Nigeria lags in global outsourcing industry by Vanguard Media Limited

JULY 13, 2015

PRESENTATION - From left, Executive Director, Zenith Bank Plc, Mr. Ebenezer Onyeagwu; MD/CEO, Zenith Bank, Mr. Peter Amangbo; Deputy British High Commissioner, Mr. Ray Kyles and; Executive Director, Zenith Bank, Mr. Sola Oladipo, at the formal presentation of ISO Awards to the bank by the British Standards Institution in Lagos.

Nigeria lags in global outsourcing industry •Contributes just $2bn of $500bn BY PRINCEWILL EKWUJURU

igeria is lagging behind in the global outsourcing industry, contributing only $2 billion out of the $500 billion the industry generates worldwide annually. Investigation showed that globally, India is leading the pack followed by China, Malaysia, Thailand and Brazil without the presence of any African country. Other countries on the top 10 list C M Y K

include Indonesia, Bulgaria, Philippines, Chile and Japan. Some of the operators in the industry who spoke to Financial Vanguard, said despite the potential of outsourcing in terms of revenue generation and job creation, Nigeria is lagging behind among the comity of nation. The Association of Outsourcing Professionals of Nigeria, AOPN president, Dr. Austin Nweze, said that outsourcing holds the key to job creation. He noted that in 2020 it is expected that outsourcing will

create a minimum of 38 million jobs globally, while the online industry

Online outsourcing alone can create about 30 million jobs

will be moving from $15 billion to $25 billion, creating 30 million jobs. Nweze said also that of the $25 billion, Nigeria is expected to contribute at least 20 percent because of her increased number of youths, but regretted that Nigeria is lagging behind in this process. “We have $25 billion for online outsourcing alone, at the last count the industry as a whole was close to $500billion, presently US is outsourcing to India and China and has be able to recover from the economic downturn, and US is becoming an outsourcing hub,” Nweze stated. He said the job of the Association is advocacy - to sell the importance of outsourcing so that people would understand outsourcing more. “That is why we are advocating that government should understand outsourcing and accord it its place in the development and creation of jobs. Outsourcing can solve their problem in job creation,” he noted. According to him, “Online outsourcing alone can create about 30 million jobs. So what the Association is trying to do is to know the contribution of outsourcing specifically. So now we have to know the amount it is contributing to the economy. We are going to carry out a study.” Nweke who said that Nigeria is yet to come to terms with the reality of outsourcing, noted that Nigeria is still playing in the peripheral of the outsourcing business. “Here (Nigeria) we started from the supply side, we have not started the domestic demand side, we are servicing the outsiders, the thing is that Nigerian companies have not be able to embrace outsourcing because they don’t know the value. “If they know the value of the thing you want, you have to invest and protect that thing. So we are saying that outsourcing is the key to economic growth, it is the key to job creation, it is the key to creating wealth, for individuals and for the nation.” “And that is why we are saying if you understand the value of

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18 — Vanguard, MONDAY, JULY 13, 2015

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Vocation & TTec ec hnical echnical Education - K ey tto o Ke improving Nigeria's de ar devvelopment (P (Par artt 1)

PRESENTATION: From left, Executive Director, Finance and Strategy, Sterling Bank Plc, Mr. Abubakar Suleiman; Lead Consultant, Spreadout Media Nigeria Limited, Mr. Nwagwu Churchill; Executive Director, Corporate & Institutional Banking, Sterling Bank Plc, Mr. Kayode Lawal and Managing Director/CEO, Minds Share Media Nigeria, Mr. Chudi Obiora, at the presentation of the Best Poster Award in the financial services sector by the representatives of Outdoor Advertising Association of Nigeria (OAAN) to the Bank in Lagos…

Nigeria lags in global outsourcing industry Continued from Page 17 outsourcing, then you will invest in it. So we chose that theme. We want to realize the value, which country in the world, is either you are in the demand side of outsourcing or your are in the supply side, so both ways we are creating, the demand side is benefiting from the supply side, because the demand side the economics have moved, US economy for example, 70 to 80 percent service, so some other countries too that their economy have not really developed.” On the other hand, Peter Jack, Director General,/ CEO, National Information Technology Development Agency, NITDA who was represented by Dr.Sunday Folayan, a member of NITDA governing board was of the view that outsourcing is becoming a new thing in the Nigerian economy, “because talking about employment opportunity we believe that it is going to create a lot of opportunity for employment, that is the believe.” Describing the difference between casualisation and outsourcing, Jack said outsourcing is a function instead of setting up a means of doing it, you get someone else to do it. For example, he explained; you want to make a car, car would have tyres, seats and so on, you can get a company that makes tyres to make your car tyres, get C M Y K

another company that make seats to make your seats, when those companies make those things they bring it to your factory, may be you make the engine, you combine them together, then you make a car, so we say you have outsourced the manufacturing of your tyre to another company, that is outsourcing. "You will notice a trend in banks now. When you go to banks, some banks no longer have their staff as tellers or cashiers, they outsource job of tellers or cashiers to some other companies, some even outsource security to another company, that is outsourcing, so the moment you have a security company that handles security within your organisation, you have outsourced security to that company. “Now this is where it gets interesting, you cannot and

Outsourcing is already growing in the sense that people build subject areas that they are very competent in

it is not elegant to already have staff to carryout functions and you wake-up to say you want to outsource that company and you don’t have determinate thing to do with those staff, what will be right is to find a way to disengage them properly and compensate them properly, but not to say we no longer want to treat you like our staff, we now want to threat you as casual labourers. People who are already staff. That is casualisation and it is not in the spirit of outsourcing. So where the people already do it, outsourcing will strive, but if you are trying to force existing resources who are doing things in outsourced model, is a recipe for disaster. I think ultimately Nigerians will become more aware of the practice, like everything will strive for a balance, make sure things are done decently.” He went on to say that this will now bring value to the Nigerian economy if we start outsourcing most of our jobs. "Outsourcing is already growing in the sense that people build subject areas that they are very competent in, and you will find out that others who want to do things would yield to them. “If you want to make computers, for example, you don’t start by manufacturing mother boards, you go to China or

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echnical education is a planned programme of courses and learning experiences that begins with exploration of career options, supports basic academic and life skills, and enables achievement of high academic standards, leadership, preparation for industry-defined work, and advanced and continuing education. Vocational education and training prepares learners for careers that are based in manual or practical activities, traditionally non-academic and totally related to a specific trade, occupation or vocation. In other words, it is an “education designed to develop occupational skills.” Vocational and technical education gives individuals the skills to “live, learn and work as a productive citizen in a global society.” Technical and vocational education has been an integral part of national development strategies in many societies because of its impact on productivity and economic development. Despite its contributions the leaders of Nigeria have not given this aspect of education the attention it deserves, and this is one of the reasons for the nation’s underdevelopment. This article focuses on the dearth of skilled technical and vocational manpower in Nigeria and argues that technical and vocational education holds the key to national development. Every facet of the economy has been affected by lack of skilled technicians. The financial sector lacks technicians to regulate the banks and to develop financial software to properly tackle the rising fraudulent activities in the banking sector. Without security, development is impossible in a society; no nation can sustain its democracy if the citizens lack confidence in the police. The police violate the citizens’ human and civil rights and lack forensic laboratory and fingerprint

technicians to conduct criminal investigations. And due to poor training, military officers are known to beat up the citizens who challenge their powers and go scot free for their inhumane actions. The danger posed by environmental pollution and fake drugs is alarming. The less educated in the society lack the skill to manage AIDS, cancer and diabetes among other serious health problems. One wonders what the nation’s health minister and the 36 state health commissioners are doing to tackle these issues. Every good citizen is aware that the neglect of technical and vocational education is socially and economically injurious, because it is robbing the nation of the contributions the graduates would make on national development. For that Nigeria is today wearing the toga of a poor state. Although technical and vocational education seem deficient in ‘citizenship or leadership training’ (Friedman 1982). It provides students with “life skills to become productive entrepreneurs as it engenders creative and innovative ideas, enlarge the economic pie, and increase personal freedom. Most of the so-called “expatriate engineers” who are being paid millions of dollars to build Nigeria’s roads and bridges are graduates of technical and vocational colleges. Yet the leaders do not take technical institutions seriously. Nigeria’s current preoccupation with university education reduces economic opportunities of those who are more oriented toward work than academic. Not everyone needs a university education. Awarding licenses to greedy organizations and individuals to establish private universities that are not even as equipped as some of the technical and vocational schools in the United States and other advanced nations cannot develop the society.

Vanguard, MONDAY, JULY 13, 2015 — 19

he Central Bank of Nigeria (CBN) recently excluded some goods being imported into the country from the list of items valid for foreign exchange in the Nigerian foreign exchange markets. The implication of this is that those who import these items can no longer buy foreign currency from banks, bureaux de change or any other official source to pay overseas suppliers of such goods. Instead, they have to source their foreign exchange from outside the banks and bureaux de change. These items are not banned but importers cannot access There are a lot of bamboo are wasted, and farmers are foreign exchange from stick all over Nigeria that can falling deeper into poverty Nigerian banks. be used to produce tookpick if while policy makers export The CBN came to the it is so important to Nigerians. their jobs and income to ricedecision as a result of the The sad thing is that instead producing countries? Besides, continued pressure on the of Nigerians to stand solidly these rice importers are tax Naira exchange rate. The behind the monetary authority evaders who use their decision of the apex bank has to call the bluff of western connection with politicians to not gone down well with many interests against Nigeria, shortchange the nation through importers and their foreign many are supporting and waivers and concessions. interests that want the Naira sponsoring publications Nigeria must do everything it to further lose value. Some of against the restriction of can to protect the jobs and the items in question are access to foreign exchange. incomes of local farmers and products that abound in The pressure on the Naira at boost local production using Nigeria. Nigerians are able the foreign exchange market some of the same principles to produce enough of these might continue to mount and Western economies use to items to service the economy. see further depreciation in justify the protection of their Even those not being value of the Naira if stern farmers through huge produced locally are not measures are not applied. The subsidies. essential products that the naira is already exchanging at Nigerians must know that the nation cannot do without. N350 to the pound and N230 country cannot attain its full The restriction has started to the dollar. Unfortunately, potentials by importing yielding results as Nigeria’s western economists want anything and everything. Since foreign exchange reserves Nigeria to further devalue the the introduction of Structural has risen sharply to $31.89 naira knowing too well that Adjustment Programme by the billion from its previous the country is importbalance of $29.1 billion as at dependent and devaluation last week. will further impoverish the It is common knowledge citizenry. that Nigerian farmers are At the current exchange rate, producing substantial paddy no local industry will survive rice but the nation continued and the economy will worsen to spend billions of dollars because Nigerian economy is every year importing rice. It not export driven. Devaluation is also common knowledge of a currency is profitable to that palm kernel/palm oil only an export-driven abound in Nigeria, yet, economy. The Nigerian Nigerians are importing economy has to be made to be same. The most ridiculous of productive and a hard these imported items are decision has to be taken to Indian incense, wood particle change the economy ’s boards and panels, plywood structure, resuscitate local boards and panels, wooden manufacturing and expand doors, toothpicks, tomatoes/ job creation for Nigerians. tomato paste. Every year, Why should Nigeria keep tonnes of tomatoes grown in allocating scarce foreign the north go waste because exchange to rice importers of lack of local patronage. when huge amounts of paddy Besides, it is a thing of shame rice of comparable quality that a Nigerian businessman produced by poor will go to China and all he hardworking local farmers can import is tookpick. across the rice belts of Nigeria

Nigerians: Time now to decide what not to import

The pressure on the Naira at the foreign exchange market might continue to mount and see further depreciation in value of the naira if stern measures are not applied

Babangida military junta, the devaluation of the Naira has been pursued with the hope that the economy will be better off but that has not been the case. The introduction of SAP saw the massive devaluation of the local currency and the enthronement of a free float for the Naira. At inception of the famous deregulation of the foreign exchange market, the CBN introduced three-tier foreign exchange markets. There was the first tier market which was the official rate at which the government bought foreign exchange from the CBN. There was the second tier market where the private sector and other individuals were sourcing their foreign exchange requirement from. The third was the autonomous foreign exchange market where exporters put the proceeds of their exports and sell same at their own determined rate. However, there existed and still exists a parallel market where un-licensed individuals hawk foreign exchange along major streets in Nigeria and even in mosques. The rates that ruled these markets were never the same. In fact, there have been multiple exchange rates in the economy since deregulation. This gave room for foreign exchange speculations that resulted in excess demand for foreign exchange. Nigerians, banks and others have been hedging against depreciation ever since. Today, the demand is high because those who have the resources are buying dollars for keeps in anticipation of possible

devaluation of the Naira as a result of declining oil prices. In fact, the Nigerian economy has been dollarized with local prices quoted in dollars. In economics, there is what is regarded as shadow price of a given commodity. The shadow price usually is the price that is envisaged if the product were allowed to find its true value in a free market setting. As a result of the shadow price of the naira, the international business community always agitate that the currency was over-valued and that the true exchange rate of the naira is the parallel market rate. Following this argument, Nigeria has continued to adjust the currency from N2.02 to the dollar in 1986 to N230 today. In 1987, the exchange rate was N4.02 to the dollar and in 1988, it had moved along the parallel market rate of N4.54. The economy was still on its knees as the exchange rate moved further in 1989 to N7.39 and in 1993, the two markets were merged at N22.05 to the dollar. By the turn of the century in 2000, the exchange rate was N102.10 to the dollar. By 2002, the exchange rate of the Naira to the dollar was N121 and in 2004, the rate had peaked at N133. Today, the Naira is exchanging in the inter-bank market at N230 to the dollar. The handling of the exchange rate in the past had been questionable. Nigerians must come to grips with reality and stop frivolous importation. Nigeria cannot continue to devalue its currency to satisfy few selfish interests.

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Nigeria lags in global outsourcing industry Continued from Page 18 India for companies that are already manufacturing boards, even those companies who make those things, do not make everything. People that make screens specialise in screens, those that make keyboard specialise in keyboard. So you get from all the sources and assemble. So as someone

who wants to do something, you outsource all the parts to other people to do. On whether if it’s being practiced in Nigeria, he was of the affirmative; “It’s already being practiced in Nigeria. We don’t just get to recognise it as outsourcing. I mean if you want to build a house today, you get a builder who builds it. You get a carpenter who does the furnishing; you get a draper

to do your curtain, which is outsourcing. It’s not more complex than that. It is already something we are doing, we just need to put in more structure, and put it in a more definite form.” On whether there are policies to this effect, he quipped; “Of course, there are policies, “NITDA is working very hard to show the roadmap and working with associations like the AOPN is

a right logical step to let the policies work for the people.” Accordingly, in another development, global Information Technology, IT outsourcing (ITO) services in 2012 reached $251.7 billion, a 2.1 percent increase from 2011 spending of $246.6 billion. Also according to the latest outlook by Gartner Inc. European sovereign debt crisis and economic volatility

in the US are the major reasons Year on Year growth fell to 2 percent from 8 percent in 2011. Businesses in Europe and US then slashed their IT spends and budgets and most of the Indian outsourcing vendors hinted that clients spending and budgets will either remain flat or will be cut down in 2013.

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20— Vanguard, MONDAY, JULY 13, 2015

Business & Economy

6 ships with petrol, foods arrive Lagos

ix ships laden with petrol, diesel and bulk rice are waiting to berth in Apapa and Tin-Can Island ports in Lagos. The Nigerian Ports Authority (NPA) disclosed this in its daily publication- Shipping Position - made available to newsmen on Thursday in Lagos. The document reported that 29 other ships were expected at the ports from July 9 to July 20. The expected ships are laden with base oil, general cargo, buck wheat, frozen fish, bulk salt, crude palm olein, bulk sugar, container and crude palm oil. The document indicated that other ships were coming in with petrol, kerosene, diesel, bulk sugar and bulk malt. NPA also reported that 22 ships were already in the ports discharging buck wheat, base oil, bulk soya, general cargo, bulk rice, fresh fish, containers, petrol, diesel, and gypsum.

Electricity in rural areas'll enhance agric growth, says NERC

hairman, Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi said on Thursday that availability electricity in the rural areas would enhance the growth of the agriculture sector. Amadi said in Abuja that with rural electrification, modular powers could be created in the rural areas to enable farmers to preserve their surplus farm produce. He said crops such as maize could be stored in local silos powered by light for longer periods. He said, “With rural electrification, you can create modular powers, small powers not to the grid, whether using sunlight, or other renewables to create small light that can power those communities before the national grid comes to them,“ he said. According to him, it will not be realistic for people in the rural areas to wait for the national grid to get to all parts of the country before they can engage in agric business.

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Nigerians in Diaspora remit N10.35trn in 4 years

he Nigerians in D i a s p o r a organisation (NIDO) said its members remitted about $63.17 billion (N10.35 trillion) into the country between 2011 and June 2014. Dr George Manuwuike, the Chairman Board of Trustees of NIDO, stated this in Abuja during a news conference on the Diaspora Day 2015 scheduled to hold from July

23 to July 27 in Abuja. Manuwuike said that the Diaspora remittance was second only to oil and gas revenue as the highest foreign exchange injection to the Nigerian economy. “As the umbrella organisation of Diaspora Nigerians, we are proud to associate with the phenomenal amount that Nigerians living abroad have been bringing to the national

economy. Recently, the World Bank reported that between 2011 to June 2014, Nigerians in the Diaspora had remitted about 63.17 billion dollars (N10.35 trillion) into the country. “In terms of remittance from her citizens living abroad, Nigeria was ranked five globally next to China, India, Philippines and Mexico,” he said. The chairman said that

BRIEFING: From Left: Dr Osaren Emokpae, Chairman, Havilah Open Door Limited, Mr Amuzie Akpaka, Deputy Vice Chairman, Havilah Open Door Limited, and Mr Friday Ngbodi, Group Deputy Managinig Director, Havilah Open Door Limited, During the Press Briefing to Mark 15th Year Anniverssary Celebration of Havilah Open Door Limited, A Marketing Communications and Industrial Security, in Lagos. Photo by: Kehinde Gbadamosi

NIDO, since its inception in 2000 had served as forum for Nigerian Diaspora networking and advocacy. He said that it had organised tens of trade and investment conferences that brought together Nigerians and foreign investors for dialogue opportunities for technological, educational, industrial and other forms of investment in Nigeria and others. He said that NIDO intended to reverse and convert the “brain-drain” the country had suffered for so long into “‘brain-gain”. “NIDO plans to ramp up its engagement in Nigeria to ensure that its mission and goals are achieved, and impact of its actions are felt by both government and the Nigerian masses. It is for this and other purposes that a structure of NIDO has recently been registered here in Abuja as a Non Governmental Organisation. We believed that this action will instil confidence in NIDO as a partner with all our citizens and government at all levels,” he said. He said that the organisation wanted to use this year Diaspora Day to raise funds for a number of projects that were proposed for the benefit of Nigerian people.

OPS wants takeoff of SMEs Development Bank BY FRANKLIN ALLI

anufacturers Association of Nigeria and the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture arms of the Organised Private Sector, OPS, have called for the take off of the SMEs Development Bank of Nigeria (DBN) without further delay. Vanguard learned that since the Bank with $1 billion capital base was inaugurated last year by the Federal Government to cater for the credit needs of manufacturers in the micro, Small and Medium Enterprises (MSMEs) sectors of the economy, it has neither office nor Board of directors. Dr. Frank Jacobs, President, MAN, said it was high time for government to revisit it and make it to function like the Bank of Agriculture, BOA, and Bank of Industry, BOI.

Chief Bassey Edem, National President, NACCIMA also said: “The take-off should not be delay considering the importance of the bank. According to him, the establishment of the development bank for SMEs is long overdue and a step in right direction as long as

The bank will assist small scale business owners to access funds for a longer tenure of between five to seven years.

government ensures that the set objectives are achieved. The NACCIMA boss said that the capital base for the bank should be measurable to global standard of such a bank and must be able to give facilities to SMEs at a single digit interest rate for it to have the desired impact on both the citizenry and the national economy. “The bank when operational will not duplicate the role of BoI, rather it is complementing it, enhancing the economic agenda of government and making access to funds by small entrepreneurs less stressful,” he stated. Recall that the former Minister of Finance and Coordinating Minister of the Economy, Dr. Ngozi OkonjoIweala, had during the launch of the Development Bank of Nigeria, said when it is on ground, the bank will help Small and Medium Enterprises (SMEs) to access

funding for a longer period of time, something they have never being able to do. “The bank will assist small scale business owners to access funds for a longer tenure of between five to seven years. She noted that many people with business ideas could not access funds and in cases where they are fortunate to access funds they will be asked to start paying back after a year knowing well that businesses take between two to three years to stabilize, lamenting that many business owners have not been able to march the timing of the loan they get with the timing of their investments,” she stated. Reacting to the development, Rasheed Olaoluwa, Managing Director BOI, said: “DBN is welcome; it has been launched. I don’t think they have any office yet and I am not aware of any MD appointment. Again, we keep our fingers crossed.”

Vanguard, MONDAY, JULY 13, 2015 — 21

Business & Economy

MEETING - From Left: Dr Christopher Kolade,Chairman of Occasion, Dr Chris Ogbechie,Guest Speaker,Mr Victor Odiase, Disscusant and Dr Nosike Agokei, Past President ICSAN at the Institute of Chartered Secretary and Administrator (ICSAN) roundtable meeting on corporate governance at the Civic Centre, Victoria Island Lagos. Photo by: Biodun Ogunleye

Capital market appoints dematerialisation project manager

he capital market operators h a v e appointed a renowned Nigerian consulting firm to guide the implementation of the much-awaited dematerialisation of the nation’s portfolio investments. Capital market sources said) in Lagos that the firm would act as project manager for the full dematerialisation of the market. Dematerialisation is the process of replacing paper certificates with electronic records at the Central Securities Clearing System (CSCS). They said that the project manager would also guide the implementation of direct payment to clients and the mass trading system proposed by the market operators. “We, the stakeholders in the market, have come together to appoint a project manager that will guide and coordinate the implementation process of various initiatives in the market,” they said. The market operators said that the plan of the current management of the commission was to ensure implementation of the various initiatives of CMC in the past five years. According to one of the sources, the consulting firm would work closely with a technical committee appointed by the Securities and Exchange Commission (SEC) to ensure smooth transition. He said that the report of the demateralisation committee had been with SEC for five years. He stressed that the commission’s present

management remains committed to the market full implementation of the materialisation project. Mr Mounir Gwarzo, SEC Director-General, had at the first Capital Market

Committee (CMC) meeting in the year, pledged that the final blueprint of the dematerialisation document would be ready in July. He said that the commission would at the second quarter

CMC release the final blueprint of the dematerialisation for effective implementation. The directorgeneral said that the blueprint would address legacy issues that had affected dematerialisation exercise. “The CMC dematerialisation committee submitted extensive report, we are now talking of implementation and we have set up a technical committee to handle it,” Gwarzo said. He said that the report of the technical committee, comprising the Nigerian Stock Exchange, registrars, SEC and the Central Securities Clearing System (CSCS), would be out by the next CMC meeting. The acting director-general said that the major aim of the technical committee was to drive dematerialisation implementation. He said that the CMC was working to ensure that funds from transactions would be credited directly into investors’ accounts, rather than through the stockbrokers. “One area that we also think will encourage investors greatly is the area of direct payment where if a client gives his shares to be sold, the proceeds would be credited into his account directly,” he said.

Zenith Bank records another first with three BIS certifications By Babajide Komolafe

enith Bank has become the first company in Nigeria to achieve at once three certifications from British Standards Institution (BSI). Last week the bank achieved the BIS certifications for Information Security Management System ISO/IEC 27001:20013, IT Service Management System ISO/IEC 20000-1:2011 and Business Continuity Management System, ISO 22301:2012. In a ceremony in Lagos, the certificates were awarded to the Chairman of Zenith Bank, Mr. Jim Ovia and the CEO, Peter Amamgbo by British Standards Institution (BSI) from the Deputy British High Commissioner, Mr Mike Purves. A number of high ranking executives, officials and employees also attended the ceremony from Zenith Bank and Global Info Swift. Commenting on the occasion, Mr Jim Ovia, Chairman of Zenith Bank remarked: “Our commitment to these internationally accepted standards stems from a resolve to deepen customer experience through greater information security, an efficient IT management system and a robust business

continuity plan that emphasizes the protection of the customers and their investments in an increasingly unpredictable business environment. Certification to these three standards is strong proof of the bank’s commitment to implement policies and practices that meet globally recognized standards.” The Chief Executive officer, Mr Peter Amamgbo commented that “Zenith Bank is proud to have achieved this milestone, technology is at the core of our business strategy in order to meet the needs of our customers. For us, the customer is the reason we are in business, therefore it is essential that we deliver exceptional customer services. Certification to these standards will assist us in doing this. He said, “Today is a landmark occasion. Landmark, not just because Zenith Bank is being awarded, but today is actually a special journey for me. We are talking of a three in one award and this is the first time in the history of this country that any institution at all, whether financial

institution, manufacturing or service industry would be having these three certifications at the same time. “I want to say that the award itself comes with a lot of responsibilities. It challenges us further to ensure that we keep to the tenets of the awards and I want to assure the BSI and all those present here today that the management and board of Zenith Bank is absolutely committed to continue to support this initiative and we would continue to give our support to ensure that this bank gains other certifications. We should not rest on our oars. We would also ensure that the award and all what it stands for is engraved in our DNA." He further added that “becoming certified to these three standards provides evidence in our efforts to comply with local and international regulations relating to data protection, privacy and IT governance. "We hope through implementing ISO/IEC 27001, it will give greater confidence to our customers," he said.

Medview Airline begins flight operations into Maiduguri airport By Lawani Mikairu & Daniel Eteghe

EDVIEW Airline began flight operations into the Maiduguri airport last weekend following the opening of the airport to flight operations. Disclosing this development to newsmen, Managing Director of the airline, Alhaji Muneer Bankole said that the airline will commence four weekly flights beginning from Friday, Sunday, Monday and Wednesday. He said that commencing the flight will help reduce the long hours of stress on the road which the people of that region go through to get in and out of Maiduguri and further commended Governor Kashim Shettima of Borno State for calling on investors to return to the state as there was now relative peace in the region. “Our decision to commence flights to Maiduguri was informed by the need to link up the people of this region to other parts of the country,” Alhaji Bankole said. According to him, the four flights from Lagos to Maiduguri will be routed via Abuja. “With Maiduguri, Kano and Kaduna on its schedule, Medview Airline now flies to eight destinations, Lagos, Abuja, Port Harcourt, Yola and Enugu on domestic routes and Accra on the regional route. Abidjan, Cote de’ Voire and Conakry, Guinea will soon join the Medview network” he said. It will be recalled that Nigerian Civil Aviation Authority (NCAA), the Federal Airport Authority of Nigeria (FAAN) and Nigerian Airspace Management Agency (NAMA) have given a go ahead to Medview Airline to operate into Maiduguri airport, which has been closed to commercial flights due to activities of insurgents.

22 — Vanguard, MONDAY, JULY 13, 2015

Banking & Finance

FG vs Obasi: Hearing rescheduled to Sept 30

he arraignment of factional president of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chief Lawson Obasi and three others over alleged breaking and robbery was rescheduled to September 30th due to the absence of the judge. Obasi, who is accused alongside Ukadike Chinedu, Augustine Erhabor and Andrew Ashiga, who is said to be at large, could not take their plea as the judge Abba Bello Mohammed was said to be indisposed. The Director of Public Prosecutions (DPP), Mohammed Diri had in March filed the six-count charge before the FCT High Court, Jabi, Abuja. The accused IPMAN members were alleged to have on April 14, 2014 armed with dangerous weapons such as cutlasses, wood, iron rod, and knives violently entered the premises of IPMAN located at No 41 Gnassigbe Eyadema Street, Asokoro Abuja. They were further alleged to have attacked the

Associated Discount House migrates to Finacle 10 BY EMKA AGINAM

n a bid to improve efficiency and improve customer experience, Computer Warehouse Group (CWG ) has powered the successful migration of Associated Discount House banking services to Finacle 10 core banking application Finacle core banking solutions were designed to help financial institutions improve their business processes as well as defend them against systemic fraud. The solutions provide a comprehensive, integrated, yet modular and agile approach to core banking that addresses banks’ sophisticated needs in easyto -configure modules that solve their unique problems while providing highperformance infrastructure that scales with their needs.

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PRESENTATION - MD/CEO, NDIC Alh. Umaru Ibrahim (2nd Right) welcoming the World Bank team of Jan Philipp Nolte (3rd Left), John O'keete (4th Left) and Julian Casal (1st Right) to the NDIC Head Office, Abuja for a formal presentation of NDIC’s Target Fund Ratio Framework while the Corporation’s Director Research, Dr Ade Afolabi and Executive Director (Corporate Services), Mrs Omolola Abiola-Edewor watch.

ABCON laments over-regulation of bureaux de change •Calls for BDC directorate in CBN BY BABajide komolafe

ssociation of Bureaux De Change Operators of Nigeria (ABCON) has lamented the overregulation of bureaux de change. The Association, in a letter to the Governor, Central Bank of Nigeria (CBN), said, “We wish also to inform you of the increasing challenges arising from over regulation and complex d o c u m e n t a t i o n requirements that licensed BDC operators are facing in carrying out their daily legitimate operation. These also have had negative impact on their efforts toward compliance to statutory and regulatory requirements. Signed by the by the Acting President, Alhaji Aminu Gwadabe, the letter stated further, “The various departments of the CBN which includes TED, OFISD, FPRD, IT, BOD and the BOP among others are involved with BDC regulations, supervision, licensing, monitoring etc. This in our understanding constitutes multiple regulation of a unit of the financial sub-sector that is only involved as a small market player. “A BDC operator is expected to render daily, monthly, quarterly, half yearly and annual returns to these various

departments of the same corporate body, which could be very cumbersome, repetitive and time consuming for both the operator and the regulator. In addition to the above mentioned reports, the BDC is also under obligation to render same returns to the EFCC/NFIU, while at the same time reporting to other statutory government establishments as the FIRS

and CAC respectively.” The Association also complained about the high penalties imposed on BDCs for infractions, complex d o c u m e n t a t i o n requirements, low network on EFASS platform and limited scope of operation. Consequently the Association appealed to the CBN Governor for harmonization of all the various regulatory

department of the CBN and the NFIU. “We suggest a single BDC directorate at the CBN to be in charge of the BDC sub-sector in order to enhance efficiency, productivity and transparency. This would engender proactive involvement of both the regulators and the BDCs for the growth and dynamism of the sector”, it said. ABCON also called on the, “CBN to convene a stakeholders’ forum for the review of extant infractions so as to have a workable, harmless penalty regime acceptable to all. It also called for replacement of the present e-FASS platforms with a more convenient and office friendly platform that will allow the use of emails in the rendition of BDC returns to CBN. The Association also proposed the following that, “Other measures proposed by the Association The CBN to consider as alternative requirement other means of identification such as drivers licence, voters card, international passport etc; We urge the CBN to fulfill its promise of allowing the BDCs participation in the inward transfers like home remittances of Nigerians in Diaspora; “BDC denominated dollar cards and coupons. The CBN should consider the introduction of dollar denominated cards and coupons to BDCs for retailing to the public.

BVN Extension: CeBIH advocates prompt enrolment by customers

ommittee of E-Banking Industry Heads (CeBIH) has called on bank customers to take advantage of the deadline extension and promptly enroll for the Biometric Verification Number (BVN). CeBIH Chairman, Mr. Tunde Kuponiyi made this call while commenting on the extension of the deadline for enrolment for the BVN. The Central Bank of Nigeria (CBN) on June 30 th had announced a four month extension till October 31st 2015 for bank customers to enroll for the BVN. “We are calling on customers to visit their banks and promptly enroll for the BVN”, he said. Kuponiyi noted that the purpose of the extension is to allow customers enough time to enroll irrespective of where they are based. “The extension presents ample opportunity for bank customers to do their enrolment without the challenge of spending hours on queues as experienced few days to the end of the initial deadline”, he said. “The four months extension seems a long period, but customers should not delay or postpone their enrolment - it is better to do it now. Customers should not wait a few days to October 31 st to avoid last minute registration rush and avoid spending hours

in banking halls. They should also remember that they can enroll for their BVN from any branch of their bank, hence there is no need to wait till when you can visit the branch where the account is domiciled”, he said. Listing the benefits of the initiative, Kuponiyi noted that the BVN affords customers the opportunity to register their biometric data against their bank accounts to protect their funds against fraudulent and unauthorised access. “The BVN protects customer bank accounts from unauthorized access, as biometric information is not easily manipulated. It also increases the efficiency of the banking industry as it reduces incidence of fraudulent/duplicate bank accounts, and easily highlights blacklisted customers. Furthermore, full integration of BVN provides standardized efficiency of banking operation. This means that all banking operations will be verified using the same method, reducing cases of human error or inconsistency. In addition to these, the implementation of BVN means transaction authentication without the use of cards, but instead using only biometrics and a PIN”, he said.

Vanguard, MONDAY, JULY 13, 2015 — 23

Banking & Finance

Banks and Nigeria’s $14bn infrastructure challenge By Babajide Komolafe

mong other things, Nigeria’s economic development is confronted with the challenge of huge infrastructure deficit. According to the Africa Infrastructure Country Diagnostic (AICD) Report for 2011, the country requires sustained spending of $14.2 billion per annum over the next decade in order to address the infrastructure challenge. Furthermore, it is estimated that Nigeria needs N10.63 trillion ($67 billion) for road upgrades, bridge repairs, the energy sector, hospitals and schools. The above scenario, as experts have surmised, clearly shows that as a result of the huge funding requirement for present and future infrastructural development and its attendant impact on survival and growth of businesses in Nigeria, traditional funding methods can no longer suffice as the traditional fund providers, different levels of government, do not have such resources at their disposal. Consequently, Private Finance Initiatives (PFI) and Public Private Partnerships (PPP) are being adopted to meet the funding challenge. In Nigeria, PFI and PPP are relatively new models for public project finance and commercial banks remain the formal source of finance for driving PFI among enterprises. Of course, banks have three social and economic functions: to collect and secure savings and other deposits; to finance the economy by handing out credits; and to facilitate payments and to transfer funds. Their role is to reduce the gap between supply (the money deposited and potentially available) and demand (the money needed for investment) that exists between idle money and productive investment. In recent time, an increasing number of socioeconomic projects bothering on infrastructural and natural resources rejuvenation and business growth and expansion initiatives have been developed and financed through equity and medium

Ifie Sekibo, MD/CEO Heritage Bank to long term loan packages by commercial banks. In the last half decade, leading banks like First Bank, GTBank and Zenith have continued to make strong mark the area of project financing. However, a quick look at the country ’s project financing market shows commendable influence being exerted by a few new players, who ordinarily, would have been considered as greenhorns without the required skill, stamina and wizardry to play in the intricate game of project financing. Leading in this wise is Heritage Bank, which entered the market about Twenty Four months ago. Since its foray into the Nigerian, financial sector, Heritage Bank has played a pivotal and leading role in the equity and project financing market, arranging in excess of $2 billion of debt facilities either as lead or sole financier or financial adviser. The field of engagement has equally been diversified; covering economic sectors such as MSME, Entertainment & Arts, Education, Oil & Gas, Aviation & Haulage and Public Sector. For instance, the bank has midwived over $100 Million in funding for a variety of transactions in the film and entertainment industry from 2013 to date. These include Bloomberg TV Africa (the Pan African TV by Bloomberg LLP), Free-to-Air TV Broadcast Rights in

Nigeria for the 2014 FIFA World Cup, HIP TV (a Pan African TV Music Channel broadcast on satellite TV which was funded from scratch) and a variety of other investments spanning content, platforms and production. Also, the innovative multibillion naira MSME Investment Protection Fund (InPF), which is a noncollateralized funding option with embedded insurance to address the default risk inherent in the SME Finance scheme, remains a strong differentiating indicator of the Heritage Bank approach to SME funding in the country. However, the recent

An increasing number of socioeconomic projects bothering on infrastructural and natural resources rejuvenation and business growth and expansion initiatives have been developed and financed through equity and medium to long term loan packages by commercial banks

successful finance of Forte Oil Plc’s acquisition of 100 brand new Mercedes Benz product delivery trucks for haulage, logistics and product transportation across the Country as well as the Project Finance Facility to PIPP LVI GENCO to set up a 6.5MegaWatts Captive Power Generating Plant and a 25km Distribution Network to power Public Utilities in Lekki, V/I and Ikoyi represent giant strides by the relatively young Heritage Bank which had already financed similar and bigger projects in Port Harcourt and Abuja in deals worth several billions of naira in the last twelve months. Speaking on the significance of Heritage Bank’s project finance initiatives, Executive Director, Manila Banking, Niyi Adeseun noted that, “For us at Heritage Bank, our core business philosophy as a timeless wealth partner to our customers is captured in our mission to create, transfer and preserve wealth. Our support efforts through project financing in the various sectors of the economy is one of the platforms that underscore our resolve and readiness to make a mark in the financial sector as a major pivot of s o c i o - e c o n o m i c transformation of our country” Continuing, he explained, “For instance, in the Oil and Gas industry, our interventions span the downstream sector areas of product importation, supply, engineering and many more while we are also gradually getting really involved in the upstream as well. We have financed a few of such projects in Port Harcourt and we have a couple of them also in Abuja”. In a testimonial, Group Chief Executive Officer, Forte Oil Plc, Akin Akinfemiwa lauded Heritage Bank on its project financing portfolio. According to him, “We appreciate the strategic role of Heritage Bank in financing the acquisition of our latest 100 world-class product delivery trucks which, to us, is a very strategic investment that will substantially increase our capacity to grow our revenue and profitability and ultimately maximize value for our stakeholders”. It is indeed very clear that due to Nigeria’s rich entrepreneurial culture, its dynamic economic landscape is characterized by a high level of local and international trade which has continued to witness growth over the years.

Sterling Bank finances N50m tractors for TOHFAN

etermined to sustain its stronghold in the agriculture finance space which earned it two awards; the Best Bank in Commercial Agriculture Credit Scheme (CACS) and “Agric Bank of the Year 2014 in Nigeria” in the last one year, Sterling Bank Plc has financed the purchase of tractors for members of the Tractors Owners and Hiring Facilities Association of Nigeria (TOHFAN). The cost of the tractors is put at N50 million. Sterling Bank finances the purchase / acquisition of tractors from reputable tractor manufacturers like Massey Ferguson, Mahindra, New Holland, John Deere and Tak tractors who will also provide basic training on utilisation and offer after sales maintenance services. The tractors which have been distributed to members of the Association following the first disbursement would help in the adoption of mechanized agriculture, leading to additional hectare coverage, higher yields and enhance food security in the country. The Bank in a statement noted that its involvement in the agricultural sector was based on the need to reposition the sector as the main stay of the economy especially so, with the dwindling revenue from oil. The Bank explained further: “Sterling Bank Plc has continually restated its commitment to the strategic growth of the agricultural sector by providing adequate funding in alignment with the ongoing reforms in the sector aimed at repositioning it as an attractive business proposition, an input provider for the manufacturing sector and a key foreign exchange earner. “The best bank in Agric Award was conferred on the Bank in recognition of its critical role in the dispensing of financial services to actors in the Nigerian agricultural value chain. This we have demonstrated again with the financing of the tractors which will add value to the sector ” The National Treasurer of the Association, Abdullahi Lawal, who also confirmed the development commended the Bank for supporting the Association and said that it would go a long way in improving the output of the beneficiaries.

24 — Vanguard, MONDAY, JULY 13, 2015

Corporate Finance

RECAPITALISATION: UK regulator says capital levels at insurers “appropriate”

ritain will not use new EU insurance rules to force the sector to top up on capital as the system already has an appropriate amount, the country’s top insurance regulator has said. The new EU capital rules for insurers, known as Solvency II, take effect in January. “I have heard from some a concern that we will use Solvency II to increase levels of capitalisation across the sector, or that we are seeking to load the sector with more capital now so that it is baked into the new regime once operational,” said Sam Woods, executive director of insurance supervision at the Bank of England. “Let me state very simply: there is no such plan within the Bank of England. The reason for this is also simple: we think that our current regime secures an appropriate level of capitalisation for the insurance sector and puts us in a good position to make the shift to Solvency II,” he told a conference.

REIT rate hike fallout fears may be overdone

fter a meteoric rise in 2014, shares in many real estate investment trusts (REITs) have crashed back to earth this year as the market braces for a U.S. interest rate hike, but the reversal in sentiment may have gone too far. REIT shares peaked at the end of January, and have fallen 12.3 percent since on fears that the Federal Reserve’s first interest rate hike in years could hurt the sector. Rising rates increase the costs for REITs that have to borrow heavily for new investments. Furthermore, yield-hungry investors who buy REITs for their high dividends during times of low bond yields often abandon them once bond yields start to rise. But not all REITs suffer equally when rates fall, and a broad selloff may be a “kneejerk reaction,” said Jim Sullivan, managing director at Green Street Advisors, a Newport Beach, California research firm specializing in REITs.

We're working with regulators, stakeholders for smooth process — ABE By PETETR EGWUATU

r. Oluwaseyi E. Abe, is the a c t i n g President of Chartered Institute of Stockbrokers, CIS. In this interview, he spoke on the activities of the institute as well as happenings in the capital market, among other things. Excerpts: The CIS has been playing a pivotal role in the engagement with the capital market regulators on the issue of recapitalisation of market operators. SEC has stated that September 2015 deadline remains sacrosanct? What is your view? We are really working in collaboration with regulators and other stakeholders to ensure that the exercise is smooth. We succeeded in securing an extension of the recapitalization deadline. We are still at the fore front of engagements with the regulators to ensure that the interest of operators is protected. It will be preemptive to go beyond this information for now. But we are getting on well with the regulators. There is the problem of negative reaction to the capital market as a fall out 2008 meltdown. What strategy is being put in place by the market operators to woo back investors into the market? It is a multi-faceted approach: first, the investors must be educated and informed that our market has recovered, and that current price swings are normal. Second, the Nigerian Stock Exchange, NSE must fashion out a policy that encourages the licensing of more stockbroking firms to operate in the remote states and towns. Third, corporate governance at all levels must be significantly enhanced. Fourth, the government also has a role to play in providing liquidity to stabilise the market. Finally, efforts should be stepped up to revitalise the primary market and promote new listings of local and foreign firms. What is the institute’s major request from the new administration of President Mohammed Buhari? Some of the issues we would want the new administration to give priority attention to include: Financing of major

•Oluwaseyi E.Abe government projects, such as instance infrastructure, through the capital market, thereby moving from a largely bank-based to a capital market - based financing model; Supporting capacity building initiatives by funding appropriate professional groups such as CIS to carry out the task; Provision of a

The Nigerian Stock Exchange, NSE must fashion out a policy that encourages the licensing of more stockbroking firms to operate in the remote states and towns

buffer stabilization funding arrangement for the capital market. This can be done through AMCON, for instance; Putting in place policies aimed at channeling more savings to investment in the capital market. For instance the federal government should encourage Pension Funds, through PENCOM, to invest more in the stock market; Provision of appropriate incentives and legislation for companies to list; especially those in the major sectors of the economy; Consideration of the potential impact on the capital market whenever economic policies are formulated. Any other comment for the investing public? The public should be assured that the Nigerian capital market has fully recovered and it’s on the path of surpassing the previous high points. Domestic investors should therefore take advantage of emerging opportunities. However, investors need quality advice from qualified professionals. They must patronize only licensed stockbrokers that are eligible to trade. Investors must avoid patronizing quacks and when they are in doubt of the status of a stockbroking firm or a stockbroker, they can contact the institute for assistance. For the teeming young Nigerians who wish to become finance and investment professionals, the time to take action is now.

CIS certifications will open doors of opportunity to you, as they are some of the most attractive in the country, especially now that activities in the capital market are booming once more. You presided over the Annual General Meeting (AGM) of the Chartered Institute of Stockbrokers (CIS) on April 30, 2015. What were the remote and immediate circumstances that led to the development? The remote circumstances, if you want it that way was that our President, Mr. Albert Okumagba stepped aside due to issues relating to the oversight function of SEC as the apex regulator in the Capital Market on BGL, where he was Group MD/ CEO. In view of this development, the Council met and unanimously agreed that I stepped into his shoe immediately to prevent a vacuum. This is in line with our structure and the provisions of our Act. Recall that this was announced at the said AGM and in line with our openness, effective and professional communication procedure. The Institute also issued a Press Statement to the media, I am sure you are aware to forestall speculative reporting of the matter. Could you relate the development to the relevant rules guiding the operations of the CIS? Thank you. This question is similar to my earlier explanations. Our Institute has a clear structure for succession. Our rules provide that if the President cannot act for any reason, the First Vice President steps in. It is straight forward, and absolutely consistent with our procedures. That is exactly what happened. At the AGM, it was announced that CIS has moved from losses spanning six years to profit. What are the critical success factors and how will these be sustained? When our team led by Albert E. Okumagba took over the mantle of leadership in 2014, we put in place clear strategies designed to reposition the Institute. This achieved results in the following areas – debt recovery, higher income from self-financing activities, efficient cost management and control and support from other organisations that share our vision. Our Institute has what it takes to be at the commanding height at the global level of professional organisations and we shall continue to explore more opportunities through without losing focus.

Vanguard, MONDAY, JULY 13, 2015 — 25

Corporate Finance

NSE creates Pension 40 Index to boost market performance By PETER EGWUATU

he Nigerian Stock Exchange (NSE) has created NSE Pension 40 Index as part of key initiatives to drive market optimisation. The NSE Pension Index conforms with the requirements of the Pension industry as specified in the Pension Reform Act 2014 (as amended) and Regulation on Investment of Pension Fund Assets as prepared and amended by the National Pension Commission. The new index provides tracking mechanism for PFAs, CPFA, Fund Managers and others that Invest in accordance with the PENCOM guidelines. It can also act as a benchmark for measuring performance and reporting performance to Retirement Savings Account (RSA) holders. Commenting on the new Index, Executive Director, Business Development, NSE, Mr. Haruna Jalo-Waziri, said: “Investors want a diversified way of measuring market movements which has a wider coverage of companies as is the global practices. The NSE Pension Index will provide investors with additional tool to make the most of Nigeria’s market. It will also encourage the development of other products such as Exchange Traded Products (ETP’s) and Index Futures in the Exchange”. The NSE Pension Index will have the top 40 companies

LAUNCH - From left , Akinde, EY Entrepreneur of the Year Award Leader for West Africa; Henry Egbiki, EY Nigeria Country Leader and Femi Akintunde, MD/CEO, Alpha Mead Facilities & Management Services Limited, at the Media Launch of the 5th Edition of EY Entrepreneur of the Year Award in Lagos. based on market capitalisation and liquidity. In addition, companies to be included must have Free Float Factor of at least five percent. The NSE Pension Index is a Total Return Index. Consequently, normal dividend payments will be reinvested and accounted for in the Total Return Index by a Divisor Adjustment. Similarly, special dividends from non-operating income require index divisor adjustments to prevent the distributions from distorting the

index (same with price index). The NSE Pension Index constituents would be reviewed, re-balanced, reweighted and changed once in a year on the first business day in January whereby constituents are changed (added or deleted) based on their market capitalization, liquidity in the previous twelve months and Free Float Factor. The Nigerian bourse began publishing The NSE 30 Index in February 2009 with index values available from January

1, 2007. On July 1, 2008, the NSE developed four sectoral indices with a base value of 1,000 points, designed to provide investable benchmarks to capture the performance of specific sectors. The sectoral indices comprise the top 10 most liquid companies in the Banking, Insurance and Food/Beverage & Tobacco (now Consumer Goods) sectors and the top five most capitalized and liquid companies in the Oil & Gas (Petroleum Marketing) sector.

Stanbic IBTC nets N68bn gross revenue in six months

tanbic IBTC Holdings Plc, a member of Standard Bank Group, has released its six months unaudited results for the period ended 30 June 2015, with gross earnings at N68.3 billion, an increase of 11 percent over the N61.7 billion recorded in the comparable period of last year. According to the result, which was presented at the Nigerian Stock Exchange, NSE in Lagos weekend, profit before tax during the period stood at N9.5 billion, while profit after tax was N9.6 billion. Total assets went up nine percent to N1.03 trillion from N944.5 billion in December 2014. The Group maintained adequate capital to support its business in half year (1H)

Chinese equities rebound

2015 which is well above the regulatory requirement. The group’s total capital adequacy ratio closed the period at 15.3 percent (Bank 13.9 percent), while the tier 1 capital adequacy ratio stood at 12.6 percent (Bank 10.6 percent). These ratios are well above the 10 percent minimum statutory requirement. Chief Executive Officer, Stanbic IBTC Holdings Plc, Mrs. Sola David-Borha, stated that the group is seeking to raise N20.4 billion in rights issue to support its planned growth opportunities as well as business risks and contingencies. “Stanbic IBTC’s performance recorded in the first half of 2015 was characterized by steady growth in its balance sheet whilst our strong focus on cost

containment helped to mitigate the impact of rising cost of funds and credit impairments on our operating performance,” she stated, adding that “our focus for the rest of 2015 is to reduce cost of funds and continue to resolve impaired risk assets to

Stanbic IBTC’s performance recorded in the first half of 2015 was characterized by steady growth in its balance sheet

ensure increased profitability by year end. We remain optimistic that we can achieve these goals.” Following the adoption of the holding company structure in 2012, the operating subsidiaries of Stanbic IBTC Holdings Plc are Stanbic IBTC Bank (including Stanbic Nominees Nigeria Limited), Stanbic IBTC Pension Managers Limited, Stanbic IBTC Asset Management Limited, Stanbic IBTC Stockbrokers Limited, Stanbic IBTC Trustees Limited, Stanbic IBTC Ventures Limited, Stanbic IBTC Capital Limited, Stanbic IBTC Investments Limited, Stanbic IBTC Capital Limited, and Stanbic IBTC Investments Limited.

hinese equities have bounced back over the last two days, but they’ve still shed more than $3 trillion in value in less than a month. From their peak on June 14, Chinese listed stocks lost $3.6 trillion in value by July 9, according to Bloomberg’s China Market Cap index. That’s comfortably more than the entire economic output of France. The chart above says it all. The Shenzhen Composite has cratered. Despite the bounce in stocks on Thursday and Friday, the benchmark has given up more than 75 percentage points of return for the year. Chinese investors took increasingly leveraged punts to chase the stock market higher. Margin debt rocketed more than five-fold in less than a year, overshot the top of the equity markets and then fell like the spirits of a reckless gambler.

IWG to participate at World Bank conference on Global Financing

Nigerian based NonG o v e r n m e n t a l Organisation, “I Will Give” (IWG) be participating at a World Bank organized conference on global financing facility holding in Addis Ababa today, Monday July 13, 2015. The IWG team will be led by its Head of Secretariat Dr. Lola Dare and two other Steering Committee members who are on its governing council. The conference would be collating inputs and setting new global Agenda on the theme “Supporting reproductive, maternal, newborn, child and adolescent health” in the post Millennium Development Goals landscape. Speakers at the conference would include, Tim Evans, the Senior Director, Health Nutrition and Population, Global practice at the World Bank group; Ariel Pablo’sMendez, the Assistant Administrator, Bureau for Public Health, USAID; and Monique Vledder, Programme Manager for the Global Financing Facility (GFF) at the World Bank. C M Y K

26 — Vanguard, MONDAY, JULY 13, 2015

Business & Economny

Turnover in OTC market hits N9.76trn

urnover in the OTC market for the month of June 2015 was N9.67trn, a decline of 17 per cent or N1.95trn compared with the previous month’s and a 60 per cent or N3.62trillion increase compared to June 2014 Activities in the T.bills and FX segments of the OTC markets jointly§ contributed 64% to the total turnover, down from 67 per cent recorded in the previous month Repurchase Agreements/BuyBacks recorded an increase over the review period whilst Forex , FX, Treasury , T. bills, FGN bonds and Unsecured Placements/ Takings declined Meanwhile, total turnover in the fixed income market was N4.33trillion, a decline of 23 per cent or N1.32billion compared with May. Activities in the Treasury, T.bills market accounted for 88 per cent of total fixed income turnover; up from 85 per cent recorded in the previous month. On a year-on-year basis, turnover of T. bills and FGN bonds increased 105 per cent and 11 per cent respectively. Trading intensity1 of T.bills and FGN bonds for the month of June settled at 0.60 and 0.12 respectively against 0.75 and 0.18 recorded in May. Yields on fixed income securities in

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the month indicated mixed sentiments as 1M2 , 6M, 12M and 15Y 3 benchmark securities declined whilst other benchmark securities

inched upwards. On aggregate, the yield curve was up 23 bases points, bps in the review period. Outstanding FGN bonds stood at N4.84trillion, 2 per cent or

N91.85billon above the value as at May, with market capitalisation declining N1.54billion to close at 91 per cent of face value, or

N4.41trillion. T.bills outstanding on the other hand declined 2 per cent, or N124.45billion, to stock at N6.28trillon as at the end of June.

Entrepreneurship critical to development of economy — EGBIKI By PETER EGWUATU

rnst & Young, EY Nigeria has stated that entrepreneurship is critical to the development of any economy, as it called on Nigeria government to encourage entrepreneurial spirit by providing necessary support. Speaking at the media launch for the 5th edition of EY Entrepreneur of the Year Award, Mr. Henry Egbiki, EY Nigeria Country Leader said “When you look at the matured economies, one would see that entrepreneurs are the people that pioneered growth in those markets. We can see that in Nigeria, Gross Domestic Product, GDP has gone down due to economic downturn and unemployment is on the rise and for it to pick up,

it requires the activities of entrepreneurs.” Continuing, he said “The gap in infrastructure and unemployment is going to be solved by entrepreneurs. These are the reasons why we are celebrating these entrepreneurs to spur the younger ones. Business is about shared value and not about profitability alone. As they tell their stories people are encouraged to invest in businesses. Commenting on EY Entrepreneur of the Year Award, Bunmi Akinde, EY Entrepreneur of the Year Award Leader for West Africa, said “ EY Entrepreneur of the Year, EOY began in the US in 1986, and we continue to expand the program internationally. We now have over 145 EY Entrepreneur of the Year programs in over 60 countries and EOY is the only global program of its kind. EY World Entrepreneur of the Year was created 15 years ago in 2001 as a natural extension of

our success in running EY Entrepreneur of The Year award programs around the world. According to her “2015 is the 15th anniversary of World Entrepreneur o f the Year. Over 15 years, there have been 572 companies represented at EY World Entrepreneur of the Year across 73 countries – all were EOY Winners in their home countries. The EY Entrepreneur of the Year program raises awareness of the important contributions that entrepreneurs make to the global economy and to their community. On why EY supports Entrepreneurs, she stated that entrepreneurs are critical for the health of the global economy. According to her “They create jobs, generate wealth and encourage creativity and competition. They also

drive innovations that address some of the world’s most pressing problems. And they inspire the next generation to innovate. By helping great entrepreneurs to scale, and shining a spotlight on their achievements, we are helping to fulfil our purpose, to build a better working world. Entrepreneurs drive innovation and economic growth, and create jobs. And we focus on the future workforce, from employees to young entrepreneurs, because we know that the next generation is critical to global progress. Akinde, further stated that the awards aim to recognise the exceptional innovations and achievements of West African entrepreneurs and their efforts in creating jobs and contributing to the growth of the country’s economy.

Vanguard, MONDAY, JULY 13, 2015 — 27

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28 — Vanguard, MONDAY, JULY 13, 2015

Homes & Housing

A privately developed bungalow

What to consider before renting or buying a house Stories by YINKA KOLAWOLE

nvesting in real estate has proven to be profitable - however, a good knowledge of what to buy or how to invest in the property market is crucial to avoid unwanted expenses in the future. Lamudi Nigeria lists a couple of tips and ideas to consider when planning to enter the property business. Your budget Set yourself a manageable budget and stick to it. Agents usually market rental properties by stating the yearly rental price. For those who want to buy, be clear about what type of property you want. Is it for personal use or investment purposes? Try not to be tempted to look at properties beyond what you can comfortably afford. In addition to your rental costs, you will also need to budget for other related expenses. These might include service charges if the property is in a block of flats or on an estate, so clarify with your agent or landlord whether they are included in the rent or are an additional charge. Other expenses to consider are the refundable deposit, moving costs, decoration of the property, furniture, or generator. Location There are plenty of factors to consider when thinking about the location of a property. It is important that you prioritise what is the most important to you in terms of location before starting your search, as this will save you time in the long run. For example, how important are C M Y K

the local amenities to you? Check the distance to your workplace and schools, access to shopping areas, and public transport, closeness to friends or relatives. It is worth prioritising those and any other factors that may be relevant to you to help you determine your ideal location and to make your search as clear as possible. Other considerations

There are plenty of options for those looking for property to rent or purchase, in terms of the types of accommodation. Much will depend on your personal circumstances and your life stage, i.e. position at work and most importantly your purchasing power. Searching for the ideal property In addition to the internet,

which has much information within a mouse click, there are a number of other ways you can search for property. These might include newspapers, but be aware that by the time many papers are printed, some properties may have already been let. You can also contact well-known developers or estate agents directly. Call the estate agents and ask for details of relevant property, and if it sounds interesting arrange a viewing. It pays to contact a few agents to give you the best chance to find the right property. Drive around the area you are interested in and have a look at any “To Let” or “For Sale” signs and write down the contact details. Keep in touch with agents regularly, as rental properties tend to come and go quite quickly, particularly in some popular areas. Costs Be aware that once you have found a property, agents and solicitors will charge you a fee. These can range from five to 10 percent of the total costs depending on the agents, the property and the location. Try to establish and negotiate these costs with the agents in advance as they may vary. Overall, before you begin the task of viewing a property, make sure you clarify with the agent that the house or flat meets your requirements, the costs and the fees so that you would not waste your time.

FG committed to affordable housing provision — OSINBAJO

he Federal Government has reiterated its commitment to the provision of affordable housing for Nigerians in partnership with the private sector. Vice President Yemi Osibanjo stated this in his keynote address at the 2015 Abuja Housing Show & Housing Development Awards, in Abuja, with the theme: “Delivery of Affordable Housing: Financing, Building Technology and Land Issues in Nigeria”. Osinbajo who was represented by Senator Osita Izunazo, declared that land acquisition and funding are the most pressing issues currently affecting housing provision in the country. He asserted that housing is pivotal to the agenda of the Buhari administration. This year’s conference which is the 9th edition, which was to help raise awareness on the critical nature of housing needs in the country, addressed the challenges facing the real estate industry by formulating growth strategies. Participants critically appraised existing

housing policies with a view to remoulding and developing new ones in order to build enduring structures to enable faster housing delivery in the country. Experts in the built environment used the platform created by the

Housing is pivotal to the agenda of the Buhari administration organisers to showcase their activities in the sector. In his opening address, Festus Adebayo, the convener of the Housing Show, highlighted the challenges bedevilling efforts in the housing sector and emphasized the need for stakeholders to continue discussions and dialogues as well as share experience on innovative ways of dealing with housing issues. “The premise on which the theme of the 9th Abuja Housing Show

was formed was based on the need to get the new administration in Nigeria to prioritise the housing sector in its agenda. Therefore, it is expected that government would make use of the proceedings from this event to move the housing sector forward,” he said. On his part, Professor Charles Inyangete, Managing Director /CEO Nigeria Mortgage Refinance Company (NMRC), took a closer look at the need to facilitate broader access to affordable housing finance for Nigerians. He enumerated some of the bottlenecks militating against the delivery of affordable housing in Nigeria. These, according to him, include: complex land registration and titling; high and volatile interest rates; short tenor of mortgages; lengthy and complicated foreclosures; high building costs; and absence of mortgage insurance. He said NMRC has unveiled initiatives aimed at stimulating investment in the mortgage market and delivering affordable housing in general.

Kano plans better housing scheme for workers

ano State government said it is committed to providing a realistic housing scheme for workers in the state.Governor Abdullahi Ganduje has therefore tasked labour unions in the state to join hands with his administration to achieve the set goal. This was revealed in a statement by DirectorGeneral, Media and Communications to the Governor, Baba Halilu Dantiye. The governor lamented that a sustainable housing scheme for workers had not been realised despite their immense contribution to the development of the state. He asserted that it was time workers got permanent shelter for their families, adding that, “in advanced countries, if you are working, you have shelter”. Ganduje made the assertion at a meeting with members of the state branch of Nigeria Labour Congress and the Nigeria Union of Journalists at the Government House in Kano.

Mortgage rates dip amid global economic concerns

verage long-term U.S. mortgage rates fell last week, retreating from high levels for the year amid economic turbulence overseas. The lower rates brought an incentive for prospective purchasers toward the end of the spring home buying season. Mortgage giant Freddie Mac said that the average rate on a 30-year fixed-rate mortgage declined to 4.04 percent from 4.08 percent a week earlier. The rate on 15year fixed-rate mortgages eased to 3.20 percent from 3.24 percent. Markets around the world have been nervously watching tumult and a nearly month-long slide in China’s stock markets, and Greece’s economic crisis as it tries to negotiate a rescue from its European partners. That has pushed investors to seek safety in U.S. Treasury bonds, pushing interest rates lower. Bond yields for Treasury have been pushed lower by the rise in bond prices. Mortgage rates often follow the yield on the 10-year note.

Vanguard, MONDAY, JULY 13, 2015 — 29

Business/Economy FG grants port status to Kaduna inland container depot

HE Federal Government has declared Kaduna Inland Container Depot (ICD) a port of origin and final destination to extend shipping services to hinterlands and landlocked areas to decongest the ports. Notice of the declaration is contained in a statement signed by Mr Ignatius Nweke, the Deputy Director, Public Relations of the Nigerian Shippers’ Council (NSC), made available to newsmen on Friday in Lagos. According to the statement, the declaration is contained in a government gazette No 60 Vol. 102 of May 26, 2015, entitled “Kaduna Dry Port Declaration Order, 15”. The NSC said “it is expected that the Kaduna Inland Dry Port will have the status of international port, including customs, immigration, port health officials, as well as government security agencies.” The statement noted that the gazette, which was signed by the former Minister of Transport, Sen. Idris Umar, had now upgraded the Inland Container Nigeria Ltd. (ICNL) Bonded Terminal, Kaduna, to the status of dry port of origin and final destination. “The gazette indicated that the newly-designated port with the capacity to handle 29,000 containers per annum shall be a customs port. This is in accordance with the provisions of the Customs and Excise Management Act, Cap. C 45 Laws of the Federation of Nigeria, 2014.”

Nasarawa plans to create 10,000 jobs for unemployed youths

CEREMONY- From left: President, Association of Housing Corporation of Nigeria, Dr. Chukwu Ifenna; Chief Executive Officer, Fasadeb Communication, Fesus Adebayo; and Chairman, FCT Urban and Regional Planning Tribunal, Prince Seyi Lufadeju during the 9th Housing Show closing ceremony and award night held in Abuja. The Inland Container Depots (ICD) and Container Freight Stations (CFS) were initiated by the NSC to bring shipping services to the hinterlands and

country which were yet to be designated as port of origin and final destination in Ibadan, Kano, Jos, Aba, Funtua and Maiduguri.

Expert makes case for ship owners to access Cabotage Fund

HAIRMAN, Planning Committee, Nigeria Maritime Expo (NIMAREX) Mr Ayorinde Adedoyin, on Friday said ship owners should be allowed access to the Cabotage Vessel Financing Fund (CVFF).

Investors trade 475.01m shares worth N3.94bn on NSE Activities at the Nigerian Stock Exchange (NSE) on Friday remained on a negative note, just as investors staked N3.94 billion on 475.01 million shares transacted in 3,007 deals. The News Agency of Nigeria (NAN) reports that the volume of shares traded closed higher compared with 222.19 million shares valued N4.25 billion exchanged in 3,714 deals on Thursday. Multiverse emerged the most traded equity with an exchange of 210 million shares worth N105 million traded in five deals. It was trailed by Access Bank which accounted for 59.59 million shares valued N298.26 achieved in 255 deals, while Zenith Bank sold 31.91 million shares worth N603.10 million traded in 236 deals. FCMB sold 25.20 million shares valued N73.09 million exchanged in 44 deals and GT Bank traded 23.92 million shares worth N621.87 million transacted in 202 deals.

landlocked neighbouring countries in order to decongest the ports. The NSC statement indicated that there were other approved ICD/CFS in the

The market capitalisation dropped further by N9 billion to close at N10.835 trillion against N10.844 trillion recorded on Thursday. Similarly, the All-Share Index lost 38.97 points or 0.12 per cent to close at 31,729.26 compared with 31,769.23 achieved on Thursday. Forte Oil recorded the highest price loss to lead the losers’ chart, dropping by N5.24 to close at N180 per share. Unilever trailed with a loss of N2.10 to close at N39.90, while Nigerian Breweries dropped by 99k to close at N136.51 per share. Julius Berger lost 53k to close at N47.97, while Honeywell dipped 17k to close at N3.23 per share. On the other hand, C & 1 Leasing led the gainers’ table, growing by N7 to close at N158 per share. 7UP followed with a gain of N1 to close at N189, Lafarge Africa appreciated by 89k to close at N102 per share. Guinness garnered 87k to close at N139.50 and Okomu Oil Palm increased by 50k to close at N28.50 per share.

Adedoyin stated this in an interview with the News Agency of Nigeria (NAN) in Lagos. The Nigerian Maritime Administration and Safety Agency (NIMASA) has been the custodian of the fund since 2004 as stipulated by the Cabotage Act. He said government should also enforce the Local Content Act. Adedoyin said enforcement of the Local Content Act would bring positive developments to the maritime sector. He said that in 2016, with determination, the Expo would be made bigger. Adedoyin urged the stakeholders in the maritime industry to be more determined to enable them achieve their

goals. He said some of the companies which participated in the Expo were not known before now . “The whole idea of NIMAREX is to showcase what you have and allow people to see what you do, how you do it, and the value added service you can give to their business. We should continue to do what we do. We should continue to show people. “At least, this year I have been able to prove a point that at least we can do it. “If we are determined to do it by next year, they should come and we will make it bigger. The larger we are the better for all of us,” Adedoyin told NAN.

TrustFund Pension posts N1.1b profit after tax

RUSTFUND Pension PLC on Friday declared a profit after tax of N1.1 billion for the year ended December 31, 2014. The Board Chairman, Mrs Ngozi Olejeme, disclosed this during the 7th Annual General Meeting (AGM) of the company in Abuja. Trustfund Pension is one of the pension fund administrators (PFA) licensed to operate in the nation’s pension industry. Olejeme, represented by Mr Peter Esele, a Director in the company, said the company generated an income of N4.2 billion for the year 2014. She

said the profit before tax stood at N1.34 billion. the chairman said the company had also declared a 25 kobo ordinary share dividend for the 2014 financial year for members whose names appeared in the company ’s register as at December 31, 2014. She said the company had also declared the same dividend of 25 kobo in the year ending 2013. Olejeme said despite difficult business environment the company operated on in the year 2014, it was still able to maintain the same dividend.

ILAS Agara, the Nasarawa State Deputy Governor, on Friday in Lafia said the state government had concluded plans to create 10,000 jobs. Agara said this when he received a Nasarawa State Students Association (NASA) delegation who paid him a solidarity visit. He said the move was in an effort to provide jobs for unemployed youths in the state before the end of Gov. Umaru Al-Makura’s administration. Members of NASA were drawn from tertiary institutions in the state. The deputy governor said the state government was not happy about the growing army of unemployed youths in the state and was determined to bring it to an end.“As soon as the financial profile of the state improves in the coming months, the state government will employ the first set of unemployed youths through the creation of job opportunities. The state government has resolved to provide jobs for the employment of the young graduates who are roaming the streets in the state without any means of livelihood. We only want to appeal to them be patient with the government,” he said.

Stock market operators call for more participation of FG, local investors in nation’s bourse

OME capital market operators on Friday advised the Federal Government and local investors to participate more actively in the market in view of recent developments in China. They said in Lagos that the Federal Government and market regulators should introduce policies that would boost local investors’ participation in the market. The operators also urged the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) to look into ways of increasing local participation instead of scouting for foreign investors. Mr Ariyo Olushekun, the immediate past President, Chartered Institute of Stockbrokers (CIS), said that Federal Government should show more interest in the stock market for economic growth and development. Olushekun said that the National Pension Commission (PenCom) should give more powers to the Pension Fund Administrators (PFAs) to invest higher percentage of the funds in stocks.

30—Vanguard, MONDAY, JULY 13, 2015

Micro-Finance

Database creation crucial to informal sector inclusion in contributory pension scheme — Expert A pension expert, Mr Omabise Baro, said that the inclusion of the informal sector in the Contributory Pension Scheme (CPS) would require the creation of a database. Baro told newsmen in Abuja that it was important for the regulator to first register the organised private sector preparatory to incorporating its members into the scheme. “To widen the base - well is not going to be over night, is not simple, it will require ensuring that we have a good database, we can identify these companies. “People have to be registered; we have to be cautious before we start talking about welders and artisans, I would say even the private sector that is not very organised - that is people who own small businesses, that the businesses are registered - I think that is where we should go first before we start talking about people who don’t have a business name, who are just hawking product or services on the street. “So, we should take it from public sector, organised private sector where we are today and then take it a step lower to smaller businesses.“ The new Pension Reform Act 2014 has made provision for the inclusion of the informal sector in the contributory pension scheme. Following the amendment to the Act, stakeholders have repeatedly asked questions on how the inclusion of the informal sector will be a success. Baro suggested the inclusion of a compliance mechanism as part of measures that could be used to drive the private and informal sector inclusion in the scheme.

SIGNING: From left, Mory Soumahoro, Chairman, West Africa Securities Regulators Association (WASRA), Mounir Gwarzo, Director-General, Securities and Exchange Commission, SEC Nigeria and Adu Antwi, Director General, SEC Ghana during signing of MoU on WASRA, in Abuja. Stories by PROVIDENCE OBUH

ccion Microfinance Bank (AMfB) is targeting micro entrepreneurs and low income earners in Port Harcourt (PH) Rivers State with a viewing to expanding beyond Lagos. The bank with about 20 branches in the south west region has been operational since inception in 2007. In a statement from the bank, the opening of a new branch in PH near Mile One

Accion MfB eyes low income earners in PH Market further emphasizes its mission to economically empower micro-entrepreneurs and low income earners by providing financial services in a sustainable, ethical and profitable manner thus improving the socio-economic

well-being of Nigerians and also demonstrating the bank’s commitment to financial inclusion in the country. The bank added that it is expanding across the country to further provide professional financial services to customers

GEC powers overseas admission for 7,000 students in 14yrs O

ver 7000 Nigerian students have been offered admission to school abroad through Global Education Counseling (GEC) in the last 14 years. Meanwhile, about eight students graduated penultimate week, from its Management Education Training (MET) centre in Lagos to study at Debreceen University in Hungary. Speaking at the graduation ceremony in Lagos, Chief Executive Officer, GEC, Mr. Theo Theodorou, said that the programme had guaranteed over 7,000 admissions into its partner Universities in the UK, Canada, Europe, US, Malaysia, among others. He said, “We are working

hard to develop young skills and for them to become independent, to grow up and be able to face the challenges ahead of them. Their exposure to our University partners has allowed them to interact with them and hear first hand what they will expect when they reach their chosen universities. “The challenges we face in Nigeria do make us all focused and determined to succeed. This is reflected by the sound academic delivery of the pragramme to guide the wards to a successful outcome overcoming the day to day challenges that they have faced to name a few, NEPA, Lagos traffic,” he said. On her part, Registrar,

GEC, Mrs. Amaka Enweluani, disclosed that the programmes offered at GEC MET include: International Degree Foundation Programme; International Medical Foundation Programme; International Pre-Masters Programme; Cambridge Advanced Level and International General Certificate of Secondary Education (IGCSE). She added that the programme runs three sections in a year with lectures based on academic works and research to ensure the students get the basic knowledge of their different specializations.

mainly in the lower strata of society who are unbanked or do not have access to regular banking services. According to MD/CEO AMfB, “We have consistently transformed our customer ’s businesses by giving them easy access to loans and other financial services. This is the value we bring to the Port Harcourt. We will continue to serve our customers to give them a brighter future.” She further added that the expansion plan for the bank is in realisation of the bank’s national expansion programme. Meanwhile, the bank has disbursed over N38.5 billion loans to over 36,000 customers since inception, with a current customer-base of over 168,000 and a fully paid-up share capital of N1.205 billion as at December 2014, as well as total assets of over N3.06 billion in the same year.

The bank has disbursed over N38.5bn loans to over 36,000 customers

C M Y K

Vanguard, MONDAY, JULY 13, 2015 — 31

E- Commmerce

Suregifts leverages technology to drive employee, customer rewards STORIES BY JONAH NWOKPOKU

igeria’s online gifting p l a t f o r m , Suregifts.com.ng has introduced an online solution that leverages technology to drive and improve the process of employee and customer rewards. Suregifts offers a platform for organizations to purchase gift cards for as many employees as they want with each gift card tied to a monetary value which employees can redeem at over 50 top retailers of their choice nationwide. Speaking on what motivated the solution, the founders, Olaoluwa Samuel-Biyi, Babafemi Lawal and Adeoye Ojo said they understood the role of gifting in corporate culture and how it helps to drive employee motivation. They said: “The average employee in the Nigerian workforce looks to his rewards as a big part of his motivation towards work; this therefore has made the importance of a rightly motivated employee a major one to every organization. This is the reason why many corporate organizations and employers of labour want to get it right always. We noticed that professionals and business people wanted to reward colleagues and clients but did not know what to get them.” According to them, “The discovery that one of the biggest headaches to organizations is what to procure, how to procure and the most effective logistics solutions to employ has given us a push in the right direction to introduce this solution. The Human Resources, HR departments of many organizations get regular complaints of employee rewards not done right and the reasons are not farfetched. A reward that does not hold any importance to the receiver cannot really be appreciated as one.” They argued that the concept of gift cards from Suregifts Nigeria has now taken the strain off HR and Procurement managers as they are now relieved of the worries, tensions and stress that comes from rewarding employees. The trio who also run an online consultancy service that helps prospective customers and human resource managers figure out

their homes.” Also speaking, a Port Harcourtbased employee of a pan-African l o g i s t i c s company who p l e a d e d anonymity narrated how he had racked up N76,000 in rewards for an impressive performance in 2014 but when he travelled to Lagos for the end of year party to pick up his supposed cash bonus he was UNVEILING: From right, Mr Oghuzan Silivrili, Marketing Director, Reckitt instead handed Benckiser West Africa; Helen Paul, Harpic Brand Ambassador and Omotola a gift card of Bamigbaye-Elatuyi, Marketing Manager, Reckitt Benckiser West Africa at equal value. “My wife was the unveiling of the new Harpic TVC and Brand Ambassador in Lagos. glad the Photo: Lamidi Bamidele remuneration was cashless and that meant appropriate gifts or rewards company, commenting on I couldn’t squander it on for corporate clients, noted how his organization has frivolities,” he said. “We had that since the introduction of benefited from the solution to buy groceries and a the platform, the solution has said: “Rather than deal with smartphone with it.” been embraced by many the trouble of transporting In recent times, Suregifts organizations in Nigeria, tonnes of rice to staff members has powered employee mostly driven by its cost during the Christmas festive rewards for over 50 effectiveness and flexibility of season, we just handed them organizations including use. gift cards which they shopped Oando, FBN Capital, Wema Charles Ojakaro, a human online with for whatever they Bank, KPMG, DHL, Black resource person at an oil desired, and was delivered to House Media and Dangote

‘Logistics, key to unlocking e-commerce potential in Nigeria'

ritical logistics infrastructure must be put in place if the full potential of e-commerce in Nigeria must be realised, this is according to the Managing Directors of African Courier Express, ACE Tunde Kehinde and Ercin Eksin. The duo who pioneered ecommerce in Nigeria as cofounders of the online retailer, Jumia.com said that while e-commerce will play significant roles in the economic boom that is expected in the coming years, logistics presents a unique challenge that must be tackled before the objective will be attained. “The Nigerian ecommerce market presents unique challenges. Nigerians are not as trusting of online retail as most westerners, and this means that most online retail in Nigeria is pay- ondelivery. In Nigeria, this leads to logistics issues concerning finding

customers at a time when they have the cash for their purchases, and issues surrounding cash remittance to the merchant. For many companies, the difficulty of mitigating this logistical challenges have been a barrier that keeps them from effectively pursuing ecommerce,” said the duo in a media chat recently. “These are the conditions that led us to create Africa Courier Express (ACE), a

Nigerians are not as trusting of online retail as most westerners

company that aims to completely redefine the way e-commerce is handled, by placing focus on creating a technological infrastructure and adapting processes that will allow Nigerian – and by extension African ecommerce to grow stronger,” they added. According to them, “ACE’s technology, all developed inhouse by talented, young, entrepreneurial minds, allows us to provide merchants with more details and information about their shipments – enabling them to make better business decisions. ACE manages tasks with a multi-faceted technological system that can be adapted to meet merchants where they are. “Whether by use of a full API integration, managed by ACE, or through a unique Pick-Up-Tool created inhouse, orders are inputted into and subsequently tracked throughout ACE’s unique system.

Mexico City to place fleet limit on Uber cars

exico City could become the first city in the world to limit the number of Uber cars, according to draft regulation that the company said last week also threatens to wipe out its most popular service in the giant metropolis. Aside from the fleet limit, the plan seen by Reuters aims to enforce a minimum car value of 250,000 pesos ($15,909) on Uber and companies like it, a big worry for the ride-hailing service that is coming under increasing pressure from regulators. The San Francisco-based company said the minimum value would hit hard Uber X, its cheapest and most popular service used by 90 percent of drivers. The startup cost to most drivers using the service was about 150,000 pesos, Uber said. “This would imply the end of Uber X,” the company said in a statement. “This would dramatically increase the cost and decrease availability for Mexican riders.”

Samsung to launch new Galaxy Note phablet mid-August

amsung Electronics Co is bringing forward the launch of a key premium smartphone model, the new version of its Galaxy Note phablet by mid-August, according to a Reuters’ report last week. Recall that previous versions such as the Note 3 and 4, typically launched in September. A Samsung spokeswoman declined to comment. The mid-August launch will likely put the new Note smartphone model on the market ahead of arch-rival Apple Inc’s next iPhones. The U.S. company is preparing for its largest initial production run for new phones so far by the end of the year, the Wall Street Journal reported earlier last week. Samsung is seeking to rebound from a disappointing 2014, when its annual profit hit a three-year low as smartphone earnings slumped.

32 — Vanguard, MONDAY, JULY 13, 2015

C M Y K

Vanguard, MONDAY, JULY 13, 2015 — 33

“Power consumer advocacy network collapses after two months.” PUNCH, Friday, July 3, 2015, p34.

he story by Okechukwu Nnodim, writing from Abuja went on to say that “The Nigerian Electricity Consumer Advocacy Network, which was inaugurated by the Nigerian Electricity Regulatory Commission about two months ago has collapsed.” Reading the report, it is obvious that the NERC and the members of the Nigerian Electricity Consumer Advocacy Network, NECAN, cannot agree about who is to fund the programme. There is fault on both sides as will be demonstrated presently. But first a few questions need to be answered. Who are the members of the NECAN and how were they selected or appointed to represent consumers? Which consumer groups do they represent, private, corporate, public or foreign missions? The second question is important because all the Governments of Nigeria, Federal, States and Local Governments are also consumers; so are foreign missions (US Embassy, British High Commission etc). When were they recognized as an advocacy group? And why was NERC, itself a consumer, inaugurating NECAN if it had no intention of funding it? For NECAN, only two questions will be sufficient. Who sent them on this mission? And did they embark on it

POWER CONSUMER ADVOCACY:

Matters arising expecting the Federal Government to fund it, in other words, another piece of cake to share? Permit me to start with NECAN and the advocacy it had undertaken. As someone who had been involved in advocacy before, Christian Governor in Lagos State in 2015 being the latest, it would appear that altruism is lost the minute those embarking on advocacy rely on third parties, government or otherwise, for the initial funding. Christian Conscience, CC, an NGO which resulted from my articles in November 2011 was funded exclusively by the members, and, later, some well-wishers. No appeal was made to government or any of the political parties who were the targets of our advocacy. The principle is clear, “Who pays the piper dictates the tune.” Once your programme is funded by government, there is proscription on what you can do. With regard to electricity, the service quality and the charges, the Federal Government had handed us over to the Distribution Companies, DISCOs, without spelling out for us what our rights as consumers under private companies will be. In fact, by the very pregnant silence, the Federal

The Federal Government had created a class of privileged private companies, called DISCOs, which can rob consumers at will – without any apparent recourse Government had created a class of privileged private companies, called DISCOs, which can rob consumers at will – without any apparent recourse. The NERC is an agency of the Federal Government, and was a party to this rape of the consumers. Clearly, it makes no sense to expect NERC to promote an advocacy network whose objective is to liberate consumers from financial slavery. NECAN should never have been inaugurated by NERC. There is another reason for NERC to stay out of this advocacy. This time it involves fairness to the DISCOs. Much

as we love to hate them, there is still a need to ensure that as we move towards resolution of several contentious issues between us as consumers and the DISCOs, we must still be aware that we are fighting with our friends and Fellow Nigerians – not foreigners and enemies. And when the fight is over, meaning when all issues have been resolved, they will still be our friends and Fellow Nigerians. NERC, which is part of government, has no business sponsoring NECAN because that would amount to the Federal Government sponsoring one group of citizens (consumers) against another group of corporate citizens (the DISCOs). I am not a shareholder in any DISCO and will not be. But, in fairness to DISCOs, the NERC had no business inaugurating NECAN. It is just as well that it had collapsed like a sand castle built on the beach by kids. That still leaves unanswered the question: should there be a NECAN or something like it? The answer is definitely YES!!! But, on what foundation should it rest? “Hereditary bondsmen, know ye not who would be free must strike the blow?” Lord Byron, 1788-1824. (VANGUARD BOOK OF

QUOTATIONS, VBQ, p 67). History is replete with examples of injustices and inequities endured by people until they themselves rise up to say “Enough is enough”. Before Christian Conscience, I had been involved in other advocacies. One other effort resulted in Alternative Dispute Resolutions, ADR, now an integral part of our legal system. With Nigerian Courts being overburdened, justice delayed, cost of litigation escalating, it was obvious something needed to be done. Governments were not the game-changers, people like Barrister Kehinde Aina of NCMG, and others were. But, the first great break when a friend of mine, William Braxton, then in the US Embassy, helped to bring a retired US Judge to deliver a lecture on ADR. Prior to that, in the late 1960s, I was a warrior, in every sense of the word, fighting for black Americans to be able to vote. I still have the scar from one violent encounter. Today, Obama is President of USA. Governments never assist in redressing injustice until the victims themselves act. If we want a strong Nigerian Electricity Consumers Advocacy Network, then it must be financially independent of governments and headed by people ready for combats not cake-sharers. The justice for which that network will fight will be lasting and NECAN will constitute the peoples’ watch dog over DISCOs. But, we must create it ourselves.

Business & Economy

CBN to support revamp of oil sector B

arely a week after pledging support for rice farmers and processing companies in Nigeria, the Governor, Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, CON, has underscored the Bank’s determination to lead the revitalisation of the oil palm sector in Nigeria in order to provide jobs for Nigerians. Mr. Emefiele made the pledge in Abuja on Friday, July 10, 2015, during a meeting between the Bank’s management and oil palm value chain stakeholders to agree on a road map to resolve the challenges in the oil palm value chain in Nigeria. He expressed concern at the contrasting fortunes of Nigeria from being the largest C M Y K

producer of palm oil worldwide in the late 1950s and 1960s, to becoming a net importer of the commodity from the 1980s to date. According to him, Nigeria currently lags behind in a distant fifth position in world production, behind countries that many years ago sent emissaries to Nigeria to learn production techniques and to get their first seedlings. Mr. Emefiele also decried the practice where huge amounts are spent to import items that could ordinarily be produced locally, the Governor stressed the need for all stakeholders to collaborate restore the glory days to the oil palm sector in the country. While recalling the recent policy of the CBN that excluded 41 items from being

procured with foreign exchange from the Nigerian foreign exchange markets (Interbank and BDCs), Mr. Emefiele reiterated that the policy measure was introduced to help conserve Nigeria’s foreign reserves as well as facilitate the resuscitation of domestic industries and improve employment generation in the country. He said the CBN decided to take the lead and play a major role in the resuscitation of the oil palm sector and decided to take a bold step and include Palm Kernel, Palm Oil Products and Vegetable Oils in the exclusion list of items not valid for foreign exchange at the Nigerian Foreign Exchange window. Mr. Emefiele also reiterated

that the decision taken by the CBN to include palm oil products in the exclusion list was taken after a thorough analysis of the sub sector. This, he said, was taken in the overall interest of the country, for the resuscitation of the local oil palm industry and to improve employment generation in the country. “For the country to attain self-sufficiency there has to be committed development of more estate plantations and coordinated partnerships between the small holder plantation farmers and processors,” he said. Accordingly, he said the CBN, as part of its developmental initiatives, had introduced the ‘Anchor Borrower Programme’ designed to create economic

linkages between small holder farmers and processors by organizing farmers into cooperatives to boost production and take advantages of economics of scale While enjoining all stakeholders to see the present situation as an opportunity rather than an adversity, he charged all to collaborate with the CBN to ensure that the country stops exporting jobs abroad and in the process importing poverty. It will be recalled that the CBN management last week in Abuja met with officials of State Governments and rice processing companies to strategise on increasing the low utilization capacities of rice mills in Nigeria.

34 — Vanguard, MONDAY, JULY 13, 2015

People in Business

We assist parents in moulding, shaping their children’s overall character – Nonyelum Arinze By Ebele Orakpo

s. Nonyelum Arinze is the Managing Director/Chief Executive Officer of Ben ‘N’ Glad’s Haven (BNG Haven), a childcare centre based in Enugu, Enugu State. In this chat with Financial Vanguard, Nonny, as she is fondly called, speaks on why she left the banking industry to follow her dream and also the challenges and her vision for BNG Haven. Excerpts: Background: Nonny, a graduate of Medical Parasitology and Entomology from Nnamdi Azikiwe University, Awka, Anambra State, is a graduate member of the Nigerian Institute of Management (NIM) and has a Diploma in Children Studies and Human Resource Management. She will be rounding off her Master’s in Business Administration at the ESUT Business School in September. Upon graduation from the Nnamdi Azikiwe University, Nonny did her one year compulsory *Nonyelum Arinze...Working in the banking sector helped to prepare me service to fatherland at the General and gave me the needed experience Hospital, Suleja, Niger State. While still serving, she got employment at the First City Monument Bank Plc in Minna, with their children. having passed the relevant tests. So as "My motivation for this soon as she completed her service year, business is to help bridge the she resumed work in the bank and was gap and assist parents in the there for over six years. moulding and shaping of their child’s overall behaviour, Why I left banking: attitude and character. It is a According to Nonny, being an good thing that parents have entrepreneur has always been her careers to pursue and all, but ambition so while she really enjoyed on the flip side, our children working in the banking sector for over (who we always say are the six years, she was always conscious of custodians of the future), the fact that she was going to leave to burden I have whenever I looked at most children shouldn’t have to suffer for it. born in this generation where parents are so careerstart up her own company. If they are truly the custodians She said: "Working in the banking driven and most times don’t have enough time to spend of the future, then there is need sector helped to prepare me and gave me the needed experience. "I’ve always known I had business, leadership and administrative qualities so working in a corporate organisation like the bank helped to fine-tune those qualities coupled with the fact that I have a burden to impact *Some of the children havsociety positively and be a part of the much needed ing fun change. The banking industry didn’t give the platform I needed to express that desire so I knew it was inevitable to leave at some point."

I have always had this strong connection to children and my love for music helped to make the passion strong

Motivation: "I have always had this strong connection to children and my love for music helped to make the passion strong. The motivation to start a childcare centre for children of all ages was born out of the C M Y K

to invest in them." Why BNG Haven: "The name is a combination of my dad’s (Ben) and Mum’s (Glad) names. The Haven part of the name simply means Safe Place because my desire is to provide a safe place for children to have fun, learn and interact with their peers. It was a vision that was inspired by my mum before she passed on in 2009 so after years of grieving and struggling to raise funds to start it after she died, I decided to do it in her honour," she said. The outfit which was officially opened and dedicated towards the end of September last year, started full operations in January. "I started with one pupil and as at today, we are 27. Five pupils in the creche, two in preschool and 20 students in Ballet Dance School. Presently, I have four staff including myself." Initial capital: "Initial capital which includes start-up funds and rent was N2.5m which I raised from my savings, family and friends. My dad and siblings helped a lot especially my dad at the setting up stage." Challenges: For Nonny, the major challenges are funding and publicity. "Being a one-man business per say, money for working capital and possible expansion is very tight. Publicity and funding actually go together because without money, it is almost impossible to effectively publicise the company and being a new business, good publicity is very essential. Another challenge is not being able to get people that will buy into the vision enough to support, partner or invest. Being a start-up, most people in the position to invest are sceptical and a bit averse to the idea of supporting a new business." In the next five years... "In the next five years, I see this business expanding to the point that it will be a complex of some sorts. By this I mean, we will now be located in our own complex large enough to contain the enormity of the vision with its various services. I see the business having branches in major cities in Nigeria because the saying that it takes a whole nation to raise a child, is true. I see this business having a prominent voice in all things children, education and childcare. I see it financially stable enough to offer employment to thousands of Nigerians and I see it grow beyond the boundaries of Nigeria," she enthused.

Vanguard, MONDAY, JULY 13, 2015 — 35

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36 — Vanguard, MONDAY, JULY 13, 2015

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Vanguard, MONDAY, JULY 13, 2015 — 37

Aviation

AIB investigates Emirates, Hak Air ground accident at Lagos Airport BY LAWANI MIKAIRU & DANIEL ETEGHE

he Accident Investigation and Prevention Bureau, AIB, has commenced investigation into the ground accident involving a Boeing 777-200LR belonging to Emirates Airline and a parked plane of Hak Air which occurred last Monday night at the Murtala Muhammed Airport, Ikeja, Lagos. The incidence which occurred around 9.30pm had the B737-400 plane owned by HAK Air badly damaged. According to Head, Public Affairs, AIB, Mr. Mr Tunji Oketunbi, the agency has “adequately deployed a team of investigators to determine the circumstances surrounding the serious incident with a view to making possible safety recommendations”. Oketunbi further said the aircraft marked A6-EWD was

taxing for a take-off en-route Dubai when its wing tip cut into the B737-400 aircraft parked on the apron of the domestic wing of the airport. While the Emirates aircraft had a little damage on its

wing tip, the Hak Air B737 “sustained substantial damage.” He added that the Emirates flight was aborted and the passengers were evacuated immediately.

Meanwhile, The Commissioner of AIB, Dr. Felix Abali had on Tuesday inspected the scene of the occurrence and promised that the investigation shall be handled with speed. “Every incident is a safety issue that must be thoroughly investigated. This will help in preventing accidents and sustain safety in aviation. This investigation will be conducted with speed”, he said.

MEETING - From left: Managing Director/CEO, Design Extra, Yemi Idowu, CEO, Wichtech Group, Dr. Chidozie Nwankwo, Lagos State Governor, Mr. Akinwunmi Ambode, Pastor in charge of The Redeemed Christian Church of God (City of David) and leader of the team, Pastor Idowu Iluyomade and Director, Julius Berger Plc, Dr. Mutiu Sunmonu, after the governor's meeting with investors at Lagos House, Alausa Ikeja. Photo: Bunmi Azeez

ART seeks stronger NCAA By LAWANI MIKAIRU & DANIEL ETEGHE

viation Round Table, ART, a nongovernmental organisation in the aviation industry, has called for a stronger Nigerian Civil Aviation Authority, NCAA, to enable the Authority discharge its functions creditably. This is just as the group accused the Asset Management Company of Nigeria, AMCON, of misplaced priorities in the bailout and takeover of some airlines in the sector. Speaking with aviation reporters at the weekend in Lagos, its President, Mr. Gbenga Olowo in his maiden speech after being elected to lead the organisation, traced the current woes in the sector to a weak NCAA. Olowo explained that aside the random checks on aircraft at the tarmac, the economic regulation of NCAA had failed to live up to expectations of stakeholders and professionals over the years. Olowo who argued that a stronger, viable and independent NCAA would be able to make airlines come together and seek a way of taking them out of the doldrums, opined that the current domestic operators should be merged to two or maximum three to make them

stronger, profitable and more reliable in their operations. He said: “The Civil Aviation Authority, CAA, should be the government of aviation like we have it in the Federal Aviation Administration, FAA, in the United States, which is the only government agency on transport. “Our NCAA is not there yet. The zeal of NCAA ended when Dr. Harold Demuren left the agency. The current

Director-General is more or less a civil servant. We need a vibrant CAA that will be able to take the sector to higher level. It is a shame that we don’t have any airline in this country. When we go outside the country for aviation conferences, people ask us ‘where are your airlines?’ We need a stronger NCAA for us to move forward.” The group also queried the sincerity of the Asset

Management Company of Nigeria, AMCON, in bailing out some airlines in the sector. ART maintained that the survival of any airline in the industry did not depend on the payment of debts owned financial institutions by airlines, but funds to increase their business operations and gradual payment of their debts to the banks.

Sesby Travels, at portal launch, highlights customer service By DANIEL ETEGHE

anaging Director of Sesby’s Travels and Tours Limited, Mrs. Sesby Adeola Banjo has revealed that the agency made about N1billion turnover on its ticket sales for the year 2014. This is just as she said that the agency would ensure that its customers would be adequately taken care of from the point of making their travel plans till they get to their final destination, stressing that the focus of the agency was to give a seamless travel experience to its passengers. Disclosing this development to newsmen

during the launch of the agency ’s portal in Lagos, Mrs. Banjo said that the agency was opening its portal to get in touch with its numerous customers. She said that the avenue would afford its numerous customers the opportunity to book online and do all their travel plans in the comfort of their bedroom. According to her, the customers/passengers could be given 25 per cent credit facility which would enable them to buy their ticket and pay one week later with zero per cent before they travel adding that, the product would help passengers to travel conveniently.

She said: “The agency is responsible for planning trip for passengers, arrange for their visa, book their hotels as well as provide shuttle for the passenger on arrival at the airport in order to take them to their destination. “We give good service at every point in time when dealing with our passengers. We guarantee cheaper or same fares with the airline” she added. Mrs. Banjo, however, noted that some of the challenges bedeviling the travel agency were cash, bankers trying to work as travel agent amongst others.

Union demands release of detained airport workers

he Air Transport Services Senior Staff Association of Nigeria ATSSSAN has condemned the detention of its members by the Directorate of State Security in Uyo Akwa Ibom State and has demanded for their immediate release. In a petition to the Director General of State Security Services dated 7 July 2015, signed by the General Secretary of ATSSSAN Captain Tarnongu , the union said “ Its our great expectation that you would deploy your good office to redress this wrong by ordering the immediate release of our members who are being conspiratorially detained by your officers in Uyo, Akwa Ibom State. May we remind you that under a democratic society, rule of impunity is strongly frowned at”. According to Tarnongu, the crises started when members of the ATSSSAN and NUATE at Akwa Ibom Airport Development Company IADCL embarked on strike to express their grievances about the management’s high h a n d e d n e s s , mismanagement of the airport, unpaid wages and allowances and desperate transfer of 150 specially trained staffers to ministries and departments outside the airport. ATSSSAN further said the management OF IADCL has been displaying unparalleled anti union attitudes adding that a Barrister Idara Etim, the resource administrator in a memo directed that no worker should join any union as the state government has not approved any form of trade unionism while workers already in the union were given February 12 to renounce their membership or face disciplinary action. The union also said the IADCL has planned to spend $34m to train workers to replace those redeployed to ministries saying it was a grand scheme to corruptly mismanage the state tax payers money. C M Y K

38 — Vanguard, MONDAY, JULY 13, 2015

Business & Economy

Hope brightens for improved fuel supply amidst threats STORIES BY EMEKA ANAETO, ECONOMY EDITOR

midst lingering fuel supply dislocations and strike threats there are indications that Nigerian National Petroleum Corporation (NNPC) and a few oil marketers have stepped up importation of the products. About 37 ships most of them laden with petroleum products are expected to arrive Nigerian ports between last weekend and July 25, 2015, according to Nigerian Ports Authority (NPA). The development is not unconnected to a recent meeting between officials of the oil marketers’ association on one had and the NNPC, the ministry of petroleum resources and finance ministry on the other hand.

Meanwhile, the Department of Petroleum Resources (DPR) has claimed that the country’s long running intermittent fuel scarcities are artificial, and the handiwork of unscrupulous oil marketers and depot

President Buhari The meeting, Vanguard learnt, was called by petroleum ministry to broker a deal that would enable uninterrupted supply of the products especially the premium motor spirit (PMS) popularly called fuel, to starve off scarcity and head off any embarrassment to the new government of Mohammadu Buhari, a move one of the oil marketers said was primarily for the effected government officials in the ministries and NNPC to protect their jobs. Vanguard learnt that NNPC was running out of its own supply as the available stock was less than two weeks

consumption volume amidst difficulty in financing adequate stocking. The oil marketers under the umbrella body of Major Oil Marketers Association of Nigeria (MOMAN) and Independent Marketers Association of Nigeria had back-pedalled from importing and supplying the market because of disagreement with the government of ex- president Goodluck Jonathan in its last two weeks in office over the actual subsidy amount owed the marketers by the government. The amount in dispute was N160 billion, as the then

finance minister, Dr. Ngozi Okonjo-Iweala had paid only N130 billion out of N290 billion claims by the oil marketers. Okonjo-Iweala had argued that she could only confirm the principal subsidy amount of N130 billion while the balance N160 billion being the back claims on interest charges on loans obtained by the oil marketeers for the imports as well as the foreign exchange differentials cannot be substantiated immediately, a conclusion that made her set up a committee to verify the claims. The committee did not finish its assignment before the

Foreign Investors express interest in the electricity sector

oreign direct investment into the Nigeria’s power sector got a boost last weekend as Lafarge Africa, a world leader in cement and other industrial goods, said it had applied to Nigerian Electricity Regulatory Commission (NERC) to generate 260 megawatts of electricity to supply to the country’s grid. The application falls under the embedded energy plans of the commission.

Embedded energy is basically extra energy generated by Independent Power Producers who generate power for themselves but have excess they can sell to the market. This is coming at the backdrop of the arrangement in progress by Lafarge Africa, Finland’s Wartsila and the World Bank’s IFC to build a 220 megawatt gas-fired power plant in the country to boost electricity supplies, at a cost

of USD400 million (about N80 billion). The agreement for this project was reached in September last year will help provide electricity to about 1.4 million households. The plan is to add a 220 MW power plant to Lafarge Africa’s existing 90 MW plant, which is used mainly for its cement operations in Nigeria. The existing plant only uses 50 MW and supplies about 40 MW of excess power already,

*Job creation in all sectors, Q1, 2015

therefore once the new plant is built about 260 MW will go to the national grid under a power purchase agreement. According to a Reuters report on this arrangement, Wartsila will build and manage the power plant, while Lafarge Africa will manage the project. The International Finance Corporation (IFC) will provide financial support and advisory services.

government expired on May 28, 2015. The marketers had bid their time to allow the new government settle down before going back to ask for their balance but they refused to be involved in further importation and selling of fuel at the subsidized price of N87 per litre unless the outstanding claims are settled, a development which had made the supply of the products become epileptic across the country with NNPC imports struggling to cope with the situation Vanguard learnt that the committee set up by OkonjoIweala had recommended that the claims were genuine and that the government should honour the obligations, a verdict which the recent meeting between the marketers and NNPC/ ministries of petroleum and finance have also agreed to. Vanguard also learnt that banks have keyed into the new development and have started advancing loans to marketers to finance fresh imports of petroleum products. Meanwhile, the Department of Petroleum Resources (DPR) has claimed that the country’s long running intermittent fuel scarcities are artificial, and the handiwork of unscrupulous oil marketers and depot owners. These groups, according to them are hoarding to create artificial scarcity and then selling petrol at N95 per litre, instead of the approved exdepot price of N77.66, despite getting supplies from the NNPC and also enjoying Petroleum Support Fund (PSF) subsidy. The oil and gas regulatory agency says the marketers are making double gains as they are paid subsidy from the PSF and yet they still arbitrarily increase the ex-depot price of petrol. DPR therefore warns that the licences of offenders would be withdrawn henceforth if they do not desist from such practices, saying the actions of the depot owners who charge a premium of over N17.34 on a litre of petrol, over the officially approved price amounts to defrauding government and the public, since they all get the subsidy for the products they bring into the country.

*New formal jobs in all cadre, Q1, 2015

Vanguard, MONDAY, JULY 13, 2015 — 39

Advertising & Promotions

How NB divides beer market along taste line STORIES BY PRINCEWILL EKWUJURU espite the avalanche of various beer brands in the market, Nigerian Breweries Plc has gone ahead to introduce a new beer brand; Star Triple X, thereby further dividing the taste line of consumers. The company says the beer is brewed with 14 natural extra African herbs of bitter kola, kola nut, ginger etc. The continuous development and introduction of new product (s) is an important source of improvement in consumer (s) welfare and company ’s income. However, the economic question is how much do consumers benefit from new introduction.? Or what competitive effects do new product introduction have.? Generally, consumers are affected by new products in two ways. First, they gain the surplus associated with the additional variety provided by the new product and secondly they develop a new taste bud. In effect, the importance of successful innovation for long-term performance by brands can hardly be overlooked. For this reason, competitors will not remain passive. Observatorily, it’s of fact that two thirds of new product launches meet reaction by competitors after their launch. This could be empirically demonstrated by the strategic launch decisions that managers take. The Activation of the new beer brand from Nigerian Breweries, NB Plc at Polo centre, Enugu by Oracle Experience, an Experiential Agency of the company could be said to be a radical step to enter a market already saturated with beer brands. From what was obtained at the launch the characteristics of the new product launch strategy will have a significant impact on both the occurrence and nature of competitive reactions later. The competitive effect of radically new products and incrementally new products greatly differs. The results will be that competitors will not respond to radical innovations and to new products that employ a niche strategy. Competition however can react if a new product like Star Triple-X can be assessed within an existing product

category. The results may be that competitors will be more inclined to react to the introduction of new products that are supported by extensive communication. This is surely going to happen going by the anticedents of NB, even though likelihood of reaction is higher in high growth markets like the Eastern market. What led to the launch of the new beer, Senior Brand

Manager – Star, NB, Mr. Chidike Oluaoha, said: We are a consumer inspired and a brand led business, at every particular point in time, we go the extra mile to ensure that we provide superior satisfaction to our consumers. And one way we try to do that is to always check with them to know what they want. To know if what they have currently is enough, if there is something extra they would want.

We asked the question in our usual way of checking with our consumers, what more do you want? And that question elicited one answer from them and that answer is, we want Extra! So our consumers told us that they want extra. They love our beer, they love the portfolio of brands that we have because of course Nigerian Breweries Plc is renowned for its portfolio of great brands.

•Consumers sampling the new Star Triple X at the polo centre during the Activation of the new beer from the stable of Nigerian Breweries Plc in Enugu.

Chi reiterates commitment to nutritional benefits

hi Limited, owners of Chivita 100% juice, says it’s committed to meeting the nutritional fruit benefits to consumers. This the company said follows recent report that says about 90 percent of Nigerians are not meeting the recommended daily intake of fruits and vegetables. According to the US Dietary Guidelines Advisory Committee Report for 2005, “Fruit juices provide substantial contributions of several vitamins and minerals in higher amounts than some individual fruits offer’ In an increasingly healthconscious world, many brands have risen to the challenge of meeting consumer needs with innovative solutions. Today, it is gratifying to note that beverage manufacturers like Chi Limited, makers of Chivita 100%, have made it easier for everyone to keep fit, by creating beverages that are simply healthy and affordable. In spite of stiff competition and uncertainties in the marketplace, Chi Limited has endured to build a formidable brand that is a huge delight to fruit juice consumers. According to a renowned nutritionist, Dr. Adeleke Adelakun, “nutrition is a key

enabler to meet almost every development goal for human beings, and we cannot overemphasize the role that natural foods without artificial preservatives and refined sugars can play in achieving this” He further stated that “Chivita 100% fruit juices are

naturally nutritious and are usually fortified with nutrients like vitamin C, calcium and vitamin D. They are considered a “nutrient dense” beverage because they contain far more nutritional value than other beverage choices per calorie”

Marketers eulogise Aimiuwu, late NIMN president

t was an evening of accolades for late Chief Lugard Aimiuwu, former President /Council chairman of the National Institutes of Marketing of Nigeria, NIMN as marketing professionals gathered to bid him farewell at the evening of tributes in his honour. The evening of tribute organized by NIMN as a mark of respect for late Aimiuwu held at the institute’s corporate head office in Shangisha, Lagos, witnessed marketing professionals and other stakeholders from within and outside the nation’s marketing environment pay homage to the memory of the late NIMN boss, who many believed had succeeded in repositioning the institute and enhanced the status of

marketing practice in Nigeria. Among those who wrote a tribute to the late president were ganiyu Koledoye, incumbent president of the institute, Dr. Rotimi Olaniyan, 1st VP, NIMN,Dr. Ify Uraih, Chairman body of fellows, Mrs Ajuibade, Federal Polythenic Ado-Ekiti, Chief Femi Onafowokan, Executive chairman, Ijebu North East LG, Atan ilugun Alaro, Ogun state, Emmanuel Ogbon and the Alumni of Manchester University Business School (2014 set) of NIMN. It will be recalled that Aimiuwu, who was President and Chairman Governing Council of the institute between September 2008 and August 2013, died at the early hours of Friday, April 17, this year at 68.

TNS, GeoPoll partner on market research

he management of TNS and GeoPoll recently announced a partnership that would allow them provide market research information to companies across Africa via the mobile platform. The partnership according to both companies will be driving an innovation which comes with benefits that outweighs that of traditional techniques. Speaking on the partnership at a media parley in Lagos, Managing Director TNS, Thomas Walker explained that the partnership is coming at a time when the industry is changing and the traditional techniques are no longer in vogue. “Mobile platform as a new way for market research unlock new doors and possibilities for us as an industry and our clients. With the rapid market competition, forces and dynamism, companies must also evolve. Most consumers cannot recollect what they did last week but now, we ask you what are you doing at the moment and that’s what our clients want to know.

S-Africa wine tasting exhibition returns to Nigeria

here are indications that the South African Grand wine tasting exhibition is returning to Nigeria. This event which coincides with the Nelson Mandela Day is celebrated around the globe. The one day event is opened to 18years plus, and designed to showcase quality wines from over 25 wine producers and over 200 wine brands from different regions in the Cape Wineland of South Africa. Guests are expected to trade, taste and attend the exclusive South Africa Wine course, which shall be pre-registered. The wine course will be led by Wine Advisor, Brad Coetzer, from renowned education company, Beverage Intelligence. The course is however opened to only Trade businesses such as importers, distributors, hotels F&B Managers, retailers, portfolio managers, gourmet and brand reporters and general food and beverage service providers. The annual event is now established as a platform that delivers an up-market audience in a very prestigious environment. C M Y K

40 — Vanguard, MONDAY, JULY 13, 2015 Email:lesleba@lesleba.com, lesleba@gmail.com Blog page:www.lesleba.com/blog2 Website: www.lesleba.com Tel:0805 220 1997

scathing assessment of the CBN’s strategy for reducing the increasing demand pressure on the Naira was recently published by “The Economist,” which is a UK based internationally respected magazine. ‘The Economist’ in its report titled “Nigeria’s Currency: ToothPick Alert” has clearly drawn the ire of the management of the Central Bank of Nigeria. Even if, CBN dismisses the title of the report as harmless satire, the author clearly pulled no punches in its scornful portrayal of the interventions of our Apex Bank in the foreign exchange market as akin to that of a bungling clown. The anonymous author, for example, describes the process which determined the 40 imported items, which were recently excluded from access to official foreign exchange, as “if the hit list was drawn up by someone wandering around a home and a building site and randomly pointing at items”. The story further embellished the image of CBN as a comic delight, when it inexplicably gives prominence to Indian incense, toothpicks, as some of the banned items, while forex prohibition for rice and tinned fish importation, which consume more forex appear as an addendum to the less basic items earlier listed. Nonetheless, the report, considers the official forex ban on tinned fish and rice as a counterproductive measure “for a country that does not produce enough of these things to feed itself, but no matter ”, the anonymous author cynically noted “Nigeria must be shielded from foreign sardines”! The writer’s choice of sardines and toothpicks as its perceived spearhead of threats to Nigeria’s security is probably an attempt to ridicule the futility of CBN’s exclusion of those forty items from official

forex sources. Furthermore, the author, with an air of presumed superior wisdom, also warns with apparent altruism, that CBN’s attempt to “puff up the Naira’s exchange rate could cause untold harm to Nigeria’s economy ”, as “Emefiele’s policy would (inadvertently) precipitate higher inflation and further weaken the Naira”. The report’s coup de grace, however, is the brazen condemnation of Emefiele’s managerial incompetence when compared with the performance of the former CBN Governor, Lamido Sanusi, who according to the writer, “ was the toast of overseas investors until he was sacked for exposing corruption by Jonathan’s government”. The author of “Toothpick Alert”, is consequently perplexed at Nigeria’s odd preference, since according to him “if investors (overseas) do not have confidence in Emefiele as successor, which, would have been the worse option for Nigeria: allowing erstwhile Governor Sanusi to serve another four years or undermining the independence of the Central Bank by sacking him”. Inspite of the clearly rambling unedited colloquial presentation of the story, the no holds barred, frontal attack may inform that the author possibly has an axe to grind with Emefiele as CBN Governor. Alternatively, the author may know next to nothing of the structure or the primary drivers and brakes in the Nigerian economy. What is clear from ‘The Economist’ story, however, is the overriding message that investors want more Naira

depreciation, so that speculative overseas investors can readily expand their portfolio of Nigeria’s listed equity for less dollar values. In pursuit of this objective, “The Economist” is ‘ righteously ’ alarmed that ‘instead of allowing the Naira to devalue” (the writer probably means depreciate as a currency does not unilaterally devalue itself) “the Central Bank is trying to defend the Naira rate by blocking imports”. The author ’s superficial understanding of the cause of the Naira’s unending depreciation is possibly an indication that he or she is clearly oblivious of the devastating impact and cause of the poison called “Excess Liquidity” on the Nigerian Economy. Evidently, our seemingly

It is deceit for anyone to claim that the current low price of crude oil is directly responsible for a weaker Naira

Business & Economy Nigeria targets 20% supply of local petrol demand

igeria aims to overcome its current refining sector problems in order to produce at least a fraction of the gasoline it needs to use itself. NNPC said it hopes that domestic plants can cover 20 percent of Nigeria’s petrol needs. President Muhammadu Buhari, who oversaw much of the refining system’s development, is keen to reduce reliance on costly subsidised imports. Ian Udoh, Group Executive Director of Refining and Petrochemicals, NNPC, said C M Y K

strategy of the Apex bank to prop up Naira exchange rate. Surely, the strategy of restricting scarce forex reserves to a nation’s relatively critical needs, which ‘The Economist’ scorned, has infact proved successful in several countries in encouraging local production and import substitution which also promotes increasing employment opportunities. The preceding narrative should not for one minute suggest that CBN is on track with regard to appropriate Naira pricing. Clearly, so long as the enabling indices of CBN’s monetary instruments (inflation, cost of funds and exchange rate) remain out of gear, the exclusion of forex for rice and other intermediate raw materials will certainly trigger a general price rise, and also widen the gap between the black market and the official Naira exchange rate, to ultimately make the content of ‘Toothpick Alert’ a prophetic report. Nonetheless, this need not be so if CBN finally accepts that our exchange rate dilemma will not be resolved by mere lip service to the role of demand and supply as the critical determinants of the constant intense pressure on the Naira exchange rate. Indeed, so long as the disenabling burden of untamed Naira surplus remains our habit, not even hundreds of billions of forex reserves will stop a cascading tumble of the Naira exchange rate and the attendant disastrous consequences for our economy and our social welfare. Sooner than later, the CBN will have to admit that the monthly substitution of Naira allocations for dollar denominated revenue remains the major threat to the Naira exchange rate and our national security. SAVE THE NAIRA, SAVE NIGERIANS

‘The Economist’ and CBN’S “toothpick alert”

that he expected to receive six cargoes a month of Nigerian Bonny Light and Escravos crude oil to run 180,000 barrels per day (bpd) or 40 percent of Nigeria’s total refining capacity. He expected to produce 8 million litres a day of gasoline, accounting for about 20 percent of Nigeria’s estimated consumption. During the last eight months, no crude was sent to the refineries, said the company contracted to deliver the oil. A government document also

showed that the deliveries stopped last year but a month earlier, in October. Nigeria has wholly depended on subsidised fuel imports and crude-for-product swap agreements and suffered acute fuel shortages in May. The government’s anticorruption and security services are investigating the intricate structure of oil swaps deals. The crude in those contracts is taken out of the domestic allocation. Due to the dilapidation of pipeline infrastructure, refineries depend on sea deliveries.

unyielding burden of excess Naira supply is clearly responsible for the steady slide in the rate of our national currency; nonetheless, over an understanding of this primary causative factor of Naira depreciation would clearly still be discounted as useless input, so long as the actual object of ‘the Economist’ story is to robustly serve the interest of “blood thirsty” external sponsors and speculators who want to make whoopee on the back of a battered Naira, notwithstanding the deepening poverty and social dislocation that come with Naira devaluation and forex inflows which seek short term bonanza profits from the Nigerian securities market. It is deceit for anyone to claim that the current low price of crude oil is directly responsible for a weaker Naira. Indeed, if such relationship is true, then the converse must also be valid; in other words, if crude prices should rise above $100/barrel, Nigeria will earn more revenue and the Naira should be stronger; but surprise surprise, how come no such major appreciation occurred in the Naira exchange rate, when crude oil price exceeded $140/barrel with regular output of well above 2million bpd, while Nigeria’s so called forex reserves exceeded $60bn. Sadly, however, even if the language of ‘Toothpick Alert’ was mundane, with an analysis that lacked depth, CBN’s rejoinder in several full page advertorials was unnecessarily effusive and self depreciating response against a clearly cynical attempt to deliberately ridicule the efforts and

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