Financial Vanguard

NOVEMBER 25,

2013

From left: Hon. Justice Mitchel Chukwuma-Eneh, Justice of Supreme Court; Hon. Justice Mahmud Mohammed, Justice of Supreme Court; Mr . Segun Aina, President/Chairman of Council, CIBN and Hon. Justice Umaru Eri, Administrator, National Judicial Institue, NJI; Mr. Tunde Lemo, Deputy Governor, CBN, during the 13th National Seminar on Banking and Allied Matters organised by CIBN and NJI, recently.

subsidy which exerted considerable pressure on the top line throughout the year.” According to him, profitability however, increased with profit before tax growing by 78 per cent from N4.3 billion to N7.7 billion off the back of reduced raw material prices and manufacturing and supply chain efficiencies. “ In addition, net profit after tax and minority interests increased by 102 percent from N2.4 billion to N 4.9 billion. “Though the top line results are not in line with our projections, the choice of investing in volume growth and improving the cost structure during the year, gives us the confidence that this will put our company on the right footing for profitable growth in the future.

"Our focus during the year was to drive shareholder value through management of the cost base, and

Continues on page 18

Insecurity: Banks halt lending to fund business operations in Nor thern states

By FRANKLIN ALLI & NAOMI UZOR

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ANUFACTURERS in the country are licking their wounds over streams of loses as a result of built up finished inventories of goods in their warehouses they can not sell. This is as a result of the insecurity in the Northern part of the country that has taken away part of their market. Many company chief executives who spoke to Vanguard said the north is important to their business as the region accounts for more than 30 per cent of the Nigerian market.

Though the manufacturers see the market as huge, distribution of goods and services to this region is being C M Y K

—Sales dropped by 30% —Bank branches closed, working hour reduced —Firms scale up security budget

Plc Chairman, Professor Emmanuel Edozien, said its sales dropped by 1 per cent from N72.2 billion to N71.3 billion. In a review of the company’s performance for the financial year ended 2013, he attributed the drop in the company’s revenue to: “The social unrest in the Northern part of the country and the impact on the consumers’ spending power subsequent to the reduction of the fuel

2.05

2,665.00

+4.00

17.55

-0.09

108.16

-0.12

94.09 +0.33 CURRENCY

hampered by security challenges in the affected states.

This has led to significant reduction in turnover, reduction in sales force/ sales outlets; layoff of production staff by companies operating from other parts of the country due to high unsold inventory. From multinationals to small and medium size firms, the story is the same.

Speaking on the issue, PZ Cusssons

104.65

DOLLAR STERLING EURO FRANC YEN CFA WAUA RENMINBI RIYAL KRONA SDR

BUYING

SELLING

154.7 155.2 248.6803 249.484 208.0251 208.6974 168.4635 169.0079 1.5408 1.5458 0.2979 0.3079 235.4791 236.2402 25.3914 25.4739 41.2478 41.3811 27.8799 27.97 236.2424 237.0059

155.7 250.2878 209.3698 169.5524 1.5508 0.3179 237.0013 25.5564 41.5145 28.0601 237.7695

CBN Exchange rate as at 22/11/2013

18 — Vanguard, MONDAY, NOVEMBER 25, 2013

Cover Story

The Entrepreneurial Revolution: A New Order for Nigeria PT 1

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efore leaving office in 2007, former President Olusegun Obasanjo effected a notable policy decision. His government pushed through legislation that made Nigerian University students of all disciplines study entrepreneurship as a mandatory academic subject.

The move was part of an ambitious blueprint to take this resource-rich but paradoxically impoverished sub-Saharan nation with a litany of negative indices to the top twenty world economies by 2020. At its core was the idea of an entrepreneurial revolution that would drive this radical transformation. In earnest, the democratic government of Nigeria pushed through a series of progressive plans: From left Corp Marshal FRSC, Mr. Osita Chidoka; Keystone Bank Director, Mr. Charles Chidibe Umolu; Managing Director Keystone Bank, Mr. Philip Ikeazor, and Director of Keystone Bank, Brig General Maude Aminu-Kano during the official launch of the bank's health and eye screening initiative for commercials drivers in Nigeria held in Abuja, recently.

Insecurity: Banks halt lending to fund business operation in Nor ther Norther thern n states Continues from page 17

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driving economies of scale from our suppliers through our procurement division. We leveraged our investments in supply chain and manufacturing to improve margins while maintaining the quality of our products,” he said.

"The marketing of our products in the north is being hampered,” said Martin Woolnough, the immediate past Managing Director of Nestle Nigeria Plc. Describing the state of insecurity in some parts of northern Nigeria as “A stress on the economy", he said: ” We can’t get our sales team up there. That’s likely to impact the middle to long term brand equity in the future. Nestle Nigeria’s firstquarter net income fell by 3.4 per cent to N5.99 billion ($38 million) from a year earlier.

Revenue climbed 7 per cent to N30.7 billion.

Distribution, administration and other costs rose five percent from a year earlier to N17.5 billion because of an increase in marketing spend,” Woolnough said.

Woolnough, who noted that the company has about 140 sales staff in the country, said Nestle, the largest food company in Nigeria, temporarily withdrew about 10 of its sales staff from the three states for a week, the second time in four years it has evacuated employees since the insurgency began.

“People still need to eat food and cook their stews, so fortunately we are less

Now consumption is plummeting.

In 1st Quarter 2012, our milk sales volume declined by 14.3 per cent, powdered beverage sales by 3.7 per cent and tea by 9.1 per cent

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affected in the north than other products would be,” said Woolnough, referring partly to the company’s food seasoning Maggi, which he said was a “ very strong brand” in some areas affected by the fighting. Woonough retired recently after five years as head of the Nigerian unit of Vevey, Switzerlandbased Nestle SA (NESN).

He handed over to Dharnesh Gordhon, Nestle’s former sales director in southern Africa.

Nestle has invested 500 million Swiss francs ($524 million) over the past decade in Nigeria, building a second factory in Agbara, Ogun state which opened in 2011. The company also produces Milo chocolate malt and Golden

Morn cereal.

Commenting on the impact of the state of insecurity in the North on his company, Keith Richards, Managing Director of Promasidor Nigeria Limited, said: “You know with the borders closed, a lot of formal and informal exports are not happening. People are not coming from Chad, Niger, Cameroon and Mali. So you see a downturn in demand.

The North is important to us. A lot of our brands are doing very well here.

“Now consumption is plummeting. In 1st Quarter 2012, our milk sales volume declined by 14.3 per cent, powdered beverage sales by 3.7 per cent and tea by 9.1 per cent. But our seasoning products sales grew by 7.1 per cent. And I know all the businesses in the Fast Moving Consumer Goods, FMCG, are affected too, especially with products like beer, soft drinks and tobacco.”

Procter & Gamble Nigeria Limited (P&G) which has an expansive distribution network in the north is affected by the shutting down of stores, stemming from the crisis.

But Manoj Kumar, P&G chief for West Africa, says the company is up to the task. “We have been here for 20 years. All sorts of crisis have come and gone.

We are therefore not worried like other

Continues on page 19

*Abuja deregulated oil prices in 2007 and enforced the national Fiscal Responsibility bill and the Pubic Procurement bill. *A privatization programme was launched to disinvest in several large public sector enterprises in oil, communication and construction industries. *Reinvigoration programmes doubled growth of the traditionally neglected non-oil economy to 7 per cent in the five-year period ending 2005. *A bank consolidation programme was initiated in 2004 to fortify financial institutions and enhance credit access to the private sector. th Up until the last decade of the 20 century, the bulk of Nigerian businesses were necessity based and almost entirely related to trade rather than manufacturing. Extensive political and social turbulence in the 1980s caused rapid economic decline and a subsequent climate that was hostile to entrepreneurial activity of any kind. The second largest economy in the continent after South Africa and with the largest population of 148 million people, Nigeria’s economic situation drastically worsened.

A lot of water has flowed down the Niger since then! The nation currently ranks 41st in global GDP rankings, with its economy worth more than $165 billion – an effective fourfold increase over 10 year from just $36 billion in 1997. However, per capita GDP is just over $1,400 – below comparable data for economically worse-off African nations like Sudan, Congo and Swaziland – and more than half of the population lives on less than $1 per day. These figures are indicative of the large scale of socio-economic imbalance that has withstood recent outward growth.

A key factor in this is over-dependence on oil and gas production. Nigeria has the largest known gas reserves in Africa and is also the continent’s top crude oil producer at 2.17 million barrels per day, with proven reserves of more than 36 million barrels. It supplies 10 percent of US crude imports, most of the remainder going to Europe, Brazil and India. Yet, the sector that contributes 99 percent of export revenue has accounted for just 18 percent of GDP in recent years. This contradictory situation owes largely to infrastructural deficiencies and escalating militant activity in the Niger Delta region. An obvious snowball effect of these factors has resulted in a 60 percent fall in Nigeria stock markets over the last year, against an average of 40 percent for the rest of Africa.

On the brighter side, and for a country blessed with bountiful natural and human resources and a harvest-friendly tropical climate, 42 percent of Nigeria’s GDP currently comes from agriculture. This buoyancy has spilled over to other economic indicators as well. The inflation rate came down to 5.5 percent in 2007 from a debilitating 17.8 percent two years before (It went back up to over 11 perent in 2008 but largely as a result of the food crisis). International currency reserves have likewise seen healthy increase. Overall, the trends reflect an attitudinal change in Nigerian leadership that finally seems to have realised the importance of developing alternate, nonoil economic sectors; which have cumulatively grown by 7 percent since 2001.

All this has been despite a crippling set of problems that weighs Nigeria down. Top among them is prebendalism, a term coined specifically to denote Nigeria’s unique brand of corruption that is marked by large scale misappropriation of national assets by political and bureaucratic agents. Following a 2000 survey of 90 countries, Transparency International ranked Nigeria as the most corrupt in the world. Successive decades of massive embezzlement have wreaked acute social and economic deprivation on Nigerians, causing the country

Vanguard, MONDAY, NOVEMBER 25, 2013 — 19

agreement and hiked the bench mark to $79 per barrel.

Previous experience has shown that the perennial executive legislative feud over the benchmark price of crude oil produces no tangible results because the central challenge lies more in ensuring that projected barrel per day production of crude3 oil is realised. Moreover, the sums saved in the Excess Crude Account are available for use either during the year or at a later date.

The legal basis for this argument is “The Fiscal Responsibility Act” which was made as an Act to provide for the prudent management of the nation’s resources, ensure long-term macro-economic stability of the economy, secure greater accountability and transparency in fiscal operations within a medium term fiscal policy framework, and the establishment of the Fiscal Responsibility Commission to ensure the promotion and enforcement of the nation’s economic objectives and for related matters. The fiscal policy framework envisaged by the Act is the Medium Term Expenditure Framework (MTEF). The MTEF is to be prepared by the Minister of Finance and presented to the Executive Council of the Federation (EXCoF) for its consideration and endorsement after which it will be laid before the National Assembly (NASS) for approval by a resolution of each House of the National Assembly.

By the provision of this act, it will be wrong for the President to present the 2014 budget before the National Assembly if one arm of the National Assembly is not agreeable to the basis on which the budget is premised.

Instead of dissipating energies and wasting time, what will please Nigerians is not a fight over the budget bench mark but a clear fight over waste of resources and massive stealing of the nation’s financial resources. If these

Budget feud for the masses or self interest

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udgets all over the world are basic estimates that guide either the individual, corporate organisations or nations on their spending pattern. Budget projects the revenue that are being expected and the expenditure that will be following the projected stream of incomes that are likely to be realised from revenue sources. It is about the judicious allocation of scarce resources. A very good budget on paper can be frustrated by inadequate financing or lack of capacity to implement the policies that will ensure the full realization of the budget. To the average economist, this is the way to think.

At the October 2013 World Bank/IMF meetings of global financial leaders, one thing that came out clearly was the fact that the global environment is still quite uncertain, even though growth is recovering in the euro zone, there is still uncertainties. The growth projections have actually been revised down.

More importantly, countries such as Nigeria were advised to build buffer strongly which means that Nigeria should step up savings in the excess crude account because it is not yet clear what else is going to happen in the near future.

But every year in the federal government preparation and presentation of budget, the executive and the legislature engages in a feud that leads no where. At the moment the President and the House of Representatives are in disagreement over what should be the budget bench mark for crude oil in the 2014 budget. While the President had proposed that the Medium Term Expenditure Framework/Fiscal Strategy Paper MTEF/FSP, be based on $74 per barrel, the Senate and House joint Committee raised the bench mark to $76.5 per barrel. While the Senate kept to its own end of the agreement when it passed the MTEF/FSP two weeks ago, the House reneged on the

The House is well aware that budgets in Nigeria are a one way stream. Envelop budgeting system. It is a repetition of the same sub heads marked up each year. Provisions are made under several sub heads for the same item

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members were holding the President to the fact that oil theft is making the nation lose so much revenue, every Nigerian will sing the praises of the house members. Oil thieves are on rampage yet nothing is being done as government continues to plead helplessness. When the House uncovered the subsidy scam last year, every Nigerian supported them.

The House is well aware that budgets in Nigeria are a one way stream.

Envelop budgeting system. It is a repetition of the same sub heads marked up each year.

Provisions are made under several sub heads for the same item. It happens in all the ministries. The house members have not the mental agility/capacity to detect these anomalies in the annual budgeting of the federal government. They are passed so long as provisions have been made for these men in power.

The annual fight over the budget bench mark is all about how much is available to corner

into private pockets. It is worrisome that the recurrent budget is always 100+1 per cent implemented but the capital budget is never implemented above 40 per cent. What will have been new is if the House members are insisting that since capital budget provision has not always been fully implemented, the total budget should be scaled down to a level where it will be fully implemented.

If the House members were altruistic in their action they should have said that the amount provided for entertainment for members should be scrapped, they should have insisted that since civil servants are paid, there should be no provision for office entertainment. They also should have removed from the budget all the non essential provisions of the budget. This can only happen if they have the capacity and will power which they lack.

More troubling is the provision of N150 billion for

National Assembly. Since 2010, NASS has been allocating N150 billion to itself. This is now a matter of right which cannot be changed by macroeconomic fundamentals or the expressed wishes of Nigerians. At the moment both executive and the legislative arm of government lack the political will to lead by example by reducing their perks of office.

The Executive arm has a lot of padding up in the budget that should not escape the eagle eyes of experienced and capable legislators. What is the President doing with several aircrafts in the Presidential fleet? These aircrafts are maintained with public funds. What is a minister doing with fleets of cars in a convoy? Not to talk of bullet proofs cars. What should an aide to a minister, Governor or any public office holder be doing with fleets of cars maintained with tax payer ’s money?

Disaggregating capital expenditure between administrative and developmental capital, the picture that emerges over the years is that up to 30 per cent of capital expenditure has been dedicated to administrative capital such as cars, office buildings for MDAs, furniture and equipment.

This has narrowed the band of capital expenditure that directly impacts on the citizens. It is this abuse of office that Nigerians want stopped that the House should address.

Business & Economy Continues from page 18

Insecurity: Banks halt lending to fund business operation in Nor ther n states Norther thern

companies which have spent a few years operating in the country,” he said.

The Lagos Chamber of Commerce and Industry (LCCI) in its Business Environment Report, said that many firms in the country have lost 30 per cent of their sales because of insecurity in the north, which denied them access to the region. The report, which was prepared in the second quarter of the year, also said manufacturing firms sourcing raw materials from the North are now facing

serious challenges, while projects funded by banks in the affected states are at risk.

According to the report, the hospitality industry in the affected states have been paralysed just as many investors, especially small and medium enterprises are relocating to other states.

“Many bank branches have been closed, while the working hours for others have been drastically reduced.

Sales representatives of many companies have fled the affected states. Many projects

under construction in the north have been abandoned while security budgets have been scaled up by many firms,” said LCCI. The survey also disclosed that expectations from the North which represent 30 per cent of total Nigerian market have shrunk considerably due to goods produced by these manufacturers are no longer sold out to the supposed buyers because of the flinch market volume.

LCCI furthermore noted that the scope of coverage for

manufacturers in the northern part of the country is limited as investors could not set up factories in the north out of fear of being terrorised, bombed or shut down due to lack of low sales and that manufacturers who had their companies in the north and those who distributed to the north all had a loss of market share and revenue derivable from the region.

The survey also disclosed that marketing and distribution activities of many companies in the North have

been brought to a standstill especially in the manufacturing sector, adding that most investors and workers had to flee the state(s) to avoid being killed by terrorists.

On the effects of insecurity in the banking sector, the survey stated that increased lending to northern business was impossible as the possibility of paying back the loans were not visible .Consequently, banks saw it as a great risk to lend to an investor intending to invest in the north.

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20 — Vanguard, MONDAY, NOVEMBER 25, 2013

Business & Economy BRIEFS Yuletide: Customs increase Seme border surveillance

By GODWIN ORITSE

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he Nigeria Customs Service, Seme Area Command, has intensified its anti smuggling patrol to

further prevent acts of smuggling this yuletide period when import and transit activities within the land frontier are expected to be on the rise.

As a result Comptroller Othman Abdu Saleh, the Customs Area Controller (CAC) has directed the full deployment of patrol vehicles; logistics and personnel, while all staff leaves, passes and permits for absence to all personnel of the command are cancelled with a view to ensuring that all operatives are fully on ground during the yuletide.

He said the command cannot afford to disappoint the government of Nigeria and the Comptroller General, Dr Abdullahi Dikko Inde CFR who is committed to the realization of the full potentials of the service.

He also reiterated the Customs Service Management’s zero tolerance to smuggling while urging all officers and men of the command to strictly keep to the roster for rotational shift duties aimed at ensuring round the clock full presence of the command’s personnel.

Yobe state Gov to address investors at LSE

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s part of efforts to bring i n f r a s t r u c t u r e development to Yobe State, His Excellency Governor Ibrahim Gaidam would be addressing infrastructure investors at the UK Infrastructure Investors Summit, taking place at the London Stock exchange on the rd 3 of December.

The Governor will be presenting papers with the theme: “Yobe State re-opening for Business”. The presentation will highlight investments opportunities in Infrastructure, Renewable Energy, ICT, Solid Minerals and Agriculture in the state.

The UK Infrastructure Investors Summit is part of the UK Infrastructure Conference and Expo (UKICE) organised annually and is a private gathering of world leading infrastructure primary investors to discuss market transformation at the top end of the infrastructure investment sector as well as where to invest in the capital structure.

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From left: Minister of Trade and Development, Ireland, Joe Costello; Executive Director, Lagos Businesses Diamond Bank, Uzoma Dozie and Senior Vice President, CR2 Group of Ireland, Juan Cejudo at the partnership meeting between Diamond Bank and CR2 Group in Lagos recently.

BoI approves third party guarantees for credit facility Stories By FRANKLIN ALLI

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he Bank of Industry, BoI, says collateral is no longer an issue for accessing its credit facility as it has designed credit schemes and products that allow reputable persons third party guarantees on loan applications.

BoI Managing Director, Evelyn Oputu, disclosed this while addressing Nigerian and Danish business community in Lagos. According to her, the issue of collateral requirement to access funding was neither here nor there because the bank has already identified that some serious businesses do not have collaterals.

“BoI has designed some credit schemes and products that have gone ahead to address people without collateral through cooperative lending and our bottom of the pyramid programme where we normally channel funds to microfinance banks for onward lending.

“BoI also accepts peer group and reputable persons’ third party guarantees to give grants to applicants, and also accepts lien on the equipment to be acquired

with the given funds.

“So collateral is no longer an issue. What is important is the track record, attitude to debt servicing because credit has to do with integrity, if you have integrity issues definitely you cannot access the bank’s fund,” she said.

Represented by BoI’s Regional Head, South, Balarabe Hassan, she noted that there are several reforms and fiscal measures currently being implemented by government to bring about improvement in the nation’s investment climate, protect local companies and mobilise

local and foreign direct investments into the manufacturing sector.

Oputu, said that the bank is not static as it has been designing solutions to challenges militating against specific sectors of the economy.

“BoI is always futuristic not having to wait but envisaging what will be beneficial to the economy and with proactive initiatives we make efforts to bring about economic development,” she said.

She explained that reforms take time to mature and that within the manufacturing

sector the bank is trying as much as possible to see that all problems militating against the sector were addressed squarely. Fielding questions on the volume of trade between the two countries, the president of the Nigerian-Danish chamber of commerce and industr y, mines and agriculture, Ben Koya Adako, said, “The volume of trade now, considering the size of Nigeria, I will not say it is too encouraging but as at the last report we had about 1.35 billion Euros.”

N’ Assembly tasked on passage of National Tobacco Contr ol Bill Control no better time than now for he National Assembly Nigeria (ERA/FoEN), said, effective legislation to Thas been called upon to “WHO has estimated that regulate the manufacture, ensure speedy passage of the judging by current trends, by National Tobacco Control Bill (NTCB) into law in order to avert eight million Nigerians from dying yearly from tobacco related diseases before the year 2020.

The Public Hearing on the NTCB started more than four years ago, specifically since 2009. Briefing the press in Lagos, Akinbode Oluwafemi, Director of Corporate Accountability Campaigns, the Environmental Rights Action/Friends of the Earth,

the year 2020, tobacco will kill more than 8 million people every year, with four or five of these deaths occurring in low and middle-income countries like Nigeria.

“We cannot but agree with the WHO that tobacco use is the single most preventable cause of death globally.

Tobacco is responsible for the deaths of close to six million deaths every year. With this gloomy picture of the future as painted by WHO, there is

distribution and marketing of tobacco products in Nigeria,” he said.

He noted that Nigeria will not be the first country to ban tobacco and corporate social responsibility activities by tobacco industry. “Ukraine recently passed one of the strongest tobacco advertising bans in Europe, including all forms of sponsorships and socalled “CSR”, which the WHO recognizes as thinly veiled marketing.

Vanguard, MONDAY, NOVEMBER 25, 2013 — 21

Business & Economy

Investment in agriculture necessary to conquer hunger by 2050

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early 240 million Africans are malnourished and although only one-third of those who face hunger are in Africa, the percentage of people who suffer from hunger here is higher than in any other regions of the world, stated Mr. Charles Abugre Akelyira, Africa Regional Director of the UN Millennium campaign, based in Nairobi.

“We must invest in agriculture not just to feed the current generation but to prepare for the two billion more mouths we will need to feed by 2050. In particular, we have to invest in small-scale agriculture, as part of our mixed strategy. Two-thirds of our farm outputs come from small farmers,” he said.

Mr. Akelyira was the keynote speaker at the recent two-day convention entitled: ‘A Decade of CAADP: Reflections on Key Outcomes of Agricultural Policy Reforms in Africa.’ The convention, held at the Laico Regency Hotel in Nairobi, Kenya was sponsored by TrustAfrica, in partnership with the Bill and Melinda Gates Foundation.

Its purpose was to raise awareness about the role of agriculture in development and to give voice to those most affected by agricultural development policies, particularly smallholder farmers.

Participants from Ghana, Malawi, Kenya, Tanzania, Uganda and Nigeria, came together to reflect on the work they have done under TrustAfrica’s Agricultural Reform project. The advocacy project, begun in 2010, seeks to raise awareness among smallholder farmers about the promises made under the Maputo Declaration Target, which, in part, states that African governments will dedicate 10 percent of their budgets to pro-poor agricultural policies. The aim is to have farmers hold their governments accountable for the budgets they have been promised. So far TrustAfrica has assisted 21 organizations over the 3 years the program has been in operation. It has donated approximately $955,629 in grants on behalf of the Gates Foundation.

During the conference, panelists reflected on the performance of the Comprehensive Africa Agriculture Development Program, CAADP since its inception 10 years ago. There was an agreement that more education needs to be done to create greater awareness around the issues facing smallholder farmers on the part of CAADP. “ We have their blessing, but not their drive,” a participant noted.

“There should be sectorwide reviews involving all C M Y

stakeholders,” stated another.

“This has been an important opportunity for stakeholders working with the smallholder farming sector to gather together their impressions, lessons learned and ideas around the issues related to the CADDP and improving the lives of smallholder farmers,” said TrustAfrica Acting Programme Director, Dr.

Tendai Murisa.

“However, when it comes to the issues that concern these stakeholders, there is still work to be done. We are excited about the fact that the AU has decided to declare 2014 the year of Agriculture and Food Security. However, we are concerned that African governments have not increased their allocations to

agriculture. There is an urgent need to realign the policies and resources of governments so that they better reflect the already existing consensus that in Africa, agriculture has the potential to be the engine that can drive inclusive growth and development,” he added.

From Left:Mrs.Modupeola Babalola,Marketing Manager,Golden Noodles Nigeria Ltd;Mr.Chris Orewa,Site Manager;Mr.Yiannis Katchristis,GM/Director,Marketing Manager,Golden Noodles Nigeria Ltd,and Oluremi Ayeni,Deputy Director,Trade Development,SON,at the Presentation of NIS ISO 9001:2008 Certificate by Standards Organisation of Nigeria to Golden Noodles Nigeria Ltd,held recently in Lagos.

CPC clamps down on Aer act or Aeroo Contr Contract actor orss over passenger s’ rights passengers’

By FAVOUR NNABUGWU

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onsumer Protection Council, CPC, has invited passengers on Aero Contractors Flight AJ 132 who passed the night at the airport for no fault of theirs only to be flown the following day for a chat with the intention of sanctioning the airline.

CPC Director-General, Mrs. Dupe Atoki in Abuja weekend, said the agency will hence forth hasten up investigations and prosecution of consumer rights violators in the country.

Piqued by the distasteful experience of the 50 passengers booked on the flight of the airline, CPC invited the passengers to come forward with evidences of maltreatment and relay their loss and experiences to the agency.

About 50 passengers who were scheduled on the flight

were unable to proceed on their journey and had to spend the night at the Airport terminal building until the following morning, Saturday 9th November 2013 when the flight was eventually operated” The intervention of the CPC in the airline’s operation, she stated, is to protect the interest of the passengers as regard their rights.

“CPC intervention in the matter is to ensure that consumers are protected, treated fairly and when violations occur, appropriate redress and remedies are provided in accordance with Nigerian Civil Aviation Authority, NCAA’s Passengers’ Bill of Rights, Atoki said” She posited that it is a common practice in this civilized age for nations like Nigeria to make laws that are designed to protect the interest of its citizenry in the

course of buying and using goods or services which is why the CPC is there to protect consumer against exploitation, risk of exposure to harm as well as providing platform for consumers to seek redress” Atoki said the council which has been granted an in-house prosecutor status can now call to order the most influential organisation that violates consumers’ right as they are bound by the laws of this country.

“CPC has prosecution powers and has secured the Attorney general of the Federation’s approval for an in-house prosecutor who can speedily institute actions against any person or company that contravenes the provisions of CPC Act or violates the order of the council,”she stated.

BRIEFS Yellen clears Senate hurdle to become next US Central Bank Governor

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S Senate Banking Committee has approved Janet Yellen’s nomination to become the first woman to lead the Federal Reserve, sending it to the full Senate for a final vote. If she is confirmed, as is widely expected, the current No. 2 at the central bank will replace its chairman, Ben Bernanke, when his term expires on January 31, making her the most powerful woman in world finance.

The vote was 14 in favor and 8 against. Three Republicans voted in favor of her nomination and one Democrat voted against. Nominated by President Barack Obama, Yellen is viewed as a monetary policy dove who puts more weight on driving down high unemployment than on the risk this will ignite future inflation. She will preside over a central bank that has taken dramatic and unconventional steps to spur U.S. growth and hiring, measures that have stirred fierce complaints among critics fearful of future inflation and the potential for asset price bubbles.

Bisquit deepens presence in Nigeria

By WILLIAM JIMOH

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he House of Bisquit, makers of Bisquit Cognac, in partnership with Celebrity Master Chef, Mr. Pete Goffe-Wood of South Africa, is tapping into the booming global trend of “pop-up restaurants” to create a one-of-kind fine dining event in Nigeria.

Since its launch in the country in 2012, House of Bisquit seeks to increase its presence in the country so as to avail connoisseurs of their favourite cognac through various events and partnerships.

And as a kick off to this increased focus on Nigeria, ‘L’art de vivre’ (the Art of Living) event at the Le Griffon pop-up restaurant in Muri Okunola Park, Victoria Island was hosted recently to connect with its Nigerian cognac connoisseurs.

According to Mr. Stanislas Ronteix, Global Marketing Director, Bisquit Cognac, the focus of the event is on delivering a fine dining experience to connoisseurs presence in Nigeria

22 — Vanguard, MONDAY, NOVEMBER 25, 2013

Banking & Finance BRIEF Customs to issue PAAR 6 hrs after processing documents

BY GODFREY BIVBERE

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Volume and Value of PoS Transaction Jan-Oct 2013 Stories by BABAJIDE KOMOLAFE

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he cashless policy started in Lagos January 2012, but it is yet a policy in most major public institutions.

A good example is the Lagos state hospitals. A visit to any of these general hospitals will reveal little or no attempt on the part of the management to promote electronic payment.

It is not that they don’t have the Point of Sale Terminals; they do, but they hide them. In most of the general hospitals, you hardly see any compelling poster or publicity to encourage people to pay with card, and neither is it offered as an alternative. This was experienced firsthand at the Gbagada Annex of the Lagos State University Teaching Hospital. The cashier at the fee paying pharmacy store had a PoS terminal but hid it in the drawer. No sign, no poster that you can pay with card. But the reason is not far-fetched. When you pay with cash, you may forgo your balance, especially if you are in haste. The cashier announces before collecting money, “No Change”. So you decide whether to forgo the balance or come back for it, if you have to be served.

Observing this scenario, a customer complained, “Why can’t you get PoS so that people can pay with card?

The cashier responded, “We have it”, and he brought the terminal out of the drawer.

The customer requested to pay with card, and to his delight the PoS worked, he did not have to forgo his balance.

The implementation of the cashless policy was hinged on rapid deployment and adoption

Cashless Policy: Antagonists of the PoS revolution

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igeria Customs Service, NCS has said that it will issue its soon to be introduced PreArrival Assessment Report, PAAR, six hour after peocessing documents submitted by importers and their agents.

Making this known in Lagos at its sensitisation seminar for stakeholders, Deputy Comptroller in charge of Information, Communication and Technology, ICT, Yusuf Bashar, said that the Service has concluded plans to make the programme a success.

Bashar said that from the submission of documents to the issuance of PAAR will take less than two days and the a consignee is free then to go make payment even before the goods arrive the country.

He explained that this will only be possible if an importer makes correct declaration of what is being shipped into the country when he logs into its trade portal. The Customs Chief pointed out that that it is unlike the present system where there is confusion between the Service Providers and importers as regards issuance of RAR. He noted that there were instances in the past when a RAR is issued by a Service Provider in one port, only for the consignment to be shipped to another one.

Bashar noted that the importer had to apply to have the RAR change to the Service Provider at the port where the consignment is sent to.

The old risk assessment regime takes between five and six days for the report to be issue. The new system which is expected to commence next month will greatly reduce the time. He explained that after the importer makes his declaration online, Customs examines them for correctness before sending them to the banks which then under take their own check and send same back to the Customs for issuance of PAAR.

What makes it difficult for the Lagos State government to introduce a policy of electronic payment in all its institutions like the general hospitals? If it can introduce electronic payment on its BRT buses, as it recently did, what stops it from introducing and promoting same in all its institutions?

,

of PoS terminals across the country. The strategy was that with PoS available nationwide for payment of goods and services, there would be little need for people to carry cash.

Till date 158,000 PoS terminals have been registered and statistics indicate increasing acceptance of this channel for payment. Data from the Nigeria Interbank Settlement System (NIBSS) show that transactions through PoS rose to one million per day in October from about 400,000 per day in January. Similarly, the value of transactions had risen to N18 billion per day from a N8 billion per day in January.

This increase could have been higher if public institutions in Lagos, especially the general hospitals have aggressively embraced and promoted cashless transactions.

But the public institutions in Lagos are not the only ones. A lot of merchants or companies in Lagos have

PoS. Some do not even display it for customers to see, while some just discourage people from using it. There is a certain company that sells frozen food items (fish, chicken, turkey etc.) located on Akowonjo road in Lagos. It is a big company, and it serve as the main supplier of protein for most people living in that axis of Alimosho local government.

The company has two PoS terminals, but its cashiers rarely display them. And if you request to pay with card, they insist you pay N200 fee ! This is to defray the percentage charged them by banks per transaction. That is the attitude of a lot of merchants. And that is why the PoS revolution is moving below potential.

Data from NIBSS show that out of the 158,000 registered terminals, 88,678 or 58 per cent are located in Lagos. Also the state accounts for 72 per cent of the one million volumes of PoS transactions per day. With just 31,000

terminals active nationwide, the implication is that most of the inactive terminals are in Lagos.

This is aptly reflected in the sectoral analysis of PoS transactions. Fast food and restaurants accounts for seven per cent, hotels accounts for three per cent, fuel stations-three per cent, drugs and pharmacy-two per cent, educational-two per cent, travel and logistics-one per cent, airlines – zero per cent!

Most of these services and sectors are based in Lagos and are patronized by people who have payment cards. You would expect them to lead the PoS transaction chart. Their poor performance is the product of an unwritten decision by the owners of these businesses to antagonize the cashless policy. For business owners, this might be understandable.

But what of government institutions like the general hospitals? What makes it difficult for the Lagos State government to introduce a policy of electronic payment in all its institutions like the general hospitals? If it can introduce electronic payment on its BRT buses, as it recently did, what stops it from introducing and promoting same in all its institutions?

And this should be the area of focus for the Central Bank of Nigeria (CBN) and the banks in their quest to achieve the cashless policy objectives.

The aggressiveness with which PoS terminals were deployed should be employed in engaging state governments, airlines, hotels eateries etc, to stop this indirect antagonism of the PoS revolution.

Vanguard, MONDAY, NOVEMBER 25, 2013 — 23

Corporate Finance BRIEFS NSE woos Asian investors

I

n line with the Nigerian bourse’s objective of attracting international investors, the Nigerian Stock Exchange (NSE) cond sponsored the 2 Annual Africa Investment Summit held in Hong Kong in mid November. The annual conference was hosted by FinanceAsia, one of Asia’s leading publishers of financial news and insight, and AsianInvestor, Asia’s premier source for news and information about the investment management industry.

Speaking on the panel, “How Investible are Africa’s Capital Markets” at the summit, Mrs Taba Peterside, General Manager, Listings, Sales and Retention, established that the NSE had delivered an over 30 percent return in each of the last two years, much enhanced regulatory oversight and cutting edge technology to increasingly make the NSE a natural hub for investors looking at Africa.

The Africa Investment summit is the market leader event for facilitating Asian – African investment trends and flows. Turnout at the Summit was excellent with over 250 African and Asian corporates, institutional investors, regional and global asset managers, as well as dealmakers gathering on 13th November at the Conrad Hotel in Hong Kong.

Investors wary of stock surge, even as money piles in

M

any prominent managers at the Reuters 2014 Investment Outlook Summit believe the record-setting run in U.S. stocks is due for a reckoning, but acknowledge that ample liquidity could push equities higher regardless of fears.

The S&P 500 has jumped around 25 percent this year, with major indexes notching record high after record high.

Investors pointed to potential drags on the market next year, be it a pullback in stimulus by the Federal Reserve to weak earnings that have made this market look expensive from a valuation basis.

“I’m very cautious on equities today,” said billionaire Carl Icahn, among the world’s most influential investors.

“This market could easily have a big drop,” he added.

The advance of 2013 will be hard to duplicate next year, particularly with the expectation that the Fed is going to slow its $85 billion bond buying program, which has pumped cash into global markets.

L-R Ozemoya Okordion, Senior Representative, Public Affairs, Mobil Producing Nigeria(MPN); Folashade Amole of Safety, Health and Environment dept., MPN; Elizabeth Essien, Manager, Nigeria Projects Organisation, MPN; Dr. Annette Akinsefe, National Director/CEO, Sickle Cell Foundation of Nigeria and Ebenezer Adeleye, Programme Co-ordinator, during the donation of Two Million Naira Cheque to the Foundation by Mobil Producing Nigeria

WAIFEM seeks reduction in domestic borrowing … Calls for institutional framework to track fund utilisation

By NKIRUKA NNOROM The West African Institute for Financial and Economic Management, WAIFEM, has called on the Federal Government to reduce the level of its exposure to domestic debt, saying that it costs the country much to service such debt.

The institute also called for institutional arrangement that will track the utilisation of money borrowed by the Federal Government to ensure proper management.

Speaking at a 2-day workshop organised by the Capital Market Correspondents Association of Nigeria, CAMCAN, Baba Musa, Director, Debt Management Department, WAIFEM, said that reducing domestic borrowing was necessary due to high interest rate paid on them because they do not have long redemption plan like external debt.

He noted that there is good tracking system in the states level, saying that the same system needs to be replicated in the federal level.

Speaking on a paper titled ‘Understanding Public Sector Debt,’ he said, “The quantum should not be our concern; our economy is growing, so we don’t expect the volume of our debt to remain the same. The concern should be using the fund for infrastructural development.”

“The rate of debt accumulation should not increase significantly. Beside that I think what is also important is utilising the money for what it is meant for because in an ideal situation, the money should be used only for infrastructure development and if the money is used for that, we should be able to pay back in the long run.

“There is no nation on earth that does not borrow, including America, Japan

among others, but the important thing is utilizing the money for the purpose it was borrowed for. You don’t borrow to consume; that is what is bad, but you can borrow to invest. And if you invest it properly, at the end, you will get high return which will benefit the economy,” Musa added.

He further stated that the problem Nigeria has had in area of debt management is more of coordination rather than for lack of skill to

manage the debt.

“First of all, the central bank was managing part of it; the Ministry of Finance has about three departments that were managing the debt prior to replication of the debt management office. And I think that even the Accountant General of the Federation used to have some portion that they manage. But there was no proper coordination among the agencies that are involved in debt management.”

NSE reaffirms commitment to improve market performance

By WILLIAM JIMOH

T

he Chief Executive Officer of the Nigerian Stock Exchange, NSE, Mr. Oscar Onyema, has reiterated the exchange’s commitment to improve performance of the market by conducting its activities in a socially responsible manner while delivering real value to stakeholders as well as provide supportive work environment for employees.

Mr. Onyema stated this at the NSE Essay Competition Awards 2013 held in Lagos, with the theme, ‘Building a Financially Savvy Generation’ where he stressed that the exchange is committed to delivering a sustainable organisation through

responsible financial and investment services, sustainable business practices, community contribution and environmental stewardship.

According to him, “ As a responsible business, we seek opportunities to create innovative and proactive solutions to societal and environmental challenges, as well as collaborate with both internal and external stakeholders to improve our performance and deliver real benefits in our operating environment.”

“Leveraging our expertise and partnerships, we are taking the lead in championing the integration of financial literacy in Nigeria. Through 200 free capacities building workshops aimed to enhance investor understanding of the basics of

investing around portfolio construction and risk diversification; approximately 16,000 retail investors from the grassroots can now make better investment decisions.

“Recently at the World Federation of Exchange’s general assembly that held in Mexico last month, the NSE signed on to the Sustainable Stock Exchanges {SSE} Initiative, which is a global forum for sharing best practices on sustainability and capital markets. The Exchange is honored to collaborate with the SSE Initiative. This is in line with our commitment to create sustainable value for our stakeholders and we are confident that this partnership will be pivotal to our goal towards entrenching sustainable business practices.

24 — Vanguard, MONDAY, NOVEMBER 25, 2013

Corporate Finance

Banks can't fund N464 trn infrastructures – BGL Director Stories by PETER EGWUATU

T

he N464 trillion needed for infrastructures over the the next five years in the country can't be provided by banks alone, said Chibundu Edozie, Group Deputy Managing Director, BGL Plc. He said that the Nigerian banks don’t have the capacity to fund the infrastructure needed for Nigeria as government requires a mix financing options to meet the infrastructural gap.

Speaking at the Chartered Institute of Stockbrokers (CIS) 17TH Annual Conference , he stated “N15 trillion deposits is in the banks and about N3.7 trillion in pension fund, but all these amount is not sufficient to provide the needed fund for infrastructure.” He harps on the low level of saving in the country, saying “Savings are very low in Nigeria. We don’t have reasonable saving culture; so the alternative is to seek capital market for additional funding."

Mr. Tola Mobolurin, Chairman, Capital Bancorp Plc in his own remark said “We need private sector involvement in sectoral reforms in order to have overall effect on the entire

economy. There should be holistic regulatory requirements if Nigeria must be among top economies.”

He further warned that the people should not be stampeded into Pubic Private Partnership (PPP) especially in some infrastructural projects, adding “The build and transfer system of the PPP has not benefitted the operators and should be carefully reviewed.”

Mobolurin, advised that the government to bring down the

cost of public expenditure, saying, “We need to bring down the cost of public expenditure. Government cannot fund all the projects with budgetary allocation. So the Nigerian capital market instrument should be used to fund some of the needed infrastructure in the country.”

Meanwhile, the CIS President, Alhaji Olushekun Ariyo also urged the Federal Government to make use of the Nigerian capital market to fund the infrastructure

requirement of the country.

Ariyo, who gave the advice, during the 17th Stockbrokers Annual Conference, said the allocation from national budget is no longer enough to provide the needed infrastructure that would boost productivity and general welfare of the people.

From left" Chairman, Institute of Chartered Accountant of Nigeria (ICAN), Lagos Mainland and District Society, Mr. Yaya B. Omini presenting a gift to the Chief Executive Officer, NSE, Mr. Oscar Onyema during the courtesy visit of the institute to the Exchange recently in Lagos.

FBN Capital seeks conducive environment for policy makers

F

C M Y K

BN Capital has called for a conducive environment for policy makers to make rules across the various sectors that will in turn accelerate economic growth and development of the economy.

Mr. Kayode Akinkugbe, Managing Director, FBN Capital has said “There is a need to create a conducive environment for key policy makers, foreign and local investors as well as the government, to interact and draw out plans on how we can develop and help create sustainable growth for the Nigerian economy. ” He further stated that the convention of strategic investor conferences would accelerate ongoing efforts geared towards enhancing national economic growth and development.

Speaking while welcoming participants to the company’s 3rd Annual Investor

Conference themed: ‘Tomorrow’s Nigeria through Economic Empowerment’, Akinkugbe said “FBN Capital had over the last three years sustained the conversation on how Nigeria can attain its quest to emerge as one of the world’s leading economies through its investor conference initiative. “Last year, the theme of our conference was Catalysts for Growth: A pragmatic Approach. The objective was to identify the enabling factors and specific practical actionable initiatives that are necessary in order to boost Nigeria’s growth. It is encouraging to see the signs of progress with some of the initiatives to reforms sectors considered to be key enablers, such as the power sector,” he added.

Noting that Nigeria was increasingly becoming a much more attractive destination for local and

foreign investors, Akinkugbe said there was still need for discussions around what it would take to move the nation from a frontier to a growth market. “It is heartening to see the development in the power sector, because the power sector is the key enabler of the economy,” he said.

Addressing the conference via a pre-recorded video presentation, Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi OkonjoIweala, commended FBN Capital for providing the investor forum adding that the government’s objective was to ensure Nigeria’s growth is sustainable, with the capacity to create jobs.

According to her, the rebasing of the nation’s GDP and fast growth are two factors needed for Nigeria to be the largest growing economy in Africa. “Nigeria is already seen as a hub. Our banks are

present in almost all West African countries.

We must strengthen sectorial development, but at the end, we don’t just need growth for growth sake, but we need growth to deliver,” she said.

Also speaking at the conference, Olusegun Aganga, Minister of Trade and Investment said the government had started an extensive reform oriented transformation process which cuts across the agricultural, power, fiscal, industrial banking, oil and gas sectors, among others.

“We need to focus on areas where we need to be competitive to attract the venture capital private sector players to acquire affordable finance for the economy to grow,” he said.

BRIEF Tiger Brands misses profit estimates amid weak spending

T

iger Brands Ltd. (TBS), South Africa’s largest food and household goods company, missed full-year profit estimates as weak consumer confidence in its domestic market and an acquisition in Nigeria weighed on earnings.

Net income fell 5.5 percent to 2.6 billion rand ($255 million) in the 12 months through September, the Johannesburg-based maker of Albany bread and Doom insect repellent said last week in a statement.

Earnings per share excluding one-time items decreased by 3.8 percent to 16.24 rand, lower than the 17.16 rand median estimate of eight analysts surveyed

by Bloomberg. Revenue advanced 19 percent to 27 billion rand.

“The difficulties facing the group have been driven largely by the trade-off between the group’s ability to recover cost increases through appropriate pricing and the pressure on consumers to purchase at acceptable price points,” Tiger Brands said.

South African consumers are under pressure amid unemployment of 25 percent and economic growth that will probably slow to 2.1 percent this year, the lowest since the 2009 recession, according to government estimates.

Consumer confidence in Africa’s largest economy dropped to a 10-year low in the third quarter as inflationary pressures curbed spending.

Dangote Flour Mills Pl of Nigeria, which Tiger Brands bought last year as part of a plan to expand outside South Africa, posted an operating loss of 389 million rand, according to the statement. “As with other acquisitions made on the continent, we expect that it will take two to three years to fully align the operations to Tiger Brands standards and for the business to deliver acceptable returns,” the company said.

Shareholders raise surveillance concerns at AT&T, Verizon

Vanguard, MONDAY, NOVEMBER 25, 2013 — 25

Banking & Finance

Sanusi bracing for shocks to Nigeria’s fiscal spending “We are bracing ourselves for the possibility of shocks from the fiscal side, and we will have to respond on monetary side,” Sanusi said in the interview, which was conducted in Abuja.

“We have always made it very clear that if we have to tighten then we will tighten.”

Jonathan, 56, who sought medical attention during a trip to London, postponed his 2014 budget speech twice this month, delaying it on Nov. 19 after lawmakers failed to agree on the benchmark oil price in the spending plan. Oil accounts for about 80 percent of government revenue in Nigeria,

C

entral bank G o v e r n o r Lamido Sanusi said he is bracing for public spending “shocks” as Nigeria prepares to vote in 2015, reducing the chance of lower interest rates.

“Toward the elections there will be a supplementary budget,” Sanusi said in an interview on Bloomberg TV’s African Business Weekly program. “I don’t think I have seen an election cycle in any country in which the government has not spent money.”

Sanusi held the bank’s key interest rate at a record high of 12 per cent on November 19 and said policy makers may raise borrowing costs if government spending surges in a pre-election year. While President Goodluck Jonathan has pledged to

•Lamido Sanusi keep the budget deficit under control, oil revenue has slumped this year and lawmakers

are pushing to boost expenditure, adding to put pressure on inflation.

Africa’s biggest crude producer.

Sanusi, who is due to leave his position when his term ends in June, raised concerns about high recurrent spending in the budget, such as salaries.

“There’s a lot of money in there that’s recurrent expenditure and overheads, and when you go down and start looking at the fine lines and the numbers, they ’re quite frightening,” Sanusi said. “And there’s a significant reduction in capital spending, which is a problem.”

The Central Bank of Nigeria has kept its benchmark rate unchanged since October 2011 to help

stabiliSe the naira and keep inflation under control.

Consumer prices rose at the slowest pace in more than five years in October, gaining 7.8 percent from a year ago, while the naira has gained 1.1 percent against the dollar since the beginning of September to trade at 158.65 as of 2:08 p.m. in Lagos, the commercial capital.

The 2015 election will be the stiffest test yet for Jonathan’s ruling People’s Democratic Party, which has been in power since military rule ended in Nigeria in 1999.

Four main opposition parties joined forces this year to fight Jonathan, who has not yet said whether he will stand for re-election

Euro zone mulls cheap loans as incentive for economic reforms – document

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uro zone governments are considering cheap loans to governments as an incentive to undertake structural reforms which pay off only in the medium-term, an EU document showed on Friday, introducing for the first time a discussion on fiscal transfers.

According to Reuters The document will form the basis of discussions of senior euro zone officials who will meet in Brussels on November 26 to prepare the next European Union summit on December 19-20.

The loans would be part of so-called contractual arrangements, which would be legally binding contracts with economic reform targets and macroeconomic milestones that trigger the payout of tranches of the agreed loan.

The loans would be attractive because they would carry an interest rate lower than the one a government could get on the market. In that respect, it would amount to a degree of subsidised lending, ultimately amounting to a mutualising of risk among involved member states and a degree of financial transfer - an idea that Germany has long resisted.

“Loans would imply only limited fiscal transfers across

countries,” said the 9page document, obtained by Reuters.

“Indeed, the transfer element would be limited to a lower interest rate than the market rate of most beneficiary member states, capturing the positive externality of the reforms for the EU as a whole,” it said.

To qualify, countries would have to draw up legally binding plans for reforms that would then be approved by other euro zone states. The conditionality would come on top of other macroeconomic programs such as the Stability and Growth Pact and the eurozone’s new budgetary oversight powers.

The size of the loan would not be linked to the cost of reform and would be meant as general support for the economy. It is not clear what time-frame the loans would be offered for, or what the limit on the size of any loan would be.

“The specific amount of financing would not be linked to the direct cost of reforms, which generally is difficult to measure,” the document said.

“Financial support should be conceived as an incentive or as general support to the overall economy rather than as a compensation for the specific cost of

reforms as such, as well as a broader signal of European support to the economic reform agenda of each member states,” the document said.

The loans would not be available to countries running e x c e s s i v e macroeconomic imbalances or currently under a bailout. However, an official briefed on the document said a country like Ireland, which is about to exit a program, could, for example, request a contract and if approved, benefit from the cheap loans.

The document did not specify how exactly the loans could be financed, mentioning only a European Commission idea from March that it could be either through direct contributions from governments or through designating a new revenue source.

One possibility, the official indicated, might be for the euro zone’s rescue fund, the European stability mechanism, to raise money on international markets and on-lend capital to a contracted member state, although the exact framework and process of the lending is yet to be finalised.

C M Y K

C M Y K Company Oil and Gas and Products Petroleum Prod ucts Capital Oil Plc 1st fTier Securities AGRICULTURE Crop Production FTN Cocoa Processors Plc Okomu Oil Palm Plc Presco Plc Livestock/Animal Specialities Livestock Feeds Plc CONGLOMERATES Diversified Industries A.G. Levents Nigeria Plc Chellarams Plc John Holt Plc SCOA Nigeria Plc Transnational Corporation UACN Plc CONSTRUCTION/REAL ESTATE Building Construction/Structure ARBICO Plc Constain (WA) Plc CONSTRUCTION/REAL ESTATE Non-Building/Heavy Construction Julius Berger Nig Plc Roads Nigeria Plc Real Estate Development UACN Property Development Real Estate Investment Trusts Skye Shelter Funds Union Homes Real Estate Investment CONSUMER GOODS Automobile/Auto Parts DN Tyres & Rubber Plc

Opening Price (N) 0.50

Daily Stock Market Report Closing Price (N) 0.50

Opening Price N

Quantity Traded 1,000

Year High 0.50

Year Low 0.50

E.P.S.

P.E. Ratio

0.50 43.39 35.00

108,460 523,199 115,742

0.50 24.58 8.30

0.50 14.53 6.40

0.10 7.33 2.75

50.00 2.77 4.37

4.68

4.15

1,927,483

0.66

0.48

0.11

15.00

1.55 4.15 1.29 5.32 5.35 67.00

1.55 4.15 1.29 5.32 5.87 67.00

197,747 100 6,066 33 324,217,696 242,920

2.54 7.60 8.82 8.28 1.82 42.50

1.45 6.43 5.89 5.52 0.50 28.70

0.16 0.31 0.00 0.35 0.24 6.89

5.18 20.74 0.00 15.77 3.64 4.14

70.01 8.46

5.05 0.66

20,000 1,684,760

4 2,720,390.38

70.01 8.46

24,302 400

62.26 8.28

32.96 3.01

4.11 4.73

10.11 2.26

18.00

18.00

231,142

20.15

11.59

1.69

7.33

100.00 50.00

100.00 50.00

1,000 -

100.00 -

97.00 -

11.75 -

8.51 -

0.50

E.P.S

P.E Ratio 9.71 18.03 6.71

2.01

46,875

10.54

9.52

0.00

0.00

0.50

6,100

0.50

0.50

0.00

3.91 3.22 2.10 63.65 1.99 1.00 7.36 1.85

4.32 3.22 2.15 64.00 2.08 1.04 7.36 1.85

286 22,529 2,773,742 306,716 269,100 605,089 100 20,000

5.31 1.45 3.20 23.11 5.61 1.96 12.91 200

5.31 0.70 0.83 2.58 3.61 0.95 0.95 4.28

ICT Computer Based Systems Courteville Investment Plc

0.66

0.66

530,100

0.52

0.50

0.10

10.00

Computers and Peripherals Omatek Ventures Plc

0.50

0.50

101,600

0.50

0.50

0.00

12.50

16.83 2.07

16.83 2.07

2,000 19,717

9.31 3.59

3.25 3.25

0.00 0.01

1.43 0.00

0.50

0.50

386,200

50,000

0.50

0.50

4,000

1.47

0.50

0.00

0.00

21.50 8.00 49.07 10.00 196.00 0.50 1.60 111.20 5.42 2.09 10.93

21.10 8.00 49.07 9.80 195.00 0.50 1.52 110.80 5.69 2.09 10.93

351,202 32,025 80,210 1,152,981 9,572,781 20,071 1,667,736 879,108 390,500 3,500 30

30.00 12.57 43.98 15.49 132.51 0.75 3.51 48.05 5.28 3.36 13.40

12.00 8.10 15.16 4.16 95.00 0.50 1.02 36.58 5.11 0.51 10.93

2.14 1.09 2.28 1.47 7.56 0.00 0.00 4.10 0.44 0.23 0.00

7.86 4.97 8.88 2.31 13.17 0.00 0.00 42.86 14.19 2.89 0.00

1.71 2.70

1,000 2,717,101

6.91 3.60

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

2.01

Year Low

452,402 15,444,945

ICT Telecommunications Starcomms Plc

103.50 19.70 1.44

Year High

10.56 0.87 0.21

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

103.50 19.51 1.40

Quantity Traded

103.50 10.64 0.03

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

20

Closing Price N

103.50 15.69 1.41

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

0.09

0.50 42.00 36.10

5.05 0.66

Sim Capital Alliance Plc Stanbic IBTC Bank Plc UBA Capital Plc

as at Friday, November 22 , 2013

0.19 0.44 2.62 0.20 0.09 0.00 0.00

0.00 88.50 0.00 3.07 9.05 14.13 0.00 0.00

0.50

0.50

70,000

0.50

0.50

0.00

0.00

16.99 250.00 22.01 169.00 0.74

15.55 259.99 22.20 170.35 0.77

50,000 280,215 396,550 823,266 3,000

4.63 255.00 7.10 100.00 1.01

2.23 186.00 5.23 72.50 0.93

0.00 9.95 0.41 5.08 0.00

0.00 19.98 16.29 22.22 0.00

Beverages-Non-Alcoholic 7-UP Bottling Company Plc

71.40

71.40

21,910

51.49

,39.00

2.69

13.92

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

Tools and Machinery Nigerian Ropes Plc

7.85

7.46

130,500

8.69

8.26

9.60 10.99 86.50 2.99 12.77 0.66

9.73 11.05 84.05 3.07 13.57 0.66

1,377,606 3,538,033 1,355,526 2,637,910 2,406,230 37,100

19.90 16.20 95.00 6.60 6.70 0.88

4.31 4.02 57.00 2.31 3.80 0.50

0.00 0.91 4.09 0.39 1.01 1.13

16.91 14.38 16.89 16.92 5.75 8.83

NATURAL RESOURCES Chemicals BOC Gases Plc

6.35

6.35

2,500

9.20

6.80

Metals Aluminium Extrusion Ind Plc

7.75

10.55

500

12.39

10.70

0.13

85.77

Food Products-- Diversified Cadbury Nigeria Plc Nestle Nigeria Plc

58.80 1,200.00

58.00 1,120.00

678,857 89,479

37.27 840.10

8.33 400.00

Non-Metalic Mineral Mining Multiverse Plc

0.50

0.50

170

0.50

0.50

0.01

0.00

Paper/Forest Products Thomas Wyatt Nig. Plc

0.87

0.87

43,412

1.38

1.38

0.00

0.00

Electronic and Electrical Products Cutix Plc Nigerian Wire & Cable Plc

1.89 0.50

1.89 0.50

96 1,996,401

2.50 2.58

1.62 2.58

0.11 0.00

13.15 0.00

1.44

1.44

2,000

1.51

1.33

0.03

28.80

3.98 13.75 12.68 4.30 1.05 2.92 0.63

3.98 13.75 12.68 4.30 1.05 2.78 0.66

6,888 916 150 29,198 200 84,311 2,749,340

3.98 15.58 15.03 4.30 1.86 2.92 0.63

3.98 12.71 13.97 3.60 1.05 2.92 0.63

0.00 3.90 0.90 1.22 0.30 0.07 0.00

0.00 3.26 0.00 3.52 6.18 41.71 0.00

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

0.50

0.50

4,173,250

0.97

0.87

0.19

6.06

Intergrated Oil and Gas Services Oando Plc

16.74

15.87

62,353,757

78.97

27.99

1.73

4.17

20.50 0.50 68.90 109.86 114.03 54.44 167.85

20.50 0.50 67.93 109.86 116.00 54.44 160.10

82,191 29,000 351,270 416,720 183,306 98,375 18,301

37.10 0.70 5.59

0.50 0.50 3.89

4.93 0.00 0.61

7.40 0.00 6.99

163.50 2,100 240.00

141.00 63.86 195.50

6.11 2.98 14.63

11.11 19.23 17.07

0.50

0.50

100

200

0.50

0.50

100

0.72

1.19

544,449

3.65

1.30

0.21

2.65 0.25

0.60 11.12

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

1.35 25.43

27.61 32.84

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

32.27 4.75 1.76

32.27 4.74 1.59

60 715,001 85,394

36.19 5.54 2.88

33.96 2.91 2.88

13.89 0.61 0.00

2.44 7.07 0.00

Personal/Household Products PZ Cussons Nigeria Plc Unilever Nigeria Plc

37.80 61.30

37.80 61.86

387,225 614,454

41.02 47.39

21.02 27.60

0.82 1.44

4.39 32.91

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

9.72 7.35 14.00 2.65 4.75 26.39 3.99 2.35 7.94 10.02 0.63 1.23 21.20

9.72 7.34 14.02 2.78 4.75 26.80 4.00 2.34 7.84 10.10 0.69 1.23 21.18

10,472,352 24,577,824 48,084,047 6,011,566 865,336 17,102,292 16,420,570 5,949,854 12,718,109 1,390,043 47,040,905 4,100,594 2,793,175

12.39 7.51 14.04 3.47 5.70 26.09 6.50 3.05 7.69 10.60 1.22 1.75 21.49

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

0.50 0.82 1.10 0.50 0.50 1.82 0.50 0.50 0.50 0.50 0.51 0.50 0.50 0.50 0.50 2.25 0.50 0.60 0.50 0.50 0.56 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.98

0.50 0.83 1.11 0.50 0.50 1.84 0.50 0.54 0.50 0.50 0.53 0.50 0.50 0.50 0.50 2.25 0.50 0.66 0.50 0.50 0.60 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.98

1,000 5,748,938 4,436,100 3,292,614 300,000 7,073,745 417,295,000 62,500 150 150 905,610 1,670,890 25,200 1,000 100,000 767,905 26,000 5,405,230 10,000 1,000 886,152 200 100,000 200 98,178 800 29,824 16,100 46,296,800

0.50 1.11 1.03 0.54 0.50 2.44 0.50 0.68 0.50 0.50 0.50 0.50 0.50 0.60 0.50 2.59 0.54 0.81 0.61 0.50 1.01 0.50 0.56 0.50 0.50 0.50 0.50 0.50 1.08

0.50 0.50 0.58 0.50 0.50 1.08 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 1.06 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50

6.60 0.78

6.60 0.81

4,100 1,057,351

6.00 1.18

0.00 0.92

0.04 0.92

150.00 10.56

1.49 0.50 0.50 0.50

1.49 0.50 0.50 0.50

345 6,300 500 100

1.57 0.50 0.50 0.50

1.37 0.50 0.50 0.50

0.19 0.02 0.00 0.00

47.6 7 25.00 0.00 0.00

2.00 0.50 1.21 16.54 552.20 0.54

1.99 0.50 1.09 16.64 552.20 0.54

174,052 22,000 140,000 5,215,963 464

0.75 0.50 2.02 20.00 100 0.78

0.00 0.50 2.02 8.57 552.20 0.50

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

0.19 0.00 0.00 2.03 12.68 0.13

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

9.16 0.00 0.00 9.85 43.55 6.00

Packaging/Containers Avon Crowncaps & Container Nigerian Bags Manufacturing Company

Mortgage Carriers, Brokers and Se Abbey Building Society Plc 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

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

1.71 2.74

1.23 4.30 0.50 4.55 0.71

4.20 1.20

620,515 1.31

3.67 105,520

0.50

1,580,395

1.64

4.55 0.71

1,000 38,527

400 2.07

Media/Entertainment Daar Communications Plc

0.50

0.50

77,500

0.50

Printing & Publishing.

Academy Press Plc Learn Africa Plc Studio Press Nig. Plc University Press

2.55 1.87 2.52 3.85

2.07 1.95 2.52 3.90

21,524 1,351,773 100 191,990

3.68

0.77

Road Transportation Associated Bus Company Plc

0.00 6.82

5.94 1.47

0.5 0.25 0.00

0.78

39.60 9.16 0.00

7.37

0.01 0.51

0.90 3.00 1.33

0.00

0.04

12.75 8.19 4.91 11.25

0.34 0.92

34.09 2.12

0.48

0.00

0.00

3.17 0.30 0.00 3.60

0.25

12.19

0.54

27.69

0.00

0.00

0.80

218,720

0.80

Speciality Interlinked Technologies Plc

4.90

4.90

5,530

5.15

4.90

0.50

0.00

0.00

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

3.31 6.00

3.47 6.15

255,760 567,439

2.78 11.75

1.57 6.50

0.60 12.53

4.22 8.75

26 —Vanguard, MONDAY, NOVEMBER 25, 2013

Capital Market

Vanguard, MONDAY, NOVEMBER 25, 2013 — 27

E-Commerce

Commodity Index Nov 15-Nov 21, 2013

Konga beats Jumia, Dealdey to win online retailer award N

igeria’s online r e t a i l e r Konga.com has emerged the winner for this year ’s online retailer of the year award, beating other e-commerce contenders like Dealdey,

Jumia and OLX. It also won the award for emerging brand of the year.

The event which took place in Lagos was organised by Marketing World Magazine and

From left, the Minister of Transport, Senator Idris Umar, and Engr. Adeseyi Sijuade at the commissioning of twenty pressurized oil tank wagons procured by the Corporation recently in Lagos.

had over 200 marketing communication executives and stakeholders in attendance.

According to the organiser, Konga.com has set the mark for online retailing excellence in Nigeria taking several big steps that have endeared the brand to Nigerians this past year.

Konga is the most visited e-commerce brand according to Alexa traffic rankings, and has the highest number of likes and followers on popular social media platforms, Facebook and Twitter.

Konga emerged the best emerging brand, beating brands like Techno and Gotv.

Vetting is against internet business model –NJOPKOU Stories by JONAH NWOKPOKU

T

he Chief Executive Officer of Karewa.com, an online classified company, Nino Njopkou has said that regulating online advertising through vetting is completely against internet business.

He disclosed this in an exclusive interview with Vanguard on internet advertising regulation and the role of the Advertising Practitioners Council of Nigeria, APCON on regulating advertising through the medium.

APCON’s Chairman, Lolu Akinwumi had recently said that the agency is set to tighten regulations on all online advertising in the country.

He had said that despite the challenges that regulating the medium poses, APCON would partner with Google and other online classified ad operators in the country to strengthen regulation and protect consumers.

According to him, “Regulating all advertising contents has always been and will continue to be APCON’s core duty. We have the Advertising Standard Panel, ASP, which under the law, has the power and the responsibility to vet all advertising materials in all media including the internet

for the Nigerian market.”

But Njopkou said that regulating advertising on the internet is very difficult because of the nature of the medium and that it would be best for individual operators to look for effective ways to regulate the content of classified ads and protect users.

According to him, “People might think that regulating online

advertising is like that of offline advertising. But, on the internet, things are fast, immediate.

Whatever mechanisms APCON put in place should not threaten the business, otherwise, it is acting against the business.

Clearly, vetting is against the Internet Business Model, because I don’t know of any country where online ads go through vetting mechanisms.”

IT startups decry high cost of VAS licence

S

t a r t u p Information a n d Technology, IT entrepreneurs in the country have decried the high cost of obtaining Value Added Service, VAS licence, saying it stifles growth and innovation in the sector.

Value Added Service charge is a fee mandated by law to be paid by IT entrepreneurs who wants to monetize any of their services through telecommunication companies operating in the country.

The Chief Executive Officer and Chief Financial Officer of Mobile Enterprise Ltd, a startup firm, Peter Akporume and Henry Afekuana who spoke to Vanguard on the challenges IT startups face, decried the numerous challenges

that startups have to contend with before finding their way into the IT business successfully.

“IT startups in Nigeria unlike many other IT compliant nations have lots of issues they have to contend with especially with the telecommunication companies. For instance an IT start up who wants to monetize his product must have to go through the telecommunication companies and that would require that you obtain a Value Added Service licence that presently costs N500, 000. And where would a startup that only has an idea get that kind of money,” Henry said.

“The greatest challenge is collecting payment for services rendered.

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28 — Vanguard, MONDAY, NOVEMBER 25, 2013

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Vanguard, MONDAY, NOVEMBER 25, 2013 — 29

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30 — Vanguard, MONDAY, NOVEMBER 25, 2013

Insurance BRIEF NAICOM to focus on microinsurance growth in 2014

T

he National i n s u r a n c e Commission, NAICOM, has said that it will focus on deepening insurance penetration through microinsurance and takaful insurance in 2004.

The Commission stated this at its microinsurance stakeholder’s engagement workshop in Lagos.

In an opening remark the Commissioner for Insurance Mr. Fola Daniel noted that the aim of the workshop was to have the views of all stakeholders as regards the microinsurance and takaful insurance before the commencement of the business.

The Commissioner who was represented by the Deputy Commissioner (Finance and Admin) Mr. George Onekhena said that the commission in 2014 be focusing on deepening insurance penetration through microinsurance and takaful insurance and for that reason will need the input of all stakeholders in preparing the guidelines.

Speaking further, Deputy Director Authorisation and Policy, Mr. Leo Akah while presenting his paper “An Overview of Micro Insurance Guidelines” said that microinsurance is not a conventional insurance that is expensive but affordable and to the reach of low income earners.

He noted that the industry had no choice than to embrace micro insurance in order to tackle low insurance penetration in the country.

He noted that the aim of the conference is to make sure that before the guidelines is released the stakeholders are knowledgeable about the concept, context and all that is required in the guidelines and if they have different view they can voice it out for the commission to look into.

He added that the commission wants the input of all stakeholders in the industry in order to ensure that the aim of the conference is achieved.

He however urged operators to take full opportunity of Nigeria population to harness microinsurance and takaful insurance, adding that micro insurance thrive in numbers.

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P

ension Fund Operators of Nigeria, PenOp, has said that many employers have refused to buy group life insurance policy for their employees as mandated by the Pension Reform Act, 2004.

According to PenOp, many families of employees who died in active service have become impoverished because their employers refuse to take up the group life insurance cover.

Chairman of PenOp, Mr. Musbahu Yola, who made this assertion in Lagos, said that insurance of employees is something employers need to take seriously.

Recall that the Pension Reform Act 2004 stipulates that employers must take up a life insurance policy for their employees of three times the annual emolument of the employee.

However, Yola said that a significant fault of many employers is that they have refused to take up this mandate for the welfare of their employees.

In a similar vain, PenOp has countered the popular notion making the rounds that the pension fund is idle, arguing that the fund from the Contributory Pension Scheme, CPS, is pensioners’ money and is very active.

Recall that the pension

From left, Head, Sponsorship and Events, First Bank Plc, Mrs. Bridget Oyefeso Odusanmi , Competition Secretary, Mr. Bayo Alli and European Professional Golf Association (PGA Golfer), Lee Corcoram at a Press Conference to herald First Bank Golf Championshipheld at Ikoyi Golf Club in Lagos.

Employers must prioritise staff insurance — PenOp Stories by ROSEMARY ONUOHA fund which currently stands at over N6 trillion has been generating a lot of controversy from various segment of the economy with even the Senate demanding that the fund be invested in infrastructure, claiming that it is idle and not well utilised.

Meanwhile, PenOp denied

the notion that it is idle; stressing that over 60 per cent of the fund is invested in Federal Government bonds.

According to PenOp, the government of the country should instead tell Nigerians how they have been utilising all the money they have been borrowing.

Meanwhile, Yola said that the new PenOp leadership will be focusing on having its own secretariat in the next few

Govt. should change CAMA laws that impede IFRS implementation – ICAN

D

eputy Registrar (Corporate Services) of the Institute of Chartered Accountants of Nigeria, ICAN, Mr. Olusoji Odukoya, has called on the federal government to change some provisions in the Companies and Allied Matters Act, CAMA, which could hamper the smooth implementation of the International Financial Reporting Standard, IFRS, in Nigeria. Odukoya made the call at an IFRS training session for journalists organised by Businessday Newspapers in Lagos recently.

According to Odukoya, such provisions in CAMA that will affect the easy implementation of IFRS in Nigeria must be changed.

He said “There are some provisions in CAMA that must be changed and the government should take steps to change such provisions that will impede the actualisation of IFRS.” Odukoya reiterated that there must be consistency in government policies otherwise the vision to achieve a smooth IFRS transition may not be realisable.

Meanwhile, Registrar/Chief Executive, ICAN, Mr. Rotimi Omotoso charged both quoted and unquoted companies to adopt the IFRS, in order to help the nation attract foreign direct investments.

Omotoso said the wholesale adoption of IFRS is both expedient and strategic to Nigeria’s quest for foreign direct investment and accelerated economic development process.

Omotoso said the propensity to attract foreign direct investments will increase with more reliable and credible financial statements as the nation’s risk profile would be known and predictable. “Investors are attracted to environments where the rewards are high relative to risks; availability of reliable information contributes to the lowering of the risk”, he said. On what the companies stand to gain from the exercise, Omotoso assured them that the adoption would push down their cost of raising funds, saying that the local stock exchange will become busier and more active as entities with IFRS-based financial reports continue to attract FDIs. His words: “The cost of raising funds depends significantly on the quality of information available to potential and existing investors, as well as the basis of accounting policies applied. Indeed, lack of knowledge of the basis of accounting implies higher risks and higher cost of raising funds.

months which would help coordinate its activities.

He said that his administration would place more emphasis on branding and communication, adding that the Association would engage and interact more with the public to ensure that proper knowledge about the industry’s operations is acquired.

He said he will work closely with the media to ensure proper dissemination of information about the sector, stressing that the essence of the media in education and enlightenment cannot be over emphasised.

The Chairman further said that his team would collaborate with PenCom in the quest to encourage savings culture among young people, and that the collaboration will also ensure that the transfer window initiative is achieved.

On the informal sector, the Chairman said that a framework has been designed by the regulator and in few months PenCom will roll out the guidelines that will enable them to empower the sector.

He further disclosed that the Pension Fund Administrators, PFAs have started engaging the informal sector and have started putting incentives that will attract the informal sector.

On transfer Window, the PenOp boss attributed the delay to lack of adequate equipment to handle the problem of identity, adding that the regulator is doing all it can to ensure that the problem is resolved by next year.

Vanguard, MONDAY, NOVEMBER 25, 2013 — 31

International Business

UBS targets wealthy Nigerians, others as Credit Suisse takes step back U

BS AG, the world’s biggest wealth manager, is targeting millionaire clients in oil-rich Nigeria and Angola as Swiss rival Credit Suisse Group AG (CSGN) withdraws from some African markets.

“The amount of people on the continent that fall within our wealth-management bracket is increasing every day,” Sean Bennett, the Johannesburg-based managing director of UBS in sub-Saharan Africa, said in a November 20 interview.

“There are still tons of opportunities still relatively untapped.” UBS is vying with Swiss banks from Julius Baer Group Ltd. to Pictet & Cie. for emerging market millionaires as a global crackdown on tax evasion forces European and American clients to withdraw funds. While Bennett sees potential to woo super-rich customers in Nigeria, Ghana, Kenya, Ethiopia, Uganda and Botswana, Credit Suisse is planning to withdraw from 83 markets, including Angola and the Democratic Republic of Congo, to cut costs.

“The UBS strategy has been that you win market share by being onshore and for a long time,” said Sebastian Dovey, managing partner at Londonbased research company Scorpio Partnership. “Credit Suisse is a smaller operation than UBS and is looking to pick its markets.”

UBS Chief Executive Officer Sergio Ermotti is prioritizing boosting profit at the Zurichbased bank’s wealthmanagement unit as he cuts 10,000 jobs and shrinks the investment bank by exiting most debt trading. UBS, which tops Scorpio’s 2012 ranking of wealth managers with double the $855 billion of assets of fifth-placed Credit Suisse, wants that business to contribute half of pretax profit by 2015. The industries contributing most to wealth creation on the continent include telecommunications, consumer, agriculture and resources, said Bennett, 44, who rejoined UBS from HSBC Holdings Plc (HSBA) in 2011.

The number of Africans with at least $1 million of investable assets climbed 9.9 percent to 140,000 in 2012, according to a report published on June 18 by Cap Gemini SA (CAP) and Royal Bank of Canada. That was the fastest rate of increase

From left: Mr. Innocent Azih, Anchor, Agriculture and Food Security Policy Commission, Nigeria Economic Summit Group NESG: Mr. Fatai Afolabi, MD, Foremost Development Services, Ltd., Facilitator, Agriculture and Food Security Policy Commission, NESG and Mr. Frank Nweke II, Director General, NESG. at the NESG and United Nations Global Compact (UNGC) Nigeria Consultation on Sustainable Agriculture Business Principles (SABPs) held in Lagos. outside North America as the economies of countries such as Nigeria and Ghana grew at more than 5 percent last year.

“There are a lot of countries that have become increasingly interesting investment opportunities,” said Bennett, who is targeting Africans with $3 million of investable assets. “They’ve all got challenges, but they’re all on the right trajectory.”

UBS said last month that net inflows from wealthy clients in its emerging markets division, which includes Russia, eastern Europe, the Middle East, Africa and India, slowed in the third quarter. Net new money from those regions was 600 million francs ($660 million) in the period compared with 2.4 billion francs a year earlier, the bank said.

UBS fell 0.3 percent to 16.54 Swiss francs as of 3:27 p.m. in Zurich trading, paring this year ’s gain to 16 percent.

Credit Suisse rose 0.8 percent to 26.32 francs, taking the stock’s advance over the same period to 18 percent.

Credit Suisse, which is scaling back its securities division at a slower pace than UBS, is ending relationships with offshore private banking clients from 83 countries with total assets under management of about 3 billion Swiss francs, Chief Financial Officer David Mathers said last month. The bank didn’t disclose specific countries, which have an average of 40 million francs to 45 million francs of assets.

Compliance Costs

“Given the height and complexity — and compliance costs associated with the numerous regulatory regimes in each country — we have reassessed the viability of doing business in these small markets and believe these resources will be better allocated to other growth areas with higher potential,”

Mathers said.

Vanessa Neill, a spokeswoman for Credit Suisse in London, declined to comment.

The bank will service subSaharan Africa ultra-highnet-worth clients, who have more than 50 million Swiss francs of investable assets, from Johannesburg. Credit

Suisse also has a representative office in Cairo.

“Credit Suisse seems to have taken the view that some of the smaller African countries are not materially advancing the company ’s position,” said Dovey of Scorpio. “It’s refreshing that there are two separate strategies between UBS and Credit Suisse because historically the industry has taken a follow my leader approach and that didn’t always work.”

For the moment, Bennett sees Credit Suisse providing competition in Africa, along with banks, such as HSBC. Wealthy African clients usually book assets in London and Switzerland, David Bruegger, a Zurichbased spokesman for HSBC’s private bank, said in an emailed response to questions.

“We reckon that there is potential for selective growth in the African emerging markets, primarily South Africa, Nigeria and Kenya, for international banking, subject to local cross-border regulatory requirements,” said Bruegger. HSBC declined to provide figures on net inflows or client numbers.

Nigeria, the continent’s biggest oil producer and second-largest economy after South Africa, may expand 6.75 percent next year, the country’s Finance Minister Ngozi Okonjo-Iweala said last month.

Why Africa’s financial integration is difficult

BY TONY NAVAH OKONMAH

T

here have been talks of Africa’s financial integration for more than two decades, but there aren’t any concerted, credible and encouraging signs that Africa is nearing its goals and objective of financial integration apart from a few disjointed accounts from various analysts’ opinions on Africa’s regional financial integration achievements.

Analysts have argued that African regional economic communities (REC), recognising the need for pooling of financial resources began establishing subregional capital markets in an attempt to solve the problem of their fragmented capital markets. Realising the fact that there is a strong relationship between developed financial markets and economic growth, African regional economic communities (REC) saw the need to integrate and consolidate financial markets as a vehicle for promoting

economic development on the continent. REC also believed that financial integration would enhance, promote efficiency and productivity and facilitate the flow of information. Indeed, regional financial integration is seen as the only platform for establishing stronger links with financial systems and capital markets in more developed countries and economies.

But, has REC been able to establish this stronger links or has it the capacity to establish this stronger links with financial systems and capital markets in more developed countries? Kuper, S. (2013) argued that since 2000, Africa has been going off in different directions. President Jacob Zuma, the South African president, in a speech while speaking on issues of toll roads recently lends credence to Kuper’s claim, and it is one of the reasons why Africa’s financial integration has proved difficult. “We can’t think like Africans generally, we are in Johannesburg. This is Johannesburg. It is not

some national road in Malawi”. If indeed, the belief of REC is to enhance, promote efficiency and productivity within regional communities, I do not see how Zuma’s statement meets this objective.

Ironically, South Africa and Malawi are both members of the same African regional economic community called Southern African Development Community (SADC) where South Africa dominates the region economically, accounting for 60 per cent of SADC’s total revenue and about 70 per cent of SADC’s GDP. Evidently, South Africa has a critical role to play in the regional financial integration of that region. Therefore, such careless utterances of a high political figure like the president of South Africa which ridicules the economic and social development of a member country will not promote the desired cooperation that encourages positive and strong financial integration of that region and Africa as a whole.

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32 — Vanguard, MONDAY, NOVEMBER 25, 2013

Homes & Housing Finance BRIEFS JPMorgan’s $13bn mortgage deal a soft landing

J

PMorgan Chase & Co. (JPM)’s record $13 billion deal to end probes into mortgage-bond sales may save the bank billions more because of what the agreement lacked, an explicit admission of wrongdoing.

Employees of JPMorgan and two firms it acquired knew some of the loans included in bonds didn’t meet underwriting standards, a fact not shared with buyers of those securities, the US Justice Department said in a statement. That doesn’t mean the company misled investors, said Chief Financial Officer Marianne Lake, disputing how some state and federal officials characterized the deal.

JPMorgan, the biggest US bank, sought to end one of the largest legal uncertainties it faced without providing fodder to private litigants. The firm is still the subject of Justice Department probes into its energy-trading business, recruiting practices in Asia and its relationship with Ponzi scheme operator Bernard Madoff.

US mortgage rate slides to 4.22%

A

verage US rates on fixed mortgages declined last week after two weeks of increases, keeping home-buying affordable.

Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan fell to 4.22 percent from to 4.35 percent. The average on the 15-year fixed mortgage dipped to 3.27 percent from 3.35 percent.

Rates had spiked over the summer and reached a twoyear high in July on speculation that the Federal Reserve would slow its bond purchases later this year. But the Fed held off in September and now appears poised to wait at least a few more months to see how the economy performs. The bond purchases are intended to keep long-term interest rates low.

Mortgage rates tend to follow the yield on the 10-year Treasury note. They have stabilized since September and remain low by historical standards. Still, mortgage rates are nearly a full percentage point higher than in the spring.

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•An affordable housing development in Ikorodu

Nigeria needs housing finance at 10% of GDP —MBAN ...Up from current 0.5%

By YINKA KOLAWOLE

T

o adequately tackle shortage of affordable housing in Nigeria, there is an urgent need to increase the level of housing finance in Nigeria to 10 percent of Gross Domestic Product (GDP) from its current level of 0.5 percent.

President, Mortgage Banking Association of Nigeria (MBAN), Mr. Femi Johnson, stated this last week, in Lagos, in his welcome address at the 3rd MBAN Housing Finance and Investment Conference and Exhibition, MBAN-HOFEX 2013, with the theme, “Mortgage Banking - A

Catalyst for Capital Market Growth in Nigeria”.

Johnson asserted that to attain that level, deliberate policies must be put in place and well executed to ensure the development of more robust housing finance systems in the country. His words: “Achieving this would require the creation of more resilient housing finance systems. Thus, channelling long-term capital into housing is a major priority, yet, our progress in ensuring this, is very very low.”

He noted that a well functioning housing finance system is imperative for a properous economy, adding that it plays an important role

in stimulating economic growth and job creation. He further remarked that the inadequacies of the country’s current housing finance systems are reflected in the slums across the nation.

According to him, ensuring the necessary investment to meet the housing finance and delivery challenges will depend to a larde extent on the ability to mobilise asequate long-term finance from various sources, including the capital market.

The MBAN president noted that the challenges currently being faced by mortgage banks include how to design new, innovative, and flexible products and instruments for

Fashola charges experts to tackle building collapse

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agos State Governor, Babatunde Fashola, has called on professionals in the built environment to ensure that they take measures that would curtail the incidence of building collapse in the country.

Fashola made the call when members of a Tribunal of Inquiry set up to look into incidents of collapse of buildings in the state, led by its chairman, Mrs Abimbola Ajayi, submitted its report. He called on professional bodies to ensure that any of its members indicted in cases of collapsed building is appropriately sanctioned, noting that quacks will only take over the jobs of the professional if they abdicate

their responsibilities.

The governor said the state government will endeavour to implement the recommendations in the report. “The white paper will be released very soon to ensure that cases of collapsed building are mitigated. The construction sector of our economy is where there are specialised professionals.

And I believe that many of the challenges facing the country are created by people and if professionals do more, we can solve the problems.

“There are usually mild challenges and they can be solved by men and women especially people who have the right skill. From your report, it showed that after the

white paper is issued, the state ministry of justice, police, professionals and all those involved in building activities will have roles to play in ending collapse of buildings.

“It is the responsibility of government to ensure that no life is lost in circumstances that are avoidable. For us, human life is very important and it is the most important gift that we have. And we will do everything within our capacity to protect and nurture it to its fullest capacity. The solution to end incidences of collapsed building requires everyone to stand up. And I hope that the professional bodies in the sector will play their own part,” he stated.

potential house owners to help them achieve their goals of home ownership. “For housing finance, we need to make sure that it manages risk, safe guards assets, and serves the needs of the people,” he added.

Johnson further stated: “There are numerous solutions and approaches to fostering housing finance.

Mortgages are not always the most appropriate financing instrument for every borrower.

Home improvement loans or selfconstruction loans may be more appropriate in some cases to meet housing needs of the poor.”

In a goodwill message delivered on behalf of Central Bank of Nigeria (CBN) Governor, Lamido Sanusi, the apex bank’s Director, Other Financial Institutions Department (OFID), Mr. Femi Fabanwo, said there are four key pillars in the housing value chain, namely keeping down the cost of building materials, providing an enabling environment, a vibrant primary mortgage market, and putting in place a secondary market to off-load liabilities of the primary market. He noted that not many of the 82 primary mortgage banks (PMBs) are strong enough to give mortgages. According to him, mortgage assets to total assets ratio of all the PMBs is just 20 percent. This means that only 20 percent of loan portfolios of PMBs are devoted to mortgages, which is their core business.

Vanguard, MONDAY, NOVEMBER 25, 2013 — 33

Micro - Finance

By PRINCEWILL EKWUJURU

LAPO maps out 5 yrs growth plan

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APO Microfinance Bank Limited, in partnership with AFOS, a management development company, said it has developed a five year plan to move the bank to the pinnacle of micro banking in Nigeria.

The five years plan, 2013 to 2017, is tilted towards the enhancement of the human resources potential of its staff, the bank said.

Dr. Kenneth Achu, a board member of the bank who gave insight on the training program revealed at the graduation of the first batch of the management trainees of the bank in Lagos, while speaking on the topic: LAPO Human Resources; Challenges and Perspectives for the implementation of the five year strategy 2013-2017, said the bank’s strategic plan is in five folds of Technology, Product development, Client relationship, Capacity development and staff relationship. He said that it is to help grow the profile of the bank and Nigeria’s economy in particular.

Chief Executive Officer of the bank, noted that in the past few years a set of initiatives have been embarked upon to position LAPO as a first class financial institution with strong systems and human capacity to effectively engage clients, develop and deliver quality

products and services and achieve superior performance. “We identify technology, product and services, client relationship, staff relationship and performance management.”

Continuing, he said: “the future of LAPO particularly, in the implementation of its current 5- year strategy shall

be shaped by the level of capacity development efforts.

Interestingly, we have always placed premium on staff capacity development, this is evident in the huge investment in training and establishment of full-fledged academy.”

“In the past few years, we

have in a strategic manner focused our capacity building efforts and attention on mid-level managers.

In 2011, we enabled 34 mid-level managers to benefit from a US management training from Nigerian Franchisee.”

From Left: Mrs. Osaretin Demuren , Former Director of Human Resources, Central Bank Nigeria, [CBN], and Director of ESG on LAPO Board of Directors, Mr. Oluwaseyi Amasha, Management Trainee Graduate, Mr Godwin Ehigiamusoe; Managing Director of LAPO, Dr. Biodun Adedipe, Chief Consultant B.Adepide Associates Limited (BAA consult) and Mr Bernhard Vester, Managing Partner/ consultant AFOS. During the Gradution Ceremony of LAPO Microfinance Banks Management Trainnee Programme, held recently in Lagos.

PHOTO; Kehinde Gbadamosi

BRIEFS Govt urged to strengthen apex bodies to handle microfinance industry

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he Director, Bio-fuel and Renewable Energy Fund, Dr. John Hene, has called on Government to collaborate with development partners to institute a scheme to strengthen apex bodies to handle their roles in the microfinance industry.

Speaking at the 3rd Annual General Meeting of the Association of Financial NonGovernmental Organisation (ASSFIN) in Accra ,Hene said that such an assistance or facilities would not be for credit but capacity building and institutional development.

He said the microfinance sector deserved greater attention than it was accorded now, if only the country was determined to fight the epidemic of poverty.

“We need as a nation to recognise that the industry is still at its teething stage and has not yet reached the weaning stage,” he added.

He said facilities and requisite support should be put in place to enhance growth and development without sacrificing efficiency, effectiveness and affordability.

First Bank kick off SMEs conference tomorrow Stories by PROVIDENCE OBUH s

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irst Bank Nigeria Plc, has announced its maiden edition of SMEs conference, with a view to empowering entrepreneurs and SMEs in the country.

The conference , which will highlight challenges and opportunities for small businesses is scheduled to begin tomorrow November 26, , with the theme: “SMEs at the heart of National Development: Creativity, Capacity and Capital”.

The critical role of SMEs as the engine of growth in the economy, providing employment to thousands of people and contributing significantly to the gross domestic product (GDP) makes the conference a timely platform for repositioning the nation’s SMEs for sustained growth, said, Executive Director Retail Banking South, First Bank, Mr. Gbenga Shobo.

Shobo added that the conference will have two panel sessions that will address access to capital, leveraging creativity and

deepening capacities, among others.

“Creativity is at the heart of entrepreneurship and all SMEs require some measure of this to birth their companies and continue to evolve and grow their businesses. Growth is not possible without building capacity in each sector by the acquisition of necessary skills and human resources to drive the business.

“Expansion can only be funded by acquiring the capital to invest in the business and take it to the next level of operation,” she said.

Lagos State Gover nor, Babatunde Fashola will play host, Minister of Trade, Industry and Investment, Mr. Segun Aganga, Guest of Honour, while CEO, SOKOA Chair Centre, Mrs. Ibukun Awosika and CEO, Konga.com, Mr. Sim Shagaya are keynote speakers.

Awosika is an entrepreneur and founder of Chair Centre Group with an experience in manufacturing and retail services that will drive conversations around capacity development in the sector and

the opportunities available to entrepreneurs across the entire retail value chain.

Shagaya, is founder of

Konga.com and DealDey.com, with 11 years of management and entrepreneurial experience.

WIMBIZ encourages women on changing trend

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he Women in Management, Business and Public Service, has urged thier counterparts in the country to embrace change.

WIMBIZ is a Nigerian non-governmental organisation with a vision to be a catalyst that elevates the status and influence of women and their contributions to nation building.

“As the economy and the world around us change, WIMBIZ too is evolving to create an organisation relatable to the 21st century woman. Like the women we represent, it is important that we stay on top of current trends. It is not the strongest of the species that survive, not the most intelligent, but the one most responsive to change,” said, outgoing Chairperson, WimBiz, Mrs. Adeola Azeez.

Azeez added: “With the right tools and mentorship, we have seen the Nigerian woman flourish and with every life that we have touched through this organisation comes the renewed clarity that WIMBIZ makes things happen.”

Keynote speaker, Mrs. Omobola Johnson said that the telecommunication and ICT were key in the new economy, emphasising the importance of one’s ability to gather information and use the knowledge as well as connecting with one’s environment through telecoms and ICT. Johnson attributed that the tangible and non-tangible are new commodities in the new economy.

Orbis opens £2.5m pot for SMEs

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rbis Energy has launched a £2.5m grant programme to support small to medium-sized businesses in the offshore renewable energy supply chain in the east of England.

The scheme, part-financed by the European Regional Development Fund, will offer grants of between £2500 and £50,000 to companies bringing “ new products, processes and ideas to market”, as well as increasing the “capacity of existing innovative products and services”.

Lowest oft-based Orbis Energy business development lead Johnathan Reynolds said: “This programme will make the difference for the businesses keen to drive forward their new ideas, developing their innovative technologies and invest in their own future.”

NWES project manager Richard Salmon added: “We are not just looking to support businesses that have a new product with a patent; we are also working with businesses offering a service in a different way and essentially solving problems faced by this emerging industry.”

34 — Vanguard, MONDAY, NOVEMBER 25, 2013

Appointment and Promotions vicahiyoung@yahoo.com 08033348923

NACETEM names Muhammed Acting DG

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fellow of the Nigerian Institute of

Management, NIM, Yusuf Muhammed, has been named the Acting Director General, DG, of the National Centre for Technology Management, NACETEM. He was until his

appointment director of the North West Zonal Office of the agency and replaced Dr. Willie Siyanbola, who had been the Director General of the center for 9 years.

THE acting DG was announced at the Obafemi Awolowo University, OAU, Ile Ife, headquarters of the center

British Airways to recruit more female pilots

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ritish Airways’ cadet training programme is in its third successful year and with a week to go until applications close; the airline is appealing for more female applicants.

The airline’s ‘Future Pilot Programme’, an 18-month pilot training course, has proved extremely popular and has attracted about 5,000 applicants for less than one hundred places in its first two years.

The programme helps applicants to gain a place at an approved flight training school, with successful candidates getting a job as a British Airways pilot.

The top-flight cadets will start their training, at one of three British Airways approved flight training schools in Oxford, Southampton and Jerez in Spain.

During their training, students complete their ground theory training, cockpit instrument rating and flight training, flying light aircraft in Spain, New Zealand or Arizona in the US. The final two months of the

programme is completed on British Airways’ multi-million pound simulators at the airline’s flight training centre near Heathrow, where the cadets will learn to achieve and maintain British Airways’ high standards.

British Airways’ director of flight operations, Captain Stephen Riley, said: “This is an exciting period for our Future Pilot Programme initiative. We are taking applications for the third year running and I’m proud to say our first ever cadets are also in the final stages of their course.”

after a board meeting, attended by staff and top management members.

The meeting was chaired by Senator Ben Collins Ndu, who is also the chairman of NACETEM. Other members in attendance were: Mrs Goddy Ogbogun, Chief Alfred Douglas Naingba, Mrs Ladi Maman Watila and the outgoing DG, Dr. Willie Siyanbola.

Earlier, the board members had paid courtesy visit to the Ooni of Ife, Oba Okunade Sijuade and later to the Vice Chancellor of OAU, Professor Bamitale Omole.

Speaking at the monarch palace, Senator Ndu restated the resolve of the center to

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(Operations) responsible for Manufacturing, Process, Maintenance and Factory Automation systems in Eternit Limited.

According to the Managing Director, the new division would take responsibility for all construction projects handled by Eternit Limited, both operational and managerial particularly Modu Build, suspended ceiling system, steel roofing structures (Ultraspan and Ultralight), Dry construction (walling and partitioning) and other products such as concrete tiles and clay tiles manufactured and sold by Eternit Limited.

Modderman said “the new division will stand on three functional departments to be

•Yusuf Muhammed otherwise known as Center for Historical documentation and Research.

Before his appointment as Acting DG, he was the most senior director of the center.

UFOT now corporate champion for global health

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riends Africa has appointed the Group Managing Director of SO&U Limited, Mr Udeme Ufot Corporate champion for global health.

Mr .Ufot now joins a list of prominent industry leaders, companies and individuals from around the world who are breaking new grounds and positively impacting their communities and the development of health on the continent.

Past awardees include Mr Chris Kirubi, Dr .Brian Brink; Mr. Ken Ofori-Atta among others.

Dr. Akudo Anyanwu Ikemba, Chief Executive Officer, CEO, Friends Africa, while speaking on the appointment said “We have observed with keen delight his sterling leadership performance and numerous

Eternit appoints Malvis GM Business headed respectively by a Devt Business Manager ternit Limited, a Housing solution provider has announced the appointment of Bemigho B Malvis General Manager, Business Development.

The company in a statement by its Managing Director, Mr. Dirk Modderman, said the creation of this Business unit was a strategic response to realities and demands in the Nigerian building industry.

The Sapele, Delta State based company said that the choice of Malvis was as a result of his professionalism as held various important positions since August 1995 when he joined Eternit Limited to date.

Before his appointment, he was the General Manager

advance the nation’s technology and join hands with President Goodluck Jonathan to build an enviable nation.

The chairman also commended both the royal father and the university administrator for being good hosts.

Muhammed, is a trained accountant and fellow of both the NIM and Nigeria Institute of Public Relations, NIPR. Before he was appointed the director of the South West Zonal Office, Lagos, in 2006, following the approval of Dr. Siyanbola’s recommendation, he had worked with the Federal Radio Corporation, Kaduna and Arewa House,

responsible for Project prospecting and sales, the Project Development Manager covering the project engineering and Field Services Manager who work with his team for project realization.”

•Bemigho B Malvis

•Udeme Ufot contributions and these have made him an outstanding choice for this elite group. We believe he will bring his experience and influence to bear in the advocacy for a healthier continent’.

“Our Corporate Champions for Global Health are guided

by Friends Africa’s vision and

values based on the United Nations Millennium Development Goals, with priorities given to: Reducing Child Mortality, improving maternal health and combating HIV/ AIDS, Malaria and other diseases”.

She also notes that these are persons who do their utmost to mobilize support to combat pandemics using their unique abilities to touch people’s lives with their passion and commitment Reacting to his selection, Ufot expressed delight at the honour bestowed on him by Friends Africa.

According to him, “I am really honoured to be a part of such an elite Global health group. It is a rare priviledge and there is no doubt it offers a veritable platform to continually add value and contribute my quota towards the making of a healthier Africa”

MINILS holds fellowship award Nov 28

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HE Ninth edition of Michael Imoudu National Institute for Labour Studies, MINILS, Ilorin, Kwara State, annual National Labour Relations Summit and Fellowship Award will hold on Thursday, November 28, 2013.

A statement by Mr. Wale Ibrahim, Deputy Director/Public Relations, on behalf of the Director-General/Chief Executive, MINILS, said the theme of the year’s Summit was “Labour Laws, Institutional Reforms and the Development Process in Nigeria” According to the statement “This year’s edition of this important annual gathering of critical stakeholders will be focusing on the impact of legal-institutional frameworks and instrument(s) on labour relations and development efforts in Nigeria, as well as the contribution of critical actors in the Nigerian Industrial Relations system in terms of defining theses processes.

An erudite law scholar and eminent Jurist, His Lordship, Justice Benedict Kanyip, PhD of the National Industrial Court of Nigeria will speak on “Labour Laws, Participatory Democracy and the Development Process in Nigeria: Issues, Challenges and Prospects”.

Vanguard, MONDAY, NOVEMBER 25, 2013 — 35

Aviation highest standards of safety.

Safety cannot be compromise.

On safety and security at the nation’s airport, She said, “If the securities of our airports are regularly violated, it means our airports are porous or we are not being diligent enough. So, we should look closely at security.

However, I don’t know how secured our airport borders are because that is the only route we can have intrusion into the airports by those who are not supposed to be there.

From Left; Lagos State Commissioner for rural Development, Cornelius Ojelabi, Chairman Olorunda LCDA Hon. Abudu Amida,Chairman, Community Development Committee, Evang.

Ezekiel Ogunyemi and Special Adviser to Governor Babatunde Fashola on Rural Development,Mr. Babatunde Hunpe at the handing over of Igbanko Rural Electrification projects to Igbanko Community in Olorunda LCDA to commemorate the year 2013 community day celebration , PHOTO; Kehinde Gbadamosi

You don’t ground an airline to do auditing —Odutola Stories By LAWANI MIKAIRU

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former Director, Airworthiness and Operation Standard, Nigerian Civil Aviation Authority, NCAA, and former Rector , Nigerian College of Aviation Technology, Zaria, and former Director, Air Transport Bureau of International Civil Aviation Organization, ICAO, in Montreal, Canada, Mrs Folasade Odutola has said the Nigerian Civil Aviation Authority, NCAA, does not need to ground an airline in order to carry out operational audit on the airline.

Odutola said this while fielding questions from aviation reporters on the current state of aviation industry in the country and her new book, The Big Conspiracy which will be presented to the public soon in Lagos. She said what is required is for the safety auditors to use the “check list” to evaluate the aircraft and know the airworthiness of the plane. This is the same check list used before a certificate of airworthiness is issued.

It will be recalled that Dana Air has been grounded since October 6th, 2013. The Nigerian Civil Aviation Authority, NCAA, directed the management of Dana Air to immediately suspend its flight operations to allow for an ‘operational audit of the airline’. The airline complied without delay. The Director General of NCAA had said the audit was to be an industry-wide exercise for all

local operators, with Dana Air as the first airline to be so audited Odutola said grounding an airline sends out the wrong signal and creates the impression that the airline is not healthy and therefore cannot operate flights.

According to her “ You can only ground an airline base on the findings of a safety audit . It is the final report of the audit that determines if the airline should be grounded or not. Check list is used to audit an airline.”

On the autonomy of NCAA, the former Rector who has just authored a book on aviation titled “The Big Conspiracy” said it is not necessarily how autonomous the NCAA is that determines how effective the

agency will be, but the integrity and determination of whoever heads the regulatory agency that determines how effective the agency will be in discharging its duty. She however said there should not be interference in the technical duties of the agency especially those concerning safety.

According to her “ NCAA is a parastatal in the Federal Ministry of Aviation and so there is bound to be checks and supervision from the ministry. But who ever heads the ministry should not interfere in the day to day discharge of the technical duties of the regulatory agency especially those that concern safety. Civil aviation thrives on maintaining the

“I believe that for someone to get to the aircraft, he must have a ticket and if someone without a ticket gets to the aircraft, it shows there are lapses in security system and we should tighten up or block those gaps, definitely, there are lapses, otherwise we won’t have stowaways. Anybody who can do that can equally plant bombs within the airports or put guns inside the aircraft. Whatever we have to do to improve security within the airports should be out in place.

Odutola’s new book on aviation The Big Conspiracy talks about “the travails of a progressive safety regulator in a not-soprogressive aviation industry “ It is a chronicle of some of her experiences as an aviation executive which span 35years.

She said “The Big Conspiracy is about my experience in the aviation industry which I consider very amazing and interesting enough to share with all and sundry. It details my ordeals as a regulator, both of safety and economy but mostly of safety, in a morally challenging environment that existed and , most unfortunately still exist in Nigeria.”

Charter airlines are operating —NAMA N

igerian Airspace Management Agency, NAMA has denied the allegation that nonscheduled airlines, private jet operators, have shut down their operations in protest against the new aviation charges introduced for the use of general aviation terminals at the nation’s airports.

The Managing Director of the agency, Engineer Nnamdi Udoh said “ that the allegation was false as serious non- scheduled operators are still operating their normal flights at our various airports.

The few operators who could not operate are those who are yet to comply with the new

regime.” ”As of midday today,{Thursday) more than 30 operators have paid the requisite fee and are freely enjoying our services.The charges are in compliance with section 30(2) (9) and (c) of the Civil Aviation Act of 2006.”

Udoh further said “The charges are jointly collected on behalf of all agencies that provide services at our newly constructed and designated private terminals in Lagos, Abuja and 11 other airports where these private terminals would be constructed. In the past, non-scheduled airlines paid different charges to different aviation agencies for the services they render

them, with the attendant bottlenecks associated with such arrangement. “ “Today, when a nonscheduled airline pays this new charge, it does not need to pay other separate charges to any of the service-providing agencies anymore. The new charges constitute a luxury tax, which is acceptable internationally for the type of services offered by private jet operators, and it is used to maintain highly exclusive facilities provided at these luxury terminals, including limousine services (as in the case of Nnamdi Azikiwe International Airport, Abuja)

BRIEFS Aviation experts fault NCAA inability to make domestic airlines viable Stories By DANIEL ETEGHE

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he Nigerian Civil Aviation Authority (NCAA) has been accused by experts in the aviation industry of not making Nigerian airlines viable and capable of facing competition amongst airlines in the subregion and across the world.

The experts argue that airlines in the aviation industry in Nigeria are dying because of lack of cooperation amongst the operators stressing that it was the duty of the regulatory body, NCAA to see that the situation was savaged.

President and Chief Executive Officer of Sabre Travel Network, Mr. Gabriel Olowo said that the main reason why Nigerian airlines were not viable was the inability of NCAA to midwife the process of collaboration and merger amongst the domestic airlines.

Speaking at the Aviation Safety Seminal 2013 organised by Aeroconsult Limited with the theme: Strengthening Safety in the Nigerian Aviation Sector at the Murtala Muhammed Airport, Lagos.

MedView Airlines airlift 339,043 passengers in one year

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edView Airline has declared that it airlifted about 339,043 passengers in one year since it started operations on the domestic scene in Nigeria.

This is coming just at the airline celebrated its one year anniversary last week with a visit to a number of charity homes to give succour to the motherless and the aged.

Managing Director of MedView Airlines, Alhaji Muneer Bankole said that the airline started its operations on the Lagos-Abuja route and has since expanded its operations as one of the best on the Port Harcourt, Yola and Enugu routes.

He said “The airline started domestic operations on November 8, 2012 on the Lagos- Abuja route, and added Port Harcourt, Yola and Enugu to its schedule, flying a total of 339,043 passengers within the period. But rather than roll out the drums to celebrate, the airline chose a more honourable way by visiting a number of charity homes to give succour to the motherless and the aged” C M Y K

36 — Vanguard, MONDAY,NOVEMBER 25, 2013

Tax Matters

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olden Noodles Nigeria Limited, has joined the league of Quality Management System certified companies when it was formally presented with certificate of conformity to the requirements of NIS ISO 9001:2008 for maintaining good quality standards.

Presenting the certificate to the company in Lagos the Director General/Chief Executive, Standards Organisation of Nigeria (SON), Dr. Joseph Odumodu, described the certification as giant step in the pursuit of excellence to providing not only quality food, but food that is safe for its consumers.

Odumosu, who was represented by the organisation’s Deputy Director, Trade Development, Mrs. Oluremi Ayeni, stated that the issue of food and its global security had become a major concern to the entire world, a development, he stated, had led to the emergence of several policies aimed at addressing the quality and safety of food with the attendant reduction in food scare and supply chain concerns.

LAIF ends, Insight, 3XM & Noah’s Ark scoop gold medals

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he Nigerian creative industry are not lagging in the quality of works they dish out for their clients as six of their works scooped gold medals at the just ended 2013 Lagos Advertising and Ideas Festival (LAIF) held in Lagos.

Several other creative works by different agencies won silver and bronze medals at the awards which started in 2006 to encourage Nigerian agencies on their creative works. Four of Insight Communications creative works won gold while X3M Ideas, a new agency which started operations a year ago and Noah’s Ark won gold also for their creative exploits.

Insight Communications spearheaded by Biodun Shobanjo, Chairman of the Troyka Group won three gold medals in the radio category and another in the Special Category.

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ax avoidance is a process whereby an individual plans his or her finances so as to apply all exemptions and deductions provided by tax laws to reduce taxable income. It entails the legal utilization, using of the tax regime to one’s own advantage, in order to reduce the amount of tax that is payable by means that are within the law. It is the process whereby an individual plans his or her finances so as to apply all exemptions and deductions provided by the tax laws to reduce taxable income.

Most taxpayers use some forms of tax avoidance. For example, individuals who contribute to employersponsored retirement plans with pre-tax funds are engaging in tax avoidance because the amount of taxes paid on the funds when they are withdrawn is usually less than the amount that the individual would owe today.

Furthermore, retirement plans allow taxpayers to defer paying taxes until a much later date, which allows their savings to grow at a faster rate.

The term tax planning and tax mitigation is a synonym for tax avoidance. It was originally used by tax advisors as an alternative to the negative term ‘tax avoidance’. The term has also been used in the tax regulations of some jurisdictions to distinguish tax avoidance foreseen by the legislators from tax avoidance which exploits loopholes in the law.

Through tax avoidance, an individual takes advantage of all legal opportunities to minimize his or her state or tax. An individual may, for example, avoid federal income tax by investing a large sum of money in state bonds, since the interest on such bonds is not considered taxable income on which federal tax is due.

A taxpayer may lawfully arrange his/her affairs to minimize taxes by such steps as deferring income from one year to the next. (For

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Golden Penny bags NIS ISO 9001:2008 certification

Illegal tax practice: Tax avoidance and tax evasion example, interest on property sold on 31st of December 2012 is taxable as part of 2012 income. If the property is sold on 1st January 2013, it would be taxable as part of 2013. This is legal to do.) It is lawful to take all available tax deductions. It is also lawful to avoid taxes by making charitable contributions.

One way a person or company may lower (avoid) taxes is by changing one’s tax residence. This is usually

,

BRIEF

avoid tax, it is usually not enough to simply move one’s assets to a tax haven, one must also personally relocate to a tax haven.

Without changing country of residence, personal taxation may be legally avoided by the creation of a separate legal entity to which one’s property is donated.

The separate legal entity is often a company, trust, or foundation. Assets are transferred to the new

It is lawful to take all available tax deductions. It is also lawful to avoid taxes by making charitable contributions.

accomplished by relocating to a tax haven, (countries with low or negligible tax rates, usually done to attract investors) or by becoming a perpetual traveler. However, some countries, such as the U.S.A tax their citizens, permanent residents, and companies on all their worldwide income. In these cases, taxation cannot be avoided by simply transferring assets or moving abroad.

Most countries impose taxes on income earned or gains realized within that country regardless of the country of residence of the person or firm. Most countries have entered into bilateral double taxation treaties with many other countries to avoid taxing nonresidents twice—once where the income is earned and again in the country of residence. However, there are relatively few double-taxation treaties with countries regarded as tax havens (countries with low or negligible tax rates, usually done to attract investors).To

By contrast, tax evasion is the general term for efforts by individuals, firms, trusts and other entities to escape (dodge) taxes using illegal means.

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company or trust so that gains may be realized, or income earned, within this legal entity rather than earned by the original owner. If assets are later transferred back to an individual, then Capital Gains Taxes would apply on all profits.

The company/trust/ foundation may also be able to avoid corporate taxation if incorporated in an offshore jurisdiction (countries abroad). Although income tax would still be due on any salary or dividend drawn from the legal entity. For a settlor (creator of a trust) to avoid tax, there may be restrictions on the type, purpose and beneficiaries of the trust. For example, the settlor may not be allowed to be a trustee or even a beneficiary and may thus lose control of the assets transferred and/or may be unable to benefit from them.

Tax results depend on definitions of legal terms which are usually vague. For example, vagueness of the distinction between “business expenses” and “personal expenses” is of much concern for taxpayers and tax authorities. More generally, any term of tax law, has a vague penumbra, (confine) and is a potential source of tax avoidance By contrast, tax evasion is the general term for efforts by individuals, firms, trusts and other entities to escape (dodge) taxes using illegal means. Tax evasion usually entails taxpayers deliberately misrepresenting or concealing the true state of their affairs to the tax authorities with the intention

of reducing their tax liability.

It particularly includes, dishonest tax reporting (such as declaring less income, profits or gains than actually earned; or overstating deductions).

Tax evasion typically involves failing to report income, or improperly claiming deductions that are not authorized. Examples of tax evasion include such actions as when a contractor “forgets” to report the N100, 000 cash he receives for building a pool, or when a business owner tries to deduct N100, 000 of personal expenses from his business taxes, or when a person falsely claims she made charitable contributions, or significantly overestimates the value of property donated to charity. Similarly, if an estate is worth N5 million and the executor files a false tax return, improperly omitting property and claiming the estate is only worth N1 million, thus owing much less in taxes, he has evaded taxes.

Tax evasion is an activity commonly associated with the underground economy. One measure of the extent of tax evasion is the amount of unreported income, namely the difference between the amount of income that should legally be reported to the tax authorities and the actual amount reported.

Some of those attempting not to pay tax believe that they have discovered interpretations of the law that show that they are not subject to being taxed. These individuals and groups are sometimes called tax protesters. An unsuccessful tax protestor has been attempting openly to evade tax, while a successful one avoids tax. Tax resistance is the declared refusal to pay a tax for conscientious reasons (because the resister does not want to support the government or some of its activities). Tax resisters typically do not take the position that the tax laws are themselves illegal or do not apply to them (as tax protesters do) and they are more concerned with not paying for particular government policies that they oppose. Tax evasion is a crime in almost all developed countries and subjects the guilty party to fines and/or imprisonment.

Conclusively, John Maynard Keynes was not wrong to have postulated that ‘the avoidance of taxes is the only intellectual pursuit that carries a reward.’ However, it is worth noting here that the difference between tax avoidance and tax evasion is just but the thickness of a prison wall.

Vanguard, MONDAY, NOVEMBER 25, 2013 — 37

International Biz News

Global economic recovery stumbles as Europe, China falter

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usiness surveys released last week has shown that global economic recovery took a step backwards this month as businesses across the euro zone and China’s vast factory sector continued to grow at a slower pace.

The survey further revealed that while growth in Germany was resurgent, French business activity took a tumble and contracted,

underlining how lopsided the euro zone’s recovery from recession is.

Patchy recoveries in developed countries meant demand for China’s manufactured goods from abroad fell to a three-month low in November, bolstering expectations that the world’s second largest economy could lose some vigor this quarter.

Analysts say, this is evidence to suggest the

European economy is struggling to gain momentum and the Chinese numbers certainly were not great.

They predict that there will be an okay rebound in the course of the next year but not as strong as once thought, arguing that a lot is going to depend on how the United States holds up.

“In a nutshell, today’s PMI figures confirm that the euro zone economic momentum has lost

some steam. The stabilization in domestic demand remains fragile and a solid recovery seems to be some way off,” Reuters quoted Annalisa Piazza of Newedge Strategy as saying.

Across the Channel, Britain’s finances showed an improvement last month as stronger economic growth and a recovering housing boosted tax revenues, although it failed to live

up to even the most pessimistic forecast in a Reuters poll.

On the other hand, a further review of the Chinese market showed a slight improvement as the Chinese Flash Markit/ HSBC PMI fell to 50.4 from October ’s final reading of 50.9, but for a fourth consecutive month remained above the 50 line.

“Today’s PMI report underpins our view that

Chinese economic growth momentum may have peaked in the third quarter. Looking ahead, we also stick to our assessment that growth will slow further next year,” said an analyst, Nikolaus Keis.

Global Road Traffic injuries cost $518bn annually, Says Keystone Bank MD

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anaging

Director/Chief Executive, Keystone Bank Limited, Mr. Philip Ikeazor yesterday estimated the global annual cost of road traffic injuries at $518 billion. The low and middle income countries accounted for $65 billion of the total figure.

He disclosed this yesterday in Abuja at the official launch of the bank’s CSR initiative tagged “ Eye and Health Screening for Commercial Bus Drivers” in collaboration with the Federal Road Safety Corps (FRSC), The Eye Foundation and Public Health Partners.

He said the bank had resolved to support the transport sector in order to help improve road safety and save lives.

Justifying the bank’s intervention in the sector, Ikeazor, while quoting statistics from the International Federation of Red Cross and Red Crescent, said road crashes had become the leading cause of death for youths aged 15-29 years. He said Nigeria accounted for over 85 percent of global deaths from road crashes.

The Keystone Bank boss said the new initiative would provide free screening to interstate commercial transport drivers for diabetes, hypertension, cholesterol as well as ascertain their level of blood group.

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38 — Vanguard, MONDAY, NOVEMBER 25, 2013

Vanguard, MONDAY, NOVEMBER 25, 2013 — 39

Advertising, Media & Marketing STORIES BY PRINCEWILL EKWUJURU or a company to set a brand above the fray in a fiercely competitive market, the brand must deliver what the consumers expect. And to be considered premium, the brand must be built upon specific tangible and intangible attributes that give it a sense of worth.

Indeed, a brand is only considered premium when consumers believe it is worth the price and arouses the senses in a way that makes the consumers feel indulgent.

Understanding this phrase and knowing that discerning consumers are attractive prospect for any premium brand, Chi Limited, makers of Chivita Premium Fruit Juice, decided to go the extra mile to create top-of-the-mind awareness for the brand among juice lovers in the country by adopting the best technology available in the production of Chivita fruit juice. The result is a 100 percent pure fruit juice which contains no added sugar, no preservative and no added colours.

Great Service from Outsource Employees

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From Left: Chief Strategist, Anthill Investment Limited, Olamilekan Asa-Afariogun, Marketing Manager, GoldenTree Chocolate, Genevieve Pawar and Business Development Manager, Cocoa Processing Company Limited (Ghana), Frank Asante at the unveiling of GoldenTree brand of chocolates in Lagos, recently.

100%fruit juice: What is Chivita doing differently?

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hi Limited did not take the decision on a whim. It was based on a well articulated feedback received from consumers who are finicky about what they ingest and who also desire healthy and natural living. Nigeria’s

StarTimes to transmit more local contents next year

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ith 1.5 million subscribers base, StarTimes, a pay- TV platform, said by 2014 the TV channel will begin to transmit more local content materials, even as the company has added seven new channels.

Mr. Justin Zhang, General Manager, StarTimes, Lagos, who spoke on the newly introduced channels, said plans are in top gear to develop and bring on board additional local content channels that will showcase the preparedness of the platform to grow the interest of Nigerians to the pay- TV platform.

He however listed the additional channels as Fox news, Bloomberg Business TV, Dove TV, Star Africa, Star 1, Star movies 1+2 and Star Chinese.

Corroborating, Mr. Anetor Irete, Public Relations Manager of the company who spoke on the Christmas promo tagged: StarTimes Christmas, Extra Goodies Promo embarked upon by the company, said the promo which commenced on 18 November,2013 will climax on January 31, 2014, both for new and existing subscribers will reward subscriber(s) who buys a new decoder for C M Y K

N5,900 with one month unique bouquet of up to 80 channels or who buys a decoder for N5,900 with one month unique bouquet can get a Yagi antenna with 10 meter cable for N1,000.

On the other hand, existing subscribers can recharge for N3,000 in a day and get free N1,000worth of airtime and a StarTimes Yagi antenna for N1,500, Irete

middle class is growing in bounds.

Among this class, the perception exist that consuming sugar in excess and eating artificial food is injurious to the health. In any case, scientific findings support this view. Thus, Chi Limited invested in latest production techniques for fruit juices that contain no added sugar in order to give the consumer a sense of exclusivity and pride.

Like any business, premium brands must pursue growth strategies. But marketing a premium brand demands that the brand custodian thinks through every facet of the brand experience. This explains why, apart from the juice itself, packaging matters. Attentive customer service also matters. And within the company itself, culture matters. Chi Limited took these into consideration which is why Chivita Premium Fruit Juice has the typical flavour and characteristics of the fruit in the package. Indeed, the company ensures that the fruit juice undergoes a mild transformation process, without disrupting its natural composition.

Close-Up relishes Brand of the Year Award

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lose-Up toothpaste from the stable of Unilever Nigeria Plc has beaten other brands in the market to clinch the Brand of the Year Award at the recently ended Advertising Association of Nigeria (ADVAN) yearly award.

The brand last week commemorated the award with its customers and friends, and instituted “Natural Naija Smile” Contest.

At the event, the brand owners were thankful to consumers for their patronage over the years, and their contributions to making the brand a name to be reckoned with.

In furtherance of its appreciation to its consumers, the brand also used the opportunity to launch the Close Up Herbal, “Natural

Naija Smile” Contest. The contest involves consumers putting up their smiles on the Close Up facebook page, and getting their friends to like the picture. Winners from the competition stand to win two brand new Hyundai cars.

Speaking at the event, Brand Building Director Unilever Nig Plc, David Okeme, stated that Close Up has been leading innovations in the Oral Care market since the 70s and at the heart of the brand is the confidence it gives to people to get close to one another. “It is the market leader in Nigeria and it is driving this campaign to foster social interaction”, he said.

In her speech, Oiza Gyang, Category Manager, Oral Care said that this award is a recognition of marketing excellence and for a campaign that was borne out of a deep understanding of the Nigerian consumers and a celebration of the resilience of Nigerians. “It is an engagement with the youths using

utsourcing is one of the biggest business discoveries in the last two decades. In simple terms, it means handing over the management and execution of some business processes, functions or services to another organisation that has the expertise in handling such things.

In Nigeria, many organisations have discovered that it pays them to outsource security, transportation, call centre operations, customer service, among other things. Even the provision of drivers, security men, bank tellers, receptionists, secretaries, sales staff can all be outsourced.

No doubt, outsourcing has its advantages. It reduces the cost of doing business, allows the client organisation to focus on its core business, brings some expertise into the business and expands employment opportunities.

The flip side though is that, sometimes, it could be a challenge to get outsourced employees to deliver service to the satisfaction of the client organisation and its customers. For instance, sourced security men may not fully appreciate the need to be courteous to customers, bank tellers may be rude, indifferent and slow and drivers may abuse other road users, not minding that they drive branded company vehicles. All this could be as a result of ignorance, poor attitude to work, lack of job satisfaction, lack of motivation to key into the service vision of the company, etc.

Unfortunately, customers don’t care whether the employees serving them are outsourced or not. Once such employees misbehave, it is the organisation that suffers a damaged image.

Here are some tips you could use to get the best out of your outsourced staff.

Organise induction for them ften times, organisations let outsourced employees loose on their customers without proper induction.

This is more often the case with drivers and security men.

It ought not to be so. You need to execute appropriate induction for your outsourced staff. Let them know how you expect them to relate to customers, your own employees, visitors, etc. Show them the way you do things. Share your corporate vision with them and let them see how they can help to achieve that vision.

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Train them ruth is that a lot of outsourced employees have not been adequately trained by their employers. Even when they have been trained, their training may have been too general. You still need to train them from time to time to upgrade their skills. Alternatively, you could get their organisation to train them. In any case, it is still your duty to ensure competent people work for you.

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Define work relationships ometimes, outsourced employees believe they owe allegiance basically to their employer – that is, the supplier organisation. You need to let them know those who have authority over them among your own employees.

They need to have a clear reporting line.

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Monitor their performance ou need to appraise outsourced staff on regular basis to ensure they deliver consistent service to your organisation and your customers. Also pay attention to customer feedback concerning them. It may shock you to discover that your outsourced security men ask for tips from customers before providing parking space.

Sometimes, the security chaps prevent customers from coming to do business.

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Reward top performers t will be a great idea to reward top performers among your outsourced employees. Make them feel that their contributions are appreciated. For instance, while giving end-of-year gifts to your own employees, extend similar gestures to your outsourced staff.

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Exercise your right to fire them on’t hesitate to send those who perform below expectations back to their employer. You cannot afford to keep people with poor attitude to work.

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Treat them like your employees xpect high standards from outsourced employees.

Treat them the same way you’d treat your own employees. It makes no business sense to put up with unacceptable behaviour simply because the culprit is not your regular employee.

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40 — Vanguard, MONDAY, NOVEMBER 25, 2013

Email:lesleba@lesleba.com, lesleba@gmail.com Blog page:www.lesleba.com/blog2 Website: www.lesleba.com Tel:0805 220 1997

and infrastructural needs.

Evidently, therefore, the first object of a socially responsible exchange rate policy in the 2014/16 monetary strategy would be to ensure that the naira exchanges at a rate that would immediately eliminate any form of fuel subsidy.

Thus, if for example, the dollar conversely exchanges for N80=$1, the price of premium motor spirit would immediately fall to below N70/ litre, from the erstwhile market price of about N140/ litre price before subsidy. In addition, a stronger naira would significantly increase the purchasing value of the paltry incomes of all labour; such increased purchasing power will in turn stimulate demand and drive productive industrial growth with increasing job opportunities.

In conclusion, in the light of our impoverished infrastructural base, a realistic and sustainable MTEF must progressively skew capital expenditure from the current level of about 30 per cent to over 50 per cent of total expenditure. Thus, any indication that the current MTEF accommodates more than 50 per cent of budgeted projected revenue as recurrent expenditure must be seen as a clear signal that a certificate of failure awaits us as a result of failed fiscal strategy in the MTEF. Besides, it is no mark of responsible fiscal strategy, if the fundamental assumptions underlying the 2014/16 expenditure plan are still yet to be resolved between the Executive and Legislature by November ending 2013, as ultimate Presidential assent may not be realistically expected until beginning second quarter 2014, with disastrous implications for successful budget implementation.

Balance budget as the responsible platform for MTEF he Debt Management Office recently indicated on its website that Nigeria’s total debt is currently about N7.93tn ($50.92bn); domestic debt accounts for almost $44bn, while external debt just falls short of US$7bn. Thus, our consolidated national debt may currently exceed N13tn (i.e. about $80bn), if AMCON’s proxy debt of about N5.7tn is also captured.

Paradoxically, however, the current stupendous over twofold increase in the national debt level, since the 2006 payment of $12bn for debt exit is often mischievously favourably reported by our Economic Management Team as still well below the ceiling of 40 per cent stipulated in the 2007 fiscal responsibility Act by about 5 per cent.

In the light of the preceding choking debt scenario, discussions on the 2014-2016 expenditure framework must recognize the oppressive burden of the double-digit interest rate on these huge debts, in spite of their risk-free sovereign nature. The subtle official propaganda to encourage a massive shift in favour of much cheaper external debt should also be recognized as an attempt to, once again, mortgage the interest of future generations to modern day neocolonialists. A more patriotic and progressive strategy would be to adopt a plausible monetary strategy that can bring down domestic cost of borrowing to the benign level of external loans.

Consequently, a responsible government should keep a lid on, and prevent even a one-

kobo increase in the current oppressive debt level, while the medium term plan must also accommodate a much more realistic framework for benignly managing the current debt burden.

Regrettably, the recent feeble consolidation of a N100bn annual sinking fund for debt repayment certainly does not provide any realistic assurance of capacity to service and repay our debts of about N13tn when due.

A realistic and progressive fiscal strategy that recognizes the unduly heavy burden of the current debt crisis must, therefore, necessarily be predicated on the platform of balanced annual budgets within the lifespan of government’s Medium Term Expenditure Framework (MTEF), which must be squarely founded on realistic revenue projections, so that there will be no need for additional borrowing, which will increase the already obnoxious debt level; in short, there must be no provision for deficit financing.

Furthermore, in the light of the significance of crude oil revenue, the price and output benchmarks must be realistically projected; for example, it should not be set below $80, as in recent years, when in actual fact, prices constantly remained above 25 per cent of benchmark at $100/ barrel, while cumulatively, over the same period, output may have fallen just below an average of 10 per cent.

Inexplicably, however, in spite of the expected revenue surpluses, which actually funded the Executive’s

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contrived designated Excess Crude Account, government still resorted to borrowing over 10 per cent of its annual budget of almost N5tn at oppressive rates, just to fund what some critics have described as ghost deficits.

In addition, a plausible MTEF must totally eliminate fuel subsidy as a component of expenditure, and must indeed, also consider a realistic arrangement to actually earn a minimum of 10 per cent sales tax from each litre of fuel sold in Nigeria, as is the case in other successful oil resource endowed nations like the UK

cost of funds to support real sector growth, we must adopt best practice of such successful economies, and therefore ensure that Central Bank’s Monetary Police Rate (which governs commercial lending rates) does not also exceed 2 per cent of LIBOR (the international benchmark for cost of funds). .

The other critical factor for consideration in a viable MTEF is the applicable benchmark exchange rate; for example, since 80 per cent of current revenue comes from crude oil dollar revenue, the naira amount available for spending, therefore, will

However, it will be selfdefeatist to attempt to increase revenue by continuous reduction in the naira exchange rate, as this would only instigate and sustain an oppressive inflationary spiral.

and US. It would equally be inapplicable to expect the desired positive outcome from an MTEF that does not recognize the catalyst functions of monetary variables, particularly, inflation and interest rates!

Indeed, except in recent months, the annual year-onyear inflation rate has consistently hovered around 10 per cent.

Consequently, a responsible and sustainably progressive MTEF must be underpinned by a benign inflation rate below 3 per cent, as in successful economies everywhere. Similarly, in order to ensure reasonable

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significantly be influenced by the applicable dollar exchange rate, since the dollars are unconstitutionally substituted with naira allocations by the CBN. However, it will be self-defeatist to attempt to increase revenue by continuous reduction in the naira exchange rate, as this would only instigate and sustain an oppressive inflationary spiral.

Furthermore, apart from its adverse inflationary impact, if, for example, the naira depreciates from N160 to N320=$1, fuel subsidy payments will correspondingly double, to over N4tn annually, with grievous impact on revenue provisions for social

Business & Economy Computer Warehouse Plans Nigeria Fundraising by 2015

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omputer Warehouse Group Plc (CWG), a Nigerian technology company, will seek to raise capital on the country’s stock exchange within 18 months after listing existing stock last week. CWG needs extra funding to refocus the business toward cloud computing from hardware and software, Chief Executive Officer Austin Okere, 49, said in an interview with Bloomberg at the company’s head office in Lagos.

CWG’s goal is to become the biggest cloud-computing provider in Africa by 2015, he said. “In twelve to eighteen months time, we will C M Y K

approach the market again,” said Okere. “By that time, we would have crystallized our transformation process.”

The Nigerian Stock Exchange, Africa’s secondlargest bourse, is seeking a $1 trillion market capitalization by 2016 by encouraging more technology and telecommunications companies to go public. The exchange is working to make it easier for companies from those industries to list, according to Nigeria’s Information and Communication Technology Minister Omobola Johnson.

“Our role is to be a trailblazer; to go to the

exchange and show to people the value of going to the exchange,” Okere said. “I won’t be surprised if this now opens the path for many more IT companies to come and list.” CWG plans to sell shares on the U.S. technologydominated exchange Nasdaq in the longer term, he said.

Acquisition Plans CWG’s shares have gained 4.5 percent since they were listed on the Nigerian Stock Exchange on Nov. 15, compared with a 3.2 percent gain on the all-share index over the same period.

CWG has a target to double profit in 2013 on sales of

Okere. The company is considering at least one acquisition, he said.

$132.2 million, according to

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