CMYK

NOVEMBER 5, 2012

Continues on page 18

By PETER EGWUATU

To successfully implement acomplete dematerialisation inthe nation’s capital market,

shareholders around the country haveurged the Securities and ExchangeCommission (SEC) and Central Bankof Nigeria (CBN) to investigate theactivities of quoted banks andregistrars over non-compliance withe-dividend payment directive.

Dematerialisation is the process ofconverting physical share certificatesinto electronic form i.e. crediting ofequivalent number of shares to adepository account electronically.

Probe activities of banks, registrars,shareholders urge SEC, CBN… Demands amendment of CAMA

The shareholders equally averredthat for full dematerialisation to beeffectively implemented, there isurgent need to amend the Companiesand Allied Matters Act (CAMA) 1990.

According to a section of CAMA,“However, should an allottee insist onbeing issued a share certificate,despite its disadvantages, a certificateshall be issued, in accordance withsections 146 and 147 (1) of theCompanies and Allied Matters Act(CAMA).”

The Chairman of ProactiveShareholders Association of Nigeria(PROSAN), Mr. Oderinde Taiwo, whospoke the minds of his members to

Vanguard, said; “It is really appallingthat after several directives from theregulatory bodies in the financialsystem asking banks to acceptdividend warrants into savingsaccount, they are yet to comply. Howwill the SEC be able to achieve thedematerialisation policy in theNigerian capital market when banksare frustrating shareholders?”

Continuing he said, “I think whatSEC and CBN should do is to jointlyinvestigate the activities of thesebanks and the registrars and why theyare refusing to accept dividendwarrants into savings account. Theregistrars on their part ,do not pay the

money due as dividend to theshareholders when accounts detailsare sent to them. When you go to thebank, they will say, 'we have not seenany cheque sent to us. How do youwant us to credit the shareholders?'Shareholders use savings accountbecause if they pay the dividendwarrants into current account, thebanks will charge them Commissionon Turnover (COT). So this is part ofthe reasons why unclaimed dividendis growing. Most of the dividends paidto shareholders in recent time are veryminimal and most shareholders wouldwant to avert the COT, hence they willprefer using savings account toreceive their dividend.”

The PROSAN chairman, further said,

*From right; GMD/CEO, UBA Plc, Mr. Phillips Oduoza; Managing Director, Poly Products Nigeria Plc, NariGwalani; Executive Director, UBA Plc, Mr. Rasheed Olaoluwa, during the bank’s Customers Forum held in Lagos.

Cover Story

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18 — Vanguard, MONDAY, NOVEMBER 5, 2012

Continued from page 17

“In the last one decade,information technology hasbeen adding value to allareas of human endeavours -social, economic, political,science, sports, journalism,among others. The Nigeriancapital market through theapex regulatory authority -SEC, launched someelectronically informationtechnology-driven initiativessuch as e-Bonus, e-dividend,e-Rights among others in2007 to replace the manualand slow implementation ofthese services in order tomove our market forward andto compete with other capitalmarkets in the world.

“But to the surprise of allother stakeholders, some ofthe registrars are yet to carryout these highly publicisedservices to the benefit of ourmarket. This, we haveobserved as an organisedbody of shareholders thatsome of the registrars of ourcompanies do not havemodern facilities to carry outthese technology-drivenservices. We hereby call onSEC to set up an investigativepanel to look into this issueand act accordingly for thesake of our market, especiallynow that they are trying torebuild investors’ confidencein the market.”

To this end, Taiwosuggested that any operatorfound wanting in the courseof investigation by both SECand CBN should besuspended and finedaccordingly.

Meanwhile, the Director-General of SEC, ArunmaOteh, said in an interviewwith newsmen that the

commission has commencedthe revamping of its investoroutreach, publicenlightenment and investoreducation programmes. Shesaid; "We have a committee ondematerialisation and we arewaiting for them to tender tous their plans overenlightening investors on theimportance ofdematerialisation and when itwould be appropriate tocommence fulld e m a t e r i a l i s a t i o n .Furthermore, we are going tolisten to retail investorsconcerning some of the issuesthey have with the market.Some of what we have heardas we look at the profile of thecomplaints relate to issuesaround not having their sharecertificates delivered to them,dividend and un-returnedmoney related to allotment.

“So, what we are going todo in organising this townhall meeting is to haveregistrars, representatives ofother trade groups participatein those discussions so thatdirectly, they can answersome of the questions thatinvestors have. We are alsogoing to make sure thatshareholders understandtheir rights because what wehave observed is that there isnot much understanding ofthe rights of a shareholder. Weare going to, in the future,have what I call a plainEnglish programme as part ofa way to enhanceunderstanding, which isbasically to make sure thatour rules are produced inlanguage and material thatare easy to understand by alay man.”

Emphasising that, “a well-informed investor is a well-protected investor,” the SEC

DG said ongoing radio andtelevision programmes wouldalso be expanded. “We haveoffices in Abuja, Lagos, Kano,Kaduna, Port Harcourt,Maiduguri, Onitsha andIbadan. We hope that thoseoffices can help to try andmake sure that we are easilyavailable to the averageinvestor in the differentregions in the country,” Otehadded.

It would be recalled that theSEC had initially set upJanuary 2013 as deadline forfull dematerialisation in thecapital market. Oteh haddisclosed that SEC maypostpone the deadline for theshare certificatedematerialisation earlier fixedfor 1st January, 2013 ifnecessary.

She said the idea ofpostponing the deadline wasas a result of the inability ofthe committee ondematerialisation to organisean enlightenment programmein all the geo-political zonesof the country to enlighteninvestors on the need andbenefits of dematerializingshare certificates. Thecommittee is expected toadvise the Commission onwhat to do to implement fulldematerialisation after theexercise.

While commenting on theissue of dematerialisation, theChairman of ProgressiveShareholders Association ofNigeria (PSAN), Mr. BonifaceOkezie, blamed the regulatorsfor failure to implement the e-dividend policy four yearsafter it was launched.

According to him, “SECfailed to put up the requiredmassive enlightenment

Continues on page 19

Probe activities of banks, registrars,shareholders urge SEC, CBN

*2013 Budget Town Hall Meeting held at June 12 Cultural Centre, Kuto, Abeokuta last ThursdayFrom right; Mrs. Kemi Adeosun, Finance Commissioner, Mrs Wande Muoyo, Budget andPlanning Commissioner, Gov. Ibikunle Amosun and Hon. Suraj Adekunbi, Speaker, OGHA atthe event. Pix by Wunmi Akinola.

Vocation and Technical Education– A key to improving Nigeria’sdevelopment. Part 2

,

,

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 creating it.As Peter Drucker hasobserved “If you want topredict the future, create it.”

In Nigeria, the growingproblem of unemployment inthe country has contributedlargely to the worsening

problem of poverty among thepopulace. Unemploymentaccording to Olaitan (1996)leads to frustration anddisillusionment which mayresult in crime or drug abusein a futile attempt to escapefrom and forget the pains andhumiliation of poverty andlack. The problem ofunemployment, he furtherstated, has worsened asmillions of school leavers andgraduates of tertiaryinstitutions have not securedgainful employment over theyears. Unemployment hasposed a serious problem, notonly to the welfare ofindividuals but also to that oftheir families. Many ablebodied and highly qualifiedpersons who could not securegainful employment haveremained economicallydependent on their parents.This is because they lack thenecessary occupational skillsto be self employed and toeffectively function in today’sworld of work. Theseoccupational skills can be

provided by technical andvocational education.According to Abdulahi(1994), technical education isthat aspect of education thatinvolves the acquisition oftechniques and application ofthe knowledge of the sciencefor the improvement of man’ssurrounding.

Technical and vocationaleducation prepares one forthe world of work with whichthe individual become reliantand can make contributionsto the development of thesociety. As employers look fornew talents every year fromnew graduates, it is importantto not only have a solideducation, but graduates thathave features that stand outfrom the rest of thegraduating students. Withthe economy being moreglobalised than ever, it isimportant to have abackground and a skill setthat allows graduates tobecome immersed in theglobal economy right fromgraduation (Cote, 2007). It isimportant for these studentsor graduates to have skills ininnovation in technologyeducation andentrepreneurship to be readyto fit into the global marketplace on which today ’seconomy depends on.Entrepreneurial skillsneeded by Technical andVocational Education:

Leadership is not a majorcause of Nigeria’s under-developed status. Nigeriacan become an economicpower-house (and realise itsvisions) only if properattention is given toeducation and technologicaldevelopment, promote andreward creativity, andchannel its material andhuman resources toproductive use. The leadersmust recognise the relevanceof technical and vocationaleducation in nationaldevelopment and adopt andadapt what works indeveloped nations. Theresources being wasted in theon-going false re-brandingcampaign should have beenused to re-brand the nation’seducation sector. No amountof rhetoric (or fanciful slogan)would solve Nigeria’s socio-political and economicproblems. The leaders couldsalvage Nigeria’s image byre-branding their mentalityand doing the right thing:tackle corruption, reform theelectoral system and fix thedilapidated institutions.

As employerslook for newtalents everyyear from newgraduates, it isimportant tonot only havea solideducation butgraduates thathave featuresthat stand outfrom the rest ofthe graduatingstudents

CMYK

Vanguard, MONDAY, NOVEMBER 5, 2012 — 19

Cover Story

,

,

campaigns on the policy.Electronic dividend paymentis the process of creditingshareholders’ accountswithin 24 hours after acompany pays dividends. Itwas launched by SEC inFebruary 2008. It is a goodpolicy because it will helpwipe away some of the mal-practice we have witnessedusing manual system.”

He said that e-dividend, ifimplemented, will alsoreduce the incidence ofunclaimed dividends to thebarest minimum. In hiswords; “SEC also failed tomeet company registrars,service providers and bankson problems beingencountered in remittingdividends. Manyshareholders are notinterested in the e-dividend

policy due to some banks’insistence on currentaccounts for e-dividendpayment. So I advised SECto liaise with the CBN toensure that all banks, bothquoted and unquoted,accept both savings andcurrent accounts for e-dividend payment.”

Alhaji GbadeboOlatokunbo, President,Nigeria ShareholdersSolidarity Association(NSSA), in his own viewsaid; “The country ’s poorpostal system contributed tothe problem of unclaimeddividend.”

Continuing, he said,“However, the CAMA 1990is long overdue foramendment. There is nohow we can implement fulldematerialisation in thecapital market because theCAMA still gives investors

power to have physical sharecertificate. The uncooperativeattitude of some banks onpayment of dividends intosavings accounts made someinvestors to shun the policy.We are doing our best ineducating investors on thebenefits of the policy. Theproblem at the moment is thatinvestors with small dividendsare being discouraged from

subscribing to the policy dueto insistence of banks onpayment into currentaccounts.”

Meanwhile, efforts tospeak to some of the banksfailed as most of the spokes-persons refused to comment.However, one of the banks'spokespersons who preferredto remain anonymous said;

“Why the banks are notaccepting dividend intosavings account is that duringclearing, the banks pay COT.So if the regulators want thebanks to accept dividendwarrants into savings accountthen issue of COT should beeliminated during clearingand there should be adirective from our regulator,CBN.”

Continued from page 18

Probe activities of banks, registrars, shareholders urge SEC, CBN

It is a known fact thatcities across the worldare confronted with

diverse and complex problemswhich have socio-economicand physical implications forcity dwellers. These problemsas experienced by cities ofless developed countries, areenormous andmultidimensional in nature.

One obvious manifestation ofthese problems, especially inNigeria, is begging, that is theact of asking people for money,food, clothes. The problem ofbegging is a social menacewhich has a negativeimplication not only foreconomies of the cities, socio-physical environment but alsofor beggars themselves. Theincreasing population ofbeggars in Nigerian citiesconstitutes an eyesore orenvironmental nuisance andhealth hazards, particularlythose carrying infectious andcontagious diseases. Begginghas serious implication for thecity and national economy asbeggars are not economicallyproductive in any way sincethey contribute nothing to theeconomy. It leads not only tosocial relegation of the city butalso to that of beggars as wellas stigmatization. Beggarsconstitute a social threat to theNigerian society especially inthe cities. They portray a badimage to outsiders orstrangers. Some criminals hidunder the guise of beggars toperpetuate their evil deeds.

They are at times used asinstruments by mischiefmakers, who use them tovandalize public propertiesand utilities built with nation’sresources. The nefarious

Begging fast becoming away of life in Nigeria

activities of those fakebeggars such as criminals,area boys” and thugsconstitute one of the sourcesof civil unrest to the citydwellers. Begging alsoconstitutes economic threat tothe society as beggars are noteconomically productive inany way since they contributenothing to national economy.The city and nationaleconomy is retarded asconsiderable proportion ofbeggar’s population. Anotherset of beggars are theperpetually sick ones; theseones always suffer fromdiseases, like cancerousgrowths on visible parts oftheir bodies, which they wearlike a badge of honour.

There’s an old man whobegs for money because hehad elephantiasis. He is seenaround quite a lot and manyare feeling if he has gone toa hospital to have his swollenleg seen to. He drags itaround like luggage and thesheer size of it intimidatespeople into giving himmoney. At most strategicroads, many with some formof diseases are carried andput at the center of the roadwith men and women withbows in their hands solicitingfor help. They are controlledby godfathers who areentitled to a ‘cut’ of theirmoney in return for‘protection’. The godfathersare also responsible forcostuming i.e. fake woundson appropriate parts of yourbody; for the lame,wheelchairs, wheelbarrowsor skateboards; for the blind,a child to lead you aroundand collect the day ’s

earnings; and for youngwomen, malnourished looking.

Most worrisome is the factthat Public service in Nigeriais being debased on daily basis.Today each office you go intoeither at the federal, state orlocal government level, thereare Nigerians who indulge inone form of begging and theother. It is fast becoming anembarrassment across thecountry when on approaching

a supposed security officer, hepolitely ask what have for theboys, or your boys are here.It is either they are poorlypaid or they are not satisfiedwith what they are doing.

At the nation’s gate way,either at the airport or seaports many of the immigrationofficers hold onto traveler’spassport asking for a giftbefore checking them out orin which ever is applicable.A situation like this can notbring the best out of thesemen on uniform or insensitive position in thecountry. Every office you enterin the country today, someonesomewhere will expect you toperform before you leave andif you fail to, they will boldlyask, ‘Ogah what do you havefor the boys?’ At the airport,Murtala MohammedInternational Airport inparticular, both Nigerians andforeigners complain of theunethical behaviour of mostmen of Immigration, Policeand other agencies at the frontdesk. They do not care aboutthe image of the country notto talk of their own. Usually,

caution is thrown to the wind.Sadly enough, those inauthority do not care nor takenotice of this development. Atmost road junctions across thecountry where you havepolicemen as well as otheragencies on duty, some aremore interested in begging.

‘Corporate Beggars’ areactually more of pickpocketsand conmen than beggars.The most unfortunate of thiscategory of beggars are thosewho pose as ministers of theGospel to beg. They tell youtales of how they are going fora church programme but haveno money to go. Onenotorious one in Festac/Satellite goes around with hiswife and baby beggingmotorists for money, flashingfake pastoral identity card.While an average personthinks in terms of dignity andthe joy that comes fromcreating something which hasthe potential to changesomeone else’s life,professional beggars think interms of Naira and Kobo. Canthe Nigerian nation continuelike this?

‘CorporateBeggars’ areactually moreof pickpocketsand conmenthan beggars;the mostunfortunate ofthis category ofbeggars arethose who poseas ministers ofthe Gospel tobeg

The Catfish FarmersAssoc ia t ion o f

Niger ia (CAFAN) hasappealed to the FederalGovernment to protectlocal fish farmers againstdumping of foreign fishesin Nigerian market. ChiefTayo Akingbolagun, thepres ident o f the

Farmers seek FG’s protection against fish importation

assoc ia t ion , made thea p p e a l d u r i n g t h eopening of the Oyo StateCAFAN 2012 Catfish Fairin Ibadan. He said that thepro tec t ion becamenecessary to enable thefarmers attain the target ofone million tonnes of fishproduction in the next five

years. According to him,the target is set under theFedera l Government ’ sAqua-culture Value ChainDevelopment programme.Akingbolagun said thatdumping of foreign fish inNigeria was one of thegreatest challenges facingthe local fishing industry.

CMYK

20 — Vanguard, MONDAY, NOVEMBER 5, 2012

Business & Economy

BRIEF

BY MICHAEL EBOH

Aston Business Schoolhas entered into astrategic partnership

with These Young Minds tohelp sensitise businessleaders in both the privateand public sectors in Africaon the rapidly changingglobal business context, aswell as to imbue them withthe skills needed toeffectively manage theirvarious organisations intough economicenvironment.

In a statement, weekend,Alim Abubakre, FoundingExecutive Director, TheseYoung Minds, said it is awarethat there was an urgentrequirement for effectivestrategic leadershipdevelopment programmestargeted at senior leaders inemerging countries, hencethe decision to sensitise thebusiness leaders on effectivemanagement skills.

To this end, he said boththe Aston Business Schooland These Young Minds areorganising a programme forsenior leaders in emergingcountries scheduled to holdat Aston in Birmingham,United Kingdom, fromNovember 26 to 29, 2012.

He said, “The programmecurriculum is tailoredspecifically to address thechallenges that AfricanDirectors face.Theprogramme explores issuessuch as poor infrastructure(e.g. inadequate electricitysupply, limitedtransportation network etc.),China’s influence on Africaand the implications of theWestern legacy on businessin an African context.“Competition in Africa will

Aston, These Young Minds partner tosensitise African business leaders

also be examined, taking intoaccount foreign companiesoperating in Africa andexternal market opportunities.Case studies are used toillustrate many of theseissues.” Abubakre also statedthat participants will have anexclusive working visit to aglobal organisation situated inBirmingham, and theopportunity to attend anetworking session. Uponcompleting the course, he saidparticipants will receive acertificate from Aston BusinessSchool which hasinternational recognition fordelivering value addingexecutive educationprogrammes.

Also commenting, PaulButler, Executive Director atAston Business School, said

“Having received verypositive feedback from thefirst group of participants onthe initial programme, a mixof senior leaders from boththe private and public sectors,I have no doubt that theprogramme is directlyaddressing the future needsof leaders in the Africancontinent. Having spent a lotof time with the groupoutside of the classroom, I amincredibly impressed with thelevel and quality of thedelegates and this confirmedthat Africa already has leadersof the highest calibre.

“It has been a pleasure forme personally to learn fromthe group about Nigeria aswell as Africa and its contextand I believe that theProfessors at Aston who

delivered the programmewere challenged throughoutthe programme to work at thehighest level of theirintellectual prowess to satisfythe zest for best practice instrategic leadership andchange thus, forcing us atAston Business School to riseto the challenge.”

Butler said Aston BusinessSchool looks forward tofurther iterations of theprogramme and believes thatthere may be otheropportunities for AstonBusiness School to partneragain with These YoungMinds to develop bespokeprogrammes that meet theneeds of Africa’s most seniorleaders to enable them todeliver a great future forNigeria and Africa as a whole.

*From left; Mr. Segun Aina, President and Chairman of Council, Chartered Institute of Bankersof Nigeria, CIBN, Mr. Peter Obaseki FCIB, Group Managing Director, FinBank Plc, and Otunba(Mrs.) Adebola Osibogun, FCIB, at the 2012 Fellowship investiture by the CIBN held in Lagosover the weekend.

A uniform logo that willenable Nigerians toeasily identify

registered microfinancebanks, MfBs, will soon beintroduced, an official of thebank’s association, has said.

Mr. Eniola Agbesoyin,Treasurer of Lagos StateChapter of NationalAssociation of MicrofinanceBanks, said that the objectivewas to assist members of thepublic to easily detectunregistered microfinancebanks.

He said that activities ofquacks were affecting

Association plans uniform logo for microfinance banks

operators in the sub-sector.Agbesoyin, who is also theChief Executive of OliveMicrofinance Bank, said thatthere were some institutionswhich claimed to beregistered, but wererendering services outside therules. According to him, someof them are giving loans atlow interest rates to lurecustomers into their banks. “Iwant the public to beware thatall that glitters is not gold.There are institutions thatclaim to be microfinance banksoffering outrageous interest

rates and packages that arenot normal.

“Somebody asking you forN100,000 deposit andyou going away with onemillion naira; bringingN200,000 to get five millionnaira in two weeks. I think thepubic should know that theseare quacks. The Central Bankof Nigeria has often advisedus to report those that are notregistered so that it can dealwith them. In view of this, theassociation has decided toproduce a uniform logo for itsregistered members. When

you visit any microfinancebank and you do not see anyevidence, you don’t need todo business there,” he said.

Agbesoyin commended theCBN for publishing the list ofthe registered microfinancebanks in the country on theinternet. He also applaudedthe National DepositInsurance Corporation forproviding stickers to allregistered institutions.According to him, the stickeris enough to identify aregistered microfinance bank.

CHARTERED Institute of

Personnel Managementof Nigeria (CIPM) last weekinducted 386 new associatemembers into the profession-al body, with 92 of them ad-mitted through the Practition-ers’ route while the remain-ing 294 came in via Profes-sional examination.

President/Chairman ofcouncil of CIPM, Mr. AbiolaPopoola, who presided overthe 13th induction ceremonyof the Institute told the newmembers that it is their re-sponsibilty to ensure best HRpractices in which ever sectorof the national economy theyoperate.

“Our charter status conferson us the responsibility toregulate the practice of Hu-man Resource Managementin Nigeria; also we are man-dated to promote excellencein the acquisition and appli-cation of knowledge and skillsin this specialist field so thatwe may contribute more effec-tively towards acceleratednational development.

“This responsibility ofemplacing best practice in HRmanagement falls on us as anInstitute at the corporate lev-el; it also falls on you as anindividual member in your lit-tle corner of the national econ-omy, be it the private or thepublic sector. We thereforeexpect that you, in your indi-vidual capacities, commit tocontinuous self-developmentthrough study, experiencesharing and thoughtful appli-cation of best practices in yourareas of work.

“We also expect that beingmembers of this professionalbody, you shall demonstratebest practice in the develop-ment and effective deploy-ment of the human capitalentrusted to your care towardsthe achievement of the corpo-rate goals of your organisation,thus commanding the respectwe so much desire as profes-sionals in this field, he stated.

Popoola further emphasisedthe need for the inductees toabide by the ethics and pro-fessional code of the Institute.“This being an induction cer-emony of a Professional Insti-tute, we cannot but dwell onthe issue of ethics and its cen-tral importance to profession-alism. Our code of conduct inthe Institute provides practi-tioners with an ethical ‘com-pass’ to help navigate thechallenging social and eco-nomic environment of work."

CIPM inducts386 newassociates

CMYK

Vanguard, MONDAY, NOVEMBER 5, 2012 — 21

BRIEFS

Business & Economy

BY NKIRUKA NNOROM

The Ogun State branchof the ManufacturersAssociation of Nigeria,

MAN, has commended theExecutive Governor of thestate, Senator IbikunleAmosun, over his effort atrepositioning the state’seconomy, especially the 40 percent rebate on land acquisitiongranted investors.

They, however, called on thestate government to step downon the multiplicity of leviesimposed on them by itsagencies.

The association’s Chairman,Dr. Dapo Ogutuga, who spokeat the 27th Annual GeneralMeeting, AGM, at Sango-Ota,Ogun State, said thegovernor ’s efforts atrehabilitating the entire roadnetwork deservescommendation.

He said the association wasalso aware that “ youradministration is committed topromoting private investment,determined to develop andsustain investors’ confidenceas well as implement theprogrammes which thecommunity of investors wouldbenefit from.”

Notwithstanding, he saidthat his members facemountainous problems in theirday-to-day businesses,ranging from multiplicity oftaxes, levies and other chargesthat are imposed on them byvarious tiers of government inthe state, especially LocalGovernment Councils,Ministries, Departments andAgencies.

“The continuousintroduction of taxes and

Manufacturers commend Ogun StateGovt over 40% land acquisition rebate… decry multiplicity of levies

levies by these organs ofgovernment and the mannerin which they go about theircollection is, to say the least,unorthodox and if anythingbut civil.

“Their actions pose greatchallenges to businessplanning and execution ofbusiness projection. Forinstance, the stategovernment recently revisedDeed of Lease Agreementfrom 10 to five years while atthe same time revising theland charge from N62, 000 toN242, 000 per annum.

“We are appealing to your

Excellency to kindly look intothese and other issues thatare affecting themanufacturing sector so thatfactories operating in the statecan function optimally andthereby perform its role ofwealth creation, job creation,social and economicdevelopment,” he said.

He listed other challengesbeing faced by manufacturersin the state to include: verypoor infrastructure, especiallywater supply and electricity inindustrial estates, stoppageand molestation of vehiclesconveying raw materials and

finished products on the roadin respect of various levies,most of which unauthorised aswell as over-lapping offunctions by various organs ofgovernment that visit factoriesat different times demandingsimilar things.

Pledging the support of hisassociation to the state’sattempt of making theenvironment more investors’friendly, Ogutuga said thestate has continually recordedincreased presence ofmanufacturers, despite thedaunting challenges.

BY EBUN SESSOU

The era of Ministries,Departments andAgencies (MDAs) in

Lagos State spendingbudgetary allocations withoutproper monitoring may havegone for good as measures arebeing put in place to verify allthe claims of governmentparastatals in the state.

Justifying the on-goingconsideration exercise of theyear 2011 Auditor-General’sReport, the Chairman of thePublic Accounts Committee(PAC) in the Lagos StateHouse of Assembly, Mr. BolajiYusuf Ayinla, said that it ismeant to ensure that all MDAscan defend all their

We want to ensure tax payers’ money is wellspent — Lawmaker

expenditures.According to him, “the

exercise is a regular one, afterthe Auditor-General’s officemust have done their work onthe MDAs, they send theAuditor-General’s report tomembers of the Lagos StateHouse of Assembly, who willthen do their oversightfunction on the report, evenfor those indicted and thosewho were not indicted.

”What we look at is to makesure tax payers’ money isspent the way it should bespent, most especially theones that affect the budget.Have they actually spent itjudiciously on what it is beingbudgeted for, we want toknow,” he added.

Ayinla noted that he startedwith the 2010 Auditor-General’s report and that itwas discovered that someministries did not do whatthey ought to do, mostespecially in terms of storage,where they have to recordwhatever purchase theymade.

He explained that hiscommittee implements theresolution of the House,adding that it is thecommittee’s duty to let theMDAs know that somebody iswatching them to ensure thatthey are being careful withwhat they do.

“Accountability would beensured because you knowthat whatever you do,

somebody is watching overyou on how you spend the taxpayers’ money everyday. Wegave the ministries time to docorrections on what they havedone on the resolution of theHouse after the Auditor-General’s reports of 2011; wewill get reports from theministries.

"We will send our reports tothe Lagos State House ofAssembly, and the resolutionsof the House must be carriedout, and there is punishmentfor non-compliance,” he said.

He emphasized that thepunishment for defaulterswould be determined by themembers of the House ofAssembly and the Speaker.

14 fuel-ladenships wait todischarge atLagos ports

The Nigerian PortsAuthority (NPA) says 14

ships are waiting to dischargepetroleum products at thevarious oil terminals in Lagosports. NPA disclosed this inits daily publication, ShippingPosition, made available tonewsmen in Lagos.

The document indicatedthat 11 of the 14 ships woulddischarge petrol; two woulddischarge base oil, while aship would discharge aviationfuel. It also reported that 100ships carrying differentcargoes would sail into theports between November 1and 30.

The document said that 21of the expected ships wouldarrive with petroleumproducts. The News Agencyof Nigeria (NAN) reports thatthe remaining 79 ships wouldarrive with new and usedvehicles, rice, fish, containers,bulk sugar, steel products,general cargoes, bulk wheat,and bulk gypsum.

Stakeholderscall for moreaccess tosustainableenergy

Tourism stakeholdershave called for

increased access tosustainable energy to boostgrowth in the sector, the UNWorld Tourism Organisationsaid in a report. The reportstated that the agendaneeded the support of theenergy sector andgovernments to moveforward, adding that energywas one of the most pressingchallenges facing tourism inthe world today. “We cannotguarantee the future ofimportant sectors such astourism, if we don’t protect theenvironment in which theytake place,” the report stated.It said that tourism was oneof the world’s largestemployers of labour hence theneed to ensure its sustainablegrowth. According to thereport, there are manysustainable energy initiativesalready in place in thetourism sector. It said theinitiatives ranged from theworld’s airline giants usingbio-fuels in commercialflights, to small hotels placinginsulating plants on theirroofs to keep hotels cool insummer and warm in winter.

*From left; Chike Ibekwe, CEO, Reel Big Deal Ltd, Busola Elegbede, CEO, Whirlwindrush,Akin Fadeyi, CEO, Bufferzone Ltd & Executive Producer, Bridges, Muyiwa Ojo, Scheduler,Mnet West Africa at the script presentation of the National Health Insurance Scheme’s DramaAdvocacy Project held in Bufferzone Studios in Lagos.

22 — Vanguard, MONDAY, NOVEMBER 5, 2012

CMYK

Banking & Finance

BRIEF

,

,

BY BABAJIDEKOMOLAFE

In line with its current media campaign

theme, bringing dreamsalive, Union Bank of NigeriaPlc will be at the 2012 editionof the Lagos InternationalTrade Fair to showcase itselectronic Product platformsand demonstrate its rebrand-ed service delivery to the de-light of customers, especiallyyoung entrepreneurs whosedreams it has vowed to trans-form into reality in the run-ning campaign.

The integrated campaign isintended to re-invigorate thebrand , change public percep-tion about the bank and itsservices and offer proofs thatit has for a century, assistedand made dreams comethrough for innumerable cus-tomers, even as it just be-g u n . Indeed, the bank is paradingan impressive array of e-prod-ucts using POS terminals, in-ternal transfers -account to ac-count; Card transactions forbills payments and Unionmobile for commerce as wellas ATM services. Others arecorporate pay, internet bank-ing, Pay direct, Pay4me andpay outlets for cashless trans-actions.

Union galaxy is an e-pay-ment platform that has both e-payroll e-payment and collec-tion platforms that big, smallcompanies and governmentministries, departments andagencies can deploy to seam-lessly manage their payments.The distribution and serviceindustry can also use it forbills collection nationwide.With over 60 companies andmultinationals already onboard, the bank is urging oth-er companies to take advan-tage of Union Galaxy, rated asone of the best platforms in thefinancial services industry.

In addition, the bank wouldalso display value creatingproducts and services for itsnumerous existing and pro-spective customers, namely;Union-ever, savings/currentaccount based products,Union lifetime account, andUnion wealth consumer cred-it finance loan products. Also, small, medium andlarge scale farmers, agro- al-lied companies who desiresoft loans to purchase storageitems for the season wouldtake advantage of seamlessprocess of documentationsthat would lead to loan dis-bursement. This is in additionto advisory services on im-ports, oil and gas, sold min-erals as well as well as for-eign exchange transactions.

CeBIH: Strategic agenda for efficiente-payment

Nigeria needs a stra-tegic agenda toconsolidate recent

gains and fast-track the coun-try’s move towards an effi-cient electronic payment sys-tem.

This was the submission ofexperts who spoke at the 2ndannual conference of theCommittee of e-Banking In-dustry Heads (CeBIH) heldlast week in Calabar, CrossRivers State. This strategic agenda, theysaid must incorporate: A pro-gramme of incentives forelectronic payment usage; Abalancing of cooperation withcompetition, Massive educa-tion and enlightenment; Ex-pansion of service offeringson electronic payment chan-nels especially Point of Sale(PoS) terminals; A businessapproach to electronic pay-ment; and full adoption ofelectronic payment by thegovernment.

Experts who spoke at thetwo day conference are:Daniel Monehin, DivisionPresident, Sub-Sahara Africa,Mastercard Worldwide; Mr.Emmanuel Obaigbona, Dep-uty Director, Banking andPayment System, CentralBank of Nigeria (CBN); AndMr. Ade Shonubi, ManagingDirector, Nigeria InterbankSettlement System (NIBSS).Others are Pedro Hipolito,General Manager, SIBS In-ternational, Libson, Portugal; Martin Holloway, VP, SalesAfrica & Middle East NEM-EA, VeriFone U.K; AgadaApochi, Managing Director,Unified Payments SystemLimited; Amit Wohl, EMEAChannel Manager, Trusteer,USA; Sam Kolajo, EnterpriseLogistics; Victor Ajua, Coun-try Manager, DataGroup IT.The focus of discussion at theCeBIH conference was “De-veloping a market structurethat works: Challenges andProspects for the NigerianPayment System”.

Obaigbona and Shonubi intheir presentations noted thatwhile there are still a lot ofchallenges in the quest tomove the country from cashto electronic payment, therehave been significantachievements especially inthe deployment of electronicpayment channels likeATMs, Internet, PoS and elec-tronic money transfer. Theyobserved that the improve-ment made was the product

of collaboration among stake-holders, and to consolidateon this requires collabora-tion.

According to Shonubi, “De-veloping a Nigeria paymentssystem that works, requires: Un-biased regulation and oversightover the financial system prac-titioners by the regulatory au-thorities; Collaboration betweenmajor stakeholders in the e-pay-ment value chain”.“CeBIH needs to get more in-volved and should set industrytargets with NIBSS which theyboth should work towards on arecurrent basis”, he added.

Obaigbona also made a casefor collaboration saying, “Thecashless policy was primarilyaimed at enthroning electronicpayment. “And we are makingprogress but we need ideasfrom this group. We suppose tocome together because CBNencourages collaboration. Weneed to hear from you. You arethe experts on electronic pay-ment. It is from your own per-spectives that a lot of things

happen. You tell us your ownviews, we look at them, and weinvite you to discuss, and wewould be able to come up withsomething for the industry.”In his welcome remarks, Chu-ma Ezirim, CeBIH Chairman,said that while collaboration isneeded to set standards andbuild infrastructure to reducecost for the industry, there ishowever need to balance coop-eration with competition. Hesaid, “Centrally-agreed commonfeatures can sometimes hamperproduct and/or service differen-tiation and innovation at the in-dividual service provider level.A key question is what factorsthe authorities and key stake-holders should consider in bal-ancing cooperation and compe-tition in retail payment systems”.

He noted that while it is theresponsibilities of Central Banksto provide oversight and regu-latory functions to deal withconflicts of interest and bal-ance cooperation and compe-tition in order to achieve opti-mal availability and affordabil-

ity of payment instruments,the CBN however should notunduly interfere in the provi-sion of electronic paymentaccess services in the country,which is an area that givesbanks the opportunity to com-pete for product/service differ-entiation and innovation.”

Daniel Monehin of Master-card and Martin Holloway intheir presentations made sug-gestions on how to facilitateacceptance of electronic pay-ment channels especially PoS.

While Monehin called for aprogramme of incentives thatwill compel cardholders andmerchants to accept PoS, Hol-loway on his part, said thatbanks need to be brave andchange their approach to de-ployment of PoS to mer-chants.

“In my experience in marketslike South Korea, what wasused there was a dual ap-proach. What I see mostly inNigeria is a single approach”,Monehin observed.

“In Nigeria, we see the stick,we see the penalties, we seethe charges, but we don’t seethe carrots, like telling people,if you embrace electronic pay-ment, here is the pat you willget on your back. The pictureof merchants that keep PoS under the table will be veryuncommon if you have pro-grammes in place that moti-vates that merchant to recorda sizable portion of his reve-nue on that terminal.

*From left; Mr. Chuks Iku, Pulicity Secretary, Committee of e-Banking Industry Heads (Ce-BIH); Adelola Agbebiyi, Business Development Manager, Meditrranean Cards Comapny, Ni-geria and Hany Fekry, EMP Commercial Director, during the 2012 Annual Conference/Retreatof CeBIH in Calabar, Cross River State. PHOTO; Nwankpa Chijoke.

Union Bankshowcases e-products, cam-paign at Lagosfair

Developing a Nigerian pay-ments system that works re-quires unbiased regulation andoversight of the financial systempractitioners by the regulatoryauthorities

Vanguard, MONDAY, NOVEMBER 5, 2012 — 23

CMYK

F P

24 — Vanguard, MONDAY, NOVEMBER 5, 2012

CMYK

Corporate Finance

BRIEF

BY PETER EGWUATU

Operator condemns DMO over call for govtstockbrokers

BY NKIRUKA NNOROM

The Debt ManagementOffice, DMO, has been

taken to task over its recentpublic notice requesting forgovernment stockbrokers thatwould deal specifically ongovernment bonds on itsbehalf.

This criticism was made bya senior stockbroker, MaziOkechukwu Unegbu, who isalso the Managing Director ofMaxifund Securities Limited.

He said that the move wasparticularly wrong especiallynow that the capital marketwas working towardscultivating retail investors,who are still engulfed byapathy.

He signified that the movewould further crowd out retailinvestors that have sinceexited the capital market dueto lack of confidence.

Unegbu remarked that theN20 billion turnover expectedto have been achieved byinterested companies over thelast three years was

outrageous, saying that thosethat could meet suchrequirement are those thatdeal mostly with institutionaland portfolio investors.

He said, “One of theconditions was that you musthave made N20 billionturnover between 2008, 2009and 2010; That was verywrong and they are talking ofretail investors coming in.“The only people that willmeet that condition are bigstockbroking firms such asIBTC Asset Management,banks’ owned stockbrokingfirms and others that deal withvery high volume of stocksbased on mandate frominvestors.

“These are the people DMOis probably looking for andthese people do not havemuch of retail investors. Ifthese people do not have suchpeople and the advertisementwants high profile stockbrokers, it cannot achieve thepurpose because they will nothave retail investors to dealwith.” He insisted that there

is need for all concerned towork towards bringing retailinvestors back to the market,saying “ what we have isballoon investors that come inwith a lot of money, trade inthe market and mop up themarket when the prices go upand make excessive moneyand run away.

“But we needed toencourage retail investors;that is why I got angry whenI saw publication by DMOasking for stockbrokers thatwill deal in government bondon what they calledgovernment stock brokers.”

He explained that retailinvestors are those that have1000, 5000 and 10000 units ofshares, saying that the typeof people requested by DMOdeals with higher volume ofstocks.

Speaking further he said,“Many investors areinterested in short terminvestment. They want tomake profit and leave. It is asa result of lack of confidence;nobody wants to do long terminvestment. We need tocultivate retail investors.”

CUTIX records10% turnover,decries influx ofsubstandardcables

BY NKIRUKA NNOROM

Cutix Plc, an indigenouscables manufacturing

company, has blamed influxof cheap and adulteratedautomotive and electricalcables into the nation’smarkets for the stuntedgrowth of the sector in thecountry.

Presenting the account ofthe company for the yearended 30th April, 2011 beforethe shareholders, thechairman, Engr OkwudiliNwosu, Nigeria’sAmbassador-designate toBurundi, said that though theturnover for the period roseby 10 per cent from N1.44billion to N1.57 billion, theprofit before tax declined by5.3 per cent from N125million to N119 million.

This notwithstanding, thecompany declared a dividendof 12 kobo per share and abonus of two new shares forevery three previously held.

He stated that lossesincurred within the periodwere occasioned by a lot ofvariables that included thesharp increase in the pricesof two raw materialcomponents, cost of which thecompany resisted passing tothe consumer.

He cited other issues thathampered the expectedincrease in the profit toinclude total dependence ongenerating sets for itsoperations as alternativesource of power supply evenin the face of high price ofdiesel.

He said he is optimistic thatthe unbundling of the PowerHolding Company of Nigeria(PHCN) would engenderefficient supply of energy inthe country, and hence animproved performance forcompanies.

To maintain its leadership inthe cables manufacturing anddistribution sector in thecountry and Africa, thecompany has sustained thetraining and re-training of itsstaff locally and overseas. Ithas also concluded plans toacquire some state-of-the-art

cutting edge machineries toincrease efficiency, outputcapacity and capability,Nwosu said.

“They include drum-to-drum rewinders, shrinkwrappers, double twistbunchers, extruders, rigidcage stranders and coilersamong others.

*From left; Arunma Oteh, Director-General of the Securities and Exchange Commission (SEC);Oscar Onyema, Director-General of the Nigerian Stock Exchange (NSE) and Muhammed K.Ahmad, Director-General of National Pension Commission (PENCOM) at the 4th quarter CMCmeeting in Lagos held last week.

THE Securities and Ex-change Commission(SEC) has disclosed

its plan to engage Asset Man-agement Corporation of Ni-geria (AMCON), CentralBank of Nigeria (CBN) andFinancial Market Dealers As-sociation (FMDA) on how to

SEC to engage AMCON, CBNon market making for bonds

stimulate market-making onAMCON bonds.

Director-General, Securitiesand Exchange Commission(SEC), Ms. Arunma Oteh,who disclosed this during thefourth quarter of the CapitalMarket Committees (CMC)meeting in Lagos last week-end, said some of the commit-tees’ plan for 2013 will in-

clude engaging the AMCON,CBN and FMDA to stimulatemarket-making on AMCONbonds both in the interbankmarket and trading on ex-changes.

“We also intend to boost se-curities lending on bonds aswe liaise with the NationalPension Commission (Pen-com) and the relevant trading

exchanges to set up a robustand efficient operating frame-work for securities lending.Also in 2013, we hope to havea robust trading platform onthe Nigerian Stock Exchange(NSE); Active participation ofthe NSE and National Asso-ciation of Securities Dealers(NASD) in licensing of mar-ket makers and commence-ment of market-making infixed income securities.”

Other action plan that thecommission hope to achievein 2013, according to Otehinclude: Development of theMortgage Backed Securitiesand Asset Backed Securitiesmarket: Amend the NSE list-ing guidelines by removingthe requirement for SEC no-tification of approval of thebasis of allotment on publicoffers which are either sold bybook - building or firmly un-derwritten.

Speaking further, the SECboss narrated some of theachievement of the CMCsince last year to include:Amendment of Personal In-come Tax Act (PITA) whichwas gazetted with a com-mencement date of 14 July2011.

According to her, “TheCMC facilitated also the Com-panies Income Tax ExemptionOrder and a Value Added Tax(Modification) Order whichwere issued by the Presidentand the Hon. Minister of Fi-nance in 2012. The collabo-ration led by the NSE, DMOand NASD will work to real-ize the introduction of marketmaking for debt securitiesparticularly the illiquid Cor-porate and sub-national secu-rities.”

Oteh also disclosed thatthere will be an ongoing re-view of draft securitizationrules by the commission andcommended the NSE for itsrole in implementing marketmaking for equities and intro-duction of securities lending.

Continuing, she said, “TheNSE has made recommenda-tions for the privatization ofthe Power Holding Companyof Nigeria (PHCN) and list-ing of the offshoot companies.There is also work in progressto amend the rules of feederfunds and Funds of Funds;New Conduct of Businessrules are in the offing. Themarket is making amend-ments to the regulation re-garding infrastructure Funds.Also, there is ongoing effortto benchmark Pension FundAdministrator (PFA) perfor-mance against respective assetclasses. The market is review-ing the requirement for PFA’sto divest from securities down-graded (to be more specific);The market is considering a re-view of the requirement restrict-ing investment in the securitiesof one company to a maximumof 20 per cent to make it appli-cable to policy holders only.”

Vanguard, MONDAY, NOVEMBER 5, 2012 — 25

CMYK

Corporate Finance

BRIEFS

Mansard Insurance Plchas posted Gross Pre-

mium Income, GPI, ofN10.05 billion for the thirdquarter ended 2012.

According to its unauditedthird quarter financial resultsfor the period ended Septem-ber 30, 2012 the figure rep-resents a 22 per cent increasefrom the September 2011 fig-ure of N8.26 billion.

Net premium revenue stoodat N3.55 billion from N2.92billion of the preceding peri-od to represent a 22 per centgrowth as well while invest-ment income & other operat-ing income was N1.26 billionup 91 per cent from last Sep-tember’s figure of N662 mil-lion.

Profit before tax was N1.37billion from N811 million ofthe preceding period whichis an increase of 68 per centwhile profit after tax of N1.22billion, an increase of 98 percent against N619 million ofthe preceding period.

Commenting on the compa-ny’s performance, Chief Cli-ent Officer, Tosin Runsewesaid that the result validatesits leadership position with-in the industry and showsthat it remain on track to-wards achieving strategicgoal for the year.

World shares,crude oil dipdespite strongerU.S. jobs

Global stocks and crudeoil slipped on Friday

even after a U.S. employmentreport for October surpassedexpectations, as investorslooked beyond next week’spresidential election to thelooming “fiscal cliff.”

The dollar climbed to amore-than-six-month peakagainst the yen and a three-week high versus the euroafter U.S. employers steppedup hiring and the unemploy-ment rate ticked higher asmore workers renewed jobhunts, a hopeful sign for theeconomy.

But other data highlighteda mixed picture. Demand forU.S. factory goods rose inSeptember by the most inover a year, but a gauge ofbusiness investment plansshowed lackluster momentumin the recovery despite aslight upward revision.

“The (jobs) report itself wasgood but just not goodenough, especially after thepre-rally we had yesterday.”

From left: Executive Director, Market Operations Technology, Nigerian Stock Exchange, Mr.Adeolu Bajomo; Chief Executive Officer, NSE, Mr. Oscar Onyema; Managing Director/CEO,Presco Plc, Mr. Uday Pilani and Executive Director, Business Development, NSE, Mr. HarunaJalo-Waziri at the Presco Plc Facts Behind the Figures presentation at the NSE in Lagos.

By CHINEDU IBEABUCHI Equities' value on NSEdrops by N101bnT

he value of listed equities on the NigeriaStock Exchange, NSE

depreciated by N101 billionlast week.

This was occasioned by asignificant fall in share pric-es of highly capitalised equi-ties.

Specifically, the key marketindicators represented by themarket capitalisation and theAll-Share Index both droppedby 1.18 per cent each.

The market capitalisationwhich opened at N8.565 tril-lion shed N101 billion to closeat N8.464 trillion; while theAll-Share Index fell by 316.52basis points to close at26,559.55 points from26,876.07 points.

Fifty-one companies lost inshare prices compared totwenty one stocks that gainedin the week under reviewcompared to twenty-twostocks that gained and thirty-nine stocks that lost in shareprices in penultimate week.

Nestle Nigeria Plc led onthe losers’ table with a loss ofN25.50 to close at N670.00 pershare; followed by NigeriaBreweries Plc sheddingN6.45 to close at N128.55 pershare and Cadbury NigeriaPlc lost N2.35 to close atN27.00 per share.

Other share price losers inthe top ten category include:Julius Berger Nigeria PlcN1.55, MRS Oil Nigeria PlcN1.53, Cap Plc N1.16, ConoilPlc 1.03, PZ Cussons NigeriaPlc N0.57, U A C N Plc N0.54and Honeywell Flour Mill PlcN0.53, among others.

On the contrary, Glaxo-

SmithKline Consumer Nige-ria Plc led on the gainers’ ta-ble appreciating by N2.89 pershare to close at N41.89 pershare; followed by UACNProperty Development Com-pany Plc gaining N1.09 toclose at N12.50 per share andAshaka Cement Plc rose byN1.07 to close at N18.13 per

share.Other share price gainers in

the ten top category include:Portland Paints and productsPlc N049, Okomu Oil Palm PlcN0.49, Guinness Nigeria PlcN0.41, Berger Paints Plc N0.40,Union Bank Nigeria Plc N0.28,Zenith Bank Plc N0.27 andCutix Plc N0.23, among others.

Equity trading recorded asignificant improvement, ap-preciating by 90.4 per cent,with a turnover of 1.512 billionshares valued at N12.95 billionin 23,039 deals compared to794.043 million shares valuedat N8.515 billion in 14,048deals transacted in penulti-mate week.

UACN, Okomu Oil, others underpricedon NSE

BY AUGUSTINE NWANGE

It has been observed thatUACN Plc and someother equities on the

Nigerian Stock Exchange(NSE) are outrageouslyunder-priced. The currentmarket price of UACN Plcshould be about N116.34 notN40.30 as it is now.

It should be noted that themost useful information in theStock Market Table asregularly published are:- Theopening price, the closingprice, the Earnings Per Share(E.P.S) and the PriceEarnings Ratio (P. E. Ratio).The P.E Ratio figure is veryimportant in an investor ’sdecision to buy or to sellequities.

Proof:- UACN PIc is theonly blue chip company inthe conglomerate diversifiedindustry. It is a highlycapitalised company with a

large paid-up share capital.At its Earning Per Share (E.P. S) is currently N7.03. It isone of the ten (10) mostprofitable companies that arequoted on the Nigerian StockExchange (NSE). If UACNPIc is evaluated on a scale ofthe average Price Earnings (P.E.) Ratio of the NigerianCapital Market as at today,UACN Plc, (because of under-pricing) will have a deficit P.E. Ratio of 15.00 minus 4.14which is 10.86 point. Thisdeficit is due to the erroneousjudgment of dealing clerks(Broker). This deficit reducesthe capital appreciation scoreof UACN Plc by 10.86 points.In value terms, this deficit willbe 10.86 multiplied by N7.03(the E. P. S. of UACN Plc),which gives N76.34. Thecorrect price of UACN Plcshould then be N40.00 plusN76.34 which amounts toN116.34 per share.

By the same reasoning,Okomu Oil Palm Plc isoutrageously under-priced.The current Market Price

should be N1OO.09 insteadof Nl4.00 as it is now.Guinness is under-priced asat October 2012. The currentmarket price should be aboutN340.63 instead of N281.00.Beta Glass Co. PIc isoutrageously under-priced.The current market priceshould be N45.25 instead ofN10.03. Nigerian Breweries(NB) PIc is overpriced. Themarket price should beNI09.51 instead ofNI42.00 asat October 2012.

Proof: As shown in thebeginning above, 15.00 weretaken as the Average P.E.Ratio of the Nigerian CapitalMarket. As at October 2012,Nigerian Breweries had a P.E.Ratio of 22.22 which is asurplus of 7.22 points overand above the NigerianCapital market Average P. E.Ratio of 15.00 point. Thissurplus increases the capitalappreciation. Score ofNigerian Breweries by 7.22point. In value terms, this7.22 points multiplied byN4.50 (the E. P. S. of NBL)

which is N32.49. The currentmarket price of NigerianBreweries PIc should be Nl42(the high price) less theexcess price of N32.49; whichis NI09.51.

Nestle Nigeria PIc isoutrageously over-priced.The market price should beN418.44 instead of N625.00as at October 2012. EcobankTransnational Incorporation isoutrageously over-priced.The market price should beN8.00 instead of N11.05 as atOctober 2012. LafargeWAPCO PIc is outrageouslyover-priced. The market priceshould be N29.65 instead ofN57.50 currently.

In conclusion, thosecompanies that are under-priced should be attractive toprospective buyers of shareswhile those investors whosecompany shares are over-priced should be encouragedto sell their shares.

Nwange is a fellow of theChartered Institute ofStockbrokers.

MansardInsurance growsGPI by 22% inthird quarter

26 — Vanguard, MONDAY, NOVEMBER 5, 2012

CMYK

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Vanguard, MONDAY, NOVEMBER 5, 2012 — 27

CMYK

Micro Finance

BRIEFS

BY PROVIDENCE OBUH

Members of theAssociation ofM i c r o -

Entrepreneurs of Nigeria(AMEN) took to the street, lastweek, on a ´One-Million-Man-March´ to sensitiseNigerians, especially youthson the need to be selfemployed.

In this interview, theAssociation’s President,Prince Saviour Iche spokewith Financial Vanguard onhow to groom the nextindustrialists who arecatalysts to achieving thevision 2020 and other issuesaffecting operators in thesector. Excerpts:

What is the drive behind themarch, and what do youintend to achieve?

What we want to achieve isto sensitise Nigerians thatunemployment is on theincrease because after schoolor graduation, a lot of youthsseat at home and fold theirhands, while looking forwhite-collar job. We arecreating awareness to informthem that AMEN wants toestablish a centre whereby wecan nurture and trainupcoming entrepreneurs. Ifyou compare our product toothers, you notice the efficacyin our products. It isrecognised all over the world;we have the brain, but whatwe are lacking is theworkforce and ability to accessfund.

Who are your partners orsponsors in this project?

We wrote to the Federal andthe state government forassistance and partnership inthis programme, I can tell youwe did not receive anythingfrom them, we even sent aletter to the President, therewas no response, we arespending our hard earnedmoney, we are doing thesethings because this nationbelongs to all of us.

How have you affected theeconomy?

This association is in itssecond year and I want to tellyou that we have put smilesinto the faces of our members.In Lagos alone, we have about300 members that are intomanufacturing or services. Westarted in Lagos in 2010 butwe have spread over to eightother states, AMEN is aNational team, and over 50 ofour members’ products have

IFC to issuemicrofinancebond via Daiwa

International FinanceCorporation (IFC), a

member of the World BankGroup, and Daiwa SecuritiesGroup Incorporation hasunveiled plans to issue amicrofinance bond to expandaccess to finance for poor andlow-income entrepreneurs indeveloping countries.Basic financial services suchas microfinance, which makesloans available to low-incomeentrepreneurs can become apowerful instrument to reducepoverty in developingcountries, IFC and Daiwahave said.The corporation said in arelease, “It enables deprivedpeople to build assets,increase income, and reducetheir vulnerability toeconomic stress and the four-year bond will be issued inSouth African rand andTurkish lira.”According to the corporation,the offering period would lastbetween November 1st andNovember 16th, 2012, whilethe maturity date of the bondsis November 21, 2016.The interest rate will be 4.68percent per annum on theSouth African rand issuance.It will be 5.23 percent perannum on the Turkish liraissuance. The issue will bearranged and distributed byDaiwa Securities Co. toJapanese retail andinstitutional investors.

Banks should nurture MSMEsto grow —AMEN President

been registered with NationalAgency for Food and DrugAdministration and Control(NAFDAC)

Do you think thisassociation can grow theNigerian Economy?

Yes we can! The governmentkeeps publishing billions ofnaira given to MSMEs in thepages of newspapers, but wehave not seen it.

I want to challenge theBank of Industry (BoI) tocome out and tell Nigeriansthose entrepreneurs who arebeing given billions of nairathat we are hearing andreading on the pages ofnewspapers, we needevidence.

Another thing is that thebanks in Nigeria are nothelping matters, they are onlyripping us off. They are onlygoing to where things arealready made; they do notwant to suffer, let themnurture small businesses togrow.

Coca-Cola started small.They started by giving theminerals inside cup, buttoday, Coca-Cola is amultinational company.AMEN members have what ittakes to be the next Dangotes.AMEN members are themillionaires in the making,they are the people that willmake Nigeria anindustrialised nation as wella catalyst to actualising thevision 2020.

Have you ever consultedBoI and what is the feedbacklike?

property? I can tell you boldly,my father don’t have a landedproperty, so where do theyexpect me to get it.

In other countries, what theyexpect is your brain, they buyyour idea, they buy yourproduct, they nurture you, andthey watch you grow, but inNigeria, they are looking foralready made businesses.

We have written to the BoIseverally and they have calledus, but before you can accesstheir fund, you will sell theonly land given to you by yourforefathers. They will ask youto bring a landed property.Where do they expect a microentrepreneur to get a landed

Give a micro entrepreneurN100, 000 and watch him inthe next five months and seewhat he will become, some ofus just need 100, 000 tosurvive.

We are the major employersof labour; we have what ittakes and all our work are

from ideas, but because of allthese foreign companies,whose staff spend six yearsas casual workers, theyneglect us. This is what weare saying, we are ready toemploy Nigerians but weneed fund.

So what are the NAFDACrequirements?

To get NAFDACregistration, you must haveat least four rooms, but mostof our members are leavingin one room. They cannotafford a self contain, this isthe group of people from thegrass root.

What have you done to getyour members’ productsregistered?

We have gotten a place wecan call our own at Ikorodu.They call it the IndustrialDevelopment Centre (IDC)given to us by the Small andMedium EnterprisesDevelopment Agency ofNigeria (SMEDAN). In thatplace, we allocate space tomembers who can not afforda factory of their own, we alsoensure our members havedocumentation, we educatethem and nurture them onhow to do things right. Withcollective effort, we arefighting a common cause toachieve a common goal.

,

,

AMEN members have what ittakes to be the next Dangotes,AMEN members are themillionaires in the making, theyare the people that will makeNigeria an industrialized nationas well a catalyst to actualizingthe vision 20-2020.

Former Gov. OlagunsoyeOyinlola of Osun State

was guilty of leadershipfailure, the Commission ofInquiry set up by the stategovernment to investigate aloan of N18.38 billion by hisadministration, said in itsreport. The commissionwhich was chaired by Prof.Femi Odekunle, was set upby Gov. Rauf Aregbesola inSeptember and mandated toinvestigate the circumstancessurrounding the procurementof the loan from United Bankof Africa Plc. The governmentalso mandated the panel toinvestigate the conduct ofOyinlola, among other issues. The commission, whichsubmitted its report toAregbesola in Osogbo onWednesday, blamed theformer governor for heedingthe advice of the State Houseof Assembly.

N18.38bn Loan:Panel indictsOyinlola

AMEN President, Prince Saviour Iche

28 — Vanguard, MONDAY, NOVEMBER 5, 2012

Interview

BY OMOH GABRIEL,BUSINESS EDITOR

Last week, Mrs FunkeOsibodu who wasdrafted by the CBN

Governor, Sanusi LamidoSanusi, in August 2009 torescue Union Bankcompleted her assignment.She had a valedictoryinteractive session with themedia where she outlined thespirited efforts put up by herteam of rescuers to bring thebank back to life. Today shesaid the bank is not just big,strong, but more reliable thanbefore.

Excerpts

You said you are going onleave and after a while, youwill return to Union Bank.Please can you be explicitand give us details on whyyou are coming back?

I didn’t say after a while Iwould be returning to UnionBank. I said I would beleaving to proceed on leaveand I have my accumulatedleave till end of December.So, technically, I am still astaff of Union Bank till the endof December. I was onlytalking about the transitionwith the new Chief ExecutiveOfficer that we have beenworking silently together andhe would take over officiallyon Thursday. When I leave,if there are things that areunfinished, I would come inand sort them out. So, I amnot returning to Union Bank,I will just be performing myduty as a staff of Union Banktill the end of December.

As the last person standing,what have been yourexperiences so far in tryingto bring back Union Bank?

Union Bank is the last manstanding, not me. Union Bankhas been a very interestinginstitution to work for and itis an institution with a veryrich heritage in terms ofrelationships and people. Ibelieve I have stayed thislong because it is a hugeinstitution and achieving thegoal which was set when thegovernor asked us to comewas basically to stabilise theinstitution. I have played mypart in moving it to a greaterheight. In fact, I give kudosto the outgoing board becausefrom day one, they came to adecision that Union Bank willstand on its two feet againand we would do our best tosee to it. So, from thatperspective, we looked forinvestors that would ensureour going forward and thatsome of those things thathappened in the past wouldnot surface again. As you allknow, we now have coreinvestors called Union GlobalPartners Limited and what is

I am leaving Union Bank thswimming in money, strongmore reliable

unique about them is thatthey are foreign investors whobrought very strong corporategovernance and internationalexposure to the bank. As someof you know, externally, theyhave been making their ownpress announcement that theyhave invested in Union Bank.So, when you bring foreignersinto this kind of environment,their time frame is notnecessarily as fast. Andsecondly, the methodology weuse is different from otherssuch that it required carefulprocess of regulatoryapproval.

Why was there delay inrecapitalising the

bank?While we wanted it faster, we

couldn’t get it faster but weare close. Again, to ensurethat there is smooth transition,I had to stay and be part ofthe new board which startedin February and see that thereis a new executive so thatwhen I leave, someone willstill be around. As you know,three out of four formerexecutives - Ibrahim, Kunleand Phillip - are part of theprocess to see that thetransition is successful. Twonew executives will join us;one of them would not bejoining us until sometimenext year which will make ita complete team plus the newchief executive. So, it wasplanned so that the change inmantle will be smooth.

On my own side, what havekept me going are differentthings. Some are positive andsome not very positive. WhenI read the newspapers, thenegative speculations give methe energy to say ‘I would stayand prove them otherwise.The positive ones when wewere celebrated for what wehave done so far and from thepeople themselves.’

If you could remember, atsome point when we neededshareholders to agree to ourscheme document, we neededstaff and shareholders to worktogether, that was one pointwhere I saw the real strengthof Union Bank. Our staff,pensioners and shareholdersall worked together to see thatUnion Bank retained that lastman standing. So, as the last

man standing, generally, ithas been so many things inbits and pieces that haveensured that we aresuccessful.

What was wrong when youtook over and how are theperformance indicators nowthat you are leaving

When I came in, there werethree things that were wrong.These were corporategovernance, negative capitaland liquidity crises. Within thefirst three months, we got overour liquidity situation. On ourliquidity ratio that wasnegative, I am leaving thebank with liquidity ratio ofover 80 per cent; it is around90 per cent positive.

The statutory minimumrequirement of liquidity, ratio-

wise, is 25 per cent. We areleaving the bank above thestatutory minimum. In otherwords, we are now swimmingin money and immediateportion of it came from thenew capital that came in andthe loans we sold to AMCON.When it comes to negativecapital, I think at our peaklevel, our shareholders’ fundwas negative, somewherearound 300 or 400, that isabout N378 billion negative.At that point, even theshareholders had technicallylost all their money.

Today, we have positivecapital of N190 billion. So, wehave moved from negative ofN378 billion to N190 billionpositive. That is over N570billion positive to change that.That is something that took

quite a lot of work by all of us.On the corporate governance side,

you remember the corporategovernance issues were thateverybody was doing his own thingand there were so many things wehad done wrong. I think the exampleI can use is that now we are 95. Atthat time, we were 92 or 93 yearsold.

When you go to an old woman’shouse, you are bound to find a lot ofcobwebs because she will not throwso many things away easily. It iswhen the children come and say‘Grandma, why are you still keepingthis?’ And she will say ‘leave itthere,’ and they will forcefully takeit and throw it away. Our own jobwas to go and clean out several ofthose cobwebs. I believe we havedone a reasonable job. There aremany things we have cleared up.Remember, I used to say we haveun-reconciled accounts of over N3trillion.

What is the size of accountsyou have reconciled so far?

Today, our un-reconciled accountsare in the hundreds of millions andnot billions any more. We have anarmy of over 150 people that workday and night cleaning it up. So, thatis part of the cobwebs we werecleaning up. We had bad loanswhich we sold to AMCON; we wroteoff some, we negotiated some andwe now have a unit called PortfolioManagement. Their job is tomanage those bad loans and resolvethem. It means that our loan portfolio

,

,

When I read the newspapers,the negative speculations giveme the energy to say ‘I wouldstay and prove them otherwise.The positive ones when wewere celebrated for what wehave done so far and from thepeople themselves.’

*Mrs Funke Osibodu, former MD/CEO Union Bank handing over to Emeka Emuwa the New Managing

Director.

Vanguard, MONDAY, NOVEMBER 5, 2012 — 29

Interview

that isng and

reduced from over N700 billion toaround N200 billion now. All thethings clustering us have gone. Itis now for us to build on it. Somepeople used to say that UnionBank is for old people. A youngman would say that is the bank ofmy father or my grandfather.‘They took me there those days.’We have good news for you; wehave an army of at least 1,000young people recruited withinthe last three years. So, wehave new blood that hastaken over Union Bank.

What will you say aboutthe Union Bank you areleaving behind?

The way we havedescribed the new UnionBank is that there are two ofus necessary for the future ofUnion Bank – the olderpeople like us withexperience and the youngerpeople who we call energy –So, imagine the new UnionBank with energy andexperience. While theexperience tells you what to do,the energy works on it very fast.

So, several things have changed.You will see it in our customer care.I have seen several customersexpressing amazement aftervisiting our staff. When a customercomes in, we try our best to be fastin attending to him. You have seensome of our branches; some ofthem are very run down, but wehave a new face of the branches.We have launched at least 75 outof over 300 branches. Thesechanges are what I call thefoundation to move to the nextstage.

What are your projections for

Union Bank in the next one year: When we came in, some of our

customers went to the branches towithdraw and our staff were tryingto pacify them, to convince themnot to, but I told them that theyneed not do that, they should letthem take their money. Then theywill see that even though you weresacking, you are still big andstrong. They did and within ashort while, they returned andthroughout the three years, (andthis is very important because ittells you the strength of UnionBank), our savings accountcontinued to grow. Our currentaccount also continues to growand these two are very strongmark of confidence and, it islargely from our retail networkboth at the rural and all othersmall branch networks becausethey are all in small pieces

everywhere. So, that ruralside if you call it rural, I callit retail and there is nowherethat is rural anyway becausethere is nowhere you cannotreach with technology today.So those locations became abedrock for savings/deposits,they are what I call low costdeposits that continue to be

our confidence and you wouldhear from those customersthat this is my bank ‘I amgoing nowhere and nothingwill happen to it.’ So in thatarea, we did not have anyissue in terms of ourperformance. On technology,again, to some of us that werehere at the early stage, whilewe had computers, mostpeople could not usecomputers; it was largely onthe secretariat side becausethey were not educated to useit.

They didn’t need to use it.You give it to the secretary andthe secretary does the typing.Today, when it comes tobanking, using technology iseverything whether it istelephone banking, internetbanking, cashless bankingand the latest, POS cashlessprocess. We are now number

one in terms of active POS. Inever dreamt that we will getthere to be number one interms of active POS. In otherwords, customers are usingour machines. They will onlyuse your machines when youhave educated them well.

You have enough machinesaround and you are makingsure that those machines workand the customers use them.We are the first on that list;we are not the first in termsof total volume because we arestill smaller than several

banks, but we were the firstin terms of activity and that istechnology. For the mobilebanking and internetbanking, again, we did notneed to buy anything new. Wehad them, we just needed toopen them up and get ourcustomers to start using, andget our staff to appreciate andstart using it. So, whether itis credit and debit alert,whether you want to transfermoney from one account tothe other using your phone,whether it is going onlineusing your computer to movemoney, we do all that. Weused to have a very lownumber of cards that we hadissued to our customers; nowthat is a thing of the past andbefore someone was tellingme when they ask for a card,at best if it is very fast, it willtake you about two or threemonths to get it, andsometimes you pray it doesnot take you six months.Today, the maximum it willtake you is ten days. We areworking on turning around tomake it 48 hours but fromwhere we were coming from,we are very fast. We still havea long way to go in terms ofmaking it 48 hours but, evencheque books use to takeforever, now there is a turnaround. I ask for chequebook, I get it by afternoon orlatest by the next day. So, alot has happened on thattechnology side which we areon top of. Even, we have thetechnology, we have notopened it to the public whereyou can use your naira cardas some banks do abroad; wehave it.

Can you still say thatUnion Bank is big,

strong and reliable?We will be starting it very

shortly before the end of theyear and we have had it for awhile. So what amhighlighting to you is thatthat big, that strong, thatreliable, is back. The firstoffice I went to somewhere inAbuja when I resumed, I wasjust walking in and somebodysaid ‘big, strong reliable’ andI looked at the person and Isaid ‘this was the securityman at the gate, how did thisman know that I was in UnionBank, is my face that public?’He saw the way I looked athim and he just pointed at thisbig, strong reliable on mylapel, that is how strong ourbrand is. You will see it insome of our televisionadverts. So, that is why ourlatest advert says ‘we’ve justonly begun.’ Our only justbegun means that we arestarting a new phase, we areno longer an old institution,we are a young and vibrantinstitution and you shouldwatch out.

When you go into projection

till the end of the year, wehave published our Juneresult and I think it surpassedeverybody’s expectations.September will soon be out.We are putting finishingtouches and the trend is stillthe same and I expectDecember to be the same. Fornext year, I expect that trendto continue, because fromnext year we will not be here;we will no longer be havingthe saying that we were tryingto make a change. We havemade the change. It is nowbuilding on the change anddoing the business and thatis easier. It is easier to buildthan to lay the foundationbecause foundation holds theerector and nobody will see ituntil the pillars are out now.So, it is easy to see thebuilding the workers will gointo.

What is the currentshareholding structure ofUnion Bank?

On the shareholdingstructure, what we havecurrently is that UGPL(Union Global PartnersLimited), own 65 percent;AMCON still retain 20percent shareholding andexisting shareholders have 15percent. The bank wascommended that it retainedthe largest shareholdingstructure for existingshareholders in theintervened banks.

In some of the intervenedbanks, some lost it completelyand it became a differentbank. So, part of our focus onthe re-capitalisation processwas actually to negotiate thebest deal for existingshareholders. UGPL camewith $500 million to acquire65 percent of the bank and inthat process; we still managedto maintain 15 percent forexisting shareholders.

The UGPL shareholders ismade up of foreign groupsmainly, the StandardChartered Group throughStandard Chartered PrivateEquity, we also have CorselCapital, which is a majorprivate equity capital whichis based in US and UK. Wealso have AfricanDevelopment Corporation,which is a German privateequity firm that owns banksin East Africa also one of themajor investors in the bank.

Then, we also have FMOwhich is the DutchDevelopment FinancialInstitution. They are also amajor stakeholder and thenwe also have Akia Capitalwhich is the Belgian Group.They are also one majorstakeholder and of course,African Capital Alliance,which we all know alsoinvests in lots of companiesin Nigeria.

,

,

We will be starting it veryshortly before the end ofthe year and we have hadit for a while. So what amhighlighting to you is thatthat big, that strong, thatreliable, is back.

*Mrs Funke Osibodu

30 —Vanguard, MONDAY, NOVEMBER 5, 2012

CMYK

BRIEFS

Housing Finance

Mr. ChiedozieUdechukwu, an

Architect committed tocreating cost effectivepremium houses with lowmaintenance cost, also theManaging Director/CEOMastermarks Limited, acompany that specialises inBuilding Design,Construction and Real EstateDevelopment, in thisinterview, he talks on the 17million housing units deficitNigeria is facing with, theopportunities and thechallenges in the Real Estatebusiness. Excerpt:

What are the opportunitiesin real the estate business forNigerians?

Real estate has a greatopportunity for everyone whounderstands the way to goabout it, Nigeria has a deficitof about 17 million housingunits and what this means isthat even if Nigeria has onethousand housing unitseveryday; it will take Nigeriaabout 50 years to meet thepresent housing demandsand that is if the populationremains constant. It looks likesomething that will takelonger than fifty years andthere is a probability ofachieving this. What thismeans for an investor is that'it is an open market, a marketthat does not have an end inview, because the demand isthere and the demand is everrising and based on this,anybody who puts money intoreal estate, under properguidance will always smile tothe bank.

Professionals also have theopportunity of comingtogether and pullingresources together instead ofwaiting for the client that willnever come. Instead ofwaiting for the governmentthat is not willing to financethe sector. The professionalscan come together, pull theirresources together and investtheir resources in real estateand then share the profit. Theycan do it under a sustainableframe work.

What are the challenges inthe Real Estate Investmentsector of the economy?

First, the greatest problemof real estate in the countrynow is finance, second is theknow-how and the rightoperatives.

People that have the moneyto go into real estate don’thave the knowledge, eitherthey build real estates that aretoo expensive or they dosomething that looks ugly andtherefore not attracting theright type of frame.

Nigeria’s housing deficit, open marketfor investors – MD Mastermarks

BY PROVIDENCE OBUH

But in Mastermarks we havealways advocated premiumquality with low maintenancecost, so we try always to seethat we work within the costand then make sure thequality is the best you canfind anywhere, and this is theopportunity anybody has inreal estate but because there

professionals go on and on,finishing one job and lookingfor another, and never beingable to accumulate wealth.Based on my experience, aprofessional can never bewealthy by his skill or salary,to be precise, anybody thatmakes his income by way offees or salary can never be

little to do much and they cando this through employingconsultants that could accessa company and see whetherthe company is qualified,check the track record of thecompany, determine whichcompany is on the right trackand also the company thatrequires support. In that waythe government could throughthe bank assist the Real Estatecompanies to do much for thenation and help reduceunemployment drastically. Weadvertised for one siteengineer and over 500 siteengineers applied, that wasoverwhelming. These arepeople that could be rightlyengaged if the right supportis given to genuine real estatecompanies. I tell you, withone billion for instance, wecould be able to create twothousand jobs, we couldcreate 800 thousand housingunits. We could turn thatmoney around and get N500,000,000 in one year becausewe operate with economy ofscale. What this means is that,we buy in large quantity andthen add little mark ups,making the houses cheap, sowe could sell faster, andbecause it is cheap, we sellgreat number of these houseswith small profit and it addsup to a great profit over aperiod of time and we can dothis many times a year,employing a great army ofworkers who are out therelooking for opportunity to dothat which they have investedtheir lives in. That alone couldtake crime away from thestreets because this peoplewill earn money and be ableto take care of their family.

What is the relationshipbetween Mastermarks andTeamaction

Mastermarks limited is acompany that has been inexistence for over 25 years.

We started strictly as adesign firm in 1987 and by1992 we incorporatedMastermarks limited in orderto be able to offer services inconstruction.

M a s t e r m a r k smetamorphosed toMastermarks limited fromDesign Company to Designand Construction Company in1992 and since then we havebeen offering great services inthese areas and of recent wegot into real estatedevelopment and real estateinvestment. TeamactionInternational is an investmentclub which comprises of sevenother companies, constitutedas a duly registered limitedliability company. This isaccording to the CorporateAffairs Commision (CAC0rule which states that privatelimited liability companiescan not take more than fiftyDirectors.

are no easy source of finance,professionals who could dothe work watch quacks do thework and take all the moneywhile they (professionals)keep running about lookingfor who will patronise them.It is quite devastating thatprofessionals do all the workwhy the people that providethe money for this projectmake all the money, so

wealthy unless they retrace.How is government

encouraging operators in thesector?

There is the agriculturalloan which is subsidized bygovernment and there areother areas where thegovernment has actuallyshown interest. In the RealEstate the government couldsupport those who have a

We have a deficit of about 17million housing units and whatthis means is that even if Nigeriahas one thousand housing unitseveryday, it will take Nigeriaabout 50 years to meet thepresent housing demands andthat is, if the population remainsconstant.

,

,

Arc. Chiedozie Udechukwu, MD, Mastermarks Limited

Regulators tocreate nationalm o r t g a g edatabase

The Federal Housing Finance Agency (FHFA)

and the Consumer Finan-cial Protection Bureau(CFPB) have teamed up tobegin work on the NationalMortgage Database, whichis billed as the first-ever“comprehensive repositoryof detailed mortgage loaninformation.”

Development of the data-base, which is being de-signed to track as far backas 1998, is now underway,and the agencies expect ear-ly versions of the full datasetto be complete in 2013.According to the agencies,the database will primarilybe used to “support theagencies’ policymaking andresearch efforts and to helpregulators better under-stand emerging mortgageand housing market trends.

“The agencies claim thatthe database is being creat-ed due to a “lack of compre-hensive data available on acomplete, national scale.”The database is being de-signed to match a nation-wide sampling of credit bu-reau files on borrower ’smortgages and payment his-tories with informationalfiles, such as the HomeMortgage Disclosure Actdatabase, property valuationmodels, and other data filesto create a comprehensivepicture for each mortgage.

Decrease inpersonal insolvencynot all positive

Overall levels of personal insolvency have

fallen 7.2 per cent in Q3,compared to the same peri-od last year, although therewas a slight increase (2.45per cent) on the previousquarter.

Figures released by thegovernment’s InsolvencyService reveal that 28,062people entered into bank-ruptcy, Individual VoluntaryArrangements (IVAs) ortook advantage of Debt Re-lief Orders (DROs).Meanwhile, Nick Reed, Di-rector and personal insol-vency expert at PwC, saidthe news was not all posi-tive.

“The decrease in total per-sonal insolvency comparedto the same time last year ispositive and demonstratesthe trend of people payingdown debt,” said Reed.“However, the levels of per-sonal debt remain high andshow a slight increase sincethe previous quarter.

Vanguard, MONDAY, NOVEMBER 5, 2012 — 31

BRIEF

Insurance

By ROSEMARY ONUOHA

The recent flooding insome parts of thecountry has left some

devastating impacts in itswake. Although the FederalGovernment has promised thatit will do all within its powerto ensure that such disastersdon’t leave behind hugedamaging impacts in thefuture, so far, government isyet to say whether there areplans to include insurance inthe scheme of things.

The devastating impact ofthe flood, according toManaging Director of LasacoAssurance Plc, Mr. OlusolaLadipo-Ajayi, exposes the lackof insurance awareness in thecountry. “When elites don’tinsure, how do you expectpeasants to take up any formof insurance? Ladipo-Ajayiqueried.

The majority of the peoplethat have so far been affectedby the flood are mostly of thelow income brackets that areaverse to insurance due tofactors of poverty and lack ofawareness. As a result, expertsare of the opinion thatgovernment can help inrebuilding the lives of thesevictims as well as the economyof the affected areas if itstrategically include insurancein all its planning.

According to the GroupManaging Director, MutualBenefits Assurance Plc, Mr.Akin Ogunbiyi, insuranceshould be the backbone of anynational economy. “Insuranceis a medium, where you canput funds together and makeit available for long-terminvestment in other sectors.But unfortunately, the way weare doing insurance inNigeria today is like a non-starter,” Ogunbiyi said.

Need for public awarenessThe recent flooding, no doubt

has brought to the fore the lackof insurance awareness on thepart of majority of the public.It is in this light thatstakeholders have called formore drastic measures todrum up the importance ofinsurance to the generalpublic.

According to the President ofthe Chartered InsuranceInstitute of Nigeria, CIIN, Dr.Wole Adetimehin, insuranceoperators should drum theneed for insurance because ofthe huge effect of the floodwhich has destroyed lives andproperty in many states.

Adetimehin said “In manyways insurance remains anessential index formeasurement of nationaldevelopment although lackingin its expected degree ofpresence in both individualand national consciousness,especially in developingcountries like Nigeria.”

Salvagingflooddisasterswithoutinsurance

“Recent flooding of parts ofNigeria and cases of relatedenvironmental hazards makeinsurance the way to go forNigerians. The insurancesub-sector must seize this asthe needed opportunity todrive home its age-longmessage,” he said.

For Ogunbiyi, there was noreason insurance should notbe the biggest of the sectorsin the economy, if only about25 per cent of its potential inthe country was utilised.

“If you look at what ishappening in developedeconomies of the world,insurance is a basic point ofmaking value, alleviatingpoverty and empoweringpeople in terms of what theyuse the pool of resources that

insurance products from thepublic.

“If the industries rather thanincreasing in number or

payment of premiums whichcharacterises its insuranceoperations over the years.

Osijo said that government,which represented thelargest chunk ofinsurance consumer,needed an acceptableinsurance road mapto maximize itsinsurances andm i n i m i z ewastages.According to her,

payment ofinsurance premiums

by clients was aprecondition for any

insurance contract inline with Section

50(1) of the2003 InsuranceAct, failurew h i c hi n s u r a n c ec o m p a n i e swould not beable to payclaims when aloss occurs.”

In order todevelop itsi n s u r a n c emanpower, theNCRIB bosssaid that

government must constantlyupscale the skills of itsinsurance desk officers toapprise them with thechanging dynamics ofinsurance practice, addingthat only professionallyqualified insurance personnelshould be recruitedhenceforth to man suchinsurance departments orunits.

The way forwardThe federal government,

since the administration ofPresident Goodluck Jonathancame into force, has beenharping on economic growthas well as being the 20th besteconomy by year 2020,however, experts are of theopinion that thefundamentals that will propelsuch growth are still lacking.

Adetimehin said, “It iscommon knowledge that tilltoday the battle to build astable power supply has notfound a solution. There is noway any economy or industrywill grow when you don’thave stable power supply.Look at the level of fraud andcorruption in the country. Itis like governance is now theprimary business because ina way they have killed allsectors, leaving governanceas the only thriving thing. Ithas become a do or die affairwhere everybody wants toplay.”

According to Adetimehin,government have to addressbasic fundamental issuesaffecting the environment inits entirety because it will bedifficult for any sector of thenational economy toexperience any growth whenthe basic infrastructure are notreceiving due attention yearin and year out.

they get to do. If you look atthe housing sector indeveloped economies,virtually in more than 90 percent, you will find that it isinsurance funds that arebeing used to compensatevictims”

The role of governmentThe escalating poverty level

in the country is a major factorhampering growth andacceptance of insurance bymajority of the public.According to experts, if theeconomy should continue inthe snail-like pace as it standspresently, the target of thegovernment in achieving itsvision 20 20:20 target will bea mirage. Consequently, thegovernment has a huge roleto play in the drive towardsmaking the public embraceinsurance.

According to Adetimehin,when the level of disposableincome is nothing to writehome about there won’t beincreased demand for

expanding by the day areshrinking and laying offpeople, how do you expect theinsurance sector to grow.When the level of disposableincome is nothing to writehome about, where do youexpect to find the demand forinsurance products? It is hightime the government begin toaddress all thesefundamentals with all theseriousness it deserves ifanything like the vision20:2020 will be achieved orcrystallised,” Adetimehin said.

Another way the governmentcan contribute to the growth ofinsurance is by promptlypaying premiums for all itsinsurances.

According to the president ofthe Nigerian Council ofRegistered Insurance Brokers,NCRIB, Mrs. Laide Osijo,government must see to it thatinsurance premiums areincluded in yearly budgets ofits institutions in order toreduce the incidence of non-

Fashola urgestraders to gofor insurancecover

By MIKE EFFIONG

Governor BabatundeFashola has called ontraders operating in

different parts of the state togo for insurance cover.

The Lagos state Governormade the statement whilereacting to last Saturday fireincident at the popular Euro-Asia market, Balogun in LagosIsland.

Governor Fasholasympathised with the traders,noting that the incident wasavoidable. “I am sorry aboutthis but the reality is that thiswas a fire disaster that couldhave been avoided judging byreport we got from fire servicewhich came into rescuesituation, you have tounderstand that in life,accidents do happen and someof the accidents are caused bywhat we ourselves do.”

The Governor charged thetraders on the need to haveinsurance policy, saying thatsuch risks can be managedwhen such business hasinsurance cover.

Some of the traders, whospoke on the possible cause ofthe inferno, said that it mayhave been caused by a sparkfrom electrical wires in thebuilding.

According to Mr. IfeanyiOkonkwo, the fire started atabout 5.00pm, when traderswere closing for market addingthat it was by divineintervention that occupants ofthe building which housedabout 600 shops includingUnited Bank for Africa (UBA)survived the disaster. Thefourth and fifth floors of theplaza were completely razedwith no fewer than 20 shopsaffected.

Goods estimated at over N1.2billion were destroyed by thefire and a popular tradernamed Chairman who dealson bags said he lost about N15milion to the inferno, addingthat the disaster was a majorsetback to him and othertraders who had stocked uptheir shops ahead of Muslimholidays and forthcomingfestive season.

The traders appealed toGovernor Fashola to come totheir assistance since theyhave lost all life investment. Inresponse, the Governor statedthat the government will seewhat kind of assistance torender.

,

,“It is common knowledge that

till today the battle to build astable power supply has notfound a solution. There is noway any economy or industrywill grow when you don’t havestable power supply

Eddie Efekoha, MD,Consolidated Hallmark

32— Vanguard, MONDAY, NOVEMBER 5, 2012

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1 / 2PAGE

Vanguard, MONDAY, NOVEMBER 5, 2012 — 33

Appointments & Promotions

BRIEFS

vicahiyoung@yahoo.com 08033348923

CHIEF ExecutiveOfficer of theFinancial Reporting

Council of Nigeria, FederalMinistry of Trade andInvestment, Mr. JimOsayande Obazee, has beenelected as the Chairman of the29

th session of the United

Nations Conference on Tradeand Development, UNCTAD,intergovernmental workinggroup of experts onInternational Standards ofAccounting and Reporting,ISAR.

Elected unanimously, this isthe first time a Nigerian willbe elected chairman of thegroup of experts on thissubject for the UnitedNations.

UNCTAD-ISAR is aspecialised intergovernmentalforum based on consensusbuilding and voluntarycooperation amongparticipating countries.

Every year, UNCTAD hoststhe group of experts from over50 countries on topical globalagenda on financial reportingand corporate governance andother issues of commonconcern to member-statesbesides informal exchange ofexperiences and bestpractices.

Within the year, they alsohost sessions on issues ofurgent global importance thatbear upon institutional reformsand financial reporting.

The group held its 29th

session in Geneva,Switzerland, from October 31

Obazee emerges UNCTA-ISAR Chairman– November 2, 2012, whereObazee was elected.

The main agenda for the29

th session dealt with

Regulatory and InstitutionalFoundations for high qualitycorporate reporting.

It also reviewed the recentdevelopment in the area ofcorporate reporting anddiscussed the result of the pilottests of the UNCTAD-ISAR’sAccounting DevelopmentToolkits for assessingcountries’ capacity-buildingneeds.

Obazee will chair theactivities of this group ofexperts for the next UNCTAD-ISAR calendar year.

Established in 1964,UNCTAD promotes thed e v e l o p m e n t - f r i e n d l yintegration of developingcountries into the worldeconomy.

UNCTAD has progressivelyevolved into an authoritativeknowledge-based institutionwhose work aims to helpshape current policy debatesand thinking on development,with a particular focus onensuring that domesticpolicies and internationalaction are mutuallysupportive in bringing aboutsustainable development.

•Jim Obazee

A Nigerian, Mrs.Olufolake Oshin, has

been elected vice-presidentof the Commonwealth andMagistrate JudgesAssociation, CMJA.

Mrs Oshin, ChiefMagistrate and a DeputyChief Registrar (Legal) in theLagos State Judiciary, waselected vice-president at theassociation’s triennialconference of the CMJA heldin Kampala, Uganda.

An amiable diligent andknowledgeable magistratewith good comportment andintellectual bent, is the firstNigerian and femaleNigerian to take up theposition.

The new vice-president hasbeen a council member andresource person of theassociation in the last coupleof years before her recentelection.

Oshin now VPof thecommonwealthmagistratejudgesassociation

ETISALAT Nigeriahas won brand

excellence award inTelecoms at the secondannual MarketingWorld Awards for 2012.

The award is designedto promoteo r g a n i s a t i o n a lexcellence in brandingand marketingcommunications inNigeria.

Speaking at the awardceremony, Director,Brands andC o m m u n i c a t i o n ,Etisalat Nigeria, Mr.

Etisalat bags brand excellence awards

Enitan Denloye, said theaward was anacknowledgement of thecompany ’s strides in thetelecommunications industryin the country.

According to him, “AsNigeria’s fastest growingtelecoms company, we aredistinguished primarily by ourrange of innovative productsand value added services thatare tailor-made for ourcustomers and generallyimpact positively on the livesof Nigerians. We thrive onexcellence and this echoes inall of our offerings,partnerships andsponsorships.”

Group Publisher ofMarketing World magazine,organisers of the award, Mr.Akin Naphtal, congratulatedthe company, saying “theaward celebrates thecompany’s distinctiveness inthe telecomms sector as wellas overall contribution to thecountry ’s economy.Marketing World Award aimsto highlight brands thatdeliver a full spectrum ofmaintaining the higheststandard of quality,exemplifying creativeness,developing a corporate cultureand providing positive benefitsthat exceed customers' andstakeholders’ expectations.”

The award organised in threecategories included;Organisation Awards, Awardfor Brand Excellence, andIndividual Awardshighlighting the importance ofeach key player in themarketing arena in Nigeria.Up to 25 winning brands wererecognised and awardedprizes, plaques andcertificates. The MarketingWorld award also boasts ofjudging panels consisting oftop-level industry,professionals specific to thebrand, marketing andcommunication industry.

THE Natio-nal Directorate of Employment,NDE,

has capacity building for womenwilling to participatein the 2

ndphase of this year’s

YouWin programme.President Goodluck

Jonathan had, on September3

rd, launched the second

phase of the programmewhich he said, was only de-signed for women in the coun-try.

To enable theeffectively par-ticipate in programme, re-source persons were engagedby the organization to teachthe would-be participants forfive days, on how to go abouttheir quests to benefit from theprogramme.

The Small Scale Enter-prises Depaof the NDE,which carried out the respon-sibility, said the programmewas meant to expose thewomen not only to the process of identifying

NDE prepares women for2nd phase of YouWin grant

and developing a viable business ideabut preparthemtowards business plans wellas other sources of busi-ness financing.

At the end of the training, all the participants ubmit their project to the YouWin website.

Speaking during the event in Abuja, the Direc-tor General of the NDE, Mallam Abubakar Mohammed unemploy-ment a scourge which noted, threaten the aspira-tions of youths.

While challenging thewomen to see the opportunityof rediscovering themselvesfor the financial upliftment ofthe family, he said the train-ing was to avail Niwomenin , the opportunity to dis-cover, sharpen subse-quently implement their entrpreneurial ideas through winning the YouWin grant.

*Mr. Steven Evans

UNITY Bank Plc is

offering customers andthe general public the fullrange of its services at the 2012Lagos International Trade Fair,which opened at the TafawaBalewa Square in Lagos at theweekend.

The bank said in a statementthat its stand at the fair was fullystaffed and equipped to attendto customers' needs andenquiries.

The complement of productsand services available at theUnity Bank trade fair standinclude consumer productssuch as current accounts,savings account, fixed depositaccount, target saving account,local currency and dollardenominated cards as well asagricultural finance accounts.

Existing customers can accesstheir accounts to withdraw ordeposit funds at the fair as thestand is hooked with the bank'scommunication network. This isa great offering to exhibitorsand visitors at the fair as thebank has deployed ATM tofacilitate quick access to cashwithdrawals during the fair.

Prospective customers are notleft out as the bank hasdeployed customer service staffto give them information tohelp them open variousaccounts and how to enjoy thebank's financial services.Account opened at the fair willsubsequently be domiciled inbranches most convenient to thenew customer.

AFTER debating on the2012 subsidy budget and

the in-depth analysis of thefund, the House ofRepresentatives Committee onPetroleum Resources has putthe blame on Subsidy Re-investment and EmpowermentProgrammeSURE-P committeefor being responsible forNigeria’s woes, saying thatthey have not engaged inprojects that will develop thenation.

The lawmakers also chargedthe committee handling SURE-P, to assess the level ofimplementation of subsidyfund to ensure that theresources are used in a way thatwill benefit the masses.

The Chairman of thecommittee, Mr. DakukuPeterside spoke during anoversight visit to SURE-P officein Abuja.

Peterside told SURE-P officeto always seek people’sconsent before embarking onany project so that they wouldbe able to benefit maximallyfrom government, while theysee such project as their own.

SURE: NASSblames committeefor inefficiency

Unity Bank wooscustomers atLagos Trade Fair

34 — Vanguard, MONDAY, NOVEMBER 5, 2012

Aviation

Managing Director,Arik Air, Mr ChrisNdulue has re-

vealed that the airline is thefirst commercial airline inover 20 years to operate abrand new aircraft in Nige-ria. Mr Ndulue made this rev-elation during the 6

th anni-

versary celebration of the air-line at its corporate headquar-ters in Lagos.

The celebration which hadin attendance the Chairmanof the airline, Sir JosephArumemi-Ikhide , CaptainAdo Sanusi, Vice President,Operations, Engr EmmanuelUsifo, Director of Airwor-thines/Standards, NigeriaCivil Aviation Authority,NCAA, Engr Biyi Sangowa-wa, Director,Aik Air, Mr, Alt-fried Nessel, Chief Commer-cial Officer, Lufthansa Tech-nik Maintenance Internation-al, Sen. Aniete Okon, ViceChairman and the Senior VicePresident ,Operations, Mr.Ro Thomas , witnessed thecutting of the sixth anniver-sary cake.

Addressing aviation report-ers, Mr Ndulue said the air-line which started operationon October 30, 2006, with fourdaily flights between Lagosand Abuja, using three brand

We are first to operate brand newaircraft in Nigeria—Ndulue

By LAWANI MIKAIRU

new Bombardier CRJ900 air-craft and carried only 29, 363passengers by year end, rep-resenting less than one percent of domestic flight ,hassince grown to become the air-line with the largest fleet inNigeria with 23 short, medi-um and long range aircraftand has the youngest fleet inAfrica with an average age ofless than 5 years. The airlinehas carried over 10.2 millionpassengers in six years of op-eration and now controls over65 per cent of the total domes-tic market share. It does about120 daily flights from its twohubs in Lagos and Abuja andserves 22 destinations acrossNigeria. It has five routes inWest Africa, viz Accra, Mon-rovia, Freetown, Banjul, andDakar. Two in Central Africa:Angola, Douala,one route inSouth Africa ,Johannesburg. Italso flies to London Heathrowand J.F. Kennedy Airport inNew York, America . Arik Airservices 42 routes across theworld.

The Managing Director fur-ther said the airline has Invest-

ed $2 million dollars on cadetpilots training and has creat-ed over 2500 direct jobs forNigerians .It has full activemembership of IATA. Mr Ndu-lue revealed that the airlineplans to expand its Africandestinations to include Abid-jan in Cote d’Ivoire, Conakry,Guinea, Kinshasa,Congo,

Malabo, Equatorial Guinea,and Libreville in Gabon. It willalso expand long-haul desti-nations from Lagos to Hous-ton ,USA, Abuja-Kano-Jeddah,Saudi Arabia, Accra-London,Freetown-London.

The airline also plan to ex-pand its interlining and codeshare arrangements to devel-

op services to points beyondEurope, Middle East & USA.It is launching new mainte-nance hangar and Mainte-nance, Repair and Overhaul(MRO) facility in partnershipwith Lufthansa Technik. Anew Super Hangar for widebodied aircraft and Arik Avi-ation Academy in Benin.

Managing Director ofthe Nigerian Airspace

Management Agency(NAMA), Engineer NnamdiUdoh last week said the in-troduction of the e-flight plan-ning would help airlines toreduce flight delays and can-cellation across all the airports

e-flight planning will eradicate delays andcancellation of flights, says Udoh

By DANIEL ETEGHEin the country.

Speaking during a one daytraining programme for air-lines in the country as part ofits strategy in reducing flightdelays at the nation’s airports,Engineer Udoh pointed outthat the training was meant toeducate airline operators onthe need to imbibe e-flightplanning to reduce flight de-lays and improve services to

their numerous customers.According to him, the e-

flight planning was the cen-tral focus of the transformationfrom Aeronautical InformationService (AIS) to AeronauticalInformation Management(AIM).

Engineer Udoh further de-scribed the training exerciseas timely considering the on-going automation project ofthe AIS.

1 / 2PAGE

Vanguard, MONDAY, NOVEMBER 5, 2012 — 35

Agric

BRIEFSDr. Abubakar Lawali, a

Plant Breeder is with the De-partment of Crop Science ofFaculty of Agriculture, Us-manu Danfodiyo University,UDU, Sokoto. In this inter-view with Abdallah el-Kurebe, he spoke on plantgenetics and the place of bio-technology in the provision offood security.

Excerpts:For a Nigerian traditional

farmer, how would you de-scribe plant genetics?

Plant genetics is used in ag-riculture to develop new andmodern improved varietiesthrough plant breeding. Thevarieties could be for highyield, improved mineral andvitamin content, early matur-ing, etc.

How would you relate thepolitical will of Nigerianleadership to the agricultur-al needs of the nation?

One can conveniently saythat it is not there. However,let us wait and see, perhapswith all promises made, some-thing may come out of it.

Recently, the Global FoodSecurity Index of the Econo-mist Intelligence unit rankedNigeria 80th among 105 oth-er countries on food insecu-rity. What do you see as thereason for this ugly develop-ment?

It is quite unfortunate butthe reasons that Nigeria islagging behind in the provi-sion of food security for thecitizenry include inadequatefunding and infrastructure forresearch; lack of adequatelink betweenresearch and development;funding of development,where available, is not realis-tic or has been politicized andas such, does not reach thetarget farmers.

Do you see the current Ni-geria’s Agricultural policy astruly addressing the problemof food crisis in the country?

Theoretically it can, but ithas always been the problemof implementation. You cannottransform Agriculture whenthe infrastructure is not there;you cannot supply inputsthrough cell phones in acountry where there is nopower and literacy level islow.

What do you see could bethe role of Agricultural Bio-technology in improvingfood production in Nigeriaand by extension, Africancontinent?

Agricultural Biotechnologycan lead to a quantum leapin food production if utilizedeffectively and efficiently.However, bio-safety regula-tions must be respected.

Biosciences for Farming inAfrica, B4FA has come intothe continent with a view tocreating awareness on theneed for governments andfarmers here to wholly adoptbiotechnology in order to in-crease food production tomeet up with the over-grow-ing population. As a plantbreeder, how would you ad-vise the FG on this?

Government can adopt bio-technology. There is no prob-lem with that but we must, first

Agricultural Biotechnology canlead to quantum leap in foodproduction —Dr. Abubakar Lawali

of all, place all the bio-safetyregulations in place.

Ways for improving foodproduction are by genetical-ly modifying plants as wellas genetically engineeringcrops such that would be re-sistant to deterring factorslike pests and other plantdiseases. According to your

research and findings, howmuch of these are Nigerianfarmers using?

There is practically none asof now; perhaps in the nearfuture.

If, according to your re-search findings, no Nigeri-an farmer on the average isusing genetically modifiedplants and genetically engi-neered crops, how do westart as a country?

Well you see the way to starteven in the countries thathave started; the first thingis to put in place, the bio-safety regulations like Isaid earlier. What are bio-safety regulations? These areregulations toensure that there are no un-warranted or unwantedtransfers of geneticmaterials to sources that theyare not designed for. If thistakes place, then it may lead

to the creation or develop-ment of very terrible and haz-ardous threat to the environ-ment. And that is why beforeyou start; make sure that thebio-safety regulations are be-ing observed. To my knowl-edge, the bio-safety law hasbeen passed by the NationalAssembly but not sure if it has

been assented to by Mr.President. Even if it has beenassented to, what have weput in place to ensure thatthese things are working? Ifwe don’t ensure that theyare working and we just kick-start the project, I assure youthat we will be in more trou-ble than we expect.

You have consistently men-tioned the observance of bio-safety regulations as a pre-condition for Nigeria’s adop-tion of Agricultural Biotech-nology. Specifically, which ofthese regulation are you re-ferring to

These are regulations as tohow and where you practice;how the laboratories will func-tion and even the farmers aregoing to control, pollingtransfer and so on. So, thesethings have to be workedupon by a national committeeof experts. We have teeming

professors out there thatcould help in this regard.What remains is for the gov-ernment to present this doc-ument for the experts to dosome work on itsworkability.

How would you assess gov-ernment’s support for re-search and development, es-pecially in the area of agri-cultural biotechnology andthe application of such re-search results for nationaldevelopment?

The basic infrastructure forbiotechnology is lacking inthe country as well as train-ing and retraining. More so,funding for biotechnologyresearch is lacking. We alsoneed to prioritize and focuson certain key crops that willimmediately solve the prob-lem of food insecurity and foreconomic empowerment inorder to reduce poverty; pro-vide jobs through value ad-dition to our crops, which inturn will attract internationalmarket.

You said there is inade-quate link between researchand development. Can youexplain this?

When you go to the univer-sities and check the shelvesof the professors and otherresearchers in the universi-ties, there are a lot of re-searches lying with piles ofdust. In advanced countries,commercial people and thosein the private sector go to theuniversities, get the research-es and mass-produce them.

That is the name; you re-search and develop them.This is the link between re-search and development. Inour country, the private sec-tor is not so organised to dothat as an economic activity.

,

,

Agricultural Biotechnologycan lead to a quantum leapin food production if utilizedeffectively and efficiently.However, bio-safetyregulations must berespected

Dr. Abubakar Lawali

Godrejexpandsproductsportfolio withnew brands

Godrej Nigeria Limitedhas expanded its prod-

ucts portfolio with the launchof new brands into the mar-ket.

The company’s MarketingManager, Mr. Mike Ogor,who disclosed this said thatin addition to their flagshipbrand, Tura Medicated Soap,they have introduced newproducts into the domesticmarket.

“The new products areGood Knight Insecticide andBio Oil,” he said.

He stated that the new prod-ucts were introduced to fill agap the consumers lack inpresently available products.

According to him, whileGood Knight Insecticidewhich comes in Aerosol andmosquito coils protects con-sumers against mosquitobites, Bio Oil is specially for-mulated to solve skin care is-sues of scars, stretch marks,uneven skin tone, ageingskin and dehydrated skin.”

He further stated that whilesome competitors’ Aerosolsleave some irritating effectsafter use, the Good Insecti-cide is friendly on humans;its unique formula and de-odorizing properties create apleasant experience, savingthe consumer of irritation af-ter use.

Lucky Fibres un-veil new promofor Nobel carpets

BY TOHEEB IDRIS

Lucky Fibres Plc has introduced a new consumers’

promotion tagged the “Nobelcarpet guaranteed win-winbonanza.”

Mr. Hamant Nahar, saidthat the promotion which hasstarted running since October24 and will end December 24,2012, is to appreciate and re-ward the company’s esteemedcustomers for their patronageand loyalty to the brand.

Nahar added that the pro-mo is taking place in 19 citiesacross the country includingLagos, Abuja, Akure, Ibadan,Kano, Kaduna, Port Harcourt,Benin, Jos and Onitsha.

Mr. Nahar said the compa-ny has invested several mil-lions of dollars in technologyand capacity building of itshuman resources to deliverworld class product to them.

Nahar stressed further thatwith the acquisition and in-stallation of the new CPR 92weaving machine from Bel-gium which is the first and thebest in sub Sahara Africa.

36 — Vanguard, MONDAY, NOVEMBER 5, 2012

ICT

BRIEF

LG goes hi-tech in newair conditioners

For many manufacturers of Airconditionersin Nigeria, lack of

skilled local based personneland unstable power supplyare the bane of growth of thesector. However, LG Electron-ics appears to have crossedthat huddle with the introduc-tion of what it called superi-or and high technological ap-plications in the manufactureof its latest series of aircon-ditioners.

First, a few months ago, itintroduced into the Nigerianmarket its Multi V III com-mercial Airconditioner - acommercial AC which it saidhad been proven to have threeunique benefits, includinghigher energy efficiency, big-ger capacity, and longer pip-ing design for teeming Nige-rian customers who wouldcome in contact with theproduct.

The company on introduc-tion of the product, said thatthe unit’s increased energyefficiency which receives aboost by inverter compressorV-Scroll and High PressureOil Return, HiPOR technol-ogy, delivers a coefficient ofperformance, COP level of4.6, making it one of the high-est in the industry. This iseven when it is touted to re-duce oil circulation from theconventional 2.5 to 0.35, mak-ing it consume less energythan its competitors.

However, last week, thecompany showed that it wasnot done with using new tech-nologies to strengthen its

L-R: Tolulope Lawani, HP Marketing Manager, Printing and Personal Systems West Africa;Rita Amuchienwa, Channel Development Manager HP Imaging and Printing Group, EnglishAfrica and Janet Thiong’o HP IWS Product Manager, West, East and Southern Africa, Print-ing and Personal Systems Group displaying one of the HP Deskjet Ink Advantage printerslaunched recently in Lagos.

BY PRINCE OSUAGWU

KITSTechnologies toreduce datacentre outageswith training

GABRIEL AMADIEGWU

operations as it introducedanother version of the Multi-V III air conditioner.

Tagged LG Multi-V IIISolo, the company said thecommercial Air conditioner isthe newest heating, ventila-tion and Air Conditioning,

HVAC solution and an evi-dence of its drive to alwaysbe ahead in innovation.

Combining this innovationwith higher efficiency, theMulti V III Solo delivers fastresponse cooling and space-saving smaller footprint. Ex-

pectedly, this cutting-edge at-tribute would make it gain sig-nificant market share in Nige-ria and Africa as a whole.

The Multi V III Solo also hasthree unique benefits of high-er energy efficiency, eco-friendly and longer pipingdesign for consumers, just likethe last variant. The AC unit’sincreased energy efficiency isalso boosted by LG’s DC in-verter compressor technologywhich traditionally, delivers aCOP level of 3.5. With a totalpiping length up to 150 m anda level difference of 50m be-tween Outdoor unit, ODU,and In door unit, IDU.

LG said that the Solo brandprovides optimum solution forsmall/medium-sized buildingand can be connected to over25 indoor units in any build-ing.

Describing the power of tech-nology behind the productionof the product, General Man-ager, Air conditioning andEnergy Solution division atLG Electronics West AfricaOperations, Mr. JunhwaJeong, said that “as a compa-ny with a great focus on pro-ducing energy-saving and ef-ficient products, we are hap-py to introduce the Multi V IIISolo into the Nigerian market.With this product in the mar-ket, we are in a better posi-tion to work with our dealersand business partners to keepLG in the lead as the No. 1provider of smart and efficientHVAC solutions,” he added.

Data centre infrastructure services provider,

KITS Technologies Limitedis set to hold a week longtraining for data centre op-erators, managers, consult-ants and IT / network man-agers involved in the de-sign, specification and op-eration of data centers’ andcomputer rooms.

The company said thetraining would help to re-duce data centre outagesand its causes to improvedata centre efficiency

It will also put practitio-ners in-tune with the latestin data centre operationand management standardscovering design standards,energy efficient cooling,needed power requirement,strict compliance to Tierstandards, correct opera-tional procedures, capacitymanagement, green agen-da metrics and many more.

The company also plans tohold a one day free trainingfor all on November 12 be-fore the week long formaltraining which commencesfrom November 13 to 17,2012 at Protea Hotel, Ike-ja.

Speaking at a press con-ference to announce thistraining, Director Businessand Strategy at KITSTechnologies, TaofeekOkoya, said that one keything that will shape ITand drive businesses inNigeria is data centre asit remains a key businessenabler to grow majorbusinesses in comingyears.

He noted that data cen-tre will rank among the top10 paid jobs come 2013as mobile operators in thecountry have huge capac-ities to drive this, addingthat there was need forcompanies to buy into it.

In continuation of her10 years efforts towardsbuilding a strong humancapacity in the data centreIndustry in Nigeria isdeeply involved in a com-plete range of data centreinfrastructural services inconsultancy, designs, im-plementation and auditing.

Airtel blames poor network serviceon terror attacks, flooding

BY PEACE ONYEUKWU

Airtel Nigeria has attributed flooding and at-

tacks on its installations to thepoor network services expe-rienced recently. It said at-tacks on its 53 installationshave disrupted operations in193 sites across the Northernpart of Nigeria.

This is also as the operatortasked the National Emergen-cy Management Agency,NEMA, to make the restora-tion of telecoms facilities inflooded areas an importantfocus of its rescue efforts.

Airtel Nigeria’s Director ofRegulatory Affairs and Spe-cial Projects, Mr OsonduNwokoro, at a press briefing,weekend said that these di-sasters have resulted in theloss of telecommunication

equipments, spiralling cost ofmaintenance in affected loca-tions to thrice the normal rate,consequently leading to co-lossal financial losses and dip-ping revenues.

According to Osondu, thedevastating impact of theflooding in the Middle-Belt,South and Delta states hasaffected 32 installations andimpacted on the overall oper-ations of 41 sites across theregion. He also said that theroutine preventive 24 hoursmaintenance of its facilities inAdamawa, Gombe, Kano, Bau-chi, Borno, Yobe and Kadunastates was stalled as a resultof armed insurgency in partsof the North.

He also hinted that theflooding in Lokoja, Asaba,,Ugheli-Patani and Patani-Elele also caused damages oninstallations and loss of sites

and fibre capacities.He however revealed that in

other to forestall future poorservices, Airtel has taken de-cisive steps to mitigate thedamage done to its facilitiesby sealing facility-sharingagreements with other oper-ators as well as collaboratingwith security agencies to en-sure maximum protection oftelecom facilities across thecountry.

He called for expanded col-laboration between the gov-ernment and telecoms opera-tors to tackle the persistingsecurity threat to telecom in-stallations and further empha-sized the need for the Nation-al Emergency ManagementAgency (NEMA) to make therestoration of telecoms facili-ties in flooded areas an im-portant focus of its rescue ef-forts.

Business & Economy

Vanguard, MONDAY, NOVEMBER 5, 2012 — 37

BUDGET 2013: All talk;no jobs — 1

“We have mentioned the 3.5million jobs we aim to createin agriculture and millions(?)more in housing, and con-struction sectors, solid miner-als sector, aviation and thecreative industry”. PresidentGoodluck Jonathan, 2013 Bud-get Speech, delivered to theNational Assembly.

“We must thank God for evilpeople, for the evil they mighthave done but failed to do”,according to a Methodist cler-gy man in Melrose, Massa-chusetts, USA in 1966.

The 2013 budget, hastily prepared, like theSURE-P document,

proudly presented by DrNgozi Okonjo-Iweala, to bam-boozle us into accepting therewas a real subsidy to remove,is headed for the same grave-yard as well. To be candid andstraight to the point, the bud-get, handed to the Presidentdoes no credit to anyone as-sociated with its preparation.At least, we can thank the Al-mighty that the government isnot claiming much by way ofachievements. For a govern-ment characterized by dissem-bling officials, this is a stepin the right direction. Wemight eventually get to thepoint when we are fed onlywith half-truths instead of out-right lies – like subsidy.

The most important parts ofthe 2013 budget were, to me,security and job creation. Pow-er and petroleum continue tobe messed up. About the timethe President was deliveringhis budget, bids for the priva-tization of Power Holding Cor-poration of Nigeria, PHCN (orpalaver has changed name),were being opened. Amongthe winners was a namewhich had been mentioned injust about every fraud or cor-rupt practice in Nigeria in thelast few years. Then, it turnedout that the bidding processwas as crooked as a bent nail;at least if state governors areto be believed. So, expectnothing, nothing good, that

is, from that sector next year.The report for the power sec-tor this year is a joke – a badjoke from the Ministers in thatvital sector. Read some ofwhat the President said aboutPHCN’s performance for2012 and what to expect nextyear and despair.

“The power sector is oncourse” (Section 17 of budgetaddress). Of recent, our ef-forts have paid-off as we havesignificantly improved pow-er supply averaging about 15hours per day”. Self-delusioncannot be more boldly writ-ten than that. Incidentally, “oncourse” might mean like theDana flight from Abuja. ThePresident might receive I5hours of power supply in AsoRock, which at any rate hasits own Independent PowerPlant, IPP, but only the Pres-ident of another country, notNigeria, can boast of 15 hourspower supply to his peopledaily. And just to show thatthe Commander-In-Chief, C-I-C) of the Armed Forces(armed with what; we won-der), was handed, a report,not worth the paper on whichit was written, by the Minis-try of Power, nowhere in sec-tions 17 and 18, which weredevoted to power, would yoube able to find a declarationon how many kilowatts ofpower per day was deliveredto “Fellow Nigerians” to sup-port the 15 hours per dayclaim. The reasons are not toodifficult to discover.

In 2011, PresidentJonathan’s governmentpromised to attain 5,000MWpower supply by December31 of that year. The promisewas repeated several times by

former Minister of Power, Pro-fessor Barth Nnaji. Well, maybe because the Professor, whois also the largest sharehold-er in a private power compa-ny, which failed in its bid tograb one of our stations, wastoo busy preparing the biddocuments, the year 2011 end-ed without the 5,000MW mile-stone being reached. Un-daunted by failure, as the lostsoul who said “having lost ourway, we redoubled our ef-forts”, Professor Nnaji againpromised 6,000MW by the endof 2012. Well, he, justly, gotthe boot three months ago. Butas this article is being written,a crazy generator is making aracket in my backyard – a mon-ument to the battle of6,000MW lost in 2012. So, thePresident deliberately side-stepped the main issue aboutpower supply, namely, howmany megawatts can we ex-pect in 2013? There is noth-ing more to say about that gap-ing hole in our informationnetwork. Blessed are they thatexpect nothing from PHCN(palaver has changed name),for they shall never be disap-

pointed. The crazy gen-sethas proved more reliablethan the Federal governmentof Nigeria. Mine and others’will surely see us throughanother year.

“The petroleum sector con-tinues to play a crucial rolein our economy”, announcedthe President in section 25 ofthe budget. Even the villageidiot knows that. What themoron does not know is whatthe President has failed tosay – the petroleum sector istotally, and, perhaps irre-deemably corrupt, as long asthe cozy relationship betweenthe swindlers and top gov-ernment officials continue.

Incidentally, after number-ing up to section 18, the bud-get document stopped num-bering and resumed at sec-tion 24, where, under theheading Aviation and Air-ports, Jonathan said, “Weknow that Nigerians are dis-turbed about the condition ofour roads”. If there is anaward for understatement ofthe Year 2012, GEJ shouldstep up and receive it. Takeany public transport going

through Ore-Benin, Warri-Patani-Yenagoa; Portharcourt-Aba-Enugu roads, amongothers, and what the adven-turer, (it is a dangerous ad-venture to travel Nigerianroads), would discover arenot disturbed Nigerians, butpeople raining curses andmaledictions on those in gov-ernment. Nigerians are lividwith rage. It was that way in1999 and it is worse in 2012.

I sent a letter to Mrs Ali-son-Madueke, when she wasappointed Minister of Trans-port and she visited Ore-Be-nin expressway to shed croc-odile tears. In it 50 most im-portant roads needing atten-tion were listed; a SUNDAYVANGUARD column was de-voted to the same issue.Nothing happened. Again in2010, the same message wassent to Acting PresidentJonathan. For all that it mat-ters to both of them, I mightas well have been talking towalls. For 14 years, Nigeri-ans have been treated to thesame empty promises onroads.

Petroleum Ministry is aden of robbers; where morerobbery is being discoveredevery month. Mallam NuhuRibadu, surely, everybodyremembers him, in a newspa-per report on October 25,2012, announced that $183million is missing from thesignature bonuses account,in a country laboring underthe illusion of becoming top20 in 2020. If $183 millionwas discovered missing inany account of the USA, Chi-na, Japan or Germany (num-bers 1, 2, 3 and 4 economiesworldwide), a Minister wouldbe on his way home or jail.Well, the Honourable Minis-ter for Petroleum, from whoseMinistry the alleged theftoccurred, was not even awarewe have been robbed; just asshe was incompetent enoughto call N1.3 trillion a subsidy– instead of fraud.

To be continued….

,

,

At least, we can thank the Almightythat the government is not claimingmuch by way of achievements. For agovernment characterized bydissembling officials, this is a step inthe right direction. We mighteventually get to the point when weare fed only with half-truths insteadof outright lies

The Minister of Trade andInvestment, Dr

Olusegun Aganga, hasreiterated the determinationof the Federal Governmentto revamp them a n u f a c t u r i n g s e c t o r.Aganga, who was speaking atVitafoam’s 50th Anniversary

A Russian firm hasdragged the FederalGovernment to the

International Court ofArbitration, London, over theownership of the AluminumSmelting Company of Nigeria(ALSCON) at Ikot Abasi,Akwa Ibom. UC Rusal, theRussian firm that bid forALSCON under theprivatisation programme, isseeking the court ofarbitration to prevent theFederal Government fromexecuting a Supreme Courtjudgment on the ownershipof the smelting plant.

The apex court had on July7 ruled that BFI Group, the

UC Rusal goes to International court of ArbitrationN i g e r i a n - A m e r i c a nconsortium that emerged thepreferred bidder for ALSCONin 2004, and was disqualifiedin controversialcircumstances by BPE, wasthe valid winner of the bid. Astatement by the RussianAluminum group on Friday,said that UC Rusal remainedthe owner of the smelterplant. The statement signedby UC Rusal’s Head of PublicRelations, Ms ElenaMorenko, said the Russianfirm was prepared to defendits right of ownership of 85per cent stake in the plant.

“RUSAL wishes to confirm

that RUSAL, through itssubsidiary is the legal ownerof ALSCON. RUSAL’s legalownership of the plant’sshares has not been affected

by any litigation. No memberof the RUSAL Group is or hasbeen a respondent in anycase affecting the ownershipof ALSCON. RUSAL is,

however, fully prepared todefend its rights to thesmelter, including in legalproceedings.

Minister reiterates FG’s commitment to revampmanufacturing sector

Gala Night/Award ceremonyon Thursday in Lagos, saidthat the manufacturingindustry was a critical sectorof the economy.

According to the minister,the sector needs to work at itsoptimal level for nationaldevelopment. He said that

the government was focussingon the sector to join theleague of industrialisednations in a short time.

Aganga said that the nationhad the capacity to becomemore vibrant and stronger tocompete favourably with thedeveloped world.

CMYK

38 — Vanguard, MONDAY, NOVEMBER 5, 2012

FPadvert

CMYK

Vanguard, MONDAY, NOVEMBER 5, 2012 — 39

Advertising, Media & Marketing

BRIEFS

The importance of drinkingmilk cannot be over-

looked. Milk consumptionaccording to National DairyCouncil (NDC) contributes toenhanced health and fitness ofhumans.

The dairy market is filled witha wide range of milk brands,with each battling forconsumers’ mindshare. Whilesome may not be available inNigeria, there are quite ahandful of them in the Market.Some of the brands are; Peakmilk, Loya milk, Cowbell milk,Dano, Chi, Hollandia, UHT,Nunu, Coast, Three Crown etc.Others have been silent in thedairy market campaign, exceptfor Hollandia which haspresence in some quarters of themedia.

Averagely, milks have calcium,vitamin D, phosphorous andother blend of nutrients provento build bones, teeth, as well aspromote healthy function ofmuscles and blood vessels,particularly in children. In themidst of all the new vitamins-water, energy drinks, and otherartificially contrived beverages,milk is a natural healthy choice.

Based on these facts,Promasidor Nigeria Limitedmanufacturers of Loya Milk,said its milk contains 50 per centmore calcium than any other inthe dairy market. The brand inits Drink Milk Campaign hasprojected calcium as its UniqueSelling Proposition (USP), andthis, from investigation hasgiven the brand an addedadvantage over competition.Now consumers are beginningto realise the importance ofcalcium in their bones.

The brand which came intoNigeria in 2004, launched anadvertising campaign whichended last year with one keymessage: Loya Premium is abrand of full cream powderedmilk with a new and morecalcium formulation; Hi-Calcium.

At the re-launch of the milk in2010, Mary Jane Umeh,National Secretary of theDietitians Association of Nigeriamade known that “calcium is amajor component of mineralizedtissues that is required fornormal growth and skeletaldevelopment”.

She said “optimal calciumintake is important for everymember of a growing family tomaximize peak adult bone massand its maintenance, tominimize the elderly bone lossand prevent a number ofcommon chronic medicaldisorders in our families inparticular and Nigeria at large”

Speaking further, OnyekachiOnubogu, the MarketingDirector, Promasidor, assertsthat “Calcium is an essentialpart of our everyday life,especially in growing children.

POSITIONING: Loya ignitescompetition in milk market...plays up calcium as USP

We have introduced calcium inLoya milk to demonstrate wecare about our consumerswelfare.

The emphasis on calcium wasdriven by research findingsthat showed that calcium ismost abundant mineral in thebody with over 99 percentstored in the bones and teeth,and the rest of the body’stissues and inter-cellularfluids, he said.

It is also important for nerveimpulse transmission, muscle

contraction, blood clotting,lowering blood pressure, thestimulation of hormonesecretion and the activation ofenzyme reaction.

When asked why the LoyaMilk’s highpoint is on calcium,Keith Richards, ManagingDirector of Promasidor Nig.Limited, said at the event; “Wehave really done our homeworkon the refortified high calciumLoya milk, and this we did inorder to offer the growingNigerian family both youngand young at heart a productthat offers them not only ahealthier diet mix but also topsshelf quality that meets worlds

class standards”However, investigation

carried out by Vanguard todetermine the impact of DrinkMilk campaign and theawareness created so far by thebrand’s projection of calcium asessential to the body showedthat, of the 115 respondentsspoken to, 74 are were awareof the campaign, whilst 65knew of the brand’s calciumfortification play up. Which 27respondents claimed ignoranceof, as 14 of them were unaware

of the campaigns.Two things have kept the

rising profile of Loya milk inthe market. One was the claimby a customer at the recentlyconcluded promo, that the milkhas helped her daughterdevelop a stronger bone, whichhas enabled her to walk. Theother is the price mechanism,A sachet of Loya sells for N30and the Refill Pack sell forbetween N4500 to N500,.Whilst Peak Milk, the leader inthe diary segment sells itssachet for N40 and its refillpack for between N600 to N700

Generally, there are dozentypes of milk. The differences

between them may depend onthe source, fermentationprocess and the likes.

For instance the pasteurizedmilk is heated to a temperaturethat eradicates any dangerousbacteria, but does not affect theflavour of the milk. This kindof milk is for drinking, oncereals and in cooking. Also,unpasteurised milk is alsoknown as raw or untreatedmilk, and it is becomingincreasingly available aspeople acquired a taste foruntreated products.

Nutritionists haverecommended that babies,young children, the elderly,pregnant women and anyonewith an impaired immunesystem should avoid drinkingunpasteurized milk.

Whole milk is the third typeof milk. As the name suggests,it is simply the fresh milk fromthe cow, with nothing added ortaken away, although it isusually pasteurized. Then,semi-skimmed and skimmedmilk are type of milk from whichpart or almost all the fat hasbeen removed. Semi-skimmed(low-fat) milk has a fat contentof 1.5 - 1.8 per cent andskimmed milk has a maximumfat content of 0.3 per centalthough 0.1 per cent is moreusual (source: National DairyCouncil).

Another is homogenizedmilk. When milk ishomogenised, the fat particlesare broken up and dispersedevenly. The cream is blendedinto all of the milk, instead offloating to the surface, which itdoes when it’s left to its owndevices.

,

,

Harp partners18th NSF

Harp Larger, a GuinnessNigeria brand has

entered into partnership withLagos state on the 18

th

National Sports Festival,EKO 2012. The partnershipwas unveiled at the signingof a Memorandum ofUnderstanding (MoU)between Lagos State andGuinness Nigeriaheadquarters in Lagos.

Speaking at the signingceremony, Mr. Seni Adetu,Managing Director/ChiefExecutive Officer, GuinnessNigeria, said the partnershipis one that will fosterfriendship and camaraderiethroughout the games. “Weare delighted to work with theLagos state governmenttowards the upcomingfestival. We all know thatHarp Lager is ’Best Enjoyedwith Friends’ and so for usthis partnership is one thatwill help push that messageto Lagosians and Nigerians.We want to identify with themessage of the festival ‘ignitethe spirit of friendship’ andwe believe Harp is bestplaced to drive that messagehome for us.”

Signing the MoU on behalfof the state government,Chief Molade Okoya-Thomas, Chairman,Marketing and SponsorshipSub-committee, expressedgratitude to GuinnessNigeria for their support tothe Local OrganizingCommittee and the LagosState government.

Shoprite’s CSRprofile rises,touches 30homes

Shoprite has increased

its Corporate SocialResponsibility (CSR) profileby adding Olive BloomOrphanage Ajah, Lagos, asit donates N.2million,touches 30 homes.

Shoprite said its CSRinitiative; Help-Change–A-Life has made donations to30 Non GovernmentalOrganisations (NGOs) ofdifferent valuations inshopping vouchers in the last3 years.

Mrs. Ngozi Ken Udo,Executive Secretary of theOrphanage thankedShoprite for the gesture andfor picking the orphanage asa beneficiary of its gift, whilesaying that the vouchers willbe used to procure groceries,particularly diapers and foodto help keep the children ingood shape.

Nutritionists haverecommended that babies,young children, the elderly,pregnant women and anyonewith an impaired immunesystem should avoid drinkingunpasteurized milk

STORIES BY PRINCEWILL

EKWUJURU

From left: Managing Director, EXP Nigeria, Mr. Wole Olagundoye, Visiting Professor at BrunelUniversity, Prof. Jeff French; EXP Regional Director, West Africa, Mr. Tertius Strauss; ManagingDirector, EXP Social Marketing Foundation, Mr. Richard Burns and the Group Director, EXP,Mr. David Boon all resource fellows at the African Social Marketing Forum held in Abuja.

CMYK

40 — Vanguard, MONDAY, NOVEMBER 5, 2012

CMYK

0817 002 3569

Omoh Gabriel - Group Business EditorBabajide Komolafe - Acting Finance EditorClara Nwachukwu - Energy EditorPeter Egwuatu - Head, Capital MarketYinka Kolawole - Snr Bus. CorrespondentFavour Nnabugwu - Insurance CorrespondentGodwin Oritse - Maritime CorrespondentGodfrey Bivbere - Maritime CorrespondentYemi Adeoye - Capital Market ReporterOscarline Onwuemenyi - Energy CorrespondentFranklin Alli - Industry/Agric. ReporterMichael Eboh - Capital Market ReporterAmaka Abayomi - Money market ReporterEbele Orakpo - Energy ReporterIfeyinwa Obi - Maritime Reporter

CONTRIBUTORSPrincewill Ekwujuru - Media/MarketingNaomi Uzor - IndustryProvidence Obuh - Micro FinanceLAYOUT - Graphics Department

Business Economy

LCCI expects 600,000 visitors at trade fair

The Lagos Chamber ofCommerce and Industry

(LCCI), organiser of theongoing 26th LagosInternational Trade Fair, saidthat over 600, 000 visitorswere expected at the fair. MrDele Alimi, the Director ofMembership and TradePromotion of the LCCI,disclosed this on Friday inLagos.

He said that the chamberanticipated a large turnout ofvisitors because of the locationof the venue. The fair is beingheld at the Tafawa BalewaSquare complex instead ofthe traditional internationaltrade fair site on Lagos-Badagry expressway due toongoing road construction.Alimi said that about 300,000visitors attended the lastedition of the fair which washeld at the international trade

fair site. He said that thevenue of the ongoing fair wasunique and accessible tovisitors.

“ We recorded about300,000 at the end of 2011trade fair and because thisyear’s venue is where peoplecan access easily, we expectthis figure to double,” hesaid. Alimi said that thisfigure excluded those who

would have free access likeexhibitors, their staff andguests who would grace eachspecial day’s occasion. Thedirector said that officials of theLagos State TrafficManagement Authority wouldensure free-flow of traffic,while a close circuit TV hadbeen mounted in strategicplaces.

He said that hawking would

not be allowed within andoutside the venue during thetrade fair. Alimi said that

some aspects of the fair hadbeen insured for five millionnaira. He, however, did notdisclose those aspectscovered by insurance.

A business delegationfrom India will be

showcasing new products atthe Lagos International TradeFair, says the HighCommission of India. TheCommission, in a statementsigned by its First Secretaryof Commercial, Mr Kurma

India indicates interest in Lagostrade fair

Sharma, in Lagos, said anIndia Pavilion of about 150square metres, would beopened at the fair.

The statement said that theTrade Fair, scheduled to holdat the Tafawa Balewa Square,Lagos, will afford thedelegation opportunity todisplay their new products.

“We see increase in oil ref-erence price as a threat be-cause the money will beshared by the three tiers ofgovernment. It will increasespending and inflationaryspending. We think a refer-ence price of $75/barrel isbetter than $78, and $78 isbetter than $80/barrel, butthat is if the difference issaved.”

The above is thestatement of ScotRogers, the Senior

Resident Representative ofIMF in Nigeria, at the recentIMF Sub Saharan RegionalEconomic Outlook for 2013 inAbuja.

The Finance Minister andCoordinating Minister of theEconomy, Dr. Ngozi Okonjo-Iweala, is also reported byReuters News Agency to“strongly believe that $75 isthe right benchmark for us;it will help us to buildbuffers”. Indeed, both CBNGovernor, Lamido Sanusi,and Finance Minister had afew weeks earlier alsoinsisted that a 2013 budgetcrude price benchmark above$75/barrel would ‘hurt’ theeconomy.

In consideration of aboveexpressed concerns, we willbriefly discuss the followingissues; benchmarkdetermination, allegednegative impact of higherprice benchmark, and thetouted benefits of increasingreserves.

President Jonathanindicated a scientificmethodology for forecastinginternational crude pricemovements in the 2013Appropriation Bill. Inreality, even if such a pseudo-scientific model exists, itcannot be a precise science;it would probably be easier tohave predicted theoccurrence of the recent

IMF’s Poisoned Pill

,,hurricane ‘Sandy’ three years

earlier, than to accuratelypredict price movements inthe international oil market. In any event, the failure ofthis model is probablyamplified by the widedisparities between projectedbenchmark prices and actualprices within the three yearsthat Dr. Iweala indicated thatthis model had been adoptedfor Nigeria’s budgetprojections.

Indeed, if crude pricesremained at an average ofabout $100/barrel at a timethat the world economy is in‘bad shape’ as currentlyobserved, it should beexpected that oil prices willrise when the world economybegins to ultimately turnaround, rather than fall.

The argument that freshdiscoveries of oil reserveswould drive down prices isprobably also self-serving andinappropriate, as new oildiscoveries have become anintegral part of the supply

curve for decades and yethave never preventedspiralling prices!

The other question iswhether a higher pricebenchmark would predicateeconomic doom as predictedby the IMF and others. Theanswer is the retrospectiveevidence of a batteredeconomy in the last threeyears, during which budgetbenchmarks wereconservatively calculatedbelow 25% of the actualaverage.

National debt has, in fact,

doubled, and service chargeshave similarly more thandoubled, and is projected toincrease to over N590bn in2013! Meanwhile, in spite ofthe actual reality of averagecrude prices of over $100/barrel in 2012, domesticborrowing instigated by‘ghost deficits’ induced by avery conservative crude oilprice benchmark wouldexceed N727bn with cost ofborrowing in excess of 15%!

It is instructive that theIMF would recommend thatwe sustain huge ‘ghostdeficits’ financed at such

atrocious rates, whencurrently economicallychallenged countries likeSpain and Greece would bereluctant to borrow at over6%!!

It is also inexplicable thatthe IMF and others refuse torecognise that the crowdingout of the real sector from thecredit market is the collateralof government borrowing atsuch excessive rates ofinterest! The IMF maypretend ignorance that thecost of lending to the realsector at 20% currently

exceeds levels that canstimulate consumer demand,or engender industrialgrowth and increasingemployment opportunities.

Once again, it is amazingthat a respectable agencysuch as IMF wouldrecommend that any countryshould accumulate savingswith a paltry yield of 2 – 3%,while that country borrows atthe oppressive rates of 15%and above; i.e. rates that aretotally out of consonance forgovernment risk-freesovereign debts to financebudget ‘ghost’ deficits. It iseven more worrisome thatrespected Nigeriantechnocrats would acceptsuch oppressive public sectoreconomic management asbest practice!

Instructively, this obtusefiscal strategy has increasednational debt accumulationjust as quickly as it has addedto our foreign reserves!! Thus, our consolidatednational debt of over N8trillion is now probably morethan our current reserve baseof about $40bn.

It is even more baffling thatour experts miss the linkbetween our deepeningpoverty, in spite of increasingwealth, to the recklessness ofCBN’s substitution of nairaallocations for the crude oildollar revenue it illegallycaptures from the three tiersof government!!

In view of the aboveconsiderations, the vociferouswarnings of the IMF and OilMinister would seem to be‘alarmist in nature’, so thatwe would becomeintimidated, by the fear ofeconomic jeopardy, to towIMF’s misguided subtledirectives at economicsuicide.

SAVE THE NAIRA, SAVE

NIGERIANS!

IMF President Christine Lagarde

It is amazing that a respectableagency such as IMF wouldrecommend that any country shouldaccumulate savings with a paltryyield of 2 – 3%, while that countryborrows at the oppressive rates of15% and above