financial vanguard december 17th edition

DECEMBER 17, 2012

Tiger Brand’s incursion in Nigeria’s food industry could create monopoly …SEC urged to monitor anti-trust activities

BY NKIRUKA NNOROM

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he recent take-over of majority stake in two of Nigeria’s leading food manufacturing companies – UAC Foods and Dangote Flour Mills- by a South African company, Tiger Brands, could create unhealthy monopoly in food industry, industry stakeholders have warned.

They said it was time the Securities and Exchange Commission, SEC, began to monitor the activities of Tiger Brands to guard against capital flight and anti-trust activities that may emanate from the aggressive takeover

bids by the company.

Tiger Brands had in September this year, announced that it has bought 63.35 percent equity stake in Dangote Flourmills, DFM, one of Nigeria’s largest flour and pasta producers. As part of the deal, the Dangote Group will retain 10 percent strategic stake in DFM, while Aliko Dangote will also remain chairman of DFM. Tiger Brands had also spent whooping N30 billion, an equivalent of $190 million in its acquisition bid in DFM. Last year, Tiger Brands made its first two acquisitions in Nigeria when it bought biscuit manufacturer, Deli Foods and secured a 49 percent stake in UAC of

Nigeria’s food and beverage businesses.

According to Wale Oluwo, Managing Director, Investment Banking, BGL Securities Limited, the worrisome thing about the acquisition is Tiger Brands’ preference for taking over already flourishing food companies, instead of setting up and managing their own companies from scratch. He lamented that it was unbecoming of Securities and Exchange Commission, SEC, whose role it is to monitor anti-trust transactions not to have taken note of the disguised monopoly being created by the incursion of Tiger Brands into

Nigeria “The acquisition and any inflow of investment into the nation is a positive development for the companies, the industry and the economy as it represents foreign investment into Nigeria. However, I would have been happier if Tiger Brands had used its cash to either set up their own new facilities like the telecom operators did or acquire and turn around moribund flour milling and food processing companies in Nigeria.

“Tiger Brand has shown a strong appetite for taking over our biggest and very best. The Securities and Exchange Commission, which regulates anti-trust issues in the economy, should start showing interest in the activities of Tiger Brands in order to prevent the emergence of a Continues on page 18

138.6

-2.55

2,423.00

+1.00

18.65

0.11

108.92

+1.01

86.19

+0.30

CURRENCY BUYING CENTRAL

The MD/CEO Bank of Industry, Ms Evelyn Oputu commissioning the Filmhouse Cinema in Surulere, Lagos, flanked from right to left, by Mr. Waheed Olagunju Executive Director - Business Development, Bank of Industry, Mr. Kene Mkparu, MD/CEO The Filmhouse Limited, Mr. Ladi Balogun, MD/CEO First City Monument Bank Plc, Mrs. Ozy Mkparu, Head of Human Resources, The Filmhouse and Mrs. Tokunbo Chinedu MD/CEO Compass Consulting. The Filmhouse Cinema is the first BOI-assisted project in the Creative & Entertainment Industry.

DOLLAR 154.77 STERLING 249.4892 EURO 202.5939 FRANC 167.5363 YEN 1.8473 CFA 0.2895 WAUA 237.0639 RENMINBI 24.794 RIYA 41.2676 KRONA 27.1488 SDR 237.8196

155.27 250.2952 203.2484 168.0775 1.8533 0.2995 237.8297 24.8746 41.4009 27.2365 238.5879

SELLING 155.77 251.1012 203.9029 168.6187 1.8593 0.3095 238.5956 24.9551 41.5342 27.3242 239.3562

CBN Exchange rate as at 14/12/2012 C M Y K

18 — Vanguard, MONDAY, DECEMBER 17, 2012

Cover Story

Youth restiveness and unemployment in Nigeria: The way out

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he words ‘youth’ and

Tiger Brand’s incursion in Nigeria’s food industry could create monopoly Continued from page 17

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disguised monopoly or a restraint of competition, which may happen by the time Tiger starts to consolidate her interests in these companies they are acquiring,” he warned.

He observed that efforts should be made to guard against capital flight, saying, “What Nigeria should be concerned about at this time is to guard against capital flight through expatriate quota violation and over invoicing, particularly when these companies are importing raw materials and repatriating dividends/ investments. If unchecked, it has the tendency to add to the pressure on the Naira exchange rate in the short and medium term.”

He remarked that the option of establishing their own companies as against acquisition would have engendered better competition, increased output/export and job creation for the nation.

Agreeing with him, Mr. Tola Odukoya, an analyst with Dunn Loren Merrifield, DLM, said the acquisition will not have any significant impact on domestic flour milling. “This is because the acquisition of Dangote Flour may be a backward-integration strategy for Tiger Brands with the aim of achieving greater cost efficiency in terms of their operations in UAC Foods given that the company’s products are largely flourbased.”

Odukoya, however, stated that in terms of prospects, the acquisition would increase the visibility of food manufacturing in Nigeria as other global brands may follow in Tiger’s footsteps given the inherent opportunities in Nigeria based

Value addition to shareholders

Tiger Brandswould bring its distinctive competence in the industry to bear on the Food manufacturing sector in Nigeria

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on the sheer size of the domestic market.

For him, possible significant increase in output of both UAC Foods and Dangote Flourmill may lead to an increase in contribution to domestic output.

For Mr. David Adonri, CEO, Lambeth Trust & Investment Co. Limited, Tiger Brand’s acquisition of stakes in UAC Foods and Dangote Flourmill is foreign direct investment in Nigerian economy which indicates positive development for the economy in general. He noted that in addition to the benefit of financial inflow, the foreign investor – Tiger Brandswould bring its distinctive competence in the industry to bear on the Food manufacturing sector in Nigeria.

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ll the stakeholders that spoke to Vanguard agreed that shareholders of the companies acquired by Tiger Brands are the ultimate beneficiaries as the deal would not only impact the financial performance, but also induce interest in their shares. This, according to them would result in significant price appreciation, which, of course, investors would benefit from. In the words of Wale Oluwo, “The acquisition deal ordinarily should be beneficial to the shareholders if the valuation and acquisition price favours the legacy shareholders in the companies.”

Continuing, he said, “I expect the value of the shares to eventually appreciate when Tiger Brands unveils its plan for the acquired companies.”

Adonri explained that because the transactions were by way of sale of existing shares, the existing shareholders’ holdings remain undiluted, adding that additional foreign investments would strengthen the value base of the domestic companies.

“If the benefits attendant to these foreign investment translate into positive impact on the fundamentals of the companies, the stock market will react positively,” the Lambeth CEO stated.

Shareholders would be the ultimate beneficiaries of the additional value created in the companies in the years ahead, said Odukoya and the value created would obviously have a positive impact on the companies’ financial position and thereby drive Continued on page 19

‘restiveness’ have become so commonly used together in the last couple of years that it seems to have taken on a life of its own. In the last decade and more there has been a proliferation of cases all over the country and indeed the world, of youth agitations which have tons of people dead and valuable infrastructure as well as personal properties lost and destroyed.

A sustained protestation embarked upon to enforce a desired outcome from a constituted authority by an organised body of youths, fits the label of youth restiveness. It is also a combination of any action or conduct that constitutes unwholesome, socially unacceptable activities engaged in by the youths in any community.

It is a phenomenon which in practice has led to a near breakdown of law and order, low productivity due to disruption of production activities, increasing crime

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From left : Mr. John Ekpikhe, Senior Consultant with Mark-George Consultants and Mr. Jude Anele, Head Retail Banking with Diamond Bank Plc at the Diamond Bank - 26th BusinessXpress Seminar in Lagos.

A sustained protestation embarked upon to enforce a desired outcome from a constituted authority by an organised body of youths, fits the label of youth restiveness

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rate, intra-ethnic hostilities, and harassment of prospective developers and other criminal tendencies.

This scourge has been around for a long time and it looks as though it is defying solutions. Maybe the question that needs to be asked is what is truly responsible for this expression of dissatisfaction by the youth? Have their complaints over the years not been heard or attended to? Is there more to the killings and destruction than just drawing attention to the needs they want met?

Are the youths trying to draw society’s attention to themselves more than the issues they appear to be fronting? These and more are the questions we would try to tackle head on today.

In Nigeria for instance, the Niger Delta region which is unarguably the bedrock of the oil industry in Nigeria permeated the news for a lengthy period of time as the youths of that region tried various means of getting government and oil companies to pay attention to their dire conditions of living and alleviate their sufferings since according to them, the resources which is building the nation is flowing from their land so by virtue of that they should also be partakers of its benefits. This strife led to a rise in kidnapping and vandalization of oil pipelines as well as other vices that were being perpetrated. After a period of years, the Nigerian government intervened and the Amnesty program was created to help deliver some of the promises which government had made to the youths in those areas.

The baton was soon handed over to the Eastern Nigeria. Increase in the rate of armed robbery attacks, kidnappings as well as unbridled thuggery became the order of the day.

Today the Northern part of Nigeria has literally erupted with unrivalled violence.

Bomb blasts, kidnaps and killings of Nigerians and others have become the prevailing trend. Despite beefing up of security in these areas, the problems still looms. This situation begs the questions, ‘’what is the government of the day willing to do to put a permanent end to these problems.

STATISTICS The National Population Commission (NPC) has said the country’s population has risen from the 140,431,790 it was five years ago when the last national headcount was taken, to 167,912,561 as at October 2011.This represents an annual population growth rate of 5.6 million people.

The Ministry of Youth Development, said recently that there are 68 million unemployed youths in Nigeria.

Every year about 300,000 graduates enrol in the NYSC scheme. This is definitely not the total number of graduates but it is a pointer.

According to the Population reference Bureau, the population of youth in Nigeria is 43%.

Vanguard, MONDAY, DECEMBER 17, 2012 — 19

Public Private Partnership: The new way to infrastructural provision for the high volume of traffic, save the road from the wear and tear a three way carriage will face and enable the company recoup its investment on time. But because the design has been put in place and the contract signed, changes were not immediately forthcoming, so financiers backed out.

It has become public knowledge that the Infrastructure Concession Commission which was set up

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ecently the media was awash with the news of the revocation of the concession granted to Bi-Courtney to reconstruct the Lagos/Ibadan road which has been in a deplorable state.

The decision to revoke the concession sparked off a lot of debate as to the seriousness of government to the whole idea of Public Private Partnership.

The concession of Lagos/ Ibadan road cannot be truly described as a true public private sector partnership. It does not pass the true test of a public private sector partnership that could deliver service to the people of Nigeria and give value for money.

The concession did not follow the due process of competitive bidding; it had no adequate study of traffic flow on which to develop a bankable financial flow, and the parties to it did not resolve the right of way between the federal government, the three states of Lagos, Ogun and Oyo. It is not known that the company has undertaken a project of the magnitude anywhere before now. It has no experience on road issue.

The process that gave the company the concession was fraught with political patronage and the exercise was doomed to fail right from the word go. Bi-Courtney due to its inexperience in road matters and issues of Public Private Partnership took a road design from the federal government that was defective and un-bankable so it could not source international financing for the construction of the road.

The Lagos/Ibadan express carriage was designed by government to be a three carriage way on both side, but financiers felt that the traffic from Lagos to the Shagamu exchange of the road was too heavy for a three carriage way that it should have been five.

A five carriage way will allow

The concession did not follow the due process of competitive bidding, it had no adequate study of traffic flow on which to develop a bankable financial flow, and the parties to it did not resolve the right of way between the federal government, the three states of Lagos, Ogun and Oyo.

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by the government had advised against the concession but was ignored.

This put a whole question mark on the sincerity of government in its desire to provide infrastructure to the Nigerian people.

Unfortunately, Nigerians do not hold government accountable for its action and inaction. While the deception on the reconstruction of Ibadan Lagos road is on going, the Nigerian populace is the ones that suffer and some even die on the road on daily basis. The Minister of Works, Mr. Mike Onolememen, was so arrogant about the whole exercise and with impunity told the nation that Julius Berger has been mobilised to cite.

Onolememen, as usual, failed to tell the nation when the contract for the rehabilitation was awarded and how much it will cost to do so.

This government is pretending about the Public Private Partnership. Public procurement is the favoured way of this government doing things. Because of the high level of corruption inherent in public procurement, ministries, department and agencies of government are favourably disposed to using it instead of PPP. Nigerians should ask the Minister of

Works why he failed to allow the open tender for the Lagos Ibadan road rehabilitation on the one hand and the concession of the Lagos/Benin road which work has long been completed. Nigerians must ask this government to open up and direct all MDAs to send all commercially viable projects in their control to the Infrastructure Concession Commission.

Nigerians are prepared to pay for service provided it is available in qualitative terms.

The way the government is paying lip service to infrastructure provision, Nigeria may never get the required services. There is variety of concession and partnership arrangements.

Some of the most commonly used are Private Concessions, where the private party takes over all aspects of facility management and operation from the government, often on a longterm basis. The private party responsibilities include maintenance and specified rehabilitation and capital investment in facility upgrades and enhancement.

The private party is fully responsible for raising the required capital. This may take the form of BuildOperate-Transfer (BOT), Build-Operate-Own (BOO) or Build-Own-Operate-Transfer (BOOT), Design-BuildOperate-Transfer (DBOT), Design-Build, Finance and Operate (DBFO). Other less common variants include BRT or BLT (build, rent/lease and transfer and (BTO) Build Transfer and Operate.

PPP as it is popularly referred to has become the most widely used vehicle for socio-economic transformation

Cover Cont.

, Unfortunately Nigerians do not hold government accountable for its actions and inactions. While the deception on the reconstruction of Ibadan/Lagos road is on going, the Nigerian populace is the ones that suffer and some even die on the road on daily basis.

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of society both in the developed and developing economies. In Britain, the system was introduced in 1992 and since then several social infrastructure has been developed through it.

Incidentally, one of the chief success factors of the scheme in Britain is a Nigeria, Mr. Wale Shonibare, Associate Director of KPMG in London.

He has traveled to almost all the continents of the world consulting for governments on PPP. Governments across the globe have come to terms with the fact that public sector alone cannot provide the needed infrastructure and have come to the conclusion that private sector participation in the provision of infrastructure is inevitable. Nigeria cannot be an exception

Tiger Brand’s incursion in Nigeria’s food industry could create monopoly appreciation on the stocks’ prices, and vice versa.

Reason for the acquisitions

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xplaining the reason for its quest to take over Nigeria’s biggest and best companies, Tiger Brads said in an official statement that “Nigeria is a key strategic growth market in West Africa, the second largest African economy and one of

the fastest growing economies in Sub-Saharan Africa with an estimated population of 160 million and projected average real GDP growth forecast over the next three years of approximately seven percent per annum.” Tiger Brands also believes that the acquisition would add scale to its existing Nigerian businesses and allow it to take advantage of the market opportunities in Nigeria’s food sector.

The company said, “DFM is a market leader in both the flour and pasta market

segment of the Nigerian consumer food sector with strong branding, production and distribution capabilities.

DFM started its flour milling business in 1999 as a division of the Dangote Group. It is currently the largest flour milling company in Nigeria with a market share of around 30 percent; its share in the pasta market is approximately 40 percent. Tiger Brands is also confident that it can use its experience in the food sector to further develop and grow DFM.”

Thushen Govender, Head, Business Development, Tiger Brands, recently said in an interview that when deciding where to invest, Tiger Brands first performs an analysis of African countries by assessing the socio-economic environment, consumerdriven factors, GDP, GDP per capita and population among other things.

He noted that countries like Nigeria feature quite highly given their improving macro and socio-economic conditions. “Egypt and

Ethiopia will feature highly because of their populations, and this is of importance to c o n s u m e r - d r i v e n organisations over the medium to long term. If one were to consider growth alone, Angola, Ethiopia and Nigeria would all feature highly.”

Over the past few years, Tiger Brands has increased its foot print in the rest of Africa. In addition to Nigeria, it currently has operations in Cameroon, Ethiopia, Kenya and Zimbabwe.

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20 — Vanguard, MONDAY, DECEMBER 17, 2012

Business & Economy BRIEFS CIIN President says ‘No premium, no cover’ policy will help build investable funds

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resident of Chartered Insurance Institute of Nigeria (CIIN), Dr Wole Adetimehin, has said that the enforcement of “No premium, no cover” policy would help insurance industry build investable funds. Adetimehin told newsmen that the insurance industry had been unable to build enough pool of investable funds because premiums were not paid promptly.

The Nigerian Insurers Association (NIA) recently said it would start enforcement of the insurance policy on ‘No premium, no cover ’ from January 2013.

This means that no insurance policy will be written or renewed without immediate payment of premium from January 2013. According to CIIN President, over the years insurance companies have not been able to build enough pool of investable funds because policy holders delay in paying their premiums.

Bureau for Public Enterprises approves payment of salary arrears for NITEL workers The Bureau for Public Enterprises (BPE) has approved the payment of six months out of the 11 months salary arrears owed workers of the Nigerian Telecommunication Limited (NITEL). The acting DirectorGeneral of the bureau, Mr Benjamin Diki, announced this in Abuja on Thursday when he received a delegation of the Senior Staff Association of Communication, Transport and Corporation (SSACTAC).

The delegation was led by Mr Elais Kazzah, President of the association. Diki also told them that approval had been secured for the payment of five months out of the 12 months arrears, being owed workers of M-TEL, the mobile arm of NITEL. He said that security men attached to NITEL property across the country would be paid three months out of 12 months arrears owed them.

The payment, according to him, will be made before the end of the week.

EU countries strengthen trade, investment ties with Nigeria P

olicy makers in European countries have said that in spite of the slow growth in the advanced economies, the Nigerian economy, which has continued to grow at about seven percent in the last 10 years, present huge opportunities for savvy investors to leverage on. The leaders of some of the strongest EU countries agreed after meetings with the Nigerian Minister of Trade and Investment, Mr. Olusegun Aganga, that trade and investment ties between their countries and Nigeria must be strengthened at this critical phase of the World economic history for the benefit of Nigeria and their countries alike.

The President of the Republic of Finland, Mr. Sauli Niinisto, who received Aganga in Helsinki, Finland, said there was a new world emerging in favour of African economies, noting that Nigeria’s indices were particularly impressive.

He said Finland would put machineries in motion to ensure that economic ties between Nigeria and Finland were strengthened and to directly or indirectly support Finnish companies to invest in Nigeria. The result of the trade and investment collaboration, he said, could only be beneficial to both countries. The Minister of

European Affairs and Foreign Trade, Finland, Mr. Alexander Stubb, who disclosed that bilateral trade between Nigeria and Finland was currently 23 million euro, added that the two countries must begin to explore their comparative and competitive advantages for a win-win trade and investment relationship.

Stubb said only three EU countries, including Finland, were rated “triple A” by international rating agencies, adding that anyone doing business with Finland had

nothing to fear because “a Finnish handshake is something you can trust.”

As the first step in the efforts towards strong economic ties with Nigeria, Stubb said he would lead a trade delegation to Nigeria as early as possible in 2013. Aganga, however, said that the 23 million Euro trade between Nigeria and Finland was poor, urging the business delegation from both countries to come up with sound ideas and strategies to increase activities and enhance inclusive economic growth in Nigeria.

“In Nigeria, the administration of President Goodluck Ebele Jonathan is doing everything possible to make the Nigerian environment friendlier for businesses to thrive. Unlike in the developed economies, where the situation is generally low growth, low returns, in Nigeria, the story are that of high growth, high returns,” he said. On her part, the Minister of Enterprise, Sweden, Ms. Annie Loof, said on Thursday in Stockholm, during a meeting with her Nigerian counterpart, Olusegun Aganga, that manufacturing contribution to GDP in Sweden was 25% while 80% of global technology in mining was from Swedish companies.

From left, Atedo Peterside and Arumah Oteh at a National workshop

SMEDAN partners German agency to release fresh MSMEs data

By FAVOUR NNABUGWU

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mall and Medium Enterprise Development Agency of Nigeria [SMEDAN] in collaboration with German Agency for International Cooperation [GIZ] is set to release a fresh data of Mico, Small and Medium Enterprises, MSMEs in the country.

The duo at a presentation of Enterprises Baseline Survey [EBS 2012] report conducted in five Pilot states of Kwara Niger, Plateau, Oyo and Ogun to the public in Abuja recently, conducted a survey to complement the data generated by the 2010 National MSMEs Survey conducted by SMEDAN in collaboration with the National Bureau of Statistics [NBS].

Minister of State for Trade and Investment, Dr. Samuel Ortom, restated the role of MSMEs globally, describing

them as incontrovertible contributors to job creation, wealth creation and poverty alleviation. Dr. Ortom stated that the relevance of data for planning and implementation of development programmes in the MSMEs sub-sector in Nigeria cannot be over emphasized. He lamented that it had been very difficult to translate the general policy framework into effective and sustainable intervention programme for the benefit of the MSMEs sub-sector in Nigeria. The Minister who was represented by his Special Assistant on Investment, Mr. Adyorough Tavershima, also stressed deliberate effort must be put in place to grow the number of MSMEs in the country if Nigeria must achieve its national vision of being among the 20 industrialised nations by 2020. On the Enterprise Baseline Survey, Ortom said the survey came

up with several findings in the areas of access to finance, improving the business environment promoting value chain and regional economic integration within the ECOWAS sub region. He assured that the finding and recommendations of the EBS report would be utilized in the on-going review of the National Policy on MSMEs and other intervention programmes of the federal government aimed at moving the MSMEs sub sector forward SMEDAN Director-General, Muhammed Nadada Umar, noted that credible and reliable data are crucial to any nation’s planning and policy formulation. He said the baseline survey conducted in the five states couldn’t have come at a better time than now considering the fact that SMEDAN in collaboration with the National Bureau of Statistics NBS recently

conducted and released the National Micro Small and Medium Enterprises survey in 36 states of the federation and the Federal Capital Territory.

Nasada lamented the neglect suffered by the MSMEs in the country since independence, adding if our founding fathers had articulated an MSME policy, we would have been better off by now, adding a nation without economic independence would never enjoy its political independence. Alhaji Nadada paid glowing tribute to the German Agency for International Cooperation (GIZ) for partnering with SMEDAN in the survey project and re-affirmed the Agency’s continuous support and cooperation with GIZ on its development initiatives, particularly the Pro-Poor Growth and Promotion of Employment in Nigeria SEDIN programme.

He appealed to GIZ to C M Y K

Vanguard, MONDAY, DECEMBER 17, 2012 — 21

Business & Economy

C-River, Bank of Agriculture sign N200m MoU to grow SMEs

BY JOHNBOSCO AGBAKWURU HE Cross River State Government and the Bank of Agriculture have signed a Memorandum of Understanding, MoU, to raise the sum of N200 million to support Agro-Small and Medium Enterprises, SMEs, in the state.

Speaking after signing the MoU, the Acting Governor of the state, Mr. Efiok Cobham, said that SMEs was pivotal to the socio-economic development of the nation.

Cobham explained that the loan facility which the state government was contributing 50 percent as its counterpart fund would go a long way in upgrading the financial status of young entrepreneurs who he said were the main target of the initiative as well as creating sustainable employment opportunity for them.

He commended the bank for its innovation in introducing programmes aimed at youth

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and women empowerment in its agenda which will improve their economic stands and urged the bank to also consider funding of agroallied processing industry to add value to agricultural produce, especially perishable goods.

The Acting Governor said that the state being an

agrarian, there was dire need for it to re-strategise and be more proactive in initiating programme to make agriculture more attractive to the youths with the view to encouraging them to venture into the sector that was seemingly been neglected over the years and solicited

the bank’s technical support in that direction.

Also speaking, the representative of the Managing Director of the bank, Mr. Sam Elibe, said the exercise was the actualisation of the bank’s mandate of growing agriculture and creating a platform for rural

Airtel completes 4G LTE trial in Nigeria … Set to lead new phase of telecoms revolution irtel Nigeria has announced the successful completion of the Long Term Evolution (LTE) trial in Lagos, the commercial nerve centre of Nigeria. LTE, widely accepted as the true 4G, is a standard for wireless communication of high-speed data for mobile phones and data terminals. It is based on advanced network technologies with a central focus of increasing the capacity and speed using a

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different radio interface together with enhanced core network. With the successful completion of the first 4G LTE trial in Lagos, Airtel said it is ready for test in the other major cities across the country, including Abuja and Port Harcourt.

The company added that the Lagos trial threw up exciting results as data users could open up simultaneous HD Videos on Youtube without buffering. Download speed,

under ideal conditions was 37 Megabits per Second (Mbps), while under non ideal conditions, was 32 Mbps; Upload speed was 10.6 Mbps. Speaking on the success of the trial, the Chief Executive Officer and Managing Director of Airtel Nigeria, Rajan Swaroop said Airtel is committed to strengthening its position as a true pioneer of innovation in the Nigerian telecommunications domain.

finance access.

Elibe said the facility will contribute significantly to the rural transformation agenda of President Goodluck Jonathan that was fashioned out in two programmes targeted at the youths and women to actualize their dream.

He said the Youths in Agricultural Revolution in Nigeria, YARN, initiative and Grow and Earn More, GEM, for women were aimed at using agriculture to create jobs and generate income for both youths and women, who are the most vulnerable to unemployment.

He noted that the agricultural sector, which had suffered serious neglect from successive administrations, has the capacity to transform the economic landscape of the nation, if properly harnessed and in turn check youths’ restiveness which has culminated to insecurity challenge in some part of the country.

The MD promised to strengthen and grow the new partnership between the bank and the state government in growing the SMEs with adequate micro credit facilities to empower the citizenry and expressed his readiness to explore other areas of possible collaboration.

22 — Vanguard, MONDAY, DECEMBER 17, 2012

Banking & Finance BRIEF Diamond Bank unveils instant account opening process rospective customers of Diamond Bank will henceforth enjoy instant account opening with the bank, as the bank has successfully implemented BPM (Business Process Management solution) from Newgen Software Technologies.

This implementation has enabled the bank in end-toend automation of the Account Opening and Account Management processes, which in turn would enable to provide improved customer service within shortest possible TAT (turnaround time).

On this occasion the bank also launched its latest innovation whereby the bank’s sales staff would be able to open accountsinstantly, using their Tablets. Diamond Bank becomes the first ever bank in Nigeria to provide this service.Speaking on the occasion, Dr.Alex Otti, Group Managing Director, Diamond Bank said, “This initiative further substantiates our position as a leader in retail banking. The implementation of Tablet based Account Opening reinforces Diamond Bank’s position as a innovator and a technology driven bank.”Speaking on the occasion also, Mr. Premier Oiwoh (Head IT & Operators, Diamond Bank) added “We chose Newgen based on its proven track record in the BPM space and its focus on African market. Based on our deliberation with various solution providers, we felt Newgen products and implementation pedigree met our needs perfectly.”

Speaking on the significance of this implementation, Mr. Vivek Bhatnagar (Vice President Newgen Software) said, “We are happy to partner with Diamond Bank, in its quest for transformation and achieving operational excellence. Newgen’s BPM offerings will help the bank to centralize the back-office processes, in a seamlessly automated environment.”

“It will also pave the way for faster customer acquisition and excellence in service delivery besides helping the bank reduce operating costs,” he added.

Mr. Bhatnagar also said that the implementation was delivered jointly by Newgen and its local partner FASYL Nigeria. He added that “ we, at Newgen, put strong emphasis on utilization of local resources in implementation and post implementation support phase.”

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NEXIM, Miners Association to boost investments in solid minerals STORIES BY BABAJIDE KOMOLAFE igerian Export Import Bank (NEXIM) and the Miners’ Association of Nigeria has put in place a framework to better structure and attract sustainable investments to the Solid Minerals sector.

The framework was the focus of deliberations during a meeting between the Managing Director/CEO, NEXIM Bank, Mr. Roberts U. Orya and the Patrons of the Miners’ Association of Nigeria at the NEXIM House in Abuja.

In a statement issued by the Corporate Communication Department of the Bank, the meeting with the Miners’ Association was essentially a gesture by its patrons to discuss issues of mutual cooperation with NEXIM as a follow-up to the interactive business dinner organised by the Association in conjunction with the Federal Ministry of Mines & Steel Development.

Presenting the Bank’s strategic initiative and market focus to the Association, Orya reiterated that Solid Minerals is a cardinal sector for the Bank under its MASS Agenda. Till date, the Bank has committed more than N2.5b or nine percent of its total portfolio since August 2009 to the sector.

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Pix From Left; Mr Jubril Aku, Managing Director Ecobank Plc, Mr Adebisi Shonubi, Managing Director Nigeria Inter-bank settlement system Plc, Mr Ejori Aror, Group Managing Director IPNX Nigeria Limited, and Mr Kingsley Umadia, Country Head Operation Technology Ecobank Limited, During the Lunching Nigeria Inter-bank settlement system e-bills payment in lagos on Thursday 13-12-2012. At Wheatbaker Hotel, Victoria Island Lagos PHOTO; Kehinde Gbadamosi

Orya, however, noted that this does not scratch the surface of the sector ’s requirement if Nigeria is to take advantage and benefit from the huge mineral deposits with which God has blessed the country. Solid minerals mining is a high capital intensive area and requires strong Government intervention to unlock its huge revenue and job creation benefits for the country.

In his response, the President of the Miners’

Association, Mr. Sani Shehu, thanked the NEXIM Bank management for its commitment and support to the members in the quest to open up the solid mineral sector. According to him, "the Association is overwhelmed by the passion of the bank for the growth of mining industry in Nigeria and for supporting the players in the industry to actualise their aspiration” He agreed with Orya that the slow development of the solid minerals sector is attributable to a number of

man-made and natural factors.Mr. Shehu stressed that the government needs to quickly harmonise its policies on mining to enable an investment-friendly environment. He also identified paucity of fund as a major impediment to the growth of the mining sector and requested NEXIM Bank, based on the commited support to the Association members thus far, to strengthen efforts to get the federal government to provide much needed funding to the industry.

Cashless: NIBSS unveils products to enhance bills payment he Nigeria Interbank Settlement System (NIBSS) has introduced two products to enhance cashless payment of bills in the country.

The products namely NIBSS e-Billspay and Automated Direct Debit (ADD) were introduced to the banking public last week in Lagos.

Managing Director/Chief Executive, NIBSS, Mr. Ade Shonubi said that with the introduction of the two products, customers of businesses can pay their bills from any part of the world.

He explained that the NIBSS e-Billspay is an account-number based, online real time credit transfer product that enables customers to make payments by leveraging the security provided by the Banks. “It

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enables Banks to provide electronic payment services through payment channels such as internet banking, mobile banking, Kiosk, while leveraging on the security measures provided by these channels with a view to making payments to signedup Billers”, he said.

He said that the Automated Direct Debit (ADD) is a cashless or electronic payment method of settlement of financial obligations and/or indebtedness on a reoccuring basis through authorisation to debit nominated bank accounts in any bank as agreed intervals. “The product subsists on duly signed mandate or authorisation to debit a nominated bank account”.

The two products, he said

are for Banks and customers of Banks, Insurance companies (for Premium), Utility companies (for bills), telecommunication companies (for post payment) and subscribers, prívate televisión subscribers, leasing companies (for lease rental), pension companies (for additional/voluntary contributions, clubs (for subscription payments) and others.

Explaining the rationale for and the benefits of the two products, Niyi Ajao, Executive Director, Technical Services, NIBSS, said, “Both of them are targeted at safe payment. If you look at our market today, it is very difficult to pay your bills in this country. If you want to pay your bill, atimes it takes two or three days before the

company you paid to will record your transactions. “If you go to many companies today, like Multi Choice, telcoms customer care centres, you see many customers going their to queue up to pay bills after queuing up at their ATMs to withdraw cash.

“What we have done is to package two products at the same time to help the public to pay their bills very conveniently, and most importantly to help companies who are providing services manage cash inflow.

Today, companies safe a lot of cost because our platform creates convenience for those who are paying bills and makes life very easy as it helps companies register their incoming cash on time.”

1.38

1.29 5.52 0.94 5.81 42.60

33.50 10.07

Livestock/Animal Specialities Livestock Feeds Plc

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

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

10.03 34.39 3.56 2.88

27.68 46.85

8.96 0.64 0.57 4.35 11.00 2.08 0.50 15.05 3.37 19.35 1.07 0.70 1.15 3.88 0.88 7.30 1.55 4.30 7.30 0.50 0.50 17.14

0.54 0.67 0.50 0.50 0.50 1.20 0.50 0.50 0.50 1.55 0.50 0.61 0.50 0.50 0.50 0.50 0.50 0.50 0.51 0.50 0.50 0.51 0.50 0.50 0.50 0.50 0.50 0.50

0.50 0.50

0.50 2.02 0.50

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

Personal/Household Products PZ Cussons Nigeria Plc Unilever Nigeria Plc

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

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

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

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

0.50 2.02 0.50

0.50 0.50

0.56 0.72 0.50 0.50 0.50 1.26 0.50 0.54 0.50 1.60 0.50 0.61 0.50 0.50 0.50 0.50 0.50 0.50 0.55 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50

8.95 0.64 0.55 4.62 10.90 2.30 0.50 15.08 3.21 21.50 1.07 0.70 1.15 4.10 0.88 7.30 1.68 4.55 7.37 0.50 0.50 17.97

27.05 47.00

10.03 34.39 3.70 2.88

29.00 710.00

0.50

27.30 650.11

Food Products-- Diversified Cadbury Nigeria Plc Nestle Nigeria Plc

7.93 5.81 65.00 2.04 6.50 0.64

0.50

7.75 5.75 66.00 1.99 6.20 0.67

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

44.00

4.70

40.00

Beverages-Non-Alcoholic 7-UP Bottling Company Plc

3.80 265.00 14.20 165.00 0.89

0.50

100.00

10.99

33.00 10.07

1.29 5.42 0.91 5.81 43.98

1.33

0.50 35.00 15.51

0.50

Closing Price (N)

5.19

3.80 230.19 13.60 140.28 0.89

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

0.50

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

100.00

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

10.59

0.50 34.00 15.21

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

Real Estate Development UACN Property Development

0.50

Oil and Gas and Products Petroleum Products Capital Oil Plc

Company

Opening Price (N)

Capital Market

12,000

3,011

100,000 60,000 220,660

500 15,000,000

3,214,003 108,380 12,500,000 91,000 200 633,158 20,000 62,500 2,000,000 1,698,475 200 1,172,778 116,666 1,670,890 435,600 1,000 1,000 100,000 9,672,100 50,070,100 188,070 1,458 6,066,500 95,604 55,000 115,000 500 1,304,000

2,496,551 646,608 13,287,533 11,819,184 2,026,821 6,017,178 1,000 16,944,327 3,624,146 17,883,119 56,000 73,200 91,000 2,514,665 1,006,032 173,300 5,297,600 12,666,309 639,097 40,000 3,700 6,646,870

219,286 844,112

225 320 124,500 12,400

609,354 241,510

384,751 1,733,611 142,351 1,274,320 2,259,880 164,877

19,949

50,000 367,805 90,961 2,747,884 1,000

6,500

2,000,000

199,408

24,906 10,000

9,092 264 21,843,712 100 687,112

56,682

200 86,648 167,159

5,000

Quantity Traded

0.50

10.54

0.61 2.02 0.66

0.50 0.50

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

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

43.50 31.25

15.58 42.66 6.75 3.67

29.20 470.00

19.90 16.20 95.00 6.60 6.70 0.88

0.50

9.52

0.50 2.02 0.50

0.50 0.50

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

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

27.00 22.56

12.71 36.19 4.78 2.66

10.17 367.83

4.31 4.02 57.00 2.31 3.80 0.50

,39.00

186.00 5.23 72.50 0.93

255.00 7.10 100.00 1.01 51.49

2.23

0.50

97.00

11.59

32.96 3.01

1.45 5.52 0.50 6.43 28.70

0.48

0.50 14.53 6.40

0.50

Year Low

4.63

0.50

100.00

20.15

62.26 8.28

2.54 8.28 1.82 7.60 42.50

0.66

0.50 24.58 8.30

0.50

Year High

0.00

0.00

0.00 0.00 0.13

0.02 0.00

0.05 5.85 0.00 25.00 0.00 0.22 0.00 0.00 0.00 0.08 0.00 0.00 0.00 0.02 0.00 0.01 0.03 0.10 0.37 0.14 0.02 0.06 0.04 0.10 0.00 0.00 0.00 0.00

1.42 0.00 0.00 0.90 2.81 0.43 0.00 2.03 0.00 2.10 0.00 0.18 0.00 0.71 0.47 0.47 0.54 0.67 0.00 0.00 1.34 2.09

0.70 1.44

3.90 1.61 0.54 0.00

1.35 25.43

0.00 0.91 4.09 0.39 1.01 1.13

2.69

9.95 0.41 5.08 0.00

0.00

0.00

11.75

1.69

4.11 4.73

0.16 0.35 0.24 0.26 6.89

0.11

0.10 7.33 2.75

0.09

E.P.S.

0.00

0.00

0.00 0.00 16.67

0.00 0.00

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

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

20.93 20.46

3.26 22.48 7.34 0.00

37.57 27.96

16.91 14.38 16.89 16.92 5.75 8.83

13.92

19.98 16.29 22.22 0.00

0.00

0.00

8.51

7.33

10.11 2.26

5.18 15.77 3.64 20.74 4.14

15.00

50.00 2.77 4.37

P.E. Ratio

0.50

Processing Sysetms Chams Nigeria Plc

0.50

4.90 2.60 5.78

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

0.50

2.43 1.81 4.20 4.19 Road Transportation Associated Bus Company Plc

0.50 Printing & Publishing.

Academy Press Plc Learn Africa Plc Longman Nigeria Plc University Press

6.50 0.99

0.50

3.03

1.97 1.41

Media/Entertainment Daar Communications Plc

Hotels/Lodging Capital Hotel Ikeja Hotel Plc

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

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

Afromedia Plc

SERVICES

0.50

20.50 0.50 18.69 1.32 8.84 115.00 26.32 124.68

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

0.55 11.85

Intergrated Oil and Gas Services Oando Plc

3.98 10.50 13.28 4.30 1.05 2.92 0.66

INDUSTRIAL GOODS Packaging/Containers Abplast Products Plc Beta Glass Co. Plc Greif Nigeria Plc Nampak Nigeria Plc Poly Products (Nig) Plc Studio Press (Nig) Plc W.A. Glass Ind. Plc OIL AND GAS Energy Equipment and Services Japaul Oil & Maritime Service

1.44 0.50

Mortgage Carriers, Brokers and Se Abbey Building Society Plc Union Homes Savings and Loans

1.52 0.50

1.38

Paper/Forest Products Thomas Wyatt Nig. Plc

Electronic and Electrical Products Cutix Plc Nigerian Wire & Cable Plc

0.50

10.55

Non-Metalic Mineral Mining Multiverse Plc

5.97

Metals Aluminium Extrusion Ind Plc

8.26

1.99 2.31

19.28 8.41 26.94 4.92 121.05 0.50 3.45 58.10 3.71 1.98 10.93

NATURAL RESOURCES Chemicals BOC Gases Plc

Tools and Machinery Nigerian Ropes Plc

Packaging/Containers Avon Crowncaps & Container Nigerian Bags Manufacturing Company

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

0.50

0.50 14.40 2.41

IT Services NCR (Nig) Plc Tripple Gee and Company Plc ICT Telecommunications Starcomms Plc

0.50

Computers and Peripherals Omatek Ventures Plc

5.05 1.20 1.02 45.50 1.46 0.92 8.17 2.73

ICT Computer Based Systems108 Courteville Investment 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

Opening Price N

3.59 5.59

4.90

0.50

1.79 1.83 4.20 4.70

0.50

6.60 0.98

0.50

2.99

1.97 1.45

0.50

0.50

20.50 0.50 20.05 1.92 8.00 109.25 23.76 121.68

14.03

0.59

3.98 10.50 12.98 4.30 1.05 2.78 0.66

1.44 0.50

1.52 0.58

0.50

1.38

0.50

10.55

5.68

7.85

1.99 2.30

18.00 8.41 28.00 5.40 121.50 0.50 3.11 60.00 4.17 1.89 10.93

0.50

14.40 2.29

0.50

0.50

5.05 0.95 1.00 45.00 1.57 0.87 8.17 2.73

Closing Price N

83,654 2,613,507

20

12,000

237,156 75,996 4,322 50,000

37,500

800 275,735

20,000

256,815

240 149,100

150,000

50

82,191 1,000 90,145 618,110 170,389 22,711 2,690 85,191

5,617,088

1,113,783

6,888 67,559 11,087 29,198 200 84,311 2,749,340

2,000 1,000

15,000 15,000

200,000

1,000

8,001,000

5,000

32,216

10,000

390 1,010,000

167,529 10,000 113,632 865,560 175,575 10,374 4,066 509,461 203,920 100,000 1,000

2,307,692

8,367 2,096

100,000

350,000

1,000 38,000 2,680,000 390,915 130,380 25,640 29,000 300

Quantity Traded

2.78 11.75

5.15

0.80

1.57 6.50

4.90

0.50

3.17 4.60 3.60

3.68

0.48

3.00 1.33

0.90

2.65

1.97 1.30

8.00 6.82

0.50

400 2.07

1.64

3.67

4.33 3.65

0.72

0.51

141.00 63.86 195.50

163.50 2,100 240.00 6,000

0.50 0.50 5.71 3.89

27.99

0.87

3.98 12.71 13.97 3.60 1.05 2.92 0.63

1.33 0.50

1.62 2.58

0.50

1.38

0.50

10.70

6.80

8.26

5.94 1.47

12.00 8.10 15.16 4.16 95.00 0.50 1.02 36.58 5.11 0.51 10.93

0.50

3.25 3.25

0.50

0.50

5.31 0.70 0.83 2.58 3.61 0.95 0.95 4.28

Year Low

37.10 0.70 32.60 5.59

78.97

0.97

3.98 15.58 15.03 4.30 1.86 2.92 0.63

1.51 0.99

2.50 2.58

0.50

1.38

0.50

12.39

9.20

8.69

6.91 3.60

30.00 12.57 43.98 15.49 132.51 0.75 3.51 48.05 5.28 3.36 13.40

1.47

9.31 3.59

0.50

0.52

5.31 1.45 3.20 23.11 5.61 1.96 12.91 200

Year High

0.60 12.53

0.00

0.00

0.25 0.30 0.00 0.54

0.00

0.34 0.92

0.04

0.60

0.00 0.21

0.00

0.01

6.11 2.98 14.63

4.93 0.00 4.25 0.61

1.73

0.19

0.00 3.90 0.90 1.22 0.30 0.07 0.00

0.03 0.00

0.11 0.00

0.00

0.00

0.01

0.13

0.78

0.00

0.5 0.25

2.14 1.09 2.28 1.47 7.56 0.00 0.00 4.10 0.44 0.23 0.00

0.00

0.00 0.01

0.00

0.10

0.19 0.44 2.62 0.20 0.09 0.00 0.00

E.P.S

4.22 8.75

0.00

0.00

0.00 27.69

12.19

0.00

34.09 2.12

11.25

4.91

0.00 8.19

12.75

11.11 19.23 17.07

6.99

7.40 0.00

4.17

6.06

0.00 3.26 0.00 3.52 6.18 41.71 0.00

28.80 0.00

13.15 0.00

0.00

0.00

0.00

85.77

7.37

0.00

39.60 9.16

7.86 4.97 8.88 2.31 13.17 0.00 0.00 42.86 14.19 2.89 0.00

0.00

1.43 0.00

12.50

10.00

9.05 14.13 0.00 0.00

88.50 0.00 3.07

P.E Ratio

Stock Market Report as at Friday, December 14, 2012

Vanguard, MONDAY, DECEMBER 17, 2012 — 23

C M Y K

24 — Vanguard, MONDAY, DECEMBER 17, 2012

Corporate Finance

Minister calls for long term bond, single digit interest rate to fund agric

BY BABAJIDE KOMOLAFE

M

inister for Agriculture, Dr Akinwunmi Adesina has called for the issuance of long term bond to provide loans to farmers at single digit interest rate.

He made this call at a workshop on “Financing the Agricultural Revolution” organised by the Securities and Exchange Commission (SEC) held in Lagos on Friday.

Adesina said that the ongoing transformation in the nation’ s agricultural sector has created huge demand for affordable funds, which exceeds what can be provided under NIRSAL. “Today there is a positive investment climate for investment in agriculture in Nigeria. The sector however needs long term finance at single digit interest rate but it offers potential interest rate income of about N400 million to investors.

He said for example the Ministry is about to introduce a scheme to raise 760,000 young commercial farmers in the next five years, and the funding requirement for the scheme is about N3 trillion. He said that research studies show that the Nigeria agricultural sector has a potential of $99 billion and this is expected to increase to $250 billion in the next 2020 years.

He said that in recognition of the potential of the sector, there has been increased private sector participation in recent times, with over $8 billion attracted in the last one year, with the World Bank alone offering funding support of $500 million, and the African Development Bank (ADB) pledging $250 million.

Similarly, banks’ lending to the sector has improved from one per cent of total lending to three per cent in recent times.

He said that despite these, the funding needs of the sector is far from been satisfied. “This requires that we think out of the box. We need to raise long term bonds

to support the agricultural sector.

The Asset Management Company of Nigeria (AMCON) and Pension Funds Administrators (PFAs) should invest in agriculture to provide long term funds at single digit interest rate.”

He said that the Ministry on its part has commenced

moves to facilitate long term funds to the sector. The Ministry, he said, has set aside $3 million to set up a venture capital company to lend to seed companies and as time goes we would add another $3 million. “And we are also attracting other investors so that we can grow the fund to about $20 million

to provide funding support to seed companies. They don’t have to go to banks to get access to financing to get processing equipment.”

He disclosed that in addition to this, the Ministry is working with the Tony Elumelu Foundation to set up an apex fund for agriculture in the country.

“Furthermore the President, just two weeks ago, directed that the Bank of Agriculture be restructured and recapitalised to lend at single digit interest rate.

NSE Index records six week high, as shares’ value rises by N324bn

By CHINEDU IBEABUCHI

A

ll-Share Index of the Nigeria Stock Exchange rose to a six week high last week while total value of shares rose by N234 billion in response to five days of uninterrupted profit making on the Exchange. Analysts at Proshare, an Investment Company, said the outlook in the last seven days revealed sustained and significant increase in risk appetite as they had recently observed gradual and consistent growth in cautious and value trading towards more active C M Y K

stocks across the board.

Specifically, the key market indices represented by the All-share Index and the Market Capitalisation both rose by 3.80 per cent each during the week.

The Market Capitalisation gained about N324 billion to close at N8.846 trillion from N8.522 trillion; while the AllShare Index appreciated by 1,013 points to close at 27,685.54 from 26,671.72 points.

A review of the equity price movements indicated that forty four (44) equities recorded price appreciation while twenty-five (25) equities recorded price declines and prices of one

hundred and twenty-nine (129) equities remained constant. When compared with the preceding week, thirty five (35) equities gained while thirty- one (31) equities recorded price declines and prices of one hundred and thirty-two (132) equities remained constant.

Nestle Nigeria Plc led in the gainers chart, appreciating

by N49.95 to close at N710.00 per share from N660.05 per share. It was followed by Guinness Nigeria Plc which rose by N23.90 to close at N265.00 per share, while the Nigeria Breweries Plc gained N21.45 to close at N165.00 per share, among others.

On the contrary, PZ

Cussons Nigeria Plc led in the losers’ chart, depreciating

by N1.95 to close at N27.05 per share from N29.00. It was followed by MRS Oil Nigeria Plc, which lost N1.25 to close at N23.76 per share and DN Meyer Plc which declined by N0.75 to close at N2.05 per share, among others.

Meanwhile, a turnover of 1.929 billion shares valued at N14.640 billion in 22,650 deals was recorded last week in contrast to a total of 1.144 billion shares valued at N11.239 billion that exchanged hands in 18,947 deals penultimate week.

The Financial Services sector (measured by turnover volume) accounted for 1.573

billion shares valued at N10.547 billion traded in 14,207 deals.

The Conglomerates sector followed with 131.812 million shares valued at N180.812 million traded in 765 deals.

Linkage Assurance Plc was the most active during the week (measured by turnover volume); with 218.466 million shares, followed by Zenith Bank Plc and Transnational Corporation Of Nigeria Plc .The top three equities with a total volume of 564.997 million units of shares contributed 29.29 per cent and 27.99 per cent respectively to the total turnover and value for the week.

Vanguard, MONDAY, DECEMBER 17, 2012 — 25

C M Y K

26 — Vanguard, MONDAY, DECEMBER 17, 2012

C M Y K

Vanguard, MONDAY, DECEMBER 17, 2012 — 27

Housing Finance

Law maker blasts NHF over poor housing delivery STORIES BY MIKE EFFIONG

T

he Chairman House Committee on Housing, Hon Usman Aminu, has lashed out at the National Housing Fund saying it is not working as regards housing delivery in the country.

“Since I assumed office as the chairman of this committee, I realised that NHF is not working .Why is it not working? Let’s team up and collaborate and see how it can work. From what I understand about NHF, any Nigerian can contribute part of his income so that he can reap or access housing in life time."

Speaking at the official commissioning of Emerald court in Abuja, he noted that the essence of fund is to encourage saving to access houses much later in life has so far not been achieved.

Aminu pointed out that it was pertinent for developers to consider building houses for the masses, as having shelter could address the problem of insecurity and provide employment.

“But the participants, especially most of you from banks are not doing their jobs.

That is why the fund is not optimum and it needs to be

optimum so that at level of social housing, we will be able to do something”, he said, He emphasised that most of the houses being built by developers are accessible by high income earners, while low income earners find it difficult to access the houses, saying that in every society, the middle-class make possible for the society to be at peace with itself but in Nigeria, we are yet to appreciate that. "Please let’s

come together and collaborate and see what can be done.”

He stressed that the committee had passed a bill on building collapse, which he hoped would see the light of the day and that professionals would submit the code.

Also the Minister of Federal Capital Territory, Senator Bala Mohammed, stated that providing result oriented houses could curtail rising cases of youth restiveness,

insecurity amongst other.

Mohammed who was represented by the Perm Sec, Engineer Anthony Ozodinobi stated that “ In order to arrest the increasing gap on the demand and supply of housing for the teaming population of Abuja in particular and Nigeria in general, the government and all its agencies, private and public organisation must step up on all machinery that is meant to deliver the goal”

From right Mr Sunday Sopitan, Human Resource Manager, Honeywell Superfine Foods Ltd; Mr Leye Adegboyega, Unit Commander RS 2.17, Ojota; Mr Lanre Jaiyeola, Commercial Director, Honeywell Superfine Foods Ltd and Regina Peter, Unit Head of Education RS 2.17, Ojota at the HSFL-sponsored FRSC 2012 ember months road show campaign in Lagos on Thursday.

Photo by Lamidi Bamidele.

Estate developers vow to resist Abuja estates' demolition

R

eal Estates Developers Association of Nigeria (REDAN) has vowed to resist further move by the Minister of Federal Capital Territory, Senator Bala Mahommed,to carry on with the ongoing demolition, stating that further demolition could precipitate huge crisis in the housing sector. Reacting to the legal tussle over the demolition of N3billion Minanuel Housing Estate, the Minister told the Senate committee on FCT that there was no going back on plans by the Development Control Department of the administration to demolish 31 housing estates, which according to REDAN, is worth N37.82billion.

A report by REDAN, inhouse committee on verification of Documents submitted

by Developers along Lugbe / Airport Road axis of FCT, has also put the total number of houses under construction at 4,961 with over 17,323 subscribers. The total area is also estimated at 2.990.9 hectares.The president of REDAN, disclosed this in Abuja, called on President

Goodluck Jonathan to stop the Minister from going ahead with the planned demolition, adding that the moves would have serious effect not only in the Nigeria economy, but also the nation’s security.Afolayan

stated “the closure of Dangote cement factory in Gboko, Benue State may have been as a result of the directive by REDAN that developers should stop further construction.”

He called on the federal government to act fast in order to prevent the kind Mortgage crisis that ravaged the United State of America, emphasizing, that the whole world is still feeling the effect.

Jubilee-life Savings begins operation as primary mortgage bank

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ubilee-Life Savings and Loans has began operation as Primary Mortgage bank in Lagos and Federal Capital Territory.

This was disclosed by the Chief Executive Officer of the company; Mr.Wale Osissanya. He said that money spent on property development has produced the best result, even as the company has begun operating as National Primary Mortgage bank in Lagos and Federal Capital Territory.

“We leveraged on the robust income on property development to achieve the results all these years.Howerve, with the new regulation of Central Bank of

Nigeria (CBN) to capitalize to the tone of N5billion, we are under some kind of restraint continuing with the wonderful strategy, but we are working relentlessly to ensure smooth transaction in order to comply with the directive of CBN with effect from 2013” he said.

He added “The outlook in the year ahead would be quite challenging for Nigeria bank industry after capitalization directive by CBN.He pointed out that the roadmap to become a benchmark for operating Primary Mortgage Banks in the country entails effective service delivery through development and efficient loan and capital to penetrate and strengthening their position corporate in the

market place.

Osisanya, noted that the company has achieved a modest profit before tax of N252.610, 034 against N252.032.148, recorded in the profit.

Speaking at 8 th Annual General meeting of the company, Chairman of the company, Mr. Felix Ohiwerei, explained that despite the funding challenges confronting the sector over the year, the company has been able to forge ahead.

He said that construction works in its whispering Palms Estate, Port Harcourt had been sold out works are at advanced stages on its Gloryland Estate in Port Harcourt and another

BRIEF GTBank, Selfridges boost African designers

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uaranty Trust Bank Plc has launched its partnership with Selfridges, UK to project designs by African fashion designers. The collaboration tagged “Guaranty Trust Bank presents Ndani”, stems from the Bank’s commitment to the projection of African Art to global audiences.

Ndani represents the beauty of Africa and this is clearly demonstrated at a distinct pop-up shop in Selfridges’ departmental store on Oxford Street in the UK. The designs on display at the shop express the deep creativity, ingenuity and originality of African designers, attributes which the designers share with the GTBank brand.

The exhibition has already attracted several reviews and visits by fashionistas from all over the world and is set to be a high point at the store throughout December 2012 and January, 2013.

Participating designers are from Nigeria and include: Agu, House of Silk, DOT Handbags, Odio Mimonet, Lanre Da Silva Ajayi, Jewel

by Lisa, Eki Orleans, Ituen Basi and Tiffany Amber. These designers are showcasing their Christmas/Cruise collection exclusively at the Nigerian world pop-up store during the project.

Company warns against sand scooping, erection of structures under electricity he Transmission Company of Nigeria has warned residents against erecting illegal structures and scooping sand under transmission towers and electric poles. Mr Olushola Akinniranye, its Chief Executive, gave the advice in an interview with the News Agency of Nigeria (NAN) on Thursday in Lagos. He said that the company would prosecute anybody found engaging in such acts. He said that continuous scooping of sand under PHCN’s transmission towers could cause collapse of the towers.

The company executive urged perpetrators to stop scooping for sand around electric poles or trading under electric cables as they were endangering their lives by such acts. He said that demolition of illegal structures under transmission towers and electric poles would soon begin across the country.

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28 —Vanguard, MONDAY, DECEMBER 17, 2012

Interview

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Johnson Chukwu, is the M a n a g i n g Director/CEO, Cowry Assets Management Limited, an Investment Bank and key player in the capital market with specialisation in Oil and Gas, Bonds and Equity and other financial instruments.

In this interview with Financial Vanguard, Chukwu stated that reduction in recurrent expenditure will take a gradual process. He assrted that cutting down on people’s salaries without rationalisation of agencies of government with overlapping functions will be difficult.

What is your take on the 2013 budget being debated by the National Assembly and the federal government and how detailed do you think the 2013 budget is in relation to that of 2012?

Well, I will I say that the budget is quite detailed enough and it is in tandem with the medium term expenditure framework of the country, and it actually recognises the peculiarities and needs for the economy to grow, while at the same time maintaining some level of fiscal stability. If you look at the budget, you see a revenue growth of 39 percent and expenditure of about five percent. that shows that the government revenue is actually growing faster than the federal government expenditure. You also saw the structure of the recurrent expenditure to capital expenditure now moving towards a higher level of capital expenditure. We are moving from a capital expenditure of about 28.7 percent to 31.3 percent capital expenditure as against recurrent expenditure of the country. We are also seeing a reduction in borrowing from N744 billion to N727 billion for the 2013 budget. If you look at the revenue side, you see that revenue is actually predicated on oil benchmark of 25 dollars, oil production of 2.53 million barrels per day. If you compare that to about 2.48 million barrels per day which was the benchmark for 2012, that gives us a marginal increase in terms of production volume. If you also compare it with 75 dollar per barrel to the 82 dollars we had for 2012, which was also a marginal increase. So, if you look at the revenue projection, one will say that the projections are quite conservative, but quite realistic. If you look at the structure on which bulk of the capital expenditure is based, you see some improvement.

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So, give and take, I think the budget looks reasonably well designed.

Looking at the allocation to some of the basic sectors, do you think the implementation will deliver the needed development in the country?

Well, you have to look at the budget in terms of changes in value chain of some of the sectors of the economy. Take for instance, the agricultural and power sector, you see the agricultural sector has moved away from a government driven, fertilizer distribution system to a private sector business oriented value chain.

So, that simply means that the amount of money that will go into government funding of agriculture also will be reduced because the private sector actually taken the role that government used to play and is actually playing it effectively. So, you don’t expect the government to really throw in so much money into the agricultural sector; what they have really done is to redefine and redesign the

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By NKIRUKA NNOROM

value chain and make it private sector driven. If you look at the power sector which has a budget of about N78 billion, you also recognise that come the end of October, both the distribution companies and generation companies would have been sold to the private sector. So, further investment from federal government to that sector will largely be restricted to the transmission grids, so you are not going to see a lot of government resources being thrown into that sector, what government is going to do is to drive those sectors through policies and regulations. The same thing apply to a lot of other sectors that are actually major drain in the public resources but if you look at those social infrastructure, which is what the government should do, what we call common good or public good, you see that their share of the budget is quiet substantial. If you look at education, education has the highest share of the budget. I think about four hundred and

It does not make sense for Nigerians to be sending their children to Ghana to go to higher institution. So, I think the federal government wants to actually turn around the educational sector if you judge that based on the amount that was voted for the educational sector.

Johnson Chukwu, MD/CEO, Cowry Assets

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eighty something billion naira followed by the Armed Forces and the Police which is security. Between the Armed Forces and the Police we have about N670 billion. You find out that those are the public goods which the government wants to invest in. If you look at the educational sector, we have a huge young population and you see the complaint of the quality of education. I think what the government wants to do is to strengthen the quality of instruction within the educational system and also strengthen the level of infrastructure in the tertiary institutions, so that Nigerian graduates will begin to compete with their contemporaries in other countries. It does not make sense for Nigerians to be sending their children to Ghana to go to higher institution. So, I think the federal government wants to actually turn around the educational sector if you judge that based on the amount that was voted for the educational sector. The other major thing is the financial sector, of course, that cannot be understated. Like I said, these are social infrastructures, social services that the government is putting more resources into. Those sectors that can be successfully driven by the private sector the government is slowing down or reducing the amount of vote going into those sectors. So, if you ask me, I will say in terms of allocation, the budget makes a reasonable sense.

So for you the allocation made to the agricultural sector is good enough?

Yes, that is why I said that the value chain has completely changed. In the past the government will purchase fertilizer and distribute, that alone the government is concerned will never get to the farmers. Now the management has changed to the private sector operators; government is rather encouraging commercial agriculture through the commercial agriculture credit scheme. Government is encouraging small holder farmers through electronic distribution of fertilizer, so the government does not necessarily need to buy or subsidize those products and supply free to the farmers because eventually , those products will not get to the farmers they are subsidizing it for. So the amount of money we needed to put in driving agriculture has drastically been reduced because of the fact that the agricultural production are now being driven by the private sector

Major foc budget is of public/ good —Jo

Johnson Chukwu ...is the governm operators unlike what used to happen in the past, and that is why the amount of vote is sufficient. We also need to also recognise that there have been a lot of changes in terms of the environmental factors over the past couples of weeks, particularly due to heavy rain and flooding in some part of the country, which may adversely affect agricultural production. That may as well entail additional resources going in to support farmers, but the government has also said that the resources required to support or to reverse the damage done by the high level of flooding is beyond the government capability, and the government is also seeking the private sector and even international donor agencies to support in addressing the damages or losses suffered in the agricultural sector, including the housing and other sectors as a result of the flood. I think the Dangote team said they are going to raise about N100 billion to support those who are affected by the flooding. I believe a large part of the fund will also go into helping them to restart their life, and also helping them to re-plan their course. The Minister of Agriculture has also come up to say that, they are going to distribute to them cereals that have very short life cycle and those cereals will include maize and those things that have maturity period of about six months. So hopefully, with these initiatives I think that will moderate the impact of the flooding and that

Vanguard, MONDAY,DECEMBER 17, 2012 — 29

Interview

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ocus of 2013 is promotion c/common

—Johnson Chukwu

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agencies that h a v e overlapping functions?

This is more of a political question, but the way I will look at it is that the government has said they will do it; it is now left for us to watch them do it.

In a democratic dispensation, t h e government’s job is to create employment and not to drive unemployment.

S o , rationalizing and eliminating ministries and agencies will

vernment having the will power for jobs or to rationalize agencies will not necessarily require so much funds from the government. Give and take, I think that is what the government is recognising that, and government has also set up committee to raise additional fund. To date, I think the government has raised up to about N17.9 billion for the affected states and communities and if the Dangote committee is able to raise up to N100 billion as they promised, I think we should have enough resources without necessarily worrying the government to come up with a supplementary budget to support agricultural production.

Some people still believe that five percent reduction in recurrent expenditure is not enough, they still believe that government should cut down on its expenditure. What is your take on that?

The way I will look at it is that the government will have to improve on infrastructure; there are infrastructural problems and structures are not erected over night. The government has said that come 2013, they will start rationalising agencies and ministries with overlapping functions. That simply means that until the rationalization is done, you cannot drastically cut off the salaries of those who are being paid. You can’t cut off their running cost; you don’t just eliminate costs that are borne by the specific structures. So, it will take some time. You need to reverse those structures, you need to amend, and

The government has said that come 2013, they will start rationalising agencies and ministries with overlapping functions. That simply means that until the rationalisation is done, you cannot drastically cut off the salaries of those who are being paid.

you need to eliminate those imbalances before you can see a drastic reduction in the recurrent expenditure. We have to realise that it cannot happen over night; it is a gradual process. We are moving from 28 percent capital expenditure share to 31.3 percent share. Hopefully by next year, we are going to be talking about 40 percent, or may be 38 percent or more, but a lot of other things will have to precede drastic changes in our expenditure profile and those conditions will include eliminating duplications in government agencies and ministries. Until that one is done, we cannot just cut

We are a monolithic economy; we export only one product and unfortunately for us, the product we export has a lot of volatility in its price.

Oil price has dropped sometime in 2008 to as low as $38 US dollars from $147 dollars per barrel. We have seen oil price dropped to $10 dollars in the past;

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salaries of workers, you will not just cut power supply from ministries and departments, you will not cut off their telephone bills, their fuelling allowances/expenses and all the rest. Those things will continue to run until those ministries, agencies and departments are eliminated.

So for m e, my expectation is that it will be a gradual process. Once the heads that are consuming those overheads are eliminated, the overheads will go down.

From the body language of this administration, do you forsee the government collapsing some of these

require the government eliminating jobs. Having said that, you will also recognize that it will be difficult decision granted that if this is done properly, and the economy stimulated to grow, those who will lose their job in government agencies will likely get better job in the private sector as long as they are competent. If you ask me, the question should be, is the government having the will power to eliminate jobs or rationalize agencies and ministries? I will say it is left for us so see. I want to believe that having said this, that they will start that in 2013 and that we should wait till 2014 to see a manifestation in the reduction of our current expenditure. I think we should rather give them the benefit of doubt and watch them do that.

What is your take on the argument that ensued between the National Assembly and Executive on the issue of crude oil benchmark?

My take on this is that the two sides had strong argument, but I will rather support the government against the National Assembly for certain reasons. One is that we are a monolithic economy; we export only one product and

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unfortunately for us, the product we export has a lot of volatility in its price. Oil price has dropped sometime in 2008 to as low as $38 US dollars from $147 dollars per barrel.

We have seen oil price dropped to $10 dollars in the past; there is nothing that can stop the oil price from falling at any point in time, but beyond that, let us even agreed that the oil price do not drop. We have two factors that make it imperative that we adopt a conservative approach in estimating the price at which we convert the oil production. One of these factors is the need to save and to build our foreign reserve.

The higher our foreign reserve is the stronger our economy becomes attractive to foreign investors, the more inflow we will have, and if we address the other structural challenges of power supply and security, you will find out that with a population of about 160 million people, this country will become a natural environment and point of attraction to companies that are into the manufacturing of consumer goods. Also, they will be encouraged to do that if we have strong foreign exchange reserve. So your foreign reserve will help us to also strengthen the value of the naira vis-a-viz other currencies. Another factor is this, because of the structure in the economy, which is such that we export products that have very low local production cost and convert the profits into local currency; the ability of our economy to absorb huge fiscal government expenditure will be highly limited. So, the implication of this is that if we convert all oil sales to naira, as the crude price the National Assembly is taking about $80 dollar per-barrel, we may actually have to contend with the issue of inflation, because the production of those goods we tend to export are very low in terms of local cost of production. So, you will be exporting something that cost almost nothing and you are importing the proceeds and converting to the local currency, so, we have a lot of local currencies that will be pursuing few goods.

30 — Vanguard, MONDAY,DECEMBER 17, 2012

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Vanguard, MONDAY,DECEMBER 17, 2012 — 31

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32 — Vanguard, MONDAY, DECEMBER 17, 2012

Insurance BRIEFS Pix caption L-R, Kenny Borisade, Chief Business Analyst North Waterloo Farmers Mutual, Insurance Co. Canada, NWFM, and spouse, Dolly with Mrs. Lana Rodrigues & Mr. Carlos Rodrigues, President & CEO NWFM at the company’s Xmas party/dinner in Ontario, Canada.

Insurers to lobby government on bail-out options

By ROSEMARY ONUOHA Insurance companies under the auspices of the Nigerian Insurers Association, NIA, are set to lobby the federal government to put machinery in place for possible bail-out options for distressed insurance companies.

The newly inaugurated Chairman of NIA, Mr. Remi Olowude, who stated this in Lagos said that government has always ignored insurance companies even when they are in trouble.

Olowude said “Insurance companies are institutional investors which invest in equities and securities. When these entities fail, insurance companies are faced with the challenges of honouring their obligations to their customers, but unfortunately, there is nothing in place on the part of the government to bail out the insurers in times of trouble. This is food for thought.”

Olowude said that efforts would be made to ensure the restructuring and strengthening of the association’s secretariat for effective public sector liaison and monitoring of the political and legal environment as it affects insurance, adding that this has become necessary as recent events in the financial sector have shown that no insurance company was too big to fail or too small not to matter.

To this end, Olowude said that the NIA hopes to seek an audience with the Presidency to table issues such as the key roles of insurance to the socioeconomic growth and development of the nation.

Olowude said in line with the association’s determination to achieve its mission and objectives, it has become imperative to take deliberate steps towards closer interaction and strategic partnership with all stakeholders, particularly the major arms of government Executive, Legislature and the Judiciary.

He noted that towards this end, the Governing Council of the association will consider seeking an audience with the Presidency to table issues such as the key roles of insurance to the socio-economic growth and development of the nation.

He said insurance industry and the government can collaborate in areas of poverty alleviation, to give the industry the opportunity to contribute to the formulation of certain government policies and representation in appropriate

L-R, Kenny Borisade, Chief Business Analyst North Waterloo Farmers Mutual, Insurance Co. Canada, NWFM, and spouse, Dolly with Mrs. Lana Rodrigues & Mr. Carlos Rodrigues, President & CEO NWFM at the company’s Xmas party/dinner in Ontario, Canada.

Insurers to lobby government on bail-out options

By ROSEMARY ONUOHA

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nsurance companies under the auspices of the Nigerian Insurers Association, NIA, are set to lobby the federal government to put machinery in place for possible bail-out options for distressed insurance companies.

The newly inaugurated Chairman of NIA, Mr. Remi Olowude, who stated this in Lagos said that government has always ignored insurance companies even when they are in trouble.

Olowude said “Insurance companies are institutional investors which invest in equities and securities. When these entities fail, insurance companies are faced with the challenges of honouring their obligations to their customers, but unfortunately, there is nothing in place on the part of the government to bail out the insurers in times of trouble. This is food for thought.”

Olowude said that efforts would be made to ensure the restructuring and strengthening of the association’s secretariat for effective public sector liaison and monitoring of the political and legal environment as it affects insurance, adding that this has become necessary as recent events in the financial sector have shown that no insurance company was too big to fail or too small not to matter.

To this end, Olowude said that the NIA hopes to seek an audience with the Presidency

to table issues such as the key roles of insurance to the socioeconomic growth and development of the nation.

Olowude said in line with the association’s determination to achieve its mission and objectives, it has become imperative to take deliberate steps towards

closer interaction and strategic partnership with all stakeholders, particularly the major arms of government Executive, Legislature and the Judiciary.

He noted that towards this end, the Governing Council of the association will consider seeking an audience with the Presidency to table issues such as the key roles of

insurance to the socioeconomic growth and development of the nation.

He said insurance industry and the government can collaborate in areas of poverty alleviation, to give the industry the opportunity to contribute to the formulation of certain government policies and representation in appropriate government committees; among others.

“Similarly, we intend to initiate interactive sessions with the appropriate committees or organs of the two chambers of the National Assembly to discuss issues such as restrictive laws on insurance practice, multiple taxation, insurance awareness and penetration, development of oil and gas industry.

“The NIA will equally strengthen relationships with the different organs of the Judiciary by organising annual or bi-annual insurance seminars for judges and the leadership of the Nigerian Bar Association.

“The seminars will focus on developments in insurance law in Nigeria, and ensure that the judiciary, legal profession, the regulators, and practitioners in the insurance industry as well as the media have a mutual understanding of insurance law and practice. The more people understand the law, the less the courts are inundated with avoidable suits.”

CIIN inducts 150 members C

hartered Insurance Institute of Nigeria, CIIN, has boosted its human capital development with the inauguration of 150 associate members.

Mr. Wale Adetimehin, President , CIIN, in his address during the Institutes’ 2012 Graduation and Fellowship awards ceremony held in Lagos, said the institute demonstrated its commitment to the actualisation of its three-tier examination structure which allows qualifiers at each level of the examination to obtain a certificate of completion.

He said that this no doubt, is a flexible and learnerfriendly examination structure geared at motivating greater interest in the attainment of professional qualification in order to address the industry human capital needs.

He said the Institute is conscious of the Industry post consolidation challenges which came with new and

complex human capital needs.

According to Adetimehin, the challenges facing the industry today not only require a fresh impetus in human capital development but also a renewed vigour and approach to skills recreation in order to equip practitioners for the huge tasks of managing the current realities in the business landscape.

He maintained that the Institute will continually strengthen the examination system through regular review of the syllabus and examination structure, as it is conscious of the Industry post consolidation challenges which came with new and complex human capital needs He added that the attainment of professional qualification should not be seen as an end in itself but as a means to an end, as it therefore behooves all holders of professional qualifications to be mindful of the efficacy

of Continuous Professional Development (CPD).

He further stated that the CPD has become institutionalized with varying degrees of enforcement by most profession, which in its case, it engenders a scheme which requires all members to locate themselves in the point scoring index.

He said “Hence it is referred to by our Institute as the Mandatory Continuous Professional Development (MCPD) programme, no professional should exempt themselves from this scheme under any guise,the MCPD is, unarguably, an inalienable part of our professional development and should be treated as such.”

He disclosed that the Institute’s College of Insurance project has continued to progress as planned, the College will be flagged off officially during the first quarter of 2013.

Vanguard, MONDAY, DECEMBER 17, 2012 — 33

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Is Nigeria missing the age of aviation?

“Things are not always what they seem”.

Anonymous Russian Jewish Writer. sk any Nigerian if we have airlines in Nigeria and he would probably answer “yes”. And for good measure, he will list the names of existing airlines – Arik, Aero Contractor, IRS, DANA (it is still in business and we need DANA more than it needs us; believe me), Overland, Medview (which started operations in November this year) and that is almost the entire list – for a nation of 167 million people and suffering from delusions of grandeur by aspiring to become one of the top twenty economies in the world by the year 2020. Incidentally, the second largest domestic airline is “Presidential Airways”, owned and managed by the President of Nigeria and our Ogapatapata, Goodluck Jonathan, CGFR. That airline has a fleet of ten crafts to its credit and has never, and will never make a profit for its owner. In fact “Presidential Airways” demonstrates all that is wrong with the Nigerian aviation sector and mostly explains why we are missing out in the Age of Aviation. Because it has never, and will never be subjected to the discipline of adequate profit, the calculation of returns on investment, as well as other parameters governing investments in the private sector, globally, it can only end up being a loss leader.

Procurement, operation and maintenance of an airline, even if it has only one plane in its fleet, is a top level economic decision calling for all the skills required by entrepreneurs wishing to

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succeed in the business.

Anyone who has opened his eyes, while at our nation’s airports, would readily observe the carcasses of planes once flown by hastily and ill-advised Nigerian entrepreneurs since the deregulation of the sector was undertaken by President Ibrahim Badamosi Babangida, IBB, in the 1980s.

Among the first airlines to be air-borne by those with any memory was OKADA Airlines.

Today, the existence of that carrier is a distant memory even to its owner. Since, then the aviation landscape in Nigeria had been strewed with the corpses of what were once promising carriers.

There is no need to list them seriatim; but the demise of Air Nigeria can serve as a metaphor for our increasingly failing attempt to join the Age of Aviation. One could easily have picked Belleview, ADC or Sosoliso. But, few people would remember those corporate corpses. For some, one crash was all it took to send them packing; for ADC it took two. Some did not even need a plane to crash before they closed the booking offices. Air Nigeria was one of them; and that was what makes its exit, among others so remarkable.

No regular watcher of CNN News could have missed the Air Nigeria advertisements. It made me proud that a Nigerian airline could afford to pay the steep price of advertising on CNN alongside the Qartar Airways and South Africa’s main carrier. But, just as we were getting ready to start taking the Air Nigeria serious, it was grounded for reasons still very obscure. That by itself explains why we are still largely fringe players in the

Since, then the aviation landscape in Nigeria had been strewed with the corpses of what were once promising carriers. There is no need to list them seriatim; but the demise of Air Nigeria can serve as a metaphor for our increasingly failing attempt to join the Age of Aviation.

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sector which is almost 120 years old. Airlines in Nigeria are run like a secret society; few people actually know what is going on in the companies; their financial statements are not published and few people know those in charge. The other side of that coin is that few people trust the airlines. As a result there is very little brand loyalty; no widespread support and when troubles come they go down, sometimes literally, without anybody missing them because the owners have operated the airlines to please themselves and nobody else. That is the fundamental flaw; for Nigerian airlines customer satisfaction is a theoretical idea not central to the business.

A comparative illustration will help to demonstrate what is at stake here. Most air travelers globally, including Nigeria, seek to save time and to avoid the discomfort associated with road travel – given the atrocious condition of our roads. For those

reasons they first of all travel long distances; endure traffic hold-ups and end at airports at least one hour before departure time. Invariably, in Nigeria, all that sacrifice is in vain. The flights never take off on time; delays and cancellations remain the rule; even for those who booked in advance. And when, the flight finally takes off, hours behind schedule, not every pilot, or Captain as they call themselves, has the good manners to apologise to the “captives” on board the aircraft.

Elsewhere in the world, in places where the countries have fully joined the Age of Aviation, a passenger starting from Eket, Akwa Ibom State; travelling first to Lagos and from there to Abuja; and finally wanting to catch a flight to London, can check his luggage through to London carrying only his carry-on luggage. Not in Nigeria; the luggage checked will never arrive in London.

More serious, the passenger who expects to catch connecting flights at Lagos and Abuja might discover that his flight to London had departed a long time ago – leaving him/her stranded in Lagos or Abuja. Obviously, all the advantages of air travel over any other means have been eroded by Nigerian airlines leaving only one – the lack of good alternative means of getting to our destinations.

THEIR OWN GRAVE DIGGERS nknown to the few Nigerian airlines still in operation today, they have become their own grave diggers. For instance airlines servicing Lagos-Benin; Lagos-Warri; Lagos-Ilorin

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continue to enjoy patronage only because two major roads have been allowed to become death traps. The two roads still saving them are the Lagos-Ibadan and the S h a g a m u - B e n i n Expressways. Once the Federal government of Nigeria becomes responsible and restores those two roads to their former status, nobody will again accept the insult of having to wake up in the morning; head for Ikeja airport only to wait until 3.00 pm before the Benin or Warri or Ilorin flight takes off. In fact, any customer, specifically, those residing at Victoria Island, Ikoyi, Lekki, Ajah, etc, will need to have his/her head examined for driving two hours to the airport; wait three or four hours for a flight to Benin when the journey would have been completed in three hours by road. When that time comes, as it inevitably must come, the only thing that will save the airlines from total extinction is good customer service – an idea which, at the moment is totally alien to them.

Let me provide an example from a recent personal experience with two Nigerian airlines – Arik and Aero Contractors. I was travelling to Uyo in the last week of November. To ensure a seat was available, the booking was made two days in advance on Arik. The flight was scheduled for 13.30 initially. Not wanting to take chances with traffic, I left home at 11.00 a.m. It was just as well. The hold-up from Maryland was terrible. Just as the taxi conveying me to the airport was descending the fly-over near the General Hospital, a text message came through informing me that that the flight had been shifted to 14.40. I had no choice but to proceed to the airport.

Business & Economy

BY PETER EGWUATU HE Nigerian Stock Exchange (NSE) has warned investors not to miscomprehend the Investors Protection Fund (IPF) for insurance scheme.

The warning is coming after the Federal Government granted forbearance package to the stockbrokers following the margin saga with banks.

The shareholders argued that the government, via Asset Management Corporation of Nigeria (AMCON) took over their investment without compensating them while stockbrokers were considered

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NSE warns investors not to misconstrue IPF for insurance scheme for debt forgiveness.

Some of the shareholders said, “ We equally lost our money through the shares we bought so government should consider us and instructing the NSE to compensate us through Investors Protection Fund.”

The Executive Director, Market Operation and Technology of the NSE, Mr. Adeolu Bajomo,said, “ IPF is not insurance policy where

investors can make claim for.

The IPF is meant for investors who genuinely made transaction with stockbrokers but such deal was not executed or was somehow defrauded by the stockbrokers.”

Bajomo, noted that margin transaction between stockbrokers and banks were genuine transactions but were not previously regulated.

According to him,

“Shareholders should note that whatever investment they made was risk taken by them.

Investment in the capital market is risk bearing and the shareholders are risk takers, but for depositors government needed to protect them because they are not risk takers and in any systemic failure they must be protected.”

He declared that the primary responsibility of the

NSE like other exchanges is to provide investors, issuers, and intermediaries with efficient, transparent, and well regulated market where capital is raised.

Continuing, Bajomo, informed that the NSE is overhauling its trade platform to make transaction on the stock market very transparent, with various market surveillance mechanism.

34 — Vanguard, MONDAY, DECEMBER 17, 2012

Appointments vicahiyoung@yahoo.com 08033348923

Promasidor names Onubogu Commercial Director

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ROMASIDOR Nigeria

Limited, makers of cowbell milk and other consumables, has named its Marketing Director, Mr. Onyekachi Onubogu, Commercial Director.

The appointment takes effect from January 1, 2013.

Prior to this elevation, he had been the Marketing Director since February 2012. Onubogu is an experienced marketing and business development manager with cross functional and multinational living and working experience across Africa. His career has spanned over 18years in the sales, marketing, finance Mr. Onyekachi Onubogu

and general management functions.

He joined Promasidor in September 2010 as General Manager Marketing. Before joining Promasidor, he was an associate director with Prosperity Capital Management, Nairobi in Kenya from September 2008 to September 2010 as well as marketing manager with Family Care, Kimberly Clark South Africa from January 2008 to August 2008.

The new Commercial Director, also worked with Guinness Nigeria Plc, as marketing manager for two years and with Procter & Gamble in Nigeria and South Africa for Ten years.

Onubogu is an Alumnus of the Wharton Business School, where he studied Advanced Management Programme in 2012.

UDC elects Ejukwas President U

GEP Development Council, UDC, has appointed Dr. Emmanuel Ejukwas, President.

Ugep is a community in Yakurr Local Government Area of Cross River State of Nigeria.

The Lagos wing of UDC, comprising four wards with 80 units, elected Ejukwas President,

Dr. Emmanuel Ejukwas

said he is an Obol title holder and an indigene of Ukpankom in Ijiman Ward, Ugep in Yakurr.

The new UDC President has a Certificate of Competency in Marine Engineering at MAN Oron, Postgraduate Diploma, PGD, in Transport Management Ladoke Akintola University of Technology, LAUTECH Ogbomosho, Master in Transport Management, MTM, LAUTECH and Master in Business Administration, MBA, Human Resource, LAUTECH. He also possess a PHD in Business Administration, USA, Diploma in Law, Criminal Justice and Administration, University of Lagos, UNILAG, UniLag Ikeja, Presently 300 level student in law, LLB in-view at the National Open University of NOUN, Lagos, he is also a fellow of over five chartered institutes, a former Chairman of Maritime Workers Union,

MWUN, Nigerian Ports Authority, NPA, branch and founder of the Emmaneh Ebri Ejukwas Educational Empowerment foundation.

Determined to ensure quality education among the Ugep people, Ejukwas said that a fund would be set aside to assist indigent Ugep youths in Lagos in their quest for educational advancement. “We have decided therefore to make a commitment for the sponsorship of eight WASC/GCE students, two youths from each ward within UDC Lagos. By February 2013, we would have paid up the total sponsorship package for eight SSS 3 Ugep youths within UDC Lagos,” he said.

The new President was elected along side, Ofem Nkanu, Vice President, Ikpi Ujong General Secretary, Kingsley Ubi, Assistant Financial Secretary and Iquo Oden, Treasurer.

Honeywell graduates bakers

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ONEYWELL Flourmills Plc, has graduated 14 fresh bakers from its training school.

The graduation marked the 20th certification ceremony of the school, which has so far trained over 270 master bakers in 20 Regular Courses and 1 Executive Course since it became fully operational in 2006. According to Honeywell’s Executive Vice Chairman, Mr. Folaranmi Babatunde Odunayo, the school was

established to produce well trained and professional bakers exposed to the latest baking techniques and committed to the highest quality.

They are also to increase brand loyalty by exposing bakers to Honeywell’s finest flour products. Represented by Marketing Director, Mr. Benson Evbuomwan, Odunayo, assured the graduands that the company had remained focused on achieving the objective of using the baking

school as a tool to empower bakers with basic and modern baking skills.

He noted that beyond the training, Honeywell’s foreigntrained bakers also regularly interacts with graduands and provide them with tips and latest trends on how to improve their product offerings and bottom line. A graduand, Mr. Napoleon Ameh, said coming to the Baking School “is not a mistake we have been exposed to modern trend and modern baking technology.”

Badang, five other police officers get award

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EARGENT Sunday Badang, a late Police bomb disposal officer, has received post humour award alongside five other officers for outstanding gallantry.

The other five Felix Odogu; Joshua Yusuf; Ayuba Usman;Saliu Jibril and Paul Nukis.

They were honoured by Puzzles Group in appreciation of their dedication and commitment to duties.

Badang award was received by his widow Mrs Badang in Abuja.

Late Badang was killed while using a bomb scanner to ascertain an object suspected to be Improvised Explosive Device, IED, bomb allegedly planted by the Boko Haram sect near the Sultan Bello Mosque, Kaduna.

Chairman of the company, Mr Bayo Adeyemo in a briefing to mark the company’s 5th anniversary said Puzzles group had set the pace for other corporate organisations in the country to begin to encourage

and motivate the police rather than castigate them.

He said, “We want to set to the pace for corporate orgnisation to motivate and support the Nigerian police, it will be a very good yardstick for others to emulate”.

For Felix Odogu (F/No. 477657), the Puzzles Group chairman said the Constable who serves with the Swift Operation Squad (SOS), exhibited an unparalleled act of gallantry on 23rd October 2012 during a police raid on a militant camp in Khana LGA of Riverrs State. Odogu was the first person to scale the wall into the militant’s stronghold where he came under a hail of bullets.

He was undaunted and defended himself even as other members of his team offered him cover and reinforcement.

The militants’ attack and resistance was eventually repelled.

After the gun battle, 14 of the militants were shot dead and 6 AK 47 rifles, 444 rounds of live ammunitions and magazines were recovered.

Pix l -r; Alex Otti Group Managing Director Diamond Bank Plc ,Dr Dora Akunyili former information Minister and Pince Nicholas Okoye President Founder Anabel Group at the day 2 annual Nigeria Leadership Summit organized by Anabel Group in lagos.

Photo;kehinde gbadamosi.

4,500 staff of Pfizer Nutrition join Nestlé Group

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OLLOWING the successful conclusion of the regulatory process in most m a r k e t s , Nestlé completed the acquisition of Pfizer Nutrition on 30 November 2012.

Consequently, the integration process of Pfizer Nutrition into Nestlé Nutrition, that will see 4,500 employees of Pfizer Nutrition join the Nestlé Group, is underway.

Pfizer Nutrition’s strong brands and product portfolio, together with its geographic presence, complements Nestlé’s Infant Nutrition business.

85% of its sales are in emerging markets, many of them with large, fast-growing

populations. Building on our growth-focused strategy, global presence and pioneering research and development, the newly enlarged business will enhance our ability to become parents’ trusted partner, offering them a wider choice of nutritious food to ensure their children make a healthy start to a healthy life.

In Australia, Nestlé’s remedy commitments, which are not material in the overall context of the transaction, have satisfied the regulators. The regulatory approval process is still underway in Kenya, South Africa and five Latin American countries. We continue to review our strategic options in those countries.

Vanguard, MONDAY, DECEMBER 17, 2012 — 35

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36 — Vanguard, MONDAY, DECEMBER 17, 2012

Tax Matters

Imperatives of taxation on tourism development in Nigeria (1) T

he opportunity for a citizen to know his own environment, a deeper awareness of national identity and a sense of belonging to a culture are all major reasons for developing domestic and international tourism.

Taxation as a Catalyst to Tourism Development Taxation has been found to be a potent tool for speeding up the process of tourism development in Nigeria and by other nations all over the world. Aside from taxation serving as a source of revenue for executing development projects in the tourism industry by government, favourable tax incentives introduced by the government have proven to be a strong means of stimulating the activities of operators in the tourism industry.

The federal and state governments of Nigeria, in their effort to develop tourism, have created Tourism Development Authorities charged with the responsibility of planning and controlling the process of tourism development.

Examples of such projects are: Development of the coastline of Lagos Bar Beach, Badagry Beach and Lekki Beach by Lagos State Government; Development of the Osun shrine village and the hosting of the OsunOshogbo Festival by Osun State Government; Development of the Argungu Festival village and hosting of the Argungu Festival by Kebbi State Government; Development of the Obudu Cattle Ranch and the Tinapa Project by the Cross River State Government etc All these projects are being substantially funded with revenue from government revenue. The Nigerian government has also been supporting tourism development through tax incentives. Due to lack of awareness, full advantage is not being taken of the incentives. This is why effort has been made to bring them out in this paper.

Incentives existing in the tax laws (1) Creation of a Tourism Industry Development Fund to be listed in the 5 th

,

Calabar Festival

The federal and state governments of Nigeria, in their effort to develop tourism, have created Tourism Development Authorities charged with the responsibility of planning and controlling the process of tourism development

,

Schedule to the Companies Income Tax Act (CITA), Cap C 21, LFN 2004 as amended.

The statutory basis for the above lies under Section 25 of CITA 2004 as amended. (2) Investment Tax Credit: The applicable statute on this incentive is Section 26(3) of CITA 2004 as amended.

Section 26 (3): “Companies and other organisations engaged in research and development activities for commercialisation shall be

allowed 20% investment tax credit on their qualifying capital expenditure for that purpose.” A lot of companies in different sectors of the economy have been enjoying this benefit. The incentive is also available for tourism industry operators to enjoy.

(3) Deduction of reserve made out profit for research and development The statutory ground for this incentive lies under Section 26 of CITA 2004 as amended.

This is a good incentive for tourism industry operators to enjoy.

(4) Incentive for Reserve made out of profit for tourism development 25 % of incomes derived from tourists by hotels in convertible currencies are exempted from tax provided such income are put in a reserve fund to be utilised within five (5) years for expansion or construction of new hotels or facilities used for development of tourism.

(5) Low Tax Treaty Concession Rate of 7.5 percent for foreign investors from treaty Nations.

This incentive was introduced as part of the 1999 Fiscal Policy. It is applicable to investment income such as royalty, interest, rent and dividend earned by Nonresidents who are citizens of treaty nations (i.e. countries having Double Taxation Agreements with Nigeria) which are to liable to

withholding tax deduction at 7.5 (%) percent. A rate of 10 (%) percent is applicable to non-residents who are citizens of Non-Treaty nations.

Foreign investors in the tourism industry from treaty nations can enjoy this.

(6) Accelerated Capital Allowance Scheme Schedule 2 to the CITA gives the details on this. Tourism companies which incur qualifying capital expenditure in doing their business are entitled to enjoy capital allowances. Unrelieved capital allowances are allowed to be carried forward indefinitely. This is available to be enjoyed by both foreign and local investors in the Tourism industry.

(7) Loss Relief : The applicable statute on this is Section 31 (2) of CITA 2004.

The loss relief is subject to four (4) year carry forward limit.

This is also available for all local and foreign Tourism industry operators to enjoy.

(8) Repatriation of Net Earnings Outside Nigeria by Foreign Investors Section 101 Subsection 5 of CITA is the relevant provision on this. There is opportunity for foreign investors in the Tourism industry and other industries to repatriate their net earnings outside Nigeria immediately the tax obligation on the income has been fulfilled. This is part of what the International Tax Units of the Large Taxpayers Offices of

Federal Inland Revenue Service handle. Foreign investors in the Tourism industry are free to take advantage of this.

(9) National Tax Policy and Tourism Industry It is pertinent to mention that with the approved National Tax Policy, it is considered imperative to address the issue of multiple taxation and introduce more sector focused but time bound incentives to support the tourism industry and other industries in Nigeria.

Government will be motivated to give more incentives if the operators in the Tourism industry are prepared to be tax compliant by filing their tax returns and paying their taxes as and when due.

Conclusion It is obvious from the foregoing that taxation is an essential catalyst to the development of tourism in Nigeria. The relationship between the two should be a mutual one. If government supports tourism development with favourable tax regime which will lead to greater output and income, the tourism industry will in turn support government with more revenue through payment of more income tax, personal income tax, value added tax etc. This type of symbiotic relationship where one reinforces the other is good for the nation.

Vanguard, MONDAY, DECEMBER 17, 2012 — 37

Aviation

Unsafe Airspace: NAMA debunks claim by Air Traffic Controllers Stories by LAWANI MIKAIRU & DANIEL ETEGHE

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anaging Director of the Nigerian Airspace Management Agency (NAMA), Engineer Mazi Nnamdi Udoh, has debunked the claim by Air Traffic Controllers that the Nigeria Airspace is unsafe for pilots flying within the country.

Speaking at the agency headquarters in Lagos, Engineer Udoh reassured Nigerians, all the airspace users, pilots and other stakeholders that the Nigeria airspace is safe for flight operations. He said “for record purposes, NAMA wants to use this opportunity and this platform to reassure Nigerians and all our airspace users, pilots and other stakeholders that the airspace is safe and will always be safe” Earlier, there was a media report,not Vanguard, that the Nigerian airspace is gradually becoming a

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...says Nigeria airspace is safe for flight operations nightmare for pilots flying within the country as indications shows that the radio communications on some routes may have collapsed.

Engineer Udoh further said that if the claim that the country’s airspace was unsafe was from any of the Air Traffic Controllers, then it means that such Air Traffic Controller had not been working in the last three months, stressing

that he wonders how aeroplanes could have been flying in the last three months yet they say, the airspace was unsafe.

“If they are quoting Air Traffic Controller, it means that, the Air Traffic Controllers has done no work in the last three months and he is not supposed to be paid and how do aeroplanes fly in the last three months” he asked.

Engineer Udoh however pointed out that the only challenge that was confronting the agency at the moment was its long range frequency of communication that it has just introduced affirming that there was no control tower that has a single challenge in the country at the moment.

“Now the simple explanation is this, you will not say that you have total

DHF today, what were you doing before, we talk to Lagos, we talk to Benin, we talk to Asaba, we talk to PortHarcourt or Enugu .We called it point to point communication now in Lagos with one frequency you can communicate until you are transferred to Port-Harcourt that is just the meaning of that but because of congestion you have to separate East and West of that sector.

FAAN appeals to passengers against rush at festive season I

n a bid to ease the normal passengers’ rush experience every Christmas and New year seasons at the various airports across the country, the Federal Airport Authority of Nigeria ,FAAN, has appealed to Nigerian passengers to make adequate preparation for the season.

General Manager

Corporate Communications of FAAN, Mr. Yakubu Dati who made the appeal said that air travellers should make early preparations for their travel to avoid the rush that usually take place during these periods.

Mr. Dati further noted that during the festive seasons airports across the country

usually witness a huge volume of passenger traffic due to the increase in local movements of passengers travelling for the holidays as well as those returning from different countries overseas for the same purpose.

He said “passengers should leave home early during these

festive periods in order to confirm their tickets and complete other pre-boarding formalities in good time because of the heavy vehicular movements on access roads close to the terminals that may cause some passengers to miss their flights”

38 — Vanguard, MONDAY, DECEMBER 17, 2012

ICT BRIEFS FirstBank partners Bestman games in Lagos city Monopoly

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irst Bank of Nigeria, FBN is making massive investment in inculcating financial literacy in youths through the sponsorship of Lagos city Monopoly game with Bestman games.

The games according to the partners will give the youths a head start in the quest for a fulfilled future and facilitate the emergence of astute managers of Nigeria’s economy in future.

Speaking at the City of Lagos Edition of the Monopoly Board Game, Mrs. Head, Marketing and Corporate Communications, First Bank of Nigeria Limited, Folake AniMumuney, said that the Bank believed in the project as a vital platform for instilling financial literacy and personal finance discipline in youths.

For her, “FirstBank supports the Lagos Monopoly project which Lagos State Government has adopted as a tool to teach financial literacy to students in all public secondary schools.

We believe that it presents a huge platform for exposing our youths to the rudiments of financial education thereby laying a sound foundation for economic prosperity in Nigeria,”.

She said the Bank was happy to work with Bestman Games on the initiative that also promises to be a powerful tool for promoting family values and enhancing the nation’s cultural heritage as youths can relate to the familiar streets, neighbourhoods and leading brands captured on the board game.

Blame game: N20 billion interconnect debt pitches telcos against each other

A

Nigerian Communications Commission, NCC, organised regulatory forum on high incidence of Interconnection debts in the telecom sector, at the weekend, stirred the hornets nest in the perceived N20 billion debt, with operators trading blames on why the debt rose so high.

There were also strong arguments over how much, the operators owe each other, as well as means of settling the debts since many operators in the Code Division Multiple Access (CDMA) segment who are heavily indebted to their Global System for Mobile communication (GSM) counterparts are almost already extinguished.

The debts which are already affecting the growth of the telecom industry have been subject of discussion at different levels of engagements between the operators and government but the regulator had decided to make it a public discussion with the forum. Vanguard leant that major disagreements at some of those meetings have been allegations of falsification of bills and imbalance in the interconnection ratio between the CDMA operators and their GSM counterparts.

This has most times resulted in arbitrary disconnections which worsen the ailing service quality of telecom offerings in the country.

However, one of resolutions at the forum by both Industry analysts and legal experts that mediation and arbitration should be explored before a network is disconnected.

It was also suggested that migration of traffic and debt

L-R: Chief Risk Officer FirstBank - Mrs. Remi Odunlami; Former Minister of Foreign Affairs and Chairman of Bestman Games - Mr. Odein Ajumogobia, Honorable Minister of Foreign Affairs - Gbenga Ashiru, CEO of Bestman Games - Mrs. Nimi Akinkugbe, His Excellency, Governor of Lagos State - Babatunde Fashola and his wife at the Official launch of the City of Lagos Edition of Monopoly at the City Hall, Lagos recently.

Blame game: N20 billion interconnect debt pitches telcos against each other Stories by PRINCE OSUAGWU settlement through an interconnect clearing exchange, was very necessary.

Speaking on the solution to the problem in paper titled “What is the solution to interconnection indebtedness in Nigeria”, Partner, Banwo and Ighodalo, Mrs Abimbola Akeredolu said that interconnect indebtedness in the Nigeria’s telecoms sector is currently put at about N20 billion. However, she also admitted that approximately

60 percent of these debts are disputed as many operators alleged that the figures were inflated by competitors’ faulty billing systems. Akeredolu said the large volume of the debts was often linked to sharp difference in revenue sharing ratios between mobile operators and fixed wireless operators.

According to her, “the feeling in the industry is that if the situation persists whereby GSM firms are better favoured than the fixed and wireless operators, such a situation will continue to lead to interconnectivity debt, or breakage. “In practice, the

NigComSat kicks off e-voting campaign with NSE elections A Nigerian Communications Commission, NCC, organised regulatory forum on high incidence of Interconnection debts in the telecom sector, at the weekend, stirred the hornets nest in the perceived N20 billion debt, with operators trading blames on why the debt rose so high.

There were also strong arguments over how much, the operators owe each other, as well as means of settling the debts since many operators in the Code Division Multiple Access (CDMA) segment who are heavily indebted to their Global System for Mobile communication (GSM)

counterparts are almost already extinguished.

The debts which are already affecting the growth of the telecom industry have been subject of discussion at different levels of engagements between the operators and government but the regulator had decided to make it a public discussion with the forum. Vanguard leant that major disagreements at some of those meetings have been allegations of falsification of bills and imbalance in the interconnection ratio between the CDMA operators and their GSM counterparts.

This has most times resulted in arbitrary disconnections

which worsen the ailing service quality of telecom offerings in the country.

However, one of resolutions at the forum by both Industry analysts and legal experts that mediation and arbitration should be explored before a network is disconnected.

It was also suggested that migration of traffic and debt settlement through an interconnect clearing exchange, was very necessary.

Speaking on the solution to the problem in paper titled “What is the solution to interconnection indebtedness in Nigeria”, Partner, Banwo and Ighodalo, Mrs Abimbola Akeredolu said that interconnect indebtedness in

the Nigeria’s telecoms sector is currently put at about N20 billion. However, she also admitted that approximately 60 percent of these debts are disputed as many operators alleged that the figures were inflated by competitors’ faulty billing systems. Akeredolu said the large volume of the debts was often linked to sharp difference in revenue sharing ratios between mobile operators and fixed wireless operators.

According to her, “the feeling in the industry is that if the situation persists whereby GSM firms are better favoured than the fixed and wireless operators, such a

revenue sharing ratio between mobile and fixed network is 14/6 and 12/8 depending on which network is termination or originating the call. Fixed and landline operators are asking that parity be introduced with growing argument that all network face equal challenges ”, she stated.

Meanwhile, Globacom’s Regulatory Affairs Manager, Tunde Aremu admitted that a N20 billion interconnect debt was possible, urging the NCC to give urgent intervention to the issue of interconnection debt. Also, senior manager, regulatory affairs, MTN, Oyeronke Oyetunde, corroborated the claim, adding that huge interconnect debts running into billions of Naira was currently plaguing the sector. She also urged the regulator to intervene before the issue gets out of hand. Other telecoms analysts and legal luminaries, who spoke at the forum, agreed that mediation and arbitration should be explored before a network is disconnected as well as migration of traffic and debt settlement through an Interconnect clearing exchange. They agreed that Nigerian Communications Commission (NCC) has a major role to play in ensuring the stability of the industry.

Executive Vice Chairman, NCC, Eugene Juwah, had earlier admitted that the issue of interconnection indebtedness has emerged as a major source of conflict and challenge, which has the potential of destabilizing the successes recorded in the industry.

Vanguard, MONDAY, DECEMBER 17, 2012 — 39

Advertising, Media & Marketing BRIEFS

STORIES BY PRINCEWILL EKWUJURU

DIGITAL BROADCASTING:

iven the significance of the fundamental human rights of Nigerians, the over 44 million Television viewers and partly Pay TV subscribers are by now supposed to be fully aware of the global reality that in the next 2 years their current analogue Pay TV decoder and television sets would no longer be relevant unless they have undergone transition to the digital platform.

But all that will be a ruse, because experts have said it will not happen to decoders and television sets as insinuated in some quarters, but that analogue decoders may not be able to catch certain station on the digital platform.

Before now, Nigeria had set 2012 for its digital terrestrial TV, DDT switch over, but this was not realised as a result of the country ’s shoddy preparation, thus the country is looking up to 2015.

Ahead of the date, however, and switch over, Digital Terrestrial Technology (DTT) service provider in Africa, StarTimes/NTA launched the DVB-T2 technology, the latest modern Pay TV decoder in Nigeria.

The company at a press briefing unveiling the equipment before newsmen said the major advantages of the DVB-T2 is its ability to offer more educative, news and entertainment because it contains more channels as one frequency on DVB-T2 has the capacity for 25 channels and can be expanded further, with

StarTimes deploys DVB- T2 technology

Jonnie Walker sponsors Mode Award to raise equity

*To replace existing decoders

onnie Walker, an alcoholic beverage from the stable of Guinness Nigeria Plc said it laid its weight behind 5th edition of Mode Men Award to keep the award going and to increase the brand’s equity in the market.

Speaking at the event, Mr. Seni Adetu, Managing Director and Chief Executive, Guinness Nigeria Plc said that Johnnie Walker and Mode Men have a lot in common.

“Johnnie Walker identifies with Mode Men magazine’s Men of the Year Awards because of shared values they both recognize and celebrate.

Here this evening, respect is being shown to men who are committed to a cause – the celebration of their achievements so far is something that is done to encourage them further in the continued journey of achievements.”

Clinching “The Striding Man” award, which is solely sponsored by Johnnie Walker, was Jason Njoku, the founder of iROKO TV. Njoku became The Striding Man of 2012 by virtue of his approach to life’s many challenges.

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lagos presently having three frequencies.

With this, Nigeria has therefore joined other countries like Kenya, Uganda, Mozambique, and Tanzania where the StarTimes introduced the technology.

Speaking,Mr. Bayo Adebayo, Senior Adviser to StarTimes, said StarTimes mission is to ensure that every home in Nigeria enjoys affordable digital

entertainment backed by its collaboration with NTA, a strategic partnership that will help Nigeria in actualising its 2015 digital transition deadline. “StarTimes will leverage on the existing platform on NTA to provide quality digital service to every home in Nigeria,” he said.

He said that having StarTimes DVB-T2 decoder with up to 75 channels of great sport, music, movies,

news and lots more is a vision coming to reality, as Nigerians can now confidently migrate into digital space with StarTimes as it provides them with the latest technology in DTT operation that can give up to 75 channels and quality digital entertainment.

For customers who have the old technology, Adebayo said customers who recharge for two months can have access to the new technology.

From Left: Ejike Izejiobi, TM, Product & Channels Mgt; Gbubemi Babanto, Team Lead, Product & Channels Mgt; the winner, Miss Moriola Olatunji in company of classmates; Mr Olatunji and Oluyemisi Vese, Retail Sales, Ikota Branch.

Children! Which bank takes care of your future? * As Access Bank target kid customers

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arlier days children

were taught the habit of saving by their parents. Gifts in form of money from uncles, brothers, during birthdays, family friends are usually dropped in piggy banks which are kept at home, with time all that vanished with the advent of contemporary banking system.

For this reason, Access Bank launched the ‘Back to School’ campaign to encourage and promote savings culture amongst its target audience by asking that a minimum balance of N50,000 is maintained on the Account during the duration of the campaign that ends on January 31, 2013. With this, account holders immediately qualify for ‘Dora branded Lunch Box’. This scheme is neither a raffle draw nor a promotion, but a reward for customer loyalty.

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Interest rate of Access Early Savers, product of Access bank has competitive interest rate. It offers exclusive monthly Dora the Explorer merchandise when the account is opened with a minimum of N5,000 and subsequently, minimum monthly deposits of N10,000, opportunity to attend exclusive Access Early Savers parties and exclusive membership of Access Early Savers Club.

The bank said the introduction of Access Bank Early Savers Account had significantly transformed children financial product offering in Nigeria with the inclusion of fun and excitement in the total offering for children.

The partnership with Nickelodeon, a global family entertainment brand, to drive its financial inclusion strategy for kids, parents and

educators has created impressive experience for Nigerian children through interactions with Dora, the Explorer and Boots, its friend at several parties facilitated by Access Bank and Nickelodeon.

On the initiative, the Divisional Director, Retail Banking Division, Access Bank, Mr. Obinna Nwosu, had said, “Account holders with a minimum balance of N50, 000 on their account for 30 days during the campaign automatically qualify to receive the co-branded gift items.”

“The campaign is part of Access Bank’s resolve to promote continued financial responsibility and independence amongst the younger generation and a tactic for ensuring that children, parents and guardians do not relent in their efforts towards achieving financial independence.”

A parent, Mrs. Josephine Nwanne, said, “It’s not just to open account for your kids but to do so with a bank that can offer you the best interest rate on your deposit.Apart from high interest rate, there is the need for you to explore other features or benefits that the banks offer before you can open account for your wards.”

Vanguard investigation shows that nine banks offer kids accounts products. Banks such as Union bank launched the Union Kiddies, GTB Smart Kids Save (SKS) is designed to create banking awareness in children and encourage a savings culture from an early age.

Diamond Kiddies Account from Diamond bank is another product which enables customer to start saving on behalf of their children aged under 18 years.

Skye Rainbow account is a children savings account product of Skye Bank.

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Don Jazzy now face of Loya milk

BY ADABA OLANIYI romasidor Nigeria, makers of Loya milk has chosen Michael Collins Ajereh (aka Don Jazzy) as the face of its Loya Milk brand, as it begins promo At the unveiling ceremony, the company also commenced an online based promo to give consumers an opportunity to feature in a Loya TV commercial with Don Jazzy.

The Commercial Director, Promasidor Nigeria, Mr. Kachi Onubogu while disclosing reasons for selecting Don Jazzy as brand ambassador for Loya Milk, said a brand ambassador will help the brand further reach its target audience.

“Our choice of Don Jazzy as brand ambassador is driven by the essence of the brand and its proposition to its target audience. Loya Premium Milk is a brand with class and taste; it is a brand with distinction and excellence, a brand that constantly rewards its loyal consumers. “

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40 — Vanguard, MONDAY, DECEMBER 17, 2012

Email:lesleba@lesleba.com, lesleba@gmail.com Blog page:www.lesleba.com/blog2 Website: www.lesleba.com

Tel:0817 002 3569

he other day, a friend narrated a story, which I found stranger than fiction; the story related to the travails of a family who lost a successful and illustrious breadwinner, who, incidentally, died without a Will. The family’s elders were consequently entrusted with the responsibility of efficiently managing the estate of the deceased.

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In spite of the huge credit balances, lucrative estates and other profitable income generating businesses, the Elders’ Council thought it wise to consolidate the incomes from these investments as savings for future generations!

Consequently, rather than spend from the robust income streams available, the Elders’ Council, in their wisdom, gleefully funded their expenditure by borrowing at over 15% interest rate from their bankers, while their savings earned paltry yields, often below 5%.

Predictably, the oppressive interest charges rapidly gulped up the erstwhile flourishing income streams until the mortgaged estates were systematically acquired by the banks as repayment for mounting debts. Within a few years, the once prosperous business became bankrupt and the family was reduced to penury.

I wondered aloud to my friend, whether this story related to a family made up of stark illiterates, but I was surprised when he confirmed that the Elders’ Council comprised a team of reputed professionals, who were educated in some of the best

A Fool and his Money… universities in the world!

When my friend took his leave, I quietly wondered if the story I had heard could ever be true; however, later that evening, it occurred to me that as outrageous as it may seem, in reality, the story of this tragic family appears congruent with the story of our country, Nigeria!

the same sources, which fund our government’s borrowings. Pray, why borrow back your own money at excruciating costs?

,

These banks, which currently post hundreds of

which are deliberately instigated by understating projected revenues annually. It is no wonder, therefore, that despite these increasing ‘surplus’ savings, there is deepening poverty and very little on the ground, nationwide, to show for our bourgeoning debt profile.

Meanwhile, the managers of our economy would grab every available opportunity to extol the wisdom of a fiscal strategy, which will take us nowhere!

Account or alternatively consolidated in a savings account designated as a Sovereign Wealth Fund; the yield from either account is probably below 3%.

Incidentally, the constitution does not recognise either of these accounts, which are definitely discordant in a truly federal constitution.

Instructively, the funds consolidated in both accounts may ultimately become inadequate for the liquidation of the rising debts, which were unnecessary in the first place, as we generated adequate income to have forestalled these humongous

Nevertheless fortunately, all is not lost, as the National Assembly constitutes a superior authority over the powers of the economic team. Indeed, in May 2008, in an article titled “National Assembly Fiddles as Debt Burden Cripples”, this writer warned the National Assembly to arrest the rapidly increasing debt accumulation by the Debt Management Office and the Central Bank; regrettably, the National Assembly remained reticent.

Predictably, the oppressive interest charges rapidly gulped up the erstwhile flourishing income streams until the mortgaged estates were systematically acquired by the banks as repayment for mounting debts

Nigeria is, undoubtedly, abundantly blessed with resources; for example, crude oil revenue alone often exceeds projected annual spending.

Curiously, managers of our economy annually deliberately understate projected revenue with very conservative benchmarks for crude oil price and output.

Government subsequently proceeds to finance the anticipated ghost deficits by borrowing at oppressive rates often above 15%, while simultaneously consolidating revenue ‘surpluses’ as savings deposits with yields well below 5%, particularly for dollar or euro denominated deposits!

billions of naira profits, are the same banks, who were also beneficiaries of over N5tn government funding in the last three years, according to recent reports from AMCON; meanwhile, revitalization of the real sector has remained just a promise!

It appears to be of no consequence that the same banks that receive our incomes and deposits for little or no yield are predominantly

Despite the huge borrowings to fund budget ghost deficits, the ‘surplus’ income is regularly hounded into a so-called Excess Crude

,

However, now that the cancerous impact of reckless debt accumulation has become very glaring, the current legislature would have failed our nation woefully if they do not immediately stop all government borrowings. It is necessary that we first determine the reason for accumulating an oppressive debt burden, which would be avoidable if current income streams are used to fund ghost deficits instigated by deliberate understatement of annual projected revenues.

government borrowings!

So, as it is with the misguided recklessness of the Elders’ Council in our earlier story, so it is with the management of the Nigerian economy. In spite of our fortuitous resource endowments generating more income than projected in our annual budgets, government remains committed to a strategy of borrowing at excruciating rates of interest to fund budget ghost deficits,

SAVE THE NAIRA, SAVE NIGERIANS!!

Business Economy

BY PRINCE OSUAGWU

Delta buys 49% stake in Virgin Atlantic

D

elta said it will buy almost half of Virgin Atlantic for $360 million as it seeks a bigger share of the lucrative New York-to-London travel market.

Delta plans to form a joint venture with Virgin Atlantic, where the two airlines would share money from the flights operated under the partnership. In order to coordinate the schedules of the two airlines, they’ll need antitrust approval from U.S. and European regulators.

Landing rights at London’s Heathrow Airport are limited.

So buying part of Virgin Atlantic is a way for Delta to get a bigger piece of the travel market between Heathrow and the U.S. Currently, Delta has fewer flights from the New York area to Heathrow than either American or United, its main U.S. competitors. If the plan is C M Y K

approved, Delta and Virgin Atlantic would continue to fly between the U.S. and the U.K., as they do now.

However, they would market the flights together and share the costs and profits.

Delta said it expects to have 31 round-trip flights between the U.K. and North America on the busiest days, including nine round-trips a day between Heathrow and John F. Kennedy International Airport in New York and Newark Liberty International Airport in New Jersey.

Heathrow is dominated by British Airways, which works closely with American Airlines. They have a total of 14 flights a day in each direction between JFK and Newark and Heathrow.

“Our new partnership with

Virgin Atlantic will strengthen both airlines and provide a more effective competitor between North America and the U.K., particularly on the New YorkLondon route, which is the largest airline route between the U.S. and Europe,” Delta CEO Richard Anderson said in a prepared statement.

Delta is aiming to have the joint operation running by the end of 2013.

Sir Richard Branson will still own more than half of Virgin Atlantic, which will continue to fly as a separate airline under its own name. In 2000, Branson sold a stake to Singapore Airlines for 600.3 million pounds, or about $960 million at the time.

That’s the share that Delta intends to buy.

Virgin

kind of tie-up with another airline. British media reports at that time said that Delta was interested. Shares of Atlanta-based Delta Air Lines Inc. rose 16 cents to $10.30 in premarket trading.

Atlantic has struggled with losses and said in 2010 that it might be interested in some

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