CBN creates 6m jobs through intervention funding

MARCH 28, 2016

CBN creates 6m jobs through intervention funding

Calls for Emefiele's removal is trivialising Nigeria's problems Nigerians should look inward The data further showed that the CBN Agricultural Credit Guarantee Scheme Forex availability is beyond CBN that was set up in 1978 with N3million

BY OMOH GABRIEL, NKIRUKA NOROM & LAWANI MIKAIRU

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some sectors. Going by the data sighted by Vanguard, in 2009, the bank through its Commercial Agriculture Credit Scheme set up N200 billion intervention fund. As of today, a total of N337.635 billion was disbursed and a total of N137.804 has been repaid.

The fund financed a total of 423 projects and generated a total of 1, 132, 232 jobs and saved the investors interest payment of N42.564 billion.

as seed money disbursed a total of N97.014 billion out of which N67.014 billion was repaid. The intervention granted loan facility of 1,009,180 and has so far generated a total of 5,045,900 jobs.

The CBN evaluation data showed that the Small, Medium Enterprise Credit Guarantee Scheme set up by the apex bank in 2010 had as its seed money the sum of N300 billion. So far, N4.219 billion has been disbursed

HE Central Bank of Nigeria (CBN), has generated no less than six million jobs through intervention funding since 2009, even as many Nigerians have expressed shock over calls for the sack of the CBN Governor, Mr. Godwin Emefiele because of the bank’s monetary policies. They say the bank has done well and should be commended instead of being lampooned.

Presidency sources said that from the evaluation of the apex bank's intervention in the economy since 2009 has created a total of 6,000,000 jobs through its developmental finance initiatives.

Figures sighted by Financial Vanguard from the Presidency evaluation data showed that the CBN set up eight intervention funds of N1.57 trillion out of which economic operators have accessed N819.164 VISIT: From left: Acting Managing Director\CEO, Mr Waheed Olagunju; Chairman, FirstBank billion to resuscitate Plc, Mrs Ibukun Awosika, and Executive Director, Corporate Services, Bank of Industry, Mr their businesses that Jonathan Tobin during a courtesy visit by Mrs Awosika to BOI in Lagos has helped to sustain C M Y K

while 2.439 billion has been repaid.

The intervention fund financed 87 projects. The data also showed that the apex bank set up in 2014 the RSSF facility of N300 billion, out of which N3.5 billion has been disbursed for a single project. Also in 2010, the apex bank set up the Power and Aviation Intervention fund of N300 billion. So far, a total of N255 billion has been disbursed and N69.755 billion repaid. The fund has financed 56 projects.

The bank they said has three other funding for which about N450 billion was set aside and several projects have benefited from the intervention funding. The Presidency official wondered why Nigerians can not understand what the apex bank is trying to do for the nation. He said that instead of looking for scapegoats, Nigerians should face reality and learn to do what is right.

The Director General Lagos Chamber of Commerce and Industry Mr. Muda Yusuf believe that the call for the removal of Emefiele as CBN governor is trivialising a very serious matter. He said "The issue is not whether to remove him or not but how to address the policy in place that will give private sector operators a level playing ground. To the private sector, reviewing the policy on ground is what matters. Some of the issues facing the nation today were not created by the Governor.” He said what the average business man is concerned with is how to access foreign exchange to conduct his business. He said exporters also would like to see the proper use of the proceeds of their exports.

Mr. Emeka Ugwu-Oju, President of South-East South-South Professionals of Nigeria said he would hold his comment on the issue until after the body’s visit to the Vice-President on Thursday to discuss issues about the regions with him. He said there after, the body will visit the CBN to hear from them before making a statement. He said his body will not like to make statements based on sentiments.

Exchange rate challenge beyond him, though monetary policy flawed – Investment banker Continues on page 18

18 — Vanguard, MONDAY, MARCH 28, 2016

Cover

How to get funds for your business Turning great Ideas into great money ave a great business idea is only the first step in the journey to raising your business empire.

Turning your business idea into a money- making venture requires raising the capital necessary to get your blessing running and that represents the next step of thousands of other steps. In starting your own business, the most challenging task you have to face as an entrepreneur is raising money as capital.

The ability to raise money to start a business is one of the tests you must undergo as an entrepreneur. As daunting as it may seem, the challenge of raising money is not as tough as you think. It is no secret that in your quest to raise money to start your business you are bound to face a lot of obstacles.

It would be very unfair of me to promise you otherwise.

However, the good news is that it can be done as there are some people, some institutions and some organisations willing to look at investing in start – up businesses.

There are many tried and tested ways of raising money to start your business which have been used by many famous entrepreneurs whose businesses have become household names, including Bill Gates (Microsoft), Michael Dell (Dell computers) and Richard Branson (Virgin), to name a few.

For maximum success, you would do well to use a combination of different tactics to employ when you want to raise capital for your great business idea.

Using feasibility business Ideas The first and basic key to raising money is to have a business idea that is feasible, that is practicable, and that is workable.

You wonder why? The first question any investor you approach will ask is this: How profitable is your business idea? That is because no investor will want to put his money in a business that is impossible and not viable. They will also want to know the expected return on their investment and the time frame within which to recoup their initial investment. Before you embark on a quest to raise money, carry out a feasibility study to determine the profitability of your business idea.

Using a business plan Another prerequisite in the process of raising money for your business idea is a good business plan. One of your first moves when you want to source for funds to start your business should be to put a comprehensive business plan.

Your business plan will include details of your background, education, training experience and any other personal qualities you possess. Your personal qualities and experience are often regarded as assets to your business. Your business plan should also explain in detail the modalities of how you are going to use the money you need.

It should also explain in detail your proposed business idea, associated expenditure, the market research undertaken, and your financial projection and so on. Above all, your business plan should describe in detail what makes your business differs from that of your competitors. What will interest your investors the most about your business plan should state precisely what any investor should expect as returns on their investments and also, when and how you are going to pay it.

Personality, Appearance and presentation style Next thing to consider is your personality, your appearance and your presentation style. When approaching an investor, remember you have only a chance to create an impression in his or her mind.Therefore,you must be conscious of your appearance, don’t appear rough and unkempt and, please, try to look professional. In the game of raising money for your business, appearance matters a lot.

Now to your presentation style: your manner of presentation will determine the success or failure of your quest to raise money for your business idea to your investors with a high level of confidence, because the better you are at communicating your strengths to them, the better your chances of raising money. If you lack communication skills, read up books on the topic.

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VISIT - From left, Ooni of Ife, His Majesty, Oba Adeyeye Enitan Ogunwusi, Ojaja II; wife of the Founder of FCMB Group, Olori Abimbola Balogun; wife of the Ooni of Ife, Olori Wuraola Ogunwusi and Founder of FCMB Group and Olori Omo-Oba Akile Ijebu, Otunba Michael Olasubomi Balogun, during a courtesy visit by the Ooni to the Founder of FCMB Group at his residence in Lagos on March 21, 2016 in Lagos.

CBN creates 6m jobs through intervention funding Continued from page 17

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n investment banker who prefers anonymity said his monetary policy is flawed, but insisted that stabilising the naira is beyond the CBN governor. “On the monetary policy, there are inconsistencies because the assumptions on which they take decision are at variance with decisions they take. So, on that, you could see some flaws, some inconsistencies, but in terms of the exchange rate, it is beyond him because the President has taken a position and anything on the contrary will mean direct confrontation with the president,” he said.

“The key thing is that the position of the President has jeopardised any other position and has constrained the MPC from taking any liberal decision. Generally, in terms of exchange rate, it is beyond the CBN governor, but in terms of monetary policy, there are inconsistencies because the premise on which they take certain decisions seem to be at variance with underlying factors that should be the driving factors for economic growth in Nigeria today.”

Call for CBN governor’s removal uncalled for — Stockbrokers

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ommenting, Alhaji Ola Yussuff, Managing Director, Trust Yield Securities Limited, said: “It is uncalled for. I don’t think you have to remove the CBN governor simply because he is pursuing certain policies. People forget that there is what is called

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autonomy; CBN is an autonomous institution and the role of any CBN governor is to ensure that the monetary policy of this country is run on independent autonomous basis. CBN governor is not necessarily reporting to the president; he is to look at the economic policy of the country and adjust the monetary policy as he feels like, that’s why you have the committee.

“The question of removing or not removing the governor is political. You don’t do such thing. The worst you can do is to wait for his tenure to expire and not renew it. His removal will send a wrong signal because we cannot be disrupting things like that.”

Continuing, he said: “The fall in Naira has nothing to do with the CBN governor. The fall in Naira is a reflection of fall in foreign exchange earnings from the oil receipt.

We are not earning as much money as we used to earn from oil; that is why the Naira is falling.

“It has nothing to do with the CBN governor; there is no magic he can perform on that.

People needed to be educated.

Your currency is a reflection of how strong your economy is and our economy is weak because we depended all along on petroleum money and that petroleum money is no longer there. The little there was taken away by politicians. So, we don’t have money.

“So, how can your currency be strong? You don’t have reserve; your reserve is gone.

The revenue you are earning from oil is declining and that is what the currency is reflecting.

"So, it has nothing to do with the CBN governor, it has to do with the fundamental of our economy. The fundamental is

that we are not producing; we are not generating money. The oil we are using to generate money is no longer selling; it is selling below the price it used to and we have been printing money all along.

“So, if we don’t have foreign currency to bring what we need now, then you have to use your local currency and if your local currency is chasing very limited amount of goods, then prices will be going up.

That is what is causing inflation.”

He noted that the challenge for the nation is to go back and ‘produce everything we need ourselves; that is when we will get it right. If you like, change your CBN governor every day; it is not going to change anything. There is no magic anybody can perform.’

In his own reaction, Mr. Emeka Mmadubuike, Chairman, Association of Stockbroking Houses of Nigeria (ASHON), said: “Given where the economy is, this is the worst time to remove anybody. People need to come up with more useful suggestions as to what needs to happen and it must be useful and tactical. We are facing multi-dimensional problems and so there is no one-size-fit-all solution because we are coming out from a situation where there was no control; there was no discipline. Added to that, we have a situation where we are facing very serious challenge on the price of oil, which is beyond anybody’s control.

“For me, given all the factors that we face, now is not the right time to remove anybody, rather we need to put heads together and find useful and practical solutions out of the problem.”

He continued: “I don’t think Continues on page 19

Vanguard, MONDAY, MARCH 28, 2016 — 19

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he National Assembly last Wednesday passed the 2016 budget for the President to sign into law. After the President’s endorsement, it will become mandatory for the Federal Government to implement to the letter, the provisions of the budget. Now there is an economic guideline by which the administration of Buhari can be assessed. The 2016 budget has very far reaching implication for the economy if not properly managed.

The budget has good intentions but it has the potency of causing industrial unrest as it certainly will trigger off a general rise in the prices of goods and services in the economy during the year.

The first major problem in the budget as passed is that members of the National Assembly confess that the passed budget is ridden with errors. The errors may be the undoing of the budget. The Chairman, Senate Committee on Appropriation, Danjuma Goje while presenting the budget admitted that there were still certain lapses in the budget which had not been taken care of. He said that the committee had to let the lapses go because any attempt to correct them would mean that the budget would stay longer before being passed and that Nigerians would not understand.

Does it mean that the padding of the budget was allowed to go? Why then the fuse about budget padding. It would mean that the National Assembly failed in its duty to the nation by passing a budget that has loopholes for the executive and civil servants to exploit.

A cursory look at the provisions of the budget showed that the National Assembly specifically reduced the total budget sum from N6.07 trillion to N6.06 trillion.

In the budget, N351 billion is for statutory transfers, N1.4 trillion for debt service, N2.6 trillion for recurrent expenditure, and N1.5 trillion as capital expenditure.

Inflation, No 1 enemy of Nigerians in 2016 The N17 billion reduction in the aggregate expenditure of the budget was taken from overhead votes component of the N2.65trillion recurrent expenditure of the budget which has now been reduced to N2.646 trillion From the N351.370 approved for statutory transfers, National Assembly gets N115 billion; Universal Basic Education gets N77.110 billion; National Judicial Council gets N70 billion; INEC gets N45 billion; Niger-Delta Development Commission gets N41.050 billion; Public Complaint Commission gets N2 billion while National Human Rights Commission gets N1.210 billion.

These provisions are in the main for investment in infrastructure, payment of salaries and wages, pensions and debt service. They are not expenditure in the real sectors of the economy that will increase the availability of goods and services in the short to medium term.

Looking at the budget, bulk of the provision is for consumption spending essentially. The fundamental question to ask is: does the economy have the absorptive capacity to take the volume of money to be released without

upsetting prices of goods and services in the market place?

Certainly the government has made it clear that it is going to reflate the economy.

By investing in infrastructure and paying contractors, many Nigerians working in that sector will be re-engaged and called back to work. The spending will put money in the hands of Nigerians who will find work. They will certainly want to buy goods and services with the money they earn. This ordinarily should be the incentive for manufacturers and service providers to produce more.

It could lead industries and other service providers to

By investing in infrastructure and paying contractors, many Nigerians working in that sector will be reengaged and called back to work

increase capacity and employ more hands. This of course is bound to reduce the level of unemployment if all things work well.

But in the immediate and short run, investment in industries and the expansion of the existing ones may take a while. While companies that have inventories of finished goods are in a good stead to sell off, there comes a period when their stock of finished inventory get exhausted and are not able to produce to meet the current demand from households. This is as a result of the fact that disposable income in the hands of Nigerian consumers would have risen.

This situation will give rise to a general increase in the prices of goods and services because the supply chain is limited. Already, the nation is facing foreign exchange crunch and may not be in a good position to provide the needed foreign exchange cover to import the needed goods. This will trigger cost push inflation as companies will produce at higher cost and pass the cost to the consumer. Nigeria at the moment, is facing imported inflation. This will have direct effect on the cost of living of

the average Nigerian.

The National Bureau of Statistics has said that inflation is now 11.4 per cent. It has moved from a single digit to two digits before the passage of the budget. Certainly, when government begins to release funds into the various projects it intends to embark upon in the course of the year, inflation will further go up. The level of inflation the country will contend with during the year will depend on the decision of the spending ministries and their understanding of the inverse relationship between unemployment and inflation.

If the government, as it intends to do, chooses to go for a drastic reduction in unemployment in the country at the present state of the economy, it must realise that it will have to increase spending.

Increased spending means more money in circulation that is more than the goods and services that are available. This can only lead to a situation where more money chases few goods. The 2016 spending plan of the Federal Government will require fiscal discipline by adhering to planned release of funds into the economy and a very close collaboration with the Central Bank of Nigeria to tame inflation. By this budget plan, 2016 may be difficult for fixed income earners and pensioners among others. It may be a year Nigeria will once again witness agitation for review of wages by labour.

Cover Story Continued from page 18 it is a problem that will go away over night; it is going to take a while given the factors that are confronting the nation.

There is nobody you bring now that has the magic wand. Now is the time people need to sit together and work together, provided we have sincerity of purpose. That is what has been lacking.

“We need to do away with people who are wherever just for their own selfish interest, because if you have a country that has continuous leakage in such a massive proportion, it doesn’t matter who you bring. Even if you get the World Bank President to be your CBN governor, nothing will change. That is the truth.”

Mmadubuike stated that there is need for Nigerians to change their appetite for imported items to made-in-

CBN creates 6m jobs through intervention funding Nigeria goods, saying that the government should take the lead ‘so that we can preserve the little foreign exchange that we earn.’

“If we continue to have this ostentatious appetite of exotic things; when people want to do little thing, they want to go to Dubai and Lebanon; we need to begin to change all that and government has to lead in that process. That is the real change that we need. There has to be a paradigm shift in the way we think. So, removing the CBN governor will not solve any problem,” he said.

Some of the passengers interviewed by Vanguard at the Murtala Muhammed Airport, Lagos argued against the removal of the apex bank boss. Mr. James Oba passenger at Muritala Mohammed airport reacting to

the call stressed that he did not see any tangible reason that would warrant the sack of the CBN governor. Oba, who claimed that he works in one of the banks in the country said that as far as he was concerned, the CBN governor is trying to improve local production of goods and services in the country as against foreign importation which had been a catalyst for the call for further devaluation of the naira.

According to him, CBN maintains the official rate of N197 to a dollar ($1) and noted that because most businessmen could not get it, they resort to buying it from the black market at such exorbitant price at N320 to $1 which is quite higher than the official CBN rate. He argued that

the importation of goods by these businessmen at such rate was responsible for crashing the value of the naira as well as the possible cause of inflation. Oba also said “Nigeria is a monoproduct economy that solely depends on oil. In Nigeria, we import more than we do export. As you know, the price of crude oil has fallen and it is affecting our currency because our foreign reserve has dropped drastically.”

“I think what the CBN Governor is trying to do is to put up a policy that will boost local production. If most of the importers can’t buy goods outside the country at such high rate of the dollar, they will be forced to look in-ward and begin to produce such

goods locally and this will be better for the country”.

Another respondent, Mallam Isa Bello, told Vanguard that Emefiele should be allowed to complete his tenure. According to him, “His policies are good, with his forex policy, I think he is trying to diversify the economy and make Nigeria move from oil to other areas like agriculture, tourism amongst others” Bello affirmed.

Earlier, the overseer of The Latter Rain Assembly, Lagos, Pastor Tunde Bakare, had called for the sack of Mr. Emefiele following the alleged role the bank played in the $2billion arms deal.

However, Edo State Governor, Comrade Adams Oshiomhole accused those advocating for his sack as saboteurs of the Nigerian economy.

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20 — Vanguard, MONDAY, MARCH 28, 2016

Business & Economy

CUMMINS: Expanding to provide power solution

By Etop Ekanem

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aking a look at today’s challenging business environment, a wide range of power companies are constantly striving to enhance reliability, profitability and efficiency, while trying to improve overall environmental performance and compliance. Cummins leads the line in the Nigerian power generation ecosystem with their range of products tailored towards the needs of several business groups.

The importance of power as a sub sector of the energy industry of a country can never be overemphasized, as power is significant to the development of different aspects of the economy. As a matter of fact, infrastructural advancements form the crux of both technological and human capital development; all of which translates into the roots, stem and leaf system that help to grow the economy of a country.

It is the realization of these facts that Cummins West Africa Limited is proffering power solutions to tackle one of the major challenges faced by many African

ITPC plans exhibition to draw Indonesian investors to Nigeria

BY JOSEPHINE AGBONKHESE

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range and Ecobank launch a bank-to-wallet money transfer service This partnership, which is already operational in Mali since January 2015 and in Cameroun since August 2015, facilitates money transfers for both Ecobank in partnership with Orange has launched bank to wallet transfer service. The Partnership allows customers top-up their Orange Money e-wallet from their bank account, and vice versa.

Customers can use their mobile phones to securely transfer money between accounts at any time, without the need to go to a distribution point or to have any physical cash. Ecobank customers can also view bank account balance and obtain mini-statements by SMS via the service.

By enabling customers to link their bank account with their Orange Money account, this new service in Côte d’Ivoire, Guinea Conakry and Niger furthers the development of mobile financial services in Africa.

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NEXIM Bank, Shippers Council plan trans-regional shipping line

BY GODFREY BIVBERE

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he Nigerian Export – Import Bank, NEXIM and the Nigerian Shippers Council, NSC, are collaborating to establish a shipping line for trading within the West and Central Africa sub-region.

The establishment of the trans-regional shipping line was disclosed by the Acting Managing Director of the NEXIM Bank, Mr. Bashir Wali at the just concluded “Transport cost and regional connectivity of African countries.”

Wali, who was represented by his Technical Adviser, Hope Yongo, said that they decided to venture in the regional as a result of high transportation costs and excessive transit time that makes intra-regional trade non-competitive and West African transport and logistics costs one of the highest in the World.

The NEXIM boss also bemoaned the absence of dedicated safe and modern fleet to encourage and facilitate Atlantic Short-Sea Trade along the West and Central African regions as well as inadequate transport infrastructure among member states and non tariff measures that are a barrier to: Increase intra-regional trade; Regional integration; and free

movement of persons and services.

He said that the Regional Sealink Consortium is broadly proposing, an integrated maritime/ logistics services– combined transport, warehousing facilities with supporting ancillary services– Container handling and weighing and deepening coastal maritime activities and inland waterways with high prospects of promoting tramp services and open avenues to promote ferry services.

Furthermore, enhancing bulk cargo trade and

provision of a dedicated platform for port operationsat Burutu Port to mining activities and Messrs.

Marine Services & Supply Co. Ltds of the Regional Sealink Consortium has now confirmed willingness to deploy three ships for the pilot scheme operation of the regional Sealink project upon confirmation of Notice of Readiness (NOR) from Sealink Promotional Co. Ltd. Yongo further noted that while intra-regional trade in European Union, the North American Free Trade Agreement, NAFTA and the

Association of Southeast Asian Nations, ASEAN, stood at about 60 percent, 50 percent and 30 percent compared to about 15 percent and 12 percent for African and ECOWAS trade respectively.

He frowned at the growth in intra-ECOWAS trade in the past decade from 4.7 million tons to 13.2 million tones without corresponding increase in transport infrastructure and the low level of African container traffic that stood at less than 1 percent of total world container traffic of over 400 million containers.

PRESENTATION: From left, Mrs. Ebehijie Momoh, Head, Retail Banking, Standard Chartered Bank Nigeria; Mr. Nofiu Abidemi; Ms. Chioma Nadia Iwuchukwu; Mr. Irele Philip, all winners of iPhone 6 mobile phones and Mrs. Dayo Aderugbo, Head, Corporate Affairs, Brand & Marketing, Nigeria & West Africa, Standard Chartered Bank Nigeria at the Grand sale campaign presentation ceremony in Lagos.

Customs agents petition Buhari over collection of truck registration fee by NPA

BY GODWIN ORITSE

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HE National Council of Managing Directors of Licensed Customs Agents, (NCMDLCA) has said that the truck registration fee presently being collected from truck owners by the management of the Nigerian Ports Authority, (NPA), is illegal and against the concession agreement.

The group’s president, Mr. Lucky Amiwero said that the truck registration by the port authority amounts to double payment as the fee has been paid along with other charges.

He explained that before a truck goes into the port to load a container, it must pay what is called Vehicle Entry Permit fee adding the fee being collected for registration was unnecessary.

In a petition to President Muhammedu Buhari,

Amiwero said that what NPA is collecting as Truck Registration Fee has been paid for by importer adding that the money is also part of the operational rate contained in the lease agreement.

He explained that the

operational rates of the lease agreement to Terminal operators include rate for cargo due and Delivery Charges, adding that while the charges are paid by the consignee the cargo dues are paid in Dollars, delivery

charges are in Naira.

In a petition to President Muhammedu Buhari, Amiwero said that what NPA is collecting as Truck Registration Fee has been paid for by importer adding that the money is also part of the operational rate contained in the lease agreement.

No price increase, says Multichoice

BY PRINCEWILL EKWUJURU

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ultichoice owners of the Digital Satellite Television, DSTV platform says it’s not increasing prices on its bouquets.

According to the Managing Director for MultiChoice Nigeria, John Ugbe, “We are extremely pleased to announce that there will be no price increase on DStv subscriptions this April on

any of the bouquets. Barring any further external economic shocks, we do not anticipate a price increase in 2016. This means that from next month, DStv subscribers can fully immerse themselves in the exciting world of DStv entertainment, at no extra cost.”

“It’s been a tough year for Multichoice Nigeria. Our markets have suffered as a result of commodity and oil price weakness, coupled with the huge devaluations of local currencies.

Most of MultiChoice’s costs are

incurred in dollars forcing us to pass through price increases in 2015.

Nevertheless, we continue to take financial strain.”

Continuing, “ we are not alone. Our subscribers, our biggest asset, are suffering.

So we are going to do our bit. We’ve decided to absorb some of the pain and not impose a price increase on any of our DStv bouquets in April as we usually do.

Barring any further external economic shocks, we do not anticipate a price increase in 2016.”

Vanguard, MONDAY, MARCH 28, 2016 — 21

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22 — Vanguard, MONDAY, MARCH 28, 2016

Banking & Finance

Ecobank enhances card services with instant personalized cards

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cobank Nigeria Limited has upgraded its instant debit card issuance process, enabling walk-in customers get their personalized cards at over 370 Ecobank Nigeria branches within few minutes.

The Ecobank Instant Debit Card is naira-denominated and gives the cardholders 24/ 7 access to funds in their naira accounts from any part of the world.

Announcing this innovative service in Lagos, Head, Cards and eBanking, Ecobank Nigeria, Ayotunde Kuponiyi said with the naira denominated card, holders can access their funds and transact business in any part of the world with more ease.

He noted that the personalized debit card is easy to obtain, “The Ecobank Instant Debit Card is produced in-branch and with customer ’s details. The card can also be activated by the customer on an in-branch POS terminal immediately he/shecollects it. Customer can therefore walk out of the branch with a functional card within few minutes. “

Firstmonie introduces Talk360 international calling app

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irstmonie, the mobile money platform for First Bank of Nigeria Limited, has partnered with MMIT (Mobile Media Info Tech) to introduce international calling app Talk360 to Firstmonie mobile wallet users and Nigerian consumers.

This partnership gives consumers the ability to pay for low cost international calls through the Talk 360 calling app with their Firstmonie mobile wallets. This mobile wallet capability is the first of its kind in the competitive Nigerian mobile money and payment landscape. Talk360’s high quality service allows the user to save up to 90% on call costs to mobiles and landlines around the world without the need for a contract or SIM. The app can be downloaded for free via the Apple App Store, the Amazon App Store and the Google Play Store and comes with a free trial to call anywhere in the world.

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Banks record N649bn bad loans in 8 banks exceed 5% regulatory limit 2015 STORIES BY BABAJIDE KOMOLAFE

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he amount of bad loans in the banking industry rose sharply by 78.8 percent to N649.63 billion in 2015, indicating severe deterioration in the quality of the loan portfolio of the 22 banks.

This was contained in a Central Bank of Nigeria (CBN) Staff report presented to the Monetary Policy Committee (MPC).

The report revealed general increase in bad loans (non performing loans) among the 22 Deposit Money Banks in the country. This was despite 30 percent decline in new loans granted by banks in 2015 to N5.78 trillion.

According to the report, 18 out the 22 banks recorded increase in bad loans.

Furthermore, the number of banks that exceeded the regulatory limit of five percent for ratio of bad loans to total loans rose from three in 2014 to eight in 2015, with three banks exceeding 10 percent.

The report reveal that the ratio of bad loans for the industry relative to total loans rose to 4.88 percent, which is 1.2 percent less than the regulatory limit of 5.0 percent industry.

AGM - From Left: Solomon Ikeanyi, Publicity Secretary; Abiodun Adebimpe, General Secretary; Kemi Adewole, outgoing President; Taiwo Sonola, acting President; and Lanre Akinsete, Treasurer; all of Association of Asset Custodians of Nigeria at the association’s AGM in Lagos.

The sharp increase in bad loans, according to the report was due to a host of external and internal factors. These include: Low and volatile Oil prices; uncertainty about severe fiscal imbalance at the sub-national level of government; weak output growth; and eroding investor confidence.

The Monetary Policy Committee (MPC) of the

CBN at its meeting held last week had expressed concern over the reluctance of banks to lend to the private sector due to the sharp increase in bad loans in the industry.

According to the Committee, this apathy contributed to the slow growth of the economy in 2015 and also to the build up of excess cash (liquidity) in the banking system.

Coronation Merchant Bank's profitability doubles to N3.22bn

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oronation Merchant Bank has recorded a 100 percent growth in its profit after tax which grew to N3.22 billion for the financial year st ended December 31 2016.

This followed a 43.7 percent increase in the bank’s Profit before tax (PBT) which grew to N2.33 billion in 2015 from N1.62 billion in 2014.

The results indicated that Coronation Merchant bank, which was formerly Associated Discount House, was able to sustain its tradition of impressive results.

The Bank’s results, which is the first to be announced in the banking industry for 2015 financial year, reflects accountability, transparency and a culture of responsibility which are the defining attributes of the Coronation Merchant Bank brand.

The sharp increase in profitability was occasioned by superlative improvement in the bank’s revenue generation

capacity as a result of increased efficiency in its funding mix. Net-interest income rose from N2.21 billion in 2014 to N3.07 billion in 2015, just as non-interest income increased by 83.3 percent, from N.70 billion in 2014 to N1.29 billion in 2015, to illustrate the effectiveness of its business strategy and operational model.

Total assets rose to N78.24 billion from N74.64 billion in 2014, and shareholders fund increased to N20.24 billion from N16.53 billion, which is a valid testament to the competitiveness of the bank’s operations and its adaptability to market realities.

An emerging merchant banking franchise with 77.3 billion capital adequacy ratio above the regulatory minimum, Coronation Merchant Bank is driven by the vision of becoming Africa’s premier investment Bank.

Consequently, its expertise in corporate banking, investment banking, private banking, assets management and securities trading have been efficiently strengthened with the appointment of credible individuals with vast international and local experience to deliver exceptional benefits to clients and other stakeholders.

With a strong risk rating of ‘A-‘ by Agusto and asset base of over N78bn, The Bank is certain to leverage its privileged supervision by some of Nigeria’s individuals who excelled and rose to the top of merchant banking sector at its height of excellence to become the industry model for risk management, corporate governance and responsible business practices.

Coronation Merchant Bank is a full service Merchant Bank formed from erstwhile Associated Discount House Ltd.

Commenting on this, CBN Governor, Mr. Godwin Emefiele, said, “ Net domestic credit (NDC) grew by 3.71 per cent in the same period, annualized, at 22.26 per cent.

At this rate, the growth rate of NDC was below the provisional benchmark of 17.94 per cent for 2016. Credit to the private sector grew by 1.45 per cent in February 2016, which annualized to a growth of 8.70 per cent, below the benchmark growth of 13.28 per cent. The Committee noted with concern, the dismal performance of growth in credit to the private sector, noting that even at that, credit went primarily to low employment elasticity sectors of the economy. This had a significant negative impact on output growth.

“Money market interest rates reflected the liquidity situation in the banking system. Average inter-bank call and OBB rates, which stood at 0.5 and 2.77 per cent on 25 January 2016, closed at 4.00 and 5.00 per cent, respectively, on March 9, 2016. Between January 25th and end-February 2015, interbank call and OBB rates averaged 1.43 and 2.68 per cent, respectively. This was traced to liquidity surfeit in the banking system. The deposit money banks were, however, reluctant to grant new credit because of rising non-performing loans (NPLs), mainly in the oil sector, amongst other reasons”.

Vanguard, MONDAY, MARCH 28, 2016 — 23

Interview

By Nkiruka Nnorom

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‘FG must be willing to support smallholder farmers’

ajor stakeholders in the agricultural sector recently converged in Kano to review critical issues in the sector at the 41st Regular Meeting of the National Council on Agriculture and Rural Development (NCARD) conference. Chairman, Executive Working Group (EWG) of the British American Tobacco Foundation (BATNF), Professor Femi Ajibola, from Obafemi Awolowo University, Ile-Ife, Osun State, who was there, shared his views with Financial Vanguard on the outcome of the conference and BATNF’s their productivity. What is role in agricultural your take on that?

It was quite cheering to development, among other hear the minister say that sundry issues. Excerpt. there is nowhere in the world that agriculture is not What is your assessment of subsidized, including in st the 41 National Council on Europe. Hence, what we Agriculture and Rural should be looking at is how Development (NCARD) we can actualize this here in Nigeria. We must devise a Conference held in Kano?

I am quite happy with the way of supporting these outcome of events. In terms farmers. The strategy is to of technical content, I think it ensure that the benefits and reach the was successful. The different subsidies smallholder farmers.

We must units and organisations that made presentations at the avoid a situation whereby conference demonstrated a they get into the hands of clear understanding of the benefit captors. For example, different sectors of the fertilizer subsidy scheme agriculture. They also for farmers was very well proposed adopted and tested demonstrated during the solutions to challenges in tenure of the immediate past agriculture in the country. I Minister of Agriculture, Dr. am really impressed with the Akinwumi Adesina. The presentations made at the subsidy was focused on a conference, particularly the small component that enabled way the Minister of farmers’ access directly. The Agriculture, Chief Audu good thing was that he did Ogbeh, tackled the issues in not allow the benefits to go the agricultural sector. I am into wrong hands. Another quite convinced that the important point is the close minister has a good idea of access to subsidy materials the direction the agricultural and other benefits for farmers.

No doubt, there may be sector in Nigeria is headed.

While unveiling the road loopholes in some of these map to improve the schemes, but we have to agriculture sector, the continue to improve on every minister prescribed two- programme. The fact that a pronged approach, which particular scheme did not includes the encouragement meet expectations does not of new generation farmers, mean that we should jettison especially the youth. Are you it. And that has been the optimistic that it will catch on, problem of government considering the growing policies.

You presented a paper on disinterest for farming the resolutions of the British among the youths?

Tobacco For the youths to embrace American Foundation (BATNF) agriculture, they must see that it earns them a good Executive Working Group livelihood. There is also the (EWG) Dialogue Session issue of convenience. If held last year. Are you farming or agriculture is hopeful the resolutions made less tedious, many would be incorporated into youths will embrace it. The the nation’s agricultural constraints in agriculture policies?

The draft document must be dealt with before you containing the resolutions of can encourage youths to be involved. We need to make the BATNF EWG ‘Dialogue agriculture commercial and it Session on Agriculture has to be done from a Policies and the Nigerian developmental perspective. Smallholder Farmers’ in We need to find a way of Nigeria held last year was dealing with the issues of submitted to the National agriculture and proffer ways Council on Agriculture. We were informed that of making it profitable.

The minister also talked government would review the about the expansion of document critically and support for smallholder ensure that it fits into its farmers in order to increase policies. It is gratifying that

government policies are in the r i g h t direction.

We are glad that we are dealing w i t h people who are already aware of the trend in agriculture.

Last year, BATNF assembled a team of experts and resource persons in the agricultural sector who formed an Executive Working Group (EWG) to review the Agricultural Transfor mation Agenda (ATA) and other extant agricultural policies in the country. What informed this initiative?

We have a BATNF Executive Working Group (EWG), which I chair. Our focus was on the smallholder farmers (SHFs). We tried to

The strategy is to ensure that the benefits and subsidies reach the smallholder farmers. We must avoid a situation whereby they get into the hands of benefit captors.

look at issues that affect SHFs. We examined the existing agriculture policies to see if they have had any impact on them and how they can be improved. We also reviewed what could be done to make the SHFs the center of attention of these programmes and policies. We believe that some modifications can ensure the SHFs are beneficiaries of these policies. We also realized that agriculture needs to be made operational and implementable in the rural areas and states.

Go for more skills, Olufade advises Nigerian youths

BY NKIRUKA NNOROM

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Professor Femi Ajibola

How much awareness is there among SHFs about financial support scheme for agriculture like Nigeria Incentives-Based Risk Sharing System for Agricultural Lending (NIRSAL)? And if any, are commercial banks that are critical stakeholders in the scheme willing to provide loans to farmers considering the widely held notion that agri-business is a high risk?

When we carried out our investigation, we discovered that there is poor awareness about the programmes among farmers in the Southern part of the country, compared to their counterparts in the North. The major challenge is that commercial banks still make the same requirements from farmers. There is still no significant difference between commercial banks’ interest rate for loans to farmers and the one for nonagricultural related purposes.

Do you subscribe to the bottom-top approach to rural agriculture development that some agriculture experts have been calling for?

Government should realize that for sustainable development in the agricultural sector, we need to devolve more resources and power to the local level. It is possible for the Federal Government to provide resources in the rural areas.

It is also possible for the State and Federal government to deploy resources there. The same model has been adapted by the health sector where the federal and state governments have primary care health centers in the rural areas, but that is yet to be replicated in the agriculture sector. In the Executive Working Group, we tried to include the SHFs in the implementation of this programme.

igerian youths, especially, fresh graduates have been advised to endeavour to acquire requisite skills, as their certificates are academic oriented and need to be enhanced with applicable skills in order to fit-in at the workplace.

The President of the Managerial School of Excellence (MSE), Mr. Leke Olufade, gave the advice to cross section of graduates who participated at MSE’s School-2-Work free monthly series themed: ‘Making your Certificate Count: Enhance it’.

Olufade said, despite the impact the degrees may have on graduates such as boosting their confidence, enhancing their earning abilities and improving their job stability and benefits, certificates alone may not give them the dream job or career.

He said university education is not all about the certificate but a complete value adding process.

Answering questions on the hope of graduates with poor grades at the market place, Olufade said poor grades are very bad especially in an environment with limited job opportunities like ours where qualified graduates are in hundreds of thousands.

He reiterated that a poor degree reduces one’s selfesteem, weakens confidence and encourages high job discrimination.

However, he said faced with this type of predicament is not the end of the road as such certificates can be enhanced by leveraging on other things learned during the course of their programmes, while other skills could be acquired to enable such people thrive in other areas of endeavours.

Responding, Kunle Badeafuye, a graduate of BACKCOCK University thanked the MSE president and his team for the great gesture at organizing a free monthly seminar for graduates to be able to get acquainted with the demands of the market place rather than depending solely on degree certificates that may not guarantee them their dream jobs and careers.

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24 — Vanguard, MONDAY, MARCH 28, 2016

Homes &Housing Finance

How to access a mortgage facility Bank to pay $29m for mortgage infraction Credit Suisse Group AG has agreed to pay more than $29 million to resolve a U.S. regulator ’s claims that it sold toxic mortgage-backed securities to credit unions that later failed.

The deal, disclosed in a filing in federal court in Manhattan, resolves one of several lawsuits by the National Credit Union Administration against banks over their sale of mortgage-backed securities before the 2008 financial crisis.

The deal boosts to more than $2.5 billion the amount the NCUA has recovered from banks through lawsuits it began filing in 2011, the U.S. regulator said. NCUA Board Chairman Debbie Matz said in a statement the regulator would “continue to aggressively pursue recoveries against Wall Street firms that contributed to the corporate crisis.”

The court filing, which described an offer of judgment in the case, said it would not have any effect on a separate but similar lawsuit by the NCUA against Credit Suisse pending in Kansas. The lawsuit subject to the deal centred on mortgagebacked securities underwritten and sold by UBS that Southwest Corporate Federal Credit Union and Members United Corporate Federal Credit Union bought for more than $228.8 million from 2006 to 2007.

The NCUA, which filed the lawsuit in 2013 on behalf of the failed credit unions, alleged that the securities’ offering documents contained untrue statements that the loans were originated in accordance with underwriting guidelines.

The NCUA alleged that in reality, the loans’ originators had “systematically abandoned the stated underwriting guidelines” described in the offering documents.

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Stories by YINKA KOLAWOLE, with agency report

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mortgage is a loan secured from a mortgage lender to buy a property for the purpose of home-ownership, and paid off in instalments over a set period of time. The length of time that the borrower agrees to take to pay off the loan is known as the Tenor of the mortgage. A mortgage is made up of two elements - the Capital, which is the original amount borrowed to buy the property; and the Interest, the amount charged to lend you the money. The mortgaged property secures your promise that the money you borrowed will be repaid. If the loan is not repaid as agreed, the lender can take possession of the property and sell it to recoup the money owed. For most people, a mortgage is the largest and most serious financial obligation they will ever make.

Choosing a mortgage When choosing a mortgage there are three important things to note: Interest rate: Interest rate is often seen as the most important consideration when choosing a mortgage. In general, borrowers look for a mortgage with the lowest possible interest rate. The lower the interest rate the less money you have to pay back over the mortgage term.

Each mortgage lender has its own standard variable rate (SVR) of interest. These can vary by several per cent, although most mainstream lenders will be within a couple of per cent of each other. However interest rate deals vary from lender to lender and sometimes the same lender may even offer different mortgage deals.

There are four main types of interest rate offers: Variable – rates change in line with CBN interest rates; Fixed – rates are fixed for a set number of years; Capped – rates are variable but guaranteed by the lender not to exceed a set amount; and Discounted – borrower pays a lower interest rate for a set period after which the interest reverts to the lender ’s SVR. Repayment terms: Mortgages payments are usually made monthly and can be done in two ways. The first is a repayment of the capital as well as the accruing interest on a monthly basis.

This kind of plan is often known as a Repayment Mortgage. The second method is to pay off the interest only every month and

•A private estate development in Abuja then at the end of the mortgage term e.g. 25 years the capital is repaid as a lump sum. This plan is usually known as an Interest-Only Mortgage.

While the Repayment Mortgage plan often requires higher monthly payments than the InterestOnly plan, the borrower will not have to produce a large sum to pay off the loan capital at the end of the mortgage term. In choosing a payment plan borrowers must bear in mind that the end of their mortgage term may fall around their retirement.

The second important point to note about repayment terms is that some lenders may penalise borrowers for paying off their loan before the mortgage term expires. This penalty is known as an early redemption penalty. While you have the right to pay your mortgage off at any time you like within the mortgage term you should find out before you sign up for a mortgage what

if any early redemption penalty there might be.

Mortgage fees/Charges: These are also called administrative fees and are charged by lenders to cover costs of valuation, legal, banking administration etc.

Lender fees can be anything from a several thousand naira to millions of naira,

For most people, a mortgage is the largest and most serious financial obligation they will ever make

depending on the mortgage you choose. Some lenders’ fees are higher than others for no apparent reason so make sure you study all the fine print in the mortgage agreement before you sign.

Ask questions to help you understand what each fee has been charged for and try to negotiate. Some lenders will be willing to reduce their fees.

If you are unsure about the details of a mortgage agreement and need some advice, a reputable mortgage broker can help you for a fee of their own.

Mortgage providers A mortgage can be obtained directly from any primary mortgage banking institution, or you can use a mortgage broker to find the best mortgage to suit your particular needs. Low interest mortgages can also be obtained from government via the National Housing Fund (NHF) scheme. *Source: MBAN

1m houses annually possible through collaboration — BUHARI

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he Federal Government is targeting the development of about one million housing units annually in collaboration with states and the private sector.

President Muhammadu Buhari disclosed this at a two-day National Economic Council retreat in Abuja last week. He said the Federal Government will provide 250,000 units, the 22 States controlled by the All Progressives Congress (APC) are expected to jointly provide 250,000 houses while foreign investors and their local partners would provide the remaining 500,000 units.

“Some estimates put Nigeria’s housing deficit at about 16 million units. In our successful campaign to win the general election last year, our party, the APC, promised to build a million housing units a year. This will turn out to be a very tall order unless the Federal Government builds 250,000 units, and the 22 APC States together manage another 250,000 units. We invite foreign investors together with locally-domiciled big construction companies to enter into commercial housing building to pick up the rest,” he stated.

Buhari identified the concerns of Nigerians regarding housing sector to include severe shortage of housing, high rents, unaffordable

prices for prospective buyers, especially middle and low-income earners. “In addition, red tape, corruption and plain public service inefficiency lead to long delays in obtaining ownership of title documents. Again, there are no long term funding sources for mortgage purposes.

These hurdles are by no means easy to scale, but we must find solutions to the housing deficit,” he added.

The president declared that government would review the relevant laws to make the process of acquiring statutory right of occupancy shorter, less cumbersome and less costly. He added that court procedures for mortgage cases should make enforcement more efficient while the Federal Ministry of Works and Housing should upgrade its title registration system for greater efficiency.

He also said transparent processes and procedures were necessary for achieving affordable housing for all Nigerians apart from developing strong and enduring mortgage institutions, adding that the Nigerian Mortgage Re-financing Company (NMRC), when fully operational, should ensure adequate support for mortgage financing.

Vanguard, MONDAY, MARCH 28, 2016 — 25

Corporate Finance Fidelity Bank to support export-oriented MSMEs with N30bn bonds STORIES BY NKIRUKA NNOROM

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idelity Bank Plc has

disclosed that 80 per cent of the net proceeds of the N30 billion bonds it recently raised from the Nigerian Stock Exchange (NSE) will be deployed to assist exportoriented Micro-Small and Medium Enterprises (MSMEs) in the country in order to raise their level of competitiveness in the global market.

The managing Director/CEO, Mr. Nnamdi Okonkwo, made the disclosure at a one-day workshop/training on exports organised by Koinonia Ventures Limited in conjunction with the bank.

He said the capital raising exercise is expected to enable the bank fulfil its promise to increase MSME lending to 50 percent by 2017. Okonkwo, who was represented by Chijioke Ugochukwu, the bank’s Executive Director, Shared Services & Products, said the lender ’s renewed focus on MSMEs was driven by its growing role in the transformation of economies.

He noted that huge prospects exist in the Agricultural and

Small Medium Enterprise (SMEs) sectors, saying that the sectors can play significant roles in diversifying Nigeria’s monolithic economy if they are properly positioned.

Speaking on ‘Turning Adversity to Prosperity: A Case for a Radical Repositioning of Nigeria’s Non-Oil Export Sector’, Olufemi Boyede, MD/ CEO, Koinonia Ventures, noted that the Nigerian economy can only make progress if local entrepreneurs become exportready. Commenting on the country ’s competitive advantage, particularly as it relates to export trade, Boyede said Nigeria currently has over 5, 000 exportable products, explaining that about 21 of such products can be quickly harnessed for the benefit of the nation’s economy. Alluding to the enormous successes of Obama’s National Export Initiative (NEI), the Koinonia boss urged the federal government to create the much needed environment for Nigerian exporters to thrive.

“The Barack Obama Administration has made it a top priority to improve the conditions that directly affect the private sector ’s ability to export”.

In her keynote address at the training programme, Aisha

Abubakar, Minister of State, Industry, Trade & Investment, said government is more than ever dogged in its quest to revive agriculture as an alternative to crude oil through

better reforms, value chain/ addition and discouragement of export of raw materials.

“There are a sizeable number of agricultural commodities grown in Nigeria that are

quoted in the international commodities market and these include cocoa, palm oil, groundnut, Sesame seed, Shea Nuts, cotton and even fish”.

Diamond Bank chair delivers inaugural TAMS Summit address

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R. Chris Ogbechie, Chairman, Diamond Bank Plc, will lead an array of panelists and discussants as the keynote speaker at the inaugural edition of the Time Attendance Management System (TAMS) Summit.

The TAMS Summit which will th take place on Thursday, 19 May, 2016, in Lagos, under the theme “From African Time to On Time: A paradigm Shift” is a high-level time management meeting organised by SB Telecoms & Devices as part of an effort to create awareness on the need for Nigerians to become more time conscious.

Speaking on the need for the summit, Mr. Afolabi Abiodun, Chief Executive Officer, SB Telecoms & Devices said, “In today’s Nigeria, the syndrome of African Time has become the norm rather than the exception.

As a people, we have always used this as an excuse for late-coming.

Dr. Chris Ogbechie The malaise is worsened by unreliable public transport system, poor road networks or traffic jams and lack of sanction.

“The goal of the TAMS Summit is to question the status quo. We believe this to be the significant first step required to make Nigerians more time conscious thereby improving our national productivity level. It was inspired by the acceptance and success of our TAMS application which has

solved this same problem for over 1,000 organisations.”

The summit is expected to attract thought leaders from reputable global institutions of learning as well as the public and private sectors of the economy.

They are expected to evaluate Nigerians’ curious devotion to the African Time syndrome and proffer solutions to the problems identified in order to improve human capital efficiency across all sectors of the economy, reducing time lost to procrastination and boosting the national productivity level.

Panellists who are expected to discuss and deliberate robustly on the theme include Mr. Obinna Ekezie, Managing Director, Wakanow.com; Mr. Eniibukun Adedayo, Chief Executive Officer, Clean Ace Dry Cleaners & Laundry; and others.

Insurance

Insurance policy holders to have identification numbers — NAICOM Stories by ROSEMARY ONUOHA

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he National Insurance C o m m i s s i o n (NAICOM) will soon commence the issuance of Unique Policy Identifier (UPI), a form of identification number, to insurance policy holders and also launch a portal that would warehouse the industry’s data.

Director of Research Strategy and Information Technology of NAICOM, Mr. Adamu Balanti, said that the unique policy identification system is to monitor and account for all policies issued by underwriters in the insurance industry.

Balanti who stated this during the seminar organised

by NAICOM for Business Editors and Insurance Correspondents in Abeokuta, Ogun State, last week, stated that the system will reduce to the barest minimum the prevalence of improper records regarding policies issued.

According to Balanti, the system will enable NAICOM to track the number of insurance policies issued by underwriters, adding that it would also enable the

Commission track the activities and revenues made by insurance companies and brokers.

He said, “This system is to build an integration point for the various stakeholders involved in insurance policy issuance. Generate and provide a unique identification number for every policy issued, in order to track and provide relevant statistics on them.

“It would help develop a capacity in NAICOM to record all policies issued by Nigerian insurance companies. Ensure proper accountability of all premium returns by insurance companies, capture all businesses done by every broker through the underwriter, ensure proper accountability of all insurance levies received from brokers, provide easy access to data regarding policies issued and support analysis and policy based decision making.”

Balanti said the portal provides a single point of access for all NAICOM services, validate the authenticity of insurance policies and accessible from any location within Nigeria.

He added that the system should be able to interact or

communicate with other systems/users such as FRSC, Police, and VIO. “We want to identify each individual insurance policy issued in the country, this is why we are developing the UPI. With it, each insurance policy document issued in the country will have a unique identification number. The

Unique number will be used to identify that document.

“We are also developing a database of that identification number, so that anybody in the country can query the database to confirm if the policy document before him or her is genuine or not. We are hoping that in the next few years, we will get it out,” he

added.

He noted that the initiative cuts across all insurance product lines, adding that all policies procured by the public must have this unique number.

He said the concept is not a duplication of the Nigerian Insurance Industry Database (NIID) being promoted by the Nigerian Insurers Association

‘Some brokers were operating without license’

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he National Insurance Commission (NAICOM) said some applications for insurance broking licence were rejected because it observed that some of the applicants have been operating illegally without its permission.

Commissioner for Insurance, Mohammed Kari, who disclosed this, said the responses obtained from the publication of the names of applicants for broking license revealed that some brokers have been operating illegal broking firms prior to the time they applied for licence.

He noted that a case in point was an applicant who has been changing his office due to illegal operations of the applicant.

Kari noted that the Commission is determined to sanitise the insurance business, stressing that charlatans would not be allowed to infiltrate the sector.

On brokers with lapsed licences, he said the action taken by the Commission when it published the names of the affected brokers was misinterpreted, adding that the Commission did not delist any broker, but only played its regulatory duty of letting the public know the firms that do not have valid licence to operate.

“Delisting connotes cancellation of licence of operations; it connotes stopping one from doing business, unfortunately, the interpretation of our action as

delisting is wrong. We did not delist anybody neither did we cancel any licence. If you look at the publication we did, it was to tell the public that the affected brokers do not have a valid licence to continue in business because their licences have lapsed.

“However, lapsing of a licence is not the action of the Commission. It is a failure of the owner of the licence to renew it. So, all the companies on that list had lapsed licences. None of them were delisted nor cancelled. It is our responsibility to tell the consumers that these companies have no licences to do businesses. That is our responsibility which was misinterpreted as delisting or cancellation,” he said.

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26 — Vanguard, MONDAY, MARCH 28, 2016

e-Commerce

SPAR launches 9th store in Nigeria

By JULIET EBIRIM

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etail giant, SPAR Hypermarket has opened its 9th store in Nigeria, an ultra-modern mall on situated at Ilupeju, Lagos.

Speaking at the opening, Deputy Managing Director of SPAR, Mr. Prakesh Keswani, said SPAR Ilupeju, as with its forerunners, targets all cadres of Nigerians.

He said: “SPAR and its holding company here in Nigeria- Artee Group have grown to understand and appreciate the needs and aspirations of Nigerians especially on the community level.”

At the launch, the brand which has the largest retail chain of Hypermarkets globally gave residents of Ilupeju and Lagos mainland a memorable day of gifts and refreshments as it celebrated the opening of its 9th Store in Nigeria.

The Store offers a wide range of products by quality brands, ranging from Grocery & Household, Bakery & Butchery, Fruits & Vegetables, Hot Meals, Wine & Spirits, Fast Moving Consumer Goods, Consumer Electronics, Large and Small Home Appliances, Fashion and Beauty items, Mobile Phones, Laptops & Tablets, Perfumes, Watches & Jewellery and Furniture etc.

Artee Group is the licensed partner of SPAR International for Nigerian operations.

SPAR Hypermarket stores with over 25,000 m2 of retail space spreading across 9 stores serves over 5 million shoppers annually. Apart from Ilupeju Mall, SPAR stores are located in Victoria Island, Lekki, Maryland Ikeja, MMA2, Abuja Wuse II & Ceddi Plaza, and Port Harcourt.

For almost 3 decades, the group has greatly contributed to the Nigerian business sector. From retail to real estate, shopping malls to manufacturing Artee group has sought to create avenues for employment and partnership opportunities even to building contractors.

All of the group’s brands nationwide are specifically targeted to service the needs of the average Nigerian.

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INVESTITURE: From left, Mr Oladosu Babalola, husband of the new Chairperson; Professor Olubola Babalola, new Chairperson, Women Association of Quantity Surveyors of Nigeria (WAQSN); Mrs Mercy Torkwase Iyortyer, President, Nigerian Institute of Quantity SurveyorS and Mr Agele Alufohai, Past President NIQS during the investiture of Professor Olubola Babalola as the new Chairperson of WAQS by the National President of NQIS, Mrs Iyortyer in Lagos.

Ringier Africa Deals Group acquires DealDey STORIES BY JONAH NWOKPOKU

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ne of Nigeria’s pioneer online marketplaces, DealDey has been acquired

by Ringier Africa Deals Group, a newly-founded joint venture between Swiss Ringier Africa AG and South African Silvertree Internet Holdings.

DealDey was launched in 2011 as an online shopping and daily deal platform by serial entrepreneur and former CEO/founder of Konga.com, Simdul Shagaya.

In a statement announcing the deal, Ringier Africa said the acquisition represents an expansion of Ringier Africa’s

portfolio beyond publishing and digital marketing in Nigeria and Silvertree’s first e-commerce investment in the country. It sees the two companies invest significantly in Nigeria’s fast-growing multi-billion dollar ecommerce sector as part of their partnership in the Ringier Africa Deals Group.

Over the past five years, DealDey has established itself as major e-commerce player in Nigeria, with over 1 million users, 15,000 active merchants and 20,000 verified listed businesses.

Reacting to the deal, DealDey Co-CEOs Kehinde Oriola & Etop Ikpe said: “The DealDey team is excited about joining forces

with the newly-formed Ringier Africa Deals Group. It offers great opportunities as DealDey brings a wealth of experience in technology, merchant management and consumer behaviour in Nigeria - and we will be leveraging the Ringier Africa portfolio in marketing, classifieds and media as well as Silvertree’s e-commerce expertise towards supporting the sustainable growth of the group.”

The statement also added that as part of the deal,Kehinde Oriola will continue as the CEO of DealDey as part of RADG, while Etop Ikpe will be moving on to new ventures.

As acting CEO of RADG,

Damien Bonnabel, current Head of e-Commerce for Ringier Africa and General Manager of Ringier Kenya, will be working with the m a n a g e m e n t of DealDey and the group’s other companies.

Also speaking, Ringier Africa General Manager, Leonard Stiegeler said: “Ringier Africa has identified e-commerce as a key area for growth and we are excited by the inclusion of DealDey in the Ringier Africa Deals Group. With the addition of ec o m m e r c e experienced Silvertree as a partner and investor, we are on track to significantly increase our interest in the space, with particular focus on serving the important markets of Nigeria, Ghana and Kenya.”

On his part, Silvertree coManaging Director, Paul Cook said: “We are extremely excited to be entering three of Africa’s most exciting ecommerce markets, through our partnership with Ringier and joint investment into DealDey, Rupu and Tisu.

Through this deal, we get to build on excellent existing platforms as we look to serve Africa’s emerging middle class. With Ringier ’s deep content expertise and African footprint, we look forward to further accelerating the growth of these exciting businesses.

Our focus will be on rapid but sustainable growth, as Africa’s e-commerce industry starts to mature and consumers look for worldclass offerings, excellent customer service and great deals.”

Konga launches same day delivery, liberalises logistics solution

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igeria’s online marketplace, Konga.com, has unveiled a same-day delivery service for orders placed same day within Lagos.

This is even as it launched the ‘Keep On Shipping’ KOS Delivery Service which liberalises Konga’s hitherto exclusive logistics service, KExpress, allowing Konga ship orders for other businesses and individuals besides Konga.

Speaking at the media launch of the two services in Lagos, Konga’s new CEO, Shola Adekoya said: “Konga is launching two game changers, same day dselivery and rebranding our proprietary nationwide logistics service from K-Express to KOS built to improve delivery capabilities.

With Same Day Delivery, when you place order on Konga for an item before11am, rest assured that your item will be delivered to you the same day.

When you order after 11AM, the item will be delivered to you on or before 12 noon the next day. This service is available from Monday through Saturday in Lagos metropolis for now but will expand to other locations

across the country shortly.”

Also speaking, Konga’s Director of Fulfilment Operations, Wale Adisa said: “With the experience built over 18 months and with reach in all the state capitals in Nigeria, KOS has been

rebranded to grow the ecosystem by opening up Konga’s ability to deliver promptly and in good condition to corporate bodies, e-commerce and individuals in all the 36 states in Nigeria.”

Uber launches in Abuja as CEO says other market’s profits supporting China spending we’re growing,” he

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ide hailing App Company, Uber Technologies has launched its services in Abuja city as it embarks on aggressive expansion across Nigerian cities.

This comes as Uber’s global CEO, Travis Kalanick told reporters in an interview last week that the company which is generating more than $1 billion in profit a year in its top 30 cities globally, is partly using that money to bankroll its expansion in China.

The company said in February it was losing more

than $1 billion a year in China’s red-hot ride hailing market, where it is battling large local incumbents to win customers.

Kalanick said China was the company ’s most intense market, but also a crucible for new ideas that it has exported to other markets, and that its investment here was sustainable.

“If you took our top 30 cities today, today they ’re generating over $1 billion in profit a year, just our top 30 cities. And that profit multiplies every year because

said.

Other cities among the 400 where Uber operates were also profitable, he added.

“So that helps us to sustainably invest in our Chinese efforts... Because of the profits we have globally, this is something we can do for the long run,” he said.

Recall that Uber and China’s Didi Kuaidi, backed by Chinese technology giants Tencent Holdings Ltd and Alibaba Group Holding Ltd, have both spent heavily to subsidize fares to gain market share, betting on China’s Internet-linked transport market becoming the world’s biggest.

Vanguard, MONDAY, MARCH 28, 2016 — 27

People in Business

Govt should look beyond the big companies, focus start-ups

taught and empowered to do the processing. They do not have to be educated.

Education is a plus but if they start from those women, they will benefit our industries. So government really needs to look at how to develop technology because we have a lot of things we do not know the benefits we can derive from them."

— TOSIN OLABIMTAN-LANIYAN

BY EBELE ORAKPO

M

rs Tosin Olabimtan-Laniyan is the Chief Operating Officer of Hi-Stakes Ventures Limited, holding company of Meraki Organics, makers of Meraki organic soap brand. In this chat with Financial Vanguard, she speaks on her business and why she went into organic soap production, the challenges. She regrets that although the raw materials are abundant here but Nigeria does not have the technology to process them.

Excerpts: our skin."

Impacting society: Food for skincare: According to Mrs. "We make coconut oil in Olabimtan-Laniyan who Nigeria, so I started making attended the University of bath soaps with coconut oil, Lagos and did palm kernel oil etc. But I was Entrepreneurship not yet satisfied because I programme at the Panwanted a soap that will African University, she went moisturise, that will be skininto organic soap production deep; something that you after extensive research, to will use and actually see it mpact the lives of fellow men work immediately on your especially having been skin." blessed immensely by God and by those God has More research: surrounded her with.

"I decided that my soaps "It is in this quest that I must have some other oils started asking God to give infused into them. So I me an idea, something that started researching. I have will not only satisfy me in had several trainings in skin terms of profit but care products something I will do with both in the US and passion and that anybody UK. I went to the that uses it will be blessed Federal Institute by it. I needed something of Industrial that I will not have to be Research, Oshodi travelling out of Nigeria all (FIIRO) for a the time because for so many formal training. years, I have been into Apart from that, I importation and exportation. am an inquisitive About 10 years ago, my person so I always church started a vocational want to know. I centre and one of the courses thought about was soap-making." baobab oil, I read about it and realised we can benefit Going into soap-making: a lot from this tree that we "A year ago, the Lord said have in abundance in the to me, “ what about things on north. wellness, wellbeing, good Also Neem (dogonyaro) oil health?” is really good on the skin, I love salads but then, highly moisturising, deepsalad business with our conditions the skin, good for epileptic power supply? How aging skin and rich in will I cope? I was making vitamins. Coffee also." salads for friends and family during occasions. I kept Importing oils: praying and the Lord said a "I couldn’t get the oils lot of Nigerian ladies like to easily here so I had to buy tone; they bleach and call it from abroad. Family and toning “so why can’t you do friends were willing to use something about skin care?" the products and give me Nigerian ladies love to look feedback. From their good. We talk about only feedback, I was able to clothing but what about skin improve on the products. I and hair? So the idea of started adding cocoa butter, doing something about skin mango butter etc. That was care came up. how my organic skincare Skin care is about being products business started. aware of what you are using I realised that if I am doing because whatever soap or organic, I have to know the cream you use on your skin is source of every raw material like eating food so you need to that I use and I can testify know how the soap is made, to the fact that the oil I use with what, and the benefits. I is 100 per cent organic and said if it is skin care, then it it is pure, no preservatives. has to be organic. Some of the Using organic skin care things we eat are also good on

*Mrs. Tosin Olabimtan-Laniyan....Government really needs to look at how to develop technology

*Neem seeds

It costs an average of N150,000 to analyse each product; how many start-ups . can afford N150,000?

products is like feeding the skin with good food."

Nigeria is blessed but…

God has richly endowed Nigeria. Our vegetation is excellent but what we lack most of the time is technical know-how to process them and make them beneficial for industries. I have approached quite a number of people to see if they can

*Baobab seeds help us with processing of certain oils from our local trees but we have found none. I went for a course last year and we were told that poppy seed oil, which looks like water, is good for anything facial. It is antiaging so I started researching on other things we have in Nigeria that can be used as anti-aging. They are innumerable but we have not just done the research."

Appeal to researchers: "Where the research has been done, we do not know how to process the oils. So our research institutes should please look into how to help to process these things to get oils. There are people like me that are into organic products that will need these oils and we pay a lot to buy from abroad whereas we have them in abundance here just wasting away."

Empower locals:

"Local women can be

Doing business in Nigeria: "It is not easy setting up a small business in Nigeria. For example, I discovered it is easier for someone to get NAFDAC approval for anything that has to do with food than any other thing. At a seminar I attended, the NAFDAC representative said that if you are a baker or bottling palm oil or whatever, they will inspect your kitchen and if they find it suitable, you will get approval once you meet all the criteria. I asked whether they will give approval to someone who is into organic skincare products operating from home. They said: “No, you cannot do it from your kitchen table because your kitchen table is where you feed your family and you are dealing with chemical, specifically, caustic soda and that for such to get approval from NAFDAC, you need a site separate from your kitchen with a minimum of three rooms – a production, cutting and packing rooms,” which they would inspect and test the products. It costs an average of N150,000 to analyse each product. How many startups can afford N150,000?

We have different skin needs - dry skin, average skin and aging skin.

Someone with aging skin needs to deeply moisturize.

I cannot make one type of soap for all. So will I be made to pay N150,000 for testing each?

So we need the government to look beyond the big companies, look at start-ups.

How can government help people like us to get through NAFDAC? Our products are good; we do not use anything harmful to human or the environment."

Few years from now:

In the very near future, we will be able to sell our products beyond Africa. We will be promoting locally made products that can compete with products made by companies around the world. We believe that with assistance from government and its agencies, we can surpass our expectation," she said.

28 — Vanguard, MONDAY, MARCH 28, 2016 “The Federation Accounts Allocation Committee on Friday shared N613.6bn among the three tiers…[and] N620.73bn shared in the month of February”. PUNCH, April 21, 2012.

COMPARISON OF MONTHLY ALLOCATIONS: JUNE 2006 AND FEBRUARY 2016.

It is no longer news that the states of Nigeria are in serious financial straits.

Nigerians need to know how they got into these difficulties and the way out can then be sought. The years 2012 and 2013 were our golden years in terms of crude oil revenue and allocations from the Federation accounts to the three tiers of government. The figures below tell part of the story better than any number of words can tell us.

2012 2016 DIFFERENCE(%) N620.73bn N370.39bn 40

FEB

As can be seen from the figures above, all the three tiers of government will receive for February 2016, N250.34bn, or 40% less funds than they did in 2012. That is bad enough. Take a look at the figures below. The total revenue allocation to all the 36 states in 2006 and 2016, a decade after, are very revealing.

JUN 2006 N196bn

FEB 2016 DIFFERENCE(%) N97.31bn 51

In other words, the states are receiving in the first two months of 2016 only half of what they collected in 2006. More revealing is the fact that four states, in 2006, collected over N14bn each. In descending order, they were: Rivers (N23bn), Bayelsa (N18bn), Delta (N16bn) and Akwa Ibom(N14bn). The least revenue collected by any state in June 2006 went to Nasarawa (N2.99bn). In February 2016, no state collected up to N10bn. The top four revenue earners in February 2016 were: Akwa Ibom(N8.55bn), Lagos (N6.61bn), Delta(N6.06bn) and Rivers (N5.42bn). That means that Akwa Ibom now collects 61 per cent of what it did in 2006 Rivers now collects 24 per cent of what was taken home in 2006, Delta 38 per cent; Bayelsa only 17 per cent. See the table below.

STATE JUN 2006 FEB 2016 DIFFERENCE(%) Akwa Ibom N 14bn 8.55bn -39 Bayelsa N18bn 2.98bn -83

States sink deeper into financial quagmire —1 Delta Rivers

N16bn N23bn

6.06bn 5.47bn

-62 -76

Incidentally, Lagos State has emerged as the second highest collector of federally allocated revenue with N6.6bn in February 2016 and it is the only state which earned more in 2016 than it did in 2006. The reason is clear. The state’s share of the Value added Tax, VAT, had steadily pushed it close to the top. There is a subtle lesson for all states in this: attract manufacturers to your state and earn the rewards afterwards in high Internally Generated Revenue, IGR. The state collecting the least allocation in February 2016 was Osun state (N6.23m). That is right, a mere six million two hundred and twenty nine thousand naira for a state claiming a monthly wage bill of close to N2.7 billion. Now it is clear why that state is in the sort of turmoil which other states will soon be experiencing.

How about Bayelsa state, the former President’s own state? Well, Bayelsa went from N18bn in June 2006 to an astonishing N2.98bn in February 2016 – a drop of 83% from ten years ago. That makes Bayelsa the second worst case among states. Osun State, unfortunately, carries the unwanted trophy of the state closest to bankruptcy.

THE ROAD TO HELL The logical question is how did we get into this sorry situation as result of which state governments and their public servants are now poised for protracted conflict? Only a fool can fail to see the

danger signs all over Nigerian states.

For this another set of facts are required — drawn from the records.

NUMBER OF STATES COLLECTING REVENUE Categories States Jun 2006 States Feb 2016 N25-10bn 4 0 N9-6bn 3 4 N5-4bn 7 0 N3-2bn 22 25 Under N2bn 0 7 The facts are clear. States are getting increasingly poorer. Furthermore, whereas only one state collected less than N3bn in June 2006 and that was Nasarawa, N2.9bn, thirty two states in February of this year would collect less than that amount – and that trend will continue indefinitely. It might even get worse with time.

PUTTING ON OUR THINKING CAPS The first thing the reader, even if he is a paid employee of a state government, should discard is the notion that this piece has been written to run down his state government. Obviously, when Osun (APC controlled) and Bayelsa (PDP controlled) had been highlighted from figures supplied by the Federal Ministry of Finance, every state is only receiving a feedback on how well it had prepared itself for the proverbial rainy day. On the whole state governors of the class of 2007 to 2015 have been irresponsible and perhaps unpatriotic – irrespective of what their party members and paid defenders might say about them.

Microfinance

Growing entrepreneurship to address unemployment STORIES BY PROVIDENCE OBUH

T

address unemployment, there is a need to increase the number of entrepreneurs in the country via vocation in different skills thereby enhancing employment and increasing economic value especially among the youths.

Just last week, the Tony Elumelu Foundation (TEF) announced the selection of 1,000 entrepreneurs for the second round of the Tony Elumelu Entrepreneurship Programme (TEEP).

TEEP was launched in 2015 as the largest African philanthropic initiative devoted to entrepreneurship and represents a 10-year, $100 million commitment, to identify and empower 10,000 African entrepreneurs, create a million jobs and add $10 billion in revenues to Africa’s economy.

For 2016, over 45,000 entrepreneurs from 54 African countries applied, more than doubling the number of applications received in 2015.

Meanwhile, successful candidates represent diverse industries, led by agriculture, ICT and fashion, while, the highest numbers of applicants came from Nigeria, Kenya, Ghana, Uganda and Cameroon. All five regions – C M Y K

o

North, East, Southern, Central and West Africa are represented.

In his remark, Founder, Mr. Tony Elumelu, said, “In TEEP’s first year we spent over $8 million of our $100 million commitment with $5 million going directly to entrepreneurs as seed capital and the results have far exceeded our expectations.

We have funded

entrepreneurs, established networks and helped extraordinary people take control of their destinies. The 2016 Tony Elumelu Entrepreneurs will become a generation of newly empowered African business owners, who are the clearest evidence yet, that indigenous business growth will drive Africa’s economic and social transformation.”

Consequent to this, one million young people in Nigeria may soon become employers of labour if the initiative being proposed to the Bank of Industry by the Chairman of Afterschool Graduate Development Centre (AGDC), Mrs Ibukun Awosika sees the light of day.

She approached the BoI seeking a partnership, aimed at scaling up financial

inclusion of Nigeria’s youths.

Awosika in a meeting with the Executive Management Committee of the BoI said that the initiative, “ignite idea” hopes to raise a million young entrepreneurs who will provide jobs as well as create value.

She said that the initiative becomes imperative because those without jobs need to be saved in their numbers.

NNEW expresses dissatisfaction with non-passage of gender equality bill

N

ECA’s Network of Entrepreneurial Women (NNEW) has expressed disappointment and displeasure over the dismissal of the Nigerian Gender & Equal Opportunities Bill by the Nigerian Senate, on Tuesday 15th March, 2016.

The Bill titled, “A bill for an Act to Incorporate and enforce certain provisions of the United Nations Convention on the elimination of all forms of discrimination against women, the Protocol of the African Charter on Human and People’s Rights on the rights of women in Africa, and other matters connected therewith, 2016 (SB. 116)” was sponsored by Senate Minority Whip, Senator

Biodun Olujimi, representing Ekiti South Senatorial District.

The bill seeks to promote equal opportunities, advancement of all persons, prohibition of violence against persons, among others; eliminate discrimination against any person, irrespective of gender or any grounds, but as a result of disagreements, it failed to pass the second reading.

In a statement, President NNEW, Mrs. Lola Okanlawon, stated, “by throwing out this Bill, the Senate seems to give their support to the subtle and increasing discrimination against women in nearly all facets of life in Nigeria.

“The Senate is also ignoring

the many illegal obstacles that have been erected using regulatory, socio-cultural, and religious excuses to deprive the women of Nigeria of their rights as guaranteed by the Constitution of the Federal Republic of Nigeria”.

Okanlawon added that the rejection of the bill seeks to undermine the remarkable contributions of the Nigerian women towards national development.

“This is not the first time that this bill has been shot down by lawmakers who quickly wear the toga of religious and cultural chauvinists whenever matters that border on the economic and political empowerment of women are to be discussed.

“We want to remind the

Senate that Nigerian women constitute about 49.09 percent of the population of the country (World Bank Report, 2014) and therefore, it should be of serious concern to them that women are only a minute minority in both the National Assembly and State Houses of Assembly. This, we believe, sealed the fate of that noble bill. “That Bill was about humanity and not just about women and this should occupy the time and attention of the Senate.We therefore, call on the Senate to revisit this bill, especially in the context of the Sustainable Development Goals (SDGs), while we hold the Senate President, Senator Bukola Saraki, to his promise to reconsider the bill,” she said.

Vanguard, MONDAY, MARCH 28, 2016 — 29

Aviation

Foreign airlines to sack 2,000 Nigerian workers

By LAWANI MIKAIRU & DANIEL ETEGHE

T

he National Union of Air Transport Employees ,NUATE, has revealed that foreign airlines plan to sack about two thousand (2,000) Nigerian workers due to what they claimed is their inability to transfer their earnings to their respective home countries to meet operational costs in accordance with international rules because of new Central Bank of Nigeria , CBN, policy on forex and fund transfer.

In a letter addressed to the Minister of State for Aviation, Senator Hadi Sirika and made available to newsmen, Acting General Secretary of NUATE, Comrade Olayinka Abioye said the plan has destabilize the affected workers, adding that the Federal Government should wade in and prevent the huge job loss.

According to Abioye , “ The reason being adduced for this danger is that their earnings

By LAWANI MIKAIRU

V

WORKSHOP- From left: Paul Uduk, MD, Vision and Talents; Adaghubu Franklin, Human resource, Fidelity Bank; Val Eze, Human Resource Expert; Uchechi Ogbonna, Learning and Development, CSCS; Haruna Adinoyi, AGM, Dangote Academy and Emmanuel Nwachukwu, HR, Business Partner, Nigerian Breweries at the People Plan 2016 workshop by Vision and Talents held in Lagos. in the past year is under lock with the Central Bank of Nigeria, CBN , as they are unable to transfer these earnings to their respective home countries to meet

operational costs in accordance with international rules.”

“Following concerns raised recently by leaders of these workers and other

TBI partners major airlines to introduce cruise in Nigeria

By LAWANI MIKAIRU

T

our

Brokers International Nigeria has introduced cruising to its operations by creating New Royal Carribbean Cruises division. This will now enable Nigerians, visitors and expatriate who want to go on cruise tour to book in Nigeria instead of the hitherto practice of booking via United States of America or United Kingdom.

Addressing newsmen at the TBI Head office in Lagos, the Managing Director, Mrs Uloma Egbuna said the company’s partnership with major foreign airlines like the Emirates, KLM, and Delta Airline will enable Tour Brokers organize cruise tours to any part of the world.

Emirates, for instance, takes would be cruise tourists who want to exploit the beauty of the Gulf region to Doha, Qatar where they can board the Royal Carribbean ship and sail to any part of the region.

Same goes for intended tourist to USA and Europe.

They will enjoy their flights to USA or Europe on board KLM or Delta Air before boarding Royal Carribbean

Emirates deploys technology for this year’s Emirates Airline Festival of Literature

and commencing their cruise tour of USA or Europe after all the necessary bookings and arrangements have been made conveniently in Lagos, Nigeria, According to Egbuna, TBI has “branded their Lagos street front incorporating the Royal Carribbean Cruise Line official logos . This is testimony to our excellent relationship with and support

from Cruise International and Royal Carribbean faith in our company. TBI is blessed with a robust pedigree in customer management and satisfaction” “TBI has been in the forefront of championing cruises as a holiday destination in Niger. First time cruisers as well as veterans of the sea are welcome to discover the best value holiday on the planet .”

stakeholders and in appreciation of the good intent of the government’s fiscal policy, we humbly make this clarion call for your (Minister) intervention to grant foreign airlines concession to repatriate their proceeds to their home countries,” he said.

He added that should the foreign airlines go ahead with the sacking of the workers it would not be in the interest of the aviation sector and Nigeria as a whole.

“We hasten to place on the front burner an emerging threat confronting over 2, 000 private sector aviation workers in Nigeria which requires your intervention to forestall imminent loss of jobs of these number of workers,” said Abioye.

NAMA trains 100 air traffic engineers

By LAWANI MIKAIRU & DANIEL ETEGHE

A

bout 100 Air Traffic engineers have been trained by the Nigerian Airspace Management Agency, NAMA, in 2015 in various professional areas.

Disclosing this development to newsmen, the National President of the National Association of Air Traffic Engineers, NAAE, Engr.

Ebenezer Makanjuola, said at the NAAE day in Lagos, that about 70 members of NAAE have also benefited from various trainings.

Makanjuola expressed

delight that Licence and Rating for Electro Mechanical Services Department of NAMA has been restored while the process of clearing backlog was on going.

The NAAE president explained that the process for the harmonisation of allowances for Nigerian College of Aviation Technology (NCAT), Zaria chapter of NAAE was on going as they were dialoguing with the management of the college.

While urging members of NAAE to uphold professional etiquettes, respect hierarchies and be responsible for everything they do,

Makanjuola warned against compromising their standards.

He urged members to carry out their jobs with dedication and selfless services as the lives of air travelers depended on their professional inputs.

He announced that Nigeria will be hosting the 46th edition of the global event IFATSEA 2016, adding that a committee will soon be set up to commence work.

Makanjuola commended NAMA, the Nigerian Civil Aviation Authority (NCAA) and NCAT for their support, which according to him made it possible for the association meet its financial obligation.

isitors to this year’s Emirates Airline Festival of Literature will witness the latest deployment of technology as they will have imaginative on-ground experiences that “merge family fun with technology”.

According to Dina Al Herais, Emirate VP Commercial , VIP Customer Relations , “People are constantly interacting with technology, and this year we wanted to connect with visitors in innovative ways. So we built on our latest virtual reality innovations to help create more awareness around Emirates’ history - in keeping with the festival’s theme of time.

Our visitors will also have the opportunity to experience the breadth of our destination network in a fun way.”

Sterling Bank partners AUDAX on coding programmes AS part of its One Education initiative, Sterling Bank has announced its partnership with AUDAX Code School, an e-learning, training, and assessment solutions company for the 2016 Coding programme.

The programme is designed to improve digital literacy through coding in a fun and collaborative environment for primary and secondary school students in Nigeria.

While disclosing this to newsmen in Lagos, the Bank’s Group Head, Strategy & Communications, Mr. Shina Atilola noted that the objectives of the exercise are to bridge the digital skills gap in Nigeria; empower children and teachers in both rural and urban areas; foster creativity and creative thinking skills through information and communications technology learning and encourage careers of underprivileged youth through Science Technology Engineering and Mathematics (STEM) C M Y K

30 — Vanguard, MONDAY, MARCH 28, 2016

Economy

Why real sector special funding facility is delayed — CBN STORIES BY EMEKA ANAETO, ECONOMY EDITOR

C

ontrary to insinuations that Central Bank of Nigeria, CBN, may have abandoned the plan to inject about N760 billion into real sector special credit facility following last week’s policy reversal, the apex bank has indicated that the plan is still alive.

CBN had adopted accommodative monetary policy since July 2015 in the hope of addressing growth concerns in the economy, effectively freeing up some funds for commercial banks by lowering both Cash Reserve Ratio, CRR, and Monetary Policy Rate, MPR, with excess liquidity arising from the lower CRR totalling N760 billion, warehoused at the CBN. Banks were to access these funds by submitting verifiable investment proposals in the real sector of the economy.

But after over eight months now no real sector operator has received loan from this fund up till last week when the apex bank reversed the policy that gave rise to it, increasing both CRR and MPR. The development last week gave rise to speculations that CBN may have technically abandoned the funding plan.

However, in its Monetary Policy Committee, MPC, Communique last week the apex bank indicated that it would still go ahead with the plan stating that “the funds have not impacted the market yet because the CBN was still processing some of the proposals submitted by the banks”.

But the apex bank also noted that in the first policy episode of easing which resulted in injecting liquidity

into the banking system, the banks did not grant credit as envisaged, a situation which may have partly informed the policy reversal last week.

This and other developments such as the delay in passage of the 2016 Budget, according to CBN, “has further accentuated the difficult financial condition of economic agents as output continues to decline due to low investment arising from weak demand”.

CBN stated, “the cautious approach to lending by the banking system underpinned by a strict regulatory regime conditioned by the Basel Committee in the post global financial crisis era has further alienated investors from access to credit as banks prefer to build liquidity

profiles in anticipation of government borrowing.

“In the light of these developments, domestic output growth in 2015 remained subdued as reported by the National Bureau of Statistics, NBS”.

According to NBS real gross domestic product, GDP, grew by 2.11 per cent in the last quarter of 2015, more than half a percentage point lower than the 2.84 per cent recorded in the third quarter and 3.83 percentage points in the corresponding period of 2014.

Overall, growth in 2015 was estimated at 2.79 per cent, compared with 6.22 per cent in 2014.

FG, CBN in fiscal, monetary policy harmony T

here were indications that a complementary interplay of fiscal and monetary policy may have begun with last week’s policy actions from the authorities in both arms.

Following the passage of the 2016 Appropriation Bill by the National Assembly on Wednesday last week Federal government through the ministry of planning indicated that it would commence its expansionary fiscal measure which primarily was predicated on infrastructure and other capital expenditure programmes.

The expansionary budgetary implementation would also involve deficit spending to the tune of N2.2 trillion, aimed at stimulating the economy.

The fiscal action came on the heels of a special retreat of the National Economic Council which was driven by a singular focus on steps to address the

troubled economy and the financial condition of the sovereign states. The Council outlined eight thematic areas and 71 specific proposals that signposts the economic policy direction of the President Buhari administration to rescue the economy from its current southwards trajectory.

Also early last week the monetary authority, Central Bank of Nigeria, CBN, rolled out a new policy aimed at price and exchange rate stability through monetary tightening.

Economy analysts said these developments signal a resumption of balanced approach to solutions and strategy for addressing economic challenges.

Hither, it was only CBN that was active in battling the increasing headwinds the economy had witnessed in the past 10 months, a situation which had made results fall

short of targets since CBN was not structurally equipped for the dual roles.

In its bid to fill the gap created by long absence of a federal cabinet last year and consequently play the dual role, the apex bank had adopted an expansionary monetary policy since third quarter 2015, by reducing its monetary rates, cash reserve and liquidity ratios, so as to release more money into the economy.

Some analysts believed CBN now focusing on monetary policies may have reversed its expansionary monetary policy in favour of monetary tightening as a preemptive strategy to contain the anticipated inflationary impact of government’s expansionary fiscal regime expected to kick off with the passage of the Appropriation Bill.

Alluding to this reasoning,

analysts at Afrinvest West Africa, a Lagos based investment house, said ”the tightening move is more of a precaution (than a correction of previous price spiral) to moderate the demand pressure for foreign exchange, goods and services that could arise from the liquidity impulse of the record expansionary budget. ”The 2016 fiscal year is expected to run on N6.06tn budget while deficit was retained at N2.2 trillion, 2.1 per cent of gross domestic product, GDP. ”It could be a signal that monetary policy, which had hitherto been the only game in town, will return to its conventional objectives of price and exchange rate stability while fiscal policy escapes from its tardiness to anchor the recovery. This could mean a return to inflation targeting”.

Contribution and Growth Rate by Sector Contribution to GDP 2012

C M Y K

2013

2014

2015

Agriculture Industries

23.91% 23.33% 22.90% 23.11% 25.61% 24.81% 24.93% 23.715

Services

50.48% 51.86% 52.16% 53.18%

Growth Agriculture

2012 2013 2014 2015 6.70% 2.94% 4.27% 3.72%

Industries Services

2.43% 2.16% 6.76% (2.24%) 3.97% 8.38% 6.85% 4.78%

Vanguard, MONDAY, MARCH 28, 2016 — 31

Advertising & Media

Why value-based pricing works against competition —-BuildCon Boss

V

alue-based pricing, VBP, is the most highly recommended pricing technique by consultants and developers. The basic concept is setting a price to capture the majority of what customers are willing to pay. Princewill Ekwujuru spoke to Bukola Gadzama, CEO of BuildCon Global Services on this differentiation.

Competitive pricing has been described by marketing experts as setting the price of a product or service based on what the competition is charging. Competitive pricing is used more often by businesses selling similar products, since services vary from business to business while the attributes of a product remain similar. This type of pricing strategy is generally used once a price for a product or service has reached a level of equilibrium.

It is with this reasoning that Bukola Gadzama, Chief Executive officer of BuildCon a major player in the real estate sector in Nigeria leveraged to create a differentiation in the sector with unique pricing that endeared it to customers. The company running since 2013 has build over 16 units of houses and has instituted a payment plan for houses that is light for customers.

Her words, “We also give customers a payment plan of between 2-3 years, that helps and reduces the pain of outright payment. We encourage them to pay 20 percent initial deposit and they can spread the balance over the remaining number of months. This helps achieve ownership of the homes. For those that cannot afford the detached spaces tend to go for semi detached or the terraces”.

Bukola told Vanguard that because of the payment plan, the company has agreement with its customers that with every payment, there are milestones he or she is expected to see in the construction of the building. “When you don’t see those milestones you are not obligated to continue payment”.

With the spread payment plan, the intention of the company that is

building more estates in Ikota area of Lekki, of Lagos is to make more people buy and own their homes. “We are looking further to beyond the Ajah axis to construct more houses that are affordable for more income brackets”.

Explaining that when somebody deposits money for a house and one year after, he/she could not continue to pay, Bukola said “What we try to tell our clients is that as soon as there is an issue let us know. We are also human even though we are in business. If we understand what the issues are, we can give you some time frame to continue payment as long as it is within the time we have to deliver the estate. If you feel that the issue is beyond you and you might not continue we would help you sell the building and refund you”.

APRA conference holds in Nigeria

BY ANN NWAFOR

P

lans have been concluded for the 2016 edition of the African Public Relations Association, APRA conference in Nigeria.

The conference which is scheduled to hold in Calabar, Cross River state, between May 24 through 27, 2016, tagged; ‘Leapfrogging Africa: The Role of Communication’ will witness the convergence of Public Relations Associations and practitioners across the continent with a strong commitment to selling positive Africa in partnership with the Africa Union Commission, AUC. Speaking in Lagos, Secretary General of APRA, Mr. Yomi Badejo, said the Nigeria edition marks the identity unveiling of the forthcoming th 28 Edition of APRA, established to foster unity via interaction and exchange of ideas amongst public relations practitioners in Africa as a whole, and through communication, promote social, political and economic integration on the continent.

Samsung plans 16 one-stop shops by 2017

S

amsung Electronics says it plans to open 16 one-stopafter sales-service-centre where all challenges associated with its appliances will be solved, as it opens at Opebi, Lagos.

Speaking at the unveiling in Lagos, Chidera Ejiofor, Service Network Manager, Samsung Electronics West Africa, said, “basically why we have come here to set this up, even with one across the road is because this covers all products. This is the first one we have in Ikeja within the facility that covers all products and gives customers premium hospitality. Before now we have changed what the concept of what a service centre should be, service centre now looks as beautiful as it

should be.”

He said that the company plans to open 16 one-stopservice-centres, but with M-store, the Samsung plans to open eight service stores.

In addition, Head, Factory and Services Centre, M-store, a Samsung partner, Mr. Gagandeep Lakhanpal, said, there is plan to open eight additional one-stopstores by 2017.

“This is a centre where all the Samsung appliances are brought under one roof for after- salesservice. It’s a kind of a contact centre for our customers for all our appliances; no other service centre in Nigeria has this type of arrangement.

C M Y K

32 — Vanguard, MONDAY, MARCH 28, 2016

(0805 220 1997)

Economy: Buhari and CBN pulling apart T he National Assembly approved the 2016 Appropriation Bill, just a day before recess, on the rd Wednesday 23 of March; the approval was a fulfillment of the Appropriation Committees’ promise to do the needful before the Easter break.

However, the Senate Appropriation Committee’s Chairman, Danjuma Goje, acknowledged that the three months delay before implementation could have been avoided if the Budget was presented to the Legislature in good time.

The obvious lesson from Senator Goje’s observation is that, the budget consultations for 2017, should properly commence early, possibly in May this year, to allow for extensive and thorough deliberations, that will facilitate approval so that implementation st can commence on January 1 next year.

Nevertheless, some political leaders and financial experts and analysts have encouraged public perception that, once the budget is passed, the pressure from the present challenging economic environment would begin to diffuse. Regrettably, the minimal social impact of budget implementation in previous years, surely, do not justify any suggestion that the outcome of the 2016 version will be different. The recent revelations of the pervading, systemic monstrous rape of the Treasury, in the guise of budget implementation, probably explains why our nation’s fiscal plans failed, for several years, to significantly enhance social welfare.

Nevertheless, although Buhari’s 2016 budget may indeed be the highest ever, fiscal plan by any administration, in nominal terms; however, the 2013 N4.98tn budget with the

prevailing exchange rate of N160=$1 may actually be worth more in real terms. Thus, optical nominal escalation of budgets will not guarantee more social dividends if further Naira devaluation occurs.

So, ultimately, what are the assurances that the 2016 budget would succeed where others failed? Indeed, if truth be told, the early signals do not inspire much hope; arguably, no appropriation bill, in our history, has so embarrassed the sponsor as this year ’s plan.

Curiously, after the budget was lost, fiddled with, then found and corrected, it still remains unclear how the alleged padding and multiplicity of ‘doctored contents’ therein were satisfactorily eventually resolved within two weeks; incredibly, there were no reports for example, that the Minister of Health, or indeed any other MDA returned, as demanded by several Legislative Committees, to harmonise the controversial inputs identified in their budgets.

Curiously, the National Assembly obviously also saw nothing wrong in approving a budget, in which about N500bn (i.e. 8%) is set aside as intervention funds, without a clear strategic expenditure plan that will guide accountability, transparency and efficiency in the disbursement of funds. It is equally worrisome, that despite the collapse of crude oil prices and the troubling reality that we presently require 35kobo out of every Naira income to service existing debts, the Legislators paid little regard to endorsing substantial additional loans despite the oppressive interest rates required to fund the N2.2tn projected deficit.

Conversely, Buhari would have demonstrated an appropriate patriotic presidential concern that

generations to come will not become shackled by a crippling debt burden, if the 2016 projected deficit can be funded with the alleged, substantial recovered looted funds and the reported surplus funds consolidated from operating the Treasury Single Account, rather than the adoption of further debt accumulation to finance the deficit.

It is also bewildering nonetheless, that inspite of the several contentious issues surrounding the integrity of the 2016 bill, the National Assembly, only felt compelled, after presumed, diligent consideration, to reduce only N17bn from the liberal N6.08tn initially projected in Buhari’s plan.

Nonetheless, the high expenditure projection of N6.08tn has been lauded as a reflationary budget, inexplicably, at a time inflation

What are the assurances that the 2016 budget would succeed where others failed? Indeed, if truth be told, the early signals do not inspire much hope; arguably, no appropriation bill, in our history, has so embarrassed the sponsor as this year’s plan

price level, on March 22nd, a day just or so before the Legislature’s approval of budget 2016. Consequently, CBN raised the cost at which it would lend to commercial banks from 11% to 12%, and similarly raised the percentage of customers’ deposits that the banks must keep as reserves with the apex bank from 20% to 22%.

The object of these directives, is obviously to instigate commercial banks to also raise their interest rates on loans to their own customers; similarly, the increase in cash reserve ratio is also designed to reduce the amount of funds that banks can lend out to customers. So in a rather farcical twist, while Buhari is being commended for proposing to spend big in order to stimulate consumption and build infrastructures, the CBN, which alternately manages money supply and monetary policy is busy restricting access to loanable funds and infact ensuring that all borrowers, including the real sector, will become discouraged from seeking loans, when for example, it costs over 20% to Paradoxically, in order to compensate for this fauxpas, the CBN usually responds by compulsively creating and injecting intervention funds to special sectors. Regrettably, these intervention funds further compound an already excess money supply, and therefore inadvertently also instigate further inflationary push, which the CBN would again respond to by increasing its rate of borrowing with Treasury Bills, despite the attendant high interest paid on these idle deposits.

Ultimately, with Buhari and the CBN’s best intentions, the harsh economic times may remain for sometime.

Save the Naira, Save Nigerians!

is rising uncomfortably beyond 11%, i.e. well beyond CBN’s target of 9%, and certainly miles away from best practice rates below 2%, in successful economies everywhere.

Notwithstanding, some analysts have also suggested that the antidote to our economic condition is to spend our way out of poverty! Thus, according to this advocacy, more money must be made available to facilitate increase in public and private spending, even if we have to borrow or print more money to do so!

The above perspective invariably assumes that Nigeria’s economic downturn is the product of acute shortage of money; thus, making much more money available for spending should expectedly stimulate economic activity and create more jobs. Ironically, however, the CBN as the sole author of money supply in Nigeria, would beg to differ on this issue of the allegedly benign impact of excess money supply. Infact for decades, the CBN has engaged in an unending battle to reduce excess money supply from the system. Evidently, systemic excess money supply is actually the number one enemy against the achievement of CBN’s core mandate to ensure that the general price level does not rise above 2% annually, while cost of funds would also be kept at levels that would encourage and support boisterous inclusive economy. Regrettably, with inflation beyond 11% and cost of borrowing above 20%, the CBN has clearly failed in this pivotal constitutional mandate.

Incidentally, in response to the serious challenges posed by the present ‘oppressive’ level of money supply, the CBN’s MPC resolved, to tighten money supply to arrest further inflationary rise in the general

Business & Economy AACN has achieved increased visibility – Adewole

P

resident of the Association of Assets Custodians of Nigeria, (AACN), Mrs. Kemi Adewole has said that the Association has achieved increased market visibility in its few years of operation.

Adewole who disclosed this during the 2016 annual general meeting of the Association in Lagos, said that as a key securities market group, courtesy calls were made to the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele; Director General of the Securities and Exchange Commission (SEC), Mr. Mounir Gwarzo; as well as the CEOs of the Nigerian Stock Exchange (NSE) and the Central Securities Clearing Systems Plc (CSCS).

She said, “We achieved regular engagements with key market regulators on topical issues affecting the Nigerian securities market.

Improved collaboration with other Capital Market Operators (CMO) groups, The C M Y K

Association has developed a working relationship with other CMO groups. The successful hosting of the 4th Annual Investor Conference that was held in London, UK was adjudged the best so far in terms of recorded participants, quality of speakers and the issues discussed.”

The six member institutions of the Association were ably represented at the annual general meeting.

Adewole stated that the tenure of the current leadership of the Association commenced after the 2nd annual general meeting held in 2014.

At the end of the meeting, Adewole announced that she was stepping down as the President of the Association and the office was ceded to Mrs. Taiwo Sonola who was until then a Vice President of the association. Taiwo will act as the president of the Association until the next election.

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