economy: stakeholders list options for buhari

CMYK

APRIL 6, 2015

Continues on page 22

Business executives andsectoral groups in theeconomy have made a list of

23 recommendations to the President-elect, Major General Buhari (retd) onthe management of the economy underhis administration.

Speaking to Financial Vanguard inseparate interviews, the stakeholderscomprisingoperatorsin thecapitalmarket,

By BABAJIDE KOMOLAFE,PETER EGWUATU, FRANKLINALLI, GODWIN ORITSE,ROSEMARY ONUOHA, NAOMIUZOR & JONAH NWOKPOKU

industry, maritime, insurance, trade andindustry, e-business and advertisingadvised the President-elect to start fromwhere his predecessor stopped andbuild on its achievements.

The recommendations are as followson sector by sector basis.

Capital MarketCapital market operators called on the

incoming government, to address theinfrastructural gaps in the economy byusing capital market instruments.

The operators said, “The capitalmarket can finance the entireinfrastructural gaps if the governmentcan deploy fiscal incentives to deepen

the market by

encouraging the companies in thetelecoms, power and aviation and oiland gas sectors of the economy to getlisted on the securities market.

The coalition of capital marketoperators under the aegis of the capitalmarket alliance, which comprises AlbertOkumagba, President CharteredInstitute of Stockbrokers, CIS, Mr.Emeka Madubuike, Chairman,Association of Stockbroking Houses ofNigeria, ASHON and Mr. VictorOgiemwonyi, Chairman, Association ofIssuing Houses of Nigeria, AIHNnoted that, “At present, the Nigeriancapital market is underutilized relativeto its a b s o r p t i v e

c a p a c i t y .Therefore, theF e d e r a lGovernment’s

goal ofdiversificationof the

economywould be

reinforcedif the capital

market isdeepened to enable

it fund the capitalexpenditure over the

short term to mediumterm period.Speaking, Okumagba

said, “The core capitalmarket operators shouldwork with the regulators to

come with pragmatictimetable which will be

endorsed by the FederalGovernment for the

commencement of viablecommodity exchanges which are

either privately owned orgovernment owned. The commodity

market should be developed in such away to provide underlying instrumentson which other structured products inthe financial market can be developedto increase the number of tradableinstruments in the capital market. Forinstance, futures, options and other

derivative instrument on the underlyingassets available in the commoditymarket.”

He further stated that promotion ofnational savings is better achievedthrough comprehensive review of therules and regulations guiding theCollective Investment Scheme, CIS.

“In the same vein, there is a need toamend all clauses that are affecting theoperations of the Pension Commission,to ensure its developmental impact onactivities in the capital market,” headded.

Suggesting how to attract companiesto get listed on the Exchange, Mr.Madubuike said, “Incentives should begiven to listed companies andprospective companies to be listed soas to have some advantage overunlisted companies. We propose sometax incentives for listed companies andthose that are in the process of gettinglisted.”

Continuing, he said, “Policies thatwould promote marketability ofagricultural products should beenunciated and implemented to boostoperations of the commoditiesexchanges. Also governments at thehighest level must continue to makepositive statements and assurances thatwill engender investors’ confidence.”

In his own comment, Mr.Ogiemwonyi said, “Governmentborrowing rate in the capital marketshould drop to avoid crowding out offunds in the capital market so as to makethe market attractive for private sectorto raise funds. We are ready to supportthe Federal Government in advisorycapacity at any time the need arises onhow the capital market can be fullyutilized to drive economic growth anddevelopment in Nigeria.”

He further stated that the FederalGovernment should accord regulatorysupport to the two existing Over-theCounter, OTC Markets- NationalAssociation of Securities Dealers(NASD) and FMDQ platform to

Economy: Stakeholders listoptions for Buhari

CMYK

22 — Vanguard, MONDAY, APRIL 6, 2015

Cover Story


Continues from page 21

VOCATION AND TECHNICALEDUCATION – A KEY TO IMPROVINGNIGERIA’S DEVELOPMENT. PART 5

As the RomanHistorian, Plutarch(AD 46-120?) had

noted “The mind is not avessel to be filled but a fireto be kindled.” Given theircorrupt and greedylifestyles Nigeria’s leadersdo not seem to care aboutintegrity or moral values.They are good at predictingthe future without creatingit. As Peter Drucker hasobserved “If you want topredict the future, createit.”

In Nigeria, the growingproblem of unemployment inthe country has contributedlargely to the worseningproblem of poverty amongthe populace.Unemployment according toOlaitan (1996) leads tofrustration anddisillusionment which mayresult in crime or drug abusein a futile attempt to escapefrom and forget the painsand humiliation of povertyand lack. The problem ofunemployment, he furtherstated, has worsened asmillions of school leaversand graduates of tertiaryinstitutions have notsecured gainful employmentover the years.Unemployment has posed aserious problem not only tothe welfare of individuals butalso to that of their families.Many able bodied andhighly qualified personswho could not secure gainfulemployment have remainedeconomically dependent ontheir parents. This isbecause they lack thenecessary occupationalskills to be self employedand to effectively function intoday’s world of work. Theseoccupational skills can beprovided by technical andvocational education.According to Abdulahi(1994) technical education isthat aspect of education thatinvolves the acquisition oftechniques and applicationof the knowledge of thescience for the improvementof man’s surrounding.

Technical and vocationaleducation prepares one forthe world of work with whichthe individual becomereliant and can makecontributions to thedevelopment of the society.As employers look for new

talents every year from newgraduates, it is important tonot only have a solideducation but graduates thathave features that stand outfrom the rest of thegraduating students. Withthe economy being moreglobalized than ever, it isimportant to have abackground and a skill setthat allows graduates tobecome immersed in theglobal economy right fromgraduation (Cote, 2007). Itis important for thesestudents or graduates tohave skills in innovation intechnology education andentrepreneurship to beready to fit into the globalmarket place on whichtoday’s economy dependson. Entrepreneurial SkillsNeeded by Technical and

Vocational Education.Leadership is not a major

cause of Nigeria’s under-developed status. Nigeriacan become an economicpower-house (and realize itsvisions) only if properattention is given toeducation and technologicaldevelopment and promotesand rewards creativity, andchannel its material andhuman resources toproductive use. The leadersmust recognize the relevanceof technical and vocationaleducation in nationaldevelopment and adopt andadapt what works indeveloped nations. Theresources being wasted inthe on-going false re-branding campaign shouldhave been used to re-brandthe nation’s educationsector. No amount of rhetoric(or fanciful slogan) wouldsolve Nigeria’s socio-political and economicproblems.


enhance expansion of theiroperations in the financialmarket.

Trade and Industry

The Lagos Chamber ofCommerce and Industry,

LCCI on its part, urged theincoming government toensure acceleration of reformson the Oil and Gas sector inorder to attract more privateinvestments in both theupstream and downstreamsegments of the sector.

Reacting to the implicationsof Buhari’s election for theeconomy, the Chamber in acommuniqué signed by itsPresident, Alhaji Remi Bello,commended the President-elect, Mohammadu Buhari, forhis victory and PresidentGoodluck Jonathan, for hisdemonstration ofstatesmanship and nobility.

The LCCI urged theincoming administration toensure acceleration of reformson the Oil and Gas sector inorder to attract more privateinvestments in both theupstream and downstreamsegments of the sector, as thiswould save the economy thecurrent huge foreign exchangeused for importation ofpetroleum products.

“Ensure the blocking of allfiscal leakages and wastes inGovernment, especially inrespect of the management ofpetroleum products subsidy,immediate review of JTFactivities in the Niger Deltaarea where revenue is beinglost daily due to oil theft,pension funds, import dutywaivers, ghost workers in theMDAs, Service Wide Votes and

crude oil theft. Prioritisegovernment expenditure toboost investments in criticalinfrastructure. Address thechallenge of high cost ofgovernance, collapse of the railsystem, poor power supply alsodemand urgent attention,” hesaid.

He said the chamber urgesthe incoming administration toaddress the fundamental of thehigh cost of doing businessand low productivity whichcould be ascribed tomacroeconomic factors,institutional challenges andstructural issues, adding that,there is need to sustain themomentum of the war onterrorism and insurgency inparts of the country.

“Ensure a level playing fieldfor all investors across allsectors with regard to importtariffs, funding opportunities,tax incentives etc. Ensure thesustainability of selectedpolicies and programmes of thepresent administration which

currently offer value to theeconomy. Ensure robustconsultation with the PrivateSector bodies for inputs intopolicy formulation processes.Improve the scope and depthof financial intermediation forthe benefit of all investors inthe economy irrespective ofsize. Guidelines for accessingintervention funds should bereviewed and made lessstringent. Investmentincentives should be ofuniversal application to allinvestors in a given sector,” hestated.

He said the Council urges allaggrieved candidates in theelectoral process to channeltheir grievances throughappropriate channels inaccordance with the electorallaw, stressing that, peace andtranquillity is paramount forthe progress of any economy,and any society for that matter.

According to him, thechamber also wants the newadministration, to give attentionto the plummeting oil priceand the impact on the fiscaloutlook present a significantchallenge to the incomingadministration.

“It is therefore critical tomanage expectations at thistime. The outlook for manymacroeconomic indicators isnot bright with foreign reservesdropping below $30 billion andpersistent pressure on thenaira exchange rate.Meanwhile, the success of thepresidential election willdefinitely mitigate the anxietyand uncertainty thatcharacterised the businessenvironment before theelections. Investors’ confidencewill be positively impacted bythese developments,” he said.

PRESENTATION - From left: Mezuo Nwuneli, Managing Director, SAHEL Capital; RasheedOlaoluwa, MD/CEO, Bank of Industry; Adedoyin Odunfa, MD/CEO, Digital Jewel Ltd; JimiAgbaje, PDP gubernatorial candidate, Lagos State/guest speaker; Opeyemi Agbaje, author ofthe book “ Democracy without Democrats and Uncomplex Strategy” and Tosin Runsewe, chiefclient officer/Group CEO, Mansard Group, during a lecturer and book presentations in honourof Opeyemi in Lagos on 02/04/2015. PHOTO: AKEEM SALAU

Improve thescope anddepth offinancialintermediationfor the benefitof all investorsin theeconomyirrespective ofsize

Technical andvocationaleducationprepares one forthe world of workwith which theindividualbecome reliantand can makecontributions tothe developmentof the society

Vanguard, MONDAY, APRIL 6, 2015 — 23

Cover

CMYK

Continues from page 22 Economy: Stakeholders list options forBuhariMaritime

National President,Association of NigerianLicensed Customs Agents(ANLCA), Prince OlayiwolaShittu, also called on theincoming government to lookinto reports of variouscommittees set up by thecurrent administration insteadof setting up new ones.

He said, “All the reports of allthe committees that have beenpiling dust, whether seen orunseen but without any actiontaking place should be lookedinto. It is not a matter of settingup further committees but theyshould look at previouscommittees.”

Shittu also expressed hopethat the Buhari administrationwould review theimplementation of thecontroversial nationalautomotive policy.

Founder of the National

Association of GovernmentApproved Freight Forwarders(NAGAFF), Dr. BonifaceAniebonam, on his part saidBuhari’s emergence asPresident-elect clearly showedthe desire for a differentapproach to governance byNigerians.

He said, “What is happeningin Nigeria is not about Buharibut a march towards sustainabledemocracy in Nigeria.

“It is not about Buhari, it isnot about Goodluck . It is aboutgood governance in Nigeria, itis about Nigerians becomingcritically aware of theirenvironment, economy andtheir well being.

“From what we have seen now,we can see that Nigerians areconsciously and deliberately

becoming very very interestedin what happens around them.The emphasis right now shouldbe sustainable attack on theissues of corruption.

“What should we do to stemcorruption in Nigeria as thecankerworm and what I willsay to Nigeria is that it is notthat Buhari is an angel but it isthe perception that people haveabout him with an intent toreally stamp out corruption inNigeria.”

Chairman, Association ofRegistered Freight Forwarders(AREFF), Dr. Frank Ukor washowever unhappy with theoutcome of the election.

He however called on the AllProgressives Congress and thenewly elected president,General Muhamadu Buhari tofocus more attention on themaritime sector because of itsimportance to the economy.

“We expected the newPresident to pay attention to the

maritime industry because thatis the second highest revenueyielder. I hope the people therewill not steal all the money,” hesaid.

E-Commerce

The President/CEOShoptomydoor.com, an

international online shop,Nduka Udeh said thePresident-elect must throughhis anti corruption stance, bringmore transparency into thebusiness landscape in order todrive foreign direct investment.

He said: “While it is still tooearly to see and know what thefuture holds for the economyuntil the incoming presidentlays out his economic agenda,foreign investors are typically


•Tunji Olugbodi, ManagingDirector, verdant Zeal

campaign like others.He simply went to the library

and took stock of the seatsavailable in the library. He didthe same for Hostelaccommodation and thecafeteria then. What he didnext was to ask from theauthorities the number ofstudents in the school andwhat was the ideal facilities thestudents were supposed tohave in the variousinfrastructure name above. Hegot the data and was armed forthe manifesto night.

When it was his turn tospeak, Tella just told thestudent body number of seatsin the library and how manywere supposed to be there, hesaid the same of the hostelaccommodation, the cafeteriaand what the students weremissing by the university notproviding adequate facilitiesfor them to study without tears.Before he finished, the manwho no body gave a chancewas endorsed by all thestudents with a chat, Tella, youhave won, Tella you have won.

I decided to reflect on thisexperience in my student daysbased on the hollow nature ofthe electioneering campaignsgoing on in the 2015 bid forthe various elective post.Nigeria politicians have leftthe substance and chasingshadow with our country menlooking helpless. Thesepoliticians are not making anymeasurable promise to theelectorate. They are just

PDP, APC your promisesare vague

During the student union election in 1979/80 at the University of Benin, oneLiad Tella, who was of the economic and Statistic department thought the

university community how sacred facts can and how effective statistic can beused for electioneering campaign.

Talla entered the race for the student union election to the office of Studentwelfare two weeks to the election. When he announced his candidacy to theclass, he was taken as a joker. He neither printed posters nor embark on elaborate

dancing naked to amuse theelectorate.

Each time they mount therostrum they speak vague andfoul language devoid of factsand figure. There is no newidea of how to deal with theeconomic and social problemsthat have plagued the nation.I will deal with corruption.What is the level of corruptionyou plan to deal with? In whatsector, arm of government doyou have this high level ofcorruption, how much isNigeria losing per year due tocorruption. The parties havenot conducted any study, theyhave no idea how much isbeing lost and how to block theloopholes. What are the newplans to deal with corruption,Nigerians are not being toldyet we clap our hands forvague speeches made on soapbox.

Nigerians know that themajor development challengesfacing the country today arecorruption, insecurity,economy that isunemployment/poverty, power,infrastructure, etc; health andeducation. The ongoingcampaign shows that the twopolitical parties do not

understand the depth of theeconomic problem facing thecountry. They both have nocredible agenda to deal withthe issues, especially withinthe context of the evolvingglobal economy and Nigeria’sbroken public finance.

A look at what happens inother part of democratic world,Party and leaders who do theirhome work usually come upwith policy framework whereprogrammes and policies theyintend to pursue ie Partymanifesto are fully costed andstrategies to finance andimplement them are spelt out.

Neither APC nor PDP canmake such claim. To anyEconomist any plan without thecost outlay is nothing but awish-list. They are not tellingus how much each of theirpromises will cost and wherethey will get the money. Nonetalks about the broken or nearbankrupt public finance andthe strategy to fix it.

Each talks about agriculturalrevolution, what type ofagriculture are we planning toimplement? What are the valuechains the agric policy willpursue? What light industriesare coming on stream andwhere are they to be located?Who are how they to befinanced are? What is the costestimate for such projects?How many jobs are to becreated from the sector perannum? These are questionsthat they are avoiding toanswer. What is the exportstrategy for the surplus thatwill be created forminvestment in agriculture?Which market is Nigeriatargeting for export? And whatplans are in their manifesto tofree Nigeria from dependenceon import especially petroleumimports in order to save the

naira from continueddevaluation?

In response to the questionof where the money will comefrom, some Nigerians,journalist inclusive are quickto say that the problem ofNigeria is not money but themanagement of resources. Thisis far from the truth. To deliveran efficient national transportinfrastructure alone accordingavailable estimate will cost$3.05 trillion per in the next 30years about $25 billion perannum even by corruption-free, cost-effective meansestimated by NationalEconomic Council.

These politicians should stoplying to Nigerians and tell thenation how both parties wouldfund their programmes. Thiscrop of new generationpoliticians should learn alesson from Chief ObafemiAwolowo who was asked in1978 and 1979 electioneeringcampaign about his promisesof free education and freemedical services.

He, Awolowo always reeledout figures about the amountshe would save from various‘ waste’ including the tea/coffee served in governmentoffices. The issue here is thathe would always do hishomework before making anypronouncement. Evidently,from what the two majorpolitical parties are offering itdoes not seem that they areoffering Nigerians any seriousdeal.

There is no newidea of how todeal with theeconomic andsocial problemsthat haveplagued thenation


CMYK

Business & Economy

The Institute ofC h a r t e r e d

Accountants of Nigeriahas been appointed by theInternational Federationof Accountants (IFAC) toprovide capacity buildingservices to ProfessionalA c c o u n t a n c yOrganizations (PAOs)under a programmefunded by the UKDepartment ofI n t e r n a t i o n a lDevelopment (DFID).

Under this programme,DFID will provide £4.935million to IFAC overseven years to be used tostrengthen PAOs in atleast 10 DFID focal

Dangote, Saipem, seal jointventure agreement in Central,West Africa

Dangote IndustriesLimited has entered

into a multi-million dollarJoint Venture agreementwith Saipem, the Italianengineering andconstruction giant that willoperate in Nigeria, Centraland West Africa markets.

The agreement has givenbirth to a new companynamed Saipem-DangoteE&C.

According to a statementfrom Dangote Group, the

company, Saipem-DangoteE&C is a significant newplayer in the Nigerian ,

Central and West Africanmarket, with high technicaland financial capabilities.

The statement quotedGroup Executive Director,Dangote Group, Mr.Devakumar Edwin as sayingthat the new company aimsto secure complexEngineering andConstruction projects and toexecute them at the highestlevels of efficiency in termsof costs and timing, whilemaintaining sufficientflexibility to adapt to differentproject requirements.

Saipem and Dangote Grouphave a track record ofsuccessful collaboration,drawing on the strengthsand competences of bothCompanies. Dangote’sfinancial strength, expertiseand standing in the Sub–Saharan African market willcomplement Saipem’sunique capabilities in E & C.

This new partnershipconfirms the sharedcommitment of the twogroups to both the Nigerianmarket and sub-SaharanAfrica more widely.

Edwin, said “We areconfident that ourpartnership with Saipem willposition us as a major playerin the oil & gas sector.Dangote’s financial strength,expertise and standing inthe sub–Saharan Africanmarket will complementSaipem’s unique capabilitiesin E & C in developing newbusiness. Saipem values thesatisfaction of its clients inthe energy industry, tacklingeach challenge with safe,reliable and innovativesolutions. DangoteIndustries and Saipem shallgain mutual benefit from thispartnership”.

Saipem Central AfricaRegional Manager GiuseppeSurace said: “thecombination of twoexcellences like Saipem andDangote in Central Africacreates a new efficient andsustainable way of workingalong the whole valuechain.”

Dangote Group is one ofAfrica’s largest industrialconglomerates. It has been akey investor in the Nigerianeconomy for a number ofyears, and is seeking to helpthe country create a moreefficient industrial andenergy infrastructures, viastrategic investments in anumber of upstream oil andgas projects.

ICAN appointed IFAC capacity building partnercountries to enable them playa greater role in furtheringeconomic development intheir various Countries.

Much of the work ICAN willdo in this regard will be incountries where DFID isattempting to reduce extremepoverty. ICAN would providetechnical assistance, trainingand mentoring to professionalaccountancy bodies in severalcountries in Africa andbeyond to enable themestablish and run their ownProfessional AccountancyInstitutes.

This new IFAC/DFIDmandate is an addition to theinstitute’s current mentoringrole in Cameroon where it is

helping to train and providetechnical assistance to theCameroonian Institute.(Ordre National des Expertscomptables du Cameroun-ONECCA)

ICAN is empowered to setstandards of knowledge andskills to be attained bypersons seeking to becomemembers of the Accountancyprofession in Nigeria.

The Institute has more than39,000 members and 120,000students on its registers andconducts professionalexaminations twice in a year.

ICAN members holdsensitive positions in strategicmanagement in different local

and multinational firms,home and abroad and alsoserve the public sector indifferent capacities.

Its vision is to be a leadingglobal professional bodywhile its mission is toproduce world-classChartered Accountants,regulate and continuouslyenhance their ethicalstandards and technicalcompetence in the publicinterest.

The Institute is engaged inbroadening the frontiers ofthe profession in Africa bymentoring sister professionalaccountancy bodies forinternational recognition.

CIMA Globalbusinesschallenge nowin NigeriaBY PRINCEWILLEKWUJURU

CIMA, the CharteredInstitute of

Management Accountantshas invited entries fromundergraduates inuniversities, polytechnicsand monotechnics acrossNigeria to participate in thisyear ’s CIMA GlobalBusiness Challenge (GBC).The GBC is an internationalbusiness competition hostedin conjunction with Barclaysacross 26 countries. This isthe first time that Nigeriawill compete in this prestigecompetition which allowsundergraduates theopportunity to test their skillsand showcase their talent.

National winning teamswill travel to Warsaw,Poland, in August tocompete in the global finalfor the title of GBC GlobalWinners. CIMA offers aninternational qualification inmanagement accountancyand is the world’s leadingand largest professionalbody of managementaccountants with over227000 members andstudents in 179 countries.

Full-time undergraduatestudents with a passion forbusiness and finance areinvited to register for theNigeria GBC challenge by17 April. Teams of fourregister online atwww.cimaglobal.com. Teamsof four compete by analysinga case study based onCIMA’s test of professionalcompetence and submittinga 3000 word report by 28April. Once reports aresubmitted and assessed, fourteams are selected and thefinal short-list will beannounced.

These teams are invited toparticipate in the Nigeriafinal in Lagos on 30 May2015.Commenting on the2015 GBC, Ijeoma Anadozie,Country Manager, CIMAsaid: “The Global BusinessChallenge is aninternationally acclaimedplatform which helpsstudents exhibit theknowledge, skills andcompetency needed to makethem future businessleaders, while giving thema unique opportunity to testtheir analytical skillsrevolving around businessand financial management.

By PETER EGWUATU

Saipem andDangote Grouphave a trackrecord ofsuccessfulcollaboration

INVESTITURE - From left: Newly conferred fellows - Commercial Director, Promasidor, Kachi Onugbogu; Vice President, National institute of Marketing of Nigeria, Rotimi Olaniyan;West Africa Managing Director, Kimberly Clark , Mrs Lola Daniels; and Managing Director,PZ-Healthcare, Mr. Alex Goma , at the National Institute of Marketing of Nigeria Investitureceremony in Lagos


Homes & Housing

Nigeria attractNigeria attractNigeria attractNigeria attractNigeria attracted N780bn real estated N780bn real estated N780bn real estated N780bn real estated N780bn real estateeeeeinininininvvvvvestment in 20estment in 20estment in 20estment in 20estment in 201111144444

By YINKA KOLAWOLE,with agency report

Nigeria attracted $3.96billion (about N780.12

billion) on real estatedevelopment in 2014, which is11 percent of the total sum of$36.4 billion expended oninfrastructure constructionprojects in the country.

Data recently released byDeloitte African ConstructionTrends report placed Nigeriaat the top of West Africancountries in majorinfrastructure constructionprojects in 2014, with thecountry spending $36.4 billionon major infrastructureconstruction projects for theyear 2014. The totalexpenditure includes bothforeign and local as well aspublic and private sectorinvestment.

Investment has been on therise following the re-basing ofthe country’s gross domesticproduct (GDP) to $509.9 billionin April 2014. According to thereport, the projects range fromWater which took 39 percent,Energy and Power (17percent), Oil and gas (17 per-cent), Transport (15 percent),Real Estate (11 percent) andManufacturing (1 percent).

“Whereas South Africa waspreviously the choice marketin Africa for scalableoperations, Nigeria now has amore attractive profile, offeringscale and strong growth,”Deloitte said in the report. Yetthe country faces some loftyhurdles if it is to realise itsrequired infrastructuredevelopments.”

The report noted that WestAfrica exhibited a strong levelof growth with the total valueof projects under constructionincreasing from $50 billion to$75 billion year-on-year,although there was no changein the number of projectsqualifying for the report thisyear. Although the region stillaccounts for just half of thelevel of investment inSouthern Africa, it is startingto close the gap, consistentwith Nigeria’s new title as thebiggest economy in Africa.

Deloitte further noted thatSouth Africa has significantlymore value in projects underconstruction or developmentthan Nigeria does, showingthat while a market may havescale and growth, it also needsa stable business environment,which Nigeria struggles with.

According to the report,reforms and developmentplans implemented by theNigerian government are

beginning to take effect, withthe privatisation of the state-run Power Holding Companyof Nigeria virtually completeand an increasing number ofPublic Private Partnerships(PPPs) entering the market.

There is also significantactivity underway in Lagos(the commercial capital),which accounts for more than60 percent of non-oil GDP.“Some of the more noteworthymoves in the country havebeen the breaking ground ona second Niger Bridge. Itcould boost the Nigerianconstruction industry,improving East-West trade andhelping to progress thenascent PPP model,” the

report said. The transportsector where Chinesecompanies dominate couldalso emerge as one of thestrongest sources of growth

for the Nigerian constructionindustry over the mediumterm, according to Deloitte.

Two projects thatdemonstrate such dominanceare the $1.49 billion Lagos toIbadan railway contract, whichhas been awarded to ChinaCivil EngineeringConstruction Corporation(CCECC), and the OlokolaDeepwater port project,awarded to the China OceanShipping Group. Othernoteworthy projects are theBonga NW Project, EkoAtlantic City, Lagos Light Rail,Abuja Light Rail in the FederalCapital Territory and AbujaCentenary City.

Whereas SouthAfrica waspreviously thechoice market inAfrica for scalableoperations,Nigeria now has amore attractiveprofile, offeringscale and stronggrowth

Yaba College ofT e c h n o l o g y

(YABATECH) in Lagos said itwould float a mortgage bank,to train the students onindustrialisation.

Head, Public Relations Unit,YABATECH, Mr Charles Oni,told the News Agency ofNigeria (NAN) in Lagos thatthe capital deposit had beenpaid to the Central Bank ofNigeria (CBN). He said thatthe bank would provide an all-encompassing training andwould also be used for thecollection of tuitions fees.

“The process is ongoingnow; once we get the CBN’snod, we will float it. So manymembers of staff are investors;shares were sold to staff, so

YABATECH floats mortgage bank

that they can be part of theventure. We publicised theavailability of shares overtime and as at today, thecapital outlay has beenperfected. And all that is beingawaited now is the CBN’snod, to ensure that the bankoperates as required,” Onisaid.

He said the college had putin place a Banking andFinance Department, tohandle the bank and to alsotrain the students. Oni saidthat the college wasintroducing the bank toprovide comprehensiveknowledge for students onhow to go intoindustrialisation, production,marketing and banking.

“Presently, students pay alltheir fees online; the BursaryStaff do not handle cash anymore. Everything is doneonline; so, the bank will helpin the collection of fees. Thebank will be situated withinthe college, and a site has beenlocated for the project.Technically, YABATECH isready for the take- off of thebank,” he said.

Oni said the bank would beable to sustain itself andwould also serve as anadditional revenue earner forthe institution. “The originalconcept is that it will be usedas a training platform forstudents in the Banking andFinance Department,” headded.

FG laments highconstruction cost

Minister of Lands,Housing and Urban

Development, Mrs. AkonEyakenyi, has said thatgovernment is worried withthe cost of construction inNigeria which ranks amongthe highest in the world.

She challenged quantitysurveyors to help redress thetrend, noting that they havea big role to play in findingsolutions to it. “QuantitySurveyors indeed hold thekey to unravelling the mysterybehind high project costs,especially those ones notderived from inflationaryfactors within the economybut which arise from factorsother than market forces. Takefor instance, the commonpractice whereby contractorsattempt to mitigate perceivedrisks associated with projectsfor which they are bidding bytranslating those risks intomonetary values which areinvariably transferred to theoverall project costs. Some ofsuch risks include design,funding, high interest rate,security, foreign exchange,fluctuation etc. All these riskshave huge impact on the costof projects in Nigeria,” shesaid.The minister said that atemplate has to be designedfor determining cost bandsand ranges for various typesof projects so as to instilsanity in the planning andpreparation of capitalbudgets.

US mortgageapplications surgeon spring demand

Despite volatility ininterest rates, mortgage

applications moved decidedlyhigher last week, continuingtheir strong stride into spring.

Total volume increased 4.6percent sequentially, on aseasonally adjusted basis forthe week ending March 27,according to the MortgageBankers Association (MBA).

“This week’s mortgageapplication survey falls rightinto line with recentindications that home sales –new, existing and pending –are on the rise, as is consumersentiment,” said Lynn Fisher,MBA’s Vice President ofresearch and economics.”

Mortgage applications topurchase a home rose 6 percentweek to week and were 8percent higher than one yearago. Applications to refinance,which are more dependent oninterest rate levels, rose 4percent for the week and are44 percent higher than theywere one year ago.

Mass housing development


Banking & Finance

WORKSHOP - From left: Mrs. Peju Ibekwe, Head, Brands, Sterling Bank Plc; Miss. AdeolaAlli, Head Education Unit, Sterling Bank Plc; Dr. Dolapo Ogunbanwo, Executive Director,Caleb Group of Schools and Mrs. Folasade Abiola of Financial Institution Training Centre atthe Parenting Workshop organized by Caleb Group of Schools in collaboration with SterlingBank Plc.

Business organisationsneed leadership that is

audacious, innovative anddiligent in order to succeedin the increasing competitiveenvironment, said a panel ofchief executives.

The panel comprisedRasheed Olaoluwa,Managing Director/CEO,Bank of Industry, TosinRunsewe, Chief ClientOfficer/Group CEO, MansardGroup of Companies,Adedoyin Odunfa, Mnaging

Audacious, innovative leadershipcrucial to business success — CEOs

By BABAJIDEKOMOLAFE

Director/Chief Executive,Digital Jewels Limited andMezuo Nwuneli, Managing

Director, Sahel Capital/AACEFoods Limited.

They spoke on BusinessStrategy in Nigeria, duringthe presentation of two books,“Uncomplex Strategy” and“Democracy withoutDemocrats” written by Mr.Opeyemi Agbaje, ChiefExecutive Officer of RTCAdvisory Services Limited.

Speaking on the importanceof leadership for businesssuccess, Runsewe, said,“Leadership from the contextof vision, understandingwhere the business is goingto be headed and how to get

there, and what resources areneeded to take the companyfrom point A to point B, andwhy it is important to go inthe direction of point B andnot point C to another."

Olaowlu however pointedout that leadership must haveaudacious vision and bediligent in executing thevision. He said, “There is aneed for audacity. Businessesthat succeeded have beenvery bold in terms of how theyset their vision. And you needto have a vision that somepeople consider unrealistictoday but because you believein that vision, you worktowards it seriously and it isachieved. The other one thatcomes behind it is ability toexecute. Everybody knowswhat to do but the problem isactually doing it, and that iswhy execution is veryimportant. You must be ableto roll up your sleeves andmove everybody in theorganisation towardsattainment of that vision, orthat audacious goal you haveset for the business.

Speaking from theperspective of an investor inthe agricultural sector, Mezuoidentified passion andproximity to the business ascritical success factors in theagricultural sector. He said,“One thing we need to see ispassion from themanagement team. We needto see them excited andpassionate about thebusinesse.

"We also need to see a desireand willingness to stay closeto the business. This isessentially critical in ourspace because you have asituation where the capital isin Lagos, or the urbancenters, and the businessesare in the small towns or thevillages. So if you are themanaging director of anagribusiness and you aresitting in Lagos, it is notgoing to happen. Whereveryour business is, you have tomake sure the entrepreneuris there, he is monitoring thebusiness to minimiseleakages, he is helping theteam and helping to addvalue.”

Odunfa on her part notedthat adoption of technologyand innovation has played akey role in the success ofbusinesses in the lastdecade and would continueto do so. She said in additionto these, is the need to masterthe operating environmentand understand the securityrisks of technology.

The Agricultural sector received a majorboost at the weekend as Sterling Bank

Plc restated its commitment to the strategicgrowth of the Sector by increasing the proportionof loans allocated to it from the total loansearmarked for disbursement to various sectorsof the economy from five percent to 10 percentin 2015.

The Bank will also be willing to partner withmajor stakeholders – both private andgovernment in the sector to ensure that farmersbegin to see agriculture more as a business.

Speaking at the 2015 Conference organizedby the International Institute of TropicalAgriculture (IITA) in collaboration with theInternational Association of Research Scholars& Fellows (IARSAF), the Bank’s Group Head,Agric Finance, Mrs. Bukola Awosanya statedthat the five percent allocated to the sector in2014 was fully disbursed to the various subsectors across the value chain for the financingof various projects nationwide.

Mrs. Awosanya who disclosed that the Bankis a major financier of one of the largest ricemills in Nigeria as well as a state of the artsoya bean oil milling plant, stated that the Bank

Sterling Bank boosts agricultural sectorwith increased funding

had also provided fund to finance poultrybusinesses.

Mrs. Awosanya who also led a delegationfrom the Bank to the Deputy Director General,Partnership and Capacity Development ofIITA, Dr. Kenton Dashiell said that thedecision of the Bank was informed by the needto provide adequate funding in alignmentwith the on-going reforms in the sector aimedat repositioning it as an attractive businessproposition, an input provider for themanufacturing sector and a key foreignexchange earner for the country.

The president of IARSAF, Mrs. BunmiIbitoye who commended the Bank for itscontribution to the growth of the sector inNigeria called on other corporate bodies toemulate Sterling Bank by providing funds tosupport research works being carried out byprofessionals in the field to solve major issuesconfronting the sector.

Mrs. Ibitoye also urged banks to encouragethe sector by granting loans to small farmersat affordable interest rates which “today standsas a major problem confronting operatorsespecially start -ups”.

Skye Bank buildscapacity for MSMEsfor economic growthAs part of its efforts to

strengthen andempower the micro, small andmedium enterprise (MSMEs) businesses in thecountry, Skye Bank Plc is tocommence a series of capacitybuilding workshops andseminars in some prioritysectors for owners of smalland medium scale businesses.

According to a releaseissued by the bank, theobjective of the seminar seriesis to empower the MSMEs forgrowth by providing insightsinto common issues whichaffect their operations, namelymanagement, operations andfinance.

The statement further said bybridging the identified skill-gaps, the entrepreneurs canbecome sufficiently scalable tocontribute to the developmentof the economy, especially inthe area of employmentgeneration.

“For Skye Bank, theempowerment programme isa strategic scheme whichforms part of the delivery ofits SME banking promisewhich is to nurture businessesfor growth”. The maidenedition of the Skye BusinessSeminar Series is focused ontwo sectors ie generalcommerce and manufacturingand is scheduled to take placein Onitsha on April 16, 2015,and monthly thereafter. Aspart of the value adds for theMSMEs, we have partneredother stakeholders such asBusiness DevelopmentSupport Providers, the Bankof Industry, ComputerWarehouse Group andMicrosoft”, the statementsaid.

According to the bank, theseminars would also providenetworking opportunities forthe entrepreneurs, with thebenefits expected to be reapedin many folds.

The statement explained thatSkye Bank has been appointedby the Central Bank ofNigeria as one of the banks todisburse the N220BN MSMEFund, adding that the bankwas in strategic partnershipwith other DevelopmentFinance Institutions toprovide affordable financingover a long term.

Beyond financing, the bankis introducing a best in classbusiness account withcompelling benefits toMSMEs such as reducedbank charges (free chequebook, free debit cards); flexibleoptions; discounted pricing onloans and much more.


Banking & Finance

AfDB presents RegionalIntegration IndexThe African Development

Bank (AfDB), the AfricanUnion Commission (AUC) andthe Economic Commission forAfrica (ECA), has presentedpreliminary data on thecontinent’s RegionalIntegration Index to the 8th AU-ECA Conference of Ministers.

The meeting focused onprogress made on Africa’sRegional Integration Index.The Africa Regional IntegrationIndex is the boldest attempt todate to collect data on theimpacts of regional integrationin Africa.

The initiative is funded by theAfDB’s Africa Trade Fund ,ECA’s African Trade PolicyCentre, the African Centre forStatistics, and the AUC.

To meet their goal, the threeinstitutions collected data on 28indicators for almost the entirecontinent. Data on some 50indicators for seven pilotcountries were collected as well,and national statistical focalpoints underwent training.

African Union Chairperson,Nkosazana Dlamini-Zuma,ECA Executive Secretary CarlosLopes and AfDB Vice-Presidentand Special Envoy on Gender,Geraldine Fraser-Moleketi,attended the presentation andwelcomed the progress theinstitutions have made towardsfinalizing the index. Among theemerging results, thereappeared to be a strongperformance by Southern Africain the area of trade integration.

Fidelity Bank wins the2014 Green Era awardFidelity Bank at the

weekend won the GreenEra Award in recognition of theBank’s Green initiatives.Announcing the award at a galanight during the 2015 GreenEconomy Forum in Germany,Association OtherWaysManagement & Consulting,organizers of the event said thatFidelity Bank was adjudged thewinner of the award havingcome tops in all the parametersset for the award. Specifically,they said that the Bank’s drivefor long term economicdevelopment; contribution toreduction in greenhouseemissions and ability to manageenvironmental risks incustomers’ businesses amongothers won the award for theBank.

Receiving the award,Managing Director/ChiefExecutive Officer, Fidelity BankPlc. Nnamdi Okonkwo thankedthe organisers of the event forhonouring the Bank. Okonkwo,who was represented by theHead, Corporate SocialResponsibility (CSR), Chris

The availability ofsecured credit tohouseholdsdecreased in Q1,2015 but wasexpected toincrease in thenext quarter

In spite of optimism ofimproved economic

conditions, businesses acrossthe country said that they expectthe naira to further depreciate,while interest rate and inflationrate would continue to rise.

These were highlights of theBusiness Expectation Survey(BES) conducted by the CentralBank of Nigeria (CBN) lastquarter. “Majority of therespondent firms expect thenaira exchange rate todepreciate in the current andnext quarters, as the confidenceindices stood at –14.7 and –5.1points, respectively.Respondent firms expectinflation rate to rise in both thecurrent and next quarters, asthe confidence indices stood at18.5 and 7.3 points,respectively. Respondent firmsexpect the borrowing rate to risein both the current and nextquarters as the confidenceindices stood at 10.6 and 4.9points, respectively”, thesurvey revealed.

The Business ExpectationsSurvey (BES) is a quarterlysurvey of leading firms drawnfrom Business Establishmentupdated frames of Central Bankof Nigeria and the NationalBureau of Statistics. The BESresult provides advanceindication of change in theoverall business activity in theeconomy and in the variousmeasures of activity of thecompanies’ own operations aswell as selected economicindicators.

The survey for the first quarterof 2015 was conducted betweenFebruary 2nd and 13th. Thesurvey indicated that,“Respondent firms wereoptimistic on the macroeconomy as the businesscondition in Nigeria wasexpected to improve in Q1 2015.The optimism was driven by theopinion of respondents fromthe services sector (7.2 points),followed by wholesale/retailtrade (4.1 points) and industrial(1.6 points).

“Respondents’ optimism inthe volume of total order andthe internal liquidity position,buoyed the volume of theirbusiness activities in the currentquarter. Similarly, the positiveoutlook in access to credit bythe majority of firms upped thefinancial condition of firms inthe review quarter.

“The positive outlook in thevolume of business activities of

Businesses see higher interest rates,further fall in Naira value•Demand for loans rise amidst decline in supply

By BABAJIDEKOMOLAFE

the firms implied improvedprospects for employment in thenext quarter. The sector with thehighest prospect foremployment is the servicessector followed by wholesale/retail trade, industrial andconstruction.

“The respondent firmsemphasized that insufficientpower supply was the majorfactor constraining the businessactivity in Q1 2015. Otherconstraining factors are highinterest rate, financial problems,competition, unfavourableeconomic climate andunfavourable political climate.”

Demand for loans risesamidst decline in supply

Meanwhile, Businesses andhouseholds have increaseddemand for loans while defaultrate improved. This wasrevealed by the CreditConditions Survey (CCS)conducted by the CBN lastmonth. The survey howeverrevealed a decline in availabilityof loans to households.

The aim of the survey

according to CBN is,“Understand trends anddevelopments in creditconditions. This quarterlysurvey of bank lenders is aninput to this work. Lenders wereasked about trends anddevelopments in creditconditions in the previous andnext quarters. The surveycovers secured and unsecuredlending to households; andlending to non-financialcorporations, small businessesand to non-bank financial firms.

The survey revealed that,“The availability of securedcredit to households decreasedin Q1, 2015 but was expectedto increase in the next quarter.Changing liquidity positionsremained a major factor behindthe decrease; lenders furtherreported that tight wholesalefunding conditions also madesignificant contributions.

“Lenders reported that theavailability of unsecured creditto households increased in Q1,2015 and it is expected toincrease further in Q2, 2015.Lenders reported that changingcost/availability of funds,market share objectives andchanging appetite for riskcontributed to the increasedavailability of unsecured creditin Q1, 2015.

“The overall availability ofcredit to the corporate sectorincreased in Q1 2015 and wasexpected to increase further inQ2, 2015. The important factorscontributing to increased creditavailability were changingsector specific risks, changingeconomic outlook and marketshare objective.

“Demand for secured lendingfor house purchase and

consumer loans increased inQ1 2015, and were expectedto increase further in Q2,2015. Despite lenders stancein tightening the creditscoring criteria in the currentquarter, the proportion ofloan applications approvedin Q1, 2015 increased.

“Demand for unsecuredcredit card lending and anoverdraft/personal loan fromhouseholds increased in thecurrent quarter, and areexpected to further increasein the next quarter. However,demand for unsecured creditcard lending from smallbusinesses was expected todecrease in Q1, 2015, whiledemand for overdraft/personal loans from smallbusinesses was expected tofurther increase. In spite ofthe tightening in the creditscoring criteria in totalunsecured loan applicationsin Q1 2015, the proportion ofapproved households totalloan applications improvedin the current quarter.

“Lenders reportedincreased demand forcorporate credit across allfirm sizes in Q1, 2015. It isexpected that credit demandwould further increase for allbusinesses in the nextquarter except for demandfrom OFCs. Following thenarrow spread between bankrates (on small businessesand OFCs) and MPR, theproportion of loanapplications approved forsmall businesses, mediumand large PNFCs increasedin Q1, 2015 and furtherincrease is anticipated in thenext quarter”.


Corporate Finance

By PETER EGWUATU

Zenith Bank Plc, a quoted company on theNigerian Stock Exchange, NSE hasstated its readiness to deepen the retail

space of the banking industry, using its high technologyand innovative products.

The bank over the years has used technology as one ofits major advantages, to service its customers and deliverimpressive returns to shareholders in the process. It hasequally established itself as a leader in corporate andinvestment banking, with the KPMG’s ‘Nigeria BankingIndustry Customer Satisfaction Survey of 2014’ confirmingthe bank’s position as the most customer focused bank inthe country in both the retail and corporate segments.

Meanwhile, with the e bank’s entry into the retail space,more customers will now be able to access efficient servicedelivery that hitherto have been available to only high networth customers and corporate.

Retail space:The bank’s offering in the retail space include the Aspire

account targeting the youth; the eaZySave classic andeaZySave Premium accounts both of which have zeroaccount opening balances; as well as the Zenith PremiumGold and Zenith Premium Platinum, both of which areCOT free and interest bearing.

Zenith Bankset to boostretail banking

CAP Plc unveils‘Copper Orange’as 2015 yearcolourBYPRINCEWILLEKWUJURU

Chemical and AlliedProducts, CAP Plc,

makers of Dulux brand ofpaint and the technologicallicensee of AkzoNobel hasnamed ‘Copper Orange’ asthe 2015 Colour of the Year.

‘Copper Orange’ wasunveiled as the 2015 Colourof the Year in line with theAkzoNobel global traditionand the Dulux brand thoughtleadership positioning in thepaint in Lagos.

The 2015 Dulux Colour ofthe Year- ‘Copper Orange’ isa sun burnt colour that isinviting, surprising, warmand adventurous. It capturesthe natural palette of theearth, human interaction andencourages experimentingbecause it has a depth thatcombines perfectly with othercolours such as pinks,neutrals, whites and otherorange hues, as well asmetallic colors and woodtones

Delivering his keynoteaddress at the event, theGroup Managing Director,UAC of Nigeria Plc, Mr. LarryEttah revealed that the DuluxColour of the Year initiativesignifies the confluence of agreat brand and an impactfulidea about one of the centralthemes of life - colour.

One of the outcomes of theColour of the Year initiativeis the elevation of the art ofcolour

beyond the mundane andprescribed usage andapplication of colourincluding the various iconsand manifestations.

He stated that the theme forthe 2015 Dulux Colour of theYear - Explore, wasstrategically chosen to depictthe mood for the colour whichencourages everyone toexplore everydayopportunities.

Ettah added that CopperOrange totally captures theeveryday mood and the fivetrends that support it whichare adventure, unseenspaces, him and herlayering and friendly barterin tandem with theprediction of colour experts,based on research, that awarmer spectrum of redsand oranges is emerging,one that reflects a morepositive global outlook.

MD/CEO, Zenith Bank, Mr. PeterAmangbo,

We are forward-thinking,benchmarking trendsin technology toshape our futurecoupled with ourpractical delivery ona highly automatedplatform that makesus unique

The KPMG survey, whichconfirmed Zenith Bank’s statusas the most customer focusedbank, focused on the perceivedquality of customer servicedelivery by banks from thecustomer’s perspective acrossthe retail, corporate/commercial and small &medium sized enterprises(SME) segments. And for 2013and 2014, Zenith Bank led asthe preferred by customers.

For the second consecutiveyear in the retail segment,Zenith Bank emerged as themost customer-focused bankclosely followed by DiamondBank who moved to second(from last year’s fourth place)with GTBank in third place.

Aside being the mostcustomer focused bank, ZenithBank’s performance on allparameters has beenrecognized by other bodies. Asurvey conducted byPricewaterhouseCoopers(PWC) to determine the mostrespected companies and chiefexecutives in Nigeria, ZenithBank emerged first among thebanks. In arriving at theconclusion, PWC said arespected company is definedby these enviable parameters:

A good corporate citizen,which is socially responsiblewith high ethical standards; atrusted company, whichpromotes good values with aunique and excellentleadership style, coupled withstrong management principlesand structure plus a smoothsuccession plan as well as avery resourceful company withexcellent business culture.

Others are: a visionary andrevolutionary company withstrong focus, innovative withpopular brands of highquality; engaging in humancapital development and highcapacity building and anindigenous company with highlocal content. Good corporategovernance practice, highshareholder interest andvalue, harmonious industrialrelations, friendly and goodworking environment, globaland internationally recognised(Multinational) and size ofcompany/largest in Africa/industry leader were otherparameters used in arriving attheir inference.

Going forward: Run by a stable board and

management, Zenith Bank hascreated a professionalenvironment whereindividuals are encouragedand can aspire to achieve theirpotential. Currently under themanagement of PeterAmangbo, Zenith Bank has apool of talents at both themiddle and top management

level, which has enabled it toremain competitive throughthe series of banking reformsin the country.

The bank, Nigeria’s biggestby Tier-1 capital seestechnology as an enabler andas a generator of newopportunities. “We aref o r w a r d - t h i n k i n g ,benchmarking trends intechnology to shape our futurecoupled with our practicaldelivery on a highly automatedplatform that makes usunique,” Amangbo recentlysaid. “As the country ’sinformation technology (IT)infrastructure improves, ourleading edge in IT keeps uswell positioned in the globalbanking community to sustainour offering of exceptional E-banking services. This iscomplemented by our riskmanagement system thatcreates a blend that not onlygrows our customers’businesses but alsostrengthens them. Our creditmanagement system stressesrational procedures andtransparency,” he was quotedas saying.

Five year financial results:The bank has been posting

impressive financial resultsover the years, rewardingshareholders with equallyimpressive dividends. Forinstance, five yearperformance from 2009 to 2013showed steady growth in profitand returns on investments.

For instance, revenue grewfrom N277 billion in 2009 toN244 billion in 2010, N307billion in 2012 and N351

billion in 2013. Profit before taxrose from N35 billion, to N50billion in 2010, N61 billion in2011, N101 billion in 2012 andN111 billion in 2013.

Shareholders have beenbenefitting from the growthwitnessed in the profitabilityover the years. Shareholdersgot a dividend of N11 billionin 2009, N26 billion in2010,N29 billion in 2011, N50 billionin 2012 and N54 billion in2013.

2014 Financial resultsZenith Bank grew gross

earnings by 14.76 per cent toN403.3billion, up from N351billion. Interest Income grewby 15.9 per cent from N272billion to N313.4 billion, whilenon-interest income rose by39.1 per cent to N90.1billion.

Profit Before tax (PBT)increased by 12.8 per centfrom N106 billion to N119.8billion while Profit After Tax(PAT) for the year rose by 8.6per cent N91.5 billion to N99.5billion. The board hasproposed a dividend of N1.75per share. Return on averageequity stood at 18.7 per cent,while return on average assetstood at 2.9 per cent. Loan todeposit was 68.2 per cent upfrom 55 per cent in 2013. Costto income ratio was 55.2 percent, as against 55.7 per centin 2013. Net margin was 24.7per cent compared with 27.1per cent.

Analysts’ commentsAssessing the full results,

analysts at FBN CapitalLimited, said the bank met itsfull year PBT target of N120billion, implying an 8.3 percent growth.

According to them, the fourthquarter (Q4) PBT 2014 PBTworked out as N33.0 billion,up 19.7 per cent. “Q4 2014 PATgrowth was less impressive at6.5 per cent because tax morethan doubled and othercomprehensive income fell 78per cent. While funding incomegrew by a modest 3.9 per centto N63 billion, non-interestincome more than doubled toN29.7 billion,” they said.

The analysts added that thepicture was similar for the mostpart down to the PBT line:double-digit q/q growth on therevenue lines more than offsetcost/loan loss expenseincreases.

“Again, non-interest incomewas the standout performer: itgrew by 96 per cent q/q.Notwithstanding, PAT fell by9.1 per cent q/q because theimpact of a marked reductionin other comprehensiveincome proved significant.Relative to our forecasts, PBTwas ahead by 26 per cent andPAT by 15 per cent. Thedifference in magnitudebetween the two percentagefigures was down to the taxrate (13.9 per cent) coming inwell ahead of our 4.5 percentforecast,” they said.


CMYK

Corporate Finance

Wall Street upahead of holiday;data lifts payrollhopes

U.S. stocks rose in abroad advance on

Thursday as a reading on thelabor market came in betterthan expected, raisinghopes that Friday’s payrollreport would show similarstrength.

Jobless claimsunexpectedly fell in thelatest week, suggesting thelabor market continues toexpand at a solid clip evenas economic growth hasstalled. The report followsl o w e r - t h a n - e x p e c t e dreadings on private sectoremployment andmanufacturing onWednesday.

Investors were lookingahead to the March jobsreport, which will bereleased Friday, a stockmarket holiday for GoodFriday. As a result, marketparticipants will be unableto trade off the report untilMonday.

“People are looking aheadto the jobs report and rightnow it would be a surprise ifit was weaker thanexpected,” said John Carey,portfolio manager at PioneerInvestment Management inBoston, though he saidplaying it ahead of timecould be tricky.

ECB makes QEbonds available forlending to easeliquidity woes

The European CentralBank began a bond-

lending program to helpunclog markets snarled upby its own debt-purchaseplans introduced last monthto boost growth and stave offdeflation.

The move is importantbecause it reduces the riskfor traders that the region’sbond market becomesdysfunctional after the costof borrowing securities inthe repurchase marketclimbed due to a shortage ofcollateral, threatening toreduce liquidity. Bondspurchased under the ECB’squantitative-easing programwill be made available forlending from Thursday, theFrankfurt-based central banksaid on its website.

“The aim of securitieslending is to support bondand repo-market liquiditywithout unduly curtailingnormal repo-market activity,”the ECB said in itsstatement. “

Operators renew call for CISinvestment optionStories by NKIRUKANNOROM

Operators in the capitalmarket have renewed

their call for local investors,especially retail ones, to accesscapital using the CollectiveInvestment Scheme, CIS, as anoption.

They noted that leveragingthe collective investmentscheme would reduce the levelof exposure to risks and ensurethat their investments aremanaged professionally.

According to the Group ChiefExecutive Officer, Mrs.Oluwatoyin Sanni, investingthrough fund managersremained a better option forretail investors because the fundmanagers are better placed tomaximize investmentsopportunity the way anindividual investor cannot.

She observed that investorstend to shun the CIS due toinadequate knowledge, urgingthe fund managers to do moreto create awareness of how themarket could be accessedthrough the CIS.

Sanni explained that theFunds pooled through the fundmanagers have separatecustody just as the PensionFund, adding that there is alsoa separate trustee that handlesany complain or challengesfrom the fund manager to theregulator.

She acknowledged thatearlier, the CIS that wereintroduced in the market werenot properly managed andwere not adequately supervisedand so, investors had nastyexperiences. But, she addedthat the regulators have gonemuch further to put in place

very effective mechanismsthrough which the schemesare now managed. “And, Ithink it is very, very safe toinvest in CIS now” the UnitedCapital boss said.TheManaging Director CranesSecurities Limited, Mr. MikeEzeh in his own contributionsaid that although mutual funddoes not enjoy the kind ofpatronage equities enjoy, it isa very good investment optionto explore the market.

He encouraged investors totake advantage of thedepression in stock prices tobuy units of well-managedmutual funds in order tobenefit from the capitalappreciation over time.

Ezeh explained that whileinvestors rarely patronizemutual funds in Nigeria,participation in some otherfinancial markets is higherthrough mutual funds ratherthan by direct investment inequities. For instance, in

Brazil, 10 million moreinvestors participate in themarket through mutual funds,while only 500,000 investdirectly in the market, he said.

Explaining how CIS works,Ezeh said by pooling funds ofseveral individual andcorporate investors, it givesinvestors access to investmentsthat they will ordinarily nothave access to.

“Unlike equities, a CIS isgenerally not traded on a StockExchange but investors buyand sell units to/from the fundmanager at any time. Sharesare created and sold to newinvestors on a continuous basisso you can either invest a lumpsum or on a regular monthlybasis,” he said.

According to him, theoperation of the entity is basedon the principle of thediversification of risk.

Speaking in the same vein,Deputy Managing Director,ARM Securities, Ms. JumokeOgundare said that mutualfund subscribers in Nigeriapresently stands at 250, 000 inspite of over 160 million of itspopulation. Delivering alecture on the theme‘Collective InvestmentSchemes (CIS) in Nigeria’,Ogundare explained that CISis an open ended collectiveinvestment scheme that issuesredeemable units and investsprimarily in transferablesecurities or money marketinstruments.

Listing the benefits of CIS,she said it reduces investmentrisk through diversification,lowers transaction costs, whileless sophisticated investorsobtain the opportunity ofhigher returns by having aregistered professionalsmanage their investments andre-investment of income.

The Nigerian Stock Exchange, NSE, hasgranted quoted companies that are yet

to submit their 2014 year end financial reportsand accounts a 30 day grace period from thedue date of required period submission to doso. In a notice announcing the extension,Josephine Igbinosun, Head, ListingRegulations Department, NSE, said theextension would be initially applicable tocompanies whose year-end is December 2014.According to her, the extension becamenecessary in view of some of the challengesbeing experienced by listed entities in meetingtheir regulatory filing obligations with theExchange.

She listed some of the observed challengesto include the change of date of the generalelections, which impacted on the meetingcalendars of some Boards, adding thatcompanies with primary regulators had to beconsidered as well due to the need for them toobtain prior approvals from their variousprimary regulators before their financial

Account submission: NSE givesquoted firms 30 days grace

statements are released to the public.“While we believe that the timely disclosure

of financial information is critical tostakeholders in the capital market, particularlythe investing public, the challenges which thelisted entities are facing are germane.

“Consequently, in view of the extenuatingcircumstances, the Exchange has decided togrant all listed entities a grace period of 30days from due date of the required financialperiodic submissions, commencing withcompanies whose year-end is December 2014,”Igbinosun said. “During this period, theExchange will not apply the tag- Below ListingStandard (BLS) beside the names of entitieson the X-Complaince Report which ispublished on its website and will also forbearfrom imposing any financial penalties pursuantto the provisions of Section 30.3 of the AmendedListing Rules during the grace period,” sheadded. Meanwhile, only 45 quoted companieshave so far submitted their various 2014 year-end financial reports to the Exchange.

Unlike equities, aCIS is generallynot traded on aStock Exchangebut investors buyand sell units to/from the fundmanager at anytime

UNVEILING - From left: Group Managing Director, UACN Plc, Mr. Larry Ettah; ManagingDirector, Chemical and Allied Products (CAP) Plc, Mrs. Omolara Elemide; and Chief FinanceOfficer, UACN, Mr Abdul Bello, at the unveiling of the 2015 Dulux Colour of the Year held inLagos


CMYK



more impressed and confidentin a society with little or nocorruption. With the nononsense stand of thePresident-elect, we expect tosee a much bigger interest ininvestors wanting to pushfunds into Nigeria. Stability inthe exchange rate will alsodefinitely lead to morecompanies resuming trade asbefore and this we hope to seewith the emergence of not justthe APC candidate but mainlydue to the peaceful nature ofthe transition.”

On his part, founder,drinks.ng, Lanre Akinlagunsaid the gains made in theinformation andcommunications sector must besustained through theretention of the current ministerof ICT, Dr. Omobola Johnson.

He said: “It is difficult to sayexactly what he will do but wein the IT sector do hope thathe retains the minister ofcommunication technologybecause the lady that was therewas committed and he had lotsof plans on ground that are yetto be implemented and do notneed to be abandoned. This isbecause, as this government isleaving, there will be no wayto ensure that those laudableplans are followed. But in all,one cannot really predict whatthe direction will head until hebegins to appoint his cabinetmembers.”

In the same vein, founder/CEO hotels.ng, Mark Essiensaid: “Buhari’s governmentshould continue the policieslaunched by the Minister ofCommunications Technology,Omobola Johnson, which hasled to a surge in ‘serious’ e-commerce start-ups.”

InsuranceFollowing the election of

General Muhammadu Buharias President-elect of Nigeria,insurance operators tasked theincoming administration toensure that economic growthshould be the main focus.Insurance operators whoreacted to the victory of Buharinoted that he should come outwith a blueprint for theeconomy that will enhance theliving standards of Nigerians.

Deputy Commissioner forInsurance, Finance, Mr.George Onekhena, said thatthe insurance industry wasentering a new phase oftransformation with theJonathan’s administration; assuch, operators expect thetrend to continue because theNational InsuranceCommission, NAICOM, whichis the regulatory body forinsurance practice in thecountry, is highly structured.

Onekhena said, “NAICOM isa structured entity and all thetransformation programmes wehave introduced in the sectorare also well structured, as suchthe new government willcontinue with the structure onground to ensuresustainability.”

Onekhena said that the policymeasures being embarked onby NAICOM to transform theinsurance sector are notpolitical programmes; as suchthese reforms should besustained to ensure continuity.

Chairman of NigerianInsurers Association, NIA, andManaging Director of LinkageAssurance Plc, Mr. GodwinWiggle said that operators arewaiting for the newgovernment to come out withits blueprint for the economy.

Director General of NigerianInsurers Association, Mr.Sunday Thomas said that thenew government will have tocome out with its own agendafor the economy and ensure

that the government takesinsurance seriously.

Thomas said, “We hope thatthe new government willimplement some of the issuesof restructuring that we havebeen talking about in theinsurance sector. We expectincreased governmentpatronage of insurance,compliance with compulsoryinsurances as well as insuranceof government assets, as wellas review of the mode oftaxation on insurance services.In all, we expect the newgovernment to build on theachievement of the previousadministration.

Managing Director of FBNInsurance Life, Mr. Val Ojumahadded that the main focus ofthe incoming administrationshould be to stabilise theeconomy and allow continuousgrowth. According to him, if theeconomy is stabilised and thereis continuous growth, everysector of the economy will growand will have a positive impacton the people and the countryas a whole.

AdvertisingFelix Aighobai,

Director, Sales, Euro GlobalFoods and Distilleries

Limited, said, “We expect himto start from where hispredecessor has stopped.Somebody has created alegacy to encourage theindustry, and I know very wellthe way the government hasbeen running in Nigeria.People will work to surpasswhat they meet on the ground.Since being the newly anddemocratically electedPresident. I expect him to dobetter off based on thatexpected hope.

Bolaji Okusaga, ManagingDirector, The QuadrantCompany, “He is workingwith some economist at themoment people like Pat Utomi.He has not released any policyposition, so we cannot beginto make any permutation, butthe fact that there has been apeaceful election, and awinner has emerged, and thatthe loser has conceded defeat,alone, is enough confidencefor the economy, as it takes offthe risk of political uncertainty.So in that end I believe betterthings are ahead.

Ikechi Odigbo, ChiefOperating Officer, DDBLagos

The fact we have had a fairlysuccessful electoral processand we have had a situationwhere both presidentialcandidates have comportedthemselves in maturity,particularly with the incumbentextending hand of fellowshipand being graceful in defeatand conceding with honour anddignity, that Nigeriandemocracy has experienced ahuge boost, because for the firsttime we have seen asuccessful transition ofleadership from one politicalparty to another.

And what that will definitelydo is to give the incomingregime the much needleverage them to buildbecause there would be greaterconfidence in the democraticsystem, there will be greaterconfidence in our political

BATNF reiteratescommitment toenhancing smallholderfarming practicesThe British American

Tobacco NigeriaFoundation, BATNF hasreiterated its commitment togovernment’s povertyalleviation schemes with itsstrategic investments which aretargeted at smallholder farmers,to improve their productivityand therefore earn decentincomes from their agriculturalactivities. Abimbola Okoya,General Manager, BATNF,while speaking at aninteractive session organisedby the Foundation for its keystakeholders, to map out newstrategies to boost agriculturalproductivity with a focus onbetter ways of enrichingsmallholder famers, said thattheir activities are focused onwhere they could achieve themost impact in the agriculturevalue chain.

“The BATNF has recordedremarkable milestones throughthe deployment of strategicintervention schemes focusingon provision of potable watersupply, vocational skillsdevelopment, agriculturaldevelopment, andenvironmental protection sinceits establishment in 2002,” saidMs Okoya, while addressingstakeholders at the conferencewhich held in Ibadan, OyoState, last week.

•Victor Ogiemwonyi •Albert Okumagba •Emeka Madubuike


Cover Story

Six candidates forposition of IMOSecretary-GeneralBy GODWIN ORITSE,with agency report

By the establisheddeadline of 31 March

2015, the InternationalMaritime Organization (IMO)has received the nominationsof six candidates, nominated bytheir Governments for theposition of Secretary-General ofIMO. The election for the postwill be held at the 114thsession of the 40-Memberstrong IMO Council, whichmeets from 29 June to 3 July2015. The decision of theCouncil will be submitted to theIMO Assembly, which meets forits 29th session from 23November to 2 December 2015,for its approval.

The nominations receivedincludes Mr. AndreasChrysostomou Republic ofCyprus, Mr. Vitaly KlyuevRussian Federation, Mr. Ki-tack Lim Republic of Korea, Dr.Maximo Q. Mejia, Jr. Republicof the Philippines, Mr. AndreasNordseth Kingdom of Denmarkand Mr. Juvenal ShiunduRepublic of Kenya.

The main focusof theincomingadministrationshould be tostabilise theeconomy andallowcontinuousgrowth


CMYK

Business & Economy

The Securities andExchange Commission,

SEC has released six newrules to the capital market asone of these rules is rule ontrading in unlisted securities.

Unlisted securities are thoseprivate and public companies’shares that are not quoted onthe Nigerian Stock Exchange,NSE.

The unlisted securities seekto ensure that all securities ofunlisted public companies aretraded within securitiesexchanges that are registeredwith the commission.

Under Section 313(1) of theInvestments and SecuritiesAct 2007, the Securities andExchange Commission[“SEC”] is empowered tomake Rules and Regulationsfor effective regulation of theNigerian Capital market.

Commenting on this rule,NASD Plc stated “ We atNASD believe this new rulewill introduce new levels oftransparency to the Over the

SEC out with new rules oncapital market

By PETER EGWUATU

Counter , OTC market inNigeria. It will enable bestpractice by operators:protection for investors: betterprice discovery for the marketin general and a muchdeeper, more liquid, capitalmarket. We believe a dynamicand responsive rule makingprocess is also a vitalingredient for rapid butorganized growth and we lookforward to the continueddevelopment of our markets.”

In addition to the Rule on

trading unlisted Securities,other new rules that wererecently published by the SECare: . Code of Conduct forRating Agencies; . Code ofConduct for Underwriters; .Code of Conduct for Trustees;Rules on Securitization andRules on National InvestorProtection Fund.

Rule on trading in unlistedsecurities ustification: Toensure that all securities ofunlisted public companies aretraded within securities

exchanges that are registeredwith the Commission.

First , all Securities ofunlisted public companiesshall be bought, sold ortransferred only by means ofa system approved by theCommission and under suchterms and conditions as theCommission may prescribefrom time to time.

Secondly, no person shallbuy, sell or otherwise transfersecurities of an unlistedpublic company except

through the platform of aregistered securitiesexchange established for thepurpose of facilitating over-the-counter trading ofsecurities.

Thirdly, any unlisted publiccompany, director, companysecretary, registrar, broker/dealer or such other personswho facilitate the buying,selling or transfers of thesecurities of an unlistedpublic company otherwisethan through the platform ofa duly registered securitiesexchange, shall be liable to apenalty of not less than ¦ 100,000 in the first instance andnot more than ¦ 5, 000 forevery day of default.

In pursuit of the strategicdrive to attract youths into

its membership structure, theChartered Institute ofStockbrokers (CIS) has sealeda pact with a frontline capitalmarket operator, PerfectionNominees Limited to deploy itstechnical and professionalstrength to mobilize over150,000 potential applicants forthe institute’s ProfessionalDiploma in Securities andInvestment.

This business and marketingrelationship was consummatedwith the signing of aMemorandum ofUnderstanding (MOU) by bothparties at the week end in theInstitute’s chamber. By theMOU, Perfection Nomineeswould mobilize over 150,000young Nigerians annually and

CIS, Perfection Nominees partner on membership drivepresent them to CIS fortraining, examination andcertification as a prelude tolaunching the young Nigeriansinto the financial world. Thisis expected to assist inactualizing the NationalStrategy for FinancialInclusion and Savings.

The long term plan is todevelop young entrepreneurs.By the MOU, the institutewould recognize PerfectionNominees as a non-exclusiverepresentative with associatedbenefits of agreed discount forits efforts among others. Thebeneficiaries would also createfinancial planning houses forthe operators in the entirefinancial market and thegovernment sector.

At the last count, the institutehas signed an MOU with no

fewer than seven majororganizations on the samesubject. At the signingceremony, the Chief ExecutiveOfficer, Perfection Nominees,Reverend SamuelOlayemiexpressed optimismthat the goals of the MOU wererealistic and thereforea c h i e v a b l e .Olayemicommended theinstitute for the bold initiativeaimed at creating jobopportunities for youngNigerians. “I feel delightedthat I have an opportunity toserve the institute. I identifywith the caliber of the Institute’sPresident and his team as wellas aggressive focus of theadministration. I have nodoubt that the outstanding Billthat would further

internationalize the operationsof the stockbrokers would besigned.”,Olayemi said at theweek end.

Responding the institute’sPresident, Mr AlbertOkumagba explained thatinvolvement of a professionalof Olayemi’s standing wouldreinforce the mobilization of theyouths to create the much-needed financial power housefor the entire system.Okumagba noted that theinstitute’s position had beengraciously endorsed by theFederal Government as one ofthe means of boosting youthempowerment in Nigeria. Hecommended PerfectionNominees on its corporatedecision to take advantage ofthe unique marketingopportunities provided by theCIS.

Okumagba had earlier saidthat the ultimate objective oflaunching the young Nigeriansto the new professionalopportunity was to provideback-up staff for all operatorswithin the ambit of the financialmarket including insurance,pension fund, stockbrokingfirms, issuing houses,securities markets and othercategories. The signingceremony was attended by theInstitute’s Registrar and ChiefExecutive Officer, MrAdedejiAjadi.

Perfection Nominees is amanagement consulting firmwith a strong background incapital market activities. Thecompany also createsopportunities for business,advancing corporate goals andengages in general trading.The CIS is saddled with theduty of determining whatstandards of knowledge andskill are to be attained by thosewho aspire to becomeprofessionals in stockbroking,portfolio management, assetmanagement, investmentmanagement and allied fieldsof specialization.

Rule on trading inunlisted securitiesustification: Toensure that allsecurities ofunlisted publiccompanies aretraded withinsecuritiesexchanges thatare registered withthe Commission


CMYK


Cover StoryCommodity Index

and we have had asituation where bothpresidential candidateshave comportedthemselves in maturity,particularly with theincumbent extendinghand of fellowship andbeing graceful in defeatand conceding withhonour and dignity, thatNigerian democracy hasexperienced a hugeboost, because for thefirst time we have seen asuccessful transition ofleadership from one political party to another.

And what that willdefinitely do is to givethe incoming regime themuch need leveragethem to build becausethere would be greaterconfidence in thedemocratic system, therewill be greaterconfidence in ourpolitical process.

And this wouldimpact positively on theeconomy. I expect thatthe stock market willbegin to find buoyancy.I believe that the foreigninvestors will begin tolook back to Nigeriaagain, and look back tothe Nigerian marketwith positive confidencethat have crossed overthe threshold, thatseason of uncertainty,that season of mereupheaval and unrest. Wehave crossed thatthreshold, and we haveentered into a new era ofstability that will greatlyboost confidence in theNigerian market bothwithin and outside.

I actually believe this isa most remarkableoutcome for Nigeriansthat we have had asituation that for the firsttime in our history, theloser has contributedimmensely to creating


this very positiveatmosphere. And thewinner needs to continueto build on that. It’s a bigwin for our economy. It’sa big one for everyNigerian.

Summary ofrecommendations

Start from whereyour predecessor

stopped;lBuild on the

achievements of theprevious administration;

lDo not build new anticorruption agencies butbuild on existing ones

lDevelop blueprint forthe economy that willenhance the livingstandard of Nigerians;

lBring moretransparency into thebusiness landscape inorder to drive foreigndirect investment;

lEnsure the blocking of

all fiscal leakages andwastes in government,especially in respect ofthe management ofpetroleum productssubsidy, pension funds,import duty waivers,ghost workers in theMinistries, Departmentsand Agencies, MDAs,Service Wide Votes andcrude oil theft.

lUse capital market tofund infrastructure;

lPromote nationalsavings throughCollective InvestmentSchemes;

lIntroduce incentivesto encourage listing onthe stock exchange;

l E n h a n c emarketability ofagricultural productswith policies that boostoperations of commodityexchange;

lMake positivestatements that boostinvestors’ confidence;

lReduce governmentborrowing to avoidcrowding out privatesector;

lImplement measuresthat will encouraget r a n s p a r e n c y ,a c c o u n t a b i l i t y ,adherence to rule of law;

lFocus on reformingthe petroleum industryand shedding it off thereputation ofopaqueness;

lImplement policiesthat guarantee a changethat is more pragmatic;

lAccelerate reforms inthe Oil & Gas sector inorder to attract moreprivate investments inboth the upstream &downstream segments ofthe sector;

lAddress thefundamental of the highcost of doing businessand low productivity;

lEnsure a level playingfield for all investorsacross all sectors withregard to import tariffs,funding opportunities,tax incentives;


•Ikechi Odigbo, CEO, DDB Lagos) •Bolaji Okusaga, ManagingDirector, The Quadrant company

March 27-April 2, 2015

Address thefundamentalof the highcost of doingbusiness andlowproductivity;Ensure a levelplaying fieldfor allinvestorsacross allsectorswithregard toimport tariffs,fundingopportunities,tax incentives

CMYK

34 —Vanguard, MONDAY, APRIL 6, 2015

Micro-Finance

The institute of CharteredAccountants of Nigeria,

ICAN, has said that thereshould be a rethink on theundue pressure on naira afterelections. President of theInstitute Mr. Chidi Ajaegbu,made the position at a pressbrief in Lagos, as a kick off ofits 50th anniversary celebrationcoming up in September thisyear, where he highlightedsome of the achievementsmade and challenges itaddressed within the years.

Excerpts:

To what extent has yourrecommendations to theFederal Government beenaccepted?

We are more like a pressuregroup, if we advisegovernment, send letters tothem on what we think is theright way to and they decide notto accept our advise, there isautomatically nothing we canactually do, advocacy is aboutparticipating in the policymaking process ensuring goodgovernance, we do not havepower to insist that we feel isright should be implemented.But it is our responsibility to

Post-election: ICAN wary of undue pressure on naira…commences 50th anniversary celebration

By PROVIDENCE OBUH

If you are borrowing toinvest, then you areborrowing inanticipation of agreater consumption inthe future that willreturn your capital andcost of fund andprobably addsomething on top

keep taking about what wethink is right whethergovernment accepts or not. Sowhen we advise governmentand they don’t accept, there isnothing we can do. But we havehad situations wheregovernment because of ourstrong positions changed mindon the printing and introductionof N5, 000 bills during theSanusi regime. Sanusi came toour conference that year andconfirmed that it was becauseof ICAN’s letter to the Presidentthat led to the stoppage of theprinting and introduction of theN5, 000 note.

On naira devaluationThe pressure on the naira is

as a result of the fact that this isbasically an import basedeconomy. Everything we useare imported and we need topay in dollar. Why we are notproducing is because we don’tthink, we are oil producingeconomy and we are not evenadding any value in terms ofthinking of what to process andthen export. Except we dealwith our appetite in foreigngoods, foreign services we willcontinue to import. Theenormous amount of money thatis being remitted by the elites

abroad can also cripple thiseconomy. We need to have atotally descent attitude to theway we leave. The austeritymeasures wouldn’t deal withthe problem of the economy, we

need to deal with the amountof naira we have in circulation.Starting from cutting down thecost of governance, you can’t beputting your budget at 65percent per dollar per barrelwhen it is obvious from look thatyou have not been able toachieve sixty in order to achievefifty. Everybody is borrowing,Lagos state is borrowing a lotof money, even the federalgovernment to fund recurrentbudget and you are notinvesting. If you are borrowingto invest, then you areborrowing in anticipation of agreater consumption in thefuture that will return yourcapital and cost of fund andprobably add something on top.But here we are borrowing toconsume, to run thegovernment. That model I havenot seen anywhere it hasworked. After the elections Iexpect the tiers of governmentto seat down and have a rethinkon the issue of undue pressureon the naira currency.

How far has the whistleblowers fund been accessed?

The whistle blower fund, weset out a N50 million and aboard of trustee to administerthat fund we are consideringabout seven applications

possibly to access that fund as Ispeak. Before the advent of thewhistle blowers fund, theinstitute has carried out thingsthat we felt are necessary whenour members are undulyharassed either in the law courtor anywhere else, we have hadto go to court to hold brief forour members and especiallywhen we think they are doingthe professional thing, I don’twant to give instances but amsure of about two or three of thatin the last three years and wewill continue to do that becausethese are the necessary thingsthat will make for a betterprofession and a better society.

Some of the Challengesaddressed

We mentored Association ofNational Accountants of Nigeria(ANAN) to becoming a memberof over two bodiesinternationally, before now wehad an issue with ANAN thatwe went to as far as the supremecourt and for us to now help toencourage to lift their standardto the point of now saying thatwe think this will help tostrengthen their processes andprofession in the country, I thinkthat also a resolution in itselfand again is one of theresolutions that we have beenable to achieve within theNigerian Jurisdiction. We havealso signed an MOU with theChartered Institute of Taxationof Nigeria (CITN).

•Mr. Chidi Ajaegbu

“Nasarawa to spendN107.9bn in 2015”, PUNCH,January 1, 2015.

The report by UmarM u h a m m e ddisclosed that “The

budget which was christenedthe budget of “sustainability”would be funded withresources from the FederationAccount, internally generatedrevenue [IGR] Value AddedTax, and SURE-P.”Commissioner Danazumi, forLocal Government andChieftaincy Affairs, whodelivered the budget on behalfof ailing Governor Al-Makura,could be forgiven for notrealizing that he had deliveredthe most unrealistic andunsustainable budget in thestate’s history. But, Danazumineed not feel bad. Nasarawastate is merely following in thefoot-steps of other states whichhad presented budgets to theirStates’ Houses of Assembly.

Simple arithmetic tells usthat a state budgeting to spendN107.9 bn (N108 rounded up)would need to generate N9bnper month from all sources in2015. The question is howrealistic is this for Nasarawa?

To start with, SURE-P as a

Nasarawa State Budget as metaphor for unrealistic state budgetssource of revenue has closedshop in reality. Dr NgoziOkonjo-Iweala will soon revealthat truth to everybody. But,when the Federal budget isbased on crude oil selling at$65 per barrel and the currentprice is under $57 per barrel,there will be no subsidyanymore. So out goes an entirerevenue source from theestimates.

Value Added Tax, VAT,could be up or down from lastyear’s actual revenue collecteddepending on how much VATrate is increased and howmuch is actually collected in2015. But, with crude pricesgoing downwards, there isevery chance that the Nigerianeconomy might contract andVAT collection might drop.

However, SURE-P andVAT are minor variables in thebudget estimates. Togetherthey cannot account for morethan fifteen per cent of thebudget estimate. The bulk ofthe revenue expected to fundthe budget of “sustainability”will come from the FederationAccount, FA, and IGR. Thequestion is: how well hasNasarawa performed inderiving revenue from IGR?The answer is: very poorly.

In an excellent report titled“States struggling to paysalaries”, DAILY TRUSTreporter, Nurudeen Abdallah,on December 15, 2014, page 5,disclosed that, with theexception of Lagos, Rivers,Delta and Kano States, whichgenerated N384.5bn, N87.9bn,N50bn and N24bnrespectively, no other state gotclose to N25bn. Nasarawaactually achieved IGR N4.1bnin 2013. The 2014 result mightnot be different.

That leaves us with therevenue from FA to provide thebulk of the funds for 2015. Andit is precisely on this accountthat the Nasarawa state budget,as well as those of other statesfall apart. As things stand rightnow, the Nasarawa state Houseof Assembly will be wastingeverybody’s time, raising falsehopes among the people if itexpects the state to raiseN108bn this year. Here is theevidence.

The October 2014 allocationto states from the FederationAccount, should have served asa warning to the states. All thestates collected far less thanthey had collected in a monthin more than two years.Nasarawa collected only N5bn

from Abuja. That sum includedFA, VAT, and SURE-Pallocations. And it alsoincluded the state’s share of theExcess Crude account whichwill not longer be disbursed aslong as crude prices remainlow. Furthermore, the FA wasmade from crude selling at wellover $80 per barrel. The FAallocations for 2015 will bemade from crude selling at $60or less and without ECA andSURE-P funds. Certainly N9bnrevenue per month can at bestbe regarded as a gross error,at best; or an unwarranted jokeat worst.

Again, it needs to berepeated that Nasarawa is notalone in making thismonumental mistake at a timewhen every state needs adviceon how to put together a reallysustainable budget. Readilyavailable information on otherState budgets which representthe prevalent flight from realityinclude the following: BenueN8.5bn per month budgetversus N5.2bn expected; BornoN14.8bn budget versus N7.7bnexpected and Gombe N7.5bnversus N3.8bn. One cannothelp wondering if ALL thestate governors intend to printtheir own currencies to make

up the shortfalls they willexperience in 2015.

The Speakers of the StateHouses of Assemblies and theHonourable members, if theylove their people would be well-advised to put the interest of thepeople above partisan andselfish considerations. Ifbudgets which cannot beimplemented are passed, thepeople will sufferimmeasurably. Civil societygroups in every state shouldalso rise to the occasion. Thestates that will be destroyedthrough a bogus budget belongto all of us. Politicians,irrespective of political partyshould not be allowed to bringunprecedented civil unrestnationwide on all of us.

NEXT: FOR HOW LONGWILL THE COUNCIL OFSTATES REMAIN SILENT?

The Council of States includesall former Heads of State alive– Obasanjo, Shagari, Buhari,Babangida, Shonekan,Abubakar and Obasanjo again.For how long will they keepquiet while the nation sinks?For once silence is not gold; itis either acquiescence orcowardice. Both areunbecoming of ElderStatesmen….


CMYK

CMYK

Tax Matter

The Nigerian Government hasover the years put in place

many different and overlappingincentive schemes to attract both localand foreign investment. Taxexemption is generally regarded asan industrial investment device;many developing countries likeNigeria offer it as one of their majorincentives. Basically, tax incentivesare designed to encourageinvestments in certain preferredsectors of the economy andsometimes geared towards attractinginflow of foreign exchange tocomplement domestic supplies forrapid economic development.

Tax exemption otherwise known astax holiday is one of the mostwidespread tax incentives. Taxexemption simply means a period ofexemption from payment of taxesimposed by the government and thismay be complete or partial. Thegranting of pioneer status, forinstance, gives a company apreferred position in gettingestablished, usually throughexemption of income tax payment.

A pioneer company is a companythat engaged in manufacturing,processing, mining, servicing andagricultural industries whoseproducts have been declared pioneerproducts on satisfying certaincondition as determined by theIndustrial Development CoordinatingCommittee (IDCC) of the Governmentunder the Industrial Development(Income Tax Relief) Act Cap 179 LFN1990. The pioneer tax holiday is foran initial period of three years orsubject to further extension of twoyears or five years (once and for allwithout further extension).

• Enabling ActAct Chapter 179 laws of the

federation of Nigeria (LFN) 1990 butfirst enacted by Decree No22 of 1971and commenced on 1/4/1970.

Commencement Date 1st April,1970

• “An Act to repeal and re-enact, with major changes, theindustries Development (Income TaxRelief) Act and to make provision fortax relief for certain industries thatmay be issued with pioneer certificatesby the minister and other mattersancilatory there to”.

Conditions:? Industry is not being carried

out on a suitable scale as required andthere are prospects for furtherdevelopment in the industry or itsproduct.

? If it is in the public interestto encourage the industry or itsproduct.

? Application may be made forthe inclusion of a product on thepioneer list

MODE OF APPLICATION? All application to be

addressed to the Minister.? State the status of the

company.? Give details of qualifying

capital expenditure to be incurred.? Give sources of qualifying

capital expenditure and estimatedcost.

? Specify location of Assets.? Date of production of pioneer

products.? Any by product not being a

pioneer product.

TERMS OF PIONEERCERTIFICATE

? Must be in terms of theapplication to which it relates.

? Specify permissible by-products to be produced.

? Specify period within whichcompany must be incorporated andconditions to be endorsed

? Pioneer status will only beissued from a date when company wasincorporated and shall be effectivefrom a date not earlier than the dateon which the application wassubmitted to the minister or date ofincorporation, which ever is the later.

? Any other condition will bespecified by the minister

? The minimum Tax reliefperiod not exceeding five years to bestated 3(6)(a-b)

Amending of Pioneer Certificate toAdd New Product

Section 4 (1) – (3) allowed acompany during its pioneer period tomake application in writing to theMinister to add a new product.

RETROSPECTIVE PIONEEROPERATION

• Where a pioneer certificate isto be operative from a retrospectivedate, all acts shall be treated as nothaving been closed or not havinghappened and all taxes paid (if anyshall be repaid as soon as may afterthe expiration of three months fromthe production day.

PRODUCTION DATE• No later than one month when

the company is going into commercialproduction (marketable quantity), thecompany shall apply in writing for thecertification of its production date.

• Not later than one month afterthe production date or any extendedperiod granted by the FIRS, thecompany shall make application inwriting to the FIRS for the certificationof the amount incurred as qualifyingcapital expenditure prior to theproduction date.

Cancellation of Pioneer Certificate i) A Company may apply for

cancellation ii) If a company contravened any

provision of the Act or failed to meetconditions set.

Tax Relief Periodi) Commencing from the

production date, it shall continue forthree years (but can be extended):-

ii) for another one period of twoyears (if the standard and rate ofexpansion are satisfactory), local rawmaterial utilization expansion,training and development ofNigerians, Government Policy Priority)

iii) Five years (once and for all).

TRANSITION FROM PIONEERSTATUS

Conditions of Old Trade or Businessof a Pioneer Company

? The old trade shall be deemed

to ceased permanently at the end ofthe tax relief period.

? The pioneer company deemedto have set up a new trade on the daynext following the end of its reliefperiod.

? All capital expendituresincurred and used by a pioneercompany shall be deemed have beenincurred on that day next followingthe end of its tax relief period.

? Where it incurs a Net loss,that loss shall be deemed to have beenincurred on the date on which its newtrade commences i.e. it will be allowedto deduct all the losses broughtforward from the pioneer period

? The company must submit tothe FIRS a list of its assets forcertification.

? At the end; the FIRS will issuea certificate of qualifying expenditure.

? The Board is expected to issuethe company for each year, the amountof income as ascertained and loss asarrived at (if applicable).

Treatment of Capital Allowancesand Losses

• A capital expenditureincurred shall be deemed to havebeen incurred on that day nextfollowing the end of the pioneerperiod. I.e. regardless of the numberof years granted a pioneer company,all capital expenditures incurred inline with the provision of the secondschedule within the periods shall bedeemed to have been incurred afterthe Tax relief period.

• For losses incurred within thepioneer period, the cumulativeamount will be deemed for computingtotal profits to have been incurred onthe day, next following the pioneerperiod i.e. it will be allowed as adeduction in the new business.

DOCUMENTATION REQUIREDBY FIRS

? Memorandum and Articles ofAssociation

? Certificate of Incorporation? Answer to standard

questionnaire? Pioneer Certificate issued? The period approved? Production date? Products and by-products? For a going concern, the

Audited accounts ended before theproduction date to be furnished(regardless of the number of months).

Rendition of Returns? The conditions governing the

submission of tax returns in CITA areapplicable to a pioneer company.

? One year from commencementof production date.

? Period of one yearsuccessively.

? Last year of the relief period.? Example: Kano Money

Lender Ltd was granted a pioneerstatus commencing from 1st July,1999. The company has 31/12 as itsaccounting date. The period grantedwas for five years.

? At the expiration of thepioneer period, it submitted accountsfor the years ended 31st December,2004 and 2005 you are given theseadditional data

Tax relief for pioneer companies

For losses incurredwithin the pioneerperiod, thecumulative amountwill be deemed forcomputing totalprofits to have beenincurred on the day,next following thepioneer period


E - Commerce

Dutch inspectorsarrest Uber employeeAn Uber Technologies

Inc. employee inAmsterdam was arrested afterrefusing to cooperate withinspectors raiding thecompany’s offices.

“The company wasn’tcooperating during the raid, soone employee has beenarrested,” Elif Bagci, aspokeswoman for the Ministryof Environment andInfrastructure’s inspectiondepartment, said by phone.She declined to identify theemployee. The inspectorsraided Uber’s Amsterdam’soffice for additional informationfollowing an inspection lastweek.

“Uber continues to cooperatewith the Dutch authorities, butwants to safeguard the privacyof Uberpop drivers andpassengers,” the company saidin an e-mailed statement sentvia an external communicationsagency. The company didn’timmediately return calls foradditional comment. Uber’sride-sharing applicationUberPop was ruled in violationof local taxi regulations by aDutch court in December. Thetraffic and transport inspectionhas so far caught 27 driversusing the app and Uber wasordered to pay a maximum fineof 100,000 euros ($108,000) onMarch 6. Uber has appealedthe ruling and is still operatingits basic UberPop service whilethe case is pending.

Google fails to dismissprivacy lawsuit overGoogle Wallet

A federal judge hasrejected Google Inc’s

request to dismiss a lawsuitaccusing the technologycompany of invading theprivacy of users of its GoogleWallet electronic paymentservice by sharing theirpersonal information withoutside app developers.

In a decision last week, U.S.District Judge Beth LabsonFreeman in San Jose,California said Google mustface claims it breached users’contracts, violated the federalStored Communications Actwhich limits disclosure ofelectronic records, andviolated a California consumerprotection law. She alsodismissed two other claims.

Freeman said Google Walletusers may try to show thatGoogle “frustrated” thepurpose of its own privacypolicy by allowing “blanket,universal disclosure” of theirpersonal information to appdevelopers whenever theybought apps in Google’s PlayStore.

PREMIER - From left: Meg Otanwa, Damilola Adegbite Attoh, Anee Icha and Beverly Naya,cast in the Airtel Nigeria-sponsored reality TV show “Before 30”, during the premiere inLagos.

Industry analysts havecalled for the repositioning

of the Nigeria Postal Service,NIPOST to unlock the potentialof e-commerce in Nigeria.

Reacting to recent report byFinancial Vanguard on whylocal investors are not investingin e-commerce, a commentatorwho simply identified himselfas Nedum said until theauthorities put in place astructured logistics platform toaddress delivery challenges, e-commerce in Nigeria may neverfare successfully.

According to him,“Distribution is fractured and onits knees,” and that, “UntilNIPOST is totally overhauledand restructured in a way that

‘NIPOST holds key to unlockinge-commerce potential in Nigeria’Stories byJONAH NWOKPOKU

slow delivery of a package fromone end of Nigeria to anotherend of Nigeria will take at leastthree days, Business toConsumer, B2C and Consumerto Consumer, C2C kind of e-

commerce will never beachieved in Nigeria.”

He said, “NIPOST to me isunderutilized. The Federalgovernment should do all itcan to turn NIPOST around tooperate like the mail/packageservice delivery services of anydeveloped countries like theUnited States Parcel Service,USPS. This model can becopied.”

“NIPOST,” he maintained,“has the potential to reshapeNigeria and create anenvironment where ForeignDirect Investments, FDI’swould start gushing into thiscountry.”

He said: “With a revitalizedNIPOST, Nigerian SME’swould be able to reach not justthe Nigerian market, but tapinto the markets of other African

countries around us.”“NIPOST to me is the key to

unlocking e-commerce inNigeria. Reposition NIPOSTand e-commerce willexponentially take off inNigeria,” he added.

Recall that the Ministry ofCommunications Technologyrecently went into partnershipwith online retailer Konga.comto facilitate distribution of itemsbought on Konga shopsthrough the NIPOST outlets inUNILAG. The collaborationwas a pragmatic attempt ataddressing logistics anddelivery issues experienced bye-commerce operators inNigeria.

Also speaking recently, Minister of CommunicationsTechnology, Omobola Johnsonsaid NIPOST is not only beingstatically positioned to addresse-commerce challenges but toalso play a more divergent rolein driving economic growth inthe country especially in areasof financial and digitalinclusion.

She said: “When we look atNIPOST today, we see thebiggest retail infrastructure inthe country, with over 3,000outlets. We see NIPOST at thecentre of three initiatives: thecountry’s financial inclusionstrategy, digital inclusionstrategy and e-commercestrategy. From a financialinclusion point of view,NIPOST has more outlets thanany bank in the country. Theministry of communicationtechnology and the CentralBank are working together sothat NIPOST can become anadditional platform for anybank in the country. Privatesector partners are also neededto help upgrade some of theNIPOST outlets and connectthe 3,000 branches with moderntechnology. At this point, theoutlets can either providephysical banking services orvirtual services, performing therole of mobile money agents.”

Taxi hailing service, Uber,MTN and Etisalat

Nigeria will partner with AllAmber, the organisers oftechnology conferences acrossSub-Saharan Africa, to host the5th edition of Mobile WestAdfrica which will take place inLagos from April 21 to 23, 2015.

Other organisations that haveconfirmed sponsorship and willexhibit at the event includeAirtel Nigeria, Eskimi,VConnect, Gidi Mobile, OperaSoftware, MoboFree,MyMusic, Basebone, Mozilla,Jovago, Wiko Mobile andMTech Communications.

Speaking on the supportreceived from theseorganizations, Founder of AllAmber, Matthew Dawes said:“The amount of industrysupport we’ve received isunprecedented and it’s anillustration of how far the eventhas developed since it started

Uber, others partner All Amber to host Mobile West Africa in 2011. To secure MTN,Airtel and Etisalat – as well asinternational players likeMozilla, Opera and Basebone– and then have the support ofkey local stakeholders such asEskimi, Gidi Mobile, MTechand MoboFree reflects the will

within the industry to keep itmoving forwards.

“The conference has come along way in the last five years,more so than I could havehoped for, and I want it tocontinue to facilitateprogress.

In line with its Corporate SocialResponsibility, CSR thrust, PEP Stores

Nigeria, a retail outlet specialized inclothing, Home wear, footwear, as well asother fast moving consumer goods hasreached out to three orphanages in Nigeria,donating over N20 million worth of items.

Beneficiaries of the gesture include: BethTorry Home for the mentally handicapped,Little Saint Orphanage, and Hearth of GoldHospice which also had part of theirbuildings renovated.

The company spent about N1.5Million infixing doors and furniture at Little Saintbranches in Egbeda, Ogudu and Abole andHeart of Gold in Surulere it donated items

CSR: PEP donates over N20m worth of items to charity (Clothing and Foot wear) valued at aboutN11.5 Million to Little Saints Orphanage,Lagos and another N6.8 Million worth ofitems to Beth Torry Home for the mentallyhandicapped. According to the GeneralManager, PEP Stores Nigeria, Mr. DeonConradie, the donations of the items to theOrphanages and the renovations is in linewith the company’s strong belief in givingback to the society in which it operates as asocially responsible corporate citizen.

“This CSR initiative is part of our brand’sDNA. PEP believes in giving back to thecommunities it serves and each PEP regionis empowered to give back to thecommunities at a local level,” he said.

With a revitalizedNIPOST, NigerianSME’s would be

able to reach not justthe Nigerian market,

but tap into themarkets of otherAfrican countries

around us

CMYK


Insurance

The Nigerian Council ofRegistered InsuranceBrokers, NCRIB,

umbrella body of all insurancebrokers in Nigeria hascharged the in- cominggovernment to ensure thatinsurance is given its pride ofplace in all strata ofgovernment operations.According to the NCRIB, noeconomy could developwithout taken into cognizance the place ofinsurance and riskmanagement.President of the NCRIB, Mr.Ayodapo Shoderu, whocommended the President-elect, General MuhammaduBuhari and applauded theelectoral process for ensuringthat the wishes of Nigerianscounted at the polls,challenged the president-electto start giving serious thoughtsto strategies for growing thenation’s economy through theprovision of infrastructuraldevelopment and creation ofjobs in order to enhancequality lives for Nigerians andby so doing increase theirdisposable income.Shoderu noted that the

NCRIB charges incoming govt to giveinsurance deserved attentionBy ROSEMARY ONUOHA

peaceful conduct of theelection and emergence of anew President has paved theway for the socio-economicand political stability ofNigeria.He also commended theincumbent President,Goodluck Jonathan for

creating an enablingenvironment for furtherdeepening of the democraticprocess, noting that he had byso doing joined theprestigious league of theglobal statesmen and eminentfellows.Shoderu noted that the result

of the election was alreadyimpacting positively on theeconomy, given the responseof market forces to the politicalprocess. According to him“there is an inextricable linkbetween politics and economyand whatever affected onewould definitely affect theother”

The major Europeanreinsurers have posted

very strong full-year resultsfor 2014 and continue to bewell capitalised, withunderwriting results thathave been profitable owing tothe absence of sizeablenatural catastrophes andongoing reserve releases.The reinsurers also show acontinued focus on capitalmanagement, resulting inshare buy-backs andincreased dividendpayments, as well asrepurchasing and replacingexisting hybrid debt.In a new report by A.M Best,titled, “European ReinsurersPost Strong Performances butGrowth Limited,” A.M. Bestanalyses the full-yearfinancials for Lloyd’s and thefour largest Europeanreinsurers – Munich Re,Swiss Re, Hannover Re andSCOR SE. The report alsoidentifies trends among thesix listed (re)insurersoperating at Lloyd’s – Amlin,Beazley, Brit, Catlin, Hiscoxand Novae.The report notes that thequest for yield is leading toan adjustment in investmentportfolios, although Londonmarket companies remain

European reinsurers post strong performances but growth limited - report

more conservative. “Thelargest four reinsurers andLloyd’s have posted goodinvestment results, withreturns on investment (ROIs)of between 2% to 4.6% in2014,” said Carlos Wong-Fupuy, senior director,analytics. He added: “Theseare encouraging given thelow interest rateenvironment; however, A.M.Best observes that returns arebeing driven partly byhistorical f ixed interestinvestments, which are stillgenerating relatively highyields, and realised gains onequities and real estate.”The major reinsurers allenjoy strong capitalisation,as measured by A.M. Best’sproprietary capital model,Best’s Capital AdequacyRatio (BCAR), yet sti l lachieve a strong return oncapital and surplus. As yieldsare at record lows in othereconomic sectors, investorsremain attracted to thereinsurance market.According to the report,reinsurers face challenges assoft market conditions persistand concerns mountregarding the sustainabilityof reserve releases.

Catherine Thomas, director,analytics, said: “Organicgrowth is limited, with ratesremaining under pressureand certain lines of businessunderperforming, leading toa need to underwrite risksmore selectively. Reinsurersare seeking opportunities forexpansion into emergingmarkets and new lines ofbusiness.”Reinsurance rates and terms

and conditions are undercompetitive pressure fromalternative capital, asevidenced by the 1 Januaryrenewal period. In A.M.Best’s opinion, further pricereductions are likely.Traditional and alternativecapacity remains plentifuland a single largecatastrophe is not expectedto have a significant impacton current marketconditions.Yvette Essen, director,industry research, Europe &emerging markets, noted:“Major losses combinedwith a sustained recovery ininterest rates could reducethe sector’s attractiveness toalternative capital.However, the exceptionallylow yield environment isexpected to continue withany increases in interestrates likely to be gradual.Furthermore, alternativecapital is increasinglyprovided by pension fundsrather than opportunisticinvestors, which may be lesslikely to reallocate theirinvestments given thatinsurance-linked securitiesrepresent only a relativelysmall proportion of theirsubstantial asset portfolios.”

Organic growthis limited, withrates remainingunder pressureand certainlines ofbusinessunderperforming,leading to aneed tounderwrite risksmoreselectively

Mansard Insurance plc’so u t s t a n d i n g

performance has again beenrecognized as it was selectedas one of the top quartile(first place in InsuranceCategory) of publicly listedGrowth Strategy Leaders inNigeria for the year 2015awards season. This awardhonors “best of the best”growth companies listed onthe Nigerian Stock Exchangein Nigeria and waspresented by MSY Analytics,(a teaming partner andNigerian representative ofglobal research and growthconsulting giant, Frost &Sullivan).According to MSY analytics,‘Using a weighted scoringmethodology, theperformance and financialsof all publicly tradedcompanies on NigerianStock Exchange (NSE) as ofDecember 31, 2014 wereevaluated across severalmetrics such as totalshareholder returns, revenuegrowth and profitabilitygrowth. From within thispool, we selected elite groupof ten top companies perindustry and Mansardranked #1 in the InsuranceIndustry.”The organizers furtherdisclosed that emerging andfrontier markets representover 50% of world GDP & over2/3 of global growth and thusa strategic focus area forinvestors around the world. While African continent ishome to several of thesemarkets, Nigeria (a keyfrontier market) enjoys aunique position as thelargest GDP in Africa. Moreover, Nigerian StockMarket was among the 10best performing markets around the world during2013 and is expected to bean attractive market for bothdomestic as well as globalinvestors for coming decades.On receiving the award, Mr.Taiwo Adeleye, Head ofMansard’s Marketing andCorporate CommunicationsGroup, appreciated MSYAnalytics for the honouraccorded Mansard and henoted that Mansard hasremained the biggestinsurance company on theNigerian Stock Exchange forseveral years.The 2015 Growth StrategyLeaders award waspresented during theWharton Club of Africa(WCA) Executive InvestmentSummit & CEO Forum 2015in Lagos.

Mansard getstop place ininsurance sector

SEMINAR - From Left: Mr Asamah Kadiri; Mr Obafemi Agaba, Partners, Jackson, Etti & Edu(JEE); Mr Sola Dosunmu, Head, Corporate & Regulatory, British American Tobacco Nig Ltd;Mrs Uwa Ohiku, Partner, JEE; Mrs Imomoemi Ibisik,; Group Head, Legal Services, HeritageBank Ltd; Mr Yomi Badejo Okusanya, MD/CEO, CMC Connect Burson Marsteller; Mr BodeSojobi, Head, Legal Services CHI Ltd; Mr Koye Edu, Managing Partner, JEE; at a seminar onDispute Resolution and Crisis Management of Corporate Entities hosted by JEE.


Successful nations:According to Prof. Peter

Onwualu, if Nigeria invests inresearchers and researchinstitutions, she will join theleague of successful nations."Name any successfulcountry and you discoverthat the bedrock of theirsuccess is research done byboth government and privatesector. The results of suchresearches actually fuel theeconomy. A country likeChina has used research tocome up with new productsit is exporting.

"For instance, more andmore research is being doneto improve on the telephone.When the mobile handsetcame out, it was just formaking and receiving calls.Somebody did research andfound they can incorporatea camera, video, clock,calculator, etc. These are allproducts of research and it isin all sectors of theeconomy,” he said.

Health: "Today, whenNigerians are seriously ill,they go abroad and you beginto wonder what the problemis? Is it that our medicaldoctors are not properlytrained? No! We’ve seenevidence that they performbetter than others when theygo abroad. The onlydifference is that in Nigeria,they do not have access totechnology. It is difficult toget specialized equipmentfor cardiology, cancerdetection, heart diseases etcbecause we are not doingenough research in thesector. Nobody is producinghospital equipment inNigeria and because they arevery costly, the averagehospital in Nigeria cannotafford them. People aredoing research on how totreat cancer with very hightechnology with little sideeffects.

Election: "In developedcountries, it is almostimpossible to rig electionsbecause they use technologybut in Nigeria, we have not

Research can lead to jobs, security

Nigeria is suffering from unemployment andinsecurity because over the years, we haveneglected the aspect of research. If we do

proper research and commercialise it, then it canlead to emergence of industries and these industrieswill first generate a lot of income, products andemployment and Nigeria will be a better place tolive in,” These were the words of Professor PeterOnwualu, former Director-General and ChiefExecutive Officer of Raw Materials Research andDevelopment Council (RMRDC) and a visitingprofessor at the National Universities Commission.He spoke with Vanguard recently.

Excerpts:been able to properlycapture something as simpleas biometrics. But withproper research to come upwith the requiredtechnology, even if I amregistered in Abuja, I shouldbe able to vote anywhere.

"What research does in acommunity is unimaginableand the problem we have inNigeria is that we have notpaid adequate attention toresearch. The FederalGovernment has been tryingbecause the innovation/research sector in Nigeria ishuge, the biggest in Africa."

Poor funding ofresearch institutes:

"Why is it that with all theseinstitutions, we are notbenefitting from the result ofresearch? Over the years, theresearch institutions havenot been properly fundedand so they have not grownto keep pace with the times.Some of the laboratories areoutdated and so theresearchers are not able to dothe kind of research they aresupposed to be doing;researchers don’t get enoughfunds to do research that canimpact the society. Part of theproblem is that most of theseresearch institutes arefunded by government andwe have all seen that it isimpossible for governmentto do everything. The privatesector has not beenforthcoming in terms ofsupporting researchers andyet, they are the beneficiariesof some of these researchworks. Unfortunately, mostof the big industries thatshould be supportingresearch have their R&D basein their parent countries.That is why many of them shyaway from supportingresearch. Otherwise, if theyhave problems, they will runto researchers who caninvestigate the problem andproffer solution," he stated.

Investing incommercialisation:

"Part of what I have beendoing at NUC is to look at the

models of research-industryrelationships that can workand promotecommercialisation. Many ofthese results from ourresearch institutes are still inthe labs and workshops. Theyget caught up in what is calledthe valley of death. Youdevelop something and just atthe point of getting it to themarket, it falls into the valleyof death and that is the end.

"That is why you hear thatMr. A invented a car andbefore you know it, the storydies down. It is because aresearcher comes up with anidea/product, and to get it intothe market, he must have a

By EBELE ORAKPO

•Professor Peter Onwualu

If theresearchercomes up withsomethingthat ispatentable, itwill bepatented andthe industrycannot stealthe idea fromhim

f a c t o r ywhere it willb emanufacturedand that is ad i f f e r e n tt h i n galtogether,investing incommercialisation.

C o n c e p tof triplehelix:

"In 2014, Idid aresearch tocome upwith policiesthat canb r i n gresearchersa n di n d u s t r y

together which resulted inwhat we call the Concept ofthe triple helix. This meansthere are three groups ofpeople that must worktogether in a helix form -government, researchersand industry/entrepreneurs. The reasonscollaboration among thethree has not been verystrong are:

Trust: A lot ofindustrialists hide undertrade secret and don’t opentheir doors to people,including researchers. Thedeveloped world has solvedthis problem throughintellectual property,trademarks etc. Once youhave a very good intellectualproperty regime, if aresearcher is going to workwith an industry, they signnon-disclosure documentsso that if you come into thefactory and you see sometrade secrets, you don’t goand reveal them. At the sametime, if the researcher comesup with something that ispatentable, it will be patentedand the industry cannotsteal the idea from him. Onceyou have that legalframework, people can worktogether."

R&D: "Many industries arenot ready to spend money onproduct development; theyare more interested in justproducing and making profit.We found that in other places,government uses some policyincentives to encourageindustries to spend money onresearch. If you are producingA and every year you make N1billion profit which is taxed, ifwe have a policy that says youcan devote 10 per cent of theN1b on looking for ways to

improve the product and gettax rebate for doing that, itbecomes an incentive for theindustry and many will behappy to comply.

"We also recommended onescheme called KnowledgeTransfer Scheme where anindustry and a researchinstitution form apartnership. Example, anindustry that produces fruitjuice wants to come up with anew product - mixed fruits.They need to do someresearch.

"Under this partnership, aresearcher in food science,food technology or foodengineering can leave theuniversity for six months ormore and be resident in thefactory, working to come upwith this new product.

"Once he succeeds and theyare producing, he goes backto his university. This way,he gains a lot of practicalknowledge which willimprove his teaching; at thesame time, the industry hasbenefited from hisknowledge. It is a win-winsituation. But for this towork, somebody has to pickup the bills and since mostindustries may not want topay, this is wheregovernment can come in.Government can pay or if theindustry pays, governmentcan reduce their tax.

"If this is followed through,these industries can begin tolook at how to add value toour natural resources andthen the economy willnaturally grow, you willhave more and moreindustries springing up,creating jobs, processingour raw materials and whenthese industries arethriving, they pay tax. So inour national budget, you willnot only see crude oil, youwill also see corporate taxfrom industries operatingwithin the economy.

Wake-up call:"So I believe that research

has a lot to contributetowards the development ofthe Nigerian economy. This isthe time for us as a nation towake up.

As an engineer, I can pick aphone and within 30minutes, I can tear it apart andbring it back together. If I amable to do that, it means I canmake a phone but how do Ido that? I must have thosemachines required to couplethem together and these aremachine tools which we arenot yet producing here.

People in Business


Aviation

Director General of theNigerian Civil Aviation

Authority of Nigeria (NCAA),Capt. Muhktar Usman hassaid that the MurtalaMuhammed InternationalAirport (MMIA), Lagos andthe Nnamdi AzikeweInternational Airport, Abujawill soon be certified by theagency.

Disclosing thisdevelopment to newsmenduring an interactive session,Capt. Usman pointed out thatwork at the two internationalairports were at advancedstages adding that as soon asthe work were completed, theairports will be commissioned.

According to him, “Againstthe backdrop that no airportis certified in Nigeria, NCAAis working tirelessly to ensurethat the Lagos and Abujaairports are certified. Workhave reached advance stagein those two airports and wehope that sooner than youthink, they will be certified.”

He further noted that theagency is adequatelypreparing for the Universal

Lagos, Abuja airports to be certified soonBy LAWANI MIKAIRU& DANIEL ETEGHE

Safety Assessment Audit inJune by the InternationalCivil Aviation Organisation(ICAO) stressing that theagency was currentlyengaging its workers inrigorous training programmefor this purpose.

“On the audit, we arepreparing for the audit, thereare processes and we havestarted it in terms ofmanpower training andretraining, equipment and allthe necessary things that

needed to be done. I amhopeful that we will scalethrough the audit” Capt.Usman noted.

Also, he stressed that on theallegation that NCAAdismissed 187 workers lastyear which were yet to berecalled by the agency, hesaid that the FederalGovernment has set up acommittee to look into thematter adding that whateverdecision reached by thegovernment will be binding

on the agency.Capt. Usman further

pointed out that as the newDG of the agency he wasgoing to bring his wealth ofexperiences that he hasgathered over the years in theindustry just as he noted thathe left as Commissioner of theAccident InvestigationBureau before assumingoffice as the DG assuring thatbefore his 5 years term expireshe would ensure safety in theaviation industry at all times.

As Christians celebrateEaster, air travellers in

the country have been advisedto adhere strictly to airport rulesand regulations in order tohave seamless trips.

Easter: FAAN cautions air travelers on airport rules

By LAWANI MIKAIRU& DANIEL ETEGHE

The General Manager,Corporate Communications,Federal Airports Authority ofNigeria, FAAN, Mr YakubuDati in an interview with someaviation correspondents onmeasures put in place by theorganisation to ensure a hitchfree passengers movement

advised intending airpassengers to take advantageof passenger service portal toplan their trips.

According to Dati, “intendingair passengers can getnecessary information neededsuch as airline delays, on timedepartures and flightcancellations fromwww.aviationportal.com.ngbefore embarking on theirtrips”.

He also cautionedpassengers not to carry onboard prohibited items such asliquids and inflammable itemsstressing that such items mustbe checked in adding thatfailure to do so will attractseizure at check-in points.

Dati further advisedtravellers on international tripto approach the screeningpoints as soon as they check into avoid delays.

He advised them to securetheir luggage and should notbe left in the hands of anyoneat the airport adding that anyluggage left unattended will bedestroyed by security agents.

He further said FAAN in linewith the minister’s directivehas concluded plans to ensurethat no single tout wasoperating at airports.

The Nigerian Meteorological Agency,NIMET, has drawn the attention of

road users and airlines to improvement inthe visibility of the atmosphere as the dusthaze clears off in most parts of the countryfrom the weekend. NIMET, in a statementmade available to our correspondent in Abujalast Thursday, said, the dust will begin toclear in the coming days and improvevisibility as the days go by.

According to the agency, “As the pressuresystem continue to weaken in the comingdays, and the moisture laden southwesterlywinds from the ocean continue to advanceinland, the dust particles will begin to clearand the visibility will also improveprogressively northwards in the comingdays.” It had predicted that from April 2, 2015,the country would experience poor visibilityin moderate dust haze in some parts of the

NIMET alerts road users, airlines on improved visibilityBy FAVOUR NNABUGWU country that would reduce visibility to as low

as 200 meters in States like Maiduguri andto 800 meters in Gombe.

According to the Nigerian MeteorologicalAgency, the development has led toreduction in visibility in some parts of thecountry to as low as 300 metres and thesituation will prevail for a while.

Contrary to that, the agency said theimprove visibility will not affect flightoperations adversely like it earlier didbecause the atmosphere (especially thesouth and central states) is already havingenough moisture to cause the raised particlesto fall off the atmosphere early leading toimproved visibility.

The agency which gave the dust forecaston January 7, and April 2, 2015 respectively,informed the public of possibility of dustoutbreak that will affect parts of the countryup to the month of April 2015 when theNortheasterly winds will still be dominantover the northern region.

NCAT graduates 12ATC CadetsEfforts by the Nigerian

A i r s p a c eManagement Agency,NAMA, to boost criticalmanpower capacity weregiven a boost lastWednesday, as theNigerian College ofAviation Technology,NCAT,Zaria, graduated a set of 12cadet Air TrafficControllers on BasicAerodrome and ApproachControl Course as well asFlight Training. The ATCCadets who began thetraining early last year willcommence on-the-jobtraining (OJT) in somedesignated airports acrossthe country for the BasicAir Traffic Control License.

Meanwhile, theManaging Director of theagency, Engr. IbrahimAbdulsalam hascommended the cadetATCs for their ‘’hard workand perseverancethroughout the trainingperiod leading to asuccessful and impressiveresult”. In a statement,Engr. Abdulsalamexpressed delight that ‘’theagency is makingremarkable progress inbridging the manpowergap in the critical sector ofoperations”.

AISAN holdsinteractive sessionwith operatorsThe Muritala

M u h a m m e dInternational Airport,MMIA, branch of theAeronautical InformationServices Association ofNigeria (AISAN) has heldan interactive forum withairline operators and otherend users of aeronauticalinformation in order toappreciate customersatisfaction with itsservices. AIS as a keydepartment in NAMAprovides critical informationthat ensures safety andsecurity for airspace users.

The forum which wasattended by representativesof airlines, aviation agenciesand the Nigerian Air Forceprovided the opportunity forstakeholders to exchangeideas on how aeronauticalinformation could best bemanaged anddisseminated. In herremarks at the occasion,AISAN Chairman, MrsTitilayo Ayinde taskedeveryone to cooperate withthe agency as it strives tofast track the AISAutomation project.

On the audit, weare preparing forthe audit, there areprocesses and wehave started it interms of manpowertraining andretraining,equipment and allthe necessarythings that neededto be done

DEBATE - From left: Dr Bright Okogu, Director-General, Budget Office of the Federation; MrDemola Akinrele, SAN; Prof. Bolaji Akinyemi, former foreign Affairs Minister; Mr AkinfelaAkoni, President, Executive Committee, The Oxbridge Debate 2015; and Prof. Konyin Ajayi,Moderator, during the debate organised by The Oxford and Cambridge Club of Nigeria. Photoby Lamidi Bamidele


CMYK


Economy

In the heat of the just concluded electioneering cam-

paigns for presidency, Nigeri-an businesses appeared veryconfident that the economywould bounce back from thelow keyed first quarter 2015.This was the outcome of theBusiness Expectations Surveyby the Central Bank of Nigeria(CBN) recently conducted andreleased last week in Abuja.

Respondents were drawnfrom the Industrial, Construc-tion, Wholesale/Retail Tradeand Services sectors made upof: Financial Intermediation,Hotels and Restaurants, Rent-ing and Business Activities andCommunity and Social Servic-es.

The overall confidence index(CI) which stood at 8.4 indexpoints indicates the respond-ent firms optimism on the mac-ro economy as the businesscondition in Nigeria is expect-ed to improve in First quarter(Q1) 2015. The respondentswere reacting just before theelections were postponed fromthe earlier February dates.

At 46.4 points, the overall CIfor second quarter (Q2, 2015)indicates that the respondentsexpect that the macro economywould improve. The optimismin Q1 2015 is driven by theopinion of respondents fromthe services sector (4.4 points),

Amidst election fever,business communitysustains confidence

Stories byEMEKA ANAETO,Economy Editor

followed by wholesale/retailtrade (2.7 points) and indus-trial (1.9 points).

Also, the expected drivers forthe optimism on the macroeconomy in the second quar-ter are services (17.9 points),wholesale/retail trade (13.9points), industrial (10.3 points)and construction sectors (4.3points).

In the survey on Macro eco-nomic outlook by type and sizeof business the drivers by typeof business for the optimism onthe macro economy in the firstquarter are ‘neither importer

•Godwin Emefiole, CBN Governor

nor exporter’ category (7.5 percent), followed by ‘importer’category of respondents (0.8 per

cent) and ‘exporter’ category(0.3 per cent).

The percentage distribution ofrespondent firms by type ofbusiness shows that ‘neitherimporter nor exporter’ catego-ry of the respondents consti-tutes the highest percentage ofresponses (73.0 per cent), fol-lowed by ‘importer’ (16.5 percent), ‘both importer and ex-porter’ (7.9 per cent) and ‘ex-porter’ (2.6 per cent).

The drivers by size of busi-ness for the optimism on themacro economy in the firstquarter are the small, mediumand large firms whose contri-butions are 6.3, 1.3 and 0.7 percent, respectively.

The percentage distribution ofrespondent firms by employ-ment size shows that small sizefirms constitute the highestpercentage of responses (78.6per cent), followed by mediumsize firms (14.2 per cent), andlarge size firms ( 7.2 per cent).

In the Business Outlook In-dex on the Macro Economy bySector the survey shows thatBusiness sentiment across allsectors was optimistic in the

first quarter and likely to re-main so in the second quarter.

The indices of the services,wholesale/retail and industrialsectors stood at 12.6, 10.0 and7.5 points, respectively. Theconstruction sector was howev-er downbeat at –4.3 points inthe review quarter.

The distribution of respond-ent firms by sector shows thatservices sector constitutes thehighest number of responses(653), followed by wholesale/retail (508), industrial (465) andconstruction (254).

In the survey of BusinessConfidence on Own Opera-tions by Sector the respondents’confidence index on own op-erations in the first quarter wasless optimistic across all sectorswhen compared to the level ayear ago. The confidence indexof services, wholesale/retailtrade, industrial and construc-tion sectors stood at 20.8, 15.2,6.5 and –5.9 in Q1, 2015 fromtheir levels of 24.5, 23.3, 19.3and 16.7 in the correspondingquarter of 2014, respectively.

The average capacity utiliza-tion index (CUI) at 15.0 pointsin Q1, 2015 dipped by 12.6points when compared with the27.6 points achieved a yearearlier.

In the survey of Access toCredit and Financial Condi-tions The financial conditionindex in the first quarter stoodat 12.1 per cent and was driv-en by the services (7.2 points),wholesale /retail trade (4.1points) and industrial sector(1.6 points).

Respondents’ optimism in thevolume of total order and theinternal liquidity position, bu-oyed the volume of their busi-ness activities in the first quar-ter. Similarly, the positive out-look in access to credit by themajority of firms upped the fi-nancial condition of firms in thereview quarter.

The Central Bank of Nigeria (CBN)has released its report on credit

conditions in the financial system. Ac-cording to the report the availability ofsecured credit to households decreasedin the first quarter of 2015. The apexbank however said this condition is ex-pected to reverse in the second quarter.CBN also said changing liquidity posi-tions remained a major factor behind thedecrease while lenders (banks) furtherreported that tight wholesale fundingconditions also made significant contri-butions.

However the banks reported that theavailability of unsecured credit to house-holds increased in Q1, 2015 and it isexpected to increase further in Q2,2015.They also reported that changing cost/

Supply of Credit improved in Q1 2015 — CBNavailability of funds, market share ob-jectives and changing appetite for riskcontributed to the increased availabili-ty of unsecured credit in Q1, 2015.

The overall availability of credit to thecorporate sector increased in Q1 2015and was expected to increase furtherin Q2, 2015. The important factors con-tributing to increased credit availabili-ty, according to CBN, were changingsector specific risks, changing economicoutlook and market share objective.

On the demand side of the creditmarket, according to the CBN report,demand for secured lending for housepurchase and consumer loans increasedin Q1 2015, and were expected to in-crease further in Q2, 2015. Despitelenders stance in tightening the credit

scoring criteria in the first quarter, theCBN report indicated that the propor-tion of loan applications approved in Q1,2015 increased. Demand for unsecuredcredit card lending and an overdraft/personal loan from households increasedin the first quarter, and are expected tofurther increase in the second quarter.

However, demand for unsecured creditcard lending from small businesses wasexpected to decrease in Q1, 2015, whiledemand for overdraft/personal loansfrom small businesses was expected tofurther increase.

In spite of the tightening in the creditscoring criteria in total unsecured loanapplications in Q1 2015, the proportionof approved households total loan ap-plications improved in the first quarter.

The drivers by sizeof business for theoptimism on themacro economy inthe first quarter arethe small, mediumand large firms

CMYK


CMYK

Advertising & Promotions

Overtime, legend extrastout has continued to

position itself as a credible stoutchoice in the stout market,despite daunting challenges.

This invariably has given itthe toga the ‘Real Deal.’ Thisproposition has howeversustained the brand’s growthsince its re-launch in 2009 inthe midst of other high profilestout brands; like Williams DarkAle, Wilfort, Castle beer whichhave been playing in theregional markets, except forGuinness and Castle beer.

Legend’s current campaigntagged: ‘Taste and Tell,’ whichberthed in Owerri, Imo state,precisely, Umunkoto on theever busy Nekede road cannotbe mistaken for a town meetinggoing by the gathering.

With displays, even a visitorcould tell something was up inthe vicinity. The event was the2nd edition of the Legend ExtraStout, ‘Taste and Tell’ campaignwhich had transversed parts ofLagos and Benin, rewardingconsumers who took the blindtaste test, and able todifferentiate Legend stout fromthe three glasses filled withother stout brands marked ‘A’ to‘C.’

The venue littered with a fewother brands from NigerianBreweries, NB Plc, whereconsumers swayed tocontemporary hit songs fromthe blast of strategicallypositioned speakers within thearena. The event went full blastwhen the compere De-Doncame on stage reeling out ribcracking jokes hulled at the Igboextraction.

Like the Lagos and Beninactivations which featuredYoruba and Benin culturalperformances respectively, theOwerri leg also featured aperformance by ‘Nna NyeluUgo’ cultural group. Theaudience were taken aback tothe soulful rendition oftraditional folk songs.

However, the high point of theevent was when the audienceplayed the ‘Taste & Tell game.The ‘taste-and-tell’ game,involved a blind taste gamewhere volunteer tasters tasteseveral drinks poured into cupsmarked ‘A’ to ‘C’ after whichthey were asked to identify thecup that contained LegendExtra stout. Participants whocorrectly identified the cup wererewarded with prizes such as9.5kva generating set, LED TVand a refrigerator among otherthings.

The game conducted in

Positioning: WhenLegend consumers takeblind ‘Taste to Tell’

batches of three volunteertasters produced two out of thethree tasters- Vitalis Chilaka, a300 Level under graduate ofQuantity surveying, FederalPolytechnic, Uwana, andAugustine Chukwuebuka, andupcoming artiste correctlyidentified the glass thatcontained Legend Extra Stoutafter tasting the unidentifieddrinks in the first batch. Fortheir feat, Vitalis and Agustinewere rewarded with a 32’ inchLED TV and refrigeratorrespectively.

Reacting to their winnings theduo attributed it to their loyaltyto the Legend brand for a long

time during which period theyhave become accustomed to thebitter taste of the brand.

From Augustine, “Legend hasbeen my best drink for overfour years now. You can’t beloyal to a brand like that andfail to distinguish it from otherbrands even when blindfolded. Almost all stout brandshave bitter taste, but the bittertaste of Legend Extra Stout isunique”.

Gift Chukwuoti, a 500Lmedical Student at theUniversity of Nigeria, Nsukkaemerged the winner in thethird batch and was rewardedwith a 9.5kva generating set.His words: “this is quitesurprising for me; I’m reallyshort of words. “I’ve been aLegend Extra Stout loyalist forfour years now, so I couldn’thave missed that unique bittertaste.”

STORIES BY PRINCEWILLEKWUJURU

Purchasing direct airtimehas become the new

phenomenon taking placebetween banks and mobileservice providers, Access Bankjoined the fray while depoying‘Easy-top-up’ as its customerscan now buy airtime directly.

‘Easy-top-up,’ is a quick,convenient airtime rechargeservice which discards use ofphysical recharge cards orPINS. With the product,account holders can buy airtimefrom any network by dialing adedicated code *901*Amount#.

It could be recalled that in theearly days of GSM, subscribershad to struggle to buy rechargecards from vendors, whosometimes are not within reach.Although different steps havebeen taken to resolve thechallenge especially with theintroduction of online rechargewhereby one needs to gothrough the steps to log ontoan internet banking platformjust to buy airtime. The banksaid when a customer’s airtimeruns low, a quick way torecharge is by dialing the code,within seconds the customer’sairtime is credited even when

Access Bank deploys ‘Easy-top-up’ for airtime recharge

the customer has zero Naira inhis or her phone.

In keeping with itscommitment to inclusivebanking services andchannels,the bank said it hadensured that its products andservices appeal to every sectorof the Nigerian economy aswell as the retail segment, fromthe young and elderly, to thestudent and the professional.

However, the bank theservice is restricted to only itsaccount holders with dailytransaction limit of N5,000.Regardless of time andlocation, customers canrecharge at their convenienceas long as the customer has aphone and Access Bankaccount.

The top up amount is debiteddirectly from the Customer’saccount. The service is instant,available 24/7, 365 days a yearand compatible with all mobilenetworks in the country, thebank stated. As part of itscontinued growth strategy,Access Bank said its focused onmainstreaming sustainablebusiness practices into itsoperations. The Bank strives to

deliver sustainable economicgrowth that is profitable,environmentally responsibleand socially relevant it noted.

Group Managing Director/CEO of Access Bank, HerbertWigwe said, “our primaryinspiration in developing theseproducts is our increasinglytechnology savvy customerbase; a customer base thatwants to be empowered withself-service options that enablethem take charge of the waythey live, work and play. Bycreating and disseminatingthese products we not onlyspread financial services to anever increasing proportion ofthe population but also wakeup dead capital.”

Speaking of the product,Head of Product Management& Innovation, OlugbengaAgboola, said, the bank has flairfor creating technology driven-services that are sustainable,scalable that can meet localneeds adequately.

“Access Bank’s ‘Easy-top-up’is an example of such servicewith a strong focus on creating“moments of pure delights” forour customers.

Cloned versionof Share-A-Cokecampaign mayhit marketA cloned version of the

S h a r e - A - C o k ecampaign embarked upon byCoca Cola Nigeria Limited,CCNL, may hit the marketsoon. Owners of thecampaign who havecomplained of the intentionof a competing brand to copythe campaign declined tomake further comments onthe issue, saying it becameprivy of the move as marketindicators showed that thecampaign has recorded anunprecedented milestone inthe annals of the brand’sexistence.

Investigation conducted byVanguard revealed thatmany carbonated soft drink,CSD’s manufacturersdeclined to comment on theissue, this thus prompted theinvestigator to sample theopinion of brand consultants.

Mr. Mukaila Oladosu,Director Interbrands in hisopinion said that Coke hasremained number one notbecause its been mostprofitable, but because of topof the mind awarenesscreation. Though in Nigeria,there have been some lull inits marketing efforts, but onlyrecently it came again moreradically and more creativelyin such a way that it has abonding relationship withconsumer. I am talking abouttheir Share a Coke campaign.

NIMN inducts24 new fellows

..as Koledoye gets staffof office

The National Institute ofMarketing of Nigeria

(NIMN), recently inducted24 prominent Nigerians asfellows of the institute.

With 18 of the fellows wereupgraded from associatemembership of the institute tofellows, 6 others wereprominent Nigerianprofessionals who hadcontributed their quota to thedevelopment of marketing practice in the country.

The institute also held aninvestiture ceremony for thepresident and chairman ofCouncil of the institute, Mr.Ganiyu Koledoye, to formallyinaugurate the new council ofthe institute. Koledoye who wasformally handed the staff ofoffice at the elaborate marketingevent, witnessed by notablemarketing practitioners in thecountry, would run the affairsof the institute for the next twoyears.

ACTIVATION - From: Left: Emanuel Agu, MarketingManager, Lager and Stout, Nigerian Breweries Plc., GiftChukwuoti, winner of 9.5kva generating set, and PaulEhioghae, Area Sales Manager, Owerri, also of NigerianBreweries Plc., during the Legend Extra Stout Taste &Tellactivation in Owerri.

This propositionhas howeversustained thebrand’s growthsince its re-launchin 2009 in themidst of otherhigh profile stoutbrands

Business & Economy

Email:[email protected], [email protected] page:www.lesleba.com/blog2Website: www.lesleba.comTel:0805 220 1997


CMYK

Omoh Gabriel - Group Business EditorBabajide Komolafe - Deputy Business EditorClara Nwachukwu - Energy EditorPeter Egwuatu - Asst. Business EditorYinka Kolawole - Snr Bus. CorrespondentFavour Nnabugwu - Insurance CorrespondentGodwin Oritse - Maritime CorrespondentGodfrey Bivbere - Maritime CorrespondentMichael Eboh - Energy ReporterFranklin Alli - Industry/Agric. ReporterIfeyinwa Obi - Maritime ReporterRosemary Onuoha - Insurance ReporterNkiruka Nnorom - Capital Market Reporter

CONTRIBUTORSPrincewill Ekwujuru - Media/MarketingJonah Nwokpoku - E-CommerceNaomi Uzor - IndustryProvidence Obuh - Micro FinanceLAYOUT - Graphics Department

Expectedly, goodwillmessages have

deservedly, poured in from farand wide to congratulate theclear victor of the 2015 electionsand President Elect,Mohammed Buhari, may notbe unduly disturbed thatPresident Jonathan’sinspirational and totallyunexpected early acceptance ofdefeat, ironically, favorablyraised the incumbent’s ratingas a statesman beyond thepedestrian perception inducedby his performance ingovernance. Indeed, despitethe complimentary economicgrowth rates gleefullypresented by Ngozi OkonjoIweala, sadly, more Nigeriansjoined the already bloatedpoverty ranks. Indeed, thehorrid level of insecurity,apparently instigated by ethnicand religious divide, may infactfind their true origin in thepervading level of povertynationwide.

Consequently, expectationsare high that Buhari willprovide an antidote to povertyand corruption; clearly, ourpoverty cannot be blamed onan inhospitable climate or ashortage of natural resources.Infact, citizens from nationswith considerably less naturalendowments may be excusedfor decrying what theyconsider to be an inexplicableinequity by Providence. Inreality, our inability togalvanise our resources to thegreater benefit of the criticalmass is actually caused by theapplication of fiscal andmonetary strategies that areantagonistic to consumerdemand, and job creation.

Consequently, if Buhari mustsucceed, he would need toquickly reverse the ratiobetween capital and recurrentexpenditure, such that wellover 60% of total annualrevenue projections would bededicated to the enhancementof social infrastructure andhuman capacity in place of the

Buhari and the economy:Which way forward?prevailing humonguos salariesand allowances of publicservants.

Clearly, Buhari would needto also reduce the duplicationof functions by various MDASas per the recommendations inthe Oronsanye report, butgovernment must be careful tominimise the inflow of newentrants into a jobless market.Similarly, the newadministration should be waryof increasing the current debtto GDP ratio, as this is a sureroad to another oppressive debtburden. A situation where arelatively stable nation likeNigeria with its immensereserves and resources borrowsat Shylock rates of over 15% istotally unacceptable for whatare clearly risk free soverigndebts. Furthermore, Buharimust immediately interrogatewhy our foreign reserves earnminimal interest, while weinexplicably go cap in hand toborrow externally at over 7%interest rate.

Incidentally, the yet to beassented 2015 budget,accommodates about 20%deficit; consequently,government will borrow overN1Trillion Naira and paybetween N100- N150bn asinterest charges to fund part ofits recurrent (consumables andsalaries etc.) budget. It isironical that such hugegovernment borrowings willexist simultaneously with theunyielding ‘obstructive’ Nairasurplus deliberately created bythe CBN.

Buhari’s Team must therefore,hit the ground running andreadily jettison Jonathan’s2015 budget proposal, so thata fresh Appropriation bill canbe presented to the NationalAssembly before July 2015.

We may also consider 29thMay to May 28th as fiscal yearto align with our establishedElection Time Table and therebyprevent politically inducedbudget truncation on theadvent of a new Leadershiphalfway into the year.

Furthermore, in view of theabysmal performance in thepower sector, Buhari shouldtake a closer look at howNigerians were left with overN400bn debt after theprivatization of the distributionNetwork of the former PHCN.It is equally curious that almost2 years thereafter, governmentcontinues to breastfeed theDiscos with selective interestwaivers, which have notguaranteed low tariffs orimproved performance. Inview of cost implications, thenew dispensation shouldadvisedly fast track theadoption of gas for generatingpower, as gas is considerablycheaper at below $3/cubit mitreand remains a much cleanerform of energy; besides our gasreserves are multiple times inexcess of crude oil reserves.

Furthermore, Buhari willequally need to shine his eyes

in the area of monetary policyand strategy. As a first step, hisAdministration should put astop to the looting of publicfunds with the obnoxiousTreasury Bills Scam.

An arrangement where banksare positioned to make overN600bn in 2015 as interest ongovernment loans, which arenot applied to any productiveor socially enhancing purpose,is clearly obscene. Insuccessful economies,Monetary authorities mop upor reduce any burdensomesurplus cash in the system byborrowing at minimal ratesbelow 2%. When governmentborrows at 10% and above forwhat are essentially risk freesovereign debts, banksexpectedly become reluctant tolend to other borrowers, thuscrowding out the real sectorfrom the cheaper investiblefunds which could spurenterprise and industrialproduction and create morejobs. The President Electshould not be hoodwinked byCBN’s usual propaganda thatinflation, interest and exchangerates cannot remainharmonious; clearly, in severalsuccessful countries, therespective Central Bankmonetary policy rateconsistently remains below 3%rather the oppressive 13%currently adopted by CBN.Furthermore, inflation ratesabove 3% are also anathema tosocial welfare and thereforedecried in more successfuleconomies; regrettably, weshamelessly celebrate inflationrates which are nearer 10%,despite the reality that all staticincomes would lose over 50%of purchasing value every 5years in such event. The incomecontraction caused by inflation

is responsible for the apparentincreasing poverty observedamongst pensioners andretirees as unjust reward forservice to their fatherland.

Additionally, high inflationrates also constrain consumerdemand, which normallydrives investment andindustrial expansion decisions,to create those jobs, whichreduce the unemployment rate.

Buhari is clearly aware thatNaira devaluation onlyfacilitates deepening povertyas clearly evident as the Nairasteadily fell from its exaltedexchange rate of a strongerNaira to a dollar; conversely, astronger Naira will lift moreNigerians from poverty.Similarly, Buhari shouldinterrogate why the Nairaexchange rate steadilydepreciated even when ourreserves exceeded $60b.Incidentally, weaker Nairarates will, irrespective of crudeoil price level, also instigatehigher fuel prices domesticallyand make the abolition of fuelsubsidy very unpopular. Onthe other hand, stronger Nairarates will reduce fuel pricesdomestically, and ultimatelyeliminate subsidies, to make theimposition of a sales tax on fuelpossible; furthermore, astronger Naira will also makefuel smuggling unprofitableand unattractive and ensureuncontested deregulation ofthe downstream sector by civilsocieties.

Clearly, the excruciatingburden of ever surplus Naira,also feeds the pool thatfacilitates corruption and is alsoresponsible for abnormallyhigh inflation and interest ratesand is equally responsible forunyielding Naira depreciation.A disciplined investigation willsurely reveal that systemicsurplus Naira is primarilycaused by CBN’s creation offresh Naira values for monthlydistributable dollar revenue.

SAVE THE NAIRA, SAVENIGERIA!!

A delegation from theNigerian German Business

Association (NGBA) and AHKNigeria have embarked on aninteractive and fact findingmission to Delta State to exploreopportunities for business bymember-companies in the state.

The trip which was promptedby the invitation of theEconomic Adviser to the stategovernor, Mr. Afam Obiago,resulted in a meeting in Asaba,the state capital, with

NGBA, AHK Nigeria explore opportunities forGerman businesses in Delta

By PRINCEWILLEKWUJURU

representatives of Chambers ofCommerce from four cities in thestate including Asaba, Ethiope,Sapele and Warri.

The delegation comprising ofthe Delegate of the GermanDelegation of Industry andCommerce in Nigeria (AHK),Mr. Andre Roenneand theNigerian German BusinessAssociation (NGBA) ChiefOperating Officer, Mrs. JenniferAnoyika, also paid courtesy visitto the state’s Commissioner forCommerce and Industry, Dr.Chris Ekiyor.

According to Mrs. Anoyika,

the delegation was well receivedand opportunities for Germancompanies in all sectorsincluding energy, constructionand technology were discussed.During the visit, Dr.Ekiyorexpressed keen desire for theparticipation of Germaninvestors in various initiativesin the state, particularly theExport Free Zone underconstruction. The delegationalso visited the Delta State One-Stop-Shop Initiative (DSOSSI)which is positioned as adestination for investors lookingto do business in Delta State.

Buhari would needto also reduce theduplication offunctions byvarious MDAS asper therecommendationsin the Oronsanyereport

economy: stakeholders list options for buhari

Documents