.27 0.81

6.27 0.85

1,000 146,700

6.00 1.18

0.00 0.92

0.04 0.92

150.00 10.56

1.35 0.50 0.50 0.50

500 200 20 262

1.57 0.50 0.50 0.50

1.37 0.50 0.50 0.50

0.19 0.02 0.00 0.00

47.6 7 25.00 0.00 0.00

3.04 0.50 0.99 14.16 552.20 0.62

3.00 0.50 0.99 13.80 552.20 0.59

1,811,253 22,000 500 33,061,614 212,000

0.75 0.50 2.02 20.00 250 0.78

0.00 0.50 2.02 8.57 552.20 0.50

0.19 0.00 0.00 2.03 12.68 0.13

9.16 0.00 0.00 9.85 43.55 6.00

9.05 14.13 0.00 0.00

0.71

0.50

Household Durables Nigerian Enamelware Plc Vitafoam Nig. Plc Vono Products Plc

88.50 0.00 3.07

Computers and Peripherals Omatek Ventures Plc

13.79 170.50 26.00 151.00 0.77

27.61 32.84

9.71 18.03 6.71

1.91

0.50

1.35 25.43

P.E Ratio

0.50

13.79 176.00 26.00 150.00 0.77

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

E.P.S 10.56 0.87 0.21

ICT Computer Based Systems Courteville Investment Plc

IT Services NCR (Nig) Plc Tripple Gee and Company Plc Processing Systems Chams Plc 4.11 4.73

103.50 23.00 2.25

as at Friday, May 2, 2014

Packaging/Containers Avon Crowncaps & Container Nigerian Bags Manufacturing Company

1.47 2.74

0.00

6.47

6.66

Metals Aluminium Extrusion Ind Plc

10.50

12.39

10.70

0.13

85.77

Non-Metalic Mineral Mining Multiverse Plc

0.50

3,730

0.50

0.01

0.00

Paper/Forest Products Thomas Wyatt Nig. Plc

0.79

1,000

1.38

0.00

Electronic and Electrical Products Cutix Plc Nigerian Wire & Cable Plc

1.90 0.50

1.85 0.50

131,153 10,000

2.50 2.58

1.62 2.58

0.11 0.00

13.15 0.00

1.44

2,000

1.51

1.33

0.03

28.80

3.98 18.97

6,888 183,530

3.98 15.58

3.98 12.71

0.00 3.90

0.00 3.26

4.30 1.05 2.92 0.63

4.30 1.05 2.78 0.66

29,198 200 84,311 2,749,340

4.30 1.86 2.92 0.63

3.60 1.05 2.92 0.63

1.22 0.30 0.07 0.00

3.52 6.18 41.71 0.00

Mortgage Carriers, Brokers and Se Abbey Building Society Plc INDUSTRIAL GOODS Packaging/Containers Abplast Products Plc Beta Glass Co. Plc Nampak Nigeria Plc Poly Products (Nig) Plc Studio Press (Nig) Plc W.A. Glass Ind. Plc

0.78

39.60 9.16

7.37

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

0.50

2,123,349

0.97

0.87

0.19

6.06

Intergrated Oil and Gas Services Oando Plc

16.00

15.90

1,653,739

78.97

27.99

1.73

4.17

20.50 0.50 49.20 148.99 118.22 51.72 161.20

20.50 0.50 49.20 148.99 115.00 51.72 153.14

82,191 463 30,100 327,651 61,315 1,219 32,566

37.10 0.70 5.59

0.50 0.50 3.89

4.93 0.00 0.61

7.40 0.00 6.99

163.50 2,100 240.00

141.00 63.86 195.50

6.11 2.98 14.63

11.11 19.23 17.07

0.50

200

0.50

Petroleum and Petroleum Products African Petroleum Plc Beco Petroleum Plc Conoil Forte Oil Nig Plc Mobil Oil Nigeria Plc MRS Oil Nigeria Plc Total Nigeria Plc Hospitality Tantalisers Plc SERVICES Afromedia Plc Automobile/Auto Part Retailers RT Briscoe Plc Courier/Freight/Delivery Red Star Express Plc Trans-National Employment Solutions C & I LEASING PLC Hotels/Lodging Capital Hotel Ikeja Hotel Plc

0.01

0.50

0.72

1.19

1.14

1,160,441

3.65

1.30

0.21

8.19

4.16

4.16 2.13

12,100 2.47

3.67 62

2.65 0.25

0.60 11.12

4.91

0.50

26,000

1.64

4.55 0.63

1,000 43,640

400 2.07

0.50 4.55 0.63

0.51

0.90 3.00 1.33

0.00

0.04 0.34 0.92

12.75

11.25 34.09 2.12

Media/Entertainment Daar Communications Plc

0.50

10,000

0.50

0.48

0.00

Printing & Publishing. Academy Press Plc Learn Africa Plc Studio Press Nig. Plc University Press

1.80 1.61 2.40 4.00

1.80 1.66 2.40 3.80

1,000 1,028,913 1,080 308,841

3.68

0.25

12.19

0.00 6.82

3.17 0.30 0.00 3.60

0.54

27.69

Road Transportation Associated Bus Company Plc

0.82

0.80

824,000

0.80

0.50

0.00

Speciality Interlinked Technologies Plc

4.90

1,995

5.15

4.90

0.00

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

2.14 4.60

2.14 4.56

38,807 1,111,782

2.78 11.75

1.57 6.50

0.60 12.53

4.22 8.75

26 â&#x20AC;&#x201D;Vanguard, MONDAY, MAY 5, 2014

Capital Market

Vanguard, MONDAY, MAY 5, 2014 — 27

Commodity index April 25- May

Micro Finance

Skills acquisition key to successful entrepreneurship Stories by PROVIDENCE OBUH

XFORD and Cambridge Club of Nigeria has identified skill acquisition as a key to becoming a successful entrepreneur in a competitive market like Nigeria. Speaking at a business forum in Lagos, Chief Executive Officer, Eventful Limited, Mrs. Yewande Zaccheaus, said that entrepreneurs must be capable of recognising opportunities around them, while finding internal inspiration to solving problems.

She advised future entrepreneurs to think outside the box, have passion for what they do and embrace risks. He said, “To become a successful business owner in a competitive market like Nigeria, I urge our upcoming entrepreneurs to acquire education and adequate experiences before going into business. Meanwhile, the Minister of Trade and Investment, Dr. Olusegun Aganga is expected to grace the Oxbridge Business Forum in Abuja by May this year, while Governor of Lagos State, Babatunde Raji Fashola (SAN), will be the guest speaker at the club’s Spring Lecture 2014.

From left: Mark Hedderwick, Director UAC Restaurants Limited, Darren Hele, CEO Famous Brands, Larry Ettah, Group Managing Director, UAC of Nigeria Plc, Derrick Van Houten Managing Director, UAC Restaurants, during the 2014 UAC Restaurants Franchise Conference in Lagos.

Total unveils Mr Safety initiative I

N commemoration of the World safety at work day, Total Nigeria Plc has launched an initiative called “Mr Safety” to address anticipated anomalies in it's stations nationwide. The company also reiterated its commitment to better service delivery, in line with the initiative backed with a Mr Safety Reflective Jacket. Safety at work day is a day set aside every year to promote the prevention of occupational accidents and diseases at work sites. Speaking at the world safety at work day/launch of mr safety, held in Ijora service station, Lagos, Managing Director, Total, Mr. Alexis Vovx, said that the programme is an awareness raising campaign intended to refocus attention on the need for best practices in all operations with particular attention on its occupation safety and health. Tagged “Speak Up,” Vovx said that this year’s theme is a call to the realisation that there are so many unsafe situations in trying to play safe around the work place, saying, “We encourage everyone to speak out. We must desire to give a sense of responsibility to every individual in the company and emphasize personal values to the safety of our organisation through the assurance of a safer work place for all

staff/dealers/customers and neighbours . Safety is everyone’s business and we all must be totally committed to it. “To reduce probability of accident in our work places is important that every employee report all unsafe issues observed in their work place and by doing that we can educate and ensure safety.” He explained that mr safety will be devoted to feedbacks on anomalies, near misses, enforcing good practices. According to him, “We recognise safety through the reflective jacket and we are observing it in all our service centres. “The implementation of mr safety in our service stations is fully in line with directive we received and this will be the pillar of the safety culture in the station, he (mr safety) will also be the one devoted to the objective of safety control during the service-station operations. “We don’t have much accident, our major safety risk is on transportation but today we have safety measures in all our station and depots. Sometimes there might be attacks, but we have a programme where we train customer attendant on how to deal with every customer and how to prevent fire with extinguishers,” he said.

C M Y K

28 —Vanguard, MONDAY, MAY 5, 2014

Interview

I’ve started implementing the aviation road map — Ortom The recent removal of the Minister of Aviation, Princess Stella Oduah saw the appointment of Chief Samuel Ortom as the supervising Minister for Aviation. Chief Ortom fielded questions from Aviation reporters on the recent developments in the aviation sector especially the recent recommendation by the Steve Oronsanye panel that some aviation parastatals should be merged. Excerpts: By LAWANI MIKAIRU

ince the removal of former minister of Aviation on 12th of February, 2014, you’ve held sway as the supervising minister of aviation, how has the experience been considering the crisis that rocked the industry before you came in? Mine is to hold the ministry and ensure everything is working perfectly until a substantive minister is appointed. That is the much I’m doing and the experience has been fine though, challenging. The aviation ministry is critical to our national progress thus; it must be handled with great care. My brief is to see to the progress of the aviation sector as a supervising minister so there wouldn’t be a lull. The US Federal Aviation Authority just audited our aviation industry as a critical process for us to maintain our Category One status. That process went on smoothly despite not having a substantive minister and we are hopeful we will retain our Category One status as we met majority of the critical areas assessed.

Are you saying there is no lull in the industry following Oduah’s exit considering that you are a supervisory minister? Being a supervisory minister doesn’t make me less effective. I have the mandate of the President to ensure the ministry works and that is what I’m doing. I have already started by continuing the implementation of the aviation roadmap because it is part of the transformation agenda of Mr. President and approved by the Federal Executive Council (FEC), which I’m a part of. The aviation roadmap as you are aware, is a comprehensive blueprint on how to transform the Nigerian aviation industry into a modern, viable, profitable and sustainable one. The roadmap gave birth to the upgrade of all 22 federal airports, building of five brand new modern international terminals to be located in Lagos, Abuja, Kano, Port Harcourt and Enugu. Works on the terminals have started and would be completed by 2015. The roadmap also defined the future of perishable cargo terminal in Nigeria. Already, 16 of those terminals are under construction and most of them, if not all, should be commissioned by 2015. The roadmap also talked about the concept of aerotropolis — a concept

•Chief Samuel Ortom

that would turn airports in Lagos, Abuja, Kano and Port Harcourt into business hubs offering world class services in travel/tourism, entertainment, commerce/ industry and lots more. Recall that our aviation industry was in total neglect for over three decades. Most of the infrastructure were dilapidated and the quality of services was just as poor. Safety standards were a source of worry. Even the standard of training at the Aviation college had reduced remarkably. But when President Goodluck Jonathan came, he made the aviation industry a critical component in his transformation programme.

He had to do that because a nation with a poor transport industry, especially the aviation sector, can’t really progress; the nation can’t also optimize its full potentials. This thought process gave birth to the approval by the president of massive upgrade of infrastructure in the aviation sector. It also gave impetus to the upgrade of service delivery by government agencies in the aviation sector comparable to other parts of the world and most importantly, the raising of safety standards in the industry. Safety is critical because as the pilots would say, there is no parking space in the air. So one safety snag can cause

unimaginable consequences thus, we take safety critical in the sector. Safety is critical to me and I will never compromise on it. We are also committed to growing the sector to a profitable one. Recently, the GDP was rebased and Nigeria’s economy is now worth $510 billion, the largest in Africa and 26th globally. Good news but how much did aviation contribute to that figure, about N200 billion annually but the industry can contribute over N500 billion to the GDP annually if developed further. This is our target in 2015 perhaps by 2020, the aviation sector should be contributing N1 trillion annually to the nation’s economy annually and support well over 500,000 direct and indirect jobs. The future indeed for the industry is bright, I can tell. Talking about the rebased GDP

Vanguard, MONDAY, MAY 5, 2014 — 29

Interview that would hurt the aviation industry. The government considers the aviation industry very critical to transforming the economy, thus it wouldn’t jeopardize that with aviation-hurting policies. Let’s trust the government to do what is right. This government is a listening one, if at any point the government considers the merger detrimental, it wouldn’t hesitate to rescind its decision.

This government welcomes private investors in the sector and we are ready to support them in whatever way possible.

and the aviation industry, what does it have in store for us? The rebased GDP is positive for Nigeria. But like the Coordinating minister of the economy, Dr. Ngozi Okonjo-Iweala has explained, the rebased GDP doesn’t mean we don’t have economic challenges that must be addressed and should be addressed. The new GDP only gives us a better picture of the size of our economy and how the various components are contributing to the growth trajectory. This is significant because it would allow the various components of the economy to compete in terms of value addition. For instance, the aviation sector can better appreciate its value and retool its economic offering for better profitability. Yes, we have challenges as a

nation but let’s celebrate our little successes wherever they occur. Also, with the rebased GDP, Nigeria can market herself better. For instance, if I’m selling the aviation sector to local and international investors, I can convincingly explain how their investments can be profitable because the Nigerian economy is on the growth trajectory. There is just no way other sectors of the economy would grow in isolation of the aviation sector. It’s just not possible. People must travel to transact certain businesses as not all deals can be fixed via emails or telephones. You must also travel for tourism and other social engagements. Thus, with more economic prosperity, it goes without saying that the aviation sector would boom as well. I also make bold to say, as more foreign investors are attracted to Nigeria because of the new size of the economy, some would invest in aviation. In fact, we are already positioning to benefit from these investors hence the infrastructure upgrade at the airports and other infrastructure we are building across the country.

hese airports under construction, when will they be completed and commissioned? We are hoping they would all be ready by 2015, all things being equal. Besides the five brand new international terminals, just about 15, out of the 22 are still being done. In fact, out of these 15, five are almost ready for commissioning and the remaining 10 may be ready before December or thereabouts. Work is in progress on the airports and the 14 cargo terminals. I have started inspecting the progress of work done and the facilities across the airports to ensure the

•Chief Samuel Ortom...The government considers the aviation industry very critical to transforming the economy, thus it wouldn’t jeopardize it with aviation-hurting policies airports are delivered on time and to specification. So far, I have visited Enugu and Owerri. I also visited Kaduna and Abuja. I will also be visiting Lagos and some other states where we have projects ongoing in the coming weeks. We are not leaving anything to chance. The immediate past minister had said, there will be no abandoned project in aviation sector. I can also assure that, there will be no abandoned project in the aviation industry. I’m not the type to abandon laudable projects of my predecessors because the projects are for the benefit of Nigerians and not for the individual minister. My children will benefit from the system tomorrow, just like your children and every other Nigerian. We are building an enduring culture and a system that works irrespective of who is the minister. We must learn to build institutions, not individuals.

hat about safety and security? Security and safety of our airports are very important to us. In all the airports that are being done, safety is a critical component. You may not get to see the safety infrastructure but it’s there. I may not be obliged to tell you all of our safety and security procedure for security reasons, but I can assure you it is robust. However, you would agree that we’ve moved from a tradition of one full body scanner at our airports to two scanners now in Lagos alone. In Murtala Muhammad Airport, Lagos we also have five screening machines that detect metals, explosives and other

banned substances. We have several metal detectors in the other airports and other security infrastructure. Don’t forget, we are coming from decades of decayed and neglected industry, fixing it won’t be a tea party. It is a painstaking process and it will take time too. I think Nigerians should be a little patient with us. Yes, we may not have met all expectations, but we can only do better. Our target is to ensure international best practices.

ecently, the FG issued a white paper on the Steve Oronsaye Committee which recommended that NiMET, NCAA and NAMA be merged into one. The FG approved the recommendation. Aviation stakeholders have condemned the approval arguing that it would be a bad precedent in the industry and Nigeria may risk sanctions from ICAO. Is government worried about these concerns? The Steve Oronsaye Committee, I believe, considered all options and consulted widely with the relevant stakeholders even in the aviation industry before making the recommendations. Government has also looked critically at the proposal and considered it in the interest of the sector to approve the proposal. The merger, I believe, will improve efficiency and reduce waste and overhead cost in the aviation sector. However, the President has set up an implementation committee to see to the merger process. I don’t believe the government would go all out to implement policies

Any challenges so far sir? You call them challenges, I call them opportunities to make a difference in the sector. In whatever I do, I strive for excellence so I can leave a place better than I met it. So, whatever it is that is lacking in terms of infrastructure is an opportunity, even for private investors to step in and fill the gap. This government welcomes private investors in the sector and we are ready to support them in whatever way possible. But some critics say, this government isn’t investorfriendly. How can you correct this impression? That is far from the truth. Recall in February, just before the immediate past minister left the cabinet, she held stakeholders' and investors' meeting at Oriental Hotel in Lagos. The engagement was heavy and it lasted for about a week. During the engagements, including the buy-in for staff of the aviation industry, the minister and heads of all the aviation agencies took time to explain the vision of the industry, the investment areas in the industry and the opportunities that lay ahead for staff and the private sector. Will a government which is anti- investor do all those? No. During those intensive engagements, discussion lines on investments areas were opened and we are continuing engagements on that. I maintain, and you can take this to the bank, we are investor-friendly and no rational mind can discredit our sincerity of purpose. There are several investment areas that have been developed and are still being developed like airport facility management, dutyfree development, shopping malls at the terminals, restaurants, perishable cargo processing facilities at the perishable cargo terminals, new airlines etc. The opportunities for the private sector players are almost limitless. I will welcome all investors and so will Mr. President.

30 — Vanguard, MONDAY, MAY 5, 2014

Homes & Housing Finance

ARM unveils Nigeria’s first golf estate

IGERIA’s asset management group, Assets & Resource Management Company Limited, ARM, has unveiled its iconic Lakowe Lakes on May 1, 2014. The Lagos New town development project has been modeled after other globally successful urban development projects. With the plan to fully integrate a self sustaining municipality that will incorporate first class infrastructure, Lakowe Lakes Golf and Country Estate, a 308 Hectare development overlooking a 55 hectare manmade lake is designed as an exclusive, secure and serene haven to provide a new destination, high-end residential neighborhood located on the Lekki-Epe Axis, some 25 minutes outside the bustling city of Lagos. It features a pristine 18-hole beautifully manicured golf course designed by PGA Professional and golf course architect, Robert O’Friel, with a complete clubhouse that affords a luxury and secured gated community with other sports facilities such as a swimming pool, squash, tennis and badminton courts.

FG to tackle house racketeering with biometrics *To deliver 10,000 units by year end Stories by YINKA KOLAWOLE, with agency report

HE Federal Government is set to employ the use of biometric technology to tackle house racketeering, whereby the rich and influential buy up houses built by government and re-sell at exorbitant prices to the less privileged. Minister of Lands, Housing and Urban Development, Mrs.

Akon Eyakenyi, disclosed this during an inspection tour of the ministry’s prototype housing scheme in Suleja, Niger State. She said government will deploy the technology to curb sharp practices in the allocation of houses, expressing optimism that the strategy will lead to significant reduction the housing challenges confronting majority of Nigerians. “We are trying to put up a system where we will ensure that no more than one

person will have access to one unit so that it can spread to all persons. I want to guarantee Nigerians that under this dispensation, an individual will be entitled to only one house,” she stated. The minister noted that the 102-unit housing estate, made up of 3 units of three bedrooms, 44 units of two bedrooms and 32 units of one bedroom apartments, are being developed under the Public Private Partnership (PPP)

UK mortgage approvals slide further

ORTGAGE approvals in the UK fell again in March, according to the latest figures from the Bank of England. The number of mortgages approved in March fell to 67,135, down from 69,592 in February. The February figure was itself lower than January ’s. Mortgage approvals have now fallen by 11.9 percent in the past two months. The figures, which are the lowest since October 2013, came as some surprise to experts. They will also support those who argue that the UK is not in a housing bubble, as they show mortgage offers are running at half the level they were during the last housing boom. Approvals peaked at 133,000 a month in November 2003. One possible explanation for the fall in lending is that banks and building societies may have tightened up on lending procedures even before the Mortgage Market Review (MMR) rules came in at the end of April. Under MMR, lenders have to scrutinise borrowers more closely, to check they can afford the loan in question. C M Y K

•Private estate development

scheme. Eyakenyi explained that the three-bedroom apartments would be allocated to contributors to the National Housing Fund (NHF) for N5.8 million, while the two-bedroom and one-bedroom houses are to cost N4.7 million and 1.8 million respectively. In a related development, the housing minister said the federal government, in collaboration with the private sector, is expected to deliver about 10, 000 housing units to Nigerians before the end of the year. Speaking at an event recently in Abuja, she stated: “In February, the President launched the Nigeria Mortgage Refinance Company (NMRC) Scheme and as we speak, we have about 14 states that have indicated interest to be a part of this scheme. We’re all aware that housing is a major problem and it’s absurd that people work 35 years and at retirement still live in rented accommodation. Arrangements are in progress and in the next two months, they will start up the project and before the end of this year, 10, 000 housing units will be delivered to Nigerians. “Other than the government’s contribution in the housing sector, we are also negotiating with developers on a public private partnership approach where the government will give land and you will have the developer and mortgage bank come in so that it will help Nigerians and civil servants to acquire it and it will become their own.”

Resort Savings intensifies effort on affordable housing R

ESORT savings and loans (RSL) Plc says it plans to intensify efforts to ensure more Nigerians have access to affordable housing. Managing Director/Chief Executive Officer of the mortgage bank, Mr. Abimbola Olayinka, in a statement, confirmed that the bank has been able to bridge the gap in the housing deficit nationwide a little by creating over 4,000 housing units in recent times. He said there are plans by the bank to further improve on this in order to put smiles on the faces of more Nigerian families. Olayinka said RSL, in the first half of 2014, plans to make available over 2,753 housing units in the Lagos and Ogun

States axis through mortgages. These, according to him, include the current development of the Resort Estate Ofada, with over 400 housing units, tastefully finished 2 and 3 bedroom terrace bungalows, which Nigerians will be able to access at affordable prices. He added that work is also ongoing at the Resort Pearl Garden in Sangotedo, which will have at least 80 housing units. The RSL boss stated further that in the bank’s bid to strengthen its position in the housing sector, it is partnering with a lot of developers in either financing their projects or providing mortgage facilities to the off-takers at affordable interest rates.

Giving an insight into the existing and on-going projects and partnership with developers, Olayinka added: “Some of these estates include the Teju Royal Garden Estate in Okokomaiko, which has over 600 housing units of one and two bedroom terrace bungalow, three bedrooms semi-detached and three bedrooms fully detached bungalows. Apart from the accessibility of the estate due to the current development of the Lagos-Badagry Express Road as well as the proposed Rail track to link Marina Lagos end, the price of the houses are very affordable.” He said other projects that the bank is involved in include: Dreamville Estate, Owode – Ibese road, Ikorodu, which has over 120 housing units in various stages of development;

Dabis Royal Estate off Allen Avenue, Ikeja; South-drift in Lekki; Gracious Gardens, among others. Other ongoing projects in the other parts of the country, according to him, are: Jedo Mass Housing Estate, in Ushafa Bwari area council, with over 1,000 housing units under construction; Mahfas Sunshine Estate, Kurudu, Abuja, with over 500 housing units completed and over 1,000 units in various stages of completion. Others are Resort Court, Karu; Kubusa Gardens Estate; Orchards Estate, Lokogoma; Von Garden City Estate and; Shelter view, Maraba in Abuja. The intention, according to Olayinka, is for Resort Savings to create at least 5,000 housing units in Abuja and its environs through mortgage creation.

Vanguard, MONDAY, MAY 5, 2014 — 31

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32 â&#x20AC;&#x201D; Vanguard, MONDAY, MAY 5, 2014

People in Business

r. Degri Emmanuel is the M a n a g i n g Director/Chief Executive Officer of Treasure House Entertainment, a film production outfit based in Jos, Plateau State. In this chat with Vanguard recently, the graduate of Theatre Arts from the University of Jos says insecurity has greatly affected the business. Excerpts: According to Degri Emmanuel, Treasure House Entertainment came into being in 2005, offering skeletal services but went into full operation in 2011. "We have done a lot of productions that are performed before dignitaries, productions geared towards political issues, productions that treat the present insecurity issue in Nigeria; productions that deal with matters bothering Nigeria," he said. Before setting out on his own, Degri had worked with Jos Repertory Theatre and says that the owner of the theatre, Mr. Patrick-Jude Oteh, contributed to what he has become today. A man of many parts, Degri says apart from acting and producing films, he also

Insecurity, funds, Nollywood affecting our business â&#x20AC;&#x201D; Degri Emmanuel consults for the hospitality industry, trains students on production, and sings, with two albums to his credit. "My specialty majorly is directing though I also act. I have participated in a few films such as The Heir, showing right now on STV and other stations; I have also featured on Amstel Box Office, AMBO production entitled Cyndy's Notes. Theatre, I would say, is my life; I have been able to participate in over 50 plays. I have participated in and also directed plays such as Prof. Wole Soyinka's The King's Horseman, Ola Rotimi's The Lion and the Jewel and an adaptation of the all-time prose written by the late Prof. Chinua Achebe, Things Fall Apart in which I played the role of Okonkwo. I have been able to play major roles because I have passion for what I do. "I don't know what else I

*Mr. Degri Emmanuel ...I don't know what else I would do if not theatre. would do if not theatre. Theatre arts has been a better part of my life. I have consulted f o r Nasarawa S t a t e Troupe for over four years and we have always been able to take the gold medals," he said. In 2005, while still with the Jos Repertory Theatre, he had the privilege of travelling outside the country. "We did a job with the B r i t i s h Council. So we were in the UK for two weeks staging a play we wrote called Our House. And then a theatre g r o u p based in Glasgow, Scotland, also came here and did a production," he stated. HIV/AIDS epidemic: "I have been a part

of a production that championed the whole aspect of HIV/AIDS epidemic in the early days. Ford Foundation funded us to do that under the Jos Repertory Theatre, the same way the National Agency for the Control of AIDS, NACA, did on HIV/ AIDS and drug abuse, we did all that. I just completed a movie production titled Legal Clinic, a job by Sound City." Challenges: On the challenges facing the business in Nigeria, Degri says apart from paucity of

BY EBELE ORAKPO

Overseas, actors don't need to shout because they have clip and lapel microphones so they just talk in a relaxed mood and you hear them; but here, you need to shout; you have to raise your voice because you don't have the equipment and the money to buy them

funds, insecurity and the advent of Nollywood, also pose a great challenge to the business. Funds: "Because Treasure House Entertainment is majorly focused on stage productions,(although we are trying to do a film on Hepatitis B and sickle cell anaemia, everything is ready except funds),and that takes me to what actually is the challenge - funds. It's either you don't have enough funds to do a quality production; when I say quality production, it is not quality in acting. You see, overseas, actors don't need to shout because they have clip and lapel microphones so they just talk in a relaxed mood and you hear them; but here, you need to shout. You have to raise your voice because you don't have the equipment and the money to buy them. One of my mentors has been Tyler Perry. He first started from stage productions and then later put them together and mass-dubbed them and people are watching them like a film now and that is because it is of high quality and you will not be able to tell the difference between stage and film- good lighting, good sound, good everything but we don't have that here." Insecurity: "People no longer come out to watch stage productions. If you want to get light effects, who wants to come and sit and watch production from 7.00pm till 9.00pm in a place like Jos or in most parts of the north? In Plateau State for instance, by 9.00 - 10.00pm, everybody wants to be home. Although peace has returned relatively but nobody wants to be out at night." Nollywood: "Also the advent of Nollywood is a major challenge. People prefer to watch movies in their houses. Live performance, for me, has been the best, it is electrifying, it's fun! I act on live stage and it is not a problem switching from stage to film. But here, every Tom, Dick and Harry gets on the film and wants to act whether they read theatre arts/ film or not. I think abroad, I stand to be corrected, everyone goes through the rudiments of drama and then they become film actors and that is why they are best at what they do but here, we do not have that culture," he said. The outfit which he started from his home, has two employees. Says Degri: "It is a gradual process; we might not be a household name yet but in Jos City and parts of Abuja, if you ask of Degri Emmanuel, it is a known name so we appreciate God for what He is doing. We are just taking one step at a time. Little, little drops of water will be a mighty ocean very soon," he enthused.

Vanguard, MONDAY, MAY 5, 2014 — 33

he report by Simon Ejembi went on to disclose that “the Banking Index fell by 16 per cent in the first quarter of this year; more than any sectoral indices, in what some analysts say is the worst performance by the Exchange in 10 years.” Those who might find this result startling, especially those who lost some money on account of this report, have themselves to blame. I certainly was not surprised because I had expected it. In the first week of November 2013, I had warned our readers, in my SUNDAY VANGUARD column, FRANKLY SPEAKING, to be prepared for another round of losses on the Nigerian Stock Exchange in 2014. And leading by example, I had called on my Stockbrokers to offload some shares – mostly bank shares. It was a wise decision and it will become wiser as we move into 2014. Banks and their shares are, once again poised to take a beating on the Exchange. April had been just as turbulent as any month since the year started. The reports by listed companies, which

Revisiting the Nigerian Stock Exchange —1 had excellent 2013 had been released. That has had the effect of pushing up share prices. There has also been a new listing which increased the aggregate. Additionally, the rules had been slightly amended to allow some share prices to move up or down with only 5000 shares changing hands. All these had affected the performance during the month in ways we still don’t understand fully. However, what should be of interest to investors is the fact that the pattern of reporting year-end results had not changed very much and that was the core reason why the present losses were predicted last November. Nigerian companies listed on the Exchange follow the same routine annually. By November, and in some cases as early as October, the Board and Management of the companies already know whether or not they are heading for a successful year or not. Year-to-date actual

However, what should be of interest to investors is the fact that the pattern of reporting year-end results had not changed very much and that was the core reason why the present losses were predicted last November

“Stock Exchange lost N780bn in turbulent Q1”, PUNCH, April 22, 2014.

results compared with budgets and forecasts for the year already reveal the situation in which the company will find itself by December 31. There are only three possible outcomes – better than expectations, just on the mark and below expectations – all these without taking into consideration the creative accounting methods that are frequently employed to achieve ostensibly good results. Then, the management games start. Managers are like kids going home with their report cards at the end of the term. The kid, who came first, rushes home; the one who came last reluctantly drags his f e e t homewards. Companies which had achieved, or are likely to achieve, r e s u l t s better than

budgets very quickly close their books at the end of December and start preparing their Annual Reports and Accounts. With or without creative accounting, they know they have a good report to give. Thus annually, the first results to be released are those of the first category of companies – those who had a successful year. This year is not therefore an exception. The next batch of results comes from those on the border line. This could mean that the turnover target was achieved but profit estimates were down or vice versa. Because most investors only look at the profit and dividends declared, adequate turnover which would ordinarily have resulted in low profits and no dividends would call for the figures to be “massaged” a little bit to make them acceptable to shareholders. This requires a lot more time to prepare. So, as general rule of thumb, if a company has not released its Annual Reports and Accounts by end of April, of the following year, then, it is probably safe to assume that it is in category two or three. The real problems are those in category three – those who had relatively disastrous results; turnover is way down;

profits are low, or losses had been incurred and there is really nothing to cheer about in the results. These are the firms which take forever to file their reports; some taking almost the whole of the following year to do it. The Nigerian Stock Exchange, NSE, and the Securities and Exchange Commissions, SEC, are forced to step in before some of these firms would act. That has again provided another rule which we use to determine the direction of things – even when the results have not been released. The longer it takes a listed company to file its returns the more likely that the news is bad. That, however, is not all. Policies announced by the Federal government, during the year, especially by the Central Bank of Nigeria, CBN, invariably impact aggregate performance in the economy on a broad front. Furthermore, despite the steps taken to reduce the influence of banks in the All Share Index, they still constitute the biggest sector. When banks are in trouble; everyone is in trouble. At the moment, the banks are still reeling from the effects of the CBN’s policies introduced late last year. New measures had since been introduced which will make 2014 a difficult year for banks for their clients and which will erode profits by increasing cost of goods with little opportunity for sellers to increase prices. Irrespective of what the banks do, they are facing a very difficult year ahead. And so is the Stock Exchange…. Visit:www.delesobowale.com or Visit:www.facebook.com/ biolasobowale

Savers Card partners Ecobank to re-launch discount card avers card international, Lagos depending on the merchant location S owners of the Savers club visited. card said its partnering Ecobank Discount centres include supermarkets, Transnational Incorporated to re-launch its premium discount card. The Savers Club Discount Card which comes as a Reloadable Card has all the features of a standard ATM card with all the CBN approved security features. The Savers Club Card powered by Interswitch is usable on all ATMs, Mobile Applications and POS Terminals in over 1,500 Merchant locations all over Lagos. The Savers Club Card grants card holders discounts on purchases up to 40 percent in over 1,500 merchant locations in

eateries, hotels, Spas, restaurants, boutiques, Laundromats, salons, bookshops, Hospitals, clinics, electronic shops, autogarages and car shops just to mention a few. The Savers Club cards can be bought in any branch of Ecobank in Lagos in what the company’s Business Development Manager, Nnenna Ejiogu referred to as its pilot phase of the partnership with Ecobank. In an innovative twist to the re-launch of the Cards, Savers Card International also partnered with three leading insurance companies to bundle the card with an electronic Third party Motor Insurance pack called the Gogo pack. By this bundle, any buyer of the GoGo pack automatically has both a “self-Service Third party motor insurance cover “ and the Savers Club Card to enjoy discounts in over 1,500 merchant locations in Lagos. C M Y K

34 — Vanguard, MONDAY, MAY 5, 2014

Tax Matters

Collection procedure (2)

Withholding Taxes (WHT) Payments made to companies and certain categories of individuals are to suffer deductions at source as follows:

RATES Interest & Penalty for Late Payment The interest is not an alternative to the penalty. Interest is for late and deferred payments while penalty is charged for late payment of tax. Interest is therefore charged in addition to the penalty in cases of late payment. Self-Assessment Penalty starts to count from the due date of payment but interest starts to count from a day after the due date of payment. Government Assessments Penalty is charged from the date the assessment was issued but interest is reckoned from a day after the assessment was issued. Example 4 A company was served a notice of amended assessment for N500,000 to replace a disputed government assessment on 1st May, 1992. The tax remained unpaid till 31st October, 1992. Comment

Default in Payment of Approved Instalments When a company defaults in the payment of the instalments as approved, the concession stands cancelled. Interest starts to count from the date the default occurs. The calculation of the interest is also on the reducing balance basis.

PENALTY FOR LATE PAYMENT Note: 1/5/92 to 31/10/92 6 months Penalty = 6/12 of 10/100 of 500,000 =N25,000 Interest Due date of payment Day of Reckoning Interest rate 02/05/92 to 31/10/92 -

01/05/92 02/05/92 20% per annum 183 days.

TOTAL PAYMENT Tax Penalty Interest Amount Payable

500,000.00 25,000.00 50,000.00 575,000.00

Deferred Payment: Interest & Penalty When a company arranges with the Service to defer the tax due, interest is chargeable but penalty may not be imposed if the application is approved. The interest is calculated on reducing balance basis. Interest on Payments in Excess of Approved Instalments When a taxpayer seeks to pay the tax due in a number of instalments greater than that approved for self assessment as specified above, interest is payable on the excess number of payments, also on reducing balance basis.

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Interest on Arrears As from 1st January 1991, arrears of tax are to carry interest at commercial rate. The interest is in addition to the annual penalty and both are to be charged annually. Lateness in Filling Application for Instalment Payments Where a company is late in applying for instalment payment arrangement, interest should be charged from the date of reckoning (a day after the due date of payment) to the date of commencement of the payments. The accruing interest should be added to the tax and spread over the number of instalments allowable under the circumstance. Petroleum Profits Tax (PPT) In view of the fact that transactions in the oil industry are in dollars and the operators are allowed to keep their proceeds of sale in accounts overseas, government has directed that the estimated tax of an accounting period under the provisions of Section 27 of the PPT Act, 1959 shall be made and submitted to the Service in US dollars and when payments are being made, each monthly payment shall be in US dollars and shall be equal to one-twelfth of the estimated tax or of the fraction of the remaining months of the accounting year for which a revised estimated tax becomes necessary and is so estimated.

Payment of withholding tax is now in the currency of the contract agreement. The individuals covered by the Federal Inland Revenue Service are the non-residents, residents of Abuja, members of the Police & Armed Forces and External Affairs Officers. Other individuals are under the tax jurisdiction of the State tax authority where the individuals reside. *The term ‘contract supplies’ covers all forms of supplies, deliveries, or the like through competitive bidding, tenders, LPOs or other arrangements, whether oral or written. The term does not cover across-the-counter cash sales or supplies in the ordinary course of sales. WHT on Investment Income (i) Non-Residents: WHT on dividends, interests, rents and royalties payable to nonresident remain the final tax. (ii) Residents: With effect from January 1992 the provisions in the Act regarding these payments as final tax have been amended. They are now to be regarded as payments on account. Remittance of WHT to Tax Authorities Failure of an agent of deduction to remit WHT within the statutory time-limit will attract: (iii) Interest at commercial rate on the amount not remitted by the agent, (iv) Prosecution of the agent for default, and (v) Denial of Tax Clearance Certificate to such an agent. Furthermore, where the agent is a government ministry, parastatal or department or a local government, the Service may authorize the Accountant-General of the Federation in writing to deduct such tax plus interest at the prevailing commercial rate from any allocation due to such agency.

Example 5 XYZ Limited, with 31st March, 1993 as the due date of payment of the self-assessment, has applied for the payment of the tax due amounting to N100,000 in ten equal monthly instalments.

The final PPT payable, that is, the thirteenth installment, shall be ascertained as provided for in Section 38 (4) of the same Act such that so much of the amount of instalments of estimated tax that had already been paid in US dollars shall be deducted from total PPT computed in US dollars based on the annual accounts.

WHT as Tax Credit Withholding taxes are advance payments and they can only be applied as tax credit to settle the assessment of the year to which the income that suffered the deduction relates. Where the withholding tax credit exceeds the assessment for a given year, the excess may be carried forward as future set-off.

Comment a.) Since the company is entitled to six instalments in the current year of assessment, the first six payments terminating on 31st August, 1993 will not attract interest. However, interest will be charged on the balance of four months on reducing balance basis as follows:

Litigation As explained above, instalment or deferred payments, as the case may be, will be approved for companies with convincing proof of serious financial problems. However where the arrangement fails to yield the desired result, legal action may be instituted against defaulters to enforce payment.

Refund/Set-off Where it is proved that the person who suffered the deduction is not liable to tax or that tax withheld is in excess of the assessed tax, the Service will grant a refund or a carry-forward, as the case may be, after the claim has been confirmed by tax audit process.

Vanguard, MONDAY, MAY 5, 2014 — 35

Agric Business BY SALIMAT GARBA

eading agriculture experts have attributed hunger and poverty tin Africa to the decline in agriculture , adding that growth in agriculture equates to a reduction in hunger and poverty. According to them, the tremendous decline in Africa’s agricultural sector in the past three decades is because of lack of investment, inadequate research and development, pest infestation, poor agronomic practices, climate change and lackadaisical attitude towards biotechnology in agriculture. Sir Brian Heap, Project Leader, Biosciences for Farming in Agriculture (B4FA) in his words says “just by applying existing and available agricultural advice and technologies, the productivity of African agriculture could double or treble. But new agricultural technologies are being developed and trailed which could achieve even more.” More so, Lord Ewen Cameron, while speaking at the B4FA book launch event at the House of Lords, London, stresses the need for Africa and the world’s

Modern technology can save farmers from poverty —Experts

Professor Sir Gordon Conway visits Alliance for a Green Revolution in Africa (AGRA) Grantees. continuous promotion of improved modern technology because of its ability to enhance food security that no other way can. Cameron expresses regrets that the financial opportunities in agriculture

are not maximally harnessed in Africa, adding that Africans are faced with challenges which are supposed to be opportunities. “There is a lot of water in Africa but there is little infrastructure for getting the water. There are many hectares of arable lands in Africa but there is land insecurity. Identifying investment in research and training farmers as

the biggest investment a government can make, he points that democracy is very important in the future of agriculture. “What are the right seeds? How do you get hold of the right seeds? Market Information, mobile phones, technology and internet are very important in democracy,” Cameron adds. For Lord Paul Boateng, the significance of local agriculture should never be forgotten. According to Boateng, while building on local agriculture, there should be adequate investment in Research and Development

(R&D) as it is critical to agricultural development in Africa. He observes that the world is presently witnessing resurgent of R&D in agriculture and that all individual countries are beginning to make headway in the Maputo Declaration. The lord, however, urges Africa to set its own agenda through the UK parliament and all other friends in Science and Technology. Furthermore, Hon Owen Peterson, Secretary of State for Environment, Food and Rural Affairs, UK, during the visit of some B4FA fellows to his office discloses that the problem the world will encounter in feeding itself in the next 40 years are very real and something to be prepared for. “At this very moment, there are one billion people on this planet who are chronically hungry. Are we really going to look them in the eye and say we have proven technology to help, but the issue is just too difficult to deal with, it is too controversial?” Peterson explains that the world population will soon move from seven billion to nine billion and there will be even fewer resources to feed on. “It is our duty to explore technologies like Genetic Modification (GM) because they may hold answers to the very serious challenges ahead.”

AU commends agriculture growth in the continent BY JIMOH BABATUNDE The Commissioner for Rural Economy and Agriculture, African Union, Tumusiime Rhoda Peace, has said that agriculture has been showing a growth performance of about four percent per annum over the last decade under the Comprehensive Africa Agriculture Development Programme (CAADP). She said this is an indication that agriculture and the rural sector are at the centre of the transformation agenda in the continent. Just as she added that public spending on agriculture in Africa has risen by over seven percent. Speaking at the just concluded African Union (AU) Joint Conference of Ministers of Agriculture, Rural Development, Fisheries and Aquaculture in Addis Ababa, Rhoda Peace commended the efforts in the increase in spending but said much more must be done on the continent. “The Decision of the African Union Assembly of Heads of State and Government to commemorate 2014 as the Year of Agriculture and Food Security and marking the 10th

Anniversary of the Adoption of CAADP, provides us all with a unique opportunity to engage ourselves in an exercise of honest assessment and reflections of the progresses made thus far. “The lessons we have learnt, and chart clear set of goals and targets for implementation in the next decade in a context of transformative agenda to get rid of hunger, malnutrition and poverty from our continent”, she added Rhoda Peace said following intensive efforts by the continental body to boost the agriculture sector through initiatives like the Comprehensive Africa Agriculture Development Programme (CAADP) public spending on agriculture has risen. But this is not time to rest, as AUmember states we must ensure we tackle all challenges in order for transformative growth to take place on the continent,” Mrs Tumusiime said. Rhoda Peace said for growth to be realized through the agriculture sector, the marginalised, vulnerable, women and young people must be taken care of. She said since 2014 being the year for Agriculture and Food Security, more needs to be done to ensure that this sector which employs over 75 percent of Africa’s workers improves livelihoods and transforms lives.

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36 — Vanguard, MONDAY, MAY 5, 2014

E- Commerce

Nikon, Jumia partner to boost camera access in Nigeria

s part of its effort to make cameras and photography equipments affordable for aspiring photographers, Nikon has launched a special bundle deals in partnership with Nigeria’s online retailer, Jumia.com Announcing this at this year’s Nigerian Photograph Expo an d Conference,

Jumia.com to purchase items of choice.” He added that, “Apart from the networking and knowledge opportunities at the NiPHEC, participants had the opportunity to explore and experience the power, innovative creativity of Nikon cameras at a specially designed exhibition booth.”

Winner emerges at Kaymu Easter Bunny Hunt

eyisan Ayo-Vaughan, an 18 year old 100 level

Project Management and Technology student of Federal University of Technology Akure, FUTA has emerged winner of KaymuEaster Bunny Hunt. The competition which was organized by the online marketplace Kaymu.com.ng to mark the Easter celebration involved a hidden bunny on the marketplace which users had to find to enable them claim the 22 inch Samsung HDTV Monitor offered by Kaymu electronics seller, Foramot. The Easter th campaign began on thest18 of April and ended on 21 of April 2014. Speaking on the event, Managing Director of Kaymu Nigeria, Massi Spalazzi said, “The Easter Bunny Hunt was created as an entertaining and engaging medium to reward customers and it brings us great joy to see it being won by not only a well deserving customer, but a youth. This just goes to show that the Nigerian youths are embracing the online shopping culture.” C M Y K

From left: Public Relations Strategist of Konga.com, Ifeanyi Abraham, Konga's Head of Marketing, Gabriel Gab-Umoden, and Alhaji Mohammed Abubakar, President of NACCIMA during Konga's emergence as theMost Innovative and Impactful retail brand in an award presented by Lagos Chamber of Commerce and Industry in Lagos.

APP MONETISATION:

Can Verve Payment Wallet save developers? BY JONAH NWOKPOKU

frica’s payment card, Verve has said that it has developed a solution that will help mobile application developers to monetize their products and services without going through the telecommunication companies. This solution called Verve Payment Wallet is designed to be integrated into mobile apps at conception stage and will provide a payment gateway through which app users and subscribers can pay using the money in their bank accounts. Verve said it is partnering with global phone maker, Nokia and software maker, Microsoft to introduce this solution on apps on windows phones. At the moment about seventeen mobile applications which have been selected for Alpha DevCon, an app contest, are already available on windows phones, using this payment gateway. It could be recalled that mobile app developers have been having difficulties placing premium on their apps because the telcos who provided the only option for a payment gateway gave stringent conditions which made their craft an unprofitable venture at the

NiPHEC, held in Lagos, Michael Imomoh, Brand Manager, New Creation International, the official distributor of Nikon products in Nigeria, said the offer is in a bid to further identify with its customers and boost access in the country. “This special deal will be valid on the Nikon 03100 DSlR camera with the 1855mm kit and special deal savers across a total of 22 product line to all registered NiPHEC participants, by using their discount codes on

With this solution for monetization, it is capable of making Nigeria a leader in African mobile App economy

end of the day. For instance, some of the telecommunication companies insisted on taking 60 percent of the app’s revenue leaving 40 percent to be shared between app store owners and the app developers. To even enter into any such partnership with the telcos required that the app developer obtain a Value Added Service licence which costs up to N500, 000. This is far beyond the reach of most of the developers, many of whom are just startups. But will this Verve Payment Wallet, which is obviously the first of its kind in the mobile

app ecosystem in Africa as far as payment is concerned, save developers the trouble of going through mobile network billing system and thus make the App economy (apponomy) begin to contribute its rightful quota to Nigeria’s gross domestic product? Verve’s Osiriame Momodu who spoke to Financial Vanguard about the solution said the Verve Payment Wallet ideally solves the payment problem for app developers. He said since the solution will enable them to integrate an effective payment system into their apps, that is all they need to scale their monetization hurdle. He said, “This has become imperative since the contribution that mobile application can make to the economy is enormous. The potential is huge. It is driving the economies of some developed countries. At the moment, it is also growing here based on just downloads. But with this solution for monetization, it is capable of making Nigeria a leader in African mobile apponomy.” He explained that, “The mobile network operators which have credit billing system would have been a good option for app developers to monetize their services but because of the 60/ 40 percent sharing formula;

the developers are not keen on exploring that option. But this billing system does not need them to integrate with any telecommunication network operator. However from inception, the app developer needs to integrate its payment system with this Verve Payment Wallet and any user of verve card can easily make payment for whatever services the app is meant to facilitate. And the charges are not as high as that of the telecommunication companies. It is just 2.5 percent compared to 60 percent charged by the telecoms companies.” This maybe the beginning of a defining moment for the mobile app landscape in Nigeria, nay Africa because of the economic motivation that venturing into mobile app development can bring. The implication is that this could result in a boom in mobile application ecosystem that will move the apponomy from the current paltry $4bn it is capable of generating at the moment to at least $20 billion in the next five years. However challenges remain, despite some level of succor this may bring to app developers, the solution’s reach beyond the formal sector is very limited since only the banked customers can benefit at the moment, excluding the huge potential of the unbanked population, who also have access to mobile phones. Also, the fact that the payment solution is still restricted to Verve excluding the vibrant market of the MasterCard and Visa also constitutes a shortcoming.

Vanguard, MONDAY, MAY 5, 2014 — 37

Insurance

PenCom to begin clampdown on defaulting employers By CYNTHIA CHIMEZIE

ollowing the amendment of the Pension Reform Act 2004 by the National Assembly recently, there are indications that the National Pension Commission, PenCom, may soon begin clampdown on defaulting organisations that fail to remit their employees’ contribution to their Retirement Savings Accounts, RSAs. Statistics from PenCom show that some employers deduct pension money from their employees’ salary but fail to remit same accordingly. Addressing journalists during the 2014 May Day celebration in Lagos, where the Pension Fund Operators Association of Nigeria, PenOp, seized the opportunity to educate and enlighten Nigerian workers on the importance of maintaining RSA, Executive Secretary of PenOp, Susan Oranye, said that the issue of remittance has become a huge challenge for the regulatory authority, Pension Fund Administrators, PFAs, and allied bodies within the pension industry. “Remittance is a challenge,” she said “but it is something that the PenCom as well as all the different operators is facing and they are trying to handle, they (PenCom) is coming out with lists of recalcitrant employers,” she added. According to her, beyond listing the names of the defaulting organisations, the body alongside PenOp and industry operators such as PFAs and Pension Fund Custodians, PFCs are following up with these organisations and have started arranging seminars, interactive sessions so that they can find out what is preventing them from remitting their employees’ fund. She said employers of labour should see adequate remittance of pension funds of their employees and adoption of such scheme by those that are yet to do so as a corporate social responsibility (CSR) to their employees and the society. “The funds are for their employees and it can be seen as a form of CSR on the part of the employers because when you are seen to be looking after your employees in the aspect of pension, and your employees are comfortable, definitely they will be loyal, because they know that you care about their welfare. And as long as they C M Y K

have that mindset, they are more loyal to you, work harder, they are more productive and the bottomline grows,” she said. Oranye, who praised the work of PenCom in the last eight years, suggested that the industry still need increased awareness and communications, adding, “Since 2004 till date, about N24.6 billion has been paid to over 84,000 retirees, no

queues, no stories.” “This is a new dispensation and this is what we are trying to get the workers to understand that this is not the old scheme and this is not the scheme where people line up, cry and beg for their money. The new contributory pension scheme is really working, it is really focused on the Nigerian workers, it is transparent, fully funded, and safe, so every worker

should join.” On why the PenOp chose Workers Day to break its new campaign, a member of PenOp Rebranding Committee, Idu Okwuosa, who is also a Senior Manager at Stanbic IBTC said pension awareness is still very low in the country despite the fact that Nigeria still holds the position of the nation with hardest working individual on the continent.

From left: Idu Okwuosa, Compliance Officer, Stanbic IBTC Pension; Comrade Tunji Sekoni, Organiser, TUC and Susan Oranye, Executive Secretary, Pensions Fund Operators of Nigeria at the 2014 Workers day commemoration held in Lagos.

FBN Insurance, Etisalat collaborate to create airtime based product By ROSEMARY ONUOHA

BN Insurance Limited, a member of FBN Holdings Plc, in conjunction with Etisalat Nigeria, has launched ‘Sure4Life”, an airtime-based insurance product designed to increase penetration and consumer access to affordable insurance products via the mobile telephone. The product will provide Etisalat customers with one month free life insurance cover between May and July 2014 FBN Insurance designed the product in partnership with Etisalat Nigeria for exclusive distribution to registered active subscribers on the network. Speaking during the launch of the product at FBN Insurance corporate head office in Lagos, General Manager of FBN Insurance, Mr. Segun Balogun, said that Sure4Life is a convenient and affordable way to access simple life protection and medical expense cover plans via the Etisalat network mobile phone.

According to him, the airtime-based insurance product will help drive availability and accessibility to a vast portion of the uninsured Nigerian population. The strategic objective is to efficiently deploy inexpensive and simple insurance protection products across various channels and market segments. Balogun said, “This initiative also supports our aspiration to bring the benefits of insurance to Nigerians who otherwise would have remained uninsured and is in line with our strategic intent to build the biggest retail insurance business in Nigeria. To this end, FBN Insurance has continued to pursue strategic opportunities in partnership with other financial service businesses and mobile network operators on key initiatives to increase penetration and distribution of our products, he said. It will be recalled that FBN Life now FBN Insurance emerged as the first

insurance company in the country to launch a mobile telephone product called Padi4Life in partnership with Airtel Nigeria one year ago. Sure4Life is currently available on the Etisalat network and enables registered post-paid and prepaid subscribers to access life insurance protection benefits and medical expenses cover (resulting from road accident only) of N100, 000 upon death and N10, 000 respectively, terms and conditions apply. To enrol for this service, subscribers are to dial *48433# from their Etisalat network and follow the prompts they receive. The plan is opened to all Etisalat subscribers between 18 and 80 years of age. Director, Business Segment at Etisalat Nigeria, Lucas Dada, said that the partnership will bring inexpensive and easy to reach insurance products to the benefit of Etisalat’s growing prepaid and post-paid customers.

ICAN blames poor exam performance on inadequate prepartion BY PROVIDENCE OBUH

Institute

Chartered Accountants of Nigeria (ICAN) has outlined the basic reasons why student perform badly in its professional exams, just as it awarded certificate of accreditation to 23 tertiary institutions and eight tuition centres which satisfied its quality control parameter for accreditation/recognition. Some of the reasons include: poor preparation, inadequate teaching personnel in terms of number and quality, decayed infrastructure and instructional facilities in many institutions, poorly articulated curricula for accounting related programmes, poor library facilities, among others, President, ICAN, Alh. Kabir Mohammed identified. To this end, he said that the Council resolved to accredit centres where its potential registered students could receive appropriate and qualitative technical and

Slok Airline to resume flight operations in Nigeria By DANIEL ETEGHE

ORMER Governor of Abia State and owner of the defunct domestic airline, Slok Airline, Dr. Orji Uzor Kalu has revealed that Slok Airline will soon resume its domestic flight operations in the country. Disclosing this development to newsmen at the Murtala Muhammed International Airport, (MMIA) Lagos, Dr. Kalu pointed out that discussions were on-going between Slok Airline and Emirates Airline to revive the airline in order to serve the Nigerian flying public. He said that both Emirates Airline and Slok Airline were discussing logistics at the moment stressing that as soon as the discussions were completed, the airline will resume its domestic flight operations in Nigeria. Dr. Kalu further noted that Slok Airline was going into partnership with Emirates Airline as one of the best

airlines in the world stressing that with the backing of Emirates Airline, Slok Airline will do better in the domestic scene in Nigeria.

38 — Vanguard, MONDAY, MAY 5, 2014

Vanguard, MONDAY, MAY 5, 2014 — 39

Advertising, Media & Marketing

Things Customers Hate – Part 2 *From Left: Medical & Regulatory Affairs Director, Sanofi, Dr. Fifen Inoussa; representing Lagos State Health Commissioner, Senior Medical Officer 1/Malaria Program Officer, Lagos State Ministry of Health, Dr. Victoria Omoera, and Key Account Manager, Sanofi, Aderinsola Taiwo, during the commemoration of the World Malaria Day held at Sanofi office in Lagos recently.

Cashless future: Paga rekindles hope with growth boost Stories by PRINCEWILL EKWUJURU

IGERIANS are finally on the brink of the cashless society that futurists and others have forecasted years back. Even when the Central Bank launched a major national campaign to persuade Nigerians and businesses to stop using cash and cheques in favour of online transactions, there were skeptisms. Even on this note however, investors had calculated it would save the economy billions of Naira yearly, if there is increase in the use of electronic payments with debit cards, smartphones and online transfers. And this became a major tendering for ad agencies to power a major marketing drive with budget estimated in millions. Nigeria government set the example by requesting their establishments to stop the use of cheques, since they are one of the heaviest users of cheques. Today, an average consumer owns at least two credit cards, and Nigerians are systematically abandoning paper bills for plastics and smartphone. Even businesses that relied heavily on cash, for instance, hotels, superstores, airlines etc — now go cashless. The recent celebration of the five years of Paga, a mobile payment platform in Nigeria, gives credence to the fact that the cashless society has finally berthed. Paga, developed on the premise of simple and easily accessible payment solutions was implemented to negate the frustration of dealing with cash and other inadequate payment channels; the platform was founded by its Chief Executive Officer, Tayo Oviosu in April 2009. Speaking on the company’s mission, he said: “our mission is to create a service that would transform lives by delivering innovative and universal access to financial C M Y K

services for all Nigerians. With Paga you can pay for any goods, service or send money to anyone with a mobile phone number or any bank account instantly. Businesses can also use Paga for any of these services and also collect

payments online from MasterCard, Visa, or Verve debit cards. Customers can also receive Western Union remittances from anywhere in the world through their Paga accounts.”

Unilever delivers on Knorr Quest promise, as winner emerges

FTER a 13-week rigorous competition, Knorr Quest Taste, a cooking competition organised by Unilever Nigeria Plc, produced a winner in the person of Dixon Olakunbi. He carted home a cash prize of N2 million, a Ford Eco Sport SUV donated by Coscharis Motors, and Kenwood kitchen equipment. Following closely as the second runner-up was Nwando Onuigbo who got N1 million cash prize and Kenwood kitchen equipment and third prize went to Olabode Akinyoola who won N500,000 and Kenwood kitchen equipment. All other contestants went home with a consolatory prize of Kenwood kitchen equipment. For the last challenge of the season, the finalists were told to prepare a three-course meal within 1 hour, 30 minutes. Ingredients for the starter include catfish, garden egg, avocado, cous cous, quinoa and atarodo. For the main, ingredients comprised lamb, corn, breadfruit, plantain, rice, fettuccine, zucchini, pumpkin, aubergine, leeks and chocolate. To complete the three-course was dessert ingredients such as mango, melon, flour and butter. Expressing her satisfaction at the outcome of the show, Nsima Ogedi-Alakwe, Brand Building Director, Foods, Unilever, Nigeria said that the winner had displayed skills and talent worthy to be crowned as Nigeria’s best cook. “I am extremely satisfied. I take that from the excitement from the audience and the winner. She has displayed skills and talent that set her apart from her

contemporaries. About 14 of them started out when the show began some 15 weeks ago. Anybody could have won,” she submitted. Head of jury, Dr Roberts confessed that although he was not a lover of avocado but he could not resist Dixon’s experiment with the fruit. According to Roberts, the final decision was not easy but based

Hollandia ends promo

hi Limited, owners of the Hollandia yoghurt national consumer promo has produced winners who are to travel to London and Paris respectively. The emergence of the winners is in line with its promise of rewarding consumers who participated in the Hollandia yoghurt ‘Refresh N Win promo’ where gifts worth millions of Naira were won by participants. A consumer in Benue State, Chigozie Victor, won the grand prize of trip to London while another consumer in Oyo State, Akinwole Dolapo, is to travel to Paris. The promo which commenced last year was closely monitored and supervised by the Nigeria Lottery Commission and the Consumer Protection Council. Managing Director of Chi Limited, Mr. Deepanjan Roy, said the Hollandia Yoghurt Refresh N Win Promo was the company’s way of rewarding customers who have been loyal in their patronage of Hollandia Yoghurt over the years. “These customers have been there for us over the years.

CONTINUED FROM LAST WEEK Arguing with the customer Who likes to lose an argument? Not the customer. I suggest you work hard to avoid an argument with your customers. Even when you know they are wrong, it will be unwise to bluntly tell them so. Telling them they are wrong may be perceived as an act of humiliation. It is better to explain your position tactfully, without sounding judgmental. Your logic may not always make sense to your customers. Of course, you may educate them without making them lose face. It’s all in the approach. Interrupting the customer (Cutting the story short!) Allow the customer to express her feelings of anger or frustration. If you cut her short you may lose some vital information that might help you resolve her problems. Being allowed to express herself also gives the customer some satisfaction and a sense of relief. You don’t want your customers to bottle up their anger. Being defensive about customer complaints (“Yes, but….”) Acknowledge a complaint whole-heartedly. Apologise and resolve the complaint. Being defensive won’t take you anywhere. After all, your few customers who complain are giving you a second chance. Most dissatisfied customers simply walk away. Someone said that complaints are like a gift. Please accept them. “Look, even our big customers don’t trouble us like this.” This is as good as telling the customer to take his business elsewhere. It also denigrates the customer, making him appear unimportant. He won’t come back, unless your company is a monopoly. Being given a take-it-or-leave-it option. Believe me, customers always have a choice. Don’t treat them as if they had none. Only monopolies adopt this arrogant posture. But even monopolies don’t last for ever! Forgetting a customer’s name. If you’re in business, you’d better have a damned good memory. You must remember names and faces – especially the very regular ones. People generally feel hurt when you forget their names. I think people love to hear their names. That’s just the way they are wired. You can use it to your advantage. Wrongly spelling a customer’s name. If you’re in doubt, always ask for the correct spelling. My name is Allwell. I am not amused when some people carelessly write: Howell, Alwell or even Owell! Again, some people believe I must be “Allwell-Brown.” Anyway, I always tell them I’m not. Wrongly pronouncing the customer’s name Some of us make fun of our mistake after pronouncing a name wrongly. It is bad enough not to know the right pronunciation; making fun of your mistake is almost unforgivable. Attending to customers out of turn It is not fair to attend to a customer before his turn just because he is your relation, friend or benefactor. Doing so will alienate those who came before him. It also smacks of corruption. You may want to have a separate service area for high-value customers who require special treatment. Fixing your eyes on the computer (or whatever else) while the customer is talking. How would you take that if you were a customer? Whenever I am confronted with the computer-age nuisance, my stock response is to keep quiet until I get full attention. You need to maintain eye contact with your customers.

What are those things you don’t like as a customer? To share them on this page, send an email to: allwellnwankwo@gmail.com. TO BE CONTINUED.

40 — Vanguard, MONDAY, MAY 5, 2014 Email:lesleba@lesleba.com, lesleba@gmail.com Blog page:www.lesleba.com/blog2 Website: www.lesleba.com Tel:0805 220 1997

education also instigated an exodus of students from affluent homes to expensive educational institutions abroad. Conversely, while children from privileged homes may pay over N8m ($50,000) to study abroad, thousands of their indigent counterparts constantly risk their lives across deserts and turbulent seas to also seek greener pastures abroad. Ultimately, the beneficiaries of our failed educational system are primarily the sponsors of local private educational institutions as well as colleges and universities in Europe, Canada and United States. Indeed, if barely a hundred thousand youths pay an average of $50,000 annually for tuition and living expenses, this would result in a minimum outflow of about $5bn (N800bn) annually (i.e. well beyond the relatively paltry consolidated allocation of about N400bn in the 2014 budget for the whole country. Sadly, the print and electronic media now readily tell a tale of a new scramble by foreign institutions to attract fee paying Nigerian students. Sadly, however, if economic mismanagement of public resources subsists, only a fraction of our overseastrained students will return home after graduation. Such an event is fortuitously a winwin outcome for those first world economies, who are ironically, our shylock creditors as well as beneficiaries of the expensive sacrifice we make for our children to study abroad. Nonetheless, those sponsors of foreign education may take comfort in the knowledge that their wards are less likely to be kidnapped or subjected to the uncertainties and the abiding trauma of survival at home.

Commercialization of education and the storm ahead now being sounded by the steady growth of private and profit-oriented tertiary institutions nationwide; meanwhile, the graduates of government institutions are now largely adjudged by both public and private sector employers of labour as uneducated and an embarrassment to the institutions from whence they came. Ultimately, we must be wary of a huge population of quarter-baked youths with no jobs. The mind boggles at the scary prospect of the impact of the disconcerting disparity of opportunities between a small elite and a huge population of impoverished, largely untrained have-nots! Sadly, the whole structure of youth education in Nigeria has now become as commercialized as a cash and carry supermarket. The most disturbing aspect of this phenomenon is the high cost of private education. In a country where the highest paid civil servant earns less than N1.5m a year and the least paid civil servant earns less than N100,000 annually, indications are that primary and secondary school fees exceed N50,000 for the cheapest and over N1m for the elitist cadres. Pray, how do civil servants, who send their children to private educational institutions, manage the abracadabra with their meagre salaries?” The preceding is an edited excerpt from an article, which was first published in August 2005, with the above title (see w w w. l e s l e b a . c o m ) . Regrettably, almost a decade thereafter, the chickens are coming home to roost. In reality, the quality of

he youths, they say, “are the future of any nation”. In the light of this awareness, the process of youth education and development would be top priority on the list of objectives for any progressive nation. The wealth of a nation garnered from the toil, sweat and sacrifice of its people will be carelessly dissipated in the next generation, if the training and education of its youth is handled with levity. The critical question therefore, is whether or not our educational policies and programmes can produce the expected quality of youth development that would ensure successful sustainability of the Nigerian project. Private investment, wherever it occurs, will generally be driven by the profit motive; consequently, if youth education is left solely in the hands of entrepreneurs, the basic right to education may only be available to the small elitist class, who can afford it. The majority of citizens, who are financially challenged, will remain largely uneducated, and untrained and ultimately become social liabilities, who will retard wealth creation and probably also predicate social insecurity. Nonetheless, education seems to have been sucked in by the controversial wind of privatization of public utilities. Consequently, the number of private primary schools has gradually increased from a ratio of, say, 1:20 public schools to what may now be a ratio of about three private schools to every governmentsponsored primary establishment. The products of these private primary schools, in turn, quickly provided a heavy stimulus for the growth also of private secondary schools. The death knell of a predominantly governmentsponsored education sector is

Nonetheless, education seems to have been sucked in by the controversial wind of privatization of public utilities

education in public institutions has been adversely affected by inadequate funding, as well as political and economic factors; for example, in spite of United Nation Educational, Scientific and Cultural Organisation’s best practice recommendation for 26% of annual budgets to be allocated to education, regrettably, for decades, education votes have hardly exceeded 15% of annual b u d g e t s . Worse still, the recurrent component of expenditure generally consumes the lion’s share of the vote, while the usual delay in passage of budgets and unbridled corruption would further reduce the possibility of full implementation of the relatively paltry capital vote for education. The ubiquitous dilapidated structures and facilities in our educational institutions are the inevitable products of inadequate funding and misappropriation of the meagre annual educational budgets; the protracted industrial actions by staff unions, such as the yet unresolved 10 months old strike of polytechnic teachers, and the horrid regular dislocation of academic calendars with the attendant oppressive impact on parents are also due to inadequate funding. Furthermore, the instruments of quota system

and disparate cut-off marks for admission of students from different states into government institutions is undoubtedly a monumental injustice; how does one rationalize the rejection of a candidate with excellent scores because of their state of origin, while automatic admission awaits abysmal failures from some other states? The decay in the education sector accelerated with the reckless depreciation of our national currency by over 95%, between 1985 and today! The remuneration package for teachers in primary and secondary schools as well as lecturers in our universities became inadequate to meet the survival needs of these of these cradle watchers; the result has been a mass exodus and loss of some of the best brains in the country to foreign pastures. Expectedly, poverty has deepened as several industries and businesses collapsed, as the naira steadily depreciated from stronger than 1:1 to today’s N160/$1. The promotion of misguided government policies and deliberate lack of transparency and accountability also induced corrupt practices with public accounts and also further widened the gap between the rich and the poor. Ultimately, the dismal quality of

SAVE THE NAIRA, SAVE NIGERIANS!

Business & Economy BY JONAH NWOKPOKU CBN bars debtors of closed banks from new facilities System and approved private ll the people still He further said that one of money payment and their crucial.” sector credit bureaus. the banking industry reforms, implication for sustainable A indebted to any of the He noted that the the implementation of the Risk banking have remained closed banks up to the tune of N250 million have been prohibited by the Central Bank of Nigeria, CBN from accessing new loans in any deposit money bank in Nigeria. The Managing Director/ Chief Executive Officer of Nigeria Deposit Insurance Corporation, NDIC, Alhaji Umaru Ibrahim disclosed this while delivering a keynote address at the corporation’s 2014 bank examiners’ conference held in Lagos. He said the banks have been notified of the development and charged bank examiners to ensure compliance with the new directive. He said the names of the debtors will soon be made available through the CBN’s Credit Risk Management C M Y K

corporation has continued to face challenges of debt recovery in terms of debt owed the closed banks, some of which remain unrecovered since 1994. Earlier, he noted that the primary objective of the conference is to update the examiners’ knowledge and skills on contemporary supervisory toolkits for delivering the mandate of bank supervision thereby contributing to the safety and soundness of the insured institutions. The conference, he explained, provided an opportunity for supervisors and operators as well as other stakeholders to brainstorm on topical issues that continue to shape the nation’s financial industry.

Based Supervision, has led to significant improvement in risk management practices by banks. “Supervisory and financial reporting approaches such as macro prudential supervision, sustainable banking, International Financial Reporting Standard, Basel II/ III and consolidated supervision have also been substantially implemented in the bid to strengthen the system,” he added. He explained that, “Without prejudice to the foregoing, the challenges of lending in the Nigerian environment, corporate governance, and impact of fixed income securities on the financial position of deposit money banks, technological innovations including mobile

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